PART I. FINANCIAL INFORMATION Financial Statements (Unaudited) This section presents MeiraGTx Holdings plc's unaudited condensed consolidated financial statements for Q2 2023, including balance sheets, statements of operations, shareholders' equity, and cash flows Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $92,773 | $115,516 | | Total Current Assets | $143,144 | $154,339 | | TOTAL ASSETS | $310,263 | $318,237 | | Liabilities & Equity | | | | Total Current Liabilities | $71,803 | $82,072 | | Note payable, net | $71,571 | $71,033 | | TOTAL LIABILITIES | $186,736 | $200,499 | | Total Shareholders' Equity | $123,527 | $117,738 | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | License revenue - related party | $3,540 | $10,759 | $6,874 | $16,392 | | Research and development | $19,937 | $23,999 | $42,259 | $47,098 | | Total operating expenses | $32,325 | $34,517 | $67,419 | $68,884 | | Net loss | $(29,581) | $(33,973) | $(59,945) | $(65,018) | | Basic and diluted net loss per share | $(0.53) | $(0.76) | $(1.15) | $(1.46) | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(66,404) | $(36,105) | | Net cash used in investing activities | $(13,580) | $(26,460) | | Net cash provided by (used in) financing activities | $56,716 | $(2,582) | | Net decrease in cash and cash equivalents | $(23,268) | $(65,147) | Notes to Condensed Consolidated Financial Statements Detailed notes supplement the financial statements, covering company organization, liquidity, accounting policies, and specific financial line items - The company is a clinical-stage gene therapy company with six programs in clinical development, initially focusing on ocular diseases, neurodegenerative diseases, and severe forms of xerostomia30 - Management estimates that cash and cash equivalents of $92.8 million, along with receivables from its collaboration with Janssen, will be sufficient to cover expenses for at least the next twelve months from the issuance date of the financial statements36 - Revenue from the Janssen Collaboration Agreement is recognized using a cost-based input method, where progress towards completion is measured based on the ratio of actual costs incurred to total estimated costs71122 Share-Based Compensation Expense (in thousands) | Period | Research and Development | General and Administrative | Total | | :--- | :--- | :--- | :--- | | Three Months Ended June 30, 2023 | $3,293 | $3,978 | $7,271 | | Three Months Ended June 30, 2022 | $3,666 | $3,637 | $7,303 | | Six Months Ended June 30, 2023 | $6,319 | $7,384 | $13,703 | | Six Months Ended June 30, 2022 | $6,319 | $7,583 | $14,881 | - The company entered into a senior secured financing agreement with Perceptive Credit Holdings III, LP, providing an initial $75.0 million in notes (Tranche 1 Notes), with an annual interest rate of 14.81% at June 30, 2023141142 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses financial condition and operational results, including business overview, clinical highlights, comparative analysis, and liquidity and capital resources - As of June 30, 2023, the company had cash and cash equivalents of $92.8 million and an accumulated deficit of $530.1 million, financing operations through equity sales, debt, and Janssen collaboration payments154155 - The company estimates its current cash, cash equivalents, and expected research funding will be sufficient to fund operating expenses and capital requirements into the second quarter of 2025161217 - Recent operational highlights include surpassing enrollment targets for the Phase 3 LUMEOS trial, initiating a Phase 2 study for AAV-hAQP1, receiving commercial MIA authorization for its Shannon QC facility, and dosing patients in the AAV-GAD clinical trial168 Comparison of Results of Operations (in thousands) | Metric | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | License revenue - related party | $3,540 | $10,759 | $6,874 | $16,392 | | Research and development | $19,937 | $23,999 | $42,259 | $47,098 | | General and administrative | $12,388 | $10,518 | $25,160 | $21,786 | | Net loss | $(29,581) | $(33,973) | $(59,945) | $(65,018) | Quantitative and Qualitative Disclosures About Market Risk This section details the company's exposure to market risks, including foreign currency exchange risk from international operations and interest rate risk from variable-rate debt - The company is exposed to foreign currency risk between the U.S. Dollar, British pound sterling, and euro; a hypothetical 10% unfavorable movement would result in an additional foreign currency loss of approximately $28.6 million for the six months ended June 30, 2023229 - The company is exposed to interest rate risk from its Note Purchase Agreement, bearing interest at 10.00% plus SOFR; a hypothetical 1% increase in SOFR would increase annual interest expense by approximately $0.8 million230 Controls and Procedures Management assessed disclosure controls and procedures as effective on June 30, 2023, with no material changes to internal control over financial reporting during the quarter - Management, including the CEO and CFO, evaluated disclosure controls and procedures, concluding they were effective at a reasonable assurance level as of the end of the reporting period233 - No changes in the company's internal control over financial reporting during the quarter ended June 30, 2023, have materially affected, or are reasonably likely to materially affect, internal controls234 PART II. OTHER INFORMATION Legal Proceedings This section confirms that the company is not currently involved in any material legal proceedings - The company is not subject to any material legal proceedings236 Risk Factors This section details significant risks and uncertainties that could adversely affect the company's business, financial condition, and future prospects, categorized by key operational and financial areas - The company has a history of significant losses, with an accumulated deficit of approximately $530.1 million as of June 30, 2023, and anticipates continued losses for the foreseeable future238 - The company will require additional capital to fund operations, and its ability to raise funds may be affected by external factors; failure to secure financing could force delays or reductions in research and development programs243 - The development of novel gene therapies is difficult, costly, and time-consuming, with an uncertain regulatory landscape and a high risk of failure in clinical trials259264271 - The company faces significant competition from major pharmaceutical and biotechnology companies, and its success depends on obtaining regulatory approval and achieving market acceptance and adequate reimbursement for its products386391 Risks Related to Financial Position and Need for Additional Capital Risks Related to Discovery, Development, Clinical Testing, Manufacturing and Regulatory Approval Risks Related to Healthcare Laws and Other Legal Compliance Matters Risks Related to Commercialization Risks Related to Our Dependence on Third Parties Risks Related to Intellectual Property Risks Related to Employee Matters and Managing Growth Risks Related to Our Ordinary Shares Unregistered Sales of Equity Securities and Use of Proceeds This section discloses the company's unregistered equity sales during the reporting period, including a May 2023 private placement and an April 2023 issuance from a prior acquisition - On May 5, 2023, the company completed a private placement, selling 10,773,913 ordinary shares at $5.75 per share for gross proceeds of $62 million530 - On April 4, 2023, the company issued 40,138 ordinary shares to former stockholders of Bullseye Therapeutics, Inc. as part of the 2021 merger agreement531 Defaults Upon Senior Securities This section indicates that there were no defaults upon senior securities during the reporting period - None532 Mine Safety Disclosures This section is not applicable to the company's operations - Not applicable534 Other Information This section indicates that there is no other information to report for the period - None535 Exhibits This section lists the exhibits filed with the Form 10-Q, including agreements, CEO and CFO certifications, and interactive data files (XBRL) - Exhibits filed include the Securities Purchase Agreement from May 2023, the Registration Rights Agreement, CEO and CFO certifications (Sections 302 and 906), and XBRL data files537
MeiraGTx(MGTX) - 2023 Q2 - Quarterly Report