Deciphera(DCPH) - 2023 Q3 - Quarterly Report

UNITED STATES SECURITIES AND EXCHANGE COMMISSION FORM 10-Q Quarterly Report on Form 10-Q for Deciphera Pharmaceuticals, Inc. for Q3 2023, confirming filer status and trading symbol - Filing Type: Quarterly Report on Form 10-Q for the period ended September 30, 2023[2] - Registrant: Deciphera Pharmaceuticals, Inc.[3] - Trading Symbol: DCPH on The Nasdaq Global Select Market[3] - Filer Status: Large accelerated filer[4] - Outstanding Shares (as of Oct 26, 2023): 80,123,138 shares of Common Stock outstanding as of October 26, 2023[4] SUMMARY OF MATERIAL RISKS ASSOCIATED WITH OUR BUSINESS Overview of significant risks: QINLOCK commercialization, clinical trial failures, regulatory delays, competition, and financial viability - Commercialization Risk: No assurance of successful commercialization of QINLOCK, particularly in key European markets, or achieving expected revenue levels[9] - Clinical Trial Risk: The pivotal Phase 3 INSIGHT study for QINLOCK in second-line GIST may not be successful[9] - Regulatory & Supply Risk: Delays in regulatory approvals or drug supply issues could materially impair revenue generation[9] - Competition: Substantial competition may lead to others developing or commercializing products more successfully[9] - Financial Viability: Significant operating losses since inception, expected continued losses, and potential inability to achieve or maintain profitability[12] FORWARD-LOOKING STATEMENTS Outlines forward-looking statements, emphasizing actual results may differ due to various risks and uncertainties - Disclaimer: All statements other than historical facts are forward-looking and subject to various risks and uncertainties[14] - Key Forward-Looking Areas: Key forward-looking areas include successful commercialization of QINLOCK, success and cost of R&D plans for drug candidates (including INSIGHT study and DCC-3116), regulatory approvals, ability to obtain funding, and intellectual property protection[15][19] PART I – FINANCIAL INFORMATION Presents unaudited consolidated financial statements, management's discussion, market risk, and controls for Q3 2023 Item 1. Financial Statements (unaudited) Provides unaudited consolidated financial statements: balance sheets, statements of operations, equity, cash flows, and notes Consolidated Balance Sheets Shows changes in assets, liabilities, and stockholders' equity, with increases in total assets and equity Total Assets: | Metric | Sep 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | Change (in thousands) | | :----------------------- | :-------------------------- | :-------------------------- | :-------------------- | | Total Assets | $497,836 | $454,039 | +$43,797 | Total Liabilities: | Metric | Sep 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | Change (in thousands) | | :----------------------- | :-------------------------- | :-------------------------- | :-------------------- | | Total Liabilities | $116,166 | $112,348 | +$3,818 | Total Stockholders' Equity: | Metric | Sep 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | Change (in thousands) | | :----------------------- | :-------------------------- | :-------------------------- | :-------------------- | | Total Stockholders' Equity | $381,670 | $341,691 | +$39,979 | - Cash and Cash Equivalents: Cash and cash equivalents increased from $64.7 million at December 31, 2022, to $108.1 million at September 30, 2023[21] - Short-term Marketable Securities: Short-term marketable securities decreased from $259.7 million to $231.0 million[21] - Long-term Marketable Securities: Long-term marketable securities increased from $14.6 million to $37.9 million[21] Consolidated Statements of Operations and Comprehensive Loss Details revenues, cost of sales, operating expenses, and net loss for Q3 and 9M 2023 and 2022 Total Revenues: | Metric | 3 Months Ended Sep 30, 2023 (in thousands) | 3 Months Ended Sep 30, 2022 (in thousands) | 9 Months Ended Sep 30, 2023 (in thousands) | 9 Months Ended Sep 30, 2022 (in thousands) | | :---------------- | :----------------------------------- | :----------------------------------- | :----------------------------------- | :----------------------------------- | | Product revenues, net | $41,820 | $32,318 | $112,362 | $92,624 | | Collaboration revenues | $1,493 | $3,656 | $2,700 | $5,067 | | Total revenues | $43,313 | $35,974 | $115,062 | $97,691 | Total Cost and Operating Expenses: | Metric | 3 Months Ended Sep 30, 2023 (in thousands) | 3 Months Ended Sep 30, 2022 (in thousands) | 9 Months Ended Sep 30, 2023 (in thousands) | 9 Months Ended Sep 30, 2022 (in thousands) | | :-------------------------------- | :----------------------------------- | :----------------------------------- | :----------------------------------- | :----------------------------------- | | Cost of sales | $1,286 | $3,344 | $1,947 | $5,525 | | Research and development | $62,463 | $47,485 | $175,524 | $139,755 | | Selling, general, and administrative | $33,252 | $30,026 | $97,311 | $87,972 | | Total cost and operating expenses | $97,001 | $80,855 | $274,782 | $233,252 | Net Loss: | Metric | 3 Months Ended Sep 30, 2023 (in thousands) | 3 Months Ended Sep 30, 2022 (in thousands) | 9 Months Ended Sep 30, 2023 (in thousands) | 9 Months Ended Sep 30, 2022 (in thousands) | | :---------------- | :----------------------------------- | :----------------------------------- | :----------------------------------- | :----------------------------------- | | Net loss | $(49,581) | $(43,043) | $(147,752) | $(132,996) | Net Loss per Share (Basic and Diluted): | Metric | 3 Months Ended Sep 30, 2023 | 3 Months Ended Sep 30, 2022 | 9 Months Ended Sep 30, 2023 | 9 Months Ended Sep 30, 2022 | | :--------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net loss per share—basic and diluted | $(0.58) | $(0.55) | $(1.75) | $(1.82) | Consolidated Statements of Stockholders' Equity Details changes in stockholders' equity, including increased paid-in capital, common stock, and accumulated deficit - Additional Paid-in Capital: Additional paid-in capital increased from $1.58 billion at December 31, 2022, to $1.76 billion at September 30, 2023, primarily due to common stock offerings[26] - Accumulated Deficit: Accumulated deficit increased from $(1.23) billion at December 31, 2022, to $(1.38) billion at September 30, 2023, reflecting ongoing net losses[26] - Common Stock Shares Outstanding: Common stock shares outstanding increased from 67.6 million shares at December 31, 2022, to 80.0 million shares at September 30, 2023[26] Consolidated Statements of Cash Flows Summarizes cash flows from operating, investing, and financing activities, showing a net increase in cash for 9M 2023 Net Cash Flows Used in Operating Activities: | Metric | 9 Months Ended Sep