10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

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 000-51122

 

EyePoint Pharmaceuticals, Inc.

(Exact name of registrant as specified in its charter)

 

Delaware

(State or other jurisdiction of

incorporation or organization)

 

26-2774444

(I.R.S. Employer

Identification No.)

 

 

 

480 Pleasant Street

Watertown, MA

(Address of principal executive offices)

 

02472

(Zip Code)

(617) 926-5000

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

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, par value $0.001

EYPT

The Nasdaq Stock Market LLC

 

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, 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

 

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

There were 34,071,899 shares of the registrant’s common stock, $0.001 par value, outstanding as of August 1, 2022.

 

 

 


 

 

 

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

INDEX TO FORM 10-Q

 

 

 

 

 

Page

PART I. FINANCIAL INFORMATION

 

 

 

 

 

 

 

Item 1.

 

Unaudited Financial Statements

 

 

 

 

 

 

 

 

 

Condensed Consolidated Balance Sheets – June 30, 2022 and December 31, 2021

 

3

 

 

 

 

 

 

 

Condensed Consolidated Statements of Operations and Comprehensive Loss – Three and six months ended June 30, 2022 and 2021

 

4

 

 

 

 

 

 

 

Condensed Consolidated Statements of Stockholders’ Equity – Three and six months ended June 30, 2022 and 2021

 

5

 

 

 

 

 

 

 

Condensed Consolidated Statements of Cash Flows – Six months ended June 30, 2022 and 2021

 

6

 

 

 

 

 

 

 

Notes to Condensed Consolidated Financial Statements

 

7

 

 

 

 

 

Item 2.

 

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

 

25

 

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures about Market Risk

 

34

 

 

 

 

 

Item 4.

 

Controls and Procedures

 

34

 

 

 

 

 

PART II: OTHER INFORMATION

 

 

 

 

 

 

 

Item 1.

 

Legal Proceedings

 

35

 

 

 

 

 

Item 1A.

 

Risk Factors

 

35

 

 

 

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

37

 

 

 

 

 

Item 3.

 

Defaults Upon Senior Securities

 

37

 

 

 

 

 

Item 4.

 

Mine Safety Disclosures

 

37

 

 

 

 

 

Item 5.

 

Other Information

 

38

 

 

 

 

 

Item 6.

 

Exhibits

 

39

 

 

 

 

 

Signatures

 

41

 

 

 

 

 

Certifications

 

 

 

2


 

 

PART I. FINANCIAL INFORMATION

Item 1. Unaudited Financial Statements

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands except share data)

 

 

 

June 30,

 

 

December 31,

 

 

 

2022

 

 

2021

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

82,134

 

 

$

178,593

 

Marketable securities

 

 

89,033

 

 

 

32,965

 

Accounts and other receivables, net

 

 

22,594

 

 

 

18,354

 

Prepaid expenses and other current assets

 

 

8,851

 

 

 

4,217

 

Inventory

 

 

3,254

 

 

 

3,616

 

Total current assets

 

 

205,866

 

 

 

237,745

 

Property and equipment, net

 

 

1,111

 

 

 

476

 

Operating lease right-of-use assets

 

 

4,787

 

 

 

2,252

 

Intangible assets, net

 

 

21,519

 

 

 

22,749

 

Restricted cash

 

 

150

 

 

 

150

 

Total assets

 

$

233,433

 

 

$

263,372

 

Liabilities and stockholders' equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

7,058

 

 

$

7,385

 

Accrued expenses

 

 

14,312

 

 

 

14,422

 

Deferred revenue

 

 

1,137

 

 

 

1,069

 

Short-term borrowings

 

 

10,475

 

 

 

 

Other current liabilities

 

 

408

 

 

 

782

 

Total current liabilities

 

 

33,390

 

 

 

23,658

 

Long-term debt

 

 

29,181

 

 

 

36,562

 

Deferred revenue – noncurrent

 

 

14,070

 

 

 

14,560

 

Operating lease liabilities – noncurrent

 

 

4,826

 

 

 

1,860

 

Other long-term liabilities

 

 

600

 

 

 

2,352

 

Total liabilities

 

 

82,067

 

 

 

78,992

 

Contingencies (Note 13)

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

Preferred stock, $.001 par value, 5,000,000 shares authorized, no shares
   issued and outstanding

 

 

 

 

 

 

Common stock, $.001 par value, 300,000,000 shares authorized at June 30, 2022 and December 31, 2021; 34,052,616 and 33,905,826 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively

 

 

34

 

 

 

34

 

Additional paid-in capital

 

 

760,209

 

 

 

752,602

 

Accumulated deficit

 

 

(609,479

)

 

 

(569,097

)

Accumulated other comprehensive income

 

 

602

 

 

 

841

 

Total stockholders' equity

 

 

151,366

 

 

 

184,380

 

Total liabilities and stockholders' equity

 

$

233,433

 

 

$

263,372

 

 

See notes to condensed consolidated financial statements.

3


 

 

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

(In thousands except per share data)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30,

 

 

June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Product sales, net

 

$

11,318

 

 

$

8,738

 

 

$

20,328

 

 

$

15,540

 

License and collaboration agreements

 

 

49

 

 

 

94

 

 

 

108

 

 

 

435

 

Royalty income

 

 

198

 

 

 

181

 

 

 

423

 

 

 

361

 

Total revenues

 

 

11,565

 

 

 

9,013

 

 

 

20,859

 

 

 

16,336

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales, excluding amortization of acquired intangible assets

 

 

1,734

 

 

 

1,929

 

 

 

3,511

 

 

 

3,319

 

Research and development

 

 

12,992

 

 

 

5,605

 

 

 

22,937

 

 

 

11,084

 

Sales and marketing

 

 

6,883

 

 

 

6,659

 

 

 

13,576

 

 

 

12,318

 

General and administrative

 

 

8,557

 

 

 

5,184

 

 

 

17,106

 

 

 

10,299

 

Amortization of acquired intangible assets

 

 

615

 

 

 

615

 

 

 

1,230

 

 

 

1,230

 

Total operating expenses

 

 

30,781

 

 

 

19,992

 

 

 

58,360

 

 

 

38,250

 

Loss from operations

 

 

(19,216

)

 

 

(10,979

)

 

 

(37,501

)

 

 

(21,914

)

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

Interest and other income, net

 

 

362

 

 

 

280

 

 

 

423

 

 

 

281

 

Interest expense

 

 

(552

)

 

 

(1,376

)

 

 

(1,745

)

 

 

(2,722

)

Gain (loss) on extinguishment of debt

 

 

 

 

 

2,065

 

 

 

(1,559

)

 

 

2,065

 

Total other income (expense), net

 

 

(190

)

 

 

969

 

 

 

(2,881

)

 

 

(376

)

Net loss

 

$

(19,406

)

 

$

(10,010

)

 

$

(40,382

)

 

$

(22,290

)

Net loss per share - basic and diluted

 

$

(0.52

)

 

$

(0.35

)

 

$

(1.08

)

 

$

(0.83

)

Weighted average shares outstanding - basic and diluted

 

 

37,322

 

 

 

28,744

 

 

 

37,288

 

 

 

26,750

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(19,406

)

 

$

(10,010

)

 

$

(40,382

)

 

$

(22,290

)

Other comprehensive loss:

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized loss on available-for-sale securities, net of tax of $0 for periods presented

 

 

(186

)

 

 

 

 

 

(239

)

 

 

 

Comprehensive loss

 

$

(19,592

)

 

$

(10,010

)

 

$

(40,621

)

 

$

(22,290

)

 

See notes to condensed consolidated financial statements.

4


 

 

EYEPOINT PHARMACEUTICALS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

(In thousands except share data)

 

 

Common Stock

 

 

Additional

 

 

 

 

 

Accumulated
Other

 

 

Total

 

 

Number of
Shares

 

 

Par Value
Amount

 

 

Paid-In
Capital

 

 

Accumulated
Deficit

 

 

Comprehensive
Income

 

 

Stockholders’
Equity

 

Balance at April 1, 2021

 

28,741,475

 

 

$

29

 

 

$

637,797

 

 

$

(522,960

)

 

$

841

 

 

$

115,707

 

Net loss

 

 

 

 

 

 

 

 

 

 

(10,010

)

 

 

 

 

 

(10,010

)

Vesting of stock units

 

12,717

 

 

 

 

 

 

(12

)

 

 

 

 

 

 

 

 

(12

)

Stock-based compensation

 

 

 

 

 

 

 

1,180

 

 

 

 

 

 

 

 

 

1,180

 

Balance at June 30, 2021

 

28,754,192

 

 

$

29

 

 

$

638,965

 

 

$

(532,970

)

 

$

841

 

 

$

106,865

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at April 1, 2022

 

34,047,128

 

 

$

34

 

 

$

756,070

 

 

$

(590,073

)

 

$

788

 

 

$

166,819

 

Net loss

 

 

 

 

 

 

 

 

 

 

(19,406

)

 

 

 

 

 

(19,406

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

(186

)

 

 

(186

)

Issuance of stock, net of issue costs

 

 

 

 

 

 

 

20

 

 

 

 

 

 

 

 

 

20

 

Employee stock purchase plan

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercise of stock options

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vesting of stock units

 

5,488

 

 

 

 

 

 

(21

)

 

 

 

 

 

 

 

 

(21

)

Stock-based compensation

 

 

 

 

 

 

 

4,140

 

 

 

 

 

 

 

 

 

4,140

 

Balance at June 30, 2022

 

34,052,616

 

 

$

34

 

 

$

760,209

 

 

$

(609,479

)

 

$

602

 

 

$

151,366

 

 

 

Common Stock

 

 

Additional

 

 

 

 

 

Accumulated
Other

 

 

Total

 

 

Number of
Shares

 

 

Par Value
Amount

 

 

Paid-In
Capital

 

 

Accumulated
Deficit

 

 

Comprehensive
Income

 

 

Stockholders’
Equity

 

Balance at January 1, 2021

 

18,139,981

 

 

$

18

 

 

$

528,362

 

 

$

(510,680

)

 

$

841

 

 

$

18,541

 

Net loss

 

 

 

 

 

 

 

 

 

 

(22,290

)

 

 

 

 

 

(22,290

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of stock, net of issue costs

 

10,513,538

 

 

 

11

 

 

 

108,392

 

 

 

 

 

 

 

 

 

108,403

 

Employee stock purchase plan

 

27,713

 

 

 

 

 

 

173

 

 

 

 

 

 

 

 

 

173

 

Exercise of stock options

 

827

 

 

 

 

 

 

10

 

 

 

 

 

 

 

 

 

10

 

Vesting of stock units

 

72,133

 

 

 

 

 

 

(140

)

 

 

 

 

 

 

 

 

(140

)

Stock-based compensation

 

 

 

 

 

 

 

2,168

 

 

 

 

 

 

 

 

 

2,168

 

Balance at June 30, 2021

 

28,754,192

 

 

$

29

 

 

$

638,965

 

 

$

(532,970

)

 

$

841

 

 

$

106,865

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at January 1, 2022

 

33,905,826

 

 

$

34

 

 

$

752,602

 

 

$

(569,097

)

 

$

841

 

 

$

184,380

 

Net loss

 

 

 

 

 

 

 

 

 

 

(40,382

)

 

 

 

 

 

(40,382

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

(239

)

 

 

(239

)

Issuance of stock, net of issue costs

 

 

 

 

 

 

 

20

 

 

 

 

 

 

 

 

 

20

 

Employee stock purchase plan

 

28,504

 

 

 

 

 

 

201

 

 

 

 

 

 

 

 

 

201

 

Exercise of stock options

 

4,223

 

 

 

 

 

 

40

 

 

 

 

 

 

 

 

 

40

 

Vesting of stock units

 

114,063

 

 

 

 

 

 

(271

)