UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For
the quarterly period ended
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:
(Exact Name of Registrant as Specified in its Charter)
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s
telephone number, including area code:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| The
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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.
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).
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 | ☐ | |
| ☒ | 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 ☐
As of August 11, 2022, the registrant had shares of common stock, $0.0001 par value per share, outstanding.
Table of Contents
| 2 |
SUMMARY OF THE MATERIAL AND OTHER RISKS ASSOCIATED WITH OUR BUSINESS
Our business is subject to numerous material and other risks and uncertainties that you should be aware of in evaluating our business. These risks include, but are not limited to, the following:
| ● | We are a clinical-stage biopharmaceutical company with a limited operating history. | |
| ● | We have incurred significant operating losses since our inception and anticipate that we will continue to incur losses for the foreseeable future. We may never achieve or maintain profitability. | |
| ● | We have no products approved for commercial sale and have not generated any revenue from product sales. | |
| ● | Our business is entirely dependent on the successful development, regulatory approval and commercialization of AV-101, our only product candidate under development. | |
| ● | The ongoing COVID-19 pandemic, or a similar pandemic, epidemic, or outbreak of an infectious disease, may materially and adversely affect our business and our financial results and could cause a disruption to the development of AV-101. As a result of medical complications associated with pulmonary arterial hypertension (PAH), the patient populations that AV-101 targets may be particularly susceptible to COVID-19, which may make it more difficult for us to identify patients able to enroll in our current and future clinical trials and may impact the ability of enrolled patients to complete any such trials. | |
| ● | We are conducting our first late-stage clinical trial of AV-101, a dry powder formulation of imatinib for the treatment of PAH administered using a dry powder inhaler, to assess its safety and tolerability. Although we believe that AV-101 has therapeutic potential for PAH based on oral imatinib’s results in the Phase 3 IMPRES trial, we are utilizing a novel dry powder formulation which may not achieve better or similar levels of clinical activity or may have similar tolerability challenges as oral imatinib. The results of earlier studies and trials of oral imatinib in pulmonary arterial hypertension, or PAH, patients and our Phase 1 clinical trial of AV-101 may not be predictive of future trial results for AV-101. | |
| ● | If we encounter difficulties with site initiation and patient enrollment in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected. | |
| ● | We face, and will continue to face, significant competition and our failure to effectively compete may prevent us from achieving significant market penetration for AV-101, if approved. Most of our competitors have significantly greater resources than we do and we may not be able to successfully compete. | |
| ● | We rely, and intend to continue to rely, on qualified third parties to supply all components of AV-101. As a result, we are dependent on several third parties, some of which are sole source suppliers, for the manufacture of AV-101 and our supply chain, and if we experience problems with any of these suppliers, or they fail to comply with applicable regulatory requirements or to supply sufficient quantities at acceptable quality levels or prices, or at all, it would materially and adversely affect our business. | |
| ● | We rely, and intend to continue to rely, on third parties in the conduct of all of our clinical trials. If these third parties do not successfully carry out their contractual duties, fail to comply with applicable regulatory requirements or meet expected deadlines, we may be unable to obtain regulatory approval for AV-101. | |
| ● | We have two issued U.S. patents and many pending patent applications with respect to AV-101 (of which two have recently received a notice of allowance). We can provide no assurance that any of our other current or future patent applications will result in issued patents. If we cannot protect our patent rights or our other proprietary rights, others may develop products similar or identical to ours, and we may not be able to compete effectively in our market or successfully commercialize any product candidates we may develop. | |
| ● | We may be unable to obtain regulatory approval for AV-101 under applicable regulatory requirements. The denial or delay of any such approval would delay commercialization of AV-101 and adversely impact our potential to generate revenue, our business and our results of operations. | |
| ● | AV-101 is a drug-device combination product, which may result in additional regulatory risks. | |
| ● | We plan to conduct clinical trials for AV-101 outside the United States, and the U.S. Food and Drug Administration, European Medicines Agency, and applicable foreign regulatory authorities may not accept data from such trials. | |
| ● | We will need to increase the size of our organization, and we may experience difficulties in managing growth. | |
| ● | We are highly dependent on our key personnel and anticipate hiring new key personnel. If we are not successful in attracting and retaining highly qualified personnel, our business may be materially and adversely affected. | |
| ● | Unfavorable global economic or political conditions could adversely affect our business, financial condition or results of operations. |
| 3 |
The material and other risks summarized above should be read together with the text of the full risk factors below and in the other information set forth in this Quarterly Report on Form 10-Q, including our condensed consolidated financial statements and the related notes, as well as in other documents that we file with the U.S. Securities and Exchange Commission (“SEC”). If any such material and other risks and uncertainties actually occur, our business, prospects, financial condition and results of operations could be materially and adversely affected. The risks summarized above or described in full under Item 1A of this Quarterly Report on Form 10-Q are not the only risks that we face. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial may also materially adversely affect our business, prospects, financial condition and results of operations.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains express or implied forward-looking statements that are based on our management’s belief and assumptions and on information currently available to our management. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements relate to future events or our future operational or financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:
| ● | the initiation, timing, progress, results and cost of our research and development program for AV-101 and our current and future clinical trials, including statements regarding the timing of initiation and completion of studies or trials and related preparatory work and the period during which the results of the trials will become available; | |
| ● | our expectations regarding the potential market size and size of the potential patient populations for AV-101, if approved for commercial use; | |
| ● | our clinical and regulatory development plans; | |
| ● | our expectations with regard to the data to be derived from our planned Phase 2b/Phase 3 clinical trial; or any other product candidates that we may identify or develop; | |
| ● | the timing or likelihood of regulatory filings and approvals for AV-101; | |
| ● | our ability to commercialize AV-101, if approved; | |
| ● | the pricing and reimbursement of AV-101, if approved; | |
| ● | the implementation of our business model and strategic plans for our business and AV-101; | |
| ● | estimates of our future expenses, revenues, capital requirements and our needs for additional financing, and our ability to obtain additional capital; | |
| ● | the scope of protection we are able to establish and maintain for intellectual property rights covering AV-101, including the projected terms of patent protection; | |
| ● | regulatory developments in the United States and foreign countries; | |
| ● | our ability to enter into strategic collaborations, including for the commercialization of AV 101 outside the United States; | |
| ● | the rate and degree of market acceptance of AV 101; | |
| ● | our ability to contract with third-party suppliers, manufacturers and contract research organizations, or CROs, and their ability to perform adequately; |
| 4 |
| ● | the success of competing therapies for PAH that are or may become available; | |
| ● | developments relating to our competitors and our industry, including the impact of government regulation; | |
| ● | our ability to attract and retain key scientific or management personnel; | |
| ● | our ability to obtain additional funding for our operations, when needed, including funding necessary to complete further development and commercialization of AV-101, if approved; | |
| ● | our financial performance; | |
| ● | the effect of the ongoing COVID-19 pandemic, including mitigation efforts and economic effects, on any of the foregoing or other aspects of our business operations, including but not limited to our clinical trials and any future studies or trials; and | |
| ● | other risks and uncertainties, including those listed under the section titled “Risk Factors.” |
In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue” or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors, which are, in some cases, beyond our control and which could materially affect results. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. If one or more of these risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee of future performance. You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed with the SEC thereto completely and with the understanding that our actual future results may be materially different from any future results expressed or implied by these forward-looking statements.
The forward-looking statements in this Quarterly Report on Form 10-Q represent our views as of the date of this Quarterly Report on Form 10-Q. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required by applicable law. You should therefore not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this Quarterly Report on Form 10-Q.
This Quarterly Report on Form 10-Q also contains estimates, projections and other information concerning our industry, our business and the markets for our product candidates. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. Unless otherwise expressly stated, we obtained this industry, business, market, and other data from our own internal estimates and research as well as from reports, research surveys, studies, and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data and similar sources. While we are not aware of any misstatements regarding any third-party information presented in this Quarterly Report on Form 10-Q, their estimates, in particular, as they relate to projections, involve numerous assumptions, are subject to risks and uncertainties and are subject to change based on various factors, including those discussed under the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q.
| 5 |
PART I-FINANCIAL INFORMATION
Item 1. Financial Statements.
Aerovate Therapeutics, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands, except share and per share amounts)
| June 30, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Short-term investments | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | ||||||||
| Operating lease right-of-use asset | ||||||||
| Other long-term assets | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | $ | ||||||
| Accrued and other current liabilities | ||||||||
| Operating lease liability | ||||||||
| Total current liabilities | ||||||||
| Operating lease liabilities, net of current portion | ||||||||
| Other liabilities | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies (Note 5) | ||||||||
| Stockholders’ equity: | ||||||||
| Preferred stock, $ par value; shares authorized as of June 30, 2022 and December 31, 2021, respectively; shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively | ||||||||
| Common stock, $ par value; shares authorized at June 30, 2022 and December 31, 2021, respectively; and shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Total stockholders’ equity | ||||||||
| Total liabilities and stockholders’ equity | $ | $ | ||||||
See accompanying notes to unaudited interim condensed consolidated financial statements.
| 6 |
Aerovate Therapeutics, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited)
(in thousands, except share and per share amounts)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | $ | $ | $ | $ | ||||||||||||
| General and administrative | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Loss from operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Interest income | ||||||||||||||||
| Other expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total other income (expense) | ( | ) | ( | ) | ||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Comprehensive loss: | ||||||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Other comprehensive loss: | ||||||||||||||||
| Unrealized loss on securities | ( | ) | ( | ) | ||||||||||||
| Comprehensive loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Net loss per share, basic and diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Weighted-average shares of common stock outstanding, basic and diluted | ||||||||||||||||
See accompanying notes to unaudited interim condensed consolidated financial statements.
| 7 |
Aerovate Therapeutics, Inc.
Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)
(Unaudited)
(in thousands, except share amounts)
| Series A Redeemable | Series Seed Redeemable | Accumulated | Total | |||||||||||||||||||||||||||||||||||||
| Convertible Preferred Stock | Convertible Preferred Stock | Common Stock | Additional Paid-In | Other Comprehensive | Accumulated | Stockholders’ Equity | ||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Loss | Deficit | (Deficit) | |||||||||||||||||||||||||||||||
| Balance at December 31, 2021 | $ | $ | $ | 2 | $ | 208,867 | $ | (59 | ) | $ | (36,392 | ) | $ | 172,418 | ||||||||||||||||||||||||||
| Unrealized loss on investments | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Stock based compensation | — | — | — | |||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Balance at March 31, 2022 | $ | $ | $ | 2 | $ | 209,891 | $ | (644 | ) | $ | (47,302 | ) | $ | 161,947 | ||||||||||||||||||||||||||
| Unrealized loss on investments | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Stock based compensation | — | — | — | |||||||||||||||||||||||||||||||||||||
| Issuance of common stock upon exercise of stock options | — | — | 8,041 | |||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Balance at June 30, 2022 | $ | $ | $ | 2 | $ | 211,129 | $ | (785 | ) | $ | (59,293 | ) | $ | 151,053 | ||||||||||||||||||||||||||
| Series A Redeemable | Series Seed Redeemable | Accumulated | Total | |||||||||||||||||||||||||||||||||||||
| Convertible Preferred Stock | Convertible Preferred Stock | Common Stock | Additional Paid-In | Other Comprehensive | Accumulated | Stockholders’ Equity | ||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Loss | Deficit | (Deficit) | |||||||||||||||||||||||||||||||
| Balance at December 31, 2020 | $ | $ | $ | — | $ | 63 | $ | — | $ | (13,407 | ) | $ | (13,344 | ) | ||||||||||||||||||||||||||
| Issuance of Series A redeemable convertible preferred stock at $ per share, net of issuance costs of $ | — | |||||||||||||||||||||||||||||||||||||||
| Accretion of Series A redeemable convertible preferred stock to redemption value | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Stock based compensation | — | — | — | |||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Balance at March 31, 2021 | $ | $ | $ | — | $ | 86 | $ | — | $ | (16,201 | ) | $ | (16,115 | ) | ||||||||||||||||||||||||||
| Issuance of Series A redeemable convertible preferred stock at $ per share, net of issuance costs of $ | — | — | ||||||||||||||||||||||||||||||||||||||
| Accretion of Series A redeemable convertible preferred stock to redemption value | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Stock based compensation | — | — | — | |||||||||||||||||||||||||||||||||||||
| Net loss | — | — | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||
| Balance at June 30, 2021 | $ | $ | $ | — | $ | 407 | $ | — | $ | (21,985 | ) | $ | (21,578 | ) | ||||||||||||||||||||||||||
See accompanying notes to unaudited interim condensed consolidated financial statements.
| 8 |
Aerovate Therapeutics, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
| Six months ended June 30, | ||||||||
| 2022 | 2021 | |||||||
| Cash flow from operating activities: | ||||||||
| Net loss | $ | ( |
) | $ | ( |
) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Stock-based compensation expense | ||||||||
| Depreciation and amortization expense | ||||||||
| Accretion of discounts and amortization of premiums on investments, net | ( |
) | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid expenses and other current assets | ( |
) | ||||||
| Other long-term assets | ( |
) | ( |
) | ||||
| Accounts payable | ||||||||
| Accrued and other liabilities | ( |
) | ||||||
| Operating lease assets and liabilities, net | ( |
) | ||||||
| Net cash used in operating activities | ( |
) | ( |
) | ||||
| Cash flow from investing activities: | ||||||||
| Purchases of short-term investments | ( |
) | ||||||
| Sales and maturities of short-term investments | ||||||||
| Purchases of property and equipment | ( |
) | ( |
) | ||||
| Net cash used in investing activities | ( |
) | ( |
) | ||||
| Cash flow from financing activities: | ||||||||
| Proceeds from sale of Series A redeemable convertible preferred stock, net of issuance costs | ||||||||
| Payments for deferred offering costs | ( |
) | ||||||
| Proceeds from issuance of common stock upon exercise of stock options | ||||||||
| Net cash provided by financing activities | ||||||||
| Net (decrease) increase in cash | ( |
) | ||||||
| Cash and cash equivalents at the beginning of the year | ||||||||
| Cash and cash equivalents at the end of the period | $ | $ | ||||||
| Supplemental disclosure of noncash investing and financing activities: | ||||||||
| Right-of-use asset obtained in exchange for operating lease liability | $ | $ | ||||||
| Deferred offering costs included in accounts payable | $ | $ | ||||||
See accompanying notes to unaudited interim condensed consolidated financial statements.
| 9 |
AEROVATE THERAPEUTICS, INC.
NOTES TO UNAUDITED INTERIM CONDENSED consolidated FINANCIAL STATEMENTS
(1) ORGANIZATION AND NATURE OF OPERATIONS
(a) Organization and Nature of Operations
Aerovate Therapeutics Inc. (“Aerovate” or the “Company”) was incorporated in the state of Delaware in July 2018, and is headquartered in Waltham, Massachusetts. The Company has a wholly owned subsidiary, Aerovate Securities Corporation. The Company is a clinical stage biopharmaceutical company that is focused on the development of drugs that meaningfully improve the lives of patients with rare cardiopulmonary disease. The Company’s initial focus is on advancing AV-101, the Company’s dry powder inhaled formulation of imatinib for the treatment of pulmonary arterial hypertension (“PAH”). The Company initiated a Phase 2b/Phase 3 trial of AV-101 in PAH patients in December 2021.
(b) Liquidity and Management Plans
Since
inception, the Company has devoted substantially all of its resources to research and development activities, business planning, establishing
and maintaining its intellectual property portfolio, hiring personnel, raising capital, and providing general and administrative support
for these operations and has not realized revenues from its planned principal operations. The Company has incurred losses and negative
cash flows from operations since inception. In addition, the Company expects to incur substantial operating losses for the next several
years as it continues its research and development activities. As of June 30, 2022, the Company had cash and cash equivalents and short-term
investments of $
Management plans to continue to incur substantial costs in order to conduct research and development activities and additional capital will be needed to undertake these activities. The Company intends to raise such capital through debt or equity financings or other arrangements to fund operations. Management believes that the Company’s current cash and cash equivalents and short-term investments will provide sufficient funds to enable the Company to meet its obligations for at least twelve months from the filing date of this report.
(2) BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of Presentation
The accompanying unaudited condensed consolidated financial statements as of June 30, 2022 and for the three and six months ended June 30, 2022 and 2021 have been prepared in conformity with generally accepted accounting principles (“GAAP”) in the United States of America for interim financial information and pursuant to Article 10 of Regulation S-X of the Securities Act of 1933, as amended (the Securities Act). Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. These unaudited condensed consolidated financial statements include only normal and recurring adjustments that the Company believes are necessary to fairly state the Company’s financial position and the results of its operations and cash flows.
The results for the three and six months ended June 30, 2022 are not necessarily indicative of the results expected for the full fiscal year or any subsequent interim period. The condensed consolidated balance sheet as of December 31, 2021 has been derived from the audited financial statements at that date but does not include all disclosures required by GAAP for complete financial statements. Because all of the disclosures required by GAAP for complete financial statements are not included herein, these unaudited condensed consolidated financial statements and the notes accompanying them should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2021. Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).
| 10 |
(b) Reverse Stock Split
On
June 22, 2021, the Company effected a
(c) Use of Estimates
The preparation of the Company’s consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of expenses during the reporting period. Reported amounts and note disclosures reflect the overall economic conditions that are most likely to occur and anticipated measures management intends to take. The full extent to which the COVID-19 pandemic will directly or indirectly impact our business, results of operations, and financial condition will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain or treat it, as well as the economic impact on local, regional, national and international markets. Actual results could differ materially from those estimates. Accounting estimates and management judgements reflected in the consolidated financial statements include: normal recurring accruals, including the accrual for research and development expenses, stock-based compensation and fair value of investments. Estimates and assumptions are reviewed quarterly. Any revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.
Basic net loss per share is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding for the period, without consideration of potential dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the sum of the weighted average number of common shares plus the potential dilutive effects of potential dilutive securities outstanding during the period. Potential dilutive securities are excluded from diluted earnings or loss per share if the effect of such inclusion is antidilutive. The Company’s potentially dilutive securities, which include convertible preferred stock prior to the conversion of such shares to common stock and outstanding stock options under the Company’s equity incentive plan, have been excluded from the computation of diluted net loss per share as they would be anti-dilutive to the net loss per share. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position.
| 11 |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Numerator: | ||||||||||||||||
| Net loss | $ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
| Accretion of Series A redeemable convertible preferred stock to redemption value | ( |
) | ( |
) | ||||||||||||
| Net loss available to common stockholders | $ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
| Denominator: | ||||||||||||||||
| Weighted-average common stock outstanding, basic and diluted | ||||||||||||||||
| Net loss per share, basic and diluted | $ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
| As of June 30, | ||||||||
| 2022 | 2021 | |||||||
| Options to purchase common stock | ||||||||
| Unvested restricted stock units | ||||||||
| Series Seed redeemable convertible preferred stock | ||||||||
| Series A redeemable convertible preferred stock | ||||||||
(e) Recently Issued and Recently Adopted Accounting Pronouncements
From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies that are adopted by the Company as of the specified effective date. The Company has evaluated recently issued accounting pronouncements and does not believe any will have a material impact on the Company’s condensed consolidated financial statements or related financial statement disclosures.
(3) FAIR VALUE OF FINANCIAL INSTRUMENTS
The following tables summarize the Company’s financial assets measured at fair value on a recurring basis and their respective input levels based on the fair value hierarchy (in thousands):
| Fair Value Measurements Using | ||||||||||||||||
| June 30, 2022 | Quoted Prices in Active Markets for Identical Assets (Level 1) |
Significant Other Observable Inputs (Level 2) | Significant
Unobservable (level 3) |
|||||||||||||
| Assets: | ||||||||||||||||
| Cash equivalents | ||||||||||||||||
| Money market funds | $ | $ | $ | $ | ||||||||||||
| Commercial paper | ||||||||||||||||
| Total cash equivalents | ||||||||||||||||
| Short-term investments | ||||||||||||||||
| U.S. Treasury bills | ||||||||||||||||
| Corporate debt securities | ||||||||||||||||
| Commercial paper | ||||||||||||||||
| Agency bond | ||||||||||||||||
| Total short-term investments | ||||||||||||||||
| Total fair value of assets | $ | $ | $ | $ | ||||||||||||
| 12 |
| Fair Value Measurements Using | ||||||||||||||||
| December 31, 2021 | Quoted
Prices in Active Markets for Identical Assets (Level 1) |
Significant
Other Observable Inputs (Level 2) |
Significant Unobservable Inputs (level 3) |
|||||||||||||
| Assets: | ||||||||||||||||
| Cash equivalents | ||||||||||||||||
| Money market funds | $ | $ | $ | $ | ||||||||||||
| Commercial paper | ||||||||||||||||
| Total cash equivalents | ||||||||||||||||
| Short-term investments | ||||||||||||||||
| U.S. Treasury bills | ||||||||||||||||
| Corporate debt securities | ||||||||||||||||
| Commercial paper | ||||||||||||||||
| Total short-term investments | ||||||||||||||||
| Total fair value of assets | $ | $ | $ | $ | ||||||||||||
Cash Equivalents and Short-Term Investments
Financial assets measured at fair value on a recurring basis consist of the Company’s cash equivalents and short-term investments. Cash equivalents consisted of money market funds and commercial paper, and short-term investments consisted of U.S. Treasury bills, corporate debt securities and commercial paper. The Company obtains pricing information from its investment manager and generally determines the fair value of investment securities using standard observable inputs, including reported trades, broker/dealer quotes, and bids and/or offers.
The following tables summarize the Company’s short-term investments (in thousands):
| As of June 30, 2022 | ||||||||||||||||||
| Maturity | Amortized cost | Gross
unrealized gains |
Gross unrealized losses |
Estimated
fair value |
||||||||||||||
| Corporate debt securities | |
$ | $ | $ | ( |
) | $ | |||||||||||
| Commercial paper | |
( |
) | |||||||||||||||
| U.S. Treasury bills | |
( |
) | |||||||||||||||
| Agency bond | |
( |
) | |||||||||||||||
| $ | $ | $ | ( |
) | $ | |||||||||||||
| As of December 31, 2021 | ||||||||||||||||||
| Maturity | Amortized cost | Gross
unrealized gains |
Gross
unrealized losses |
Estimated
fair value |
||||||||||||||
| Corporate debt securities | $ | $ | $ | ( |
) | $ | ||||||||||||
| Commercial paper | ( |
) | ||||||||||||||||
| U.S. Treasury bills | ( |
) | ||||||||||||||||
| $ | $ | $ | ( |
) | $ | |||||||||||||
| 13 |
The
Company considers whether unrealized losses have resulted from a credit loss or other factors. The unrealized losses on the Company’s
available-for-sale securities as of June 30, 2022 and December 31, 2021 were caused by fluctuations in market value and interest rates
as a result of the economic environment and not credit risk. As of June 30, 2022 and December 31, 2021, no allowance for credit losses
was recorded. During the six months ended June 30, 2022, the Company did not recognize any impairment losses related to its short-term
investments. It is neither management’s intention to sell nor is it more likely than not that the Company will be required to sell
these investments prior to recovery of their cost basis or recovery of fair value. Unrealized gains and losses are included in accumulated
other comprehensive loss. The Company excludes accrued interest from both the fair value and the amortized cost basis of the available-for-sale
debt securities for the purposes of identifying and measuring an impairment and to not measure an allowance for expected credit losses
for accrued interest receivables. Accrued interest receivable is written off through net realized investment gains (losses) at the time
the issuer of the bond defaults or is expected to default on payment. It is the Company’s policy to present the accrued interest
receivable balance as part of prepaid expenses and other current assets in the balance sheets. Accrued interest receivable related to
short-term investments was $
(4) BALANCE SHEET COMPONENTS
Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consisted of the following (in thousands):
| June 30, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Prepaid research and development | $ | $ | ||||||
| Prepaid expenses | ||||||||
| Other current assets | ||||||||
| Total prepaid expenses and other current assets | $ | $ | ||||||
Accrued and Other Current Liabilities
Accrued and other current liabilities consisted of the following (in thousands):
| June 30, | December 31, | |||||||
| 2022 | 2021 | |||||||
| Accrued payroll and other employee benefits | $ | $ | ||||||
| Accrued research and development | ||||||||
| Other | ||||||||
| Total accrued and other current liabilities | $ | $ | ||||||
(5) COMMITMENTS AND CONTINGENCIES
In
August 2021, the Company entered into a lease agreement (the “Waltham Lease”) for approximately
In
April 2022, the Company entered into a lease agreement (the “Foster City Lease”) for approximately
| 14 |
As of June 30, 2022, the future minimum annual lease payments under the operating leases were as follows (in thousands):
| 2022 | $ | |||
| 2023 | ||||
| 2024 | ||||
| 2025 | ||||
| Total operating lease payments | ||||
| Less: Amount representing interest | ( |
) | ||
| Present value of net minimum lease payments | $ | |||
| Operating lease liabilities: | ||||
| Current | ||||
| Non-current | ||||
| Total lease liabilities | $ | |||
| Weighted-average remaining lease term (in years) | ||||
| Weighted-average incremental borrowing rate | % |
Supplemental cash flow information related to cash paid for amounts included in the measurement of operating lease liabilities was as follows (in thousands):
| Six months ended June 30, | ||||||||
| 2021 | 2020 | |||||||
| Cash paid included in operating cash flows | $ | $ | ||||||
Rent expense was as follows (in thousands):
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Operating lease | $ | $ | $ | $ | ||||||||||||
| Short-term lease | ||||||||||||||||
| Total rent expense | $ | $ | $ | $ | ||||||||||||
(6) STOCKHOLDERS’ EQUITY
On July 2, 2021, the Company’s certificate of amendment to its certificate of incorporation became effective, which provided authorized shares of common stock with a par value of $ per share and authorized shares of undesignated preferred stock with a par value of $ per share.
In August 2018, the Company issued shares of common stock to RA Capital Healthcare Fund, L.P. at a price of $ per share. On July 2, 2021, in conjunction with the Company’s initial public offering, or IPO, the Company issued shares of its common stock and all outstanding shares of the Company’s redeemable convertible preferred stock were converted into shares of the Company’s common stock.
The holders of the common stock are entitled to one vote for each share of common stock held at all meetings of stockholders.
| 15 |
| June 30, 2022 | ||||
| Common stock options granted and outstanding | ||||
| Reserved for exercise of outstanding stock options | ||||
| Reserved for vesting of outstanding restricted stock units | ||||
| Reserved for future ESPP issuances | ||||
| Total | ||||
The Company’s 2021 Stock Option and Incentive Plan (the “2021 Plan”) was adopted by the Company’s board of directors and approved by the Company’s stockholders in June 2021 and became effective as of June 29, 2021. Upon the effectiveness of the 2021 Plan, the Company’s 2018 Equity Incentive Plan (the “2018 Plan”) was terminated and no further grants may be made thereunder. The Company’s 2021 Plan allows for the grant of incentive stock options, non-qualified stock options, stock appreciation rights, stock bonuses, restricted stock, stock units and other forms of awards including cash awards to its officers, directors, employees, consultants and advisors.
As of June 30, 2022, a total of shares of the Company’s common stock is authorized for issuance with respect to awards granted under the 2021 Plan. The share limit will automatically increase on the first trading day in January of each year (commencing with 2022) by an amount equal to the lesser of (1) % of the total number of outstanding shares of the Company’s common stock on the last trading day in December in the prior year, or (2) such lesser number as determined by the Company’s board of directors. Effective January 1, 2022, the number of shares available under the 2021 Plan increased by shares, as determined by the Company’s board of directors.
Any shares subject to awards granted under the 2021 Plan or the 2018 Plan that are not paid, delivered or exercised before they expire or are canceled or terminated, or otherwise fail to vest, as well as shares used to pay the purchase or exercise price of such awards or related tax withholding obligations, will become available for new award grants under the 2021 Plan.
As of June 30, 2022, options had been granted and restricted stock units had been awarded under the 2021 Plan, with shares authorized under the 2021 Plan available for future issuance. As of June 30, 2022, a total of options had been granted under the 2018 Plan.
The options that are granted under the 2021 Plan and the 2018 Plan are exercisable at various dates as determined upon grant and terminate within of the date of grant. The vesting period generally occurs over
| 16 |
| Options | Weighted- Average Exercise Price |
Weighted- Average Remaining Contractual Term (in years) |
Aggregate Intrinsic Value (in thousands) |
|||||||||||||
| Vested and expected to vest at December 31, 2021 | $ | $ | ||||||||||||||
| Granted | $ | |||||||||||||||
| Exercised | ( |
) | ||||||||||||||
| Cancelled/Forfeited | ||||||||||||||||
| Outstanding at June 30, 2022 | $ | $ | ||||||||||||||
| Vested and exercisable at June 30, 2022 | $ | $ | ||||||||||||||
| Vested and expected to vest at June 30, 2022 | $ | $ | ||||||||||||||
The weighted-average grant date fair value of stock option grants was $ per share for the six months ended June 30, 2022. All exercisable options are vested and all outstanding options are vested or expected to vest.
| (b) | Employee Stock Purchase Plan |
The Company’s Employee Stock Purchase Plan (the “ESPP”) was adopted by the Company’s board of directors and stockholders in June 2021 and became effective upon the consummation of the IPO. A total of shares of the Company’s common stock is initially available for issuance under the ESPP. The ESPP allows eligible employees to purchase shares of the Company’s common stock at a discount through payroll deductions of up to % of their eligible compensation, subject to any plan limitations. The ESPP provides for six-month offering periods, and at the end of each offering period, employees are able to purchase shares at % of the lower of the fair market value of the Company’s common stock on the first trading day of the offering period or on the last trading day of the offering period. As of June 30, 2022, shares had been issued under the ESPP, and the full number of shares authorized under the ESPP Plan was available for issuance purposes upon the effectiveness of the ESPP.
| (c) | Stock-Based Compensation Expense |
The Company estimated the fair value of stock options using the Black-Scholes valuation model. The Company accounts for any forfeitures of options when they occur. Previously recognized compensation expense for an award is reversed in the period that the award is forfeited. The fair value of stock options was estimated using the following assumptions:
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Expected term (in years) | - | - | - | - | ||||||||||||
| Expected volatility | - | % | - | % | - | % | - | % | ||||||||
| Risk-free interest rate | - | % | - | % | - | % | - | % | ||||||||
| Expected dividend | ||||||||||||||||
| 17 |
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Research and development | $ | $ | $ | $ | ||||||||||||
| General and administrative | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
As of June 30, 2022, there was approximately $ million of total unrecognized stock-based compensation expense related to nonvested stock-based compensation arrangements granted under the 2021 Plan and 2018 Plan, which is expected to be recognized over a weighted-average period of approximately years.
| (d) | Restricted Stock Units |
| Units | Weighted- Average Grant Date Fair Value Per Unit |
|||||||
| Unvested restricted stock units as of December 31, 2021 | ||||||||
| Granted | $ | |||||||
| Vested | ||||||||
| Forfeited | ||||||||
| Unvested restricted stock units as of June 30, 2022 | $ | |||||||
Stock-based compensation of restricted stock units is based on the fair value of the Company’s common stock on the date of grant and recognized over the vesting period. Restricted stock units awarded by the Company vest in equal amounts annually over .
As of June 30, 2022, the Company had unrecognized stock-based compensation expense related to its unvested restricted stock units of $, which is expected to be recognized over the remaining weighted-average vesting period ofyears.
| 18 |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q and with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission on March 30, 2022. This discussion contains forward-looking statements that reflect our plans, estimates and beliefs, and involve risks and uncertainties. Our actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements as a result of several factors, including those discussed in the section titled “Risk Factors” included under Part I, Item 1A and elsewhere in this Quarterly Report. See “Special Note Regarding Forward-Looking Statements” in this Quarterly Report.
Overview
We are a clinical stage biopharmaceutical company focused on developing drugs that meaningfully improve the lives of patients with rare cardiopulmonary disease. Our initial focus is on advancing AV-101, our dry powder inhaled formulation of imatinib for the treatment of pulmonary arterial hypertension, or PAH, a devastating disease impacting approximately 70,000 people in the United States and Europe. Imatinib, marketed as Gleevec tablets, was originally developed for the treatment of multiple cancers. Oral imatinib also demonstrated statistically significant improvement on the primary endpoint, six-minute walk distance, and multiple secondary hemodynamic endpoints in PAH patients in an international Phase 3 trial conducted by Novartis but was poorly tolerated due to adverse events, or AEs, and never was approved for the treatment of PAH. AV-101, delivered using a dry powder inhaler, is designed to provide lung concentrations at or above those observed with the oral dose while limiting systemic levels of the drug. We have completed a Phase 1 study in healthy volunteers and AV-101 was generally well-tolerated with no serious adverse events reported. We announced the initiation of Inhaled iMatinib Pulmonary Arterial Hypertension Clinical Trial (IMPAHCT), our Phase 2b/Phase 3 trial of AV-101 in PAH patients in December 2021, and we have assembled a team with deep expertise in developing innovative PAH and inhaled therapies and commercializing novel drugs.
We do not have any products approved for sale and have incurred significant operating losses since our inception and expect to continue to incur significant operating losses for the foreseeable future.
COVID-19 Pandemic
The global coronavirus disease 2019, or COVID-19, pandemic continues to evolve, and we will continue to monitor the COVID-19 situation. The extent of the impact of the ongoing COVID-19 pandemic and its variants on our business, operations and clinical development timelines, supply chain and plans remains uncertain, and will depend on certain developments, including the duration and spread of the outbreak, including the identification of new variants of the virus, and its impact on our clinical trial enrollment and trial sites, both of which could impact the timing of our release of trial data, contract research organizations, or CROs, third-party manufacturers, and other third parties with whom we do business, as well as its impact on regulatory authorities and our key scientific and management personnel. The ultimate impact of the ongoing COVID-19 pandemic or a similar health epidemic is highly uncertain and subject to change. To the extent possible, we are conducting business as usual, with only necessary or advisable modifications to employee travel.
We will continue to actively monitor the rapidly evolving situation related to COVID-19 and may take further actions that alter our operations, including those that may be required by federal, state or local authorities, or that we determine are in the best interests of our employees and other third parties with whom we do business. At this point, the extent to which the ongoing COVID-19 pandemic may affect our business, operations and clinical development timelines and plans, including the resulting impact on our expenditures and capital needs, remains uncertain and is subject to change.
| 19 |
Components of Results of Operations
Revenue
We currently have no products approved for sale, and we have not generated any revenue to date. In the future, we may generate revenue from collaboration or license agreements we may enter into with respect to our drug candidate, as well as product sales from any approved product, which approval we do not expect to occur for at least the next several years, if ever. Our ability to generate product revenue will depend on the successful development and eventual commercialization of AV-101 and any other drug candidates we may pursue. If we fail to complete the development of AV-101 in a timely manner, or to obtain regulatory approval, our ability to generate future revenue and our results of operations and financial position would be materially adversely affected.
Operating Expenses
Research and Development
To date, our research and development expenses have related to the development of AV-101. Research and development expenses are recognized as incurred and payments made prior to the receipt of goods or services to be used in research and development are capitalized until the goods or services are received.
Research and development expenses include:
| ● | external research and development expenses incurred under agreements with CROs and consultants to conduct and support clinical trials of AV-101 and our preclinical studies; | |
| ● | costs related to manufacturing AV-101 for use in clinical trials; and | |
| ● | personnel-related costs, including salaries, payroll taxes, employee benefits, and stock-based compensation charges for those individuals involved in research and development efforts. |
Our research and development expenses consist principally of direct costs, such as fees paid to CROs, investigative sites and consultants in connection with our clinical trials, preclinical and non-clinical studies, and costs related to manufacturing clinical trial materials. We deploy our personnel related resources across all of our research and development activities. We track direct expenses on a clinical and non-clinical basis.
We plan to substantially increase our research and development expenses for the foreseeable future as we continue the development of AV-101. We cannot determine with certainty the timing of initiation, the duration or the completion costs of current or future clinical trials and nonclinical studies of AV-101 or any future product candidates due to the inherently unpredictable nature of clinical and preclinical development. Clinical and preclinical development timelines, the probability of success and development costs can differ materially from expectations. We will need to raise substantial additional capital in the future.
Our future clinical development costs may vary significantly based on factors such as:
| ● | per patient trial costs; | |
| ● | the number of trials required for approval; | |
| ● | the number of sites included in the trials; | |
| ● | the countries in which the trials are conducted; | |
| ● | the length of time required to enroll eligible patients; | |
| ● | the number of patients that participate in the trials; |
| 20 |
| ● | the number of doses evaluated in the trials; | |
| ● | the drop-out or discontinuation rates of patients; | |
| ● | potential additional safety monitoring requested by regulatory agencies; | |
| ● | the duration of patient participation in the trials and follow-up; and | |
| ● | the efficacy and safety profile of the product candidate. |
General and Administrative
General and administrative expenses consist primarily of personnel-related costs, including salaries, payroll taxes, employee benefits, and stock-based compensation charges for those individuals in executive, finance and other administrative functions. Other significant costs include legal fees relating to intellectual property and corporate matters, professional fees for accounting and consulting services, and insurance costs. We anticipate that our general and administrative expenses will increase for the foreseeable future to support our continued research and development activities, pre-commercial preparation activities and commercialization activities for AV-101. We also anticipate increased expenses related to audit, legal, regulatory, and tax-related services associated with maintaining compliance with exchange listing and SEC requirements, director and officer insurance premiums, and investor relations costs associated with operating as a public company.
Interest Income
Interest income consists of interest earned on our cash and cash equivalents and short-term investments.
Results of Operations
Comparison of the Three Months Ended June 30, 2022 and 2021 (Unaudited)
The following table summarizes our results of operations for the three months ended June 30, 2022 and 2021 (in thousands):
| Three Months Ended June 30, | ||||||||||||
| 2022 | 2021 | Change | ||||||||||
| (unaudited) | ||||||||||||
| Operating expenses: | ||||||||||||
| Research and development | $ | 8,363 | $ | 4,327 | $ | 4,036 | ||||||
| General and administrative | 3,852 | 1,447 | 2,405 | |||||||||
| Total operating expenses | 12,215 | 5,774 | 6,441 | |||||||||
| Loss from operations | (12,215 | ) | (5,774 | ) | (6,441 | ) | ||||||
| Other income (expense): | ||||||||||||
| Interest income | 230 | 2 | 228 | |||||||||
| Other expense | (6 | ) | (3 | ) | (3 | ) | ||||||
| Total other income (expense) | 224 | (1 | ) | 225 | ||||||||
| Net loss | $ | (11,991 | ) | $ | (5,775 | ) | $ | (6,216 | ) | |||
Research and Development Expenses
Research and development expenses for the three months ended June 30, 2022 were $8.4 million compared to $4.3 million for the three months ended June 30, 2021. The increase of $4.0 million was primarily due to our ongoing Phase 2b/Phase 3 trial causing increases of $3.3 million in clinical costs, $1.0 million in payroll costs, $0.3 million in stock-based compensation and $0.2 million in other miscellaneous costs, partially offset by lower contract manufacturing costs of $0.6 million and preclinical costs of $0.2 million.
| 21 |
General and Administrative Expenses
General and administrative expenses for the three months ended June 30, 2022 were $3.9 million compared to $1.4 million for the three months ended June 30, 2021. The increase of $2.4 million was primarily due to becoming a public company and hiring additional employees causing increases of $0.9 million in professional services related to other consulting expenses, corporate legal fees, audit and accounting services and $0.7 million in insurance expenses, in addition to $0.2 million in payroll costs and stock-based compensation of $0.6 million.
Total Other Income (Expense)
Other income for the three months ended June 30, 2022 was $0.2 million compared to other expense of $1,000 for the three months ended June 30, 2021. The change of $0.2 million was due to interest earned on our cash and cash equivalents and short-term investments for the three months ended June 30, 2022.
Comparison of the Six Months Ended June 30, 2022 and 2021 (Unaudited)
The following table summarizes our results of operations for the six months ended June 30, 2022 and 2021 (in thousands):
| Six Months Ended June 30, | ||||||||||||
| 2022 | 2021 | Change | ||||||||||