SpringWorks Therapeutics(SWTX) - 2024 Q1 - Quarterly Report

PART I – FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) Unaudited Q1 2024 financial statements detail $656.8 million in assets, an $87.4 million net loss, and $21.0 million in product revenue Condensed Consolidated Balance Sheets As of March 31, 2024, total assets were $656.8 million, decreasing from $725.8 million, with liabilities at $89.4 million and stockholders' equity at $567.4 million Condensed Consolidated Balance Sheet Highlights (in thousands) | | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Total current assets | $471,798 | $500,912 | | Total assets | $656,832 | $725,788 | | Total current liabilities | $68,917 | $78,170 | | Total liabilities | $89,392 | $99,569 | | Total stockholders' equity | $567,440 | $626,219 | Condensed Consolidated Statements of Operations Q1 2024 saw first product revenue of $21.0 million, increased operating expenses to $114.9 million, and a net loss of $87.4 million Condensed Consolidated Statements of Operations (in thousands, except per-share data) | | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Product revenue, net | $21,006 | $— | | Total operating costs and expenses | $114,937 | $77,699 | | Loss from operations | $(93,931) | $(77,699) | | Net loss | $(87,385) | $(73,420) | | Net loss per share, basic and diluted | $(1.18) | $(1.18) | Condensed Consolidated Statements of Cash Flows Q1 2024 net cash used in operating activities increased to $78.9 million, while investing activities provided $21.5 million, resulting in a $58.0 million net decrease in cash Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(78,930) | $(61,818) | | Net cash provided by investing activities | $21,463 | $98,604 | | Net cash used in financing activities | $(552) | $(1,848) | | Net (decrease) increase in cash and cash equivalents | $(58,019) | $34,938 | Notes to Condensed Consolidated Financial Statements Notes detail the company's transition to commercial stage with OGSIVEO, $21.0 million Q1 revenue, and $573.0 million liquidity sufficient for twelve months - The company is a commercial-stage biopharmaceutical firm with its first product, OGSIVEO, approved in November 2023 for desmoid tumors. It generated $21.0 million in net revenue in Q1 2024[26] - As of March 31, 2024, the company had $573.0 million in cash, cash equivalents, and marketable securities, which management estimates will fund operations for at least the next twelve months[27] - In January 2024, the company made an additional investment of $8.2 million in MapKure for Series C preferred units, increasing its ownership interest to 39.7%[44] Equity-Based Compensation Expense (in thousands) | | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Research and development | $12,423 | $8,918 | | Selling, general and administrative | $18,039 | $14,477 | | Total | $30,462 | $23,395 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) MD&A discusses Q1 2024 financial performance, including $21.0 million OGSIVEO revenue, increased operating expenses, and sufficient liquidity for the next year Overview SpringWorks is a commercial-stage biopharma company with FDA-approved OGSIVEO, advancing mirdametinib, and developing other pipeline assets - OGSIVEO (nirogacestat) was approved by the FDA on November 27, 2023, for adult patients with progressing desmoid tumors and is the first and only FDA-approved therapy for this indication[65] - The company initiated a rolling New Drug Application (NDA) submission for mirdametinib for NF1-PN in March 2024, with completion expected in Q2 2024[70] - The company plans to initiate a Phase 1a trial of SW-682, a TEAD inhibitor development candidate, in Hippo mutant solid tumors in the second quarter of 2024[73] - In March 2024, the company terminated its license agreement with Dana-Farber for a portfolio of EGFR inhibitors, ceasing further investment in the program[74] Results of Operations Q1 2024 saw $21.0 million product revenue, a 48% increase in total operating expenses to $114.9 million, and an $87.4 million net loss Comparison of Results of Operations (in thousands) | | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Product revenue, net | $21,006 | $— | $21,006 | —% | | Selling, general and administrative | $60,113 | $44,175 | $15,938 | 36% | | Research and development | $53,622 | $33,524 | $20,098 | 60% | | Total operating costs and expenses | $114,937 | $77,699 | $37,238 | 48% | | Net loss | $(87,385) | $(73,420) | $(13,965) | 19% | - SG&A expenses increased by $15.9 million (36%) in Q1 2024, primarily due to commercial activities supporting the U.S. launch of OGSIVEO, including growth of the commercial organization and sales force[87][88] Research and Development Expenses by Program (in thousands) | Program | Q1 2024 | Q1 2023 | $ Change | | :--- | :--- | :--- | :--- | | Nirogacestat | $13,700 | $7,256 | $6,444 | | Mirdametinib | $16,155 | $6,499 | $9,656 | | Other | $9,583 | $1,987 | $7,596 | | Total program specific costs | $39,438 | $15,742 | $23,696 | Liquidity and Capital Resources The company had an accumulated deficit of $982.4 million, with $573.0 million in liquidity, estimated to fund operations for at least the next twelve months - The company had an accumulated deficit of $982.4 million as of March 31, 2024, and management estimates its current liquidity will fund operations for at least twelve months after the filing date of the report[94] Summary of Cash Flows (in thousands) | | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(78,930) | $(61,818) | | Net cash provided by investing activities | $21,463 | $98,604 | | Net cash used in financing activities | $(552) | $(1,848) | Item 3. Quantitative and Qualitative Disclosure About Market Risk No material changes to the company's market risks from those described in its 2023 Form 10-K - There were no material changes to the company's market risks from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2023[108] Item 4. Controls and Procedures Management concluded disclosure controls and procedures were effective, with no material changes in internal control over financial reporting - Management concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[109] - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control[110] PART II. OTHER INFORMATION Item 1. Legal Proceedings The company is not currently a party to any material legal proceedings - The company is not currently a party to any material legal proceedings[111] Item 1A. Risk Factors No material changes in the company's risk factors from those disclosed in the 2023 Form 10-K - There have been no material changes in the company's risk factors from those disclosed in the 2023 Form 10-K[112] Item 5. Other Information Several directors and executive officers adopted Rule 10b5-1 trading plans during Q1 2024 - Several directors and executive officers, including the CEO (Saqib Islam), COO (Badreddin Edris), and CCO (Bhavesh Ashar), adopted Rule 10b5-1 trading plans during the quarter ended March 31, 2024[117] Item 6. Exhibits This section lists exhibits filed with the Form 10-Q, including required CEO and CFO certifications - The report includes an index of exhibits filed, such as CEO and CFO certifications pursuant to Section 302 and Section 906 of the Sarbanes-Oxley Act[119]