Viridian Therapeutics(US:VRDN)2025-08-06 11:09PART I. FINANCIAL INFORMATION Financial Statements This section presents the unaudited condensed consolidated financial statements for the quarter ended June 30, 2025, including balance sheets, statements of operations, stockholders' equity, and cash flows, with a net loss of $187.6 million and an accumulated deficit of $1.18 billion as of June 30, 2025 Condensed Consolidated Balance Sheet Highlights (in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $117,324 | $99,594 | | Short-term investments | $446,032 | $617,990 | | Total assets | $582,324 | $742,403 | | Liabilities & Equity | | | | Total liabilities | $67,155 | $70,764 | | Total stockholders' equity | $515,169 | $671,639 | | Accumulated deficit | $(1,183,504) | $(995,857) | Condensed Consolidated Statements of Operations (in thousands, except per share data) | | Three Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | | | 2025 | 2024 | 2025 | 2024 | | Collaboration revenue - related party | $75 | $72 | $147 | $144 | | Research and development | $86,626 | $56,193 | $163,461 | $97,136 | | General and administrative | $20,216 | $16,066 | $37,319 | $31,091 | | Loss from operations | $(106,767) | $(72,187) | $(200,633) | $(128,083) | | Net loss | $(100,735) | $(64,993) | $(187,647) | $(113,535) | | Net loss per share, basic and diluted | $(1.00) | $(0.77) | $(1.87) | $(1.37) | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | | Six Months Ended June 30, | | :--- | :--- | | | 2025 | 2024 | | Net cash used in operating activities | $(168,026) | $(91,281) | | Net cash provided by (used in) investing activities | $175,780 | $(81,069) | | Net cash provided by financing activities | $9,976 | $177,190 | | Net increase in cash and cash equivalents | $17,730 | $4,840 | Note 1: Description of Business and Liquidity This note details the company's focus on developing medicines for rare diseases, its accumulated deficit of $1.18 billion, and its $563.4 million in cash and investments, sufficient to fund operations for at least the next twelve months - The company's most advanced program is veligrotug, a monoclonal antibody targeting IGF-1R for the treatment of Thyroid Eye Disease (TED), also developing VRDN-003 and a portfolio of FcRn inhibitors (VRDN-006, VRDN-008) for autoimmune diseases2728 - As of June 30, 2025, the company had an accumulated deficit of $1.18 billion and expects to continue generating operating losses for the foreseeable future29 - The company had approximately $563.4 million in cash, cash equivalents, and short-term investments as of June 30, 2025, and believes these resources are sufficient to fund operations and capital expenditures for at least the next twelve months31 Note 5: Debt This note outlines the company's amended loan agreement with Hercules Capital, providing access to $150.0 million, with $20.0 million drawn and an interest-only period extended to April 2026 - The amended term loan with Hercules Capital provides access to up to $150.0 million, with $20.0 million drawn as of the report date8586 - The interest-only payment period was extended to April 1, 2026, due to the achievement of development milestones related to positive topline results from the Phase 3 THRIVE and THRIVE-2 trials88 Debt Summary (as of June 30, 2025, in thousands) | Component | Amount | | :--- | :--- | | Gross term loan proceeds | $20,000 | | Accrued end-of-term fee | $788 | | Total debt | $20,788 | | Less: current portion | $(8,435) | | Long-term debt, net | $12,353 | Note 6: Collaboration Agreements This note details collaboration agreements, including a license with Zenas BioPharma generating minor revenue and related-party agreements with Paragon Therapeutics resulting in $4.5 million in R&D costs in H1 2025 - The license agreement with Zenas BioPharma for IGF-1R antibody products in China was sublicensed to Zai Lab in January 2025, with the company recognizing $0.1 million in related collaboration revenue in H1 20259295 - The agreements with Paragon Therapeutics are considered related-party transactions, with the company recording $4.5 million in R&D costs in H1 2025, including a $3.5 million payment for achieving R&D objectives and a $1.0 million clinical milestone payment103104105 Note 7: Commitments and Contingencies This note describes significant financial commitments, including potential milestone payments of up to $48.0 million to ImmunoGen and $45.0 million to Enable Injections, plus $2.7 million in future minimum lease obligations - The company is obligated to make potential future development milestone payments of up to $48.0 million to ImmunoGen (acquired by AbbVie) and up to $45.0 million to Enable Injections upon achieving specified milestones107110 Future Lease Payments (as of June 30, 2025, in thousands) | Period | Amount | | :--- | :--- | | 2025 (remainder) | $367 | | 2026 | $748 | | 2027 | $613 | | 2028 | $627 | | 2029 | $370 | | Total future minimum lease payments | $2,725 | Note 8: Capital Stock This note details the company's capital structure, including a new $300.0 million ATM sales agreement established in March 2025 and a $150.0 million public offering completed in January 2024 - In March 2025, the company entered into a new Open Market Sale Agreement (ATM) with Jefferies for up to $300.0 million of its common stock, terminating the prior September 2022 ATM agreement, with no shares sold under the new agreement during the quarter124 - In January 2024, the company raised approximately $150.0 million in gross proceeds from a public offering of 7,142,858 shares of common stock125 Note 10: Share-Based Compensation This note reports $10.8 million in share-based compensation expense for Q2 2025 and $21.1 million for H1 2025, alongside stockholder approval for an 8,000,000 share increase to the 2016 Equity Incentive Plan Share-Based Compensation Expense (in thousands) | | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | Research and development | $5,173 | $10,921 | | General and administrative | $5,671 | $10,143 | | Total | $10,844 | $21,064 | - In June 2025, stockholders approved an 8,000,000 share increase to the 2016 Equity Incentive Plan138 - As of June 30, 2025, there was $106.3 million of total unrecognized share-based compensation cost related to stock options and $14.3 million related to unvested RSUs149 Note 13: Subsequent Events This note discloses a July 2025 collaboration and license agreement with Kissei Pharmaceutical for veligrotug and VRDN-003 in Japan, including a $70.0 million upfront payment and potential milestones - The agreement with Kissei includes a $70.0 million upfront payment to Viridian159 - Viridian is eligible to receive up to an additional $315.0 million in development, regulatory, and sales milestones, plus tiered royalties ranging from the twenties to the mid-thirties on future net sales in Japan159 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's financial condition, clinical program progress for TED and FcRn inhibitors, increased R&D and G&A expenses, and a projected cash runway into the second half of 2027 Overview and Recent Developments The company is advancing its pipeline for TED and autoimmune diseases, with veligrotug nearing BLA submission, VRDN-003 in pivotal trials, and FcRn inhibitors progressing towards proof-of-concept data and IND submission - Veligrotug (TED Program): Received FDA Breakthrough Therapy designation in May 2025, with a BLA submission anticipated in H2 2025 and an MAA submission to the EMA in H1 2026170 - VRDN-003 (Subcutaneous TED Program): Pivotal Phase 3 trials (REVEAL-1 and REVEAL-2) are ongoing, with topline data expected in H1 2026 and a BLA submission anticipated by the end of 2026173 - FcRn Inhibitor Program: Proof-of-concept IgG reduction data for VRDN-006 is expected in Q3 2025, and an IND for the half-life extended VRDN-008 is planned for submission by the end of 2025175176 Results of Operations This section compares financial results, highlighting significant increases in R&D expenses due to advancing clinical trials and manufacturing, and higher G&A costs driven by personnel and pre-commercialization activities Comparison of Operating Expenses (in thousands) | | Three Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | | | 2025 | 2024 | 2025 | 2024 | | Research and development | $86,626 | $56,193 | $163,461 | $97,136 | | General and administrative | $20,216 | $16,066 | $37,319 | $31,091 | - R&D expenses for the six months ended June 30, 2025, increased by $66.3 million compared to the same period in 2024, driven by a $41.2 million increase in TED portfolio costs and a $19.7 million increase in FcRn portfolio costs199201204 - G&A expenses for the six months ended June 30, 2025, increased by $6.2 million compared to the prior year period, primarily due to a $4.4 million increase in personnel costs, a $3.3 million increase in market research for veligrotug, and a $2.5 million increase in professional fees205209 Liquidity and Capital Resources As of June 30, 2025, the company had $563.4 million in cash and investments, expected to fund operations into H2 2027, with net cash used in operations increasing to $168.0 million in H1 2025 - The company's cash, cash equivalents, and short-term investments totaled $563.4 million as of June 30, 2025206 - The current cash position is expected to fund planned operations into the second half of 2027206 Summarized Cash Flows (in thousands) | | Six Months Ended June 30, | | :--- | :--- | | | 2025 | 2024 | | Net cash used in operating activities | $(168,026) | $(91,281) | | Net cash provided by (used in) investing activities | $175,780 | $(81,069) | | Net cash provided by financing activities | $9,976 | $177,190 | Quantitative and Qualitative Disclosures about Market Risk The company reports no material changes to its market risks during the six months ended June 30, 2025, compared to its prior annual report disclosures - No material changes to market risks were reported for the period227 Controls and Procedures Management concluded that disclosure controls and procedures were effective as of quarter-end, with no material changes to internal control over financial reporting during the period - Based on an evaluation as of the end of the quarter, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective230 - There have been no changes in internal control over financial reporting during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, internal controls231 PART II. OTHER INFORMATION Legal Proceedings The company is not currently a party to any legal proceedings that would have a material adverse effect on its business, financial condition, or results of operations - The company is not currently a party to any material legal proceedings233 Risk Factors This section outlines key risks including significant financial losses, the high cost and uncertainty of clinical trials, reliance on third-party manufacturers like WuXi Biologics, intense competition, intellectual property challenges, and evolving regulatory landscapes - Financial Risk: The company has a history of significant losses, with a $1.18 billion accumulated deficit, and will require substantial additional capital to fund operations beyond its current cash runway, which is projected into the second half of 2027235236 - Third-Party and Geopolitical Risk: The company relies heavily on third-party manufacturers, including the Chinese CDMO WuXi Biologics, and proposed U.S. legislation like the BIOSECURE Act could disrupt this relationship, potentially forcing a costly and delayed transition to alternative suppliers335344 - Clinical and Regulatory Risk: The company's success is dependent on costly and inherently risky clinical trials, and failure to demonstrate safety and efficacy or to obtain regulatory approval would materially harm the business, as the regulatory process is lengthy, unpredictable, and subject to changes in policy258269 - Commercialization Risk: The company faces substantial competition from large, well-funded companies like Amgen in the TED market and must build its own commercial capabilities to launch products successfully, if approved305311 - Intellectual Property Risk: The business depends on protecting licensed and owned intellectual property, facing risks of infringement claims from third parties and challenges to the validity of its patents, which could be expensive and time-consuming to defend354373 Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities during the period - None468 Other Information The company states that no directors or officers adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement during the quarter471 Exhibits This section provides an index of exhibits filed with the quarterly report, including corporate governance documents and officer certifications