Black Diamond Therapeutics(BDTX) - 2023 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements (Unaudited) This section presents the company's unaudited condensed consolidated financial statements for the six months ended June 30, 2023, including balance sheets, statements of operations, and cash flows, with accompanying notes Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $41,888 | $34,315 | | Investments | $47,639 | $88,492 | | Total current assets | $92,992 | $127,706 | | Total assets | $119,879 | $156,255 | | Liabilities & Equity | | | | Total liabilities | $37,680 | $40,560 | | Total stockholders' equity | $82,199 | $115,695 | Condensed Consolidated Statements of Operations Highlights (Six Months Ended June 30, in thousands) | Account | 2023 | 2022 | | :--- | :--- | :--- | | Research and development | $27,907 | $33,981 | | General and administrative | $13,686 | $14,871 | | Total operating expenses | $41,593 | $48,852 | | Loss from operations | $(41,593) | $(48,852) | | Net loss | $(40,027) | $(48,437) | | Net loss per share | $(1.09) | $(1.33) | Condensed Consolidated Statements of Cash Flows Highlights (Six Months Ended June 30, in thousands) | Account | 2023 | 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(34,399) | $(46,667) | | Net cash provided by investing activities | $41,981 | $36,537 | | Net cash provided by financing activities | $51 | $153 | | Net increase (decrease) in cash | $7,633 | $(9,977) | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) This section reviews the company's clinical-stage oncology programs and financial results for the six months ended June 30, 2023, highlighting reduced operating losses and liquidity Overview The company is a clinical-stage precision oncology firm developing 'MasterKey' therapies, with lead candidates BDTX-1535 and BDTX-4933 advancing in clinical trials - Lead product candidate BDTX-1535 demonstrated a favorable tolerability profile and clinical proof of activity in a Phase 1 study for non-small cell lung cancer (NSCLC) patients[243] - Second product candidate, BDTX-4933, initiated a Phase 1 clinical trial in Q2 2023 for patients with all-class BRAF or RAS mutations[233] - The company has incurred significant operating losses since inception, with a net loss of $40.0 million for the six months ended June 30, 2023, and an accumulated deficit of $375.0 million[236] Results of operations Total operating expenses decreased for the three and six-month periods ending June 30, 2023, primarily due to reduced R&D and personnel costs, partially offset by increased clinical trial spending Comparison of Results of Operations (in thousands) | Period | Metric | Q2 2023 | Q2 2022 | Change | H1 2023 | H1 2022 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Three Months | R&D Expenses | $13,154 | $16,195 | $(3,041) | - | - | - | | | G&A Expenses | $6,878 | $6,978 | $(100) | - | - | - | | | Net Loss | $(19,152) | $(22,930) | $3,778 | - | - | - | | Six Months | R&D Expenses | - | - | - | $27,907 | $33,981 | $(6,074) | | | G&A Expenses | - | - | - | $13,686 | $14,871 | $(1,185) | | | Net Loss | - | - | - | $(40,027) | $(48,437) | $8,410 | - The $6.1 million decrease in R&D expenses for the first six months of 2023 was primarily due to a $5.0 million reduction in BDTX-189 expenses and a $3.1 million decrease in personnel costs, partially offset by a $7.9 million net increase in spending for the BDTX-1535 and BDTX-4933 clinical trials[25] - General and administrative expenses for the six months ended June 30, 2023, decreased by $1.2 million to $13.7 million, mainly due to lower personnel-related costs, legal, and other professional fees[38] Liquidity and capital resources The company's operations are funded primarily through equity sales, with current capital expected to support operations into the first half of 2025 following a recent equity offering - As of June 30, 2023, the company had cash, cash equivalents, and investments of $89.5 million[4][34] - In July 2023, the company completed a Follow-on Offering, raising approximately $71.6 million in net proceeds[43][175][239] - Management believes that existing cash, combined with the proceeds from the July 2023 Follow-on Offering, will be sufficient to fund operating expenses and capital expenditure requirements into the first half of 2025[4][250] Contractual Obligations as of June 30, 2023 (in thousands) | Obligation Type | Less than 1 Year | 1 to 3 Years | 3 to 5 Years | More than 5 Years | Total | | :--- | :--- | :--- | :--- | :--- | :--- | | Property leases | $4,301 | $8,955 | $9,449 | $9,845 | $32,550 | Item 3. Quantitative and Qualitative Disclosure About Market Risk As a smaller reporting company, the company is not required to provide quantitative and qualitative disclosures about market risk - As a smaller reporting company defined by Rule 12b-2 of the Exchange Act, the company is not required to provide the information under this item[81] Item 4. Controls and Procedures The company's disclosure controls and procedures were effective as of June 30, 2023, with no material changes to internal control over financial reporting during the quarter - Management, including the Chief Executive Officer and Chief Financial Officer, concluded that the company's disclosure controls and procedures were effective as of June 30, 2023[63] - There were no changes in the company's internal control over financial reporting during the quarter that have materially affected, or are reasonably likely to materially affect, its internal controls[64] PART II - OTHER INFORMATION Item 1. Legal Proceedings The company is not currently a party to any material legal proceedings and does not anticipate any significant adverse effects from ordinary course legal matters - The company is not currently a party to any material legal proceedings[84][228] Item 1A. Risk Factors A new risk factor addresses potential adverse effects from banking and financial market instability, though the company has not experienced any adverse impact to date - A new risk factor was added to address potential adverse effects from instability in the banking system and financial markets, referencing the failure of Silicon Valley Bank (SVB)[65][85] - As of the report date, the company does not hold material cash deposits at SVB and has not experienced any adverse impact to its liquidity or business operations[66] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities during the period, and no material change in the planned use of IPO proceeds - There were no unregistered sales of equity securities during the period[67][90] - The company confirmed there has been no material change in its planned use of the net proceeds from its February 2020 IPO[89] Item 3. Defaults Upon Senior Securities No defaults upon senior securities were reported during the period - None reported[70][91] Item 4. Mine Safety Disclosures This item is not applicable to the company's business operations - Not applicable[70][92] Item 5. Other Information No information was reported for this item - None reported[70] Item 6. Exhibits This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL documents - The report includes a list of filed exhibits, such as CEO and CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906, and Inline XBRL data files[72] SIGNATURES The quarterly report was formally signed by the company's principal executive and financial officers on August 11, 2023 - The report was duly signed on behalf of Black Diamond Therapeutics, Inc. on August 11, 2023[98][95] - Signatories include David M. Epstein (Principal Executive Officer) and Fang Ni (Principal Financial Officer)[74]