Unity Biotechnology(US:UBX)2023-08-07 16:00Financial Performance - The company reported net losses of $12.2 million and $13.1 million for the three months ended June 30, 2023 and 2022, respectively, and $23.1 million and $32.1 million for the six months ended June 30, 2023 and 2022, respectively [115]. - The net loss for the three months ended June 30, 2023, was $12.2 million, an improvement of $0.93 million compared to a net loss of $13.1 million for the same period in 2022 [130]. - The company incurred a net loss of $23.1 million for the six months ended June 30, 2023, compared to a net loss of $32.1 million for the same period in 2022, reflecting an improvement of $8.98 million [138]. - The company expects to continue incurring net operating losses for at least the next several years as it advances its drug candidates through clinical development [117]. - The company anticipates significant future funding requirements as it has not generated any product revenue and expects to incur increasing losses [149]. Accumulated Deficit and Cash Flow - As of June 30, 2023, the company had an accumulated deficit of $483.0 million and does not expect positive cash flows from operations in the foreseeable future [115]. - The company reported an accumulated deficit of $483.0 million as of June 30, 2023, with no products approved for sale and no revenue generated from product sales [138]. - The company expects its existing capital resources to fund planned operating expenses into the fourth quarter of 2024, primarily to advance the UBX1325 program [139]. - The company anticipates needing to raise additional capital to finance operations, as it has historically relied on equity and debt financing [142]. Research and Development - The company plans to initiate a head-to-head Phase 2b study (ASPIRE study) in the second half of 2023, comparing UBX1325 to aflibercept in patients with diabetic macular edema (DME) [107]. - In the BEHOLD study, a single injection of UBX1325 led to a statistically significant improvement in best-corrected visual acuity (BCVA) of +6.2 ETDRS letters from baseline at 24 weeks [105]. - Approximately 50% of UBX1325-treated patients did not require any additional injections through 48 weeks, compared to only 22% in the sham arm [107]. - The Phase 2b ASPIRE study is expected to enroll about 40 subjects, with 16-week data readout anticipated in the fourth quarter of 2024 [111]. Operating Expenses - Research and development expenses decreased by $1.1 million to $6.5 million for the three months ended June 30, 2023, compared to $7.6 million for the same period in 2022 [131]. - Total operating expenses for the three months ended June 30, 2023, were $11.96 million, a decrease of $0.53 million from $12.49 million in the same period of 2022 [130]. - General and administrative expenses increased by $0.5 million to $5.4 million for the three months ended June 30, 2023, compared to $4.9 million for the same period in 2022 [134]. Financing and Capital Resources - The company entered into a Loan Agreement with Hercules Capital, Inc., receiving $25.0 million, with an amortization date extended to April 1, 2023 [143]. - The outstanding principal amount of the term loan under the Hercules Loan Agreement was $16.8 million as of June 30, 2023 [169]. - The company closed an underwritten offering in August 2022, issuing 6,428,571 shares with net proceeds of approximately $41.7 million [146]. - The company has no committed external source of funds and plans to finance future cash needs through various means, including equity sales and debt [150]. - The company has entered into various license agreements obligating it to make milestone payments and tiered royalties based on sales of licensed products [160]. Cash Flow Activities - The company reported cash used in operating activities of $22.4 million for the six months ended June 30, 2023, compared to $29.8 million for the same period in 2022 [152][154]. - Cash provided by investing activities was $31.1 million for the six months ended June 30, 2023, primarily from maturities of marketable securities [155]. - Cash used in financing activities was $2.4 million for the six months ended June 30, 2023, mainly due to a $3.2 million principal repayment of long-term debt [157]. Restructuring and Operational Changes - The company has implemented restructuring actions, reducing headcount by approximately 29% to focus resources on ongoing clinical programs [114]. - The COVID-19 pandemic has impacted clinical trial operations, but the company has not experienced disruptions in the supply chain for drug manufacturers necessary for its studies [119]. Interest Rate and Investment Activities - The effective interest rate on the term loan was 20.03% as of June 30, 2023 [169]. - A hypothetical 1% change in interest rates would increase interest expense by approximately $0.1 million annually [169]. - The company aims to preserve capital while maximizing income from investments without assuming significant risk [168]. - The company believes its exposure to interest rate risk is not significant due to the short-term nature of its investments [168]. - Interest payments under the term loan may increase if market interest rates rise, impacting overall financial performance [169]. - The interest on the term loan accrues at a per annum rate of the greater of the Wall Street Journal prime rate plus 6.10% or 9.35% [169]. - The company’s investment activities primarily consist of bank deposits, money market funds, and marketable securities [168]. - A 1% movement in market interest rates would not have a significant impact on the total value of the company's investment portfolio [168].