Achieve Life Sciences(ACHV) - 2020 Q4 - Annual Report

Financial Performance - The company reported a net loss of $14.7 million for the year ended December 31, 2020, with an accumulated deficit of$60.4 million[270]. - The company has not generated any revenue from product sales to date and may not do so in the near future[303]. - The company has incurred an accumulated deficit of $60.4 million through December 31, 2020, and expects to incur substantial additional losses in the future[303]. - Net cash used in operating activities for the year ended December 31, 2020 was$13.5 million, a decrease from $15.2 million in 2019, primarily due to reduced research and development expenses[320]. - Net cash provided by financing activities for the year ended December 31, 2020 was$32.7 million, significantly higher than $17.3 million in 2019, driven by multiple public offerings and warrant exercises[321]. Cash and Capital - As of December 31, 2020, the company had cash and cash equivalents of$35.9 million and positive working capital of $34.0 million[270]. - The company entered into a share and unit purchase agreement with Lincoln Park Capital Fund, allowing the sale of up to$11.0 million in shares of common stock[304]. - The company has sold an aggregate of 27,868 shares of common stock under the Purchase Agreement, resulting in gross proceeds of approximately $4.4 million[305]. - The December 2019 public offering generated total gross proceeds of$13.8 million, with net proceeds of $12.3 million after deducting$1.5 million in underwriting discounts and commissions[312]. - In April 2020, the company completed a private placement raising approximately $1.9 million from the sale of 280,782 units, each consisting of one share of common stock and a warrant[313]. - The July 2020 registered direct offering raised approximately$6.0 million, with net proceeds of approximately $5.3 million after deducting placement agent fees[315]. - The August 2020 public offering raised total gross proceeds of approximately$7.5 million, resulting in net proceeds of approximately $6.8 million after expenses[317]. - The December 2020 public offering raised total gross proceeds of approximately$17.3 million, with net proceeds of approximately $15.8 million after deducting underwriting discounts and commissions[319]. Research and Development - Research and development expenses for 2020 were$6.9 million, a decrease of 29% from $9.7 million in 2019, primarily due to the completion of the ORCA-1 trial[299]. - Research and development expenses are expected to increase as the company continues ongoing nonclinical studies and initiates new clinical trials[296]. - The company has completed two chronic toxicology studies and is in progress with one carcinogenicity study as part of its drug application process[284]. Clinical Trials and E-Cigarette Studies - In the Phase 2b ORCA-1 trial, cytisinicline treatment arms showed a 74-80% median reduction in the number of cigarettes smoked compared to a 62% reduction in placebo arms[273]. - The ORCA-1 trial demonstrated a 54% abstinence rate at week 4 for the 3 mg TID cytisinicline arm compared to 16% for placebo (p<0.0001)[275]. - The RAUORA trial indicated that cytisinicline achieved a continuous abstinence rate of 12.1% at 6 months compared to 7.9% for varenicline, with a Relative Risk of 1.55[280]. - Cytisinicline was well-tolerated with no serious adverse events reported, and significantly fewer nausea adverse events compared to varenicline (p<0.001)[279]. - The company is considering clinical studies for e-cigarette users, with nearly 14 million adult users in the U.S. reported in 2018[282]. - Approximately 73% of surveyed e-cigarette users indicated they intend to quit vaping within the next 3 to 12 months, with over half willing to try a new prescription product[282]. - The company is developing a Phase 2 clinical trial protocol, ORCA-V1, to evaluate cytisinicline for e-cigarette users and is seeking non-dilutive funding for this trial[283]. Impact of COVID-19 - The impact of the COVID-19 pandemic has caused delays in clinical trial enrollment, with expectations for completion now pushed to mid-2021[285]. Accounting and Financial Reporting - The adoption of the new lease accounting standard (Topic 842) had a material impact on the consolidated balance sheets, specifically through the recognition of right-of-use (ROU) assets and lease liabilities for operating leases[335]. - The company elected the short-term lease recognition exemption for all qualifying leases, meaning ROU assets and lease liabilities will not be recognized for those leases[333]. - The adoption of Accounting Standards Update 2018-13 on fair value measurement did not have a significant impact on the company's financial position or results of operations[335]. - The consolidated balance sheets as of December 31, 2020, and 2019, reflect the changes due to the new lease accounting standard[337]. - The consolidated statements of loss and comprehensive loss for the years ended December 31, 2020, 2019, and 2018 were not impacted by the new lease accounting standard[335]. - The company implemented internal controls to prepare financial information in accordance with the new lease accounting standard[333]. - The new lease accounting standard requires lessees to recognize leases on-balance sheet for all leases with a term longer than 12 months[332]. - The company did not provide disclosures required under the new standard for periods before January 1, 2019[333]. - The accounting for finance leases remained substantially unchanged after the adoption of the new standard[335]. - There were no applicable quantitative and qualitative disclosures about market risk provided in the report[335].