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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
10-Q
(Mark One)
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☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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For the quarterly period ended
September 30,
2022
OR
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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For the transition period from _________________ to
_________________
Commission File Number:
001-39311
CEREVEL THERAPEUTICS HOLDINGS, INC.
(Exact Name of Registrant as Specified in its Charter)
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Delaware
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85-3911080
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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222 Jacobs Street,
Suite 200
Cambridge,
MA
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02141
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code:
(844)
304-2048
Securities registered pursuant to Section 12(b) of the
Act:
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Title of each class
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Trading
Symbol(s)
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Name of each exchange on which registered
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Common stock, par value $0.0001 per share
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CERE
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The NASDAQ Stock Market LLC
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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.
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Large accelerated filer
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☒
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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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 28, 2022, the registrant had
156,322,552
shares
of common stock, par value $0.0001 per share,
outstanding.
Table of Contents
i
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements in this Quarterly Report on Form 10-Q, or this
Quarterly Report, may constitute “forward-looking statements” for
purposes of the federal securities laws. Our forward-looking
statements include, but are not limited to, statements regarding
our or our management team’s expectations, hopes, beliefs,
intentions or strategies regarding the future. In addition, any
statements that refer to projections, forecasts or other
characterizations of future events or circumstances, including any
underlying assumptions, are forward-looking statements. The words
“anticipate,” “believe,” “contemplate,” “continue,” “could,”
“estimate,” “expect,” “intends,” “may,” “might,” “plan,”
“possible,” “potential,” “predict,” “project,” “should,” “will,”
“would,” “can,” “target,” “future” or the negative of these terms
or other similar expressions may identify forward-looking
statements, but the absence of these words does not mean that a
statement is not forward-looking. Forward-looking statements in
this Quarterly Report may include, for example, statements
about:
•
the format, likelihood of success, cost and timing of our clinical
trials and other product development activities, including the
design of clinical trials and preclinical studies, the timing of
initiation and completion of clinical trials and related
preparatory work, our ability to collect and interpret clinical
trial data and the timing and outcome of regulatory
interactions;
•
our ability to recruit and enroll suitable patients in our clinical
trials;
•
the potential attributes and benefits of our product
candidates;
•
our ability to obtain and maintain regulatory approval for our
product candidates, and any related restrictions, limitations or
warnings on the label of an approved product
candidate;
•
our ability to obtain funding for our operations, including funding
necessary to complete further development, approval and, if
approved, commercialization of our product candidates;
•
the period over which we anticipate our available financial
resources will enable us to fund our operating expense and capital
expenditure requirements;
•
the potential for our business development efforts to maximize the
potential value of our portfolio;
•
our ability to identify, in-license or acquire additional product
candidates;
•
our ability to maintain our license agreement with
Pfizer;
•
our ability to compete with other companies currently marketing or
engaged in the development of treatments for the indications that
we are pursuing for our product candidates;
•
our ability to obtain and maintain intellectual property protection
for our product candidates and the duration of such
protection;
•
our ability to contract with and rely on third parties to assist in
conducting our clinical trials and manufacturing our product
candidates;
•
the size and growth potential of the markets for our product
candidates, and our ability to serve those markets, either alone or
in partnership with others;
•
the rate and degree of market acceptance of our product candidates,
if approved;
•
the pricing and reimbursement of our product candidates, if
approved;
•
regulatory developments in the United States and foreign
countries;
•
the impact of laws, regulations, accounting standards, regulatory
requirements, judicial decisions and guidance issued by
authoritative bodies;
•
our ability to attract and retain key scientific, medical,
commercial or management personnel;
•
our estimates regarding expenses, future revenue, capital
requirements and needs for additional financing;
•
our future financial performance;
•
our ability to recognize the anticipated benefits of the tavapadon
financing transaction (including our ability to receive future
payments thereunder) and other financing and business development
transactions;
•
our ability to satisfy our payment obligations, remain in
compliance with covenants under the 2027 Notes (as defined below),
to service the interest on or to refinance the 2027 Notes or to
make cash payments in connection with any conversion of the 2027
Notes, to the extent required; and
•
the effect of the ongoing COVID-19 pandemic, or any other health
epidemic, including as a result of the emergence of new variants or
subvariants, mitigation efforts and economic effects, on any of the
foregoing or other aspects of our business operations, including
but not limited to our clinical trials and other product
development activities, healthcare systems and the global economy
as a whole.
ii
The forward-looking statements contained in this Quarterly Report
are based on current expectations and beliefs concerning future
developments and their potential effects on us. There can be no
assurance that future developments affecting us will be those that
we have anticipated. These forward-looking statements involve a
number of risks, uncertainties (some of which are beyond our
control) or other assumptions that may cause actual results or
performance to be materially different from those expressed or
implied by these forward-looking statements. These risks and
uncertainties include, but are not limited to, those factors
described in the section titled “Risk
Factors”
of this Quarterly Report. Should one or more of these risks or
uncertainties materialize, or should any of our assumptions prove
incorrect, actual results may vary in material respects from those
projected in these forward-looking statements. Some of these risks
and uncertainties may in the future be amplified by the ongoing
COVID-19 pandemic, including as a result of the emergence of new
variants or subvariants, and there may be additional risks that we
consider immaterial, or which are unknown. It is not possible to
predict or identify all such risks. We do not undertake any
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as may be required under applicable securities
laws.
You should read this Quarterly Report completely and with the
understanding that our actual future results may be materially
different from what we expect. We qualify all of our
forward-looking statements by these cautionary
statements.
This Quarterly Report contains summaries of certain provisions
contained in some of the documents described herein, but reference
is made to the actual documents for complete information. All of
the summaries are qualified in their entirety by the actual
documents. Copies of some of the documents referred to herein have
been filed as exhibits to this Quarterly Report. Unless the context
otherwise requires, reference in this Quarterly Report to the terms
“Cerevel,” “the Company,” “we,” “us,” “our,” and similar
designations refer to Cerevel Therapeutics Holdings, Inc. and,
where appropriate, our consolidated subsidiaries.
We may from time to time provide estimates, projections and other
information concerning our industry, the general business
environment, and the markets for certain diseases, including
estimates regarding the potential size of those markets and the
estimated incidence and prevalence of certain medical conditions.
Information that is based on estimates, forecasts, projections,
market research or similar methodologies is inherently subject to
uncertainties, and actual events, circumstances or numbers,
including actual disease prevalence rates and market size, may
differ materially from the information reflected in this Quarterly
Report. Unless otherwise expressly stated, we obtained the
industry, market and competitive position data from our internal
estimates and research, as well as from independent market
research, industry and general publications and surveys,
governmental agencies and publicly available information in
addition to research, surveys and studies conducted by third
parties that have not been independently verified which may, in the
future, prove not to have been accurate.
SUMMARY OF MATERIAL RISKS ASSOCIATED WITH OUR BUSINESS
Our business is subject to numerous risks and uncertainties that
you should be aware of before making an investment decision,
including those highlighted in the section entitled
“Risk
Factors.”
These risks include, but are not limited to, the
following:
•
The successful development of pharmaceutical products is highly
uncertain.
•
We are a clinical-stage biopharmaceutical company with a limited
operating history. We have incurred significant financial losses
since our inception and anticipate that we will continue to incur
significant financial losses for the foreseeable
future.
•
We will need substantial additional funding, and if we are unable
to raise capital when needed, we could be forced to delay, reduce
or terminate our product discovery and development programs or
commercialization efforts.
•
Due to the significant resources required for the development of
our pipeline, and depending on our ability to access capital, we
must prioritize the development of certain product candidates over
others. Moreover, we may fail to expend our limited resources on
product candidates or indications that may have been more
profitable or for which there is a greater likelihood of
success.
•
Our business is highly dependent on the success of our product
candidates. If we are unable to successfully complete clinical
development, obtain regulatory approval for or commercialize one or
more of our product candidates, or if we experience delays in doing
so, our business will be materially harmed.
•
The regulatory approval processes of the U.S. Food and Drug
Administration, or the FDA, and comparable foreign authorities are
lengthy, time-consuming and inherently unpredictable, and if we are
ultimately unable to obtain regulatory approval for our product
candidates, our business will be substantially harmed.
•
Business interruptions resulting from the ongoing COVID-19 pandemic
or similar public health crises could cause a disruption of the
development of our product candidates and adversely impact our
business.
•
If our clinical trials fail to replicate positive results from
earlier preclinical studies or clinical trials conducted by us or
third parties, we may be unable to successfully develop, obtain
regulatory approval for or commercialize our product
candidates.
iii
•
We may incur unexpected costs or experience delays in completing,
or ultimately be unable to complete, the development and
commercialization of our product candidates.
•
If we encounter difficulties enrolling patients in our clinical
trials, our clinical development activities could be delayed or
otherwise adversely affected.
•
Even if any of our product candidates receives regulatory approval,
it may fail to achieve the degree of market acceptance by
physicians, patients, third-party payors and others in the medical
community necessary for commercial success, in which case we may
not generate significant revenues or become
profitable.
•
Competitive products may reduce or eliminate the commercial
opportunity for our product candidates, if approved. If our
competitors develop technologies or product candidates more rapidly
than we do, or their technologies or product candidates are more
effective or safer than ours, our ability to develop and
successfully commercialize our product candidates may be adversely
affected.
•
We depend heavily on our executive officers, third-party
consultants and others and our ability to compete in the
biotechnology and pharmaceutical industries depends upon our
ability to attract and retain highly qualified managerial,
scientific and medical personnel. The loss of their services or our
inability to hire and retain such personnel would materially harm
our business.
•
BC Perception Holdings, LP, or Bain Investor, and Pfizer Inc., or
Pfizer, have significant influence over us.
•
We rely on third parties to assist in conducting our clinical
trials. If they do not perform satisfactorily, we may not be able
to obtain regulatory approval or commercialize our product
candidates, or such approval or commercialization may be delayed,
and our business could be substantially harmed.
•
We depend and expect in the future to continue to depend on
in-licensed intellectual property. Such licenses impose obligations
on our business, and if we fail to comply with those obligations,
we could lose license rights, which would substantially harm our
business.
The risks described above should be read together with the text of
the full risk factors discussed in the section entitled
“Risk
Factors”
and the other information set forth in this Quarterly Report,
including our condensed consolidated financial statements and the
related notes, as well as in other documents that we file with the
Securities and Exchange Commission, or the SEC. The risks
summarized above or described in full elsewhere in this Quarterly
Report are not the only risks that we face. Additional risks and
uncertainties not presently known to us, or that we currently deem
to be immaterial may also materially adversely affect our business,
financial condition, results of operations and future growth
prospects.
iv
PART I—FINANCIAL
INFORMATION
Item 1. Financial
Statements.
CEREVEL THERAPEUTICS HOLDINGS, INC.
CONDENSED CONSOLIDATED
BALANCE SHEETS
(In thousands, except share amounts and per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
As of
|
|
|
|
|
September 30,
2022
|
|
|
December 31,
2021
|
|
|
ASSETS
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
248,600
|
|
|
$
|
193,018
|
|
|
Marketable securities
|
|
|
741,318
|
|
|
|
372,670
|
|
|
Prepaid expenses and other current assets
|
|
|
8,740
|
|
|
|
12,329
|
|
|
Total current assets
|
|
|
998,658
|
|
|
|
578,017
|
|
|
Marketable securities
|
|
|
39,863
|
|
|
|
52,269
|
|
|
Property and equipment, net
|
|
|
28,323
|
|
|
|
28,449
|
|
|
Operating lease assets
|
|
|
22,204
|
|
|
|
23,251
|
|
|
Restricted cash
|
|
|
1,867
|
|
|
|
4,200
|
|
|
Other long-term assets
|
|
|
2,797
|
|
|
|
2,733
|
|
|
Total assets
|
|
$
|
1,093,712
|
|
|
$
|
688,919
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
14,971
|
|
|
$
|
11,298
|
|
|
Accrued expenses and other current liabilities
|
|
|
42,264
|
|
|
|
28,803
|
|
|
Operating lease liabilities, current portion
|
|
|
2,785
|
|
|
|
2,437
|
|
|
Total current liabilities
|
|
|
60,020
|
|
|
|
42,538
|
|
|
Operating lease liabilities, net of current portion
|
|
|
31,948
|
|
|
|
34,110
|
|
|
Financing liability, related party (Notes 5 and 7)
|
|
|
31,687
|
|
|
|
16,770
|
|
|
Financing liability (Notes 5 and 7)
|
|
|
31,687
|
|
|
|
16,770
|
|
|
2027 convertible senior notes, net (Note 6)
|
|
|
335,006
|
|
|
|
—
|
|
|
Other long-term liabilities
|
|
|
2
|
|
|
|
2
|
|
|
Total liabilities
|
|
|
490,350
|
|
|
|
110,190
|
|
|
Commitments and contingencies (Notes 13 and
14)
|
|
|
|
|
|
|
|
Stockholders’ equity:
|
|
|
|
|
|
|
|
Preferred stock, $0.0001 par
value:
10,000,000 shares
authorized;
no shares
issued and outstanding as of September 30, 2022 and
December 31, 2021
|
|
|
—
|
|
|
|
—
|
|
|
Common stock, $0.0001 par
value:
500,000,000 shares
authorized;
156,243,808 and
147,719,523 shares
issued and outstanding
as of September 30, 2022 and December 31,
2021, respectively
|
|
|
16
|
|
|
|
15
|
|
|
Additional paid-in capital
|
|
|
1,473,099
|
|
|
|
1,195,944
|
|
|
Accumulated other comprehensive income (loss)
|
|
|
5,194
|
|
|
|
(986
|
)
|
|
Accumulated deficit
|
|
|
(874,947
|
)
|
|
|
(616,244
|
)
|
|
Total stockholders’ equity
|
|
|
603,362
|
|
|
|
578,729
|
|
|
Total liabilities and stockholders’ equity
|
|
$
|
1,093,712
|
|
|
$
|
688,919
|
|
The accompanying notes are an integral part of these unaudited
condensed consolidated financial statements.
5
CEREVEL THERAPEUTICS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except share amounts and per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended
September 30,
|
|
|
For the Nine Months Ended
September 30,
|
|
|
|
|
2022
|
|
|
2021
|
|
|
2022
|
|
|
2021
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
$
|
71,385
|
|
|
$
|
40,159
|
|
|
$
|
198,947
|
|
|
$
|
114,014
|
|
|
General and administrative
|
|
|
23,680
|
|
|
|
14,368
|
|
|
|
61,654
|
|
|
|
41,594
|
|
|
Total operating expenses
|
|
|
95,065
|
|
|
|
54,527
|
|
|
|
260,601
|
|
|
|
155,608
|
|
|
Loss from operations
|
|
|
(95,065
|
)
|
|
|
(54,527
|
)
|
|
|
(260,601
|
)
|
|
|
(155,608
|
)
|
|
Interest income (expense), net
|
|
|
2,706
|
|
|
|
13
|
|
|
|
3,668
|
|
|
|
38
|
|
|
Other income (expense), net
|
|
|
(7,579
|
)
|
|
|
(7,545
|
)
|
|
|
(1,770
|
)
|
|
|
(10,709
|
)
|
|
Loss before income taxes
|
|
|
(99,938
|
)
|
|
|
(62,059
|
)
|
|
|
(258,703
|
)
|
|
|
(166,279
|
)
|
|
Income tax benefit (provision), net
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Net loss
|
|
$
|
(99,938
|
)
|
|
$
|
(62,059
|
)
|
|
$
|
(258,703
|
)
|
|
$
|
(166,279
|
)
|
|
Net loss per share, basic and diluted
|
|
$
|
(0.66
|
)
|
|
$
|
(0.43
|
)
|
|
$
|
(1.73
|
)
|
|
$
|
(1.25
|
)
|
|
Weighted-average shares used in calculating net loss per share,
basic and diluted
|
|
|
152,304,645
|
|
|
|
144,022,109
|
|
|
|
149,544,252
|
|
|
|
132,971,450
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(99,938
|
)
|
|
$
|
(62,059
|
)
|
|
$
|
(258,703
|
)
|
|
$
|
(166,279
|
)
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in fair value attributable to instrument-specific credit
risk
|
|
|
(1,364
|
)
|
|
|
(533
|
)
|
|
|
9,466
|
|
|
|
(533
|
)
|
|
Unrealized gains (losses) on securities
available-for-sale
|
|
|
(1,430
|
)
|
|
|
—
|
|
|
|
(3,286
|
)
|
|
|
—
|
|
|
Total other comprehensive income (loss)
|
|
|
(2,794
|
)
|
|
|
(533
|
)
|
|
|
6,180
|
|
|
|
(533
|
)
|
|
Comprehensive loss
|
|
$
|
(102,732
|
)
|
|
$
|
(62,592
|
)
|
|
$
|
(252,523
|
)
|
|
$
|
(166,812
|
)
|
The accompanying notes are an integral part of these unaudited
condensed consolidated financial statements.
6
CEREVEL THERAPEUTICS HOLDINGS, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands, except share amounts)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
Additional
paid-in
|
|
|
Accumulated other
comprehensive
|
|
|
Accumulated
|
|
|
Total
stockholders’
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
capital
|
|
|
income (loss)
|
|
|
deficit
|
|
|
equity
|
|
|
Balance at December 31, 2021
|
|
|
147,719,523
|
|
|
$
|
15
|
|
|
$
|
1,195,944
|
|
|
$
|
(986
|
)
|
|
$
|
(616,244
|
)
|
|
$
|
578,729
|
|
|
Issuance of common stock under equity incentive plans related to
vesting of RSUs
|
|
|
14,270
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Issuance of common stock under equity incentive plans related to
exercise of options
|
|
|
449,005
|
|
|
|
—
|
|
|
|
2,854
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,854
|
|
|
Equity-based compensation expense
|
|
|
—
|
|
|
|
—
|
|
|
|
8,558
|
|
|
|
—
|
|
|
|
—
|
|
|
|
8,558
|
|
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(348
|
)
|
|
|
—
|
|
|
|
(348
|
)
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(68,294
|
)
|
|
|
(68,294
|
)
|
|
Balance at March 31, 2022
|
|
|
148,182,798
|
|
|
$
|
15
|
|
|
$
|
1,207,356
|
|
|
$
|
(1,334
|
)
|
|
$
|
(684,538
|
)
|
|
$
|
521,499
|
|
|
Issuance of common stock under equity incentive plans related to
vesting of RSUs
|
|
|
14,270
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Issuance of common stock under equity incentive plans related to
exercise of options
|
|
|
160,623
|
|
|
|
—
|
|
|
|
1,471
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,471
|
|
|
Issuance of common stock under equity incentive plans related to
ESPP
|
|
|
37,591
|
|
|
|
—
|
|
|
|
845
|
|
|
|
—
|
|
|
|
—
|
|
|
|
845
|
|
|
Equity-based compensation expense
|
|
|
—
|
|
|
|
—
|
|
|
|
10,148
|
|
|
|
—
|
|
|
|
—
|
|
|
|
10,148
|
|
|
Other comprehensive income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,322
|
|
|
|
—
|
|
|
|
9,322
|
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(90,471
|
)
|
|
|
(90,471
|
)
|
|
Balance at June 30, 2022
|
|
|
148,395,282
|
|
|
$
|
15
|
|
|
$
|
1,219,820
|
|
|
$
|
7,988
|
|
|
$
|
(775,009
|
)
|
|
$
|
452,814
|
|
|
Issuance of common stock related to follow-on offering, net of
offering costs (Note 9)
|
|
|
7,250,000
|
|
|
|
1
|
|
|
|
238,099
|
|
|
|
—
|
|
|
|
—
|
|
|
|
238,100
|
|
|
Issuance of common stock under equity incentive plans related to
exercise of options
|
|
|
598,526
|
|
|
|
—
|
|
|
|
5,484
|
|
|
|
—
|
|
|
|
—
|
|
|
|
5,484
|
|
|
Equity-based compensation expense
|
|
|
—
|
|
|
|
—
|
|
|
|
9,696
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,696
|
|
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2,794
|
)
|
|
|
—
|
|
|
|
(2,794
|
)
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(99,938
|
)
|
|
|
(99,938
|
)
|
|
Balance at September 30, 2022
|
|
|
156,243,808
|
|
|
$
|
16
|
|
|
$
|
1,473,099
|
|
|
$
|
5,194
|
|
|
$
|
(874,947
|
)
|
|
$
|
603,362
|
|
The accompanying notes are an integral part of these unaudited
condensed consolidated financial statements.
7
CEREVEL THERAPEUTICS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’
EQUITY
(In thousands, except share amounts)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
Additional
paid-in
|
|
|
Accumulated other
comprehensive
|
|
|
Accumulated
|
|
|
Total
stockholders’
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
capital
|
|
|
loss
|
|
|
deficit
|
|
|
equity
|
|
|
Balance at December 31, 2020
|
|
|
127,123,954
|
|
|
$
|
13
|
|
|
$
|
775,417
|
|
|
$
|
—
|
|
|
$
|
(390,910
|
)
|
|
$
|
384,520
|
|
|
Issuance of common stock under equity incentive plans related to
vesting of RSUs
|
|
|
14,270
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Issuance of common stock under equity incentive plans related to
exercise of options
|
|
|
186,892
|
|
|
|
—
|
|
|
|
742
|
|
|
|
—
|
|
|
|
—
|
|
|
|
742
|
|
|
Reclassification of private placement warrants from equity to other
long-term liabilities
|
|
|
—
|
|
|
|
—
|
|
|
|
(305
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(305
|
)
|
|
Equity-based compensation expense
|
|
|
—
|
|
|
|
—
|
|
|
|
6,060
|
|
|
|
—
|
|
|
|
—
|
|
|
|
6,060
|
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(50,981
|
)
|
|
|
(50,981
|
)
|
|
Balance at March 31, 2021
|
|
|
127,325,116
|
|
|
$
|
13
|
|
|
$
|
781,914
|
|
|
$
|
—
|
|
|
$
|
(441,891
|
)
|
|
$
|
340,036
|
|
|
Issuance of common stock under equity incentive plans related to
vesting of RSUs
|
|
|
14,270
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Issuance of common stock under equity incentive plans related to
exercise of options
|
|
|
204,684
|
|
|
|
—
|
|
|
|
1,394
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,394
|
|
|
Issuance of common stock under equity incentive plans related to
ESPP
|
|
|
40,589
|
|
|
|
—
|
|
|
|
435
|
|
|
|
—
|
|
|
|
—
|
|
|
|
435
|
|
|
Equity-based compensation expense
|
|
|
—
|
|
|
|
—
|
|
|
|
5,261
|
|
|
|
—
|
|
|
|
—
|
|
|
|
5,261
|
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(53,239
|
)
|
|
|
(53,239
|
)
|
|
Balance at June 30, 2021
|
|
|
127,584,659
|
|
|
$
|
13
|
|
|
$
|
789,004
|
|
|
$
|
—
|
|
|
$
|
(495,130
|
)
|
|
$
|
293,887
|
|
|
Issuance of common stock related to follow-on offering, net of
offering costs (Note 9)
|
|
|
14,000,000
|
|
|
|
1
|
|
|
|
328,250
|
|
|
|
—
|
|
|
|
—
|
|
|
|
328,251
|
|
|
Issuance of common stock related to exercise of public
warrants
|
|
|
4,822,947
|
|
|
|
1
|
|
|
|
55,462
|
|
|
|
—
|
|
|
|
—
|
|
|
|
55,463
|
|
|
Issuance of common stock related to cashless exercise of private
placement warrants
|
|
|
111,426
|
|
|
|
—
|
|
|
|
4,186
|
|
|
|
—
|
|
|
|
—
|
|
|
|
4,186
|
|
|
Issuance of common stock under equity incentive plans related to
vesting of RSUs
|
|
|
14,270
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
Issuance of common stock under equity incentive plans related to
exercise of options
|
|
|
602,666
|
|
|
|
—
|
|
|
|
3,751
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,751
|
|
|
Equity-based compensation expense
|
|
|
—
|
|
|
|
—
|
|
|
|
6,134
|
|
|
|
—
|
|
|
|
—
|
|
|
|
6,134
|
|
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(533
|
)
|
|
|
—
|
|
|
|
(533
|
)
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(62,059
|
)
|
|
|
(62,059
|
)
|
|
Balance at September 30, 2021
|
|
|
147,135,968
|
|
|
$
|
15
|
|
|
$
|
1,186,787
|
|
|
$
|
(533
|
)
|
|
$
|
(557,189
|
)
|
|
$
|
629,080
|
|
The accompanying notes are an integral part of these unaudited
condensed consolidated financial statements.
8
CEREVEL THERAPEUTICS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS
(In thousands)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
For the Nine Months Ended
September 30,
|
|
|
|
|
2022
|
|
|
2021
|
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(258,703
|
)
|
|
$
|
(166,279
|
)
|
|
Adjustments to reconcile net loss to net cash flows used in
operating activities:
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
3,608
|
|
|
|
1,644
|
|
|
Adjustments to operating lease expense
|
|
|
(753
|
)
|
|
|
(615
|
)
|
|
Equity-based compensation
|
|
|
28,402
|
|
|
|
17,455
|
|
|
Change in fair value of financing liabilities
|
|
|
1,800
|
|
|
|
6,830
|
|
|
Change in fair value of private placement warrants
|
|
|
—
|
|
|
|
3,881
|
|
|
Non-cash interest expense
|
|
|
232
|
|
|
|
—
|
|
|
Amortization of premiums and accretion of discounts on marketable
securities
|
|
|
(926
|
)
|
|
|
—
|
|
|
Changes in operating assets and liabilities, net:
|
|
|
|
|
|
|
|
Prepaid expenses and other current assets
|
|
|
3,546
|
|
|
|
1,672
|
|
|
Other assets
|
|
|
(456
|
)
|
|
|
(665
|
)
|
|
Accounts payable
|
|
|
4,237
|
|
|
|
1,874
|
|
|
Accrued expenses and other liabilities
|
|
|
13,304
|
|
|
|
2,806
|
|
|
Operating lease liability
|
|
|
—
|
|
|
|
5,595
|
|
|
Net cash flows used in operating activities
|
|
|
(205,709
|
)
|
|
|
(125,802
|
)
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
Purchases of marketable securities
|
|
|
(713,249
|
)
|
|
|
—
|
|
|
Maturities and redemptions of marketable securities
|
|
|
354,647
|
|
|
|
—
|
|
|
Purchases of property and equipment
|
|
|
(3,500
|
)
|
|
|
(9,431
|
)
|
|
Net cash flows used in investing activities
|
|
|
(362,102
|
)
|
|
|
(9,431
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock related to follow-on
offering, net of offering costs
|
|
|
238,320
|
|
|
|
328,251
|
|
|
Proceeds from the exercise of public warrants
|
|
|
—
|
|
|
|
55,463
|
|
|
Proceeds from the exercise of stock options and ESPP
purchases
|
|
|
10,654
|
|
|
|
6,322
|
|
|
Proceeds from financing liability, related party
|
|
|
18,750
|
|
|
|
15,625
|
|
|
Proceeds from financing liability
|
|
|
18,750
|
|
|
|
15,625
|
|
|
Proceeds from issuance of 2027 convertible senior notes, net of
offering costs
|
|
|
334,837
|
|
|
|
—
|
|
|
Deferred costs related to financing activities
|
|
|
(251
|
)
|
|
|
—
|
|
|
Net cash flows provided by financing activities
|
|
|
621,060
|
|
|
|
421,286
|
|
|
Net increase in cash, cash equivalents and restricted
cash
|
|
|
53,249
|
|
|
|
286,053
|
|
|
Cash, cash equivalents and restricted cash, beginning of the
period
|
|
|
197,218
|
|
|
|
387,823
|
|
|
Cash, cash equivalents and restricted cash, end of the
period
|
|
$
|
250,467
|
|
|
$
|
673,876
|
|
|
Reconciliation of cash, cash equivalents and restricted
cash:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
248,600
|
|
|
$
|
669,676
|
|
|
Restricted cash
|
|
|
1,867
|
|
|
|
4,200
|
|
|
Total cash, cash equivalents and restricted cash
|
|
$
|
250,467
|
|
|
$
|
673,876
|
|
|
Supplemental cash flow disclosures from non-cash investing and
financing activities:
|
|
|
|
|
|
|
|
Fixed asset additions included in accounts payable and other
current liabilities
|
|
$
|
405
|
|
|
$
|
753
|
|
|
Offering costs included in accounts payable and other current
liabilities
|
|
$
|
125
|
|
|
$
|
—
|
|
|
Cashless exercise of private placement warrants
|
|
$
|
—
|
|
|
$
|
4,186
|
|
|
Reclassification of deferred financing costs to additional paid-in
capital
|
|
$
|
158
|
|
|
$
|
—
|
|
The accompanying notes are an integral part of these unaudited
condensed consolidated financial statements.
9
CEREVEL THERAPEUTICS HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
(Unaudited)
1. Nature of Operations
Unless the context otherwise requires, references in these notes to
“Cerevel,” “the company,” “we,” “us” and “our” and any related
terms are intended to mean Cerevel Therapeutics Holdings, Inc. and
its consolidated subsidiaries.
We are a clinical-stage biopharmaceutical company pursuing a
targeted approach to neuroscience that combines a deep
understanding of disease-related biology and neurocircuitry of the
brain with advanced chemistry and central nervous system (CNS)
target receptor selective pharmacology to discover and design new
therapies. We seek to transform the lives of patients through the
development of new therapies for neuroscience diseases, including
schizophrenia, epilepsy and Parkinson’s disease. We are advancing
our extensive and diverse pipeline with numerous clinical trials
underway or planned, including three ongoing Phase 3 trials and an
open-label extension trial for tavapadon in Parkinson's, two
ongoing Phase 2 trials and an open-label extension trial for
emraclidine in schizophrenia and an ongoing Phase 2
proof-of-concept trial and an open-label extension trial for
darigabat in focal epilepsy. We have built a highly experienced
team of senior leaders and neuroscience drug developers who combine
a nimble, results-driven biotech mindset with the proven expertise
of large pharmaceutical company experience and capabilities in drug
discovery and development.
Our portfolio of product candidates is based on a differentiated
approach to addressing neuroscience diseases, which incorporates
three key pillars: (1) targeted neurocircuitry, where we seek to
unlock new treatment opportunities by precisely identifying and
targeting the neurocircuit that underlies a given neuroscience
disease, (2) targeted receptor subtype selectivity, where we
selectively target the receptor subtype(s) related to the disease
physiology to minimize undesirable off-target effects while
maximizing activity and (3) differentiated pharmacology, where we
design full and partial agonists, antagonists and allosteric
modulators to precisely fine-tune the receptor pharmacology and
neurocircuit activity to avoid over-activation or over-suppression
of the endogenous physiologic range. In addition, our portfolio is
supported by robust data packages and rigorous clinical trial
execution designed to elucidate the key points of differentiation
for our compounds. We believe that this science-driven approach is
critical to achieving optimal therapeutic activity while minimizing
unintended side effects of currently available
therapies.
For additional information on our formation, please read Note
1,
Nature of Operations,
to our audited consolidated financial statements included in our
Annual Report on Form 10-K for the year ended December 31, 2021
(our Annual Report).
2. Risks and Liquidity
We are subject to risks and uncertainties common to clinical-stage
companies in the biopharmaceutical industry. These risks include,
but are not limited to, the introduction of new products,
therapies, standards of care or new technological innovations, our
ability to obtain and maintain adequate protection for our
in-licensed technology, data or other intellectual property and
proprietary rights and compliance with extensive government
regulation and oversight. In addition, we are dependent upon the
services of our employees, including key personnel, consultants,
third-party contract research organizations and other third-party
organizations.
Our product candidates, currently under development or that we may
develop, will require significant additional research and
development efforts, including extensive clinical testing and
regulatory approval prior to commercialization. These efforts
require significant amounts of additional capital, adequate
personnel infrastructure and extensive compliance and reporting
capabilities. There can be no assurance that our research and
development activities will be successfully completed, that
adequate protection for our licensed or developed technology will
be obtained and maintained, that products developed will obtain
necessary government regulatory approval or that any approved
products will be commercially viable.
Our unaudited condensed consolidated financial statements have been
prepared on the basis of continuity of operations, the realization
of assets and the satisfaction of liabilities in the ordinary
course of business. We have incurred significant operating losses
since our inception and, as of September 30, 2022, had an
accumulated deficit of
$874.9
million
and had not yet generated revenues. In addition, we anticipate that
our expenses will increase significantly in connection with our
ongoing activities to support our research, discovery and clinical
development efforts and we expect to continue to incur significant
expenses and operating losses for the foreseeable
future.