Vor(VOR) - 2021 Q4 - Annual Report

PART I This section details the company's business operations, strategic initiatives, associated risks, and general corporate information Business Vor Biopharma is a clinical-stage cell and genome engineering company focused on treating blood cancers, developing eHSCs and CAR-T therapies Overview and Strategy Vor Bio is a clinical-stage company engineering hematopoietic stem cells for blood cancers, focusing on AML - Vor Bio is a clinical-stage company engineering hematopoietic stem cells (HSCs) to enable the use of targeted therapies post-transplant for blood cancers, with an initial focus on Acute Myeloid Leukemia (AML)[14][15] - The company's core strategy includes demonstrating the safety and efficacy of its lead product VOR33, advancing its in-house CAR-T therapies (VCAR33), developing 'Treatment Systems' that combine eHSCs and CAR-Ts, and establishing in-house cGMP manufacturing[37][41] - The proprietary platform aims to overcome the on-target toxicity of traditional cancer therapies by genetically modifying healthy donor HSCs to remove cell surface targets, thereby protecting them from targeted treatments[17][42] Pipeline and Programs The company's pipeline includes lead candidate VOR33 in Phase 1/2a for AML, and VCAR33 CAR-T programs Product Pipeline and Anticipated Milestones | Program | Modality | Indication | Stage | Anticipated Milestones | | :--- | :--- | :--- | :--- | :--- | | VOR33 + Mylotarg | eHSC + ADC | AML, MDS, MPN | Phase 1/2 | 2H 2022: Initial clinical data | | VCAR33ALLO | CAR-T (Allogeneic) | AML Post-transplant | Preclinical | 1H 2023 IND submission | | VCAR33AUTO | CAR-T (Autologous) | Bridge-to-transplant AML | Phase 1/2 (NMDP-sponsored) | 2022: Initial monotherapy clinical proof-of-concept data | | VOR33 + VCAR33 Treatment System | eHSC + CAR-T | AML | Preclinical | IND filing following initial VOR33 and VCARALLO data | | VOR33-CLL1 + VCAR33-CLL1 Treatment System | Multiplex-edited eHSC + Multi-specific CAR-T | AML | Discovery/Validation | - | - The lead product, VOR33, is an eHSC where the CD33 surface target is removed. It is being evaluated in the VBP101 Phase 1/2a clinical trial for AML patients at high risk of relapse, with initial data expected in the second half of 2022[51][74] - The VCAR33 program consists of two CAR-T therapies targeting CD33: VCAR33AUTO (autologous cells, in an ongoing NMDP-sponsored trial) and VCAR33ALLO (allogeneic cells, IND submission planned for 1H 2023)[86][89] - The company is developing a 'Treatment System' combining VOR33 with VCAR33ALLO, using the same healthy donor cell source for both products to potentially improve persistence and reduce toxicity[97][98] - Discovery efforts are underway for additional targets (CD123, EMR2, CD5) and multiplex engineering to address tumor heterogeneity and escape mechanisms, with the VOR33-CLL1 + VCAR33-CLL1 Treatment System as the first multiplex program[101][104][111] Manufacturing, Commercialization, and Competition The company is establishing in-house manufacturing, targeting AML transplant markets, and navigating competition - The company is building an in-house cGMP clinical manufacturing facility in Cambridge, MA, expected to be operational in 2022 to support its eHSC and CAR-T pipeline[135][49] - The commercial strategy targets the approximately 12,000 annual allogeneic HSCTs performed globally for AML, focusing on the concentrated network of specialized transplant centers[115][116] - Key competitors include companies developing gene-engineered HSCs (Tmunity Therapeutics), CD33-directed therapies (Johnson & Johnson, Amgen, 2seventy bio), and various CAR-T therapies for AML[137][138][139] Intellectual Property and Licensing The company holds exclusive licenses from Columbia University and NIH for its core eHSC and CAR-T intellectual property - The company holds an exclusive worldwide license from Columbia University for patents related to engineering lineage-specific cell surface antigens like CD33 in HSCs, which is central to the VOR33 program[122][147] - An exclusive worldwide license was obtained from the National Institutes of Health (NIH) for intellectual property related to CAR therapies targeting CD33, which underpins the VCAR33 program[126][155] - As of February 28, 2022, the company's owned patent portfolio includes approximately 88 pending U.S. and foreign patent applications, 22 pending U.S. provisional applications, and one granted U.S. patent. The licensed portfolio includes seven granted patents and approximately 46 pending applications[146] Government Regulation The company's cell product candidates are regulated as biologics by the FDA, requiring BLA approval and subject to healthcare laws - The company's cell product candidates are regulated as biologics by the FDA and will require the submission and approval of a Biologics License Application (BLA) for marketing authorization[163] - VOR33 has received Fast Track designation and Orphan Drug Designation (ODD) from the FDA for the treatment of AML, which may facilitate development and provide market exclusivity upon approval[73][186] - The company is subject to extensive U.S. healthcare laws, including the federal Anti-Kickback Statute, False Claims Act, and HIPAA, which regulate business practices, marketing, and data privacy[208][209][211] - The regulatory landscape for genome engineering and gene therapy is novel and evolving, which creates uncertainty regarding the time, cost, and requirements for obtaining regulatory approval[369][370] Risk Factors The company faces substantial risks including net losses, unproven technology, clinical trial safety, manufacturing, and regulatory uncertainties - The company has a history of significant net losses ($68.9 million in 2021) and expects to incur losses for the foreseeable future, requiring substantial additional funding to advance its programs[250][254] - Engineered hematopoietic stem cells (eHSCs) are a novel, unproven technology, and the company's success is highly dependent on its two most advanced candidates, VOR33 and VCAR33[273][277] - There is a significant risk of serious adverse events or undesirable side effects from the company's product candidates, the genome engineering process (e.g., off-target effects), or the associated HSCT and CAR-T procedures (e.g., cytokine release syndrome)[282][284][288] - The company relies on third parties for manufacturing materials and conducting clinical trials, and is highly dependent on intellectual property licensed from Columbia University and the NIH, the termination of which would harm the business[397][411] - The regulatory landscape for genome engineering technology is novel and uncertain, which could lead to unpredictable timelines, costs, and challenges in obtaining approval for product candidates[369] - The COVID-19 pandemic has caused and may continue to cause disruptions, including delays in clinical trial site activation and patient enrollment for the VOR33 Phase 1/2a trial[503][505] Unresolved Staff Comments The company reports that it has no unresolved staff comments from the SEC - Not applicable; the company has no unresolved comments from the SEC staff[547] Properties The company's principal executive office, laboratory, and manufacturing space is located in Cambridge, Massachusetts - The company leases approximately 73,235 square feet of office, lab, and manufacturing space in Cambridge, Massachusetts, under a lease that expires in August 2030[548] Legal Proceedings The company is not currently subject to any material legal proceedings - The company is not currently a party to any material legal proceedings[549] Mine Safety Disclosures This section is not applicable to the company - Not applicable[550] PART II This section covers the company's stock market information, financial performance analysis, and internal controls Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The company's common stock trades on Nasdaq since February 2021, with no dividends paid and IPO proceeds unutilized - The company's common stock trades on the Nasdaq Global Select Market under the symbol 'VOR', commencing on February 5, 2021[553] - The company has never declared or paid cash dividends and does not anticipate doing so in the foreseeable future, intending to retain earnings for business development[555] - The company received net proceeds of $186.3 million from its February 2021 IPO. As of December 31, 2021, none of these proceeds had been used[557][558] Selected Financial Data This section is reserved and contains no information - This item is noted as '[Reserved]' and provides no data[559] Management's Discussion and Analysis of Financial Condition and Results of Operations The company reported a $68.9 million net loss in 2021 due to increased R&D and G&A expenses, with cash to fund operations into Q4 2023 Results of Operations (2021 vs. 2020) | (in thousands) | 2021 | 2020 | Change | | :--- | :--- | :--- | :--- | | Research and development | $47,529 | $31,618 | $15,911 | | General and administrative | $21,489 | $11,748 | $9,741 | | Total operating expenses | $69,018 | $43,366 | $25,652 | | Loss from operations | $(69,018) | $(43,366) | $(25,652) | | Net loss | $(68,899) | $(43,337) | $(25,562) | - Research and development expenses increased by $15.9 million in 2021, driven by higher personnel costs from increased headcount ($10.5 million), increased facilities and other expenses ($2.2 million), and higher external costs for clinical programs and preclinical studies ($3.2 million)[585] - General and administrative expenses rose by $9.8 million in 2021, primarily due to increased personnel costs ($4.6 million), higher professional fees for legal and insurance services ($4.3 million), and increased facility costs ($0.9 million)[586] - As of December 31, 2021, the company had $207.5 million in cash, cash equivalents, and investments. This balance is expected to fund operating expenses and capital requirements into the fourth quarter of 2023[569][592] Cash Flow Summary (2021 vs. 2020) | (in thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Net cash used in operating activities | $(69,144) | $(36,292) | | Net cash used in investing activities | $(91,651) | $(4,161) | | Net cash provided by financing activities | $232,911 | $82,526 | Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, Vor Biopharma is not required to provide the information for this item - The company is a smaller reporting company and is not required to provide this information[625] Financial Statements and Supplementary Data This section refers to the full financial statements and supplementary data appended to the Form 10-K - This item directs to the full financial statements which are appended to the report, starting on page F-1[626] Changes in and Disagreements With Accountants on Accounting and Financial Disclosure The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None reported[627] Controls and Procedures Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2021 - Management concluded that the company's disclosure controls and procedures were effective as of December 31, 2021[628] - Management's assessment concluded that internal control over financial reporting was effective as of December 31, 2021[629] - No attestation report from the independent auditor on internal control is included, as permitted for emerging growth companies[630] Other Information The company reports no other information - None[631] PART III This section provides details on the company's governance, executive compensation, ownership structure, and related party transactions Directors, Executive Officers and Corporate Governance This section provides biographical information for executive officers and non-employee directors, detailing board and committee composition - The company's key executive officers are Robert Ang (President & CEO), Tirtha Chakraborty (Chief Scientific Officer), Nathan Jorgensen (Chief Financial Officer), and Christopher Slapak (Chief Medical Officer)[635] - The Board of Directors is chaired by Matthew Patterson and includes members with extensive experience in biotechnology, finance, and medicine[635][642] - The Audit Committee is chaired by Daniella Beckman, who is qualified as an audit committee financial expert[650] Executive Compensation This section details executive compensation for 2021, including salary, bonuses, equity awards, and severance plans 2021 Summary Compensation Table | Name and Principal Position | Year | Salary ($) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | All Other Compensation ($) | Total ($) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Robert Ang, M.B.B.S. | 2021 | 507,760 | 919,080 | 218,705 | 17,992 | 1,663,537 | | President and CEO | 2020 | 424,173 | 1,619,356 | 211,200 | 500,015 | 2,754,744 | | Tirtha Chakraborty, Ph.D. | 2021 | 384,022 | — | 138,701 | 17,915 | 540,638 | | Chief Scientific Officer | 2020 | 298,439 | 718,008 | 111,784 | 2,059 | 1,177,890 | | Christopher Slapak, M.D. | 2021 | 428,012 | — | 150,593 | 12,043 | 590,648 | | Chief Medical Officer | 2020 | 176,846 | 627,356 | 136,800 | 283,344 | 1,224,346 | - In 2021, target annual performance bonuses were 50% of base salary for the CEO and 40% for the other named executive officers[662] - The company has an Executive Severance and Change in Control Benefits Plan that provides for salary continuation, COBRA payments, and potential bonus payments and equity acceleration upon qualifying terminations, with enhanced benefits if the termination occurs within one year of a change in control[673][674] Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Significant beneficial ownership of common stock is concentrated among key institutional investors and management as of March 1, 2022 Beneficial Ownership as of March 1, 2022 | Name of Beneficial Owner | Percentage of Shares Beneficially Owned | | :--- | :--- | | Greater than 5% stockholders | | | Entities affiliated with RA Capital Healthcare Fund, L.P. | 29.7% | | Entities affiliated with 5AM Ventures VI, L.P. | 17.0% | | PureTech Health LLC | 8.6% | | Entities affiliated with FMR, LLC | 8.5% | | Management | | | All current executive officers and directors as a group (10 persons) | 20.7% | Certain Relationships and Related Transactions, and Director Independence This section details related party transactions, including Series B financing and IPO participation, and confirms director independence - In 2020 and 2021, the company sold Series B preferred stock to related parties, including entities affiliated with RA Capital ($40.0 million), 5AM Ventures ($20.0 million), and FMR, LLC ($19.4 million)[737][738] - Several 5% stockholders, including funds affiliated with RA Capital, 5AM Ventures, and FMR, LLC, purchased an aggregate of $89.5 million of common stock in the company's IPO[742] - In October 2020, the company forgave a $497,920 promissory note, including principal and accrued interest, that was issued to CEO Robert Ang in 2019[743] - The Board of Directors has determined that all directors are independent under Nasdaq Listing Rules, with the exception of CEO Robert Ang[753] Principal Accountant Fees and Services This section outlines the fees billed by Ernst & Young LLP for audit and tax services in 2021 and 2020 Accountant Fees (2021 vs. 2020) | (in thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Audit Fees | $815,623 | $870,000 | | Tax Fees | $62,500 | $0 | | Total | $878,123 | $870,000 | PART IV This section lists all exhibits filed with the annual report and confirms no 10-K summary is provided Exhibits, Financial Statement Schedules This section lists all exhibits filed with the Form 10-K, including corporate documents and material contracts - This item lists all exhibits filed as part of the Annual Report, including corporate governance documents, material contracts, and required certifications[761][763][765] Form 10-K Summary The company indicates that there is no Form 10-K summary - None[767] Financial Statements This section presents the company's audited consolidated financial statements and detailed explanatory notes Consolidated Financial Statements The 2021 consolidated financial statements report a $68.9 million net loss, $242.6 million total assets, and $216.3 million equity Consolidated Balance Sheet Highlights (as of Dec 31) | (in thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Cash and cash equivalents | $119,801 | $48,539 | | Investments | $87,668 | $0 | | Total assets | $242,590 | $75,908 | | Total liabilities | $26,327 | $27,637 | | Total stockholders' equity (deficit) | $216,263 | $(59,065) | Consolidated Statement of Operations Highlights (Year Ended Dec 31) | (in thousands, except per share data) | 2021 | 2020 | | :--- | :--- | :--- | | Total operating expenses | $69,018 | $43,366 | | Net loss | $(68,899) | $(43,337) | | Net loss per share, basic and diluted | $(2.10) | $(230.57) | Notes to Consolidated Financial Statements The notes detail the February 2021 IPO proceeds, license agreements, NOL carryforwards, and expanded facility lease obligations - The company completed its IPO on February 9, 2021, receiving net proceeds of $186.3 million. Upon the IPO, all outstanding redeemable convertible preferred stock converted into common stock[791][792] - As of December 31, 2021, the company had $119.3 million in federal and $109.2 million in state net operating loss (NOL) carryforwards. A full valuation allowance has been recorded against the net deferred tax assets[876][877] - The company is obligated to make potential future payments under its license agreements, including up to $6.3 million in regulatory and commercial milestones to Columbia University and up to $14.0 million in clinical, regulatory, and sales milestones to the NIH[869][871] - In June 2021, the company amended its Cambridge, MA lease, expanding its space by over 40,000 square feet and increasing its total future lease payment obligations[861][862][863]