Merus(US:MRUS)2023-05-04 20:06Financial Performance - Total revenue for Q1 2023 was $13.5 million, a 15.8% increase from $11.7 million in Q1 2022[16]. - Operating expenses increased to $50.3 million in Q1 2023, up 29.8% from $38.7 million in Q1 2022[16]. - Net loss for Q1 2023 was $39.7 million, compared to a net loss of $18.9 million in Q1 2022, representing a 109.5% increase in losses[16]. - Basic and diluted net loss per share for Q1 2023 was $0.86, compared to $0.43 in Q1 2022[16]. - The company reported a net cash used in operating activities of $36.7 million for Q1 2023, compared to $46.4 million in Q1 2022[19]. - The company expects to continue incurring significant expenses and operating losses for the foreseeable future[12]. - As of March 31, 2023, the company reported an accumulated deficit of $637.9 million[25]. - The company anticipates needing additional financing to support ongoing operations and may pursue public equity offerings or collaborations[26]. Cash and Assets - Cash and cash equivalents decreased to $102.6 million as of March 31, 2023, down from $147.7 million at the end of 2022[15]. - Total assets decreased to $338.5 million as of March 31, 2023, from $376.5 million at the end of 2022[15]. - The company holds $39.4 million in cash equivalents as of March 31, 2023, up from $18.4 million as of December 31, 2022[35]. - The total investments in debt securities increased from $197.3 million as of December 31, 2022, to $224.1 million as of March 31, 2023[35]. - The fair value of debt securities was $223.5 million as of March 31, 2023, compared to $196.3 million as of December 31, 2022[35]. - As of March 31, 2023, the company held marketable securities valued at $184.7 million, a decrease from $189.7 million as of March 31, 2022[128]. - The company has no outstanding debt subject to interest rate risk as of March 31, 2023[128]. Collaboration and Revenue - Collaboration revenue for Q1 2023 was $13.5 million, compared to $11.7 million in Q1 2022, indicating growth in collaborative efforts[16]. - Total collaboration revenue for the three months ended March 31, 2023, was $13.499 million, a 15.8% increase from $11.655 million in the same period of 2022[68]. - Upfront payments contributed $8.392 million to total collaboration revenue in Q1 2023, compared to $8.662 million in Q1 2022, reflecting a decrease of 3.1%[68]. - Eli Lilly agreed to pay the Company a $40.0 million non-refundable upfront payment and purchased 706,834 common shares for $20.0 million, totaling $60.0 million in initial collaboration funds[45]. - The transaction price at inception was $43.5 million, derived from the upfront payment and share purchase proceeds, with variable consideration associated with research funding[49]. - As of March 31, 2023, the Company recognized a $2.5 million milestone from Incyte related to the initiation of a Phase 1 study, with no additional milestones achieved during the same period[57]. - The Company has achieved three milestones under the Simcere Agreement, receiving an aggregate of $1.8 million in milestone payments before the agreement was terminated[64]. - Research activities under the Lilly collaboration are ongoing, with no milestones achieved to date as of March 31, 2023[54]. - The Company identified three performance obligations in the Simcere Agreement, with a total fixed consideration of $2.75 million allocated to these obligations[63]. - Lilly has the right to extend the research term to 2025 for an additional fee of $0.5 million, increasing the transaction price for one of the programs[53]. - The Company retains all rights not granted to Lilly, with potential future milestones and royalties dependent on product development and commercialization[46]. - The balance of deferred revenue as of March 31, 2023, was $61.0 million, down from $68.2 million at the beginning of the year, reflecting revenue recognized during the period[66]. - As of March 31, 2023, the balance of unbilled receivables was $2.6 million, primarily representing reimbursement revenue to be billed in the next period[67]. Expenses and Costs - Operating expenses increased to $50.3 million in Q1 2023, up 29.8% from $38.7 million in Q1 2022[16]. - Accrued research and development expenses rose to $31.98 million as of March 31, 2023, from $26.16 million as of December 31, 2022[38]. - Total lease costs included in operating expenses increased to $740,000 for the three months ended March 31, 2023, compared to $461,000 for the same period in 2022[44]. - Research and development expenses for Q1 2023 were $24,000, significantly lower than $360,000 in Q1 2022, indicating a reduction of 93.3%[68]. - Stock-based compensation expense totaled $5.750 million for Q1 2023, up from $5.334 million in Q1 2022, representing an increase of 7.8%[72]. Currency and Market Impact - A hypothetical 15% weakening of the U.S. dollar against the euro would have increased the net loss for Q1 2023 by approximately $6.3 million[129]. - The weighted-average grant date fair value of options granted in Q1 2023 was $10.29 per option[73]. - The company issued and sold 2,720,846 shares of common stock under the Sales Agreement, generating gross proceeds of $59.5 million as of December 31, 2022[71]. - No sales were made under the Sales Agreement during the three months ended March 31, 2023[71].