SEC Filing - Biomea Fusion

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10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


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

For the quarterly period ended September 30, 2022


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

For the transition period from to

Commission File Number: 001-40335

Biomea Fusion, Inc.

(Exact Name of Registrant as Specified in its Charter)


Delaware	82-2520134
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
900 Middlefield Road, 4th Floor Redwood City, California	94063
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (650) 980-9099

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

Title of each class

Trading
Symbol(s)

Name of each exchange on which registered

Common Stock, $0.0001 par value

BMEA

The Nasdaq Global Select Market

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

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

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

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

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

As of October 31, 2022, the registrant had 29,396,246 shares of common stock, $0.0001 par value per share, outstanding.

Table of Contents


		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	1
	Condensed Balance Sheets	1
	Condensed Statements of Operations and Comprehensive Loss	2
	Condensed Statements of Convertible Preferred Stock and Stockholders’ Equity	3
	Condensed Statements of Cash Flows	5
	Notes to Unaudited Condensed Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	26
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	27
Item 1A.	Risk Factors	27
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	75
Item 3.	Defaults Upon Senior Securities	76
Item 4.	Mine Safety Disclosures	76
Item 5.	Other Information	76
Item 6.	Exhibits	77
Signatures		78

Special Note Regarding Forward Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future financial condition, future operations, projected costs, prospects, plans, objectives of management and expected market growth, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “aim,” “anticipate,” “assume,” “believe,” “contemplate,” “continue,” “could,” “design,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “positioned,” “potential,” “predict,” “seek,” “should,” “target,” “will,” “would” and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology. These forward-looking statements include, but are not limited to, statements about:

•

our financial performance;

•

the sufficiency of our existing cash, cash equivalents and investments to fund our future operating expenses and capital expenditure requirements;

•

our estimates regarding expenses, future revenue, capital requirements and needs for additional financing;

•

our anticipated use of our existing cash, cash equivalents and investments;

•

the implementation of our strategic plans for our business and product candidates;

•

the size of the market opportunity for our product candidates and our ability to maximize those opportunities;

•

the initiation, timing, progress and results of our research and development programs, preclinical studies, clinical trials and investigational new drug (IND) applications and other regulatory submissions;

•

the beneficial characteristics, safety, efficacy and therapeutic effects of BMF-219, BMF-500 and any other product candidates that we may identify and pursue;

•

the timing, progress and focus of our ongoing and future clinical trials, including our ongoing Phase 1 clinical trial of BMF-219 in multiple liquid tumor types (COVALENT-101), our planned Phase 1/1b clinical trial of BMF-219 in certain solid tumors with KRAS mutations (COVALENT-102) and our Phase 1/2 clinical trial in type 2 diabetes (COVALENT-111), and the reporting of data from those trials;

•

the ability of our clinical trials to demonstrate safety and efficacy of our product candidates, and other favorable results;

•

our plans relating to the clinical development of our product candidates, including the disease areas to be evaluated;

•

our ability to obtain and maintain regulatory approval of our product candidates;

•

our plans relating to commercializing our product candidates, if approved;

•

our estimates of the patient populations addressable by our product candidates, including BMF-219 and BMF-500, if approved, and the number of participants that will enroll in our ongoing and planned clinical trials;

•

the expected benefits of potential future strategic collaborations with third parties and our ability to attract collaborators with development, regulatory and commercialization expertise;

•

the success of competing therapies that are or may become available;

•

the timing or likelihood of regulatory filings and approvals, including our expectation to seek special designations, such as orphan drug designation, for our product candidates;

•

our plans relating to the further development and manufacturing of our product candidates, including for additional indications that we may pursue;

•

existing regulations and regulatory developments in the United States and other jurisdictions;

•

our plans and ability to obtain or protect intellectual property rights, including extensions of existing patent terms where available;

•

our plan to rely on third parties to conduct and support preclinical and clinical development;

•

our ability to retain the continued service of our key personnel and to identify, hire and then retain additional qualified personnel;

•

the impact of the ongoing COVID-19 pandemic or other related disruptions on our business;

•

unfavorable global economic conditions, including inflationary pressures, market volatility, acts of war and civil and political unrest; and

•

our expectations regarding the period during which we will qualify as an emerging growth company under the Jumpstart Our Business Startups Act of 2012, as amended.

We have based these forward-looking statements largely on our current expectations, estimates, forecasts and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. In light of the significant uncertainties in these forward-looking statements, you should not rely upon forward-looking statements as predictions of future events. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Quarterly Report on Form 10-Q, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur at all. You should refer to the section titled “Risk Factors” for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. We qualify all of the forward-looking statements in this Quarterly Report on Form 10-Q by these cautionary statements.

Biomea Fusion, Inc., the Biomea logo and our other registered or common law trademarks, trade names or service marks appearing in this Quarterly Report on Form 10-Q are owned by us. This Quarterly Report on Form 10-Q contains references to our trademarks and to trademarks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this Quarterly Report on Form 10-Q, including logos, artwork and other visual displays, generally appear without the ® or TM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies’ trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

Summary Risk Factors

The following is a summary of the principal factors that make an investment in our common stock speculative or risky. This summary does not address every aspect of our risk factors, all of the risks that we face, or other factors not presently known to us or that we currently believe are immaterial. Additional discussion of the risks summarized in these summary risk factors, and other risks that we face, can be found under the heading “Risk Factors” in this Quarterly Report on Form 10-Q and should be carefully considered, together with other information in this Quarterly Report on Form 10-Q and our other filings with the Securities and Exchange Commission, or SEC, before making investment decisions regarding our common stock.

•

We have a limited operating history, have not completed any clinical trials, have no products approved for commercial sale, and have not generated any revenue, which may make it difficult for you to evaluate our current business and likelihood of success and viability.

•

We will require substantial additional capital to finance our operations. If we are unable to raise such capital when needed, or on acceptable terms, we may be forced to delay, reduce and/or eliminate one or more of our research and product development programs or future commercialization efforts.

•

Our discovery and preclinical development is focused on the development of novel covalent small-molecule therapies to treat patients with genetically-defined cancers and metabolic diseases, and the approach we are taking to discover and develop such product candidates is novel, may never lead to marketable products and may not ultimately represent a significant market.

•

Our novel approach to the discovery and development of our current and future product candidates is unproven, and we may not be successful in our efforts to use and expand our FUSIONTM System to build a pipeline of product candidates with commercial value.

•

We are very early in our development efforts and are substantially dependent on our lead product candidate, BMF-219. If we are unable to advance BMF-219 or any of our future product candidates through clinical development, obtain regulatory approval and ultimately commercialize BMF-219 or any of our future product candidates, or experience significant delays in doing so, our business, financial condition and results of operations will be materially adversely affected.

•

Preclinical and clinical drug development is a lengthy and expensive process, with an uncertain outcome. Our preclinical and clinical programs may experience delays or may never be initiated or completed, which would adversely affect our ability to obtain regulatory approvals or commercialize our product candidates on a timely basis or at all, which could have an adverse effect on our business.

iii

•

The results of preclinical testing and early clinical trials may not be predictive of the success of later clinical trials, and the results of our clinical trials may not satisfy the requirements of the FDA or other comparable foreign regulatory authorities. Successful preclinical studies and clinical trials cannot provide assurance of successful commercialization.

•

We have no experience as a company in conducting clinical trials and have not successfully completed any clinical trials to date.

•

The ongoing COVID-19 pandemic and adverse global economic conditions, including supply chain issues and inflationary pressures, could materially adversely impact our business, results of operations, and financial condition, including our preclinical studies and clinical trials.

•

The regulatory approval processes of the FDA and other comparable foreign regulatory authorities are lengthy, time consuming and inherently unpredictable. If we are not able to obtain, or if there are delays in obtaining, required regulatory approvals for our product candidates, we will not be able to commercialize, or will be delayed in commercializing, our product candidates, and our ability to generate revenue will be materially impaired.

•

The price of our stock may be volatile, and you may not be able to resell shares of our common stock at or above the price you paid.

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

Biomea Fusion, Inc.

Condensed Balance Sheets

(Unaudited)

(in thousands, except share and per share amounts)


	September 30,			December 31,
	2022			2021
Assets
Current assets:
Cash and cash equivalents	$	132,311		$	145,736
Short-term investments		1,147			27,780
Prepaid expenses and other current assets		5,403			3,045
Total current assets		138,861			176,561
Long-term investments		10			1,876
Property and equipment, net		3,049			2,965
Operating lease right-of-use assets		2,296			2,722
Restricted cash		351			351
Other assets		483			1,230
Total assets	$	145,050		$	185,705
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	1,592		$	1,329
Accrued expenses and other current liabilities		10,392			2,743
Operating lease liabilities, current		605			565
Total current liabilities		12,589			4,637
Operating lease liabilities, non-current		1,826			2,285
Total liabilities		14,415			6,922
Commitments and contingencies (Note 8)
Stockholders' equity:
Preferred stock, $0.0001 par value; 10,000,000 shares authorized as of September 30, 2022 and December 31, 2021; 0 shares issued and outstanding as of September 30, 2022 and December 31, 2021		—			—
Common stock, $0.0001 par value; 300,000,000 shares authorized as of September 30, 2022 and December 31, 2021; 29,388,753 and 29,115,421 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively		3			3
Additional paid-in capital		236,901			228,532
Accumulated other comprehensive income (loss)		(13	)		(10	)
Accumulated deficit		(106,256	)		(49,742	)
Total stockholders' equity		130,635			178,783
Total liabilities and stockholders' equity	$	145,050		$	185,705

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

Biomea Fusion, Inc.

Condensed Statements of Operations and Comprehensive Loss

(Unaudited)

(in thousands, except share and per share amounts)


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2022			2021			2022			2021
Operating expenses:
Research and development	$	18,242		$	7,886		$	42,174		$	16,908
General and administrative		5,242			4,752			15,184			10,022
Total operating expenses		23,484			12,638			57,358			26,930
Loss from operations		(23,484	)		(12,638	)		(57,358	)		(26,930	)
Interest and other income (expense), net		594			32			844			73
Net loss	$	(22,890	)	$	(12,606	)	$	(56,514	)	$	(26,857	)
Other comprehensive loss:
Unrealized gain (loss) on investments, net		4			—			(3	)		2
Comprehensive loss	$	(22,886	)	$	(12,606	)	$	(56,517	)	$	(26,855	)
Net loss per common share, basic and diluted	$	(0.78	)	$	(0.43	)	$	(1.93	)	$	(1.21	)
Weighted-average number of common shares used to compute basic and diluted net loss per common share		29,319,042			29,001,213			29,214,549			22,105,321

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

Biomea Fusion, Inc.

Condensed Statements of Convertible Preferred Stock and Stockholders’ Equity

(Unaudited)

(in thousands, except share amounts)


	Series A Convertible Preferred Stock				Common Stock				Additional Paid-In		Accumulated Other Comprehensive			Accumulated			Total Stockholders'
	Shares		Amount		Shares		Amount		Capital		Gain (Loss)			Deficit			Equity
Balance at December 31, 2021		—	$	—		29,115,421	$	3	$	228,532	$	(10	)	$	(49,742	)	$	178,783
Exercise of stock options		—		—		6,044		—		31		—			—			31
Issuance of restricted stock		—		—		47,216		—		—		—			—			—
Stock-based compensation expense		—		—		—		—		2,330		—			—			2,330
Unrealized gain (loss) on investments		—		—		—		—		—		(13	)		—			(13	)
Net loss		—		—		—		—		—		—			(16,366	)		(16,366	)
Balance at March 31, 2022		—		—		29,168,681	$	3	$	230,893	$	(23	)	$	(66,108	)	$	164,765
Exercise of stock options		—		—		9,366		—		62		—			—			62
Issuance of restricted stock		—		—		47,216		—		—		—			—			—
Purchases under employee stock purchase plan		—		—		54,868		—		256		—			—			256
Stock-based compensation expense		—		—		—		—		2,559		—			—			2,559
Unrealized gain (loss) on investments		—		—		—		—		—		6			—			6
Net loss		—		—		—		—		—		—			(17,258	)		(17,258	)
Balance at June 30, 2022		—		—		29,280,131	$	3	$	233,770	$	(17	)	$	(83,366	)	$	150,390
Exercise of stock options		—		—		61,405		—		400		—			—			400
Issuance of restricted stock		—		—		47,217		—		—		—			—			—
Stock-based compensation expense		—		—		—		—		2,731		—			—			2,731
Unrealized gain (loss) on investments		—		—		—		—		—		4			—			4
Net loss		—		—		—		—		—		—			(22,890	)		(22,890	)
Balance at September 30, 2022		—		—		29,388,753	$	3	$	236,901	$	(13	)	$	(106,256	)	$	130,635


	Series A Convertible Preferred Stock						Common Stock				Additional Paid-In		Accumulated Other Comprehensive			Accumulated			Total Stockholders'
	Shares			Amount			Shares		Amount		Capital		Gain (Loss)			Deficit			Equity
Balance at December 31, 2020		7,064,925		$	55,738			11,953,107	$	1	$	13,343	$	—		$	(8,175	)	$	5,169
Series A financing costs		—			(3	)		—		—		—		—			—			—
Issuance of restricted stock		—			—			51,526		—		—		—			—			—
Stock-based compensation expense		—			—			—		—		919		—			—			919
Unrealized loss on investments		—			—			—		—		—		(15	)		—			(15	)
Net loss		—			—			—		—		—		—			(5,852	)		(5,852	)
Balance at March 31, 2021		7,064,925			55,735			12,004,633	$	1	$	14,262	$	(15	)	$	(14,027	)	$	221
Issuance of common stock from initial public offering, net of offering costs		—			—			9,823,532		1		152,753		—			—			152,754
Conversion of preferred stock to common stock		(7,064,925	)		(55,735	)		7,064,925		1		55,734		—			—			55,735
Exercise of stock options		—			—			43,850		—		225		—			—			225
Issuance of restricted stock		—			—