Immunovant(US:IMVT)2024-05-29 20:36Part I Business Immunovant is a clinical-stage immunology company developing anti-FcRn antibodies, IMVT-1402 and batoclimab, for autoimmune diseases - The company's core strategy is to develop its lead asset, IMVT-1402, for a wide range of autoimmune diseases, leveraging its potential best-in-class profile of potent IgG reduction without the associated negative effects on albumin and LDL cholesterol seen in other FcRn inhibitors273135 Development Pipeline | Investigational Compound | Therapeutic Area | Target Indication | Stage of Development | | :--- | :--- | :--- | :--- | | IMVT-1402 | Autoimmune Diseases | | Phase 1 | | Batoclimab | Neurological Diseases | Myasthenia Gravis (MG) | Pivotal Trial (Phase 3) | | | | Chronic Inflammatory Demyelinating Polyneuropathy (CIDP) | Pivotal Trial (Phase 2b) | | | Endocrine Diseases | Thyroid Eye Disease (TED) | Pivotal Trials (Phase 3) | | | | Graves' Disease (GD) | Proof of Concept Study (Phase 2) | - IMVT-1402 demonstrated a statistically significant 74% reduction in mean total IgG levels after four weekly 600 mg subcutaneous doses in a Phase 1 trial, with no or minimal impact on albumin and LDL cholesterol levels, similar to placebo56 - The company plans an aggressive development timeline for IMVT-1402, aiming to initiate 4-5 potentially registrational programs by March 31, 2025, and a total of ten indications by March 31, 20263561 - Under the license agreement with HanAll Biopharma, Immunovant is obligated to pay up to an aggregate of $420.0 million in future regulatory and sales milestones, in addition to tiered royalties on net sales107 - The company faces significant competition from other FcRn inhibitors, including approved products like VYVGART® (efgartigimod) from argenx and RYSTIGGO® (rozanolixizumab) from UCB, as well as candidates in development from Johnson & Johnson and Viridian Therapeutics120268 Risk Factors The company faces substantial risks related to product development, regulatory approval, competition, financial sustainability, and third-party reliance - The business is entirely dependent on the successful and timely development, regulatory approval, and commercialization of its product candidates, IMVT-1402 and batoclimab235 - Adverse events are a significant risk. Batoclimab clinical trials were previously paused due to treatment-induced elevations in total cholesterol and LDL levels, which could impact long-term risk-benefit assessment and regulatory approval239241 - The company faces intense competition from other FcRn inhibitors, including FDA-approved VYVGART® Hytrulo and RYSTIGGO®, and candidates in development from major pharmaceutical companies like Johnson & Johnson268 - As of May 22, 2024, Roivant Sciences Ltd. (RSL) beneficially owned approximately 54.6% of the company's voting power, making Immunovant a "controlled company" and giving RSL significant influence over matters subject to stockholder approval457 - The company has a limited operating history, has never generated product revenue, and expects to incur significant losses for the foreseeable future. As of March 31, 2024, the accumulated deficit was $825.7 million324327 - The company relies on a license agreement with HanAll Biopharma for the core intellectual property of IMVT-1402 and batoclimab. Termination of this agreement would severely impact the business340 Unresolved Staff Comments The company reports that it has no unresolved staff comments from the SEC - There are no unresolved staff comments486 Cybersecurity The company has established processes to manage cybersecurity risks, integrated into its overall enterprise risk management - The company's cybersecurity risk management is integrated into its overall enterprise risk management process, focusing on data protection, access control, and incident response487 - Oversight is provided by the Audit Committee of the Board of Directors, which receives management updates on cybersecurity matters at least twice annually492 - Operational leadership for cybersecurity is provided by the VP of Information Technology and Facilities and the Head of Cybersecurity, who possess over 16 and 15 years of relevant experience, respectively493 Properties The company conducts its business operations from leased office spaces in New York, NY, and Durham, NC, with international subsidiary offices - The company's primary U.S. operations are located at 320 West 37th Street, New York, NY and 1000 Park Forty Plaza, Durham, NC495 - International subsidiary offices are located in Hamilton, Bermuda; London, UK; and Basel, Switzerland495 Legal Proceedings A securities class action complaint filed in February 2021 was dismissed with prejudice in March 2024, concluding the litigation - A putative securities class action complaint filed against the company in February 2021 was dismissed with prejudice on March 29, 2024. The litigation is now concluded as the plaintiffs did not appeal the judgment698 Mine Safety Disclosures This item is not applicable to the company - Not applicable499 Part II Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The company's common stock trades on The Nasdaq Global Select Market, and it has never paid cash dividends - The company's common stock is listed on The Nasdaq Global Select Market under the ticker symbol "IMVT"502 - The company has never declared or paid dividends and does not plan to in the foreseeable future, retaining all future earnings for business operations504 Management's Discussion and Analysis of Financial Condition and Results of Operations The company reported an increased net loss for FY2024, driven by higher R&D and G&A expenses, with its cash position significantly strengthened by a recent equity offering Results of Operations | | Years Ended March 31, | Change | | :--- | :--- | :--- | :--- | | | 2024 (in thousands) | 2023 (in thousands) | $ (in thousands) | | Research and development | $212,928 | $160,257 | $52,671 | | Acquired in-process R&D | $12,500 | $10,000 | $2,500 | | General and administrative | $57,281 | $48,019 | $9,262 | | Net loss | $(259,336) | $(210,960) | $(48,376) | - The increase in R&D expenses was primarily driven by a $32.8 million rise in costs for the IMVT-1402 program and a $25.2 million increase in unallocated personnel-related expenses due to higher headcount547548 - The company's cash and cash equivalents increased to $635.4 million as of March 31, 2024, from $376.5 million a year prior, mainly due to net proceeds of $466.7 million from an underwritten public offering and concurrent private placement in October 2023552555 - Management expects that existing cash and cash equivalents are sufficient to fund operating expenses and capital expenditure requirements for at least the next 12 months from the filing date572 Quantitative and Qualitative Disclosures About Market Risk The company is not required to provide this information as it qualifies as a "smaller reporting company" - The company is exempt from this disclosure requirement because it is a "smaller reporting company"579 Financial Statements and Supplementary Data The audited financial statements for FY2024 show an increased net loss, a substantial accumulated deficit, and a significant rise in stockholders' equity due to recent equity financing Consolidated Balance Sheet Data | | March 31, 2024 (in thousands) | March 31, 2023 (in thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $635,365 | $376,532 | | Total assets | $666,365 | $405,838 | | Total liabilities | $48,608 | $43,344 | | Accumulated deficit | $(825,683) | $(566,347) | | Total stockholders' equity | $617,757 | $362,494 | Consolidated Statement of Operations Data | | Year Ended March 31, 2024 (in thousands) | Year Ended March 31, 2023 (in thousands) | | :--- | :--- | :--- | | Research and development | $212,928 | $160,257 | | General and administrative | $57,281 | $48,019 | | Net loss | $(259,336) | $(210,960) | | Net loss per share | $(1.88) | $(1.71) | - The company achieved development and regulatory milestones under the HanAll Agreement, resulting in acquired IPR&D expenses of $12.5 million in fiscal 2024 and $10.0 million in fiscal 2023651 - As of March 31, 2024, the company has a remaining minimum purchase commitment of approximately $46.2 million under its manufacturing agreement with Samsung Biologics654699 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None reported702 Controls and Procedures Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of March 31, 2024 - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of March 31, 2024705 - Management concluded that the company's internal control over financial reporting was effective as of March 31, 2024, based on the COSO 2013 framework709 - The independent registered public accounting firm, Ernst & Young LLP, issued an unqualified opinion on the effectiveness of the company's internal control over financial reporting as of March 31, 2024710714 Other Information No directors or Section 16 reporting officers adopted, modified, or terminated any Rule 10b5-1 trading arrangement during the fourth quarter - No directors or Section 16 officers adopted, modified, or terminated a Rule 10b5-1 trading plan during the fourth quarter721 Disclosure Regarding Foreign Jurisdictions that Prevent Inspections This item is not applicable to the company - Not applicable722 Part III Directors, Executive Officers and Corporate Governance Information for this item will be provided in the company's 2024 Proxy Statement and is incorporated by reference - Information for this item is incorporated by reference from the registrant's definitive Proxy Statement for its 2024 Annual Meeting of Stockholders724725 Executive Compensation Information for this item will be provided in the company's 2024 Proxy Statement and is incorporated by reference - Information for this item is incorporated by reference from the registrant's definitive Proxy Statement for its 2024 Annual Meeting of Stockholders724727 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Information for this item will be provided in the company's 2024 Proxy Statement and is incorporated by reference - Information for this item is incorporated by reference from the registrant's definitive Proxy Statement for its 2024 Annual Meeting of Stockholders724728 Certain Relationships and Related Transactions, and Director Independence Information for this item will be provided in the company's 2024 Proxy Statement and is incorporated by reference - Information for this item is incorporated by reference from the registrant's definitive Proxy Statement for its 2024 Annual Meeting of Stockholders724729 Principal Accountant Fees and Services Information for this item will be provided in the company's 2024 Proxy Statement and is incorporated by reference - Information for this item is incorporated by reference from the registrant's definitive Proxy Statement for its 2024 Annual Meeting of Stockholders724730 Part IV Exhibit and Financial Statement Schedules This section lists the documents filed as part of the Annual Report, including financial statements and a comprehensive list of exhibits - All required financial statements are included in Part II, Item 8 of the report732 - A list of exhibits filed with the report is provided, including the License Agreement with HanAll BioPharma, the Master Services Agreement with Samsung Biologics, and various equity incentive plans734735 Form 10-K Summary The company has not provided a summary for its Form 10-K - None738