Bolt Biotherapeutics(BOLT) - 2021 Q1 - Quarterly Report

PART I FINANCIAL INFORMATION This section provides the unaudited financial statements and management's discussion and analysis for the first quarter Item 1. Financial Statements (unaudited) This section presents the unaudited condensed financial statements for Q1 2021, including balance sheets, operations, equity, and cash flows, with explanatory notes Condensed Balance Sheets This section provides a snapshot of the company's financial position at March 31, 2021, and December 31, 2020 | Metric | March 31, 2021 (in thousands) | December 31, 2020 (in thousands) | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $95,481 | $5,542 | | Short-term investments | $171,188 | $17,296 | | Total current assets | $271,210 | $25,361 | | Total assets | $324,637 | $46,542 | | Liabilities & Equity | | | | Total liabilities | $21,389 | $46,193 | | Total stockholders' equity (deficit) | $303,248 | $(104,947) | - The company's financial position strengthened significantly following its IPO in February 2021, with total assets increasing from $46.5 million to $324.6 million, and stockholders' deficit of $104.9 million converting to stockholders' equity of $303.2 million between December 31, 2020, and March 31, 2021[14] Condensed Statements of Operations and Comprehensive Loss This section details the company's financial performance, including revenue, expenses, and net loss for Q1 2021 and Q1 2020 | Metric | Three Months Ended March 31, 2021 (in thousands) | Three Months Ended March 31, 2020 (in thousands) | | :--- | :--- | :--- | | Collaboration revenue | $0 | $164 | | Research and development | $14,127 | $6,787 | | General and administrative | $4,299 | $2,122 | | Loss from operations | $(18,426) | $(8,745) | | Net loss | $(24,454) | $(8,633) | | Net loss per share, basic and diluted | $(1.14) | $(4.16) | - Net loss for the first quarter of 2021 increased to $24.5 million from $8.6 million in the prior year period, driven by a doubling of Research and Development and General and Administrative expenses, and a $6.1 million non-cash charge[15] Condensed Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) This section outlines changes in the company's equity structure, including preferred stock issuance and conversion, and the impact of the IPO - In Q1 2021, the company issued Series C-2 convertible preferred stock for $51.9 million and subsequently converted all outstanding convertible preferred stock into 20,843,334 shares of common stock upon its IPO[18] - The company raised net proceeds of $242.0 million from its IPO, which significantly increased additional paid-in capital from $3.5 million at year-end 2020 to $436.2 million at March 31, 2021[18][27] Condensed Statements of Cash Flows This section details the company's cash inflows and outflows from operating, investing, and financing activities for Q1 2021 and Q1 2020 | Cash Flow Activity | Three Months Ended March 31, 2021 (in thousands) | Three Months Ended March 31, 2020 (in thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(16,559) | $(9,638) | | Net cash used in investing activities | $(190,521) | $(13,608) | | Net cash provided by financing activities | $297,019 | $34 | - Financing activities provided $297.0 million in cash, primarily from $245.0 million in net proceeds from the IPO and $51.9 million from the issuance of preferred stock[23][118] - Investing activities used $190.5 million, mainly for the purchase of marketable securities following the capital raise[23][117] Notes to the Condensed Financial Statements This section provides detailed explanations of the accounting policies and significant transactions impacting the condensed financial statements - On February 9, 2021, the company completed its IPO, selling 13,225,000 shares of common stock at $20.00 per share for net proceeds of approximately $242.0 million[27] - As of March 31, 2021, the company had cash, cash equivalents, and marketable securities of $302.9 million and an accumulated deficit of $132.9 million, with management believing existing cash is sufficient to fund operations for at least the next 12 months[29][114] - In January 2021, the company issued 5,611,059 shares of Series C-2 convertible preferred stock for net proceeds of $51.9 million, settling a contractual obligation and reclassifying the related purchase right liability to equity[74] - Stock-based compensation expense increased to $2.1 million for Q1 2021, up from $0.2 million in Q1 2020[80] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's financial condition and operational results for Q1 2021, highlighting increased expenses from R&D and the impact of the February 2021 IPO on liquidity Overview This section provides a high-level summary of the company's business, its lead product candidate, and funding sources - The company is a clinical-stage biotechnology firm pioneering Boltbody™ ISAC (immune stimulating antibody conjugate) technology, with its lead product candidate, BDC-1001, in a Phase 1/2 trial for HER2-expressing solid tumors[86] - Operations have been funded through private placements and the February 2021 IPO, which raised approximately $242.0 million in net proceeds[87] - The company anticipates continued significant expenses and operating losses as it advances its clinical trials and R&D programs[88] Results of Operations This section analyzes the key drivers behind the company's financial performance, including changes in revenue and expenses | Metric | Three Months Ended March 31, 2021 (in thousands) | Three Months Ended March 31, 2020 (in thousands) | Change (in thousands) | | :--- | :--- | :--- | :--- | | Collaboration revenue | $0 | $164 | $(164) | | Research and development | $14,127 | $6,787 | $7,340 | | General and administrative | $4,299 | $2,122 | $2,177 | | Loss from operations | $(18,426) | $(8,745) | $(9,681) | | Net loss | $(24,454) | $(8,633) | $(15,821) | - Research and development expenses increased by $7.3 million year-over-year, primarily due to a $3.8 million increase in manufacturing expenses for BDC-1001 and BDC-2034 and a $2.5 million increase in personnel-related costs from higher headcount[109] - General and administrative expenses rose by $2.2 million, driven by a $1.5 million increase in personnel costs and a $0.9 million increase in professional services fees for accounting and legal services[110] - A $6.0 million expense was recognized from the change in fair value of the convertible preferred stock purchase right liability, which was settled in January 2021[112] Liquidity and Capital Resources This section assesses the company's ability to meet its financial obligations and fund future operations, focusing on cash position and capital raises - As of March 31, 2021, the company had $302.9 million in cash, cash equivalents, and marketable securities, with an accumulated deficit of $132.9 million[114] - Net cash provided by financing activities in Q1 2021 was $297.0 million, primarily from the IPO ($245.0 million net) and the issuance of Series C-2 preferred stock ($51.9 million net)[118] - Management believes that existing cash, cash equivalents, and marketable securities will be sufficient to fund operations for at least the next 12 months[120] Item 3. Quantitative and Qualitative Disclosures About Market Risk The company is a smaller reporting company and is not required to provide the information requested under this item - As a smaller reporting company, Bolt Biotherapeutics is exempt from providing quantitative and qualitative disclosures about market risk[128] Item 4. Controls and Procedures Management identified a material weakness in internal control over financial reporting due to insufficient accounting personnel and policies, initiating remediation efforts - Management identified a material weakness in its internal control over financial reporting[130] - The weakness stems from not having a sufficient number of professionals with the appropriate level of accounting knowledge and experience, leading to a lack of formal accounting policies, procedures, and controls[131] - Remediation efforts have commenced, including increasing accounting personnel and engaging third-party experts to help design and implement effective controls[133] PART II OTHER INFORMATION This section provides additional information not covered in the financial statements, including legal proceedings, risk factors, and equity sales Item 1. Legal Proceedings The company reports that there are currently no pending legal claims or actions that are expected to have a material adverse effect on its financial condition or results of operations - As of the filing date, the company is not involved in any legal proceedings that would materially impact its business[138] Item 1A. Risk Factors The company states that there have been no material changes to the risk factors previously disclosed in its Annual Report on Form 10-K for the year ended December 31, 2020 - No material changes have occurred to the risk factors disclosed in the company's 2020 Form 10-K[139] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds This section details unregistered equity sales, including Series C-2 preferred stock, and confirms the use of IPO proceeds as described in the prospectus - In January 2021, the company issued 5,611,059 shares of Series C-2 convertible preferred stock for aggregate proceeds of $51.9 million in an unregistered sale[140] - The company completed its IPO on February 9, 2021, raising net proceeds of approximately $242.0 million[144] - There has been no material change in the planned use of the net proceeds from the IPO as described in the prospectus[145] Item 3. Defaults Upon Senior Securities The company reports no defaults upon senior securities - None[146] Item 4. Mine Safety Disclosures This item is not applicable to the company - Not applicable[147] Item 5. Other Information The company reports no other information for this item - None[148] Item 6. Exhibits This section lists exhibits filed with the Quarterly Report on Form 10-Q, including corporate governance documents and officer certifications - The report includes exhibits such as the Amended and Restated Certificate of Incorporation, Amended and Restated Bylaws, and Sarbanes-Oxley Act certifications[151][153]