UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
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:
(Exact Name of Registrant as Specified in its Charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer |
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(Address of principal executive offices) |
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Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
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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.
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).
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 |
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Accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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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 May 4, 2022, the registrant had
Table of Contents
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PART I. |
1 |
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Item 1. |
1 |
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1 |
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Condensed Consolidated Statements of Operations and Comprehensive Loss |
2 |
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Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) |
3 |
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4 |
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Notes to Unaudited Condensed Consolidated Financial Statements |
6 |
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
24 |
Item 3. |
33 |
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Item 4. |
33 |
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PART II. |
35 |
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Item 1. |
35 |
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Item 1A. |
35 |
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Item 2. |
35 |
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Item 6. |
36 |
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37 |
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i
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements.
CARIBOU BIOSCIENCES, INC. AND ITS SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands, except share and per share amounts)
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March 31, |
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December 31, |
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2022 |
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2021 |
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ASSETS |
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CURRENT ASSETS |
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Cash and cash equivalents |
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$ |
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$ |
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Marketable securities, short-term |
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Accounts receivable |
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Contract assets |
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Other receivables |
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Prepaid expenses and other current assets |
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Total current assets |
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NON-CURRENT ASSETS |
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Investments in equity securities |
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Marketable securities, long-term |
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Property and equipment - net |
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Operating lease, right of use asset |
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Other assets |
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TOTAL ASSETS |
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$ |
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$ |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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CURRENT LIABILITIES |
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Accounts payable |
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$ |
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$ |
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Accrued expenses and other current liabilities |
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Lease liabilities |
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Deferred revenue |
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Total current liabilities |
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LONG-TERM LIABILITIES |
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Deferred revenue, net of current portion ($ |
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Deferred rent and lease incentive liability |
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MSKCC success payments liability |
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Lease liabilities, non-current |
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Other liabilities |
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Deferred tax liabilities |
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Total liabilities |
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(Note 9) |
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STOCKHOLDERS’ EQUITY |
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Preferred stock, par value $ |
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Common stock, par value $ |
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Additional paid-in-capital |
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Accumulated other comprehensive loss |
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( |
) |
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( |
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Accumulated deficit |
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( |
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( |
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Total stockholders’ equity |
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
1
CARIBOU BIOSCIENCES, INC. AND ITS SUBSIDIARIES
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(in thousands, except share and per share amounts)
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Three Months Ended March 31, |
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2022 |
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2021 |
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Licensing and collaboration revenue |
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$ |
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$ |
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Operating expenses: |
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Research and development |
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General and administrative |
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Total operating expenses |
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Loss from operations |
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( |
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( |
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Other income (expense): |
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Change in fair value of equity securities |
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( |
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— |
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Change in fair value of the MSKCC success payments liability |
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— |
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Other income - net |
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Total other income (expense) |
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Net loss |
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( |
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( |
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Other comprehensive loss: |
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Net unrealized loss on available-for-sale marketable securities, net of tax |
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( |
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— |
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Net comprehensive loss |
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$ |
( |
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$ |
( |
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Net loss per share, basic and diluted |
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$ |
( |
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$ |
( |
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Weighted-average common shares outstanding, basic and diluted |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
2
CARIBOU BIOSCIENCES, INC. AND ITS SUBSIDIARIES
Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit)
(Unaudited)
(in thousands, except share amounts)
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Convertible Preferred Stock |
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Common Stock |
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Additional Paid-In |
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Other Comprehensive |
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Retained Earnings (Accumulated |
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Total Stockholders’ Equity |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Income (Loss) |
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Deficit) |
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(Deficit) |
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BALANCE—December 31, 2021 |
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— |
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$ |
— |
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$ |
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$ |
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$ |
( |
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$ |
( |
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$ |
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
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— |
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— |
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Issuance of common stock under employee stock plans |
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— |
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— |
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— |
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— |
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— |
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Issuance of common stock on exercise of options |
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— |
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— |
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— |
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— |
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— |
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Net unrealized loss on available-for-sale marketable securities |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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— |
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( |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
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BALANCE—March 31, 2022 |
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— |
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$ |
— |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
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$ |
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BALANCE—December 31, 2020 |
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$ |
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$ |
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$ |
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$ |
— |
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$ |
( |
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$ |
( |
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Issuance of Series C convertible preferred stock, net of issuance costs of $ |
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— |
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— |
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— |
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— |
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— |
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— |
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Issuance of common stock on exercise of options |
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— |
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— |
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— |
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— |
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— |
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Stock-based compensation expense |
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— |
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— |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
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BALANCE—March 31, 2021 |
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$ |
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$ |
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$ |
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$ |
— |
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$ |
( |
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$ |
( |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
3
CARIBOU BIOSCIENCES, INC. AND ITS SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
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Three Months Ended March 31, |
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2022 |
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2021 |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net loss |
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$ |
( |
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$ |
( |
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Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
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Depreciation and amortization |
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Loss on disposal of fixed assets |
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Interest expense |
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Non-cash consideration for licensing and collaboration revenue |
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( |
) |
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Change in fair value of equity securities |
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Stock-based compensation expense |
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Change in fair value of MSKCC success payments liability |
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( |
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Amortization of investment premiums |
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Non-cash lease expense |
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Changes in operating assets and liabilities: |
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Accounts receivable |
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Contract assets |
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( |
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Other receivables |
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( |
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Prepaid expenses and other current assets |
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( |
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( |
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Other assets |
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( |
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( |
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Accounts payable |
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( |
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Accrued expenses and other current liabilities |
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( |
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Deferred revenue, current and long-term |
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( |
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Deferred rent and lease incentive liability |
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( |
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Operating lease liabilities |
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( |
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Other liabilities |
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( |
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( |
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Net cash provided by (used in) operating activities |
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( |
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CASH FLOWS FROM INVESTING ACTIVITIES: |
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Maturities of marketable securities |
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Purchases of property and equipment |
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( |
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( |
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Purchases of marketable securities |
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( |
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Net cash used in investing activities |
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( |
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( |
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CASH FLOWS FROM FINANCING ACTIVITIES: |
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Proceeds from issuance of Series C convertible preferred stock, net of issuance costs |
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Proceeds from exercise of stock options and purchases of common stock under employee stock purchase plan |
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Payments on capital lease |
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Net cash provided by financing activities |
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NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH |
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( |
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CASH, CASH EQUIVALENTS, AND RESTRICTED CASH — BEGINNING OF PERIOD |
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CASH, CASH EQUIVALENTS, AND RESTRICTED CASH — END OF PERIOD |
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$ |
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$ |
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RECONCILIATION OF CASH, CASH EQUIVALENTS, AND RESTRICTED CASH |
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Cash and cash equivalents |
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$ |
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$ |
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Restricted cash |
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CASH, CASH EQUIVALENTS, AND RESTRICTED CASH ON THE BALANCE SHEET |
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$ |
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$ |
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SUPPLEMENTAL CASH FLOW INFORMATION: |
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4
Cash paid for income taxes |
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$ |
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$ |
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Cash paid for interest |
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$ |
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$ |
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SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: |
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Acquisition of property and equipment included in accrued expenses and other current liabilities |
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$ |
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$ |
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Deferred issuance costs related to initial public offering unpaid at period end |
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$ |
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$ |
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Series C convertible preferred stock issuance costs unpaid at period end |
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$ |
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$ |
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Right-of-use-assets obtained in exchange for new operating lease liabilities |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
5
CARIBOU BIOSCIENCES, INC. AND ITS SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements
(Unaudited)
1. Description of the Business, Organization, and Liquidity
Business and Organization
Caribou Biosciences, Inc. (the “Company” or “we”) is a clinical-stage CRISPR genome-editing biopharmaceutical company dedicated to developing innovative, transformative therapies for patients with devastating diseases. CRISPR is an acronym for Clustered Regularly Interspaced Short Palindromic Repeats. Our novel CRISPR platform, CRISPR hybrid RNA-DNA (“chRDNA,” pronounced “chardonnay”), enables high genome-editing precision to develop cell therapies that are specifically engineered to target cancer and are armored for enhanced persistence. We are advancing a pipeline of allogeneic, or off-the-shelf, chimeric antigen receptor (“CAR”)-T (“CAR-T”) and CAR-natural killer (“CAR-NK”) cell therapies for the treatment of patients with hematologic malignancies and solid tumors.
We incorporated in October 2011 as a Delaware corporation and are headquartered in Berkeley, California. We have four wholly owned subsidiaries: Antler Holdco, LLC, incorporated in Delaware in April 2019; Microbe Holdco, LLC, incorporated in Delaware in June 2020; Arboreal Holdco, LLC, incorporated in Delaware in November 2020; and Biloba Holdco, LLC, incorporated in Delaware in April 2021. Our wholly owned subsidiaries hold interests in our equity investments and do not have operating activities.
Liquidity
We have incurred net losses and negative cash flows from operations since our inception and we had an accumulated deficit of $
2. Summary of Significant Accounting Policies
There have been no changes to the significant accounting policies disclosed in Note 2 to the annual consolidated financial statements for the year ended December 31, 2021 included in our Annual Report on Form 10-K (“Form 10-K”), other than changes to our leasing policy described below in connection with the adoption of the guidance under the Accounting Standards Codification (“ASC”) 842, Leases.
Basis of Presentation and Principles of Consolidation
The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and include the accounts of Caribou Biosciences, Inc. and its wholly owned subsidiaries. All intercompany accounts and transactions are eliminated in consolidation.
Use of Estimates
The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities; the disclosure of contingent assets and liabilities at the date of our condensed consolidated financial statements; and the reported amounts of revenue, income, and expenses during the applicable reporting period. On an ongoing basis, we evaluate our estimates and assumptions, including those related to revenue recognition, common stock valuation, stock-based compensation expense, accrued expenses related to research and development activities, valuation of the Memorial Sloan Kettering Cancer Center (“MSKCC”) success payments liability, and income taxes. Our management bases its estimates on historical experience and on various other assumptions that they believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from those estimates.
6
Segments
We operate and manage our business as
Concentrations of Credit Risk and Other Uncertainties
Financial instruments that potentially subject us to concentration of credit risk consist of cash and cash equivalents, accounts receivable, contract assets, other receivables, and investments in marketable securities and equity securities. Substantially all of our cash and cash equivalents are deposited in accounts at two financial institutions, and account balances may at times exceed federally insured limits. We mitigate the risks by investing in high-grade instruments, limiting our exposure to one issuer, and we monitor the ongoing creditworthiness of the financial institutions and issuers. We believe these financial institutions to be of high credit quality.
Licensees that represent 10% or more of our revenue and accounts receivable and contract assets are as follows:
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Revenue |
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Accounts Receivable and |
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Three Months Ended |
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As of |
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As of |
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March 31, 2022 |
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March 31, 2021 |
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March 31, 2022 |
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December 31, 2021 |
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Licensee A |
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% |
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% |
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* |
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* |
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Licensee B |
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% |
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% |
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% |
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% |
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Licensee C |
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% |
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* |
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% |
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% |
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Licensee D |
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* |
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* |
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*Less than 10%
We monitor economic conditions to identify facts or circumstances that may indicate if any of our accounts receivable are not collectible or if the contract assets should be impaired.