Corbus Pharmaceuticals(CRBP) - 2022 Q1 - Quarterly Report

Part I - Financial Information Condensed Consolidated Financial Statements This section presents the unaudited condensed consolidated financial statements for Q1 2022, reporting a net loss of $9.4 million Condensed Consolidated Balance Sheets Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Items | March 31, 2022 (Unaudited) | December 31, 2021 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $57,026 | $25,007 | | Investments | $29,095 | $72,641 | | Total current assets | $88,476 | $100,205 | | Total assets | $95,675 | $107,730 | | Liabilities & Equity | | | | Total current liabilities | $15,118 | $17,008 | | Total liabilities | $34,520 | $38,622 | | Total stockholders' equity | $61,155 | $69,108 | Condensed Consolidated Statements of Operations and Comprehensive Loss Statement of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Revenue from awards | $0 | $648 | | Research and development | $3,286 | $10,721 | | General and administrative | $5,231 | $5,341 | | Operating loss | ($8,517) | ($15,414) | | Net loss | ($9,437) | ($16,065) | | Net loss per share, basic and diluted | ($0.08) | ($0.14) | | Total comprehensive loss | ($9,544) | ($16,094) | Condensed Consolidated Statement of Stockholders' Equity - Total stockholders' equity decreased from $69.1 million at December 31, 2021, to $61.2 million at March 31, 2022, primarily driven by a net loss of $9.4 million for the quarter[20] Condensed Consolidated Statements of Cash Flows Cash Flow Highlights (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($10,615) | ($21,810) | | Net cash provided by (used in) investing activities | $42,962 | ($57,424) | | Net cash (used in) provided by financing activities | ($327) | $60,414 | | Net increase (decrease) in cash | $32,020 | ($18,820) | Notes to Unaudited Condensed Consolidated Financial Statements - The company focuses on developing immune modulators for immuno-oncology and fibrosis, including anti-integrin monoclonal antibodies and endocannabinoid system modulators[26] - As of March 31, 2022, the company had an accumulated deficit of $359.2 million, with management expecting approximately $86.1 million in cash, cash equivalents, and investments to fund operations for at least twelve months from the filing date[29] - The company has license agreements with Jenrin, Milky Way BioPharma, and UCSF, involving potential future milestone payments totaling up to $18.4 million, $53.0 million, and $153.0 million, respectively, plus royalties on net sales[73][75][76] - The company has a $50 million secured loan agreement with K2 HealthVentures, with a $20 million tranche drawn and a total principal outstanding of $21.2 million at March 31, 2022, including a final payment[88][91] - The company recognized $0 revenue from its development award with the Cystic Fibrosis Foundation (CFF) in Q1 2022, compared to $647,824 in Q1 2021, as the performance obligation was completed in 2021[103][107] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2022 financial results, strategic focus on immune modulators, and liquidity, noting a net loss and sufficient cash until Q1 2024 Overview - The company's pipeline focuses on anti-integrin monoclonal antibodies (CRB-601 and CRB-602) for cancer and fibrosis, and second-generation CB1 inverse agonists for obesity[133][134] - Development of lenabasum is being discontinued following a failed Phase 3 study in dermatomyositis, with the company seeking licensing partners for future development[135] Results of Operations - Revenue from the CFF award was $0 for the three months ended March 31, 2022, compared to $648,000 in the prior-year period, as the program is complete[144][145] Operating Expense Comparison (in thousands) | Expense Category | Three Months Ended March 31, 2022 | Three Months Ended March 31, 2021 | Change | | :--- | :--- | :--- | :--- | | Research and Development | $3,286 | $10,721 | ($7,435) | | General and Administrative | $5,231 | $5,341 | ($110) | - The decrease in R&D expense was primarily due to a $4.4 million reduction in clinical expenses associated with the end of lenabasum studies[146] Liquidity and Capital Resources - As of March 31, 2022, the company had approximately $86.1 million in cash, cash equivalents, and marketable securities, expected to fund operations into the first quarter of 2024[156] - Net cash used in operating activities was $10.6 million for the quarter, a significant decrease from $21.8 million in the prior-year period[153] - The company is subject to SEC 'baby shelf rules' due to its public float being below $75 million, restricting shelf registration offerings to approximately $22.7 million in any twelve-month period[155] Critical Accounting Policies and Estimates - Management identifies stock-based compensation, accrued research and development expenses, and right-of-use assets/lease liabilities as critical accounting policies involving significant judgment and complexity[166] - Accrued R&D expenses require significant estimation regarding services performed by CROs and other vendors, especially when invoices have not yet been received[170][171] Quantitative and Qualitative Disclosures About Market Risk The company states that this section is not applicable - Not Applicable[178] Controls and Procedures Management, with the participation of the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2022, with no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[180] - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control[181] Part II - Other Information Legal Proceedings The company reports that Venn Therapeutics, LLC filed an amended complaint against the company, its CEO, and a former employee on April 6, 2022, with Corbus filing a motion to dismiss on May 6, 2022, believing the claims are without merit and intending to defend vigorously - On April 6, 2022, Venn Therapeutics, LLC filed an amended complaint against the Company, which filed a motion to dismiss the complaint in its entirety on May 6, 2022[183] - The Company believes the complaint is without merit and intends to vigorously defend against the claims[184] Risk Factors There have been no material changes in or additions to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2021 - There have been no material changes to the risk factors from those included in the Annual Report on Form 10-K for the year ended December 31, 2021[185] Unregistered Sales of Equity Securities and Use of Proceeds None were reported for the period - None[187] Defaults Upon Senior Securities None were reported for the period - None[189] Mine Safety Disclosures This item is not applicable to the company - Not applicable[191] Other Information None was reported for the period - None[193] Exhibits This section lists the exhibits filed or furnished with the Quarterly Report on Form 10-Q, including CEO and CFO certifications and Inline XBRL documents - The report includes certifications from the Chief Executive Officer and Chief Financial Officer as required by Rule 13a-14(a) and Rule 13a-14(b)[195] - Inline XBRL instance and taxonomy documents are also filed as exhibits[195]