Wave Life Sciences .(WVE) - 2025 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION Item 1. Financial Statements This section presents Wave Life Sciences Ltd.'s unaudited consolidated financial statements as of June 30, 2025, detailing balance sheets, operations, equity changes, and cash flows, showing decreased cash and revenue, and increased net loss Unaudited Consolidated Balance Sheets This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity as of June 30, 2025, compared to December 31, 2024 Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $208,481 | $302,078 | | Total current assets | $223,556 | $320,394 | | Total assets | $252,355 | $352,207 | | Total current liabilities | $87,408 | $110,953 | | Total liabilities | $105,215 | $134,818 | | Total shareholders' equity | $139,266 | $209,515 | Unaudited Consolidated Statements of Operations and Comprehensive Loss This section details the company's financial performance, including revenue, expenses, and net loss for the three and six months ended June 30, 2025, and 2024 Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $8,699 | $19,692 | $17,874 | $32,230 | | Research and development | $43,469 | $40,393 | $84,091 | $73,840 | | General and administrative | $17,989 | $14,296 | $36,346 | $27,845 | | Loss from operations | $(52,759) | $(34,997) | $(102,563) | $(69,455) | | Net loss | $(50,469) | $(32,923) | $(97,347) | $(64,481) | | Net loss per share | $(0.31) | $(0.25) | $(0.60) | $(0.50) | Unaudited Consolidated Statements of Cash Flows This section outlines the cash inflows and outflows from operating, investing, and financing activities for the six months ended June 30, 2025, and 2024 Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(109,051) | $(60,900) | | Net cash used in investing activities | $(471) | $(469) | | Net cash provided by financing activities | $15,848 | $15,163 | | Net decrease in cash, cash equivalents, and restricted cash | $(93,573) | $(46,361) | Notes to Unaudited Consolidated Financial Statements This section provides additional details and explanations for the financial statements, including business overview, liquidity, and revenue recognition - The company is a clinical-stage biotechnology firm focused on RNA medicines, with a diversified pipeline including programs in obesity, AATD, DMD, and HD[28] - As of June 30, 2025, the company had $208.5 million in cash and cash equivalents and expects this to be sufficient to fund operations for at least the next twelve months. An additional $24.9 million was raised post-quarter end via its at-the-market program[32] - Revenue from the GSK Collaboration Agreement was $8.7 million for Q2 2025 and $17.9 million for the first six months of 2025. As of June 30, 2025, unsatisfied performance obligations under the agreement totaled approximately $66.2 million[53][57] - The Takeda collaboration expired in October 2024, resulting in no revenue from this agreement in 2025, compared to $0.8 million in the first six months of 2024[60][61] Research and Development Expenses by Program (in thousands) | Program | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | AATD program | $1,846 | $3,292 | | INHBE program (Obesity) | $3,515 | $6,054 | | DMD program | $2,681 | $5,719 | | HD program | $789 | $1,956 | | Other R&D expenses | $34,638 | $67,070 | Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's business, clinical pipeline progress, financial results, and liquidity, noting decreased revenue, increased expenses, and sufficient cash for the next twelve months Overview and Current Programs This section provides an overview of the company's clinical-stage biotech platform and updates on key development programs in obesity, AATD, DMD, and HD - The company is a clinical-stage biotech utilizing its PRISM® platform to develop RNA medicines across four modalities: RNA editing (AIMers), RNA interference (siRNA), splicing, and antisense silencing[72][75] - Obesity (WVE-007): Initiated INLIGHT, a Phase 1 trial in obesity, in February 2025. Dosing is complete in the expanded 240 mg cohort, with data expected in Q4 2025[83][85] - AATD (WVE-006): First-ever clinical demonstration of RNA editing in humans. Data from the 200 mg single and multidose cohorts of the RestorAATion-2 trial are expected in Q3 2025. The program is exclusively licensed to GSK[88][89][90] - DMD (WVE-N531): Positive 48-week data from the FORWARD-53 trial showed statistically significant functional improvement. The company plans to file a New Drug Application (NDA) in 2026 for accelerated approval with monthly dosing[97][99] - HD (WVE-003): Positive Phase 1b/2a data showed significant reduction in mHTT. The company is preparing for a global Phase 2/3 study and expects to submit an IND in H2 2025[105][107] Results of Operations This section analyzes the company's financial performance for the three and six months ended June 30, 2025, compared to 2024, focusing on revenue, expenses, and net loss Comparison of Results for the Three Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $8,699 | $19,692 | $(10,993) | | Research and development | $43,469 | $40,393 | $3,076 | | General and administrative | $17,989 | $14,296 | $3,693 | | Net loss | $(50,469) | $(32,923) | $(17,546) | - The decrease in Q2 2025 revenue was primarily driven by lower revenue recognized under the GSK Collaboration Agreement[126] - The increase in Q2 2025 R&D expenses was mainly due to a $6.8 million increase in unallocated R&D costs and a $1.9 million increase for the INHBE (obesity) program, partially offset by decreases in spending on the HD, DMD, and AATD programs[128][131] Comparison of Results for the Six Months Ended June 30 (in thousands) | Metric | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $17,874 | $32,230 | $(14,356) | | Research and development | $84,091 | $73,840 | $10,251 | | General and administrative | $36,346 | $27,845 | $8,501 | | Net loss | $(97,347) | $(64,481) | $(32,866) | Liquidity and Capital Resources This section discusses the company's cash position, funding sources, and cash flow activities, confirming sufficient liquidity for the next twelve months - As of June 30, 2025, the company had cash and cash equivalents of $208.5 million. Subsequent to the quarter-end, it received an additional $24.9 million in net proceeds from its "at-the-market" equity program[140] - Management expects that existing cash and cash equivalents are sufficient to fund operations for at least the next twelve months[141] - Net cash used in operating activities increased to $109.1 million for the six months ended June 30, 2025, from $60.9 million in the same period of 2024, primarily due to a higher net loss and changes in operating assets and liabilities[145][146] - Net cash provided by financing activities was $15.8 million for the first six months of 2025, mainly from $12.4 million in proceeds from the "at-the-market" equity program and $3.0 million from share option exercises[149] Quantitative and Qualitative Disclosures About Market Risk The company identifies primary market risks including interest rates, foreign exchange, inflation, and capital market volatility, none of which materially impacted financial results - The company's primary market risk exposures are from interest rates, foreign currency exchange rates, inflation, and capital market volatility[158] - Changes in foreign currency exchange rates and inflation did not have a material impact on financial results for the reported periods[160][161] Controls and Procedures Management concluded the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - Based on an evaluation as of June 30, 2025, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective[163] - There were no changes in internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, such controls[164] PART II - OTHER INFORMATION Legal Proceedings The company is not currently involved in any material legal proceedings - The company is not currently a party to any material legal proceedings[165] Risk Factors This section refers readers to the comprehensive risk factors detailed in the company's 2024 Annual Report on Form 10-K - The company directs investors to review the risk factors detailed in its 2024 Annual Report on Form 10-K[166] Other Information This section discloses the adoption of Rule 10b5-1 trading plans by two executive officers, the CEO and CTO, for potential sales of company shares - During Q2 2025, two executive officers adopted Rule 10b5-1 trading plans for the sale of company securities[171] - On May 19, 2025, CEO Paul B. Bolno adopted a plan for the sale of up to 2,563,388 ordinary shares, active until November 15, 2025[172] - On May 16, 2025, CTO Chandra Vargeese adopted a plan for the sale of up to 94,600 ordinary shares, active until November 20, 2025[173]