0000950170-22-016035.txt : 20220809 0000950170-22-016035.hdr.sgml : 20220809 20220809160655 ACCESSION NUMBER: 0000950170-22-016035 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 63 CONFORMED PERIOD OF REPORT: 20220630 FILED AS OF DATE: 20220809 DATE AS OF CHANGE: 20220809 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Reneo Pharmaceuticals, Inc. CENTRAL INDEX KEY: 0001637715 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 472309515 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-40315 FILM NUMBER: 221148272 BUSINESS ADDRESS: STREET 1: 18575 JAMBOREE ROAD STREET 2: SUITE 275-S CITY: IRVINE STATE: CA ZIP: 92612 BUSINESS PHONE: (858) 283-0280 MAIL ADDRESS: STREET 1: 18575 JAMBOREE ROAD STREET 2: SUITE 275-S CITY: IRVINE STATE: CA ZIP: 92612 10-Q 1 rphm-20220630.htm 10-Q 10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

 

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022

or

 

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-40315

 

 

img26604459_0.jpg 

Reneo Pharmaceuticals, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

 

 

Delaware

47-2309515

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

 

 

18575 Jamboree Road, Suite 275-S, Irvine, CA

(Address of Principal Executive Offices)

92612

(Zip Code)

(Registrant’s telephone number, including area code): (858) 283-0280

 

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading symbol

 

Name of each exchange on which registered

Common Stock, par value $0.0001 per share

 

RPHM

 

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

 

 

 

 

 

 

 

 

Large accelerated filer

 

 

 

 

Accelerated filer

 

 

 

 

 

 

Smaller reporting company

Non-accelerated filer

 

 

 

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

As of August 4, 2022, there were 24,479,646 shares of the registrant’s common stock, $0.0001 par value per share, outstanding.

 

 

 

 


 

TABLE OF CONTENTS

 

 

 

 

Page

 

 

 

 

Part I

 

Financial Information

3

 

 

 

 

Item 1.

 

Consolidated Financial Statements (Unaudited)

3

 

 

 

 

 

 

Consolidated Balance Sheets

3

 

 

 

 

 

 

Consolidated Statements of Operations and Comprehensive Loss

4

 

 

 

 

 

 

Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders’ Equity (Deficit)

5

 

 

 

 

 

 

Consolidated Statements of Cash Flows

7

 

 

 

 

 

 

Notes to Consolidated Financial Statements (Unaudited)

8

 

 

 

 

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

17

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures about Market Risk

25

 

 

 

 

Item 4.

 

Controls and Procedures

25

 

 

 

 

Part II

 

Other Information

26

 

 

 

 

Item 1.

 

Legal Proceedings

26

 

 

 

 

Item 1A.

 

Risk Factors

26

 

 

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

85

 

 

 

 

Item 3.

 

Defaults Upon Senior Securities

85

 

 

 

 

Item 4.

 

Mine Safety Disclosures

85

 

 

 

 

Item 5.

 

Other Information

85

 

 

 

 

Item 6.

 

Exhibits

86

 

 

 

 

Signatures

 

 

87

 

 

2


 

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

RENEO PHARMACEUTICALS, INC.

Consolidated Balance Sheets

(In thousands, except share and par value data)

 

 

 

June 30,
2022

 

 

December 31,
2021

 

 

 

(Unaudited)

 

 

 

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

118,264

 

 

$

124,660

 

Short-term investments

 

 

8,588

 

 

 

23,010

 

Prepaid expenses and other current assets

 

 

5,159

 

 

 

6,064

 

Total current assets

 

 

132,011

 

 

 

153,734

 

Property and equipment, net

 

 

236

 

 

 

212

 

Right-of-use assets

 

 

1,283

 

 

 

 

Other non-current assets

 

 

78

 

 

 

78

 

Total assets

 

$

133,608

 

 

$

154,024

 

Liabilities and stockholders’ equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

1,560

 

 

$

2,022

 

Accrued expenses

 

 

6,367

 

 

 

4,180

 

Operating lease liabilities, current portion

 

 

408

 

 

 

 

Total current liabilities

 

 

8,335

 

 

 

6,202

 

Operating lease liabilities, less current portion

 

 

1,061

 

 

 

 

Other long-term liabilities

 

 

 

 

 

167

 

Performance award

 

 

55

 

 

 

444

 

Total liabilities

 

 

9,451

 

 

 

6,813

 

Commitments and contingencies

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Common stock, $0.0001 par value; 200,000,000 shares authorized at June 30, 2022 and
   December 31, 2021;
24,479,646 shares issued and outstanding at June 30, 2022; and
   
24,457,838 and 24,455,390 shares issued and outstanding at December 31, 2021, respectively

 

 

3

 

 

 

3

 

Additional paid-in capital

 

 

234,062

 

 

 

231,902

 

Accumulated deficit

 

 

(110,076

)

 

 

(84,728

)

Accumulated other comprehensive income

 

 

168

 

 

 

34

 

Total stockholders’ equity

 

 

124,157

 

 

 

147,211

 

Total liabilities and stockholders’ equity

 

$

133,608

 

 

$

154,024

 

 

The accompanying notes are an integral part of these consolidated financial statements.

3


 

RENEO PHARMACEUTICALS, INC.

Consolidated Statements of Operations and Comprehensive Loss

(In thousands, except share and per share data)

(Unaudited)

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

$

8,132

 

 

$

6,279

 

 

$

17,410

 

 

$

11,751

 

General and administrative

 

 

4,299

 

 

 

2,949

 

 

 

8,036

 

 

 

4,691

 

Total operating expenses

 

 

12,431

 

 

 

9,228

 

 

 

25,446

 

 

 

16,442

 

Loss from operations

 

 

(12,431

)

 

 

(9,228

)

 

 

(25,446

)

 

 

(16,442

)

Other income

 

 

119

 

 

 

12

 

 

 

98

 

 

 

14

 

Net loss

 

 

(12,312

)

 

 

(9,216

)

 

 

(25,348

)

 

 

(16,428

)

Unrealized gain on short-term investments

 

 

104

 

 

 

5

 

 

 

134

 

 

 

5

 

Comprehensive loss

 

$

(12,208

)

 

$

(9,211

)

 

$

(25,214

)

 

$

(16,423

)

Net loss per share attributable to common stockholders, basic and diluted

 

$

(0.50

)

 

$

(0.43

)

 

$

(1.04

)

 

$

(1.40

)

Weighted-average shares used in computing net loss per share, basic and diluted

 

 

24,463,824

 

 

 

21,364,369

 

 

 

24,461,085

 

 

 

11,770,948

 

 

The accompanying notes are an integral part of these consolidated financial statements.

4


 

RENEO PHARMACEUTICALS, INC.

Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders’ Equity (Deficit)

(In thousands, except share data)

(Unaudited)

 

 

 

Convertible
Preferred Stock

 

 

 

 

 

 

 

 

 

Additional

 

 

Accumulated
Other

 

 

 

 

 

Total

 

 

 

Series A

 

 

Series B

 

 

 

Common Stock

 

 

Paid-In

 

 

Comprehensive

 

 

Accumulated

 

 

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Income

 

 

Deficit

 

 

Equity

 

Balances, December 31, 2021

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

24,455,390

 

 

$

3

 

 

$

231,902

 

 

$

34

 

 

$

(84,728

)

 

$

147,211

 

Stock based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,107

 

 

 

 

 

 

 

 

 

1,107

 

Issuance of common stock in
   connection with equity plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3,160

 

 

 

 

 

 

6

 

 

 

 

 

 

 

 

 

6

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30

 

 

 

 

 

 

30

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(13,036

)

 

 

(13,036

)

Balances, March 31, 2022

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

24,458,550

 

 

$

3

 

 

$

233,015

 

 

$

64

 

 

$

(97,764

)

 

$

135,318

 

Stock based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,006

 

 

 

 

 

 

 

 

 

1,006

 

Issuance of commons stock in
   connection with equity plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

21,096

 

 

 

 

 

 

41

 

 

 

 

 

 

 

 

 

41

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

104

 

 

 

 

 

 

104

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(12,312

)

 

 

(12,312

)

Balances, June 30, 2022

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

24,479,646

 

 

$

3

 

 

$

234,062

 

 

$

168

 

 

$

(110,076

)

 

$

124,157

 

 

The accompanying notes are an integral part of these consolidated financial statements.

5


 

RENEO PHARMACEUTICALS, INC.

Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders’ Equity (Deficit) (Continued)

(In thousands, except share data)

(Unaudited)

 

 

 

Convertible
Preferred Stock

 

 

 

 

 

 

 

 

 

Additional

 

 

Accumulated
Other

 

 

 

 

 

Total

 

 

 

Series A

 

 

Series B

 

 

 

Common Stock

 

 

Paid-In

 

 

Comprehensive

 

 

Accumulated

 

 

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Income

 

 

Deficit

 

 

Equity (Deficit)

 

Balances, December 31, 2020

 

 

24,302,472

 

 

$

45,652

 

 

 

23,440,514

 

 

$

47,068

 

 

 

 

2,053,070

 

 

 

 

 

$

2,843

 

 

$

 

 

$

(44,958

)

 

$

(42,115

)

Issuance of series B convertible
   preferred stock, net of issuance
   costs of $
29

 

 

 

 

 

 

 

 

23,440,514

 

 

 

47,356

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

471

 

 

 

 

 

 

 

 

 

471

 

Issuance of common stock in
   connection with equity plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

70,663

 

 

 

 

 

 

139

 

 

 

 

 

 

 

 

 

139

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(7,212

)

 

 

(7,212

)

Balances, March 31, 2021

 

 

24,302,472

 

 

$

45,652

 

 

 

46,881,028

 

 

$

94,424

 

 

 

 

2,123,733

 

 

$

 

 

$

3,453

 

 

$

 

 

$

(52,170

)

 

$

(48,717

)

Conversion of convertible preferred
   stock into common stock upon
   initial public offering

 

 

(24,302,472

)

 

 

(45,652

)

 

 

(46,881,028

)

 

 

(94,424

)

 

 

 

15,907,629

 

 

 

2

 

 

 

140,076

 

 

 

 

 

 

 

 

 

140,078

 

Issuance of common stock in initial
   public offering, net of offering costs

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6,250,000

 

 

 

1

 

 

 

84,532

 

 

 

 

 

 

 

 

 

84,533

 

Stock based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

854

 

 

 

 

 

 

 

 

 

854

 

Issuance of common stock in
   connection with equity plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7,337

 

 

 

 

 

 

14

 

 

 

 

 

 

 

 

 

14

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5

 

 

 

 

 

 

5

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(9,216

)

 

 

(9,216

)

Balances, June 30, 2021

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

24,288,699

 

 

$

3

 

 

$

228,929

 

 

$

5

 

 

$

(61,386

)

 

$

167,551

 

 

The accompanying notes are an integral part of these consolidated financial statements.

6


 

RENEO PHARMACEUTICALS, INC.

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

Cash flows from operating activities

 

 

 

 

 

 

Net loss

 

$

(25,348

)

 

$

(16,428

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Stock-based compensation

 

 

2,113

 

 

 

1,325

 

Depreciation and amortization

 

 

41

 

 

 

20

 

Amortization/accretion on short-term investments

 

 

(22

)

 

 

33

 

Changes in the fair value of performance award

 

 

(389

)

 

 

363

 

Non-cash lease expense

 

 

241

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Prepaid expenses and other assets

 

 

905

 

 

 

(2,457

)

Accounts payable and accrued expenses

 

 

1,726

 

 

 

(1,164

)

Operating lease liabilities

 

 

(222

)

 

 

 

Other current and long-term liabilities

 

 

 

 

 

18

 

Net cash used in operating activities

 

 

(20,955

)

 

 

(18,290

)

Cash flows from investing activities

 

 

 

 

 

 

Purchases of property and equipment

 

 

(68

)

 

 

(31

)

Purchase of available-for-sale short-term investments

 

 

(15,922

)

 

 

(26,989

)

Proceeds from maturities of available-for-sale short-term investments

 

 

30,500

 

 

 

 

Net cash provided by (used in) investing activities

 

 

14,510

 

 

 

(27,020

)

Cash flows from financing activities

 

 

 

 

 

 

Proceeds from issuance of Series B convertible preferred stock, net of issuance costs

 

 

 

 

 

47,239

 

Proceeds from initial public offering, net of offering costs

 

 

 

 

 

84,639

 

Proceeds from issuance of common stock in connection with equity plans

 

 

49

 

 

 

187

 

Net cash provided by financing activities

 

 

49

 

 

 

132,065

 

Net (decrease) increase in cash and cash equivalents

 

 

(6,396

)

 

 

86,755

 

Cash and cash equivalents, beginning of period

 

 

124,660

 

 

 

53,613

 

Cash and cash equivalents, end of period

 

$

118,264

 

 

$

140,368

 

Noncash operating activities:

 

 

 

 

 

 

Right-of-use assets obtained in exchange for lease obligations

 

$

1,524

 

 

$

 

Noncash investing and financing activities:

 

 

 

 

 

 

Property and equipment in accounts payable