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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification Number)
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(Address of principal executive offices)
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(Zip Code)
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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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||
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Large accelerated filer
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☐ |
Accelerated filer
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☐ |
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☒ |
Smaller reporting company
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Emerging growth company
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Page
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PART I—FINANCIAL INFORMATION
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Item 1.
|
1
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1
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||
2
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||
3
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||
4
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||
5
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||
Item 2.
|
17
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|
Item 3.
|
28
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Item 4.
|
29
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PART II—OTHER INFORMATION
|
||
Item 1.
|
30
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|
Item 1A.
|
30
|
|
Item 2.
|
112 | |
Item 3.
|
112 | |
Item 4.
|
113 | |
Item 5.
|
113 | |
Item 6.
|
113 | |
• |
the ability of our ongoing and planned future preclinical studies and clinical trials to demonstrate safety and efficacy of our product candidates, and other positive results;
|
• |
the timing, progress and results of ongoing and planned future preclinical studies and clinical trials for our current product candidates and other product candidates we may
develop, including statements regarding the timing of initiation and completion of preclinical studies or clinical trials and related preparatory work, the period during which the results of the preclinical studies or clinical trials will
become available, and our research and development programs;
|
• |
the timing, scope and likelihood of regulatory filings and approvals, including timing of investigational new drug applications (INDs) and final U.S. Food and Drug Administration
(FDA) approval of our current product candidates and any other future product candidates;
|
• |
the timing, scope or likelihood of foreign regulatory filings and approvals;
|
• |
our ability to develop and advance our current product candidates and programs into, and successfully complete, clinical trials;
|
• |
our manufacturing, commercialization, and marketing capabilities and strategy;
|
• |
our plans relating to commercializing our product candidates, if approved, including the geographic areas of focus and sales strategy;
|
• |
the need to hire additional personnel and our ability to attract and retain such personnel;
|
• |
the size of the market opportunity for our product candidates, including our estimates of the number of patients who suffer from the diseases we are targeting;
|
• |
our expectations regarding the approval and use of our product candidates in combination with other drugs;
|
• |
our competitive position and the success of competing therapies that are or may become available;
|
• |
our estimates of the number of patients that we will enroll in our clinical trials;
|
• |
the beneficial characteristics, and the potential safety, efficacy and therapeutic effects of our product candidates;
|
• |
our ability to obtain and maintain regulatory approval of our product candidates;
|
• |
our plans relating to the further development of our product candidates, including additional indications we may pursue;
|
• |
existing regulations and regulatory developments in the United States, Europe and other jurisdictions;
|
• |
our expectations regarding the impact of the COVID‑19 pandemic on our business;
|
• |
our intellectual property position, including the scope of protection we are able to establish and maintain for intellectual property rights covering our current product candidates and other future product candidates we may develop,
including the extensions of existing patent terms where available, the validity of intellectual property rights held by third parties, and our ability not to infringe, misappropriate or otherwise violate any third-party intellectual
property rights;
|
• |
our continued reliance on third parties to conduct ongoing and planned future preclinical studies and clinical trials of our product candidates, and for the
manufacture of our product candidates for preclinical studies and clinical trials;
|
• |
our ability to obtain, and negotiate favorable terms of, any collaboration, licensing or other arrangements that may be necessary or desirable to develop, manufacture or commercialize our product candidates;
|
• |
the pricing and reimbursement of our current product candidates and other product candidates we may develop, if approved;
|
• |
the rate and degree of market acceptance and clinical utility of our current product candidates and other product candidates we may develop;
|
• |
our estimates regarding expenses, future revenue, capital requirements and needs for additional financing;
|
• |
our financial performance;
|
• |
the period over which we estimate our existing cash and cash equivalents will be sufficient to fund our future operating expenses and capital expenditure requirements;
|
• |
the impact of laws and regulations;
|
• |
our expectations regarding the period during which we will remain an emerging growth company (EGC) under the Jumpstart Our Business Startups Act of 2012 (JOBS Act); and
|
• |
our anticipated use of our existing resources.
|
March 31, 2022
|
December 31, 2021
|
|||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Cash at consolidated joint venture
|
||||||||
Short-term investments
|
|
|
||||||
Prepaid expenses and other current assets
|
|
|
||||||
Total current assets
|
|
|
||||||
Property and equipment, net
|
|
|
||||||
Right-of-use lease assets
|
||||||||
Long-term investments
|
|
|
||||||
Restricted cash |
||||||||
Deferred offering costs
|
||||||||
Other non-current assets |
||||||||
Total assets
|
$
|
|
$
|
|
||||
Liabilities, Redeemable Convertible Noncontrolling Interests and Stockholders’ Equity
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
|
$
|
|
||||
Accrued expenses
|
|
|
||||||
Current portion of operating lease liabilities | ||||||||
Total current liabilities
|
|
|||||||
Operating lease liabilities, long-term | ||||||||
Total liabilities
|
||||||||
Commitments and contingencies (See Note 12)
|
||||||||
Redeemable convertible noncontrolling interests | ||||||||
Stockholders’ equity:
|
||||||||
Preferred stock, $
|
|
|
||||||
Common stock, $
|
|
|
||||||
Additional paid-in capital
|
|
|
||||||
Accumulated other comprehensive loss
|
(
|
)
|
(
|
)
|
||||
Accumulated deficit
|
(
|
)
|
(
|
)
|
||||
Total stockholders’ equity
|
|
|
||||||
Total liabilities, redeemable convertible noncontrolling interests and stockholders’ equity
|
$
|
|
$
|
|
Three Months Ended March 31,
|
||||||||
2022
|
2021
|
|||||||
Operating expenses:
|
||||||||
Research and development
|
$
|
|
$
|
|
||||
General and administrative
|
|
|
||||||
Total operating expenses
|
|
|
||||||
Loss from operations
|
(
|
)
|
(
|
)
|
||||
Other income, net
|
||||||||
Net loss | ( |
) | ( |
) | ||||
Net loss attributable to redeemable convertible noncontrolling interests
|
||||||||
Net loss attributable to Kinnate
|
$
|
(
|
)
|
$ | ( |
) | ||
Weighted-average shares outstanding, basic and diluted
|
||||||||
Net loss per share, basic and diluted
|
$ | ( |
) | $ | ( |
) | ||
Comprehensive loss: | ||||||||
Net loss | $ | ( |
) | $ | ( |
) | ||
Other comprehensive loss:
|
||||||||
Unrealized loss on investments
|
( |
) | ( |
) | ||||
Total comprehensive loss | ( |
) | ( |
) | ||||
Comprehensive loss attributable to redeemable convertible noncontrolling interests
|
|
|
||||||
Comprehensive loss attributable to Kinnate
|
$
|
(
|
)
|
$
|
(
|
)
|
Common Stock
|
Additional
Paid-in |
Accumulated Other Comprehensive
|
Accumulated
|
Total
Stockholders’ |
Redeemable Convertible Noncontrolling
|
|||||||||||||||||||||||
|
Shares
|
Amount
|
Capital
|
Loss
|
Deficit
|
Equity
|
Interests
|
|||||||||||||||||||||
|
||||||||||||||||||||||||||||
Balance at December 31, 2021
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||||||||
Stock-based compensation expense
|
-
|
|
|
|
|
|
|
|||||||||||||||||||||
Exercise of stock options
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Net loss
|
-
|
|
|
|
(
|
)
|
(
|
)
|
|
|||||||||||||||||||
Other comprehensive loss
|
-
|
|
|
(
|
)
|
|
(
|
)
|
|
|||||||||||||||||||
Balance at March 31, 2022
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||||||||
|
||||||||||||||||||||||||||||
Balance at December 31, 2020
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||||||||
Stock-based compensation expense
|
-
|
|
|
|
|
|
|
|||||||||||||||||||||
Net loss
|
-
|
|
|
|
(
|
)
|
(
|
)
|
|
|||||||||||||||||||
Other comprehensive loss
|
-
|
|
|
(
|
)
|
|
(
|
)
|
|
|||||||||||||||||||
Balance at March 31, 2021
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
$
|
|
|
Three Months Ended March 31,
|
|||||||
|
2022
|
2021
|
||||||
Cash flows from operating activities:
|
||||||||
Net loss
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||
Stock-based compensation expense
|
|
|
||||||
Depreciation
|
|
|
||||||
Amortization/accretion of investments
|
|
|
||||||
Loss on disposal of property and equipment
|
|
|
||||||
Changes in operating assets and liabilities:
|
||||||||
Prepaid expenses and other assets
|
(
|
)
|
|
|||||
Operating lease right-of-use assets and liabilities, net
|
|
|
||||||
Accounts payable and accrued expenses
|
|
|
||||||
Net cash used in operating activities
|
(
|
)
|
(
|
)
|
||||
Cash flows from investing activities:
|
||||||||
Purchases of short-term and long-term investments
|
(
|
)
|
(
|
)
|
||||
Sales and maturities of short-term and long-term investments
|
|
|
||||||
Purchases of property and equipment
|
(
|
)
|
(
|
)
|
||||
Net cash used in investing activities
|
(
|
)
|
(
|
)
|
||||
Cash flows from financing activities:
|
||||||||
Proceeds from stock option exercises
|
|
|
||||||
Net cash provided by financing activities
|
|
|
||||||
Net decrease in cash, cash equivalents and restricted cash
|
(
|
)
|
(
|
)
|
||||
Cash, cash equivalents and restricted cash at the beginning of the period
|
|
|
||||||
Cash, cash equivalents and restricted cash at the end of the period
|
$
|
|
$
|
|
||||
|
||||||||
Supplemental non-cash investing and financing activity:
|
||||||||
Purchases of property and equipment in accounts payable and accrued expenses
|
$
|
|
$
|
|
||||
Capitalized value of tenant improvement allowance
|
$
|
|
$
|
|
||||
Operating lease liabilities arising from obtaining right-of-use assets
|
$
|
|
$
|
|
Three Months Ended March 31,
|
||||||||
2022
|
2021
|
|||||||
Numerator
|
||||||||
Net loss attributable to Kinnate
|
$
|
(
|
)
|
$
|
(
|
)
|
||
Denominator
|
||||||||
Weighted-average shares outstanding used in computing net loss per share, basic and diluted
|
|
|
||||||
Net loss per share, basic and diluted
|
$
|
(
|
)
|
$
|
(
|
)
|
Three Months Ended March 31,
|
||||||||
2022
|
2021
|
|||||||
Options to purchase common stock
|
|
|
March 31, 2022
|
December 31, 2021
|
|||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Cash at consolidated joint venture | ||||||||
Restricted cash, non-current
|
|
|
||||||
Total cash, cash equivalents and restricted cash reported in the Condensed Consolidated Statements of Cash Flows
|
$
|
|
$
|
|
March 31, 2022
|
December 31, 2021
|
|||||||
Furniture and fixtures
|
$
|
|
$
|
|
||||
Computers and equipment
|
|
|
||||||
Computer software
|
|
|
||||||
Leasehold improvements |
||||||||
Property and equipment
|
|
|
||||||
Less accumulated depreciation
|
(
|
)
|
(
|
)
|
||||
Property and equipment, net
|
$
|
|
$
|
|
March 31, 2022
|
December 31, 2021
|
|||||||
Accrued research and development
|
$
|
|
$
|
|
||||
Accrued compensation
|
|
|
||||||
Accrued legal fees
|
|
|
||||||
Other accruals
|
|
|
||||||
Total
|
$
|
|
$
|
|
March 31, 2022
|
||||||||||||||||||||
Maturity
in Years
|
Amortized
Cost
|
Unrealized
Gains
|
Unrealized
Losses
|
Estimated
Fair Value
|
||||||||||||||||
Corporate debt securities
|
less than
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
Commercial paper
|
less than
|
|
|
|
|
|||||||||||||||
U.S. Treasury securities |
less than |
( |
) | |||||||||||||||||
Asset-backed securities | less than |
( |
) | |||||||||||||||||
Short-term investments
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||
Corporate debt securities
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
U.S. Treasury securities
|
|
|
|
(
|
)
|
|
||||||||||||||
Asset-backed securities
|
|
|
|
(
|
)
|
|
||||||||||||||
Long-term investments
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
December 31, 2021 |
||||||||||||||||||||
|
Maturity
in Years
|
Amortized
Cost
|
Unrealized
Gains
|
Unrealized
Losses
|
Estimated
Fair Value
|
|||||||||||||||
Corporate debt securities
|
less than |
$ | $ | $ | ( |
) | $ | |||||||||||||
U.S. Treasury securities | less than |
( |
) | |||||||||||||||||
Asset-backed securities
|
less than |
( |
) | |||||||||||||||||
Short-term investments
|
$ | $ | $ | ( |
) | $ | ||||||||||||||
U.S. Treasury securities | $ | $ | $ | ( |
) | $ | ||||||||||||||
Long-term investments
|
$ | $ | $ | ( |
) | $ |
Fair Value Measurements at March 31, 2022
|
||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Money market funds
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Corporate debt securities
|
|
|
|
|
||||||||||||
Commercial paper
|
|
|
|
|
||||||||||||
U.S. Treasury securities
|
|
|
|
|
||||||||||||
Asset-backed securities
|
|
|
|
|
||||||||||||
Total cash equivalents and
investments
|
$
|
|
$
|
|
$
|
|
$
|
|
Fair Value Measurements at December 31, 2021
|
||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Money market funds
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Corporate debt securities
|
|
|
|
|
||||||||||||
U.S. Treasury securities | ||||||||||||||||
Asset-backed securities
|
|
|
|
|
||||||||||||
Total cash equivalents and
investments
|
$
|
|
$
|
|
$
|
|
$
|
|
Options
|
Weighted-
Average
Exercise Price
|
Weighted-
Average
Remaining
Contractual
Term (in years)
|
Aggregate
Intrinsic
Value
(in thousands)
|
|||||||||||||
Outstanding at January 1, 2022
|
|
$
|
|
|
$
|
|
||||||||||
Granted
|
|
|
||||||||||||||
Exercised
|
(
|
)
|
|
|||||||||||||
Forfeited
|
(
|
)
|
|
|||||||||||||
Outstanding at March 31, 2022
|
|
$
|
|
|
$
|
|
||||||||||
Exercisable at March 31, 2022
|
|
$
|
|
|
$
|
|
|
Three Months Ended March 31,
|
||||||
|
2022
|
2021
|
|||||
|
|||||||
Expected term (in years)
|
|
|
|||||
Expected volatility
|
|
|
|
||||
Risk-free interest rate
|
|
|
|
||||
Expected dividend
|
|
|
|
|
Three Months Ended March 31,
|
|||||||
|
2022
|
2021
|
||||||
|
||||||||
Expected term (in years)
|
|
|
||||||
Expected volatility
|
|
|
||||||
Risk-free interest rate
|
|
|
||||||
Expected dividend
|
|
|
|
Three Months Ended March 31,
|
|||||||
|
2022
|
2021
|
||||||
Research and development
|
$
|
|
$
|
|
||||
General and administrative
|
|
|
||||||
Total stock-based compensation
|
$
|
|
$
|
|
|
March 31, 2022
|
May 13, 2021
|
||||||
Cash at consolidated joint venture
|
$
|
|
$
|
|
||||
Prepaid expenses and other current assets
|
|
|
||||||
Right-of-use lease assets
|
|
|
||||||
Other non-current assets
|
|
|
||||||
Accounts payable and accrued expenses
|
|
|
||||||
Operating lease liabilities
|
|
|
|
Operating Leases
|
|||
2022 remaining 9 months
|
$
|
|
||
2023
|
|
|||
2024
|
|
|||
2025
|
|
|||
2026
|
|
|||
Thereafter
|
|
|||
Total minimum lease payments
|
|
|||
Less: imputed interest
|
(
|
)
|
||
Total operating lease liabilities
|
|
|||
Less: current portion
|
(
|
)
|
||
Lease liability, net of current portion
|
$
|
|
Year Ending December 31,
|
Operating Leases
|
|||
2022
|
$
|
|
||
2023
|
|
|||
2024
|
|
|||
2025
|
|
|||
2026
|
|
|||
Thereafter
|
|
|||
Total mimium lease payments
|
$
|
|
Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
|
• |
advance our RAF and FGFR programs through clinical development;
|
• |
advance the development of our other small molecule research programs, including our CDK12 inhibitor and next-generation programs for our product candidates;
|
• |
expand our pipeline of product candidates through our own product discovery and development efforts;
|
• |
seek to discover and develop additional product candidates;
|
• |
seek regulatory approvals for any product candidates that successfully complete clinical trials;
|
• |
establish a sales, marketing and distribution infrastructure to commercialize any approved product candidates and related additional commercial manufacturing costs;
|
• |
implement operational, financial and management systems;
|
• |
attract, hire and retain additional clinical, scientific, management and administrative personnel;
|
• |
maintain, expand, protect and enforce our intellectual property portfolio, including patents, trade secrets and know how; and
|
• |
operate as a public company.
|
• |
expenses incurred in connection with the discovery, preclinical and clinical development of our product candidates, including under agreements with third parties, such as consultants and CROs;
|
• |
the cost of manufacturing compounds for use in our preclinical and clinical studies, including under agreements with third parties, such as consultants and contract manufacturing organizations (CMOs); and
|
• |
costs associated with consultants for chemistry, manufacturing and controls, development, regulatory, statistics and other
services, including expenses for technology and facilities.
|
• |
the timing and progress of preclinical and clinical development activities;
|
• |
the number and scope of preclinical and clinical programs we decide to pursue;
|
• |
our ability to maintain our current research and development programs and to establish new ones;
|
• |
establishing an appropriate safety profile with IND-enabling toxicology studies;
|
• |
successful patient enrollment in, and the initiation and completion of, clinical trials;
|
• |
per-subject trial costs;
|
• |
the number of clinical trials required
for regulatory approval;
|
• |
the countries in which the clinical trials
are conducted;
|
• |
the length of time required to enroll eligible subjects and initiate clinical trials;
|
• |
the number of subjects that participate in the clinical trials;
|
• |
the drop-out and discontinuation rate of subjects;
|
• |
potential additional safety monitoring requested by regulatory authorities;
|
• |
the duration of subject participation in the clinical trials and follow-up;
|
• |
the successful completion of clinical trials with safety, tolerability and efficacy profiles that are satisfactory to applicable regulatory authorities;
|
• |
the receipt of regulatory approvals from applicable regulatory authorities;
|
• |
the timing, receipt and terms of any marketing approvals and post-marketing approval commitments from applicable regulatory authorities;
|
• |
the extent to which we establish collaborations, strategic partnerships or other strategic arrangements with third parties, if any, and the performance of any such third party;
|
• |
obtaining and retaining research and development personnel;
|
• |
establishing commercial manufacturing capabilities or making arrangements with CMOs;
|
• |
development and timely delivery of commercial-grade drug formulations that can be used in our ongoing and planned future clinical trials and for commercial launch; and
|
• |
obtaining, maintaining, defending and enforcing patent claims and other intellectual property rights.
|
Three Months Ended March 31,
|
Change
|
|||||||||||
2022
|
2021
|
|||||||||||
(in thousands)
|
||||||||||||
Operating expenses:
|
||||||||||||
Research and development
|
$
|
19,647
|
$
|
12,666
|
$
|
6,981
|
||||||
General and administrative
|
7,412
|
4,815
|
2,597
|
|||||||||
Total operating expenses
|
27,059
|
17,481
|
9,578
|
|||||||||
Loss from operations
|
(27,059
|
)
|
(17,481
|
)
|
(9,578
|
)
|
||||||
Other income, net
|
157
|
24
|
133
|
|||||||||
Net loss
|
(26,902
|
)
|
(17,457
|
)
|
(9,445
|
)
|
||||||
Net loss attributable to redeemable convertible noncontrolling interests
|
-
|
-
|
-
|
|||||||||
Net loss attributable to Kinnate
|
$
|
(26,902
|
)
|
$
|
(17,457
|
)
|
$
|
(9,445
|
)
|
Three Months Ended March 31,
|
Increase
(Decrease)
|
|||||||||||
2022
|
2021
|
|||||||||||
(in thousands)
|
||||||||||||
External expenses:
|
||||||||||||
RAF
|
$
|
5,354
|
$
|
4,604
|
$
|
750
|
||||||
FGFR
|
2,841
|
2,493
|
348
|
|||||||||
Other programs and other unallocated costs
|
4,017
|
2,012
|
2,005
|
|||||||||
Total external expenses
|
12,212
|
9,109
|
3,103
|
|||||||||
Internal expenses
|
7,435
|
3,557
|
3,878
|
|||||||||
Total research and development expenses
|
$
|
19,647
|
$
|
12,666
|
$
|
6,981
|
• |
advance our RAF and FGFR programs through clinical development;
|