Eyenovia(EYEN) - 2019 Q3 - Quarterly Report

PART I – FINANCIAL INFORMATION Item 1. Financial Statements The unaudited condensed financial statements reflect increased operating losses and cash burn driven by higher R&D expenses Condensed Balance Sheets The balance sheet shows decreased total assets and an increased accumulated deficit, reflecting ongoing net losses Condensed Balance Sheet Highlights (in thousands) | Balance Sheet Item | Sep 30, 2019 (Unaudited) | Dec 31, 2018 | | :--- | :--- | :--- | | Cash and cash equivalents | $18,296 | $19,728 | | Total Current Assets | $18,693 | $19,861 | | Total Assets | $18,882 | $20,015 | | Total Current Liabilities | $2,433 | $3,099 | | Total Liabilities | $2,478 | $3,140 | | Accumulated deficit | $(52,430) | $(36,514) | | Total Stockholders' Equity | $16,404 | $16,875 | Condensed Statements of Operations The company reported no revenue and a widening net loss driven by a significant rise in R&D expenses Statement of Operations Summary (in thousands, except per share data) | Metric | Q3 2019 | Q3 2018 | 9 Months 2019 | 9 Months 2018 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $3,201 | $2,488 | $10,778 | $6,994 | | General and administrative | $1,490 | $1,833 | $5,242 | $4,079 | | Total Operating Expenses | $4,691 | $4,320 | $16,020 | $11,073 | | Loss From Operations | $(4,691) | $(4,320) | $(16,020) | $(11,073) | | Net Loss | $(4,649) | $(4,321) | $(15,915) | $(11,070) | | Net Loss Per Share | $(0.29) | $(0.43) | $(1.19) | $(1.20) | Condensed Statements of Cash Flows Net cash used in operations increased, partially offset by cash from a public stock offering Cash Flow Summary for the Nine Months Ended Sep 30 (in thousands) | Cash Flow Activity | 2019 | 2018 | | :--- | :--- | :--- | | Net Cash Used In Operating Activities | $(14,899) | $(9,005) | | Net Cash Used In Investing Activities | $(43) | $0 | | Net Cash Provided By Financing Activities | $13,510 | $24,800 | | Net (Decrease) Increase in Cash | $(1,432) | $15,795 | | Cash at End of Period | $18,296 | $21,044 | Notes to Unaudited Condensed Financial Statements Notes detail the company's clinical-stage status, reliance on Optejet technology, and sufficient cash position - The company is a clinical-stage ophthalmic biopharmaceutical company developing microdose therapeutics using its patented Optejet piezo-print delivery technology[28] - Management believes current cash on hand is sufficient to meet operating and capital requirements for at least the next twelve months from the date of the report's issuance[32] - In July 2019, the company closed a public offering, issuing 5,046,763 shares and receiving net proceeds of approximately $13.0 million[60] - Subsequent to the quarter end, the company announced it is advancing its MicroLine program and deferring others, expecting cost savings of $1.5 million to $1.9 million in 2020[79] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses its business strategy, financial results, and liquidity, attributing increased net loss to R&D activities Overview The company is strategically prioritizing its development pipeline, advancing key programs toward Phase III trials and NDA submission - The company is advancing its MicroLine program for presbyopia towards Phase III development and plans to initiate and complete the Phase III VISION trials in 2020[84][85] - The Phase III CHAPERONE study for MicroPine (progressive myopia) began enrolling patients in June 2019, with enrollment expected to complete in 2020[85] - Following positive results from the MIST-1 and MIST-2 Phase III trials for MicroStat (mydriasis), the company plans to submit an NDA to the FDA in 2020[85] Results of Operations Operating expenses increased year-over-year, driven primarily by expanded clinical trial activities and hiring Research and Development Expenses (in thousands) | Expense Category | Q3 2019 | Q3 2018 | 9 Months 2019 | 9 Months 2018 | | :--- | :--- | :--- | :--- | :--- | | Direct clinical/non-clinical | $1,650 | $1,240 | $6,060 | $3,429 | | Personnel-related | $729 | $675 | $2,254 | $1,726 | | Non-cash stock-based comp. | $255 | $240 | $1,156 | $557 | | Total R&D Expenses | $3,201 | $2,488 | $10,778 | $6,994 | - The increase in R&D expenses was primarily due to an increase in contracted services and hiring as the company expanded its research and development activities[97][101] - G&A expenses for the nine months ended Sep 30, 2019 increased by $1.1 million (28%) compared to the same period in 2018, driven by higher payroll, public company costs, marketing analysis, and rent[102] Liquidity and Capital Resources The company maintains a sufficient cash position with no debt, supported by a recent public offering - The company had a cash balance of $18.3 million and working capital of $16.3 million as of September 30, 2019[103][104] - Management expects current cash to be sufficient to meet operating and capital requirements for at least the next twelve months from the filing date[104] - For the nine months ended September 30, 2019, cash provided by financing activities was $13.5 million, primarily from the July 2019 public offering ($13.0 million net proceeds) and stock option exercises ($0.5 million)[107] Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, Eyenovia is not required to provide information for this item - The company is a smaller reporting company and is not required to provide the information required by this item[112] Controls and Procedures Management concluded that the company's disclosure controls and procedures were effective as of the quarter's end - Based on an evaluation as of September 30, 2019, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective[115] - No changes in internal control over financial reporting occurred during the third quarter of 2019 that materially affected, or are reasonably likely to materially affect, internal controls[116] PART II - OTHER INFORMATION Legal Proceedings The company reported no legal proceedings - None[120] Risk Factors As a smaller reporting company, Eyenovia is not required to provide information for this item - The company is a smaller reporting company and is not required to provide the information required by this item[122] Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales and confirmed full deployment of its IPO proceeds - As of September 30, 2019, all net proceeds from the company's initial public offering have been deployed as described in the final prospectus dated January 24, 2018[127] Other Information The company reported no other information for this item - None[134] Exhibits This section lists the exhibits filed with the quarterly report, including officer certifications