Tyra Biosciences(TYRA) - 2022 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION Financial Statements Unaudited financial statements for H1 2022 reflect decreased assets, increased liabilities, and significant operating losses from higher R&D and G&A expenses Balance Sheets As of June 30, 2022, total assets decreased to $287.1 million, while liabilities increased and equity decreased, reflecting the period's net loss Balance Sheet Summary (in thousands) | Balance Sheet Items | June 30, 2022 (unaudited) | December 31, 2021 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $275,107 | $302,182 | | Total current assets | $277,299 | $304,057 | | Total assets | $287,118 | $306,701 | | Liabilities and Stockholders' Equity | | | | Total current liabilities | $5,455 | $3,616 | | Total liabilities | $8,265 | $4,964 | | Accumulated deficit | $(70,292) | $(40,371) | | Total stockholders' equity | $278,853 | $301,737 | Statements of Operations and Comprehensive Loss Net loss significantly increased to $29.9 million for H1 2022, driven by substantial rises in research and development and general and administrative expenses Operating Results Summary (in thousands, except per share data) | Metric | Three Months Ended June 30, 2022 | Three Months Ended June 30, 2021 | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $12,047 | $4,381 | $21,692 | $7,902 | | General and administrative | $3,381 | $1,127 | $8,570 | $1,816 | | Total operating expenses | $15,428 | $5,508 | $30,262 | $9,718 | | Loss from operations | $(15,428) | $(5,508) | $(30,262) | $(9,718) | | Net loss | $(15,095) | $(5,512) | $(29,921) | $(9,721) | | Net loss per share | $(0.36) | $(2.43) | $(0.72) | $(4.54) | Statements of Cash Flows Net cash used in operating activities significantly increased to $26.1 million for H1 2022, while financing cash flow decreased, resulting in a $26.3 million net cash decrease Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | $(26,093) | $(9,139) | | Net cash used in investing activities | $(490) | $(300) | | Net cash provided by financing activities | $265 | $129,419 | | Net cash (decrease) increase | $(26,318) | $119,980 | Notes to Financial Statements Notes detail the company's precision oncology focus, IPO proceeds of $181.2 million, management's liquidity assessment, stock-based compensation, and new lease agreements - The company is a precision oncology firm focused on developing therapies to overcome therapy resistance in cancer patients[18] - Management believes it has sufficient working capital to fund operations through at least the next twelve months from the report's issuance date[24] - In September 2021, upon completing its IPO, all convertible preferred stock was converted into 26,228,089 shares of common stock[39] - In March 2022, the company entered into an expansion lease for additional office and laboratory space, with projected lease payments of $5.5 million over a 120-month term starting in Q2 2023[57] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's oncology pipeline, including FDA clearance for TYRA-300, significant increases in operating expenses, and liquidity sufficient to fund operations through at least 2024 - The company is a precision oncology company focused on developing therapies to overcome tumor resistance, with lead candidates TYRA-300 (FGFR3 inhibitor) and TYRA-200 (FGFR2 inhibitor)[64] - An Investigational New Drug (IND) application for TYRA-300 was submitted in June 2022, and the company received FDA clearance in July 2022 to proceed with its Phase 1/2 clinical study (SURF301)[64] - The company expects to continue incurring significant expenses and operating losses as it advances its product candidates through clinical trials and expands its pipeline[67][72] - Based on the current operating plan, existing cash and cash equivalents of $275.1 million are expected to be sufficient to fund operations and capital expenditures through at least 2024[68][95] Results of Operations Operating expenses sharply increased for H1 2022, with R&D rising to $21.7 million due to program advancement and G&A increasing to $8.6 million from higher personnel and public company costs R&D Expenses by Program (Six Months Ended June 30, in thousands) | Program | 2022 | 2021 | | :--- | :--- | :--- | | TYRA-300 | $5,352 | $2,818 | | TYRA-200 | $2,864 | $1,391 | | FGFR3 ACH | $1,392 | $— | | RET | $2,589 | $817 | | FGFR4 | $1,084 | $356 | | Unallocated & Personnel | $7,941 | $2,513 | | Total R&D Expense | $21,692 | $7,902 | - The increase in R&D expenses for the six months ended June 30, 2022 was primarily due to advancing TYRA-300 and TYRA-200, including $4.7 million in higher personnel-related costs (of which $2.8 million was non-cash stock-based compensation)[84] - The increase in G&A expenses for the six months ended June 30, 2022 was mainly due to a $4.5 million increase in personnel-related expenses (including $3.3 million in non-cash stock-based compensation) and higher professional fees and operating costs[86] Liquidity and Capital Resources Liquidity is primarily from $181.2 million IPO proceeds, with $275.1 million cash as of June 30, 2022, expected to fund operations through at least 2024, though future capital may be required - The company completed its IPO on September 17, 2021, raising net proceeds of approximately $181.2 million[87] Summary of Cash Flows (Six Months Ended June 30, in thousands) | Category | 2022 | 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | $(26,093) | $(9,139) | | Net cash used in investing activities | $(490) | $(300) | | Net cash provided by financing activities | $265 | $129,419 | - Future funding requirements will depend on many factors, including the costs and timing of clinical trials, manufacturing, and regulatory reviews[96] Quantitative and Qualitative Disclosures About Market Risk No material changes to market risk exposures, including interest rate, foreign currency, and inflation risks, have occurred since the 2021 Annual Report disclosures - As of June 30, 2022, there were no material changes to the company's market risk exposures from those discussed in the 2021 Annual Report[102] Controls and Procedures Management concluded disclosure controls and procedures were effective as of June 30, 2022, with internal control over financial reporting evaluation deferred until year-end 2022 - Management concluded that as of the end of the quarter, the company's disclosure controls and procedures were effective[105] - As a newly public company, management is not yet required to evaluate the effectiveness of internal control over financial reporting until the Annual Report for the year ending December 31, 2022[106] PART II. OTHER INFORMATION Legal Proceedings The company is not currently subject to any material legal proceedings - The company is not currently a party to any material legal proceedings[109] Risk Factors No material changes have occurred to the risk factors previously disclosed in the company's 2021 Annual Report on Form 10-K - No material changes have occurred to the risk factors disclosed in the 2021 Annual Report[110] Unregistered Sales of Equity Securities and Use of Proceeds No unregistered sales of equity securities occurred, and the $181.2 million net IPO proceeds' planned use remains materially unchanged - The company's IPO in September 2021 generated net proceeds of approximately $181.2 million after deducting underwriting discounts and offering costs[112] - There has been no material change in the planned use of proceeds from the IPO as described in the final prospectus[113] Exhibits This section lists exhibits filed with the Form 10-Q, including corporate governance documents and CEO/CFO certifications - The report includes a list of exhibits filed, such as the CEO and CFO certifications required under the Sarbanes-Oxley Act of 2002[118]