Aligos Therapeutics(US:ALGS)2024-08-06 20:14Cash and Cash Equivalents - Cash and cash equivalents decreased from $135,704 thousand to $45,078 thousand, a significant drop of 66.8%[26] - Cash and cash equivalents decreased by $90.6 million to $45.1 million as of June 30, 2024[38] - Fair value of cash equivalents as of June 30, 2024: $45.1 million[82] - Unrestricted cash, cash equivalents, and investments totaled $94.5 million as of June 30, 2024[47] - As of June 30, 2024, the company had cash, cash equivalents, and investments of $94.5 million[139] - As of June 30, 2024, the company had total stockholders' equity of $67.2 million and cash, cash equivalents, and investments of $94.5 million[168][172] Total Current Assets and Liabilities - Total current assets declined from $141,084 thousand to $99,570 thousand, a decrease of 29.4%[26] - Total liabilities decreased from $59,447 thousand to $41,582 thousand, a reduction of 30.1%[26] - Accrued liabilities decreased from $16.842 million as of December 31, 2023 to $12.064 million as of June 30, 2024[63] Research and Development Expenses - Research and development expenses increased from $16,781 thousand to $21,099 thousand, up 25.7% for the three months ended June 30, 2024[28] - Research and development expenses increased by $4.3 million during the three months ended June 30, 2024, compared to the same period in 2023[134] - Total direct research and development expenses for the six months ended June 30, 2024 were $20.13 million, compared to $14.73 million in 2023[125] Net Income and Loss - Net income for the three months ended June 30, 2024 was $5,061 thousand, compared to a net loss of $18,791 thousand in the same period last year[28] - Net loss for the six months ended June 30, 2023, was $41.7 million[38] - Net income for the three months ended June 30, 2024, was $5.06 million, compared to a net loss of $18.79 million for the same period in 2023[106] - Net loss for the six months ended June 30, 2024, was $29.80 million, compared to a net loss of $41.75 million for the same period in 2023[106] - The company incurred net losses of $29.8 million and $41.7 million for the six months ended June 30, 2024 and 2023, respectively[119] - The company incurred a net loss of $29.8 million for the six months ended June 30, 2024, and $87.7 million for the year ended December 31, 2023[168] Stock-Based Compensation - Stock-based compensation expense related to employee stock awards was $1,918 thousand for the three months ended June 30, 2024[31] - Stock-based compensation expense for the six months ended June 30, 2023, was $6.9 million[38] - Stock option compensation expense was $4.4 million for the six months ended June 30, 2024, down from $6.5 million in the same period of 2023[72] - Employee stock purchase plan stock-based compensation expense for the six months ended June 30, 2024: $0.3 million[77] - Total stock-based compensation expense for the six months ended June 30, 2024: $4.7 million[78] Revenue and Collaborations - Revenue from collaborations for the six months ended June 30, 2024 was $292 thousand, down 94.4% from $5,175 thousand in the same period last year[28] - Revenue from collaborations decreased by $2.6 million and $4.9 million, respectively, for the three and six months ended June 30, 2024[132] - Revenue from customers decreased by $3.2 million and $2.7 million, respectively, for the three and six months ended June 30, 2024[133] - The company recognized $0.3 million in revenue from collaborative arrangements related to upfront payments during the three months ended June 30, 2024[93] - The company recognized $1.8 million in revenue from customers related to upfront payments during the three months ended June 30, 2024[101] Accumulated Deficit - Accumulated deficit increased from $486,797 thousand to $516,599 thousand, reflecting a 6.1% increase in losses[26] - Accumulated deficit increased to $516.6 million as of June 30, 2024[46] - The company has an accumulated deficit of $516.6 million as of June 30, 2024[119] Stock and Equity - Weighted average shares of common stock, basic increased from 43,215,478 to 156,444,408, a significant rise of 261.9%[28] - Total stockholders' equity decreased from $92,080 thousand to $67,229 thousand, a decline of 27.0%[26] - The company increased authorized voting common stock from 300 million to 500 million shares on June 27, 2024[64] - In October 2023, the company raised $92.1 million through a PIPE offering, issuing common stock, pre-funded warrants, and common warrants[66] - Pre-funded warrants outstanding decreased from 81,054,686 at January 1, 2024 to 76,929,155 at June 30, 2024 due to exercises[68] - Common warrant liability decreased from $27.596 million at January 1, 2024 to $11.490 million at June 30, 2024 due to fair value changes[69] - Outstanding options as of June 30, 2024: 10,041,963 with a weighted average exercise price of $2.04 and a remaining contractual term of 8.20 years[73] - Options vested and exercisable as of June 30, 2024: 3,436,608 with a weighted average exercise price of $3.70 and a remaining contractual term of 5.97 years[73] - Weighted-average grant date fair value of options granted during the six months ended June 30, 2024: $0.74 per share[73] - Stock option exchange program in January 2024: 3,880,332 eligible options canceled and 1,906,153 replacement options granted[74] - Restricted stock units unamortized expense balance as of June 30, 2024: $43 thousand to be amortized over 3.0 years[75] - The company raised $92.1 million in gross proceeds from a private placement in October 2023[172] Property and Equipment - Total property and equipment net value decreased from $3.259 million as of December 31, 2023 to $2.797 million as of June 30, 2024[57] - Depreciation expense for the six months ended June 30, 2024 was $0.5 million, compared to $0.9 million for the same period in 2023[57] Interest Income and Expense - The company recorded interest income of $0.9 million for the six months ended June 30, 2024, down from $1.7 million in the same period of 2023[61] - Interest income, net decreased by $0.6 million and $0.8 million for the three and six months ended June 30, 2024, respectively, due to a general decrease in market interest rates[138] Other Income and Expenses - Other income, net increased by $31.2 million and $17.6 million for the three and six months ended June 30, 2024, respectively, due to the change in fair value of Common Warrants[138] - The company recorded income tax expense of $213.0 thousand for the six months ended June 30, 2024, primarily related to international operations[104] Cash Flow - Operating activities utilized $42.2 million of cash during the six months ended June 30, 2024, primarily due to a net loss of $29.8 million[150] - Investing activities used $48.6 million of cash during the six months ended June 30, 2024, primarily due to $88.6 million in purchases of short-term investments[151] - Net cash provided by financing activities was $262.0 thousand during the six months ended June 30, 2024, primarily from ESPP purchases[152] - Maturities of short-term investments provided $45.0 million in cash during the six months ended June 30, 2023[38] Future Funding and Capital Requirements - The company expects its existing cash and investments to fund operations for at least 12 months[49] - The company may seek additional funding through equity offerings, debt financings, or collaborations[49] - The company believes its existing cash, cash equivalents, and investments will fund planned operating expenses and capital expenditures for at least the next twelve months[143] - The company may raise additional capital on an opportunistic basis to fund operations[143] - The company's existing cash, cash equivalents, and investments are expected to fund operations for at least 12 months following the report date[175] - The company's future capital requirements depend on factors such as clinical trial costs, regulatory approval timelines, and commercialization expenses[173] - The company's ability to raise additional funds may be limited by market conditions and SEC regulations, potentially impacting its development and commercialization efforts[176][177] Clinical Trials and Drug Development - The company is focused on developing therapeutics for viral and liver diseases, including MASH, CHB, and coronaviruses[44] - The company has not generated any product revenue to date[45] - ALG-055009, the company's potential best-in-class THR-β agonist for MASH, completed Phase 1 studies and initiated Phase 2a HERALD study with topline data expected in early Q4 2024[113] - ALG-000184, the company's CAM-E for CHB, demonstrated sustained HBV DNA suppression in 90% of HBeAg-positive CHB subjects and complete suppression in 100% of HBeAg-negative CHB subjects in Phase 1b studies[116] - The company received supportive feedback from the FDA regarding chronic suppressive therapy with ALG-000184, with the potential for superiority to standard of care in future clinical studies[116] - The company selected two lead molecules for small molecule inhibitors of PD-L1 and completed scale-up for further advancement towards clinical development[116] - ALG-097558 is at least 6-fold more potent than nirmatrelvir and other PIs in clinical development against SARS-CoV-2 variants, including Omicron[117] - The projected efficacious dose range for ALG-097558 to treat SARS-CoV-2 is 200-600 mg Q12 x 5 days[117] - The company expects to receive approximately $13.8 million in funds from NIH awards and contracts to support coronavirus-related activities[118] - The company entered into a clinical trial collaboration and supply agreement with Amoytop in July 2024 to evaluate the efficacy and safety of ALG-000184 in combination with PEGBING® in CHB patients in China[111] - The company halted development of ALG‑010133 in January 2022 due to insufficient HBsAg reduction at projected efficacious doses, and discontinued ALG‑020572 in March 2022 due to serious adverse events[210] - The siRNA drug candidate ALG-125755 showed evidence of HBsAg lowering in Phase 1 studies, but further advancement requires additional external funding[211] - The company is investing significant resources in developing treatments for MASH, including ALG-055009, currently in Phase 2a trials, but success is not guaranteed[220] Regulatory and Compliance - The company has not previously submitted a new drug application (NDA) to the FDA, and regulatory approval for drug candidates is uncertain[197] - The company plans to seek regulatory approval for drug candidates in the United States and select foreign countries, requiring compliance with varying regulatory requirements[199] - Regulatory approval processes by the FDA, EMA, and other authorities are lengthy, unpredictable, and may require additional studies or trials beyond initial plans[204][206] - The company may fail to obtain regulatory approval if clinical trial results do not meet statistical significance or if manufacturing processes are deemed deficient[206] - Even if approved, regulatory authorities may limit indications, require costly post-marketing trials, or restrict labeling claims, impacting commercialization prospects[208] - The company has not yet obtained regulatory approval for any drug candidate, and there is no guarantee that current or future candidates will be approved[205] - Delays or failures in clinical trials could significantly harm the company's business, financial condition, and ability to generate revenue[209] - Failure to comply with Nasdaq's continued listing requirements could result in delisting, negatively impacting the company's stock price and access to capital markets[181][182] - The company's common stock began trading on the Nasdaq Capital Market on March 6, 2024, with a compliance period ending on September 3, 2024, to regain the minimum bid price requirement of $1.00 per share[183] - A reverse stock split is expected to be completed in August 2024, aiming to achieve a share price exceeding $1.00 to comply with Nasdaq listing standards[185] - The company faces potential delisting from Nasdaq, which could negatively impact stock liquidity, trading volume, and the ability to raise capital[187] Risks and Uncertainties - The company expects to continue incurring significant losses for the foreseeable future and may never achieve profitability[166][168] - The company's ability to generate revenue depends on successful completion of clinical trials, regulatory approvals, and commercialization of drug candidates[169][170] - The company's operating results may fluctuate significantly due to factors such as clinical trial enrollment, regulatory approvals, and manufacturing costs[178][179] - Health pandemics or epidemics could materially adversely affect the company's business, particularly in regions with significant manufacturing facilities or clinical trial sites[188] - COVID-19-related restrictions, including shelter-in-place orders, have previously disrupted the company's operations and could continue to impact productivity and clinical programs[189] - Supply chain disruptions due to health pandemics or epidemics may delay or limit the company's ability to obtain materials for drug candidates[190] - Clinical trials may be delayed due to health pandemics, affecting site initiation, patient enrollment, and the ability to recruit and retain investigators[191] - The company's drug candidates are in early-stage development, with clinical trials initiated in multiple countries, but there is no guarantee of efficacy or safety[194] - Clinical trials for drug candidates are being conducted in multiple countries including New Zealand, Hong Kong, and the United Kingdom, with potential future trials in additional regions[214] - Delays in clinical trials could harm the commercial prospects of drug candidates, increase costs, and allow competitors to bring products to market first[215] - Potential disruptions from another pandemic or epidemic could affect clinical trial sites, patient enrollment, and supply chain for materials, particularly impacting trials for ALG‑055009, ALG-000184, and ALG-097558[216] - The BIOSECURE Act, if enacted, could restrict the company's ability to collaborate with certain Chinese biotechnology companies, potentially impacting contractual relationships[217] - Principal investigators for clinical trials may have financial relationships with the company, which could raise concerns about data integrity and regulatory approval[218] Licensing and Collaboration Agreements - License agreement with Emory University: potential milestone payments up to $125.0 million and tiered single-digit royalties on net sales[86] - License agreement with Luxna Biotech: potential milestone payments up to $55.5 million and low-single digit royalty percentage on net sales[90] - The company entered into a Research, Licensing and Commercialization Agreement with KU Leuven, with potential payments totaling up to $62.0 million for commercial sales and development milestones, and a low-to-mid-single digit royalty percentage on net sales[91] - The company received an upfront payment of $12 million from Merck and is eligible for up to $458.0 million in development and commercialization milestones, plus tiered royalties on net sales[92] - The company received an additional upfront payment of $15 million from Merck for a second MASH target, with potential payments of up to $460.0 million in milestones and tiered royalties[93] - The company received an upfront payment of $7.0 million from Amoytop, with potential payments of up to $109.0 million in development and commercialization milestones and tiered royalties[100] - The company received an additional upfront payment of $1.5 million from Amoytop in May 2024 for a nine-month extension of the Development Agreement[100] Grants and Awards - The company was awarded a $1.1 million grant by the NIH in 2022, with additional grants of $1.4 million in 2023 and $1.5 million in 2024[95][97] - The company was awarded an $8.5 million contract by the NIAID in 2023, with an additional $1.3 million awarded in 2024, bringing the total contract value to $9.8 million[97] - The company expects to receive approximately $13.8 million in funds from NIH awards and contracts to support coronavirus-related activities[118] General and Administrative Expenses - General and administrative expenses decreased by $2.9 million during the three months ended June 30, 2024, compared to the same period in 2023[135] - General and administrative expenses decreased by $4.7 million during the six months ended June 30, 2024, primarily due to reduced legal and IP spend, facility expenses, and employee-related costs[137] Nonclinical Development - Nonclinical development is a complex and lengthy process, often taking several years or more per program, with potential delays due to regulatory requirements, study design consensus, and global-scale events[203]