What changed in this filing

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Item 1. Financial Statements

2020-11-05 compared with 2020-08-06 · 67 added, 67 removed, 289 unchanged (32% of the section changed)

3 unchanged sentences

(In thousands, except par value data)

September 30,

Current assets:

23 unchanged sentences

56,627 and 45,384 shares issued and outstanding as of

June 30, 2020 and December 31, 2019, respectively

September 30, 2020 and December 31, 2019, respectively

Additional paid-in capital

8 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Operating Expenses:

Research and development (includes related party

amounts of $ 63 and $ 98 for the three months

ended June 30, 2020 and 2019, respectively,

and $ 195 and $ 151 for the six months ended

June 30, 2020 and 2019, respectively)

amounts of nil and $ 133 for the three months

ended September 30, 2020 and 2019, respectively,

and $ 195 and $ 284 for the nine months ended

September 30, 2020 and 2019, respectively)

General and administrative (includes related party

amounts of $ 76 and $ 88 for the three months

ended June 30, 2020 and 2019, respectively,

and $ 187 and $ 175 for the six months ended

June 30, 2020 and 2019, respectively)

amounts of nil and $ 87 for the three months

ended September 30, 2020 and 2019, respectively,

and $ 187 and $ 262 for the nine months ended

September 30, 2020 and 2019, respectively)

Total operating expenses

25 unchanged sentences

and employee stock purchase plan

Other comprehensive income

Balance at June 30, 2020

Other comprehensive loss

Balance at September 30, 2020

Comprehensive

1 unchanged sentence

Income (Loss)

Balance at March 31, 2020

Issuance of common stock, net of offering costs

Balance at June 30, 2020

Share-based compensation expense

Issuance of common stock from exercise of options

and employee stock purchase plan

Other comprehensive loss

Balance at June 30, 2020

Balance at September 30, 2020

See accompanying notes to unaudited condensed financial statements.

11 unchanged sentences

Other comprehensive income

Balance at June 30, 2019

Balance at September 30, 2019

Comprehensive

1 unchanged sentence

Income (Loss)

Balance at March 31, 2019

Issuance of common stock, net of offering costs

Balance at June 30, 2019

Share-based compensation expense

Issuance of common stock from exercise of options

and employee stock purchase plan

Other comprehensive income

Balance at June 30, 2019

Balance at September 30, 2019

See accompanying notes to unaudited condensed financial statements.

2 unchanged sentences

(In thousands)

Six Months Ended

Nine Months Ended

September 30,

Operating Activities

11 unchanged sentences

Investing Activities

Maturities and sales of marketable securities

Purchases of marketable securities

Maturities and sales of marketable securities

Purchases of property and equipment

Net cash provided by investing activities

Net cash used in investing activities

Financing Activities

14 unchanged sentences

We plan to advance our product candidates through a combination of internal development and strategic partnerships while maintaining significant development and commercial rights.

We presently have two key product candidates in clinical trials, tipifarnib and KO-539.

References in these Notes to Unaudited Condensed Financial Statements to the “Company,” “we,” “our” or “us,” refer to Kura Oncology, Inc.

19 unchanged sentences

Under the terms of an office lease entered into in March 2020, we are required to maintain a standby letter of credit during the term of the lease.

As of June 30, 2020, restricted cash of $ 0.2 million was pledged as collateral for the letter of credit.

As of September 30, 2020, restricted cash of $ 0.2 million was pledged as collateral for the letter of credit.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the unaudited condensed balance sheets that sum to the total of the amounts shown in the unaudited condensed statements of cash flows, in thousands:

June 30, 2020

September 30, 2020

December 31, 2019

June 30, 2019

September 30, 2019

December 31, 2018

6 unchanged sentences

For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the antidilutive effect of the securities.

More specifically, for the three and six months ended June 30, 2020 and 2019 , outstanding stock options, an outstanding warrant and employee stock purchase plan rights totaling approximately 5,141,000 shares and 4,140,000 shares, respectively, were excluded from the calculation of diluted net loss per share because to do so would be anti-dilutive.

More specifically, for the three and nine months ended September 30, 2020 and 2019 , outstanding stock options, an outstanding warrant and employee stock purchase plan rights totaling approximately 5,178,000 shares and 4,099,000 shares, respectively, were excluded from the calculation of diluted net loss per share because to do so would be anti-dilutive.

Recent Accounting Pronouncements

9 unchanged sentences

The following tables summarize, by major security type, our investments that are measured at fair value on a recurring basis, in thousands:

June 30, 2020

September 30, 2020

Cash equivalents:

2 unchanged sentences

Treasury securities

Corporate debt securities

Commercial paper

Corporate debt securities

Total short-term investments

4 unchanged sentences

Treasury securities

Corporate debt securities

Commercial paper

Corporate debt securities

Total short-term investments

The available-for-sale investments are classified as current assets, even though the stated maturity date may be one year or more beyond the current balance sheet date, which reflects management’s intention to use the proceeds from sales of these securities to fund our operations, as necessary.

As of June 30, 2020, all of our short-term investments had maturities less than one year.

Realized gains and losses were de minimus for the three and six months ended June 30, 2020.

As of September 30, 2020, all of our short-term investments had maturities less than one year.

Realized gains and losses were de minimus for the three and nine months ended September 30, 2020.

We evaluate our available-for-sale debt securities for credit losses when the amortized cost basis exceeds fair value.

2 unchanged sentences

When evaluating an investment for impairment, we review factors such as the severity of the impairment, changes in underlying credit ratings, forecasted recovery, our intent to sell or the likelihood that we would be required to sell the investment before its anticipated recovery in market value and the probability that the scheduled cash payments will continue to be made.

As of June 30, 2020, marketable securities with a fair market value of $ 40.7 million were in immaterial gross unrealized loss positions.

Based on our review of these securities, we believe none of the unrealized loss is a result of a credit loss as of June 30, 2020 because we do not intend to sell these securities and it is not more-likely-than-not that we will be required to sell these securities prior to recovery of their amortized cost basis.

As of September 30, 2020, marketable securities with a fair market value of $ 8.1 million were in immaterial gross unrealized loss positions.

Based on our review of these securities, we believe none of the unrealized loss is a result of a credit loss as of September 30, 2020 because we do not intend to sell these securities and it is not more-likely-than-not that we will be required to sell these securities prior to recovery of their amortized cost basis.

Fair Value Measurements

As of June 30, 2020 and December 31, 2019, we had cash equivalents and short-term investments measured at fair value on a recurring basis.

As of September 30, 2020 and December 31, 2019, we had cash equivalents and short-term investments measured at fair value on a recurring basis.

Available-for-sale marketable securities consist of U.S.

4 unchanged sentences

The following tables summarize, by major security type, our cash equivalents and short-term investments that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy, in thousands:

June 30, 2020

September 30, 2020

Cash equivalents:

2 unchanged sentences

Treasury securities

Corporate debt securities

Commercial paper

Corporate debt securities

Total short-term investments

4 unchanged sentences

Treasury securities

Corporate debt securities

Commercial paper

Corporate debt securities

Total short-term investments

3 unchanged sentences

Property and equipment consisted of the following, in thousands:

June 30, 2020

September 30, 2020

December 31, 2019

6 unchanged sentences

Accounts payable and accrued liabilities consisted of the following, in thousands:

June 30, 2020

September 30, 2020

December 31, 2019

23 unchanged sentences

For accounting purposes, the lease commencement date was determined to be March 2020 when we had control of the office space.

We recorded an operating lease right-of-use, or ROU, asset and operating lease liability of approximately $ 2.1 million on our unaudited condensed balance sheet.

We recorded an operating lease right-of-use, or ROU, asset and operating lease liability of approximately $ 2.2 million on our unaudited condensed balance sheet on the lease commencement date in the first quarter of 2020.

In March 2020, we entered into a lease agreement for office space in Boston, Massachusetts, or the Boston Lease, which commenced on April 1, 2020 and expires on July 31, 2024 .

3 unchanged sentences

Under the terms of the Boston Lease, we are required to maintain a standby letter of credit of approximately $ 0.2 million during the term of the lease.

We recorded an operating lease ROU asset and operating lease liability of approximately $ 5.1 million on our unaudited condensed balance sheet.

We recorded an operating lease ROU asset and operating lease liability of approximately $ 5.1 million on our unaudited condensed balance sheet on the lease commencement date in the second quarter of 2020.

In May 2020, we entered into a two-year sublease for certain designated lab space in San Diego, California, which commenced on June 9, 2020 .

1 unchanged sentence

We are not obligated to pay for common area maintenance and other costs.

We recorded an operating lease ROU asset and operating lease liability of approximately $ 0.3 million on our unaudited condensed balance sheet.

Maturities of lease liabilities as of June 30, 2020 are as follows, in thousands:

We recorded an operating lease ROU asset and operating lease liability of approximately $ 0.3 million on our unaudited condensed balance sheet on the lease commencement date in the second quarter of 2020.

Maturities of lease liabilities as of September 30, 2020 are as follows, in thousands:

Year Ending December 31,

3 unchanged sentences

Total operating lease liabilities

Includes the remaining tenant incentives of $ 0.5 million to be received from the landlord in 2020.

As of December 31, 2019, we had remaining lease liabilities of approximately $ 0.3 million which will mature in 2020.

ROU assets are recorded in other long-term assets on our unaudited condensed balance sheets.

Current and non-current lease liabilities are recorded in accounts payable and accrued expenses and other long-term liabilities, respectively, on our unaudited condensed balance sheets.

As of June 30, 2020 and December 31, 2019, total operating lease ROU assets were $ 7.1 million and $ 0.2 million, respectively.

As of June 30, 2020 and December 31, 2019, total operating lease liabilities were $ 7.8 million and $ 0.3 million, respectively, $ 6.0 million of which was recorded as noncurrent lease liability as of June 30, 2020.

As of June 30, 2020 and December 31, 2019, the weighted-average discount rate was 5.5 % and 6.5 %, respectively.

As of June 30, 2020 and December 31, 2019, the weighted-average remaining lease term was 4.5 years and 0.5 years, respectively.

Total cash paid for amounts included in the measurement of lease liabilities, net of tenant improvement reimbursements, was $ 0.1 million and $ 0.2 million for the six months ended June 30, 2020 and 2019, respectively.

ROU assets obtained in exchange for operating lease liabilities were $ 7.5 million and $ 0.7 million for the six months ended June 30, 2020 and 2019, respectively.

Total operating lease expense was approximately $ 0.6 million and $ 0.1 million for the three months ended June 30, 2020 and 2019, respectively.

Total operating lease expense was approximately $ 0.7 million and $ 0.2 million for the six months ended June 30, 2020 and 2019, respectively.

As of September 30, 2020 and December 31, 2019, total operating lease ROU assets were $ 6.7 million and $ 0.2 million, respectively.

As of September 30, 2020 and December 31, 2019, total operating lease liabilities were $ 7.9 million and $ 0.3 million, respectively, $ 6.0 million of which was recorded as noncurrent lease liability as of September 30, 2020.

As of September 30, 2020 and December 31, 2019, the weighted-average discount rate was 5.5 % and 6.5 %, and the weighted-average remaining lease term was 4.3 years and 0.5 years, respectively.

Total cash paid for amounts included in the measurement of lease liabilities, net of tenant improvement reimbursements, was $ 0.1 million and $ 0.4 million for the nine months ended September 30, 2020 and 2019, respectively.

ROU assets obtained in exchange for operating lease liabilities were $ 7.5 million and $ 0.7 million for the nine months ended September 30, 2020 and 2019, respectively.

Total operating lease expense was approximately $ 0.5 million and $ 0.1 million for the three months ended September 30, 2020 and 2019, respectively.

Total operating lease expense was approximately $ 1.2 million and $ 0.4 million for the nine months ended September 30, 2020 and 2019, respectively.

We have entered into short-term operating leases that are not recorded on the unaudited condensed balance sheet.

Total rent expense of all operating leases for the three months ended June 30, 2020 and 2019 was approximately $ 0.6 million and $ 0.1 million, respectively.

Total rent expense of all operating leases for the six months ended June 30, 2020 and 2019 was approximately $ 0.9 million and $ 0.3 million, respectively.

Total rent expense of all operating leases for the three months ended September 30, 2020 and 2019 was approximately $ 0.5 million and $ 0.1 million, respectively.

Total rent expense of all operating leases for the nine months ended September 30, 2020 and 2019 was approximately $ 1.4 million and $ 0.4 million, respectively.

Stockholders’ Equity

6 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Research and development

1 unchanged sentence

Total share-based compensation expense

As of June 30, 2020, unrecognized compensation costs related to employee stock options was approximately $ 28.6 million, which is expected to be recognized over a weighted average period of approximately 2.8 years.

As of September 30, 2020, unrecognized compensation costs related to employee stock options was approximately $ 31.6 million, which is expected to be recognized over a weighted average period of approximately 2.8 years.

Related Party Transactions

Our president and chief executive officer is also the sole managing member of Araxes Pharma LLC, or Araxes, and is a significant stockholder of each of us and Araxes.

The following is a summary of related party transactions for the three and six months ended June 30, 2020 and 2019:

The following is a summary of related party transactions for the three and nine months ended September 30, 2020 and 2019:

Facility Sublease

4 unchanged sentences

The Sublease was terminated in June 2020 .

For the three months ended June 30, 2020 and 2019, rent expense, including operating costs, related to our sublease was approximately $ 0.1 million in both periods.

For the six months ended June 30, 2020 and 2019, rent expense, including operating costs, related to our Sublease was approximately $ 0.2 million in both periods.

For the three months ended September 30, 2020 and 2019, rent expense, including operating costs, related to our sublease was approximately nil and $ 0.1 million, respectively.

For the nine months ended September 30, 2020 and 2019, rent expense, including operating costs, related to our Sublease was approximately $ 0.2 million and $ 0.3 million, respectively.

Management Fees

We have a management services agreement with Araxes pursuant to which Araxes pays us monthly fees for management services calculated based on costs incurred by us in the provision of services to Araxes, plus a reasonable mark-up.

For the three months ended June 30, 2020 and 2019, we recorded approximately $ 0.1 million in management fee income in both periods.

For the six months ended June 30, 2020 and 2019, we recorded approximately $ 0.1 million and $ 0.2 million in management fee income, respectively.

For the three months ended September 30, 2020 and 2019, we recorded approximately $ 0.1 million in management fee income in both periods.

For the nine months ended September 30, 2020 and 2019, we recorded approximately $ 0.1 million and $ 0.2 million in management fee income, respectively.

In addition, the agreement allows for Araxes to reimburse us an amount equal to the number of full-time equivalents, or FTE, performing research and development services for Araxes, at an annual FTE rate of approximately $ 382,000 , plus actual expenses as reasonably incurred.

1 unchanged sentence

The agreement may be terminated by either party with a notice of at least 30 days prior to the expiration of the then-renewal term.

For the three and six months ended June 30, 2020 and 2019, we recorded reimbursements of nil and approximately $ 0.1 million, respectively, for research and development services provided to Araxes, which was recorded as a reduction to research and development expenses, on our unaudited condensed statements of operations and comprehensive loss.

For the three and nine months ended September 30, 2020 and 2019, we recorded de minimus reimbursements in each period, which was recorded as a reduction to research and development expenses, on our unaudited condensed statements of operations and comprehensive loss.

Services Agreement

2 unchanged sentences

The agreement may be terminated by either party with a notice of at least 30 days prior to the expiration of the then-renewal term.

For the three and six months ended June 30, 2020 and 2019, we recognized approximately $ 0.1 million in each period, from research and development services provided to us under this agreement as research and development expense on our unaudited condensed statements of operations and comprehensive loss.

For the three months ended September 30, 2020 and 2019, we recognized approximately nil and $ 0.1 million from research and development services provided to us under this agreement as research and development expense on our unaudited condensed statements of operations and comprehensive loss.

For the nine months ended September 30, 2020 and 2019, we recognized approximately $ 0.1 million in both periods.

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 1. Financial Statements