Geron(US:GERN)2022-11-06 16:00Financial Performance - Net loss for the three months ended September 30, 2022, was $41,051,000, compared to a net loss of $26,697,000 for the same period in 2021, reflecting a 53.8% increase in losses [14]. - For the nine months ended September 30, 2022, Geron Corporation reported a net loss of $99,266,000, compared to a net loss of $84,095,000 for the same period in 2021, reflecting an increase of approximately 18% in losses year-over-year [22]. - The company reported a basic and diluted net loss per share of $0.10 for the three months ended September 30, 2022, compared to $0.08 for the same period in 2021 [14]. - The company incurred approximately $75,000 in legal fees related to the loan agreement's second amendment, which will be amortized over the loan's life [78]. - The company has incurred significant losses and negative cash flows since inception and expects to continue incurring significant expenses for the foreseeable future [171]. Assets and Liabilities - Total current assets increased to $222,070,000 as of September 30, 2022, up from $187,206,000 as of December 31, 2021, representing a growth of 18.6% [11]. - The company’s total current liabilities rose to $82,809,000 as of September 30, 2022, compared to $45,521,000 as of December 31, 2021, an increase of 81.9% [11]. - Total stockholders' equity decreased to $108,172,000 as of September 30, 2022, down from $126,416,000 as of December 31, 2021, a decline of 14.4% [11]. - The company had $195,151,000 in cash, restricted cash, cash equivalents, and marketable securities as of September 30, 2022 [26]. - The company has accrued liabilities totaling $53,111,000 as of September 30, 2022, which includes $24,000,000 related to a securities class action settlement [75]. Cash Flow and Financing - Cash and cash equivalents increased to $61,103,000 as of September 30, 2022, compared to $34,871,000 as of December 31, 2021, marking a 75.5% increase [11]. - The company generated negative cash flows from operations of $92,198,000 for the nine months ended September 30, 2022, compared to $73,388,000 for the same period in 2021, indicating a worsening cash flow situation [22]. - The company completed a public offering on April 1, 2022, raising net cash proceeds of $69,916,000 from the issuance of 53,333,334 shares of common stock and associated warrants [27]. - Net cash provided by financing activities increased to $75.3 million for the nine months ended September 30, 2022, from $28.9 million in 2021, mainly due to proceeds from a public offering and warrant exercises [153]. - Future funding requirements indicate that existing capital resources may be sufficient to fund operations until mid-2024, contingent on achieving certain clinical and regulatory milestones [142]. Research and Development - Research and development expenses for the nine months ended September 30, 2022, were $67,308,000, an increase of 9.3% from $61,577,000 in the same period of 2021 [14]. - Total research and development expenses for the three months ended September 30, 2022, were $24.6 million, up from $18.5 million in 2021, representing a 33% increase [129]. - The company is focused on the development of imetelstat, a first-in-class telomerase inhibitor, targeting hematologic malignancies [101]. - The company plans to support a Phase 2 trial named IMpress for imetelstat in acute myeloid leukemia, expected to start in Q4 2022 [104]. - Ongoing clinical trials for imetelstat, including IMerge and IMpactMF, are experiencing delays due to the COVID-19 pandemic and geopolitical issues in Ukraine and Russia [86]. Market and Operational Risks - The company faces risks related to the development of imetelstat, including potential delays in clinical trials and regulatory approvals, which could adversely affect its financial condition [163]. - The ongoing geopolitical unrest and the COVID-19 pandemic may continue to affect patient enrollment and retention, further complicating clinical development efforts [182]. - The company is subject to ongoing legal challenges, including securities class action lawsuits, which could divert management's attention and resources [171]. - The company faces increased market volatility due to global economic conditions, including inflation and rising interest rates, which could affect liquidity and capital raising efforts [90]. - The company has not established any reserve for potential liabilities related to pending lawsuits, which could materially affect financial statements [85]. Regulatory and Compliance - The company recognizes revenue in accordance with Accounting Standards Codification Topic 606, which involves a five-step process for revenue recognition [40]. - The company plans to adopt ASU 2016-13 regarding credit losses effective January 1, 2023, expecting no material impact on financial statements [62]. - The company is required to maintain a minimum cash balance of at least $30,000,000 or 50% of the outstanding principal amount under the loan agreement until regulatory approval for imetelstat [80]. - Regulatory authorities may require additional information to support the benefit-risk profile of imetelstat, which could lead to suspension or termination of current clinical trials if deemed unacceptable [191]. - Compliance with GCP and GMP regulations is critical; failures could result in unreliable data and delays in regulatory approval [206].