CAMBRIDGE, Mass., March 08, 2024 (GLOBE NEWSWIRE) -- Fulcrum Therapeutics, Inc.® (NASDAQ:FULC), a clinical-stage biopharmaceutical company focused on developing small molecules to improve the lives of patients with genetically defined rare diseases, today announced that the company granted non-statutory stock options to two new employees. Fulcrum granted stock options to purchase shares of the company's common stock pursuant to the company's 2022 Inducement Stock Incentive Plan, as amended, or the plan, as ...

Fulcrum Therapeutics, Inc. (FULC) came out with a quarterly loss of $0.40 per share versus the Zacks Consensus Estimate of a loss of $0.44. This compares to loss of $0.50 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 9.09%. A quarter ago, it was expected that this company would post a loss of $0.44 per share when it actually produced a loss of $0.39, delivering a surprise of 11.36%.Over the last four quarters, the company ha ...

Part I [Business](index=7&type=section&id=Item%201.%20Business) Fulcrum Therapeutics is a clinical-stage biopharmaceutical company developing small molecules for genetically defined rare diseases Clinical Pipeline Overview | Indication | Asset | Mechanism of Action | Preclinical | Phase 1 | Phase 2 | Phase 3 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **FSHD** | Losmapimod | DUX4 Reduction | | | | **✓** | | **SCD** | Pociredir | HbF Induction | | **✓** | | | - The company's primary focus is on developing small molecule therapies for rare genetic diseases with high unmet medical needs[20](index=20&type=chunk) - Losmapimod's Phase 3 REACH trial completed enrollment of **260 patients** in September 2023, with topline data anticipated in **Q4 2024**[20](index=20&type=chunk) - The FDA lifted a clinical hold on the IND for pociredir in August 2023, and the Phase 1b trial is being re-initiated at higher dose levels (12 mg and 20 mg) with revised criteria to target patients with higher disease severity[21](index=21&type=chunk)[79](index=79&type=chunk) [Losmapimod for FSHD](index=9&type=section&id=Losmapimod%20for%20FSHD) Losmapimod is being developed for Facioscapulohumeral Muscular Dystrophy (FSHD), a progressive muscle-wasting disease with no approved treatments - FSHD is a rare, progressive disease with no approved treatments, caused by the aberrant expression of the DUX4 gene in skeletal muscle[28](index=28&type=chunk)[31](index=31&type=chunk) - The pivotal Phase 3 REACH trial is a randomized, double-blind, placebo-controlled study evaluating a 15 mg twice-daily dose of losmapimod over 48 weeks, with the primary endpoint being the absolute change from baseline in Reachable Workspace (RWS)[51](index=51&type=chunk) - Previous Phase 2b (ReDUX4) trial data showed that while the primary biomarker endpoint was not met, losmapimod demonstrated **clinically relevant benefits** on functional measures like RWS and patient-reported outcomes compared to placebo at 48 weeks[37](index=37&type=chunk)[44](index=44&type=chunk) - Losmapimod has an extensive safety history, having been evaluated by its original developer, GSK, in nearly **3,500 subjects** across multiple non-muscle indications, where it was generally well-tolerated[36](index=36&type=chunk)[61](index=61&type=chunk) [Pociredir for SCD](index=17&type=section&id=Pociredir%20for%20SCD) Pociredir is an oral small molecule designed to treat Sickle Cell Disease (SCD) by inducing fetal hemoglobin (HbF) production - Pociredir aims to treat the root cause of SCD by inducing HbF, which is known to mitigate clinical manifestations of the disease[73](index=73&type=chunk)[74](index=74&type=chunk) - Interim Phase 1b data from the 6 mg cohort showed up to **9.5% absolute HbF increases**, and data from the 12 mg cohort (prior to the hold) showed up to **10.0% absolute HbF increases** from baseline after 42 days[81](index=81&type=chunk)[82](index=82&type=chunk) - The FDA placed a full clinical hold on the pociredir IND in February 2023, citing hematological malignancies observed in toxicology studies, similar to other PRC2 inhibitors; the hold was lifted in August 2023[77](index=77&type=chunk)[78](index=78&type=chunk)[79](index=79&type=chunk) - The Phase 1b trial is being re-initiated with amended inclusion/exclusion criteria to target patients with higher disease severity, enrolling approximately 10 patients at the 12 mg dose and another 10 at the 20 mg dose[79](index=79&type=chunk)[85](index=85&type=chunk) [License Agreements and Collaborations](index=26&type=section&id=License%20Agreements%20and%20Collaborations) Fulcrum maintains several key strategic agreements for its pipeline, including in-licensing losmapimod and collaborating on new targets - Fulcrum in-licensed losmapimod from GSK, gaining exclusive worldwide rights, with the agreement including up to **$37.5 million** in development/regulatory milestones and up to **$60.0 million** in sales milestones, plus tiered royalties[99](index=99&type=chunk)[101](index=101&type=chunk) - The collaboration with MyoKardia (BMS) focuses on identifying targets for cardiomyopathies, for which Fulcrum received a **$10.0 million** upfront payment and is eligible for up to **$298.5 million** in milestones per target, plus tiered royalties[105](index=105&type=chunk)[108](index=108&type=chunk) - In July 2023, Fulcrum entered into an exclusive worldwide license agreement with CAMP4 for its Diamond Blackfan Anemia (DBA) program, with potential milestones totaling up to **$70.0 million**, plus royalties[110](index=110&type=chunk)[111](index=111&type=chunk) [Competition](index=30&type=section&id=Competition) The company faces competition from major pharmaceutical and biotechnology firms across its FSHD and SCD programs - For FSHD, there are no approved treatments, and key competitors in clinical development include **Roche**, **Avidity**, and **Arrowhead Pharmaceutical**[131](index=131&type=chunk)[132](index=132&type=chunk) - For SCD, pociredir competes with approved oral therapies (hydroxyurea, voxelotor, crizanlizumab, L-glutamine) and two recently approved gene therapies (**lovo-cel** and **exa-cel**)[133](index=133&type=chunk)[134](index=134&type=chunk) - Other SCD therapies in development include small molecules from **Novo Nordisk** (nDec) and **Agios** (mitapivat), and an HbS polymerization inhibitor from **Pfizer** (GBT-601)[137](index=137&type=chunk) [Government Regulation and Product Approvals](index=32&type=section&id=Government%20Regulation%20and%20Product%20Approvals) The company's operations are subject to extensive regulation by government authorities in the U.S. and other countries - The drug development and approval process in the U.S. requires successful completion of preclinical studies and three phases of human clinical trials before an NDA can be submitted to the FDA[141](index=141&type=chunk)[155](index=155&type=chunk) - The FDA has granted losmapimod **Orphan Drug** and **Fast Track** designations for FSHD, while pociredir has received **Orphan Drug** and **Fast Track** designations for SCD[39](index=39&type=chunk)[77](index=77&type=chunk) - In the EU, the approval process is managed by the EMA through a centralized procedure for rare diseases, leading to a single marketing authorization valid across the EU[216](index=216&type=chunk)[217](index=217&type=chunk)[215](index=215&type=chunk) - The company is subject to healthcare laws including the Anti-Kickback Statute, False Claims Act, and pricing regulations like the Inflation Reduction Act of 2022 (IRA), which could impact product pricing and reimbursement[200](index=200&type=chunk)[208](index=208&type=chunk) [Human Capital Management](index=56&type=section&id=Human%20Capital%20Management) The company emphasizes a patient-focused culture and is committed to diversity, equity, and inclusion to attract and retain talent - As of February 20, 2024, the company had **76 full-time employees**, with 26 holding M.D. or Ph.D. degrees and 47 engaged in R&D[248](index=248&type=chunk) - The company reports a diverse workforce, with women comprising approximately **55%** of full-time employees and non-white employees making up about **29%** of the U.S. workforce[251](index=251&type=chunk) [Risk Factors](index=58&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks related to its financial condition, clinical development, third-party reliance, and intellectual property - The company has a history of significant losses (**$97.3 million in 2023**) and an accumulated deficit of **$509.7 million** as of December 31, 2023, and expects to incur losses for several more years[255](index=255&type=chunk) - **Substantial additional funding** is required to continue clinical trials and development programs, and failure to raise capital could force delays or elimination of programs[258](index=258&type=chunk) - Clinical drug development is uncertain, as highlighted by the FDA's clinical hold on pociredir from February to August 2023, which underscores the risk of delays and unforeseen challenges[288](index=288&type=chunk)[293](index=293&type=chunk) - The company relies on third-party contract manufacturing organizations (CMOs) for its product candidates, which poses risks related to supply, quality, and regulatory compliance[329](index=329&type=chunk) - The company's ability to protect its intellectual property is critical, as the composition of matter patents for losmapimod licensed from GSK have expired, increasing reliance on method-of-use patents[367](index=367&type=chunk)[373](index=373&type=chunk) [Unresolved Staff Comments](index=114&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - There are no unresolved staff comments[490](index=490&type=chunk) [Cybersecurity](index=114&type=section&id=Item%201C.%20Cybersecurity) The company has implemented a cybersecurity risk management process integrated into its enterprise risk management framework - The company's cybersecurity risk management is integrated into its overall enterprise risk management process and utilizes third-party security providers for testing and assessments[491](index=491&type=chunk)[492](index=492&type=chunk) - The audit committee has oversight responsibility for cybersecurity risks, with the Executive Director, IT & Operations leading the program[495](index=495&type=chunk)[497](index=497&type=chunk) [Properties](index=114&type=section&id=Item%202.%20Properties) The company's principal facility is leased office and laboratory space in Cambridge, Massachusetts - The company leases approximately **28,731 square feet** of office and lab space in Cambridge, MA, with the lease expiring in June 2028[499](index=499&type=chunk) [Legal Proceedings](index=114&type=section&id=Item%203.%20Legal%20Proceedings) The company is facing a class action lawsuit alleging violations of the Securities Exchange Act - A class action lawsuit was filed against the company and its officers related to the clinical hold on pociredir, alleging misleading statements about the drug's development[500](index=500&type=chunk) - The company filed a motion to dismiss the lawsuit in November 2023 and plans to defend against the litigation vigorously[500](index=500&type=chunk) [Mine Safety Disclosures](index=116&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's operations - This item is not applicable[501](index=501&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=117&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock is traded on the Nasdaq Global Market, and it does not anticipate paying cash dividends - Common stock trades on the Nasdaq Global Market under the symbol **"FULC"**[503](index=503&type=chunk) - The company has never declared or paid cash dividends and does not intend to in the foreseeable future[505](index=505&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=118&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) The company's net loss decreased in 2023, and its cash position is expected to fund operations into 2026 Results of Operations (2023 vs. 2022) | (in thousands) | 2023 | 2022 | Change ($) | | :--- | :--- | :--- | :--- | | Collaboration revenue | $2,805 | $6,342 | $(3,537) | | Research and development | $71,801 | $76,782 | $(4,981) | | General and administrative | $41,668 | $41,694 | $(26) | | **Total operating expenses** | **$113,469** | **$118,903** | **$(5,434)** | | Loss from operations | $(110,664) | $(112,561) | $1,897 | | Other income, net | $13,329 | $2,690 | $10,639 | | **Net loss** | **$(97,335)** | **$(109,871)** | **$12,536** | - The decrease in R&D expenses was primarily driven by lower external costs for pociredir due to the clinical hold and a $5.0 million milestone payment to GSK in 2022 that did not recur, partially offset by higher costs for the advancing REACH trial[540](index=540&type=chunk) - As of December 31, 2023, the company had **$236.2 million** in cash, cash equivalents, and marketable securities, with a projected cash runway to fund operations into **2026**[517](index=517&type=chunk) - In January 2023, the company raised net proceeds of **$117.3 million** from a public offering of its common stock[513](index=513&type=chunk)[544](index=544&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=131&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate sensitivity related to its investment portfolio - The main market risk is interest rate sensitivity on its **$236.2 million** portfolio of cash, cash equivalents, and marketable securities[576](index=576&type=chunk) - The company has some exposure to foreign currency fluctuations from contracts with non-U.S. vendors but does not currently use hedging instruments[577](index=577&type=chunk) [Financial Statements and Supplementary Data](index=131&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section contains the company's audited consolidated financial statements for fiscal years 2023 and 2022 Consolidated Balance Sheet Data (in thousands) | | Dec 31, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $25,563 | $35,098 | | Marketable securities | $210,658 | $167,823 | | **Total Assets** | **$257,694** | **$226,685** | | **Liabilities & Equity** | | | | Total current liabilities | $13,675 | $16,725 | | **Total Liabilities** | **$22,501** | **$27,743** | | **Total Stockholders' Equity** | **$235,193** | **$198,942** | Consolidated Statement of Operations Data (in thousands) | | Year Ended Dec 31, 2023 | Year Ended Dec 31, 2022 | | :--- | :--- | :--- | | Collaboration revenue | $2,805 | $6,342 | | Total operating expenses | $113,469 | $118,903 | | Loss from operations | $(110,664) | $(112,561) | | **Net loss** | **$(97,335)** | **$(109,871)** | | Net loss per share | $(1.59) | $(2.44) | [Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](index=131&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants - There were no disagreements with accountants on accounting and financial disclosure[580](index=580&type=chunk) [Controls and Procedures](index=133&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and internal control over financial reporting were effective - Management concluded that the company's disclosure controls and procedures were **effective** as of December 31, 2023[582](index=582&type=chunk) - Management concluded that internal control over financial reporting was **effective** as of December 31, 2023[585](index=585&type=chunk) - The company is exempt from providing an auditor's attestation report on internal controls due to its status as an **emerging growth company**[586](index=586&type=chunk) [Other Information](index=134&type=section&id=Item%209B.%20Other%20Information) The company terminated its at-the-market (ATM) equity distribution agreement - The company terminated its May 2022 at-the-market (ATM) offering program, which had an aggregate offering price of up to **$50.0 million**, and no shares were sold under this agreement[589](index=589&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=135&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) This information will be provided in the company's 2024 Definitive Proxy Statement - Information regarding directors, executive officers, and corporate governance is incorporated by reference from the forthcoming 2024 Proxy Statement[593](index=593&type=chunk) [Executive Compensation](index=135&type=section&id=Item%2011.%20Executive%20Compensation) This information will be provided in the company's 2024 Definitive Proxy Statement - Information regarding executive compensation is incorporated by reference from the forthcoming 2024 Proxy Statement[595](index=595&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=135&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) This information will be provided in the company's 2024 Definitive Proxy Statement - Information regarding security ownership is incorporated by reference from the forthcoming 2024 Proxy Statement[596](index=596&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=135&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) This information will be provided in the company's 2024 Definitive Proxy Statement - Information regarding related transactions and director independence is incorporated by reference from the forthcoming 2024 Proxy Statement[597](index=597&type=chunk) [Principal Accountant Fees and Services](index=135&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) This information will be provided in the company's 2024 Definitive Proxy Statement - Information regarding principal accountant fees and services is incorporated by reference from the forthcoming 2024 Proxy Statement[598](index=598&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=136&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the consolidated financial statements and exhibits filed with the report - This item lists the financial statements and exhibits filed with the Form 10-K[600](index=600&type=chunk)[603](index=603&type=chunk) [Form 10-K Summary](index=136&type=section&id=Item%2016.%20Form%2010-K%20Summary) No Form 10-K summary is provided - This item is not applicable[604](index=604&type=chunk)

Exhibit 99.1 Fulcrum Therapeutics Announces Recent Business Highlights and Financial Results for Fourth Quarter and Full Year 2023 ― On track to report topline data for Phase 3 REACH trial of losmapimod in facioscapulohumeral muscular dystrophy (FSHD) in the fourth quarter of 2024 ― ― Restart of the Phase 1b PIONEER trial of pociredir in sickle cell disease (SCD) underway ― ― Conference call and webcast scheduled for 8:00 a.m. ET today ― CAMBRIDGE, Mass., – February 27, 2024 – Fulcrum Therapeutics, Inc. ® ( ...

[Preliminary Information](index=2&type=section&id=Preliminary%20Information) [Cautionary Note Regarding Forward-Looking Statements](index=2&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section cautions against undue reliance on forward-looking statements regarding operations, financial performance, and product development due to inherent risks - Forward-looking statements cover ongoing clinical trials (**losmapimod**, **pociredir**), impact of organizational streamlining, initiation/timing of **R&D programs**, **commercialization plans**, **funding expectations**, potential advantages of **product candidates**, **market acceptance**, **intellectual property**, and **collaborations**[6](index=6&type=chunk)[7](index=7&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, as **actual results may differ materially** due to various **risks and uncertainties**, particularly those detailed in the 'Risk Factors' and 'Management's Discussion and Analysis of Results of Operations' sections[8](index=8&type=chunk)[9](index=9&type=chunk) [Summary Risk Factors](index=3&type=section&id=SUMMARY%20RISK%20FACTORS) This section summarizes principal risks including accumulated losses, funding needs, early development stage, lengthy drug development, adverse events, competition, and third-party reliance Key Financial Risks | Metric | Amount (as of Sep 30, 2023) | Previous (as of Dec 31, 2022) | | :----- | :-------------------------- | :----------------------------- | | Net Loss (9 months) | $72.6 million | $109.9 million (FY2022) | | Accumulated Deficit | $484.9 million | $412.3 million (FY2022) | - The company expects to incur **losses** for several years and will require **substantial additional funding** to support product development programs (**losmapimod**, **pociredir**) and **commercialization efforts**[11](index=11&type=chunk) - Key operational risks include the **early stage of development** with only **two clinical candidates**, the **lengthy and uncertain nature** of clinical drug development (e.g., recent **clinical hold on pociredir**), potential for **serious adverse events**, and **reliance on contract manufacturing organizations (CMOs)** and **third parties for clinical trials**[11](index=11&type=chunk)[12](index=12&type=chunk) - Other risks include **substantial competition**, challenges in **intellectual property protection**, **adverse developments in the financial services industry**, and potential impacts from **pandemics or geopolitical events**[11](index=11&type=chunk)[12](index=12&type=chunk) [PART I. FINANCIAL INFORMATION](index=5&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents unaudited consolidated financial statements for Q3 2023 and 2022, covering balance sheets, operations, equity, cash flows, and detailed accounting notes [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20September%2030%2C%202023%20and%20December%2031%2C%202022) Consolidated balance sheets show total assets increased to **$278.9 million** (Sep 30, 2023) from **$226.7 million** (Dec 31, 2022), driven by marketable securities and paid-in capital Consolidated Balance Sheet Highlights (in thousands) | Item | Sep 30, 2023 | Dec 31, 2022 | Change ($) | Change (%) | | :-------------------------------- | :----------- | :----------- | :--------- | :--------- | | Total Assets | $278,879 | $226,685 | $52,194 | 23.0% | | Cash and cash equivalents | $30,080 | $35,098 | $(5,018) | -14.3% | | Marketable securities | $227,011 | $167,823 | $59,188 | 35.3% | | Total Liabilities | $23,417 | $27,743 | $(4,326) | -15.6% | | Total Stockholders' Equity | $255,462 | $198,942 | $56,520 | 28.4% | | Accumulated Deficit | $(484,917) | $(412,338) | $(72,579) | 17.6% | - The increase in **total assets** is primarily due to a significant rise in **marketable securities**, while **cash and cash equivalents** saw a decrease[15](index=15&type=chunk) - **Stockholders' equity increased substantially**, mainly driven by **additional paid-in capital** from **common stock issuances**, despite an increase in **accumulated deficit**[15](index=15&type=chunk) [Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20for%20the%20three%20and%20nine%20months%20ended%20September%2030%2C%202023%20and%202022) Consolidated statements show a net loss of **$24.0 million** (Q3 2023) and **$72.6 million** (YTD Sep 2023), with nine-month loss decreasing despite lower collaboration revenue and R&D expenses Consolidated Statements of Operations Highlights (in thousands) | Item | 3 Months Ended Sep 30, 2023 | 3 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Collaboration revenue | $759 | $1,183 | $1,934 | $5,657 | | Research and development | $18,238 | $15,366 | $52,802 | $58,216 | | General and administrative | $9,961 | $9,707 | $31,804 | $31,564 | | Total operating expenses | $28,199 | $25,538 | $84,606 | $90,245 | | Loss from operations | $(27,440) | $(24,355) | $(82,672) | $(84,588) | | Other income, net | $3,423 | $617 | $10,093 | $852 | | Net loss | $(24,017) | $(23,738) | $(72,579) | $(83,736) | | Net loss per share (basic & diluted) | $(0.39) | $(0.51) | $(1.19) | $(1.97) | - Collaboration revenue decreased by **35.8%** for the three months and **65.8%** for the nine months ended September 30, 2023, primarily due to the **termination of the Acceleron collaboration agreement**[17](index=17&type=chunk) - Research and development expenses increased by **18.7%** for the three months but decreased by **9.3%** for the nine months ended September 30, 2023, reflecting **shifts in clinical trial activities**[17](index=17&type=chunk) - **Other income, net, significantly increased** for both periods, driven by **higher returns** on **cash, cash equivalents, and marketable securities**[17](index=17&type=chunk) [Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Consolidated%20Statements%20of%20Stockholders%27%20Equity%20for%20the%20three%20and%20nine%20months%20ended%20September%2030%2C%202023%20and%202022) Stockholders' equity increased from **$198.9 million** (Dec 31, 2022) to **$255.5 million** (Sep 30, 2023), driven by common stock offerings and stock-based compensation, despite accumulated losses Stockholders' Equity Changes (in thousands) | Item | Dec 31, 2022 | Sep 30, 2023 | Change ($) | | :-------------------------- | :----------- | :----------- | :--------- | | Common Stock (Amount) | $52 | $62 | $10 | | Additional Paid-In Capital | $612,025 | $741,203 | $129,178 | | Accumulated Deficit | $(412,338) | $(484,917) | $(72,579) | | Total Stockholders' Equity | $198,942 | $255,462 | $56,520 | - The increase in **additional paid-in capital** is largely attributable to **$117.3 million** in net proceeds from a **public offering of common stock** in January 2023[20](index=20&type=chunk) - **Stock-based compensation expense** contributed **$11.4 million** to **additional paid-in capital** for the nine months ended September 30, 2023[20](index=20&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20nine%20months%20ended%20September%2030%2C%202023%20and%202022) Cash flows show a net decrease of **$5.0 million** (YTD Sep 2023), a shift from a **$55.5 million** increase (prior year), primarily due to increased net cash used in investing activities Consolidated Cash Flow Highlights (in thousands) | Activity | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | | :------------------------------------------ | :-------------------------- | :-------------------------- | | Net cash used in operating activities | $(67,807) | $(77,354) | | Net cash (used in) provided by investing activities | $(55,046) | $48,775 | | Net cash provided by financing activities | $117,835 | $84,105 | | Net (decrease) increase in cash, cash equivalents, and restricted cash | $(5,018) | $55,526 | | Cash, cash equivalents, and restricted cash, end of period | $31,172 | $92,030 | - **Net cash used in operating activities decreased by $9.6 million**, mainly due to a **lower net loss** and **increased interest income**[23](index=23&type=chunk) - **Net cash used in investing activities increased by $103.8 million**, primarily driven by **net purchases of marketable securities** in 2023 compared to net maturities in 2022[23](index=23&type=chunk) - **Net cash provided by financing activities increased by $33.7 million**, largely from **$117.3 million** in net proceeds from a January 2023 **public offering of common stock**[23](index=23&type=chunk) [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes detail business nature, accounting policies, fair value, cash, marketable securities, property, equity, stock compensation, collaborations, leases, commitments, contingencies, and net loss per share [1. Nature of the Business and Basis of Presentation](index=10&type=section&id=1.%20Nature%20of%20the%20Business%20and%20Basis%20of%20Presentation) Fulcrum Therapeutics is a clinical-stage biopharmaceutical company focused on rare diseases, with **$484.9 million** accumulated deficit and ongoing need for additional funding - Fulcrum Therapeutics, Inc. was incorporated in Delaware on August 18, 2015, and focuses on developing **small molecules** for **genetically-defined rare diseases**[25](index=25&type=chunk) - The company has incurred **recurring losses** and **negative cash flows** from operations since inception, with an **accumulated deficit of $484.9 million** as of September 30, 2023[31](index=31&type=chunk) - In January 2023, the company completed a **public offering**, issuing **9,615,384 shares** of common stock at **$13.00 per share**, generating net proceeds of **$117.3 million**[29](index=29&type=chunk) - Management expects existing cash, cash equivalents, and marketable securities to fund operations for at least **12 months** from the financial statement issuance date, but acknowledges the need for **future financing** through **equity, debt, or collaborations**[32](index=32&type=chunk) [2. Summary of Significant Accounting Policies](index=11&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines significant accounting policies, including consolidation, estimates, and off-balance sheet risk, and details the adoption of new accounting pronouncements with no material impact - The **consolidated financial statements** include Fulcrum Therapeutics, Inc. and its **wholly-owned subsidiary**, Fulcrum Therapeutics Securities Corp., with all **intercompany transactions eliminated**[33](index=33&type=chunk) - Key estimates in financial statement preparation include **revenue recognition**, **accrued expenses**, **stock-based compensation**, and **income taxes**[35](index=35&type=chunk) - The company adopted **ASU No. 2016-13 (Credit Losses)** and **ASU No. 2019-12 (Income Taxes)** effective **January 1, 2023**, with **no material impact** on its financial position or results of operations[37](index=37&type=chunk)[38](index=38&type=chunk) - The company has **no significant off-balance sheet risk** and manages credit risk primarily through **diversified investments** in **cash, cash equivalents, and marketable securities** held at large financial institutions[36](index=36&type=chunk) [3. Fair Value Measurements](index=12&type=section&id=3.%20Fair%20Value%20Measurements) This note details fair value measurements of financial assets, primarily cash equivalents and marketable securities, totaling **$257.1 million** (Sep 30, 2023), mostly classified as Level 2 Fair Value Measurements at September 30, 2023 (in thousands) | Item | Total | Level 1 | Level 2 | Level 3 | | :---------------------- | :------ | :------ | :------ | :------ | | Cash equivalents: | | | | | | Money market funds | $17,336 | $17,336 | — | — | | U.S. Treasury securities | $1,991 | — | $1,991 | — | | Commercial paper | $10,753 | — | $10,753 | — | | Marketable securities: | | | | | | U.S. Treasury securities | $19,516 | — | $19,516 | — | | Government agency securities | $69,690 | — | $69,690 | — | | Commercial paper | $32,552 | — | $32,552 | — | | Corporate bonds | $105,253 | — | $105,253 | — | | **Total** | **$257,091** | **$17,336** | **$239,755** | **—** | - The majority of marketable securities and a portion of cash equivalents are classified as **Level 2**, indicating fair value derived from **observable inputs** other than quoted prices[39](index=39&type=chunk) - There were **no transfers** between fair value levels during the three and nine months ended September 30, 2023[39](index=39&type=chunk) [4. Cash Equivalents and Marketable Securities](index=13&type=section&id=4.%20Cash%20Equivalents%20and%20Marketable%20Securities) This note details cash equivalents and marketable securities, with a total fair value of **$257.1 million** (Sep 30, 2023) and a net accumulated other comprehensive loss of **$886 thousand** from unrealized losses Cash Equivalents and Marketable Securities (in thousands) | Item | Amortized Cost (Sep 30, 2023) | Fair Value (Sep 30, 2023) | Gross Unrealized Losses (Sep 30, 2023) | | :-------------------------- | :---------------------------- | :------------------------ | :------------------------------------- | | Total cash equivalents | $30,084 | $30,080 | $(4) | | Total marketable securities | $227,893 | $227,011 | $(882) | | **Total** | **$257,977** | **$257,091** | **$(886)** | - As of September 30, 2023, the company held **83 debt securities** in an unrealized loss position for less than **12 months** (**$216.6 million** fair value) and **5 debt securities** for greater than **12 months** (**$10.4 million** fair value)[40](index=40&type=chunk) - The company has the **intent and ability to hold** its debt securities until recovery and did not record any **credit-related impairment charges**[41](index=41&type=chunk) [5. Property and Equipment, Net](index=14&type=section&id=5.%20Property%20and%20Equipment%2C%20Net) Property and equipment, net, decreased to **$5.6 million** (Sep 30, 2023) from **$6.9 million** (Dec 31, 2022), primarily due to accumulated depreciation Property and Equipment, Net (in thousands) | Item | Sep 30, 2023 | Dec 31, 2022 | | :-------------------------- | :----------- | :----------- | | Total property and equipment | $17,973 | $17,568 | | Less: accumulated depreciation | $(12,327) | $(10,662) | | **Property and equipment, net** | **$5,646** | **$6,906** | - Depreciation expense was **$0.5 million** for the three months and **$1.7 million** for the nine months ended September 30, 2023[42](index=42&type=chunk) [6. Additional Balance Sheet Detail](index=14&type=section&id=6.%20Additional%20Balance%20Sheet%20Detail) This note details prepaid expenses and other current assets, increasing to **$4.8 million**, and accrued expenses and other current liabilities, decreasing to **$7.8 million** (Sep 30, 2023) Prepaid Expenses and Other Current Assets (in thousands) | Item | Sep 30, 2023 | Dec 31, 2022 | | :-------------------------------- | :----------- | :----------- | | Prepaid expenses | $3,466 | $3,425 | | Prepaid sign-on bonuses subject to vesting provisions | $254 | $92 | | Interest income receivable | $1,099 | $852 | | **Total** | **$4,819** | **$4,369** | Accrued Expenses and Other Current Liabilities (in thousands) | Item | Sep 30, 2023 | Dec 31, 2022 | | :-------------------------- | :----------- | :----------- | | External research and development | $3,107 | $4,700 | | Payroll and benefits | $4,023 | $4,211 | | Professional services | $422 | $535 | | Other | $265 | $105 | | **Total** | **$7,817** | **$9,551** | [7. Preferred Stock](index=14&type=section&id=7.%20Preferred%20Stock) The company authorized **5,000,000** preferred shares, but none were issued or outstanding as of September 30, 2023, and no dividends have been declared since inception - **5,000,000 shares** of preferred stock were authorized, but **none were issued or outstanding** as of September 30, 2023, and December 31, 2022[44](index=44&type=chunk) - **No dividends** have been declared on preferred stock since inception[45](index=45&type=chunk) [8. Common Stock](index=14&type=section&id=8.%20Common%20Stock) This note details common stock, with **200,000,000** shares authorized and **61,822,554** outstanding (Sep 30, 2023), plus shares reserved for employee benefit plans - **200,000,000 shares** of common stock, **$0.001 par value**, were authorized[46](index=46&type=chunk) Common Shares Issued and Outstanding | Date | Shares Issued and Outstanding | | :---------------- | :---------------------------- | | Sep 30, 2023 | 61,822,554 | | Dec 31, 2022 | 52,099,211 | - Common stockholders are not entitled to receive dividends unless declared by the board of directors, and **no dividends** have been declared or paid since inception[47](index=47&type=chunk) Shares Reserved for Future Issuance | Item | Sep 30, 2023 | Dec 31, 2022 | | :------------------------------------------ | :----------- | :----------- | | Shares reserved for exercises of outstanding stock options | 10,108,766 | 6,504,080 | | Shares reserved for vesting of restricted stock units | 78,142 | 76,718 | | Shares reserved for future issuance under the 2019 Stock Incentive Plan | 2,896,782 | 1,941,054 | | Shares reserved for future issuance under the 2019 Employee Stock Purchase Plan | 1,438,938 | 1,061,279 | | Shares reserved for future issuance under the 2022 Inducement Stock Incentive Plan | 1,003,472 | 329,880 | | **Total** | **15,526,100** | **9,913,011** | [9. Stock-based Compensation Expense](index=15&type=section&id=9.%20Stock-based%20Compensation%20Expense) This note details stock-based compensation plans, summarizing stock option and restricted stock unit activity, and total stock-based compensation expense recognized - The **2019 Stock Incentive Plan** and **2022 Inducement Stock Incentive Plan** have seen **increases in shares reserved** for issuance, with **2,896,782** and **1,003,472 shares** available, respectively, as of September 30, 2023[50](index=50&type=chunk)[52](index=52&type=chunk) Stock Option Activity (9 months ended Sep 30, 2023) | Item | Number of Shares | Weighted Average Exercise Price | | :-------------------------- | :--------------- | :------------------------------ | | Outstanding at Dec 31, 2022 | 6,504,080 | $11.99 | | Granted | 5,790,673 | $5.92 | | Exercised | (38,903) | $8.96 | | Cancelled | (2,147,084) | $11.96 | | Outstanding at Sep 30, 2023 | 10,108,766 | $8.53 | | Exercisable at Sep 30, 2023 | 2,890,946 | $12.74 | Stock-based Compensation Expense (in thousands) | Category | 3 Months Ended Sep 30, 2023 | 3 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | General and administrative | $2,734 | $2,597 | $8,533 | $7,138 | | Research and development | $1,003 | $756 | $2,820 | $2,941 | | **Total** | **$3,737** | **$3,353** | **$11,353** | **$10,079** | - As of September 30, 2023, the company had **$35.2 million** of unrecognized stock-based compensation expense, to be recognized over a weighted average period of **3.07 years**[58](index=58&type=chunk) [10. Collaboration Agreements](index=17&type=section&id=10.%20Collaboration%20Agreements) This note details collaboration agreements with Acceleron (terminated Oct 2022) and MyoKardia, the latter involving an exclusive worldwide license for cardiomyopathies with upfront, research, milestone, and royalty payments - The **Acceleron Collaboration Agreement**, focused on pulmonary disease targets, terminated effective **October 1, 2022**, resulting in **no collaboration revenue** from this agreement in 2023[61](index=61&type=chunk)[62](index=62&type=chunk) - The **MyoKardia Collaboration Agreement** grants an **exclusive worldwide license** for **genetically defined cardiomyopathies**, including assay screening and research services[64](index=64&type=chunk)[65](index=65&type=chunk) - Under the MyoKardia agreement, the company received a **$10.0 million upfront payment** and **$2.5 million in prepaid research funding**, with potential for up to **$298.5 million** in aggregate **milestone payments** per target and **tiered royalties**[67](index=67&type=chunk) MyoKardia Collaboration Revenue (in thousands) | Period | Collaboration Revenue | | :-------------------------- | :-------------------- | | 3 Months Ended Sep 30, 2023 | $759 | | 3 Months Ended Sep 30, 2022 | $1,183 | | 9 Months Ended Sep 30, 2023 | $1,934 | | 9 Months Ended Sep 30, 2022 | $4,700 | - As of September 30, 2023, deferred revenue from MyoKardia was **$0.3 million**, and unbilled accounts receivable was **$0.6 million**[79](index=79&type=chunk) [11. License Agreements](index=20&type=section&id=11.%20License%20Agreements) This note describes key license agreements: GSK for **losmapimod** (FSHD) and CAMP4 for the **Diamond Blackfan Anemia (DBA)** program, both granting exclusive worldwide rights - Under the **GSK Agreement**, the company has an **exclusive worldwide license** to develop and commercialize **losmapimod**, with potential milestone payments up to **$37.5 million** (including **$7.5 million** achieved) and **tiered royalties** on net sales[80](index=80&type=chunk)[81](index=81&type=chunk) - The **CAMP4 Agreement**, entered in **July 2023**, grants an **exclusive worldwide license** for the **Diamond Blackfan Anemia (DBA) program**, including small molecule compounds and patent rights[84](index=84&type=chunk) - The CAMP4 Agreement includes an undisclosed upfront payment and potential development, regulatory, and sales milestone payments of up to **$35.0 million each**, plus **tiered royalties** on worldwide net sales[85](index=85&type=chunk) [12. Leases](index=22&type=section&id=12.%20Leases) This note details operating lease agreements for corporate headquarters at **26 Landsdowne Street** and office space at **125 Sidney Street**, outlining terms, commitments, and expenses - The lease for **26 Landsdowne Street** (**28,731 sq ft**) commenced **December 2017** and ends **June 30, 2028**, with a total commitment of **$25.1 million** over ten years[89](index=89&type=chunk) Future Minimum Lease Payments (26 Landsdowne Street, in thousands) | Year | Amount | | :--- | :----- | | 2023 | $633 | | 2024 | $2,572 | | 2025 | $2,649 | | 2026 | $2,729 | | 2027 | $2,811 | | Thereafter | $1,426 | | **Total minimum lease payments** | **$12,820** | - Operating lease expense for **26 Landsdowne Street** was approximately **$0.5 million** for the three months and **$1.3 million** for the nine months ended September 30, 2023[89](index=89&type=chunk) - An additional lease for **125 Sidney Street** (**12,196 sq ft**) commenced **November 2021** and ends **March 31, 2024**, with a total commitment of **$1.7 million** over the initial term[91](index=91&type=chunk) [13. Commitments and Contingencies](index=23&type=section&id=13.%20Commitments%20and%20Contingencies) This note addresses commitments and contingencies, including indemnification agreements and a securities class action lawsuit related to a clinical hold on **pociredir** - The company provides **indemnification** to vendors, lessors, business partners, directors, and senior management, with potential **unlimited future payments**, but has **not incurred material costs** to date[93](index=93&type=chunk) - A **class action complaint** (Celano v. Fulcrum Therapeutics, Inc., et al.) was filed on **April 28, 2023**, alleging violations of **Section 10(b)** and **20(a)** of the Exchange Act related to a clinical hold on **pociredir**[94](index=94&type=chunk) - The lawsuit seeks **compensatory damages** for an allegedly inflated stock price between **March 3, 2022**, and **March 8, 2023**, and attorneys' fees and costs. The company intends to **vigorously defend** against this litigation[94](index=94&type=chunk) [14. Defined Contribution Plan](index=23&type=section&id=14.%20Defined%20Contribution%20Plan) This note describes the company's **401(k) defined contribution savings plan**, with contributions of **$0.2 million** (Q3) and **$0.6 million** (YTD Sep) for both 2023 and 2022 - The company has a **401(k) defined contribution savings plan** for eligible employees[96](index=96&type=chunk) 401(k) Plan Contributions (in millions) | Period | 2023 | 2022 | | :-------------------------- | :--- | :--- | | 3 Months Ended Sep 30 | $0.2 | $0.2 | | 9 Months Ended Sep 30 | $0.6 | $0.6 | [15. Net Loss per Share](index=23&type=section&id=15.%20Net%20Loss%20per%20Share) This note provides the calculation of basic and diluted net loss per share, listing anti-dilutive common stock equivalents excluded from the diluted calculation Net Loss Per Share (Basic and Diluted) | Period | 2023 | 2022 | | :-------------------------- | :----- | :----- | | 3 Months Ended Sep 30 | $(0.39) | $(0.51) | | 9 Months Ended Sep 30 | $(1.19) | $(1.97) | Anti-Dilutive Common Stock Equivalents Excluded (in thousands) | Item | 3 Months Ended Sep 30, 2023 | 3 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Outstanding stock options | 10,108,766 | 5,929,065 | 10,108,766 | 5,929,065 | | Unvested restricted stock units | 78,142 | 95,174 | 78,142 | 95,174 | | **Total** | **10,186,908** | **6,024,239** | **10,186,908** | **6,024,239** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section discusses financial condition and results, focusing on clinical-stage candidates, operating losses, funding needs, revenue, expenses, and cash flow changes, emphasizing drug development risks [Overview](index=24&type=section&id=Overview) Fulcrum is a clinical-stage biopharmaceutical company developing small molecules for rare diseases, with lead candidates **losmapimod** (FSHD) and **pociredir** (SCD), facing significant losses and requiring additional funding - Fulcrum is a **clinical-stage biopharmaceutical company** focused on genetically defined rare diseases[99](index=99&type=chunk) - **Losmapimod** (FSHD) is in a **Phase 3 clinical trial (REACH)**, with enrollment completed in **September 2023** and topline data expected in **Q4 2024**[99](index=99&type=chunk) - **Pociredir** (SCD) is in a **Phase 1b clinical trial**; a clinical hold was placed in **February 2023** and lifted in **August 2023**. The trial is re-initiating at **12 mg** and **20 mg dose levels**, targeting patients with higher disease severity[100](index=100&type=chunk) - The company has incurred net losses of **$24.0 million** (Q3 2023) and **$72.6 million** (YTD Sep 2023), with an accumulated deficit of **$484.9 million**[103](index=103&type=chunk) - Existing cash, cash equivalents, and marketable securities of **$257.1 million** are expected to fund operations into **2026**, but substantial additional funding will be needed for ongoing R&D and potential commercialization[105](index=105&type=chunk)[107](index=107&type=chunk) [Components of Results of Operations](index=25&type=section&id=Components%20of%20Results%20of%20Operations) This section breaks down revenue and operating expenses, with collaboration revenue from MyoKardia, fluctuating R&D expenses, general and administrative costs, and other income from investments [Revenue](index=25&type=section&id=

[PART I. FINANCIAL INFORMATION](index=1&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This part presents the company's unaudited financial statements, management's analysis, and disclosures on controls and market risk [Item 1. Financial Statements](index=1&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for the periods ended June 30, 2023, and December 31, 2022 [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20June%2030%2C%202023%20and%20December%2031%2C%202022) The balance sheets show a significant increase in total assets and stockholders' equity driven by a recent public offering Key Balance Sheet Metrics | Metric | June 30, 2023 (in thousands) | December 31, 2022 (in thousands) | | :-------------------------------- | :----------------------------- | :------------------------------- | | Total Current Assets | $282,947 | $207,519 | | Total Assets | $300,332 | $226,685 | | Total Current Liabilities | $14,804 | $16,725 | | Total Liabilities | $24,904 | $27,743 | | Total Stockholders' Equity | $275,428 | $198,942 | - Total assets increased by **$73.6 million**, primarily driven by an increase in marketable securities[15](index=15&type=chunk) - Total stockholders' equity increased by **$76.5 million**, largely due to a public offering of common stock in January 2023[15](index=15&type=chunk)[29](index=29&type=chunk) [Consolidated Statements of Operations and Comprehensive Loss](index=7&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202023%20and%202022) The company's net loss narrowed year-over-year due to decreased operating expenses, particularly in research and development Key Operational Metrics | Metric (in thousands) | 3 Months Ended Jun 30, 2023 | 3 Months Ended Jun 30, 2022 | 6 Months Ended Jun 30, 2023 | 6 Months Ended Jun 30, 2022 | | :-------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Collaboration Revenue | $880 | $1,882 | $1,175 | $4,474 | | R&D Expenses | $17,849 | $25,019 | $34,564 | $42,850 | | G&A Expenses | $10,323 | $11,098 | $21,843 | $21,857 | | Net Loss | $(23,783) | $(34,070) | $(48,562) | $(59,998) | | Net Loss per Share | $(0.38) | $(0.83) | $(0.80) | $(1.47) | - Net loss decreased by **$10.3 million** for the three months ended June 30, 2023, and by **$11.4 million** for the six months ended June 30, 2023, primarily due to decreased operating expenses and increased other income[17](index=17&type=chunk)[127](index=127&type=chunk)[134](index=134&type=chunk) - Research and development expenses decreased by **$7.2 million** (3 months YoY) and **$8.3 million** (6 months YoY), mainly due to a **$5.0 million** milestone payment in Q2 2022 and reduced FTX-6058 costs due to a clinical hold[129](index=129&type=chunk)[130](index=130&type=chunk)[136](index=136&type=chunk)[138](index=138&type=chunk) [Consolidated Statements of Stockholders' Equity](index=8&type=section&id=Consolidated%20Statements%20of%20Stockholders%27%20Equity%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202023%20and%202022) Stockholders' equity increased significantly due to a public stock offering, while the accumulated deficit continued to grow Key Equity Metrics | Metric (in thousands) | Dec 31, 2022 | Jun 30, 2023 | | :-------------------- | :----------- | :----------- | | Common Stock | $52 | $62 | | Additional Paid-In Capital | $612,025 | $737,466 | | Accumulated Deficit | $(412,338) | $(460,900) | | Total Stockholders' Equity | $198,942 | $275,428 | - Additional paid-in capital increased significantly by **$125.4 million**, primarily from a public offering of common stock in January 2023, which generated net proceeds of **$117.3 million**[20](index=20&type=chunk)[29](index=29&type=chunk) - Accumulated deficit increased to **$460.9 million** as of June 30, 2023, reflecting ongoing net losses[20](index=20&type=chunk)[105](index=105&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20six%20months%20ended%20June%2030%2C%202023%20and%202022) Cash flow from financing activities increased substantially due to a stock offering, offsetting cash used in operations and investments Key Cash Flow Metrics | Metric (in thousands) | 6 Months Ended Jun 30, 2023 | 6 Months Ended Jun 30, 2022 | | :-------------------- | :-------------------------- | :-------------------------- | | Net Cash Used in Operating Activities | $(44,901) | $(49,472) | | Net Cash (Used in) Provided by Investing Activities | $(74,066) | $51,054 | | Net Cash Provided by Financing Activities | $117,835 | $3,159 | | Net (Decrease) Increase in Cash, Cash Equivalents, and Restricted Cash | $(1,132) | $4,741 | - Net cash used in operating activities decreased by **$4.6 million**, primarily due to lower external R&D costs related to FTX-6058's clinical hold[143](index=143&type=chunk) - Net cash provided by financing activities significantly increased to **$117.8 million**, driven by **$117.3 million** in net proceeds from a public common stock offering in January 2023[145](index=145&type=chunk) - Investing activities shifted from providing **$51.1 million** in cash in 2022 to using **$74.1 million** in 2023, mainly due to net purchases of marketable securities[144](index=144&type=chunk) [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes detail the company's accounting policies, financial instruments, agreements, and other key financial information [1. Nature of the Business and Basis of Presentation](index=10&type=section&id=1.%20Nature%20of%20the%20Business%20and%20Basis%20of%20Presentation) The company is a clinical-stage biopharmaceutical firm with a history of losses, funded by a recent public offering - Fulcrum Therapeutics, Inc is a clinical-stage biopharmaceutical company focused on genetically-defined rare diseases[25](index=25&type=chunk) - The company has incurred significant losses since inception, with an accumulated deficit of **$460.9 million** as of June 30, 2023, and expects continued losses[11](index=11&type=chunk)[30](index=30&type=chunk) - In January 2023, the company completed a public offering, issuing 9,615,384 shares of common stock at $13.00 per share, generating net proceeds of **$117.3 million**[29](index=29&type=chunk) - Management estimates that existing cash, cash equivalents, and marketable securities will fund operations for at least 12 months from the financial statement issuance date[31](index=31&type=chunk) [2. Summary of Significant Accounting Policies](index=11&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) No material changes were made to significant accounting policies, and new accounting standards had no material impact - The consolidated financial statements include Fulcrum Therapeutics, Inc and its wholly-owned subsidiary, Fulcrum Therapeutics Securities Corp, with all intercompany transactions eliminated[32](index=32&type=chunk) - No material changes occurred in significant accounting policies during the six months ended June 30, 2023[33](index=33&type=chunk) - The company adopted ASU No 2016-13 (Credit Losses) and ASU No 2019-12 (Income Taxes) effective January 1, 2023, with no material impact on financial position or results[36](index=36&type=chunk)[37](index=37&type=chunk) [3. Fair Value Measurements](index=12&type=section&id=3.%20Fair%20Value%20Measurements) The company's financial assets, primarily cash equivalents and marketable securities, are measured at fair value using Level 2 inputs Fair Value of Financial Assets | Asset Type (in thousands) | June 30, 2023 Total Fair Value | December 31, 2022 Total Fair Value | | :------------------------ | :----------------------------- | :------------------------------- | | Cash Equivalents | $33,966 | $35,098 | | Marketable Securities | $244,198 | $167,823 | | Total | $278,164 | $202,921 | - The majority of financial assets are measured at fair value using **Level 2 inputs** (observable inputs other than quoted prices)[38](index=38&type=chunk) - There were no transfers between fair value levels during the three and six months ended June 30, 2023[38](index=38&type=chunk) [4. Cash Equivalents and Marketable Securities](index=13&type=section&id=4.%20Cash%20Equivalents%20and%20Marketable%20Securities) The company holds a significant portfolio of marketable securities, with a large portion in an unrealized loss position Fair Value of Cash Equivalents and Marketable Securities | Asset Type (in thousands) | June 30, 2023 Fair Value | December 31, 2022 Fair Value | | :------------------------ | :----------------------- | :--------------------------- | | Cash Equivalents | $33,966 | $35,098 | | Marketable Securities | $244,198 | $167,823 | | Total | $278,164 | $202,921 | - As of June 30, 2023, the company held 91 debt securities in an unrealized loss position for less than 12 months, with an aggregate fair value of **$222.2 million**[39](index=39&type=chunk) - The company did not record any credit-related impairments for marketable securities, as it has the intent and ability to hold debt securities until recovery[40](index=40&type=chunk) [5. Property and Equipment, Net](index=14&type=section&id=5.%20Property%20and%20Equipment%2C%20Net) Net property and equipment decreased slightly due to depreciation expense outpacing new acquisitions Property and Equipment Breakdown | Category (in thousands) | June 30, 2023 | December 31, 2022 | | :---------------------- | :------------ | :---------------- | | Lab equipment | $9,475 | $9,057 | | Leasehold improvements | $7,102 | $7,102 | | Total Property and Equipment, Net | $6,161 | $6,906 | - Property and equipment, net, decreased by **$0.7 million** from December 31, 2022, to June 30, 2023[41](index=41&type=chunk) - Depreciation expense for the six months ended June 30, 2023, was **$1.1 million**, a slight decrease from $1.2 million in the prior year period[41](index=41&type=chunk) [6. Additional Balance Sheet Detail](index=14&type=section&id=6.%20Additional%20Balance%20Sheet%20Detail) Accrued expenses decreased primarily due to lower R&D and payroll accruals, while interest income receivable increased Selected Balance Sheet Accounts | Category (in thousands) | June 30, 2023 | December 31, 2022 | | :---------------------- | :------------ | :---------------- | | Prepaid expenses and other current assets | $4,127 | $4,369 | | Accrued expenses and other current liabilities | $7,875 | $9,551 | - Prepaid expenses decreased, while interest income receivable increased significantly from **$852 thousand to $1.4 million**[42](index=42&type=chunk) - Accrued expenses and other current liabilities decreased by **$1.7 million**, primarily due to lower payroll and benefits and external research and development accruals[42](index=42&type=chunk) [7. Preferred Stock](index=14&type=section&id=7.%20Preferred%20Stock) The company has authorized preferred stock but has not issued any shares - As of June 30, 2023, and December 31, 2022, the company had **5,000,000 shares** of undesignated preferred stock authorized, with no shares issued or outstanding[43](index=43&type=chunk) [8. Common Stock](index=14&type=section&id=8.%20Common%20Stock) The number of common shares outstanding increased significantly following a public offering in January 2023 - As of June 30, 2023, **61,822,554 shares** of common stock were issued and outstanding, up from 52,099,211 shares at December 31, 2022[15](index=15&type=chunk) - The increase in outstanding shares is primarily due to the public offering in January 2023[29](index=29&type=chunk) Shares Reserved for Future Issuance | Shares Reserved for Future Issuance | June 30, 2023 | December 31, 2022 | | :---------------------------------- | :------------ | :---------------- | | Outstanding stock options | 10,114,591 | 6,504,080 | | Future issuance under 2019 Stock Incentive Plan | 2,512,307 | 1,941,054 | | Future issuance under 2022 Inducement Stock Incentive Plan | 1,482,845 | 329,880 | [9. Stock-based Compensation Expense](index=15&type=section&id=9.%20Stock-based%20Compensation%20Expense) Stock-based compensation expense increased year-over-year, with a significant amount of unrecognized expense remaining Stock-based Compensation Breakdown | Stock-based Compensation (in thousands) | 3 Months Ended Jun 30, 2023 | 3 Months Ended Jun 30, 2022 | 6 Months Ended Jun 30, 2023 | 6 Months Ended Jun 30, 2022 | | :-------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | General and administrative | $2,391 | $2,076 | $5,799 | $4,541 | | Research and development | $972 | $803 | $1,817 | $2,185 | | Total | $3,363 | $2,879 | $7,616 | $6,726 | - The company has several stock incentive plans (2016, 2019, and 2022 Inducement Plan) and an Employee Stock Purchase Plan (ESPP)[48](index=48&type=chunk)[49](index=49&type=chunk)[51](index=51&type=chunk)[58](index=58&type=chunk) - Total stock-based compensation expense increased by **$0.5 million** for the three months and **$0.9 million** for the six months ended June 30, 2023, compared to the prior year periods[57](index=57&type=chunk) - As of June 30, 2023, unrecognized stock-based compensation expense totaled **$37.8 million**, expected to be recognized over a weighted average period of 3.25 years[57](index=57&type=chunk) [10. Collaboration and License Agreements](index=17&type=section&id=10.%20Collaboration%20and%20License%20Agreements) Collaboration revenue is primarily generated from the MyoKardia agreement, following the termination of the Acceleron agreement - The Acceleron Collaboration Agreement terminated effective October 1, 2022, resulting in no collaboration revenue from this agreement in 2023[60](index=60&type=chunk)[61](index=61&type=chunk) - Under the MyoKardia Collaboration Agreement, the company recognized **$0.9 million** and **$1.2 million** in collaboration revenue for the three and six months ended June 30, 2023, respectively[79](index=79&type=chunk) - MyoKardia made a **$10.0 million** upfront payment and **$2.5 million** prepaid research funding in July 2020, and the company achieved a **$2.5 million** preclinical milestone[66](index=66&type=chunk) - The MyoKardia agreement includes potential milestone payments up to **$298.5 million** per target and tiered royalties on net sales[66](index=66&type=chunk) [11. Right of Reference and License Agreement (GSK)](index=20&type=section&id=11.%20Right%20of%20Reference%20and%20License%20Agreement) The company's agreement with GSK for losmapimod includes significant potential milestone payments and royalties - The company has an exclusive worldwide license from GSK to develop and commercialize losmapimod[80](index=80&type=chunk) - The agreement includes potential milestone payments up to **$37.5 million** (clinical/regulatory) and **$60.0 million** (sales), plus tiered royalties on net sales[81](index=81&type=chunk) - A **$5.0 million** clinical milestone was achieved during Q2 2022[81](index=81&type=chunk) [12. Leases](index=21&type=section&id=12.%20Leases) The company holds operating leases for its corporate headquarters and additional office space with varying expiration dates Lease Liability Summary | Lease Liability (in thousands) | 26 Landsdowne Street | 125 Sidney Street | | :----------------------------- | :------------------- | :---------------- | | Total minimum lease payments | $13,453 | $631 | | Total lease liability | $11,540 | $620 | - The company leases corporate headquarters at 26 Landsdowne Street (expiring June 2028) and office space at 125 Sidney Street (expiring March 2024)[84](index=84&type=chunk)[86](index=86&type=chunk) - Operating lease expense for the six months ended June 30, 2023, was approximately **$0.9 million** for 26 Landsdowne Street and **$0.4 million** for 125 Sidney Street[84](index=84&type=chunk)[86](index=86&type=chunk) [13. Commitments and Contingencies](index=22&type=section&id=13.%20Commitments%20and%20Contingencies) The company is defending against a class action lawsuit related to the clinical hold on its FTX-6058 program - The company is subject to a class action lawsuit (Celano v Fulcrum Therapeutics, Inc, et al) filed in April 2023, alleging securities law violations related to the FTX-6058 clinical hold[89](index=89&type=chunk) - The lawsuit seeks compensatory damages for an allegedly inflated stock price between March 3, 2022, and March 8, 2023, and attorneys' fees[89](index=89&type=chunk) - The company intends to vigorously defend against this litigation and has not incurred material costs related to legal proceedings during the reporting period[89](index=89&type=chunk)[90](index=90&type=chunk) [14. Defined Contribution Plan](index=22&type=section&id=14.%20Defined%20Contribution%20Plan) The company maintains a 401(k) plan for employees with consistent contribution levels year-over-year - The company has a 401(k) Plan for eligible employees[91](index=91&type=chunk) - Contributions to the 401(k) Plan were **$0.2 million** for the three months and **$0.4 million** for the six months ended June 30, 2023, consistent with the prior year[91](index=91&type=chunk) [15. Net Loss per Share](index=22&type=section&id=15.%20Net%20Loss%20per%20Share) All potential common stock equivalents were excluded from diluted net loss per share calculations due to their anti-dilutive effect Anti-Dilutive Securities | Common Stock Equivalents | 3 Months Ended Jun 30, 2023 | 3 Months Ended Jun 30, 2022 | 6 Months Ended Jun 30, 2023 | 6 Months Ended Jun 30, 2022 | | :----------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Outstanding stock options | 10,114,591 | 6,137,740 | 10,114,591 | 6,137,740 | | Unvested restricted stock units | 84,942 | 115,189 | 84,942 | 115,189 | - All common stock equivalents were excluded from diluted net loss per share calculations due to their anti-dilutive effect[92](index=92&type=chunk) [16. Subsequent Events](index=22&type=section&id=16.%20Subsequent%20Events) The company entered into a new exclusive license agreement with CAMP4 Therapeutics after the reporting period - In July 2023, the company entered into a worldwide exclusive license agreement with CAMP4 Therapeutics Corporation for its Diamond Blackfan Anemia (DBA) program[93](index=93&type=chunk)[94](index=94&type=chunk) - Under the CAMP4 agreement, the company will make an undisclosed upfront payment and CAMP4 is eligible for up to **$35.0 million** in development/regulatory milestones and **$35.0 million** in sales milestones, plus tiered royalties[95](index=95&type=chunk) - The company is currently evaluating the accounting treatment for the CAMP4 license agreement[97](index=97&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes the company's financial condition, results of operations, clinical programs, and future funding needs [Overview](index=24&type=section&id=Overview) The company is advancing its lead candidate losmapimod while its FTX-6058 program remains on clinical hold - Fulcrum Therapeutics is a clinical-stage biopharmaceutical company focused on genetically defined rare diseases, with lead product candidates losmapimod (FSHD) and FTX-6058 (hemoglobinopathies)[100](index=100&type=chunk) - The Phase 3 clinical trial for losmapimod (REACH) is expected to complete enrollment in Q3 2023 and report topline data in Q4 2024[100](index=100&type=chunk) - The FTX-6058 program for SCD is currently on a **full clinical hold** by the FDA as of February 23, 2023, and the IND for beta thalassemia was withdrawn[101](index=101&type=chunk) - The company's proprietary product engine, FulcrumSeek, is used to identify and validate cellular drug targets for genetically defined diseases[103](index=103&type=chunk) - Net losses were **$23.8 million** and **$48.6 million** for the three and six months ended June 30, 2023, respectively, with an accumulated deficit of **$460.9 million**[105](index=105&type=chunk) [Components of Results of Operations](index=25&type=section&id=Components%20of%20Results%20of%20Operations) This section breaks down the key drivers of revenue and operating expenses [Revenue](index=25&type=section&id=Revenue) Collaboration revenue decreased due to the termination of the Acceleron agreement and lower revenue from MyoKardia - The company has not generated product sales revenue and does not expect to for several years[109](index=109&type=chunk) - Collaboration revenue decreased due to the termination of the Acceleron agreement (effective Oct 2022) and lower revenue from the MyoKardia agreement[110](index=110&type=chunk)[113](index=113&type=chunk) Collaboration Revenue Breakdown | Collaboration Revenue (in thousands) | 3 Months Ended Jun 30, 2023 | 3 Months Ended Jun 30, 2022 | 6 Months Ended Jun 30, 2023 | 6 Months Ended Jun 30, 2022 | | :----------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Acceleron | $0 | $100 | $0 | $1,000 | | MyoKardia | $900 | $1,700 | $1,200 | $3,500 | [Operating Expenses](index=27&type=section&id=Operating%20Expenses) Operating expenses are primarily driven by research and development and general and administrative costs [Research and Development Expenses](index=27&type=section&id=Research%20and%20Development%20Expenses) R&D expenses decreased significantly year-over-year, driven by a prior-year milestone payment and the FTX-6058 clinical hold - R&D expenses decreased by **$7.2 million** (3 months YoY) and **$8.3 million** (6 months YoY)[129](index=129&type=chunk)[136](index=136&type=chunk) - The decrease was primarily due to a **$5.0 million** milestone payment to GSK in Q2 2022 and reduced costs for FTX-6058 following its clinical hold[130](index=130&type=chunk)[138](index=138&type=chunk) - R&D expenses are expected to increase significantly in future periods as clinical trials advance and discovery efforts expand[123](index=123&type=chunk) R&D Expense Breakdown | R&D Expenses (in thousands) | 3 Months Ended Jun 30, 2023 | 3 Months Ended Jun 30, 2022 | 6 Months Ended Jun 30, 2023 | 6 Months Ended Jun 30, 2022 | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | External R&D | $10,353 | $16,416 | $19,903 | $24,793 | | Employee compensation | $5,037 | $5,311 | $9,844 | $11,531 | | Total R&D Expenses | $17,849 | $25,019 | $34,564 | $42,850 | [General and Administrative Expenses](index=28&type=section&id=General%20and%20Administrative%20Expenses) G&A expenses remained relatively flat year-over-year, with lower professional services costs offsetting higher compensation - G&A expenses decreased by **$0.8 million** (3 months YoY) and remained relatively flat (less than $0.1 million decrease) for the six months YoY[132](index=132&type=chunk)[137](index=137&type=chunk) - The decrease was primarily due to lower professional services costs (consulting, insurance, legal), offset by increased employee compensation and facility costs[132](index=132&type=chunk)[137](index=137&type=chunk) G&A Expense Breakdown | G&A Expenses (in thousands) | 3 Months Ended Jun 30, 2023 | 3 Months Ended Jun 30, 2022 | 6 Months Ended Jun 30, 2023 | 6 Months Ended Jun 30, 2022 | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Employee compensation | $5,710 | $5,690 | $12,977 | $11,516 | | Professional services | $3,137 | $4,125 | $5,955 | $8,046 | | Total G&A Expenses | $10,323 | $11,098 | $21,843 | $21,857 | [Other Income, Net](index=29&type=section&id=Other%20Income%2C%20Net) Other income increased substantially due to higher interest rates and a larger cash and investment balance - Other income, net, increased significantly by **$3.3 million** (3 months YoY) and **$6.4 million** (6 months YoY)[133](index=133&type=chunk)[139](index=139&type=chunk) - This increase was primarily due to a higher rate of return on cash, cash equivalents, and marketable securities, coupled with an increased average cash and investment balance[133](index=133&type=chunk)[139](index=139&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) This section provides a comparative analysis of the company's operational results for the three and six-month periods [Comparison of the Three Months ended June 30, 2023 and 2022](index=29&type=section&id=Comparison%20of%20the%20Three%20Months%20ended%20June%2030%2C%202023%20and%202022) Net loss decreased significantly due to lower R&D expenses and higher other income Three-Month Operational Comparison | Metric (in thousands) | Jun 30, 2023 | Jun 30, 2022 | Change ($) | | :-------------------- | :----------- | :----------- | :--------- | | Collaboration revenue | $880 | $1,882 | $(1,002) | | R&D expenses | $17,849 | $25,019 | $(7,170) | | G&A expenses | $10,323 | $11,098 | $(775) | | Net loss | $(23,783) | $(34,070) | $10,287 | - Net loss decreased by **$10.3 million**, primarily driven by a **$7.2 million** reduction in R&D expenses and a **$3.3 million** increase in other income, net[127](index=127&type=chunk)[129](index=129&type=chunk)[133](index=133&type=chunk) [Comparison of the Six Months ended June 30, 2023 and 2022](index=30&type=section&id=Comparison%20of%20the%20Six%20Months%20ended%20June%2030%2C%202023%20and%202022) Net loss narrowed due to reduced R&D spending and higher other income, which offset lower collaboration revenue Six-Month Operational Comparison | Metric (in thousands) | Jun 30, 2023 | Jun 30, 2022 | Change ($) | | :-------------------- | :----------- | :----------- | :--------- | | Collaboration revenue | $1,175 | $4,474 | $(3,299) | | R&D expenses | $34,564 | $42,850 | $(8,286) | | G&A expenses | $21,843 | $21,857 | $(14) | | Net loss | $(48,562) | $(59,998) | $11,436 | - Net loss decreased by **$11.4 million**, primarily due to an **$8.3 million** reduction in R&D expenses and a **$6.4 million** increase in other income, net, partially offset by a **$3.3 million** decrease in collaboration revenue[134](index=134&type=chunk)[136](index=136&type=chunk)[139](index=139&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) The company believes its current capital is sufficient to fund operations into mid-2025 but will require future financing - As of June 30, 2023, the company had **$278.2 million** in cash, cash equivalents, and marketable securities[140](index=140&type=chunk) - The company expects existing capital to fund operating expenses and capital expenditure requirements into **mid-2025**[147](index=147&type=chunk) - Future funding requirements depend on clinical trial progress, R&D expansion, regulatory approvals, manufacturing, and potential collaborations[148](index=148&type=chunk) - The company anticipates financing future cash needs through equity offerings, debt financings, collaborations, strategic alliances, and licensing arrangements[150](index=150&type=chunk) [Critical Accounting Policies and Estimates](index=34&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) No material changes to critical accounting policies were reported during the period - No material changes to critical accounting policies were reported during the three months ended June 30, 2023, from those described in the Annual Report on Form 10-K[152](index=152&type=chunk) [Recently Issued Accounting Pronouncements](index=34&type=section&id=Recently%20Issued%20Accounting%20Pronouncements) Information on recently issued accounting pronouncements is available in the notes to the financial statements - A description of recently issued accounting pronouncements is disclosed in Note 2 to the consolidated financial statements[153](index=153&type=chunk) [Emerging Growth Company Status](index=34&type=section&id=Emerging%20Growth%20Company%20Status) The company utilizes the extended transition period for new accounting standards available to emerging growth companies - The company is an 'emerging growth company' (EGC) and has elected not to opt out of the extended transition period for complying with new or revised accounting standards[154](index=154&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=34&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exempt from market risk disclosure requirements as a smaller reporting company - The company is a smaller reporting company and is not required to provide disclosures about market risk[155](index=155&type=chunk) [Item 4. Controls and Procedures](index=35&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal financial reporting controls were effective as of the period end [Evaluation of Disclosure Controls and Procedures](index=35&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) Disclosure controls and procedures were deemed effective at a reasonable assurance level - Management, including the CEO, concluded that disclosure controls and procedures were effective at the reasonable assurance level as of June 30, 2023[157](index=157&type=chunk) [Changes in Internal Control over Financial Reporting](index=35&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) No material changes in internal control over financial reporting occurred during the quarter - No material changes in internal control over financial reporting occurred during the quarter ended June 30, 2023[158](index=158&type=chunk) [PART II. OTHER INFORMATION](index=36&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part covers legal proceedings, risk factors, and other required disclosures [Item 1. Legal Proceedings](index=36&type=section&id=Item%201.%20Legal%20Proceedings) The company faces a class action lawsuit alleging securities violations related to the clinical hold on its FTX-6058 program - A class action complaint was filed on April 28, 2023, alleging violations of Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934[161](index=161&type=chunk) - The lawsuit is related to the FDA's clinical hold on the IND application for FTX-6058 for sickle cell disease, announced in February 2023[161](index=161&type=chunk) - The plaintiffs seek compensatory damages for an allegedly inflated stock price between March 3, 2022, and March 8, 2023, and attorneys' fees[161](index=161&type=chunk) [Item 1A. Risk Factors](index=36&type=section&id=Item%201A.%20Risk%20Factors) This section details significant risks that could materially affect the company's business, financial condition, and operations [Risks Related to our Financial Position and Need for Additional Capital](index=36&type=section&id=Risks%20Related%20to%20our%20Financial%20Position%20and%20Need%20for%20Additional%20Capital) The company's history of losses and need for substantial future funding pose significant financial risks - The company has incurred significant losses since inception (**$460.9 million** accumulated deficit as of June 30, 2023) and expects to continue incurring losses, potentially never achieving profitability[163](index=163&type=chunk) - Substantial additional funding will be required to support ongoing and planned clinical trials (losmapimod, FTX-6058), R&D, and potential commercialization efforts[167](index=167&type=chunk) - Inability to raise capital when needed could force delays, reductions, or elimination of product development programs or commercialization efforts[167](index=167&type=chunk) - Adverse developments in the financial services industry, such as bank failures, could impair access to funding and adversely affect business operations[189](index=189&type=chunk)[190](index=190&type=chunk) [Risks Related to the Discovery and Development of our Product Candidates](index=41&type=section&id=Risks%20Related%20to%20the%20Discovery%20and%20Development%20of%20our%20Product%20Candidates) The early stage of development and the clinical hold on FTX-6058 create substantial uncertainty for product candidates - The company is early in development with only two clinical-stage candidates (losmapimod, FTX-6058), and **FTX-6058 is currently on clinical hold**, posing significant commercialization risks[191](index=191&type=chunk) - Clinical drug development is lengthy, expensive, and uncertain; preclinical and early clinical trial results may not predict future success, and serious adverse events could halt development[195](index=195&type=chunk)[209](index=209&type=chunk) - The FDA placed a clinical hold on FTX-6058 due to hematological malignancies in nonclinical toxicology studies, which may prevent or delay its clinical development[210](index=210&type=chunk) - Challenges in patient enrollment for clinical trials, especially for rare diseases, could delay or prevent regulatory approvals[205](index=205&type=chunk)[208](index=208&type=chunk) [Risks Related to the Commercialization of our Product Candidates](index=47&type=section&id=Risks%20Related%20to%20the%20Commercialization%20of%20our%20Product%20Candidates) The company faces significant hurdles in market acceptance, competition, manufacturing, and pricing for its potential products - Even if approved, product candidates may fail to achieve market acceptance by physicians, patients, and payors, limiting commercial success[218](index=218&type=chunk) - The company lacks its own sales, marketing, and distribution capabilities and faces risks if unable to establish them or secure effective third-party agreements[220](index=220&type=chunk)[222](index=222&type=chunk) - Substantial competition from larger pharmaceutical and biotechnology companies, with greater resources, poses a significant threat to market share[223](index=223&type=chunk)[227](index=227&type=chunk) - Reliance on contract manufacturing organizations (CMOs) for product supply introduces risks of delays, quality issues, or inability to meet demand[231](index=231&type=chunk)[232](index=232&type=chunk) - Unfavorable pricing regulations, inadequate third-party coverage, or healthcare reform initiatives could harm profitability and market access[241](index=241&type=chunk)[242](index=242&type=chunk) [Risks Related to our Dependence on Third Parties](index=53&type=section&id=Risks%20Related%20to%20our%20Dependence%20on%20Third%20Parties) The company's reliance on CROs and collaboration partners introduces risks related to performance and control - Reliance on third-party CROs to conduct clinical trials reduces control and poses risks of unsatisfactory performance or missed deadlines[250](index=250&type=chunk)[251](index=251&type=chunk)[252](index=252&type=chunk) - Collaborations with third parties, such as MyoKardia, may not be successful, and the company may have limited control over collaborators' efforts and resource allocation[254](index=254&type=chunk)[255](index=255&type=chunk) - Failure to establish or maintain collaborations could force the company to alter development and commercialization plans, potentially requiring additional capital or expertise[262](index=262&type=chunk) [Risks Related to our Intellectual Property](index=55&type=section&id=Risks%20Related%20to%20our%20Intellectual%20Property) Protecting intellectual property is critical and faces challenges from patent prosecution, litigation, and license compliance - Inability to obtain, maintain, enforce, and protect patent protection for technology and product candidates could allow competitors to commercialize similar products[263](index=263&type=chunk)[264](index=264&type=chunk) - Patent prosecution is expensive and complex, with uncertain outcomes regarding issuance, scope, validity, and enforceability[265](index=265&type=chunk)[266](index=266&type=chunk) - Third parties may allege infringement of their intellectual property rights, leading to costly litigation, potential damages, or the need to obtain licenses on unfavorable terms[285](index=285&type=chunk)[290](index=290&type=chunk) - Failure to comply with obligations under intellectual property licenses could result in termination of agreements and loss of critical intellectual property rights[295](index=295&type=chunk) - Inability to protect trade secrets and proprietary information could harm the company's business and competitive position[309](index=309&type=chunk) [Risks Related to Regulatory Approval of our Product Candidates and Other Legal Compliance Matters](index=65&type=section&id=Risks%20Related%20to%20Regulatory%20Approval%20of%20our%20Product%20Candidates%20and%20Other%20Legal%20Compliance%20Matters) The company faces a complex, lengthy, and uncertain regulatory landscape for product approval and post-marketing compliance - The marketing approval process is expensive, time-consuming, and uncertain; delays or failure to obtain approvals would materially impair revenue generation[312](index=312&type=chunk)[316](index=316&type=chunk) - Orphan drug designation or exclusivity may not be obtained or, if granted, may not effectively prevent competition[320](index=320&type=chunk)[323](index=323&type=chunk) - Special designations like fast track or breakthrough therapy do not guarantee faster development, review, or approval[324](index=324&type=chunk)[327](index=327&type=chunk) - Any approved product will be subject to post-marketing restrictions, and non-compliance with regulatory requirements could lead to substantial penalties or market withdrawal[334](index=334&type=chunk)[336](index=336&type=chunk) - Compliance with global privacy and data security requirements (e g, GDPR, CCPA) could result in additional costs, liabilities, or significant fines[342](index=342&type=chunk)[347](index=347&type=chunk) [Risks Related to Employee Matters and Managing Growth](index=73&type=section&id=Risks%20Related%20to%20Employee%20Matters%20and%20Managing%20Growth) Retaining key personnel and managing expected growth are critical to the company's future success - Future success depends on retaining key executives and attracting/retaining qualified personnel, especially given recent executive transitions and a workforce reduction[365](index=365&type=chunk)[366](index=366&type=chunk) - Expected significant growth in employees and operations (drug development, regulatory, sales/marketing) may lead to difficulties in management and could disrupt operations[367](index=367&type=chunk) [Risks Related to our Common Stock](index=74&type=section&id=Risks%20Related%20to%20our%20Common%20Stock) Common stock ownership is concentrated, and its price is subject to high volatility and market conditions - Executive officers, directors, and principal stockholders collectively own approximately **48.9%** of capital stock, enabling them to control or significantly influence matters submitted to stockholders[368](index=368&type=chunk) - Provisions in corporate charter documents and Delaware law could make company acquisition more difficult and prevent attempts to replace management[370](index=370&type=chunk)[371](index=371&type=chunk) - The price of common stock is volatile and can fluctuate substantially due to various factors, including clinical trial results, regulatory developments, and market conditions[373](index=373&type=chunk)[374](index=374&type=chunk) - As an 'emerging growth company,' reduced disclosure requirements may make common stock less attractive to investors, potentially leading to lower trading volume and increased price volatility[378](index=378&type=chunk)[379](index=379&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=78&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This item is not applicable for the reporting period - This item is not applicable[387](index=387&type=chunk) [Item 3. Defaults Upon Senior Securities](index=78&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable for the reporting period - This item is not applicable[388](index=388&type=chunk) [Item 4. Mine Safety Disclosures](index=78&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable for the reporting period - This item is not applicable[389](index=389&type=chunk) [Item 5. Other Information](index=78&type=section&id=Item%205.%20Other%20Information) No other information is reported under this item - No other information is reported[390](index=390&type=chunk) [Item 6. Exhibits](index=79&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Form 10-Q - Exhibits include the Restated Certificate of Incorporation, Amended and Restated Bylaws, First Amendment to Collaboration and License Agreement with MyoKardia, and Employment Agreement with Alex C Sapir[394](index=394&type=chunk) - Certifications of the Principal Executive Officer and Principal Financial Officer are included, as well as Inline XBRL Instance and Taxonomy Extension Documents[394](index=394&type=chunk) [Signatures](index=80&type=section&id=Signatures) The report is duly signed on behalf of the company by its President and Chief Executive Officer - The report was signed by Alex C Sapir, President and Chief Executive Officer (Principal Executive Officer and Principal Financial Officer) on August 3, 2023[398](index=398&type=chunk)

Fulcrum Therapeutics, Inc. (NASDAQ:FULC) Q1 2023 Earnings Conference Call May 15, 2023 8:00 AM ET Company Participants Chris Calabrese - LifeSci Advisors, LLC Robert J. Gould - President and CEO Iain Fraser - Interim Chief Medical Officer Conference Call Participants Edward Tenthoff - Piper Sandler Joseph Schwartz - SVB Securities Unidentified Analyst - Goldman Sachs Matthew Biegler - Oppenheimer Judah Frommer - Crédit Suisse Operator Good morning and welcome to the Fulcrum Therapeutics First Quarter 2023 F ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | --- | --- | --- | | Common stock, par value $0.001 per share | FULC | The Nasdaq Global Market | or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Fo ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 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 001-38978 FULCRUM THERAPEUTICS, INC. (Exact name of registrant as specified in its Charter) | Delaware | 47-4839948 | | --- | --- | | (St ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 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: 001-38978 FULCRUM THERAPEUTICS, INC. (Exact name of registrant as specified in its charter) Delaware 47-4839948 (State or other j ...