Barinthus(US:BRNS)2025-11-07 12:40Financial Performance - For the three and nine months ended September 30, 2025, the company incurred a net loss of $14.6 million and $55.4 million, respectively, with an accumulated deficit of $293.0 million as of September 30, 2025[110]. - Net loss for the nine months ended September 30, 2025 was $55.4 million, compared to a net loss of $40.6 million in 2024, an increase of $14.8 million[169]. - Cash used in operating activities was $43.7 million for the nine months ended September 30, 2025, compared to $42.0 million in 2024, an increase of $1.7 million[169]. - The company has incurred losses in each year since its inception in 2016, except for 2022 when it was profitable[175]. - The company expects to continue incurring net negative cash flows from operations for at least the next few years as it progresses clinical development[166]. - As of September 30, 2025, cash, cash equivalents, and restricted cash totaled $75.7 million[162]. - As of September 30, 2025, the company had an accumulated deficit of $293.0 million and expects to continue incurring significant losses and negative cash flows from operations for the foreseeable future[175]. Research and Development - The company is currently conducting a Phase 1 clinical trial for its lead candidate VTP-1000, aimed at restoring immune non-responsiveness to gluten in celiac disease patients, with data expected before the end of 2025[115]. - The ongoing development of VTP-300, a Phase 2 immunotherapeutic treatment for chronic hepatitis B, is being pursued with the intention of finding a partner for continued development[108]. - The company has incurred significant research and development expenses, which are expected to increase as it progresses its programs through the next stages of development[124]. - Research and development expenses decreased to $5.39 million in Q3 2025 from $11.14 million in Q3 2024, a reduction of $5.75 million[143]. - Research and development expenses totaled $21.6 million for the nine months ended September 30, 2025, down from $33.9 million in 2024, a decrease of $12.3 million[153]. Mergers and Acquisitions - The company has entered into a merger agreement with Topco and Clywedog, which is expected to close in the first half of 2026, resulting in the company becoming a wholly owned subsidiary of Topco[116]. - The combined company will focus on advancing a novel portfolio of clinical-stage candidates targeting metabolic and autoimmune diseases, with four clinical data milestones anticipated within 18 months post-merger[120]. - The company entered into a definitive merger agreement with Clywedog, which triggered an impairment assessment due to the indicative offer price being below the fair value of net assets[139]. - On September 29, 2025, the company entered into a merger agreement with Clywedog, agreeing to conduct business in the ordinary course until the merger closes[167]. Operating Expenses - Total operating expenses for the quarter were $15.22 million, down from $24.56 million in 2024, reflecting a decrease of $9.34 million[141]. - Total operating expenses decreased to $59.5 million for the nine months ended September 30, 2025, down from $60.5 million in 2024, a reduction of $1.1 million[151]. - General and administrative expenses decreased to $5.17 million in Q3 2025 from $13.42 million in Q3 2024, a decrease of $8.25 million[146]. - General and administrative expenses increased to $33.2 million for the nine months ended September 30, 2025, up from $26.6 million in 2024, an increase of $6.6 million[156]. - The company recorded an impairment charge of $4.67 million for long-lived assets in Q3 2025, compared to no impairment in Q3 2024[147]. - Impairment of long-lived assets was $4.7 million for the nine months ended September 30, 2025, compared to nil in 2024[158]. Financing and Capital Requirements - The company expects to finance future cash needs through public or private equity offerings, debt financings, collaborations, or licensing arrangements, as it does not anticipate positive cash flows from operations in the foreseeable future[112]. - The company anticipates that its existing cash and financial resources will fund its operating expenses into the start of 2027, based on current standalone research and development plans[112]. - Future capital requirements will depend on various factors, including the success of product candidates and the ability to generate revenue[180]. - The company may require substantial additional financing in the future to meet unanticipated factors and operational needs[182]. Tax and Regulatory Considerations - The company expects to benefit from the UK R&D tax credit regime, with a credit rate of 20% under the merged scheme for qualifying expenditures[131]. - The PAYE cap for claims under the merged scheme and ERIS is set at £20,000 plus 300% of the company's relevant PAYE and National Insurance contributions liabilities[130]. - The company anticipates that unsurrendered UK losses may be carried forward indefinitely to offset future taxable profits, subject to certain limitations[134]. Currency and Foreign Exchange Risks - A hypothetical 10% weakening of the U.S. dollar relative to the pound sterling would have materially affected current and projected expenses denominated in pound sterling[192]. - The company is subject to foreign currency exchange rate fluctuations, particularly with respect to the euro, pound sterling, Swiss franc, and Australian dollar[190]. - The company has significant operating costs in the United Kingdom, exposing it to changes in the exchange ratio of the U.S. dollar and the pound sterling[192]. - The company may need to relinquish valuable rights to technologies or future revenue streams if it raises additional funds through collaborations[183].