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 September 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 001-40360

Mind Medicine (MindMed) Inc.

(Exact name of Registrant as specified in its Charter)

British Columbia, Canada	98-1582538
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
One World Trade Center, Suite 8500 New York, New York	10007
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (650) 208-2454

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Shares, no par value per share	MNMD	The Nasdaq Stock Market LLC (The Nasdaq Capital Market)

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, 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	☐
Non-accelerated filer	☒	Smaller reporting company	☐
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 October 31, 2022, the registrant had 37,571,139 Common Shares outstanding.

Table of Contents

		Page
PART I	FINANCIAL INFORMATION	4
Item 1.	Financial Statements	4
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Operations and Comprehensive Loss	5
	Condensed Consolidated Statements of Shareholders' Equity	6
	Condensed Consolidated Statements of Cash Flows	8
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28
Item 4.	Controls and Procedures	28
PART II	OTHER INFORMATION	30
Item 1.	Legal Proceedings	30
Item 1A.	Risk Factors	30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	32
Item 3.	Defaults Upon Senior Securities	32
Item 4.	Mine Safety Disclosures	32
Item 5.	Other Information	32
Item 6.	Exhibits	35
Signatures		36

115405326v4

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our future results of operations or financial condition, business strategy and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will” or “would” or the negative of these words or other similar terms or expressions. These forward-looking statements include, but are not limited to, statements concerning the following:

•the timing, progress and results of our investigational MM-120 or a proprietary, pharmaceutically optimized form of lysergide ("LSD"), MM-402 or a R(-)-MDMA and MM-110 or zolunicant product candidates (together, our “lead product candidates”), including statements regarding the timing of initiation and completion of trials or studies and related preparatory work, the period during which the results of the trials will become available and our research and development programs;

•our reliance on the success of our investigational MM-120 or LSD product candidate;

•the timing, scope or likelihood of regulatory filings and approvals and ability to obtain and maintain regulatory approvals for product candidates for any indication;

•our expectations regarding the size of the eligible patient populations for our lead product candidates;

•our ability to identify third-party therapy sites to conduct our trials and our ability to identify and train appropriately qualified therapists to administer our treatments;

•our ability to implement our business model and our strategic plans for our product candidates;

•our ability to identify new indications for our lead product candidates beyond our current primary focuses;

•our ability to identify, develop or acquire digital technologies to enhance our administration of our product candidates;

•our ability to achieve profitability and then sustain such profitability;

•our commercialization, marketing and manufacturing capabilities and strategy;

•the pricing, coverage and reimbursement of our lead product candidates, if approved;

•the rate and degree of market acceptance and clinical utility of our lead product candidates, in particular, and controlled substances, in general;

•future investments in our business, our anticipated capital expenditures and our estimates regarding our capital requirements;

•our ability to establish or maintain collaborations or strategic relationships or obtain additional funding;

•our expectations regarding potential benefits of our investigational lead product candidates and our therapeutic approach generally;

•our ability to obtain and maintain effective patent rights and other intellectual property protection for our product candidates or any future product candidates, and to prevent competitors from using technologies we consider important in our successful development and commercialization of our product candidates;

•infringement or alleged infringement on the intellectual properly rights of third parties;

•regulatory developments in the United States, under the laws and regulations of England and Wales, and other jurisdictions;

•the effectiveness of our internal control over financial reporting;

•the effect of the ongoing and evolving COVID-19 pandemic, including mitigation efforts and economic effects, on any of the foregoing or other aspects of our business or operations;

•our expectations regarding our revenue, expenses and other operating results;

115405326v4

•the costs and success of our marketing efforts, and our ability to promote our brand;

•our reliance on key personnel and our ability to identify, recruit and retain skilled personnel;

•our ability to effectively manage our growth; and

•our ability to compete effectively with existing competitors and new market entrants.

You should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition and operating results. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described in the section titled “Risk Factors” previously disclosed in Part I, Item 1A. in our Annual Report on Form 10-K, as filed with the SEC on March 28, 2022 (the "2021 Annual Report") and in Part II, Item 1A in this Quarterly Report on Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Quarterly Report on Form 10-Q. And while we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.

The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements made in this Quarterly Report on Form 10-Q to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments.

We may announce material business and financial information to our investors using our investor relations website (https://mindmed.co/investor-resources/). We therefore encourage investors and others interested in our company to review the information that we make available on our website. Our website and information included in or linked to our website are not part of this Quarterly Report on Form 10-Q.

115405326v4

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

Mind Medicine (MindMed) Inc.

Condensed Consolidated Balance Sheets

(In thousands, except share amounts)

	September 30, 2022			December 31, 2021
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	154,519		$	133,539
Prepaid and other current assets		1,826			3,676
Right of use asset		165			—
Total current assets		156,510			137,215
Goodwill		19,918			19,918
Intangible assets, net		4,479			6,869
Total assets	$	180,907		$	164,002
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	824		$	4,178
Accrued expenses		7,467			6,230
2022 USD Financing Warrants		17,747			—
Total current liabilities		26,038			10,408
Other liabilities, long-term		1,276			1,930
Total liabilities		27,314			12,338
Commitments and contingencies (Note 11)
Shareholders' Equity:
Common shares, no par value, unlimited authorized as of September 30, 2022 and December 31, 2021; 37,541,115 and 28,126,414 issued and outstanding as of September 30, 2022 and December 31, 2021, respectively		—			—
Additional paid-in capital		342,415			288,290
Accumulated other comprehensive (loss)/income		743			1,046
Accumulated deficit		(189,565	)		(137,672	)
Total shareholders' equity		153,593			151,664
Total liabilities and shareholders' equity	$	180,907		$	164,002

See accompanying notes to unaudited condensed consolidated financial statements.

4

Mind Medicine (MindMed) Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

(In thousands, except share and per share amounts)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Operating expenses:
Research and development	$	7,772		$	9,019		$	27,339		$	23,906
General and administrative		9,211			8,208			25,092			52,390
Total operating expenses		16,983			17,227			52,431			76,296
Loss from operations		(16,983	)		(17,227	)		(52,431	)		(76,296	)
Other income/(expense):
Interest income/(expense), net		360			(64	)		443			(220	)
Foreign exchange gain/(loss), net		138			(40	)		94			94
Other income		—			135			1			215
Total other income		498			31			538			89
Loss before income taxes		(16,485	)		(17,196	)		(51,893	)		(76,207	)
Income taxes		—			—			—			—
Net loss		(16,485	)		(17,196	)		(51,893	)		(76,207	)
Other comprehensive gain/(loss):
(Loss)/gain on foreign currency translation		(107	)		(383	)		(303	)		380
Comprehensive loss	$	(16,592	)	$	(17,579	)	$	(52,196	)	$	(75,827	)
Net loss per common share, basic and diluted	$	(0.56	)	$	(0.61	)	$	(1.82	)	$	(2.81	)
Weighted-average common shares, basic and diluted		29,296,333			28,013,809			28,566,161			27,124,297

See accompanying notes to unaudited condensed consolidated financial statements.

5

Mind Medicine (MindMed) Inc.

Condensed Consolidated Statements of Shareholders’ Equity

(Unaudited)

(In thousands, except share amounts)

	Common Shares
	Shares		Amount		Additional Paid-In Capital			Accumulated OCI			Accumulated Deficit			Total
Balance, December 31, 2021		28,126,414	$	—	$	288,290		$	1,046		$	(137,672	)	$	151,664
Issuance of common shares and warrants net of share issuance costs		9,014,371		—		41,350			—			—			41,350
Exercise of warrants		76,021		—		708			—			—			708
Exercise of stock options		38,276		—		206			—			—			206
Settlement of restricted share unit awards		286,033		—		—			—			—			—
Withholding taxes paid on vested restricted share units		—		—		(407	)		—			—			(407	)
Stock-based compensation expense		—		—		12,268			—			—			12,268
Net loss and comprehensive loss		—		—		—			(303	)		(51,893	)		(52,196	)
Balance, September 30, 2022		37,541,115	$	—	$	342,415		$	743		$	(189,565	)	$	153,593
Balance, December 31, 2020		24,075,677	$	—	$	120,220		$	284		$	(44,636	)	$	75,868
Issuance of common shares for vested director compensation		119,016		—		190			—			—			190
Vesting of restricted stock units		117,079		—		—			—			—			—
Issuance of common shares and warrants net of share issuance costs		1,795,333		—		81,924			—			—			81,924
HealthMode acquisition		543,313		—		27,159			—			—			27,159
Exercise of warrants		533,645		—		11,185			—			—			11,185
Exercise of stock options		796,093		—		5,588			—			—			5,588
Share-based settlement payment		100,000		—		4,869			—			—			4,869
Stock-based compensation expense		—		—		33,315			—			—			33,315
Net loss and comprehensive loss		—		—		—			380			(76,207	)		(75,827	)
Balance, September 30, 2021		28,080,156	$	—	$	284,450		$	664		$	(120,843	)	$	164,271

See accompanying notes to unaudited condensed consolidated financial statements.

6

Mind Medicine (MindMed) Inc.

Condensed Consolidated Statements of Shareholders’ Equity

(Unaudited)

(In thousands, except share amounts)

	Common Shares
	Shares		Amount		Additional Paid-In Capital			Accumulated OCI			Accumulated Deficit			Total
Balance, June 30, 2022		28,445,948	$	—	$	296,734		$	850		$	(173,080	)	$	124,504
Issuance of common shares and warrants, net of issuance cost		9,014,371		—		41,350			—			—			41,350
Exercise of stock options		8,762		—		42			—			—			42
Settlement of restricted share unit awards		72,034		—		—			—			—			—
Stock-based compensation expense		—		—		4,289			—			—			4,289
Net loss and comprehensive loss		—		—		—			(107	)		(16,485	)		(16,592	)
Balance, September 30, 2022		37,541,115	$	—	$	342,415		$	743		$	(189,565	)	$	153,593
Balance, June 30, 2021		27,820,905	$	—	$	274,233		$	1,047		$	(103,647	)	$	171,633
Issuance of common shares for vested director compensation		36,024		—		57			—			—			57
Vesting of restricted stock units		972		—		—			—			—			—
Issuance of share capital net of share issuance costs		—		—		(4	)		—			—			(4	)
Exercise of warrants		48,033		—		509			—			—			509
Exercise of stock options		74,222		—		315			—			—			315
Share-based settlement payment		100,000		—		4,869			—			—			4,869
Stock-based compensation expense		—		—		4,471			—			—			4,471
Net loss and comprehensive loss		—		—		—			(383	)		(17,196	)