sldb-10q_20190930.htm

 

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, 2019

OR

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

For the transition period from                      to                     

Commission File Number: 001-38360

 

Solid Biosciences Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

 

90-0943402

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

141 Portland Street, Fifth Floor

Cambridge, MA

 

02139

(Address of principal executive offices)

 

(Zip Code)

Registrant’s telephone number, including area code: (617) 337-4680

 

 

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

Title of each class

Trading Symbol

Name of exchange on which registered

Common Stock $0.001 par value per share

SLDB

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.

 

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

 

Smaller reporting company

 

 

 

Emerging growth company

 

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

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

 

 

As of November 1, 2019, the registrant had 45,987,571 shares of common stock, $0.001 par value per share, outstanding.

  

 

 

 


 

Table of Contents

 

 

 

Page

PART  I.

FINANCIAL INFORMATION

2

Item 1.

Financial Statements (Unaudited)

2

 

Condensed Consolidated Balance Sheets at September 30, 2019 and December 31, 2018

2

 

Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2019 and 2018

3

 

Condensed Consolidated Statements of Comprehensive Loss for the three and nine months ended September 30, 2019 and 2018

4

 

Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three and nine months ended September 30, 2019 and 2018

5

 

Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2019 and 2018

7

 

Notes to the Condensed Consolidated Financial Statements

8

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

19

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

29

Item 4.

Controls and Procedures

30

PART II.

OTHER INFORMATION

32

Item 1.

Legal Proceedings

32

Item 1A.

Risk Factors

32

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

72

Item 6.

Exhibits

73

 

Signatures

74

 

1


 

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

SOLID BIOSCIENCES INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands, except share and per share data)

 

 

 

September 30,

 

 

December 31,

 

 

 

2019

 

 

2018

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

94,720

 

 

$

86,366

 

Available-for-sale-securities

 

 

10,943

 

 

 

36,098

 

Prepaid expenses and other current assets

 

 

7,829

 

 

 

6,175

 

Total current assets

 

 

113,492

 

 

 

128,639

 

Property and equipment, net

 

 

11,369

 

 

 

10,422

 

Operating lease, right-of-use assets

 

 

5,529

 

 

 

 

Other non-current assets

 

 

209

 

 

 

209

 

Restricted cash

 

 

327

 

 

 

327

 

Total assets

 

$

130,926

 

 

$

139,597

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

3,210

 

 

$

3,691

 

Accrued expenses

 

 

11,466

 

 

 

8,235

 

Operating lease liabilities

 

 

1,672

 

 

 

 

Finance lease liabilities

 

 

181

 

 

 

173

 

Other current liabilities

 

 

221

 

 

 

382

 

Total current liabilities

 

 

16,750

 

 

 

12,481

 

Operating lease liabilities, excluding current portion

 

 

4,869

 

 

 

 

Finance lease liabilities, excluding current portion

 

 

782

 

 

 

859

 

Other non-current liabilities

 

 

 

 

 

1,074

 

Total liabilities

 

 

22,401

 

 

 

14,414

 

Commitments and contingencies (Note 12)

 

 

 

 

 

 

 

 

Preferred stock, $0.001 par value; 10,000,000 shares authorized

   at September 30, 2019 and December 31, 2018; no shares issued and

   outstanding at September 30, 2019 and December 31, 2018

 

 

 

 

 

 

Common stock, $0.001 par value; 300,000,000 shares authorized at

   September 30, 2019 and December 31, 2018; 45,998,944 shares issued and

   outstanding at September 30, 2019 and 35,432,460 shares issued and outstanding

   at December 31, 2018; 2,295,699 pre-funded warrants outstanding at

   September 30, 2019 and no pre-funded warrants outstanding at December 31, 2018

 

 

48

 

 

 

35

 

Additional paid-in capital

 

 

392,897

 

 

 

324,209

 

Accumulated other comprehensive loss

 

 

(2

)

 

 

(5

)

Accumulated deficit

 

 

(284,418

)

 

 

(199,056

)

Total stockholders’ equity

 

 

108,525

 

 

 

125,183

 

Total liabilities and stockholders’ equity

 

$

130,926

 

 

$

139,597

 

 

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

2


 

SOLID BIOSCIENCES INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands, except share and per share data)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Revenue

 

$

 

 

$

 

 

$

 

 

$

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

22,792

 

 

 

14,680

 

 

 

67,671

 

 

 

40,203

 

General and administrative

 

 

6,925

 

 

 

4,470

 

 

 

19,317

 

 

 

13,098

 

Total operating expenses

 

 

29,717

 

 

 

19,150

 

 

 

86,988

 

 

 

53,301

 

Loss from operations

 

 

(29,717

)

 

 

(19,150

)

 

 

(86,988

)

 

 

(53,301

)

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

406

 

 

 

92

 

 

 

1,281

 

 

 

237

 

Other income

 

 

56

 

 

 

38

 

 

 

345

 

 

 

187

 

Total other income (expense), net

 

 

462

 

 

 

130

 

 

 

1,626

 

 

 

424

 

Net loss

 

$

(29,255

)

 

$

(19,020

)

 

$

(85,362

)

 

$

(52,877

)

Net loss per share attributable to common stockholders,

   basic and diluted

 

$

(0.67

)

 

$

(0.55

)

 

$

(2.26

)

 

$

(1.61

)

Weighted average shares of common stock outstanding,

   basic and diluted

 

 

43,467,618

 

 

 

34,539,001

 

 

 

37,727,640

 

 

 

32,800,126

 

 

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

3


 

SOLID BIOSCIENCES INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(unaudited, in thousands)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Net loss

 

$

(29,255

)

 

$

(19,020

)

 

$

(85,362

)

 

$

(52,877

)

Other comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain (loss) on available-for-sale securities

 

 

(5

)

 

 

4

 

 

 

3

 

 

7

 

Comprehensive loss

 

$

(29,260

)

 

$

(19,016

)

 

$

(85,359

)

 

$

(52,870

)

 

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

 

 

4


 

SOLID BIOSCIENCES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(unaudited, in thousands, except share / unit data)

 

 

 

For the Three Months Ended September 30, 2019

 

 

 

Series 2

Senior

Preferred

Units

 

 

Amount

 

 

Series 1

Senior

Preferred

Units

 

 

Amount

 

 

Junior

Preferred

Units

 

 

Amount

 

 

Series

A, B, C

and D

Common

Units

 

 

Amount

 

 

Common

Stock

 

 

Amount

 

 

Additional

paid

in capital

 

 

Accumulated

other

comprehensive

income (loss)

 

 

Accumulated

Deficit

 

 

Total

Stockholders'

Equity

 

Balance at June 30, 2019

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

35,398,894

 

 

$

35

 

 

$

331,620

 

 

$

3

 

 

$

(255,163

)

 

$

76,495

 

Equity-based

   compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3,392

 

 

 

 

 

 

 

 

 

3,392

 

Sale of common stock,

   net of issuance costs

   of $2,079

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10,607,525

 

 

11

 

 

 

47,235

 

 

 

 

 

 

 

 

 

 

 

47,246

 

Sale of pre-funded

   warrants

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,295,699

 

 

2

 

 

 

10,650

 

 

 

 

 

 

 

 

 

 

 

10,652

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(29,255

)

 

 

(29,255

)

Repurchase of shares of

   common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(7,475

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized loss on

   available for sale

   securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(5

)

 

 

 

 

 

(5

)

Balance at September 30,

   2019

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

48,294,643

 

 

$

48

 

 

$

392,897

 

 

$

(2

)

 

$

(284,418

)

 

$

108,525

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Nine Months Ended September 30, 2019

 

 

 

Series 2

Senior

Preferred

Units

 

 

Amount

 

 

Series 1

Senior

Preferred

Units

 

 

Amount

 

 

Junior

Preferred

Units

 

 

Amount

 

 

Series

A, B, C

and D

Common

Units

 

 

Amount

 

 

Common

Stock

 

 

Amount

 

 

Additional

paid

in capital

 

 

Accumulated

other

comprehensive

income (loss)

 

 

Accumulated

Deficit

 

 

Total

Stockholders'

Equity

 

Balance at December 31,

   2018

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

35,432,460

 

 

$

35

 

 

$

324,209

 

 

$

(5

)

 

$

(199,056

)

 

$

125,183

 

Equity-based

   compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10,803

 

 

 

 

 

 

 

 

 

10,803

 

Sale of common stock,

   net of issuance costs

   of $2,079

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10,607,525

 

 

11

 

 

 

47,235

 

 

 

 

 

 

 

 

 

 

 

47,246

 

Sale of pre-funded

   warrants

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,295,699

 

 

2

 

 

 

10,650

 

 

 

 

 

 

 

 

 

 

 

10,652

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(85,362

)

 

 

(85,362

)

Repurchase of shares of

   common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(41,041

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain on

   available for sale

   securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

 

 

 

 

 

3

 

Balance at September 30,

   2019

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

48,294,643

 

 

$

48

 

 

$

392,897

 

 

$

(2

)

 

$

(284,418

)

 

$

108,525

 

 

 

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

5


 

SOLID BIOSCIENCES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(unaudited, in thousands, except share / unit data)

 

 

 

For the Three Months Ended September 30, 2018

 

 

 

Series 2

Senior

Preferred

Units

 

 

Amount

 

 

Series 1

Senior

Preferred

Units

 

 

Amount

 

 

Junior

Preferred

Units

 

 

Amount

 

 

Series

A, B, C

and D

Common

Units

 

 

Amount

 

 

Common

Stock

 

 

Amount

 

 

Additional

paid

in capital

 

 

Accumulated

other

comprehensive

income (loss)

 

 

Accumulated

Deficit

 

 

Total

Stockholders'

Equity

 

Balance at June 30, 2018

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

35,444,792

 

 

$

35

 

 

$

320,382

 

 

$

(10

)

 

$

(158,115

)

 

$

162,292

 

Equity-based

   compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,797

 

 

 

 

 

 

 

 

 

1,797

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(19,020

)

 

 

(19,020

)

Repurchase of shares of

   common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(12,332

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain on

   available for sale

   securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4

 

 

 

 

 

 

4

 

Balance at September 30,

   2018

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

 

 

$

 

 

 

35,432,460

 

 

$

35

 

 

$

322,179

 

 

$

(6

)

 

$

(177,135

)

 

$

145,073

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Nine Months Ended September 30, 2018

 

 

 

Series 2

Senior

Preferred

Units

 

 

Amount

 

 

Series 1

Senior

Preferred

Units

 

 

Amount

 

 

Junior

Preferred

Units

 

 

Amount

 

 

Series

A, B, C

and D

Common

Units

 

 

Amount

 

 

Common

Stock

 

 

Amount

 

 

Additional

paid

in capital

 

 

Accumulated

other

comprehensive

income (loss)

 

 

Accumulated

Deficit

 

 

Total

Stockholders'

Equity (Deficit)

 

Balance at December 31,

   2017

 

 

4,886,000

 

 

$

55,002

 

 

 

2,500,000

 

 

$

25,000

 

 

 

4,414,356

 

 

$

44,177

 

 

 

19,438,552

 

 

$

65,014

 

 

 

 

 

$

 

 

$

 

 

$

(13

)

 

$

(124,258

)

 

$

(59,257

)

Conversion of units into

   shares of common

   stock

 

 

(4,886,000

)

 

 

(55,002

)

 

 

(2,500,000

)

 

 

(25,000

)

 

 

(4,414,356

)

 

 

(44,177

)

 

 

(19,429,620

)

 

 

(65,180

)

 

 

26,498,559

 

 

 

26

 

 

 

189,333

 

 

 

 

 

 

 

 

 

124,179

 

Issuance of common

   stock upon initial

   public offering, net

   of issuance costs of

   $4,592

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8,984,375

 

 

$

9

 

 

 

129,087

 

 

 

 

 

 

 

 

 

129,096

 

Equity-based

   compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

166

 

 

 

 

 

 

 

 

 

 

 

3,759

 

 

 

 

 

 

 

 

 

3,925

 

Net loss