Assembly Biosciences(ASMB) - 2025 Q1 - Quarterly Report

PART I: FINANCIAL INFORMATION Financial Statements The company reported a reduced net loss in Q1 2025, with assets decreasing and collaboration revenue increasing Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $23,413 | $38,344 | | Marketable securities | $67,615 | $73,735 | | Total Assets | $99,017 | $119,168 | | Deferred revenue (short & long-term) | $63,581 | $73,000 | | Total Liabilities | $71,884 | $85,809 | | Total Stockholders' Equity | $27,133 | $33,359 | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Account | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Collaboration revenue | $9,419 | $5,785 | | Research and development | $14,851 | $11,879 | | General and administrative | $4,509 | $4,635 | | Loss from operations | $(9,941) | $(10,729) | | Net loss | $(8,818) | $(9,077) | | Net loss per share, basic and diluted | $(1.17) | $(1.66) | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(23,439) | $(18,364) | | Net cash provided by investing activities | $6,586 | $17,272 | | Net cash provided by financing activities | $1,922 | $— | | Net decrease in cash and cash equivalents | $(14,931) | $(1,092) | Notes to Financial Statements Notes detail the company's biotech focus, financial sufficiency, and key Gilead collaboration terms - The company is a biotechnology firm developing therapeutics for viral diseases including genital herpes, hepatitis B (HBV), hepatitis D (HDV), and transplant-related herpesviruses[19] - Management believes current funds are sufficient to meet operating requirements for at least the next twelve months from the report's issuance date[20] - The collaboration with Gilead is a significant component of operations. In Q1 2025, the company recognized $9.4 million in collaboration revenue, up from $5.8 million in Q1 2024[32][58] - The transaction price for the Gilead agreement was amended to $74.2 million, consisting of the unrecognized portion of the original contract, a $5.2 million premium on a stock purchase, and a $10.0 million payment from an amendment[54] - During Q1 2025, the company sold 161,645 shares of common stock under its "at-the-market" (ATM) offering, receiving net proceeds of $1.9 million[41] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses clinical pipeline progress, increased revenue and R&D, and future funding outlook - The company's pipeline includes clinical-stage therapies for recurrent genital herpes (HPIs), hepatitis delta virus (HDV entry inhibitor), and hepatitis B virus (HBV CAM), as well as a program for transplant-related herpesviruses[62] - The company expects its existing cash, cash equivalents, and marketable securities will fund operating expenses and capital expenditure requirements into the middle of 2026[122] R&D Expense Breakdown (in thousands) | Program | Q1 2025 | Q1 2024 | $ Change | | :--- | :--- | :--- | :--- | | 5366 (Herpes) | $1,680 | $377 | $1,303 | | 1179 (Herpes) | $734 | $1,040 | $(306) | | 6250 (HDV) | $2,445 | $1,027 | $1,418 | | 4334 (HBV) | $426 | $553 | $(127) | | 7423 (Transplant) | $752 | $— | $752 | | Total R&D Expenses | $14,851 | $11,879 | $2,972 | - Net cash used in operating activities increased to $23.4 million in Q1 2025 from $18.4 million in Q1 2024, primarily due to increased operating expenses from advancing the clinical pipeline[119] Quantitative and Qualitative Disclosures About Market Risk This section is not applicable for the registrant, as it qualifies as a smaller reporting company - The company has indicated that this item is not applicable[126] Controls and Procedures Management evaluated disclosure controls and procedures, concluding they were effective with no material changes - The Chief Executive Officer and President concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of the end of the period[127] - No changes in internal control over financial reporting occurred during the quarter ended March 31, 2025, that materially affected, or are reasonably likely to materially affect, internal controls[128] PART II: OTHER INFORMATION Legal Proceedings The company is not currently involved in any material legal proceedings - The company is not a party to any material legal proceedings[130] Risk Factors The company faces significant risks from unapproved products, financial needs, and third-party and IP dependencies - The company has no approved products and its future success depends on obtaining regulatory approval for its pipeline candidates, which is uncertain[132] - The company has a history of losses and will need additional financing to complete development. Failure to raise capital could force it to scale back or discontinue operations[137][138] - The collaboration with Gilead is critical. Risks include potential conflicts, Gilead choosing not to exercise its options, and dependence on Gilead for development and commercialization of optioned programs[140][142] - The company relies on third-party CROs and manufacturers, which reduces control over clinical studies and manufacturing and introduces risks related to performance, compliance, and supply chain interruptions[146][153] - The business depends on protecting its intellectual property through patents and trade secrets, but these protections may be inadequate, challenged by third parties, or difficult to enforce globally[190][191] Unregistered Sales of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities during the period covered by this report - None[208] Exhibits The report includes exhibits such as the CEO's certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, as well as Inline XBRL documents - Filed exhibits include CEO certifications (31.1, 32.1) and Inline XBRL data files (101.INS, 101.SCH, 104)[212]