10-Q
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`

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 June 30, 2022

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.)

 

 

 

500 Rutherford Avenue, Third Floor

Charlestown, MA

 

02129

(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 August 8, 2022, the registrant had 112,989,773 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 June 30, 2022 and December 31, 2021

2

 

Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2022 and 2021

3

 

Condensed Consolidated Statements of Comprehensive Loss for the three and six months ended June 30, 2022 and 2021

4

 

Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three and six months ended June 30, 2022 and 2021

5

 

Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2022 and 2021

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

31

Item 4.

Controls and Procedures

31

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

85

Item 6.

Exhibits

86

 

Signatures

87

 

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)

 

 

 

June 30,

 

 

December 31,

 

 

 

2022

 

 

2021

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

54,311

 

 

$

119,136

 

Available-for-sale securities

 

 

108,572

 

 

 

88,643

 

Prepaid expenses and other current assets

 

 

7,319

 

 

 

14,723

 

Restricted cash, current

 

 

237

 

 

 

 

Accounts receivable - related party

 

 

 

 

 

110

 

Total current assets

 

 

170,439

 

 

 

222,612

 

Property and equipment, net

 

 

6,847

 

 

 

6,462

 

Operating lease, right-of-use assets

 

 

28,939

 

 

 

1,142

 

Other non-current assets

 

 

438

 

 

 

94

 

Restricted cash

 

 

1,833

 

 

 

2,070

 

Total assets

 

$

208,496

 

 

$

232,380

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

5,109

 

 

$

4,463

 

Accrued expenses

 

 

16,141

 

 

 

9,528

 

Operating lease liabilities

 

 

33

 

 

 

1,263

 

Finance lease liabilities

 

 

412

 

 

 

232

 

Other current liabilities

 

 

23

 

 

 

35

 

Deferred revenue - related party

 

 

 

 

 

8,080

 

Total current liabilities

 

 

21,718

 

 

 

23,601

 

Operating lease liabilities, excluding current portion

 

 

24,543

 

 

 

275

 

Finance lease liabilities, excluding current portion

 

 

 

 

 

293

 

Total liabilities

 

 

46,261

 

 

 

24,169

 

Commitments and contingencies

 

 

 

 

 

 

Preferred stock, $0.001 par value; 10,000,000 shares authorized
   at June 30, 2022 and December 31, 2021;
no shares issued and
   outstanding at June 30, 2022 and December 31, 2021

 

 

 

 

Common stock, $0.001 par value; 300,000,000 shares authorized at
   June 30, 2022 and December 31, 2021;
112,964,698 shares issued and
   outstanding at June 30, 2022 and
110,340,281 shares issued and
   outstanding at December 31, 2021;
no pre-funded warrants outstanding at June 30,
   2022 and
2,158,329 pre-funded warrants outstanding at December 31, 2021

 

 

112

 

 

 

112

 

Additional paid-in capital

 

 

689,422

 

 

 

684,901

 

Accumulated other comprehensive loss

 

 

(122

)

 

 

(45

)

Accumulated deficit

 

 

(527,177

)

 

 

(476,757

)

Total stockholders’ equity

 

 

162,235

 

 

 

208,211

 

Total liabilities and stockholders’ equity

 

$

208,496

 

 

$

232,380

 

 

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 June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Collaboration revenue - related party

 

$

6,169

 

 

$

3,594

 

 

$

8,094

 

 

$

6,929

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

23,180

 

 

 

15,513

 

 

 

43,125

 

 

 

29,719

 

General and administrative

 

 

6,851

 

 

 

6,766

 

 

 

14,203

 

 

 

12,781

 

Restructuring charges

 

 

1,520

 

 

 

 

 

 

1,520

 

 

 

 

Total operating expenses

 

 

31,551

 

 

 

22,279

 

 

 

58,848

 

 

 

42,500

 

Loss from operations

 

 

(25,382

)

 

 

(18,685

)

 

 

(50,754

)

 

 

(35,571

)

Other income (expense), net

 

 

290

 

 

 

(10

)

 

 

334

 

 

 

(24

)

Net loss

 

$

(25,092

)

 

$

(18,695

)

 

$

(50,420

)

 

$

(35,595

)

Net loss per share attributable to common stockholders,
   basic and diluted

 

$

(0.22

)

 

$

(0.17

)

 

$

(0.45

)

 

$

(0.35

)

Weighted average shares of common stock outstanding,
   basic and diluted

 

 

112,859,461

 

 

 

112,298,982

 

 

 

112,735,101

 

 

 

100,850,878

 

 

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 June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net loss

 

$

(25,092

)

 

$

(18,695

)

 

$

(50,420

)

 

$

(35,595

)

Other comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized loss on available-for-sale securities

 

 

(71

)

 

 

(11

)

 

 

(77

)

 

 

(11

)

Comprehensive loss

 

$

(25,163

)

 

$

(18,706

)

 

$

(50,497

)

 

$

(35,606

)

 

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 data)

 

 

 

 

For the Three Months Ended June 30, 2022

 

 

 

Common
Stock

 

 

Amount

 

 

Additional
Paid
in Capital

 

 

Accumulated
Other
Comprehensive
Loss

 

 

Accumulated
Deficit

 

 

Total
Stockholders'
Equity

 

Balance at March 31, 2022

 

 

112,781,291

 

 

$

112

 

 

$

687,535

 

 

$

(51

)

 

$

(502,085

)

 

$

185,511

 

Equity-based compensation

 

 

 

 

 

 

 

 

1,814

 

 

 

 

 

 

 

 

 

1,814

 

Vesting of restricted stock units

 

 

30,576

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of ESPP shares

 

 

152,831

 

 

 

 

 

 

73

 

 

 

 

 

 

 

 

 

73

 

Unrealized loss on available-for-sale
   securities

 

 

 

 

 

 

 

 

 

 

 

(71

)

 

 

 

 

 

(71

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(25,092

)

 

 

(25,092

)

Balance at June 30, 2022

 

 

112,964,698

 

 

$

112

 

 

$

689,422

 

 

$

(122

)

 

$

(527,177

)

 

$

162,235

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Six Months Ended June 30, 2022

 

 

 

Common
Stock

 

 

Amount

 

 

Additional
Paid
in Capital

 

 

Accumulated
Other
Comprehensive
Loss

 

 

Accumulated
Deficit

 

 

Total
Stockholders'
Equity

 

Balance at December 31, 2021

 

 

112,498,610

 

 

$

112

 

 

$

684,901

 

 

$

(45

)

 

$

(476,757

)

 

$

208,211

 

Equity-based compensation

 

 

 

 

 

 

 

 

4,426

 

 

 

 

 

 

 

 

 

4,426

 

Exercise of pre-funded warrants

 

 

 

 

 

 

 

 

22

 

 

 

 

 

 

 

 

 

22

 

Vesting of restricted stock units

 

 

313,257

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of ESPP shares

 

 

152,831

 

 

 

 

 

 

73

 

 

 

 

 

 

 

 

 

73

 

Unrealized loss on available-for-sale
   securities

 

 

 

 

 

 

 

 

 

 

 

(77

)

 

 

 

 

 

(77

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(50,420

)

 

 

(50,420

)

Balance at June 30, 2022

 

 

112,964,698

 

 

$

112

 

 

$

689,422

 

 

$

(122

)

 

$

(527,177

)

 

$

162,235

 

 

5


 

 

 

For the Three Months Ended June 30, 2021

 

 

 

Common
Stock

 

 

Amount

 

 

Additional
Paid
in Capital

 

 

Accumulated
Other
Comprehensive
Income (Loss)

 

 

Accumulated
Deficit

 

 

Total
Stockholders'
Equity

 

Balance at March 31, 2021

 

 

112,446,896

 

 

$

112

 

 

$

674,357

 

 

$

 

 

$

(421,469

)

 

$

253,000

 

Equity-based compensation

 

 

 

 

 

 

 

 

3,635

 

 

 

 

 

 

 

 

 

3,635

 

Exercise of stock options

 

 

2,475

 

 

 

 

 

 

9

 

 

 

 

 

 

 

 

 

9

 

Vesting of restricted stock units

 

 

6,262

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Forfeiture of restricted stock awards

 

 

(1,312

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

unrealized loss on available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

(11

)

 

 

 

 

 

(11

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(18,695

)

 

 

(18,695

)

Balance at June 30, 2021

 

 

112,454,321

 

 

$

112

 

 

$

678,001

 

 

$

(11

)

 

$

(440,164

)

 

$

237,938

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Six Months Ended June 30, 2021

 

 

 

Common
Stock

 

 

Amount

 

 

Additional
Paid
In capital

 

 

Accumulated
Other
Comprehensive
Income (Loss)

 

 

Accumulated
Deficit

 

 

Total
Stockholders'
Equity

 

Balance at December 31, 2020

 

 

87,052,323

 

 

$

87

 

 

$

536,568

 

 

$

 

 

$

(404,569

)

 

$

132,086

 

Equity-based compensation

 

 

 

 

 

 

 

 

6,542

 

 

 

 

 

 

 

 

 

6,542

 

Sale of common stock, net of issuance costs of $8,872

 

 

25,000,000

 

 

 

25

 

 

 

134,853

 

 

 

 

 

 

 

 

 

134,878

 

Exercise of stock options

 

 

10,625

 

 

 

 

 

 

38

 

 

 

 

 

 

 

 

 

38

 

Vesting of restricted stock units

 

 

419,193

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Forfeiture of restricted stock awards

 

 

(27,820

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized loss on available-for-sale securities

 

 

 

 

 

 

 

 

 

 

 

(11

)

 

 

 

 

 

(11

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(35,595

)

 

 

(35,595

)

Balance at June 30, 2021

 

 

112,454,321

 

 

$

112

 

 

$

678,001

 

 

$

(11

)

 

$

(440,164

)

 

$

237,938

 

 

 

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

6


 

SOLID BIOSCIENCES INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

 

 

 

Six Months Ended
June 30,

 

 

 

2022

 

 

2021

 

Cash flows from operating activities:

 

 

 

 

 

 

Net loss

 

$

(50,420

)

 

$

(35,595

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Amortization of premium on available-for-sale securities

 

 

526

 

 

 

7

 

Equity-based compensation expense

 

 

4,426

 

 

 

6,542

 

Depreciation expense

 

 

1,431

 

 

 

1,453

 

Loss on disposal of property and equipment

 

 

 

 

 

3

 

Gain on termination of lease

 

 

(249

)

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Prepaid expenses and other current and non-current assets

 

 

586

 

 

 

621

 

Accounts receivable - related party

 

 

110

 

 

 

(286

)

Accounts payable

 

 

373

 

 

 

(318

)

Accrued expenses and other current and non-current liabilities

 

 

8,229

 

 

 

(4,529

)

Deferred revenue- related party, current and non-current

 

 

(8,080

)

 

 

(6,364

)

Net cash used in operating activities

 

 

(43,068

)

 

 

(38,466

)

Cash flows from investing activities:

 

 

 

 

 

 

Purchases of property and equipment

 

 

(1,320

)

 

 

(384

)

Proceeds from sale and maturities of available-for-sale securities

 

 

92,156

 

 

 

 

Purchases of available-for-sale securities

 

 

(112,688

)

 

 

(48,368

)

Net cash used in investing activities

 

 

(21,852

)

 

 

(48,752

)

Cash flows from financing activities:

 

 

 

 

 

 

Proceeds from issuance of common stock, net of issuance costs

 

 

 

 

 

134,878

 

Proceeds from exercise of warrants

 

 

22

 

 

 

 

Employee stock purchases and withholding

 

 

73

 

 

 

 

Proceeds from exercise of stock options

 

 

 

 

 

38

 

Net cash provided by financing activities

 

 

95

 

 

 

134,916

 

Net (decrease) increase in cash, cash equivalents and restricted cash

 

 

(64,825

)

 

 

47,698

 

Cash, cash equivalents, and restricted cash at beginning of period