What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-11-12 compared with 2024-08-01 · 184 added, 125 removed, 273 unchanged (53% of the section changed)

10 unchanged sentences

BridgeBio Pharma, Inc.

(“we” or the “Company”) is a commercial-stage biopharmaceutical company founded to discover, create, test and deliver transformative medicines to treat patients who suffer from genetic diseases.

(“we”, the “Company”, or “BridgeBio”) is a new type of biopharmaceutical company founded to discover, create, test and deliver transformative medicines to treat patients who suffer from genetic diseases.

BridgeBio’s pipeline of development programs ranges from early science to advanced clinical trials.

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Since inception, BridgeBio has created 18 Investigational New Drug applications, or INDs, and had two products approved by the U.S.

Food and Drug Administration.

We worked across over 20 disease states at various stages of development.

Food and Drug Administration (“FDA”).

We have worked across over 20 disease states at various stages of development.

Several of our programs target indications that we believe present the potential for our product candidates, if approved, to target portions of market opportunities of at least $1.0 billion in annual sales.

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We have incurred significant operating losses since our inception.

For the six months ended June 30, 2024 and 2023, we incurred net losses of $111.7 million and $303.4 million, respectively.

For the nine months ended September 30, 2024 and 2023, we incurred net losses of $276.0 million and $482.9 million, respectively.

We continue to evaluate our research and development pipelines and restructure our business to streamline costs and expenses.

We also continue to explore business opportunities to partner, divest or delay certain research and development programs to drive operational changes in our business processes, efficiencies and cost savings to advance our corporate strategy and development programs.

We expect that these initiatives, including restructuring will reduce our operating expenses.

As of November 12, 2024, the issuance date of the condensed consolidated financial statements for the nine months ended September 30, 2024, we concluded that there is substantial doubt about our ability to continue as a going concern for a period of one year from the date that these condensed consolidated financial statements are issued due to our history of recurring losses from operations incurred since inception and our expectation of continuing operating losses for the foreseeable future.

The accompanying condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

Accordingly, the condensed consolidated financial statements have been prepared on a basis that assumes we will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

We are entitled to receive a $500.0 million milestone payment under our Funding Agreement (described in Note 10 of our condensed consolidated financial statements) upon obtaining the FDA approval of acoramidis.

We plan to alleviate substantial doubt by obtaining the $500.0 million milestone payment under our Funding Agreement together with product revenues from the commercial sale of acoramidis, if approved.

Although we anticipate receiving FDA approval for acoramidis in late November 2024, we cannot guarantee that we will receive such approval or the resulting milestone payment on a timely basis, or at all, or that we will generate the expected product revenues from the sale of acoramidis, and we may need to raise additional capital to fund our operations.

There can be no assurance that any additional financing will be available to us.

Failure to obtain FDA approval for acoramidis will result in our inability to receive the $500.0 million milestone payment pursuant to the Funding Agreement, which may significantly harm our business, prospects, financial condition and results of operations.

Furthermore, there can be no assurance that in the event we require additional financing, such financing will be available.

Our ability to generate product revenue sufficient to achieve profitability will depend heavily on the successful development and eventual commercialization of our product candidates at our wholly-owned subsidiaries and controlled entities.

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In addition, we have very limited experience with commercialization, and we may not be able to generate significant revenues from product sales, if any, even if any of our product candidates are approved for commercial sale.

Further, we may not realize the anticipated efficiencies and

other benefits of our past and any future restructuring initiatives.

Additionally, failure to secure FDA approval for acoramidis will result in our inability to receive a $500.0 million milestone payment pursuant to the Funding Agreement, which would significantly harm our business, prospects, financial condition and results of operations.

In June 2024, BridgeBio Europe B.V.

(“BridgeBio B.V.”) entered into a commercial supply agreement with Bayer (“Bayer Supply Agreement”) with an initial 30-month term ending in December 2026, for which BridgeBio B.V.

will manufacture and supply to Bayer the commercial product ordered by Bayer solely for the use in the commercialization in the Licensed Territory under the Bayer Agreement.

Under the Bayer Supply Agreement, Bayer shall pay to BridgeBio B.V.

a commercial product per unit price equal to the applicable fully burdened manufacturing cost per unit of product, which shall include the cost of the API used to manufacture the product and the packaging price.

As of June 30, 2024 there have been no commercial product supply sales to Bayer.

Further, we may not realize the anticipated efficiencies and other benefits of our past and any future restructuring initiatives.

Failure to generate sufficient cash flows from operations, raise additional capital or reduce certain discretionary spending may have a material adverse effect on our ability to achieve our intended business objectives.

Since inception through August 16, 2024, Portal Therapeutics, Inc.

and Sub21, Inc.

were our majority-owned consolidated subsidiaries.

On August 16, 2024, we contributed all of our equity ownership in these entities to GondolaBio, LLC and as a result, Portal Therapeutics, Inc.

and Sub21, Inc.

were deconsolidated in conjunction with the GondolaBio transaction below.

GondolaBio was formed on June 5, 2024 and the Company was the sole member.

On August 16, 2024, based on the recommendation of a special committee of independent and disinterested directors of BridgeBio, we entered into a transaction agreement (the “Transaction Agreement”) providing for the formation and funding by certain third party investors of GondolaBio, LLC, a Delaware limited liability company (“GondolaBio”), a legal joint venture entity for the purpose of researching, developing, manufacturing and commercializing pharmaceutical products, including certain assets contributed to GondolaBio by BridgeBio.

The investors providing financing to GondolaBio consist of an investor syndicate, including Viking Global Investors LP, Patient Square Capital, Sequoia Capital, Frazier Life Sciences, Cormorant Asset Management, Aisling Capital and an entity owned by Neil Kumar, the Company’s Chief Executive Officer.

The investors have committed $300.0 million of tranched financing to GondolaBio, of which $60.0 million had been contributed as of September 30, 2024.

We contributed certain assets and our equity in Portal Therapeutics, Inc.

and Sub21, Inc.

to GondolaBio.

Upon completion of the initial contributions, the Company’s equity ownership in GondolaBio was 45.5%, which had a fair value of $50.0 million, and will be subject to reduction as additional tranches of capital contributions are funded.

On August 16, 2024, in conjunction with the Transaction Agreement, GondolaBio’s limited liability company agreement was amended and restated to reflect a change in its governance structure and composition of the board of managers, which was determined to be a VIE reconsideration event.

Based on the VIE reconsideration assessment, GondolaBio was deemed a VIE.

As a result of the change in governance structure and composition of the board of managers, we are no longer the primary beneficiary, as we no longer have the power over key decisions that significantly impact GondolaBio’s economic performance.

Accordingly, we deconsolidated GondolaBio, inclusive of Portal Therapeutics, Inc.

and Sub21, Inc., on August 16, 2024.

On August 16, 2024, we recognized an approximate $52.0 million net gain from deconsolidation of subsidiaries which is presented on the condensed consolidated statements of operations for the nine months ended September 30, 2024.

Upon the deconsolidation of GondolaBio, we accounted for our investment in GondolaBio, for which we had significant influence through our ownership interest, using the equity method of accounting as of August 16, 2024.

GondolaBio was also deemed a related party.

For the period August 16, 2024 through September 30, 2024, we recognized a net loss from equity method investment of $1.4 million.

As of September 30, 2024, the aggregate carrying amount of our equity method investment in GondolaBio is $48.6 million and is presented as part of “Investment in nonconsolidated entities” on our condensed consolidated balance sheets.

On April 30, 2024, TheRas, Inc., doing business as BridgeBio Oncology Therapeutics (BBOT), a majority-owned subsidiary of the Company, completed a $200.0 million private equity financing with external investors to accelerate the development of its oncology portfolio.

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Based on the VIE reconsideration assessment, BBOT was deemed a VIE.

As a result of the change in the governance structure and composition of the board of directors, BridgeBio is no longer the primary beneficiary of BBOT, as it no longer has the power over key decisions that significantly impact BBOT’s economic performance.

Accordingly, BridgeBio deconsolidated BBOT on April 30, 2024.

During the three months ended June 30, 2024, we recognized a $126.3 million net gain from deconsolidation of a subsidiary which is presented on the condensed consolidated statements of operations for the three and six months ended June 30, 2024.

As a result of the change in the governance structure and composition of the board of directors, we are no longer the primary beneficiary of BBOT, as we no longer have the power over key decisions that significantly impact BBOT’s economic performance.

Accordingly, we deconsolidated BBOT on April 30, 2024.

On April 30, 2024, we recognized a $126.3 million net gain from deconsolidation of subsidiaries which is presented on the condensed consolidated statements of operations for the nine months ended September 30, 2024.

Upon the deconsolidation of BBOT, BridgeBio accounted for its retained investments in BBOT, for which it has significant influence through its ownership interest, using the equity method of accounting.

BBOT was also deemed a related party.

For the period May 1, 2024 through June 30, 2024, we recognized a net loss from equity method investment of $7.9 million.

As of June 30, 2024, the aggregate carrying amount of our equity method investment in BBOT is $117.0 million and is presented as “Investment in nonconsolidated entity” on our condensed consolidated balance sheets.

On March 1, 2024, certain subsidiaries of the Company, including Eidos Therapeutics, Inc., BridgeBio International GmbH and BridgeBio Europe B.V.

For the period May 1, 2024 through September 30, 2024, we recognized a net loss from equity method investment of $13.1 million.

As of September 30, 2024, the aggregate carrying amount of our equity method investment in BBOT is $111.8 million and is presented as part of “Investment in nonconsolidated entities” on our condensed consolidated balance sheets.

On March 1, 2024, certain subsidiaries of BridgeBio, including Eidos Therapeutics, Inc., BridgeBio International GmbH and BridgeBio Europe B.V.

(collectively “the Seller Parties”), entered into an exclusive license agreement (the “Bayer Agreement”) with Bayer Consumer Care AG, a wholly-owned subsidiary of Bayer AG (“Bayer”), to develop and commercialize acoramidis as a treatment for transthyretin amyloidosis in the European Union and all member states of the European Patent Organization (the “Licensed Territory”).

Under the terms of the Bayer Agreement, the Seller Parties granted Bayer an exclusive license, effective upon the date that certain antitrust clearances have been obtained, to certain of the Seller Parties’ intellectual property rights to develop, manufacture and commercialize acoramidis (previously known as AG10) in the Licensed Territory.

In consideration for the license grant, the Seller Parties are entitled to receive an upfront payment of $135.0 million and will be eligible to receive up to $175.0 million in regulatory and sales milestone payments through 2026, and additional payments up to $450.0 million subject to the achievement of certain sales milestones.

In consideration for the license grant, the Seller Parties are entitled to receive an upfront payment of $135.0 million and will be eligible to receive up to $175.0 million in regulatory and sales milestone payments through 2026 (of which $75.0 million is for a regulatory milestone dependent upon EU Commission Regulatory approval of acoramidis on or before December 31, 2025), and additional payments up to $450.0 million subject to the achievement of certain sales milestones.

In addition, the Seller Parties are entitled to receive royalties according to a tiered structure starting in the low-thirties percent on net sales by Bayer of acoramidis in the Licensed Territory, subject to reduction under certain circumstances as provided in the Bayer Agreement.

In June 2024, BridgeBio Europe B.V.

(“BridgeBio B.V.”) entered into a commercial supply agreement with Bayer (“Bayer Supply Agreement”) with an initial 30-month term ending in December 2026, for which BridgeBio B.V.

will manufacture and supply to Bayer the commercial product ordered by Bayer solely for the use in the commercialization in the Licensed Territory under the Bayer Agreement.

Under the Bayer Supply Agreement, Bayer shall pay to BridgeBio B.V.

As of September 30, 2024, there have been no commercial product supply sales to Bayer.

On February 7, 2024, our subsidiary, QED, and Kyowa Kirin Co., Ltd (“Kyowa Kirin” or “KKC”) entered into a partnership wherein QED granted Kyowa Kirin an exclusive license to develop, manufacture, and commercialize infigratinib for achondroplasia, hypochondroplasia, and other skeletal dysplasias in Japan in accordance with the terms therein (“KKC Agreement”).

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In return, we granted the Purchasers the right to receive payments (the “Royalty Interest Payments”) equal to 5% of the global net sales of acoramidis (“Net Sales”), which under certain conditions may adjust to a maximum rate of 10% in 2027.

Each Royalty Interest Payment will become

payable to the Purchasers on a quarterly basis after the Funding Date.

Each Royalty Interest Payment will become payable to the Purchasers on a quarterly basis after the Funding Date.

In addition, the Seller Parties granted the collateral agent, for the benefit of the Purchasers, a security interest in specific assets related to acoramidis.

The Funding Agreement will terminate upon customary events, and also in the event the Funding Date does not occur on or prior to May 15, 2025 (in which case either party may terminate the Funding Agreement at no charge and without premium or penalty).

As of June 30, 2024, the Company has not received proceeds under the Funding Agreement.

The Funding Agreement will terminate upon customary events, and also in the event the Funding Date does not occur on or prior to May 15, 2025 (in which case either party may

terminate the Funding Agreement at no charge and without premium or penalty).

As of September 30, 2024, the Company has not received proceeds under the Funding Agreement.

Refer to “Liquidity and Capital Resources” section for additional details regarding this agreement.

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The restructuring initiative included, among other components, consolidation and rationalization of our facilities, reprioritization of development programs and the reduction in our workforce.

In March 2024, upon entering into the Bayer Agreement and termination of the Navire-BMS License Agreement (refer to Note 11 for details regarding these transactions), we have committed to additional restructuring plans to reprioritize and advance our corporate strategy and development programs.

Upon entering into the Bayer Agreement and termination of the Navire-BMS License Agreement in March 2024 (refer to Note 11 for details regarding these transactions) and our announced decision to cease pursuing development of BBP-631, the Company’s investigational adeno-associated virus 5 gene therapy, for congenital adrenal hyperplasia (“CAH”) in September 2024, we have committed to additional restructuring plans to reprioritize and advance our corporate strategy and development programs.

We estimate that we will incur a remaining $6.0 million to $8.0 million in restructuring charges, consisting primarily of winding down costs, exit and other related costs, and severance and employee-related costs.

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We may also incur additional costs that are not currently foreseeable as we continue to evaluate our restructuring alternatives to drive operational changes in business processes, efficiencies and cost savings.

During the six months ended June 30, 2024 and 2023, our restructuring, impairment and related charges amounted to $6.3 million and $6.9 million, respectively, which consisted primarily of winding down costs, exit and other related costs, impairments and write-offs of long-lived assets, and severance and employee-related costs.

During the nine months ended September 30, 2024 and 2023, our restructuring, impairment and related charges amounted to $10.9 million and $7.2 million, respectively, which consisted primarily of winding down costs, exit and other related costs, impairments and write-offs of long-lived assets, and severance and employee-related costs.

Results of Operations

The following table summarizes the results of our operations for the periods indicated:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

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Interest expense

Gain on deconsolidation of a subsidiary

Gain on deconsolidation of subsidiaries

Loss on extinguishment of debt

Net loss from equity method investment

Net loss from equity method investments

Other income (expense), net

2 unchanged sentences

Net loss attributable to common stockholders of BridgeBio

June 30, 2024

September 30, 2024

December 31, 2023

(in thousands)

Cash, cash equivalents and marketable securities

Cash and cash equivalents

Restricted cash

Investments in equity securities

Cash, Cash Equivalents, Marketable Securities, Restricted Cash and Investments in Equity Securities

As of June 30, 2024, we had cash, cash equivalents and marketable securities of $447.8 million and restricted cash of $139.4 million, compared to cash, cash equivalents and marketable securities of $375.9 million, restricted cash of $16.7 million and investments in equity securities of $58.9 million as of December 31, 2023.

Cash, Cash Equivalents, Restricted Cash and Investments in Equity Securities

As of September 30, 2024, we had cash and cash equivalents of $266.3 million and restricted cash of $139.4 million, compared to cash and cash equivalents of $375.9 million, restricted cash of $16.7 million and investments in equity securities of $58.9 million as of December 31, 2023.

Under the terms of the Amended Financing Agreement, the Company is required to deposit 75% of proceeds, net of certain permitted costs, received from certain asset sale transactions into an escrow account to be controlled by the Administrative Agent.

During the three months ended June 30, 2024, we received $235.0 million in aggregate from Bayer and Kyowa Kirin, and deposited net proceeds of $159.3 million into the escrow accounts, which was classified as “restricted cash” on the condensed consolidated balance sheet as of June 30, 2024.

During the three months ended June 30, 2024, we received $235.0 million in aggregate from Bayer and Kyowa Kirin, and deposited net proceeds of $159.3 million into the escrow accounts, which was classified as “Restricted cash” on the condensed consolidated balance sheet.

Furthermore, under the terms of Amended Financing Agreement, between June 20, 2024 and through the earlier of the FDA approval date and November 30, 2024, the Company is able to request a release of funds in an aggregate amount not to exceed 50% of the original net cash proceeds received from asset sale transactions.

As of June 30, 2024, $20.0 million was released from the escrow accounts and classified as cash on the condensed consolidated balance sheet, with a remaining balance of $139.3 million in the escrow accounts classified as restricted cash.

As of September 30, 2024, $20.0 million was released from the escrow accounts and classified as cash on the condensed consolidated balance sheet, with a remaining balance of $139.3 million in the escrow accounts classified as restricted cash.

Refer to Note 9 and Note 11 for further details regarding the Amended Financing Agreement, the Bayer Agreement and KKC Agreement.

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The following table summarizes our revenue for the following periods:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

Revenue for the three months ended June 30, 2024 consists mainly of the recognition of services revenue under the Bayer Agreement and the KKC Agreement.

Revenue for the three months ended June 30, 2023 was primarily related to the recognition of services revenue under the Navire-BMS License Agreement.

Revenue for the six months ended June 30, 2024 consists mainly of $202.9 million from the recognition of the upfront license fee and services revenue under the Bayer Agreement and the KKC Agreement.

Revenue for the three months ended September 30, 2024 consists mainly of the recognition of services revenue under the Bayer Agreement and the KKC Agreement.

Revenue for the three months ended September 30, 2023 was primarily related to the recognition of license revenue for the shipment of clinical supplies to our partners pursuant to our executed supply agreements and services revenue under the Navire-BMS License Agreement.

Revenue for the nine months ended September 30, 2024 consists mainly of $205.3 million from the recognition of the upfront license fee and services revenue under the Bayer Agreement and the KKC Agreement.

An additional $9.9 million of revenue was attributable to the remaining services revenue in connection with the Navire-BMS License Agreement as a result of the termination of the agreement.

Revenue for the six months ended June 30, 2023 was primarily related to the recognition of services revenue under the Navire-BMS License Agreement.

Revenue for the nine months ended September 30, 2023 was primarily related to the recognition of license revenue for the shipment of clinical supplies to our partners pursuant to our executed supply agreements and services revenue under the Navire-BMS License Agreement.

The level of revenue, including license and service revenue, that we recognize depends in part upon the estimated recognition period of the upfront payments allocated to continuing performance obligations, the achievement of milestones and other contingent events, the level of effort incurred for research and development contracted services, and the impact of entering into new licensing and collaboration agreements, if any.

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The following table summarizes our research and development expenses for the following periods:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

Research and development

Research and development expenses increased by $7.2 million for the three months ended June 30, 2024, compared to the same period in 2023.

This change was primarily due to an increase in personnel costs of $11.9 million and external costs of $2.4 million to support the advancement of research and development for our key programs, an increase in licensing fees of $1.3 million, which was offset by a decrease in stock-based compensation of $8.3 million.

Research and development expenses increased by $55.3 million for the six months ended June 30, 2024, compared to the same period in 2023.

This change was primarily due to an increase in personnel costs of $28.4 million and external costs of $24.1 million to support the advancement of research and development for our key programs, an increase in licensing fees of $10.1 million, which was offset by a decrease in stock-based compensation of $7.3 million.

Research and development costs consist primarily of external costs, such as fees paid to consultants, contractors, contract manufacturing organizations (“CMOs”), and contract research organizations, or CROs, purchase of active pharmaceutical ingredients, or APIs, in connection with our preclinical, contract manufacturing and clinical development activities and are tracked on a program-by-program basis.

Research and development expenses increased by $4.7 million for the three months ended September 30, 2024, compared to the same period in 2023.

This change was primarily due to a decrease in licensing fees of $10.1 million, a decrease in stock-based compensation of $2.0 million and a decrease in external costs of $1.4 million, mainly due to the deconsolidation of affiliates, which was partially offset by an increase in personnel costs of $8.7 million.

Research and development expenses increased by $50.6 million for the nine months ended September 30, 2024, compared to the same period in 2023.

This change was primarily due to an increase in personnel costs of $37.1 million and external costs of $22.7 million to support the advancement of research and development for our key programs, which was partially offset by a decrease in stock-based compensation of $9.3 million.

internal costs, such as personnel and facility costs, and are tracked on a program-by-program basis.

License fees and other costs incurred after a product candidate has been designated and that are directly related to the product candidate are included in the specific program expense.

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The following table summarizes our research and development expenses by program incurred for the following periods:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

ATTR Amyloidosis - TTR stabilizer (acoramidis)

Achondroplasia - low-dose FGFRi (infigratinib)

LGMD2I/R9 - Glycosylation substrate (BBP-418)

ADH1 - CaSR antagonist (encaleret)

Acoramidis for ATTR-CM

BBP-418 (ribitol) for LGMD2I/R9

Encaleret for ADH1

Other development programs

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The following table summarizes our selling, general and administrative expenses for the following periods:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

Selling, general and administrative

Selling, general and administrative expenses increased by $23.4 million for the three months ended June 30, 2024, compared to the same period in 2023, mainly due to an increase in external costs of $10.9 million and personnel related expense of $10.0 million to support commercialization readiness efforts, and an increase in stock-based compensation expense of $2.5 million.

Selling, general and administrative expenses increased by $58.1 million for the six months ended June 30, 2024, compared to the same period in 2023, mainly due to an increase in external costs of $19.5 million and personnel related expense of $17.7 million to support commercialization readiness efforts, nonrecurring deal-related expenses of $14.0 million, and an increase in stock-based compensation expense of $6.9 million.

Selling, general and administrative expenses increased by $33.0 million for the three months ended September 30, 2024, compared to the same period in 2023, mainly due to an increase in personnel related expense of $16.4 million and external costs of $14.7 million, to support our commercialization readiness efforts, which included costs incurred for marketing, advertising and buildup of salesforce, and an increase in stock-based compensation expense of $1.9 million.

Selling, general and administrative expenses increased by $91.1 million for the nine months ended September 30, 2024, compared to the same period in 2023, mainly due to an increase in personnel related expense of $34.1 million and external costs of $31.7 million to support our commercialization readiness efforts, which included costs incurred for marketing, advertising and buildup of salesforce, nonrecurring deal-related expenses of $16.5 million, and an increase in stock-based compensation expense of $8.8 million.

Restructuring, Impairment and Related Charges

The following table summarizes our restructuring, impairment and related charges during the periods indicated:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

2 unchanged sentences

The restructuring initiative included, among other components, consolidation and rationalization of our facilities, reprioritization of development programs and the reduction in our workforce.

Upon entering into the Bayer Agreement and termination of the Navire-BMS License Agreement in March 2024 (refer to Note 11 for details regarding these transactions) and our announced decision to cease pursuing development of BBP-631 for CAH in September 2024, we have committed to additional restructuring plans to reprioritize and advance our corporate strategy and development programs.

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The following table summarizes our interest income during the periods indicated:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

1 unchanged sentence

Interest income consists of interest income earned on our cash equivalents and marketable securities.

The amount of interest income during the three and six months ended June 30, 2024 as compared to the same period in 2023 was generally consistent.

The amount of interest income during the three and nine months ended September 30, 2024 as compared to the same period in 2023 was generally consistent.

Generally, increases and decreases in interest income are attributable to changes in the interest-bearing average balances of our cash equivalents and marketable securities and fluctuations in interest rates.

1 unchanged sentence

The following table summarizes our interest expense during the periods indicated:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

3 unchanged sentences

As a result of the variable interest rates under our Amended Financing Agreement we expect our interest expense will continue to fluctuate in the future.

Gain on Deconsolidation of a Subsidiary

The following table summarizes our gain on deconsolidation of a subsidiary during the periods indicated:

Three Months Ended June 30,

Six Months Ended June 30,

Gain on deconsolidation of a subsidiary

On April 30, 2024, BBOT, a majority-owned subsidiary of the Company, completed a $200.0 million private equity financing with external investors.

As a result of the private equity financing transaction, BridgeBio deconsolidated BBOT on April 30, 2024 and recognized a net gain from deconsolidation of $126.3 million for the three and six months ended June 30, 2024.

Gain on Deconsolidation of Subsidiaries

The following table summarizes our gain on deconsolidation of subsidiaries during the periods indicated:

Three Months Ended September 30,

Nine Months Ended September 30,

Gain on deconsolidation of subsidiaries

On August 16, 2024, we entered into the Transaction Agreement providing for the formation and funding by certain third party investors of GondolaBio.

Under the Transaction Agreement, the investors contributed $60.0 million and we contributed certain assets and our equity in Portal Therapeutics, Inc.

and Sub 21, Inc.

to GondolaBio.

As a result of the private equity financing transaction and contribution, we deconsolidated GondolaBio, inclusive of Portal Therapeutics, Inc.

and Sub21, Inc., on August 16, 2024 and

recognized a net gain from deconsolidation of approximately $52.0 million during the three and nine months ended September 30, 2024.

Refer to Note 6 for further details regarding the GondolaBio private equity financing transaction.

On April 30, 2024, BBOT, a majority-owned subsidiary of BridgeBio, completed a $200.0 million private equity financing with external investors.

As a result of the private equity financing transaction, BridgeBio deconsolidated BBOT on April 30, 2024 and recognized a net gain from deconsolidation of $126.3 million during the nine months ended September 30, 2024.

Refer to Note 6 for further details regarding the BBOT private equity financing transaction.

1 unchanged sentence

The following table summarizes our loss on extinguishment of debt during the periods indicated:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

2 unchanged sentences

Refer to Note 9 to our condensed consolidated financial statements.

Net Loss from Equity Method Investment

The following table summarizes our share in net loss of equity method investment during the periods indicated:

Three Months Ended June 30,

Six Months Ended June 30,

Net loss from equity method investment

Upon the deconsolidation of BBOT, BridgeBio accounted for its retained investment in BBOT using the equity method of accounting.

For the period May 1, 2024 through June 30, 2024, we recorded a net loss from equity method investment of $7.9 million.

Net Loss from Equity Method Investments

The following table summarizes our share in net loss of equity method investments during the periods indicated:

Three Months Ended September 30,

Nine Months Ended September 30,

Net loss from equity method investments

Upon the deconsolidation of GondolaBio on August 16, 2024 and BBOT on April 30, 2024, we accounted for our investments in GondolaBio and BBOT using the equity method of accounting.

For the three months ended September 30, 2024 we recorded net losses from equity method investments in GondolaBio and BBOT of $1.4 million and $5.2 million, respectively.

For the nine months ended September 30, 2024 we recorded net losses from equity method investments in GondolaBio and BBOT of $1.4 million and $13.1 million, respectively.

Other Income (Expense), Net

The following table summarizes our other income (expense), net during the periods indicated:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

Other income (expense), net

Other income (expense), net for the three months ended June 30, 2024 consists mainly of a $1.1 million disposition fee incurred under the Amended Financing Agreement in relation to the BBOT private equity financing transaction, partially offset by $0.8 million in other income recognized under the Transition Service Agreement with BBOT.

Other income (expense), net for the three months ended June 30, 2023 consists mainly of the net realized and unrealized gains from changes in fair value of our equity security investments of $1.4 million.

Other income (expense), net for the six months ended June 30, 2024 consists mainly of the net realized gain of $8.1 million from our investments in equity securities.

Other income (expense), net for the six months ended June 30, 2023 consists mainly of the net realized and unrealized gains from changes in fair value of our investments in equity securities of $2.4 million, partially offset by a $1.2 million loss from the deconsolidation of PellePharm.

Other income (expense), net for the three months ended September 30, 2024 consists mainly of $1.2 million of other income recognized under the Transition Service Agreements with GondolaBio and BBOT.

Other income (expense), net for the three months ended September 30, 2023 consists mainly of the net realized and unrealized losses from changes in fair value of our equity security investments of $5.4 million.

Other income (expense), net for the nine months ended September 30, 2024 consists mainly of the net realized gain of $8.1 million from our investments in equity securities, and $2.0 million of other income recognized under the Transition Service Agreements with GondolaBio and BBOT.

Other income (expense), net for the nine months ended September 30, 2023 consists mainly of the net realized and unrealized losses from changes in fair value of our investments in equity securities of $3.0 million and a $1.2 million loss from the deconsolidation of PellePharm.

Net Loss Attributable to Redeemable Convertible Noncontrolling Interests and Noncontrolling Interests

The following table summarizes our net loss attributable to redeemable convertible noncontrolling interests and noncontrolling interests during the periods indicated:

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended September 30,

Nine Months Ended September 30,

(in thousands)

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We have historically financed our operations primarily through the sale of our equity securities, issuance of convertible notes, debt borrowings, and revenue from certain licensing and collaboration agreements and sales of certain assets.

As of June 30, 2024, we had cash, cash equivalents and marketable securities of $447.8 million and restricted cash of $139.4 million, including funds held by our wholly-owned subsidiaries and controlled entities, which are available only for specific entity usage.

As of June 30, 2024, our outstanding debt was $1.7 billion, net of debt discounts and issuance costs and accretion.

As of September 30, 2024, we had cash and cash equivalents of $266.3 million and restricted cash of $139.4 million, including funds held by our wholly-owned subsidiaries and controlled entities, which are available only for specific entity usage.

As of September 30, 2024, our outstanding debt was $1.7 billion, net of debt discounts and issuance costs and accretion.

Since inception, we have incurred significant operating losses.

For the six months ended June 30, 2024, we incurred net losses of $111.7 million.

We had an accumulated deficit as of June 30, 2024 of $2.7 billion.

For the nine months ended September 30, 2024 and 2023, we incurred net losses of $276.0 million and $482.9 million, respectively and used cash in operations of $325.4 million and $402.9 million, respectively.

While we have undertaken activities in preparation for commercial launch readiness for our late-stage programs and a restructuring initiative to drive operational change in business processes, efficiencies and cost savings, we expect to continue to incur significant operating and net losses over the next several years as we continue to fund our drug development and discovery efforts.

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Our current business plan is also subject to significant uncertainties and risks as a result of, among other factors, our ability to generate product sales sufficient to achieve profitability, which will depend heavily on the successful development and eventual commercialization of product candidates at our consolidated entities as well as our ability to partner in the development of certain clinical programs, as well as the levels of our operating expenses.

Our short-term and long-term liquidity requirements include contractual payments related to our 2029 Notes, 2027 Notes and term loan (refer to Note 9 to our condensed consolidated financial statements), obligations under our real estate leases (refer to Note 13 to our condensed consolidated financial statements), accounts payable, accrued liabilities and the remaining liabilities under our restructuring initiative (refer to Note 16 to our condensed consolidated financial statements).

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We also enter into agreements in the normal course of business with CROs and other vendors for clinical trials and with vendors for preclinical studies and other services and products for operating purposes, which are generally cancelable upon written notice with potential termination charges.

We expect our cash and cash equivalents, marketable securities and restricted cash will fund our operations for at least the next 12 months from the date of filing of this Quarterly Report on Form 10-Q based on current operating plans and financial forecasts.

If our current operating plans or financial forecasts change, including as a result of general market and economic conditions, inflationary pressures, supply chain issues on our research and development activities, we may require additional funding sooner in the form of public or private equity offerings, debt financings or additional collaborations and licensing arrangements.

However, future financing may not be available in amounts or on terms acceptable to us, if at all.

We continue to evaluate our research and development pipelines and restructure our business to streamline costs and expenses.

We expect that these initiatives, including restructuring, will reduce our operating expenses.

There can be no assurance that any additional financing will be available to us.

Furthermore, there can be no assurance that in the event we require additional financing, such financing will be available.

In addition, we are closely monitoring macroeconomic events, including inflationary pressures and supply chain issues, which may negatively impact our financial and operating results.

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achievement of certain sales milestones.

In consideration for the license grant, the Seller Parties are entitled to receive an upfront payment of $135.0 million and will be eligible to receive up to $175.0 million in regulatory and sales milestone payments through 2026 (of which $75.0 million is for a regulatory milestone dependent upon EU Commission Regulatory approval of acoramidis on or before December 31, 2025), and additional payments up to $450.0 million subject to the achievement of certain sales milestones.

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The Bayer and KKC agreements meet the requirements of asset sale transactions under the terms of the Amended Financing Agreement.

During the three months ended June 30, 2024, we received $235.0 million in aggregate from Bayer and KKC, and deposited net proceeds of $159.3 million into the escrow accounts, which was classified as “restricted cash” on the condensed consolidated balance sheet as of June 30, 2024.

During the three months ended June 30, 2024, we received $235.0 million in aggregate from Bayer and KKC, and deposited net proceeds of $159.3 million into the escrow accounts, which was classified as “Restricted cash” on the condensed consolidated balance sheet.

Refer to the “Term Loan, net” section below for details regarding the escrow accounts deposits required for asset sales transactions under the Amended Financing Agreement.

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The Company paid the Underwriters a commission of 3.6% of the aggregate gross proceeds received from all sales of the common stock under the Follow-on Agreement.

In March 2024, 9,913,793 shares (including the 1,293,103 shares issued upon exercise of the 2024 Underwriters’ option to purchase additional shares) were issued under the 2024 Follow-on Agreement, for net proceeds of $276.6 million, after deducting underwriting fees and commissions of $10.3 million and deferred offering costs of $0.6 million.

proceeds of $276.6 million, after deducting underwriting fees and commissions of $10.3 million and deferred offering costs of $0.6 million.

In May 2023, we filed a shelf registration statement on Form S-3ASR, or the 2023 Shelf, with the SEC in relation to the registration of common stock, preferred stock, debt securities, warrants and units or any combination thereof.

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We will pay the ATM Sales Agents a commission of up to 3.0% of the aggregate gross proceeds received from all sales of the common stock under the 2023 ATM Agreement.

During the three and six months ended June 30, 2024, 1,061,991 shares were issued under the ATM Agreement, for net proceeds of $38.1 million, after deducting sales agent fees and commissions of $0.6 million.

As of June 30, 2024, we are still eligible to sell up to $345.3 million of our common stock pursuant to the ATM Agreement under the 2023 Shelf.

As of June 30, 2024, we have borrowings under the 2029 Notes, the 2027 Notes and the Term Loan under the Amended Financing Agreement, which are discussed below.

During the three and nine months ended September 30, 2024, 1,061,991 shares were issued under the ATM Agreement, for net proceeds of $38.1 million, after deducting sales agent fees and commissions of $0.6 million.

As of September 30, 2024, we are still eligible to sell up to $345.3 million of our common stock pursuant to the ATM Agreement under the 2023 Shelf.

As of September 30, 2024, we have borrowings under the 2029 Notes, the 2027 Notes and the Term Loan under the Amended Financing Agreement, which are discussed below.

2029 Notes, net

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In certain instances and during certain time periods, prepayments will be subject to customary prepayment fees.

The amount of any prepayment fee may vary, but the maximum amount that may be due with any such prepayment would be an amount equal to 3.00% of the Term Loans being prepaid at such time, plus a customary make whole amount.

The amount of any prepayment fee may vary, but the maximum amount

that may be due with any such prepayment would be an amount equal to 3.00% of the Term Loans being prepaid at such time, plus a customary make whole amount.

We have entered into asset sales transactions that occurred during the three months ended March 31, 2024 for the exclusive license agreements with Bayer Consumer Care AG and Kyowa Kirin Co., Ltd, for which the Company is required to deposit 75% of the proceeds, net of certain permitted costs, upon receipt of the upfront payments from Bayer Consumer Care AG and Kyowa Kirin Co., Ltd, into the escrow accounts.

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was considered an asset sale transaction that was subject to a disposition fee under the Financing Agreement.

Accordingly, we paid a disposition fee of $1.1 million to the Administrative Agent during the three months ended June 30, 2024.

Accordingly, we paid a disposition fee of $1.1 million to the Administrative Agent in May 2024.

Refer to Note 6 for further details regarding the BBOT private equity financing transaction.

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Under the Amended Financing Agreement, between June 20, 2024 and through the earlier of the FDA approval date and November 30, 2024, the Company is able to request a release of funds in an aggregate amount not to exceed 50% of the original net cash proceeds received from asset sale transactions.

As of June 30, 2024, $20.0 million was released from the escrow accounts and classified as cash, with a remaining balance of $139.3 million in the escrow accounts classified as “restricted cash” on the condensed consolidated balance sheet.

As of September 30, 2024, $20.0 million was released from the escrow accounts and classified as cash, with a remaining balance of $139.3 million in the escrow accounts classified as “Restricted cash” on the condensed consolidated balance sheet.

Furthermore, under the Amended Financing Agreement, the minimum qualified cash balance was amended from $70.0 million to $70.0 million plus 40% of any cash released by the Company from the escrow accounts, at all times.

As of June 30, 2024, the minimum unrestricted qualified cash balance was $78.0 million.

As of September 30, 2024, the minimum unrestricted qualified cash balance was $78.0 million.

The following table summarizes our cash flows during the periods indicated:

Six Months Ended June 30,

Nine Months Ended September 30,

(in thousands)

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Net cash provided by financing activities

Net increase (decrease) in cash, cash equivalents and

Net increase in cash, cash equivalents and

restricted cash

Net Cash Flows Used in Operating Activities

Net cash used in operating activities was $144.8 million for the six months ended June 30, 2024, consisting primarily of our net loss of $111.7 million, adjusted for non-cash items totaling $54.4 million, which primarily includes a $126.3 million net gain on the deconsolidation of a subsidiary, $8.1 million net realized gain from investment in equity securities, offset by $38.5 million in stock-based compensation expense, $26.6 million in loss on extinguishment of debt from the repayment of the term loan under the Amended Loan Agreement, net loss from equity method investment of $7.9 million, and $3.7 million in accretion of debt;

Net cash used in operating activities was $325.4 million for the nine months ended September 30, 2024, consisting primarily of our net loss of $276.0 million, adjusted for non-cash items totaling $68.5 million, which primarily includes a $178.3 million net gain on the deconsolidation of subsidiaries, $8.1 million net realized gain from investment in equity securities, offset by $65.7 million in stock-based compensation expense, $26.6 million in loss on extinguishment of debt from the repayment of the term loan under the Amended Loan Agreement, net loss from equity method investments of $14.5 million, and $5.4 million in accretion of debt;

and $19.1 million in net cash inflow related to changes in operating assets and liabilities.

The $21.3 million net cash inflow related to changes in operating assets and liabilities was attributed mainly to an increase in deferred revenue of $22.2 million primarily related to the Bayer Agreement and KKC Agreement, an increase of $8.9 million in accounts payable, and an increase of $7.1 million in accrued research and development liabilities, partially offset by a decrease of $8.4 million in accrued compensation and benefits and a decrease in prepaid expenses and other current assets of $6.5 million, which are primarily due to timing of payments.

Net cash used in operating activities was $257.7 million for the six months ended June 30, 2023, consisting primarily of our net loss of $303.4 million, adjusted for non-cash items totaling $64.0 million, which primarily includes $49.1 million in stock-based compensation expense, $6.7 million in accrued payment-in-kind interest, and $4.6 million in accretion of debt, as well as $18.2 million net cash outflow related to changes in operating assets and liabilities.

The $18.2 million net cash outflow related to changes in operating assets and liabilities was attributed mainly to a decrease of $11.3 million in accrued research and development liabilities and a decrease of $11.1 million in accrued compensation and benefits mainly due to timing of payments, a decrease of $4.1 million in accounts payable due to timing of payments, partially offset by a decrease of $8.5 million from licensing and collaboration agreements receivables primarily due to collections.

The $19.1 million net cash inflow related to changes in operating assets and liabilities was attributed mainly to an increase in deferred revenue of $20.6 million primarily related to the Bayer Agreement and KKC Agreement, an increase of $15.5 million in accrued research and development liabilities, and an increase of $5.3 million in accounts payable, partially offset by a decrease in prepaid expenses and other current assets of $17.5 million and a decrease of $5.6 million in accrued compensation and benefits, which are collectively primarily due to timing of payments.

Net cash used in operating activities was $402.9 million for the nine months ended September 30, 2023, consisting primarily of our net loss of $482.9 million;

adjusted for non-cash items totaling $96.9 million, which primarily includes $71.7 million in stock-based compensation expense, $6.7 million in accrued payment-in-kind interest, and $6.7 million in accretion of debt;

and the remaining $16.9 million net cash outflow related to changes in operating assets and liabilities.

The $16.9 million net cash outflow related to changes in operating assets and liabilities was attributed mainly to a decrease of $10.5 million in accrued research and development liabilities, a decrease of $4.2 million in accrued compensation and benefits, and a decrease of $3.4 million in accounts payable, which are collectively due to timing of payments;

a decrease in deferred revenue of $4.5 million due to revenue recognized;

a decrease in operating lease liabilities of $3.7 million;

and partially offset by a decrease of $11.9 million from licensing and collaboration agreements receivables primarily due to collections.

Net Cash Flows Provided by Investing Activities

Net cash provided by investing activities was $25.8 million for the six months ended June 30, 2024, attributable primarily to $63.2 million in proceeds from the sale of equity securities, $55.0 million in proceeds from the maturities of marketable securities, $25.7 million in special cash dividends received from equity securities, partially offset by purchases of marketable securities of $93.8 million and purchases of investments in equity securities of $20.3 million.

Net cash provided by investing activities was $16.4 million for the six months ended June 30, 2023, attributable primarily to $67.1 million in proceeds from the sale of equity securities, $41.6 million in maturities of marketable securities, partially offset by purchases of investment in equity securities of $71.5 million and purchases of marketable securities of $19.8 million.

Net cash provided by investing activities was $64.0 million for the nine months ended September 30, 2024, attributable primarily to $95.0 million in proceeds from the maturities of marketable securities, $63.2 million in proceeds from the sale of equity securities, $25.7 million in special cash dividends received from equity securities, partially offset by purchases of marketable securities of $93.8 million, purchases of investments in equity securities of $20.3 million and $4.8 million in payments made to FMI for intangible assets.

Net cash provided by investing activities was $54.1 million for the nine months ended September 30, 2023, attributable primarily to $82.6 million in maturities of marketable securities and $81.0 million in proceeds from the sale of equity securities, partially offset by purchases of investments in equity securities of $78.3 million and purchases of marketable securities of $29.7 million.

Net Cash Flows Provided by Financing Activities

Net cash provided by financing activities was $273.8 million for the six months ended June 30, 2024, consisting primarily of $450.0 million in proceeds from the term loan under the Financing Agreement, $314.8 million in net proceeds from the issuance of common stock through public offerings, and partially offset by $473.4 million repayment of the term loan under the Amended Loan Agreement, and $16.0 million in issuance costs and discounts associated with the Amended Financing Agreement.

Net cash provided by financing activities was $149.0 million for the six months ended June 30, 2023, consisting primarily of $144.0 million in net proceeds from the issuance of common stock through the Follow-on offering.

Net cash provided by financing activities was $274.5 million for the nine months ended September 30, 2024, consisting primarily of $450.0 million in proceeds from the term loan under the Amended Financing Agreement, and $314.7 million in net proceeds from the issuance of common stock through public offerings, which includes $276.6 million in net proceeds through the 2024 Follow-on offering and $38.1 million in net proceeds through the ATM offering.

These increases were partially offset by the $473.4 million repayment of the term loan under the Amended Loan Agreement, and $16.0 million in issuance costs and discounts associated with the Amended Financing Agreement.

Net cash provided by financing activities was $456.1 million for the nine months ended September 30, 2023, consisting primarily of $450.3 million in net proceeds from the issuance of common stock, which includes $241.3 million in net proceeds from the Private Placement offering, $144.0 million in net proceeds from the 2023 Follow-on offering, and $65.0 million in net proceeds from the ATM offering.

In addition, the increase was also driven by $5.2 million in net proceeds from stock option exercises.

Critical Accounting Policies

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Actual results may differ from these estimates under different assumptions or conditions.

There have been no significant changes in our critical accounting policies and estimates as compared to the critical accounting policies and estimates disclosed in the section titled “Management’s Discussion and Analysis of Financial Condition and Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC, except for certain updates to our accounting policy as discussed in Note 2 in our condensed consolidated financial statements as of and for the six months ended June 30, 2024.

Recent Accounting Pronouncements

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Quantitative and Qualitati ve Disclosures About Market Risk

As of June 30, 2024, we held cash, cash equivalents, marketable securities and restricted cash (current) of $587.2 million.

As of September 30, 2024, we held cash, cash equivalents and restricted cash (current) of $405.7 million.

Our cash equivalents consist of amounts invested in money market funds;

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We do not believe that our cash and cash equivalents have a significant risk of default or illiquidity.

As of June 30, 2024, our 2029 Notes and 2027 Notes had principal balances of $747.5 million and $550.0 million, respectively, which bear fixed interest rates that are not subject to variability as a result of changes in interest rates.

However, as of June 30, 2024, our term loan under the Amended Financing Agreement had a principal balance of $450.0 million, which bears variable interest rates that are subject to variability as a result of changes in interest rates.

The effect of a hypothetical 10% increase in interest rates applicable to the Amended Financing Agreement would increase our interest expense on our term loan by $0.2 million and $0.7 million for the three and six months ended June 30, 2024, respectively.

As of September 30, 2024, our 2029 Notes and 2027 Notes had principal balances of $747.5 million and $550.0 million, respectively, which bear fixed interest rates that are not subject to variability as a result of changes in interest rates.

However, as of September 30, 2024, our term loan under the Amended Financing Agreement had a principal balance of $450.0 million, which bears variable interest rates that are subject to variability as a result of changes in interest rates.

The effect of a hypothetical 10% increase in interest rates applicable to the Amended Financing Agreement would increase our interest expense on our term loan by $0.6 million and $1.3 million for the three and nine months ended September 30, 2024, respectively.

Inflation has decreased during the period covered by this Quarterly Report on Form 10-Q, and is expected to continue to decrease for the near future.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis