UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO |
Commission File Number:
(Exact Name of Registrant as Specified in its Charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer |
(Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Accelerated filer |
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☒ |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of November 6, 2023, the registrant had
Table of Contents
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Page |
PART I |
1 |
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Item 1. |
1 |
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1 |
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Condensed Consolidated Statements of Operations and Comprehensive Loss |
2 |
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Condensed Consolidated Statements of Stockholders' Equity (Deficit) |
3 |
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5 |
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6 |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
22 |
Item 3. |
32 |
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Item 4. |
32 |
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PART II |
32 |
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Item 1. |
32 |
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Item 1A. |
33 |
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Item 2. |
34 |
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Item 3. |
34 |
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Item 4. |
34 |
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Item 5. |
34 |
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Item 6. |
35 |
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36 |
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PART I—FINANCIAL INFORMATION
Item 1. Financial Statements.
HilleVax, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except share and par value data)
(unaudited)
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September 30, |
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December 31, |
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2023 |
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2022 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Marketable securities |
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— |
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Prepaid expenses and other current assets (includes related party amounts of $ |
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Total current assets |
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Property and equipment, net |
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Operating lease right-of-use assets |
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Restricted cash |
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Other assets |
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Total assets |
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$ |
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$ |
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable (includes related party amounts of $ |
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$ |
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$ |
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Accrued expenses (includes related party amounts of $ |
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Accrued interest |
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Current portion of operating lease liability |
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Total current liabilities |
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Operating lease liability, net of current portion |
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Long-term debt, net of debt discount |
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Other long-term liabilities |
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Total liabilities |
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Stockholders’ equity: |
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Preferred stock, $ |
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Common stock, $ |
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Additional paid-in capital |
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Accumulated other comprehensive loss |
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( |
) |
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( |
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Accumulated deficit |
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( |
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( |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity |
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$ |
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$ |
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See accompanying notes.
1
HilleVax, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(in thousands, except share and per share data)
(unaudited)
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Three Months Ended |
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Nine Months Ended |
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2023 |
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2022 |
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2023 |
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2022 |
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Operating expenses: |
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Research and development (includes related party |
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$ |
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$ |
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$ |
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$ |
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In-process research and development - related party |
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— |
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— |
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— |
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General and administrative (includes related party |
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Total operating expenses |
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Loss from operations |
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( |
) |
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( |
) |
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( |
) |
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( |
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Other income (expense): |
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Interest income |
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Interest expense (includes related party amounts |
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( |
) |
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( |
) |
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( |
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( |
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Change in fair value of convertible promissory notes (includes related party amounts of $ |
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— |
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— |
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— |
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( |
) |
Change in fair value of warrant liabilities - related party |
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— |
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— |
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— |
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( |
) |
Other income (expense) |
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( |
) |
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( |
) |
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Total other income (expense) |
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( |
) |
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Net loss |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
) |
Other comprehensive loss: |
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Unrealized loss on marketable securities |
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( |
) |
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— |
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( |
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— |
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Pension and other postemployment benefits |
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— |
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— |
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Total comprehensive loss |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
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$ |
( |
) |
Net loss per share, basic and diluted |
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$ |
( |
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$ |
( |
) |
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$ |
( |
) |
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$ |
( |
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Weighted-average shares of common stock outstanding, basic and diluted |
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See accompanying notes.
2
HilleVax, Inc.
Condensed Consolidated Statements of Stockholders’ Equity (Deficit)
(in thousands, except share data)
(unaudited)
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Common Stock |
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Shares |
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Amount |
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Additional |
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Accumulated Other Comprehensive Loss |
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Accumulated |
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Total |
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Balance at June 30, 2023 |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
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$ |
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Vesting of restricted shares |
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— |
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— |
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— |
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— |
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— |
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Stock—based compensation |
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— |
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— |
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— |
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— |
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Exercise of common stock options |
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— |
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— |
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— |
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Issuance of common stock in connection with underwritten public offering, net |
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— |
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— |
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Unrealized loss on marketable securities |
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— |
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— |
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— |
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( |
) |
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— |
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( |
) |
Pension and other postemployment benefits |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Balance at September 30, 2023 |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
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$ |
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Balance at June 30, 2022 |
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$ |
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$ |
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$ |
— |
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$ |
( |
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$ |
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Vesting of restricted shares |
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— |
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— |
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— |
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— |
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— |
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Stock—based compensation |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Balance at September 30, 2022 |
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$ |
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$ |
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$ |
— |
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$ |
( |
) |
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$ |
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||||
See accompanying notes.
3
HilleVax, Inc.
Condensed Consolidated Statements of Stockholders’ Equity (Deficit) - (Continued)
(in thousands, except share data)
(unaudited)
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Common Stock |
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Shares |
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Amount |
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Additional |
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Accumulated Other Comprehensive Loss |
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Accumulated |
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Total |
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Balance at December 31, 2022 |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
) |
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$ |
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Vesting of restricted shares |
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— |
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— |
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— |
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— |
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— |
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Stock—based compensation |
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— |
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— |
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— |
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— |
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Exercise of common stock options |
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— |
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— |
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— |
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Issuance of common stock under stock purchase plan |
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— |
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— |
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— |
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Issuance of common stock in connection with underwritten public offering, net |
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— |
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— |
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Unrealized loss on marketable securities |
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— |
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— |
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— |
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( |
) |
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— |
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( |
) |
Pension and other postemployment benefits |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Balance at September 30, 2023 |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
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$ |
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Balance at December 31, 2021 |
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$ |
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$ |
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$ |
— |
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$ |
( |
) |
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$ |
( |
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Issuance of common stock in connection with initial public offering, net of issuance costs of $ |
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— |
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— |
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Conversion of August 2021 Notes and accrued interest into common shares |
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— |
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— |
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Conversion of Takeda Warrant liability into equity |
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— |
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— |
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— |
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— |
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Vesting of restricted shares |
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— |
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— |
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— |
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— |
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— |
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Stock—based compensation |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Balance at September 30, 2022 |
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$ |
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$ |
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$ |
— |
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$ |
( |
) |
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$ |
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See accompanying notes.
4
HilleVax, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
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Nine Months Ended |
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2023 |
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2022 |
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Cash flows from operating activities |
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Net loss |
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$ |
( |
) |
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$ |
( |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
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Depreciation |
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— |
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Stock-based compensation |
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Change in fair value of convertible promissory notes (includes related party |
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— |
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Change in fair value of warrant liabilities - related party |
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— |
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Amortization of operating lease right-of-use assets |
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Amortization of debt discount |
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Issuance of PIK interest debt |
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Acquired in-process research and development - related party |
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— |
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Net amortization of premiums and discounts on marketable securities |
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( |
) |
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— |
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Loss on disposal of property and equipment |
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— |
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Changes in operating assets and liabilities: |
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Prepaid expenses and other current assets (includes related party amounts of $ |
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( |
) |
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Accounts payable, accrued expenses and other long-term liabilities |
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( |
) |
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Accrued interest (includes related party amounts of $ |
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Operating lease right-of-use assets and liabilities |
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Net cash used in operating activities |
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( |
) |
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( |
) |
Cash flows from investing activities |
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Cash paid for purchased in-process research and development |
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— |
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( |
) |
Purchases of property and equipment |
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( |
) |
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( |
) |
Purchases of marketable securities |
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( |
) |
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— |
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Proceeds from sales or maturities of marketable securities |
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— |
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Net cash used in investing activities |
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( |
) |
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( |
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Cash flows from financing activities |
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Proceeds from issuances of stock under ESPP |
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— |
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Proceeds from issuance of common stock in initial public offering |
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— |
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Payment of initial public offering costs |
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— |
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( |
) |
Proceeds from issuance of common stock in underwritten public offering, net of issuance costs |
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— |
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Proceeds from issuance of long-term debt, net of issuance costs |
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Proceeds from exercise of stock options |
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— |
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Net cash provided by financing activities |
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Net increase (decrease) in cash, cash equivalents and restricted cash |
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( |
) |
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Cash, cash equivalents and restricted cash—beginning of period |
|
|
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||
Cash, cash equivalents and restricted cash—end of period |
|
$ |
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$ |
|
||
Supplemental disclosure of cash flow information |
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Cash paid for interest |
|
$ |
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|
$ |
|
||
Supplemental disclosure of noncash investing and financing activities |
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||
Operating lease |
|
$ |
— |
|
|
$ |
|
|
Unpaid initial public offering costs |
|
$ |
— |
|
|
$ |
|
|
Unpaid underwritten public offering costs |
|
$ |
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|
$ |
— |
|
|
Unpaid property and equipment purchases |
|
$ |
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|
$ |
|
||
Conversion of convertible promissory notes and interest into common stock |
|
$ |
— |
|
|
$ |
|
|
Conversion of warrant liability into equity |
|
$ |
— |
|
|
$ |
|
|
Accreted final interest payment fees |
|
$ |
|
|
$ |
|
||
See accompanying notes.
5
HilleVax, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
1. Organization
Organization
HilleVax, Inc. (the “Company” or “HilleVax”) was incorporated in the state of Delaware in March 2020 under the name MokshaCo, Inc. (“MokshaCo”). On February 8, 2021, MokshaCo changed its name to HilleVax and merged with North Bridge V, Inc. (“North Bridge V”) and YamadaCo III, Inc. (“YamadaCo III”), each a Delaware corporation formed in 2019, with HilleVax being the surviving entity (the “Merger”). The Company is a biopharmaceutical company focused on developing and commercializing novel vaccines.
Forward Stock Split
On April 22, 2022, the Company effected a
Liquidity and Capital Resources
From inception to September 30, 2023, the Company has devoted substantially all of its efforts to organizing and staffing the Company, business planning, raising capital, in-licensing its initial vaccine candidate, HIL-214, preparing for and managing its clinical trials of HIL-214, and providing other general and administrative support for these operations. The Company has a limited operating history, has never generated any revenue, and the sales and income potential of its business is unproven. The Company has incurred net losses and negative cash flows from operating activities since its inception and expects to continue to incur net losses into the foreseeable future as it continues the development and potential commercialization of HIL-214. From inception to September 30, 2023, the Company has funded its operations through the issuance of convertible promissory notes, commercial bank debt, the sale of
The accompanying condensed consolidated financial statements have been prepared assuming the Company will continue as a going concern. Management is required to perform a two-step analysis over the Company’s ability to continue as a going concern. Management must first evaluate whether there are conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern (Step 1). If management concludes that substantial doubt is raised, management is also required to consider whether its plans alleviate that doubt (Step 2). Management believes that it has sufficient working capital on hand to fund operations through at least the next twelve months from the date these financial statements were issued. There can be no assurance that the Company will be successful in acquiring additional funding, if needed, that the Company’s projections of its future working capital needs will prove accurate, or that any additional funding would be sufficient to continue operations in future years.
2. Summary of Significant Accounting Policies
Basis of Presentation
The Company's financial statements include the accounts of HilleVax Security Corporation, a wholly-owned subsidiary formed in Massachusetts, and HilleVax GmbH, a wholly-owned subsidiary formed in Zurich, Switzerland. The functional currency of the Company, HilleVax Security Corporation and HilleVax GmbH is the U.S. dollar. The Company’s assets and liabilities that are not denominated in the functional currency are remeasured into U.S. dollars at foreign currency exchange rates in effect at the balance sheet date except for nonmonetary assets, which are remeasured at historical foreign currency exchange rates in effect at the date of transaction. Net realized and unrealized gains and losses from foreign currency transactions and remeasurement are reported in other income (expense), in the condensed consolidated statements of operations and were not material for the periods presented. All intercompany transactions have been eliminated in consolidation.
6
Unaudited Interim Financial Information
The unaudited condensed consolidated financial statements as of September 30, 2023, and for the three and nine months ended September 30, 2023 and 2022, have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”), and with U.S. generally accepted accounting principles (“GAAP”) applicable to interim financial statements. These unaudited condensed consolidated financial statements have been prepared on the same basis as the Company’s audited financial statements and include all adjustments, consisting of only normal recurring accruals, which in the opinion of management are necessary to present fairly the Company’s financial position as of the interim date and results of operations for the interim periods presented. Interim results are not necessarily indicative of results for a full year or future periods. The condensed consolidated balance sheet data as of December 31, 2022 was derived from the Company’s audited financial statements but does not include all disclosures required by GAAP. These unaudited condensed financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2022, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 filed with the SEC on March 17, 2023.
Use of Estimates
The preparation of the Company’s unaudited condensed consolidated financial statements requires it to make estimates and assumptions that impact the reported amounts of assets, liabilities and expenses and the disclosure of contingent assets and liabilities in the Company’