sensei(SNSE) - 2022 Q3 - Quarterly Report

PART I FINANCIAL INFORMATION Condensed Consolidated Financial Statements (Unaudited) These unaudited statements detail the company's financial position and performance for the periods ended September 30, 2022 Condensed Consolidated Balance Sheets The balance sheets show a decrease in total assets and an increase in total liabilities as of September 30, 2022 Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | Sep 30, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Cash and cash equivalents | $11,450 | $7,159 | | Marketable securities | $105,108 | $140,462 | | Total Assets | $128,803 | $153,225 | | Total Liabilities | $14,817 | $6,712 | | Accumulated deficit | ($185,562) | ($149,206) | | Total Stockholders' Equity | $113,986 | $146,513 | Condensed Consolidated Statements of Operations and Comprehensive Loss Operating expenses and net loss increased for the three and nine months ended September 30, 2022, driven by R&D Statement of Operations Highlights (in thousands, except per share data) | Metric | Q3 2022 | Q3 2021 | 9 Months 2022 | 9 Months 2021 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $9,190 | $6,443 | $23,038 | $15,706 | | General and administrative | $4,751 | $3,873 | $14,102 | $12,363 | | Loss from operations | ($13,941) | ($10,316) | ($37,140) | ($28,069) | | Net loss | ($13,416) | ($9,685) | ($36,356) | ($27,428) | | Net loss per share | ($0.44) | ($0.32) | ($1.18) | ($1.03) | Condensed Consolidated Statements of Cash Flows Cash flow statements show increased cash used in operations, with investing activities providing cash due to marketable securities Cash Flow Summary (in thousands) | Cash Flow Activity | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($29,452) | ($22,391) | | Net cash provided by (used in) investing activities | $33,906 | ($148,730) | | Net cash (used in) provided by financing activities | ($163) | $164,058 | | Net increase (decrease) in cash | $4,291 | ($7,063) | Notes to Condensed Consolidated Financial Statements These notes detail the company's business, liquidity, accounting policies, commitments, and equity transactions - The company is an early-stage biopharmaceutical firm focused on cancer therapeutics, requiring significant capital for R&D and testing before revenue generation[20][21] - As of September 30, 2022, cash, cash equivalents, and marketable securities totaled $116.6 million, expected to fund operations for at least the next twelve months[24] - The company adopted ASC 842 on January 1, 2022, recognizing operating lease liabilities of $6.7 million and right-of-use assets of $6.6 million[38] - The company is involved in litigation in Ontario, Canada, but management believes the outcome will not materially impact its financial position[57] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the TMAb™ platform, increased operating losses, and liquidity expected to fund operations through Q1 2025 Overview and Pipeline The company focuses on its TMAb™ platform for immuno-oncology therapeutics, with SNS-101 as its lead candidate - The company's lead product candidate is SNS-101, a monoclonal antibody targeting the VISTA immune checkpoint, with an Investigational New Drug (IND) application planned for submission in the first half of 2023[88] - The ImmunoPhage™ platform, including SNS-401-NG, was suspended to focus all resources on the TMAb™ platform[90] Results of Operations Operating expenses, particularly R&D and G&A, increased for the three and nine months ended September 30, 2022 Comparison of Operating Results (in thousands) | Period | R&D Expense | G&A Expense | Net Loss | | :--- | :--- | :--- | :--- | | Q3 2022 | $9,190 | $4,751 | ($13,416) | | Q3 2021 | $6,443 | $3,873 | ($9,685) | | 9 Months 2022 | $23,038 | $14,102 | ($36,356) | | 9 Months 2021 | $15,706 | $12,363 | ($27,428) | - The $7.3 million increase in R&D expenses for the nine-month period was primarily due to a $4.4 million increase in manufacturing contracts, $1.6 million in higher preclinical contract research, and a $1.3 million increase in personnel costs[112] - The $1.7 million increase in G&A expenses for the nine-month period was mainly attributable to higher non-income tax expense, increased D&O insurance costs, and higher professional fees[113] Liquidity and Capital Resources The company's liquidity, primarily from equity sales, totals $116.6 million, sufficient to fund operations into Q1 2025 - As of September 30, 2022, the company had cash, cash equivalents, and marketable securities of $116.6 million[117] - The company expects its existing cash and cash equivalents will be sufficient to fund operating expenses and capital expenditure requirements at least into the first quarter of 2025[126] - The company's primary source of funding has been equity sales, including net proceeds of $138.5 million from its IPO in February 2021[116][117] Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, the company is exempt from market risk disclosures - The company is a smaller reporting company as defined by Item 10 of Regulation S-K and is not required to provide quantitative and qualitative disclosures about market risk[139] Controls and Procedures Disclosure controls and procedures were effective as of September 30, 2022, with no material changes in internal control - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of September 30, 2022[142] - No material changes occurred in the company's internal control over financial reporting during the three months ended September 30, 2022[143] PART II OTHER INFORMATION Legal Proceedings The company is not currently involved in any material legal proceedings - The company is not currently a party to any material legal proceedings[146] Risk Factors This section details material risks across financial, operational, developmental, regulatory, and intellectual property areas - The company has a history of significant losses and will require substantial additional funding to complete the development of its product candidates[149] - The company's business is highly dependent on the success of its early-stage product candidates, which face significant risks in clinical development and regulatory approval[149] - The company relies on third parties for manufacturing and conducting clinical trials, which introduces risks related to performance, deadlines, and regulatory compliance[150] - Risks related to intellectual property include the ability to obtain and maintain patent protection and potential infringement claims from third parties[153] Unregistered Sales of Equity Securities and Use of Proceeds No unregistered equity sales occurred, and IPO proceeds of $138.5 million are being used as planned - The company had no unregistered sales of equity securities in the reported period[377] - There has been no material change in the planned use of proceeds from the company's IPO, which generated net proceeds of $138.5 million[378][380] Defaults Upon Senior Securities The company reports no defaults upon senior securities - None[382] Mine Safety Disclosures This item is not applicable to the company - Not applicable[383] Other Information The company reports no other information for this item - None[384] Exhibits This section lists exhibits, including CEO/CFO certifications and XBRL financial data - The report includes CEO and CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906, as well as Inline XBRL financial data[385]