What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-11-03 compared with 2022-08-04 · 123 added, 79 removed, 416 unchanged (33% of the section changed)

3 unchanged sentences

(Amounts in thousands, except share and per share amounts)

June 30, 2022 March 31, 2022

September 30, 2022 March 31, 2022

Current assets:

23 unchanged sentences

Common stock, $ 0.001 par value;

150,000,000 shares authorized as of June 30, 2022 and March 31, 2022;

49,298,467 and 47,338,660 shares issued and outstanding as of June 30, 2022 and March 31, 2022, respectively

150,000,000 shares authorized as of September 30, 2022 and March 31, 2022;

49,739,407 and 47,338,660 shares issued and outstanding as of September 30, 2022 and March 31, 2022, respectively

Additional paid-in capital 777,650 723,359

7 unchanged sentences

(Amounts in thousands, except share and per share amounts)

Three Months Ended June 30,

Three Months Ended September 30, Six Months Ended September 30,

2022 2021 2022 2021

Operating expenses:

16 unchanged sentences

(Amounts in thousands)

Three Months Ended June 30,

Three Months Ended September 30, Six Months Ended September 30,

2022 2021 2022 2021

Net loss $ ( 43,102 ) $ ( 29,355 ) $ ( 85,355 ) $ ( 56,666 )

1 unchanged sentence

Foreign currency translation gain 2,330 219 4,067 443

Net unrealized loss on short-term investments, net of tax of $ 0

Net unrealized gain (loss) on short-term investments, net of tax of $ 0

81 — ( 163 ) ( 40 )

19 unchanged sentences

Balances as of June 30, 2022 49,298,467 49 763,150 ( 353,457 ) 520 410,262

Issuance of common stock through ATM sales, net of offering costs 340,000 1 6,400 — — 6,401

Foreign currency translation adjustment — — — — 2,330 2,330

Unrealized loss on short-term investments — — — — 81 81

Exercise of stock options 88,252 — 1,108 — — 1,108

Vesting of RSUs 12,688 — — — — —

Stock-based compensation expense — — 6,992 — — 6,992

Net loss — — — ( 43,102 ) — ( 43,102 )

Balances as of September 30, 2022 49,739,407 50 777,650 ( 396,559 ) 2,931 384,072

Balances as of March 31, 2021 46,566,481 $ 47 $ 692,243 $ ( 193,168 ) $ ( 394 ) $ 498,728

5 unchanged sentences

Balances as of June 30, 2021 46,730,451 47 699,666 ( 220,479 ) ( 210 ) 479,024

Foreign currency translation adjustment — — — — 219 219

Unrealized loss on short-term investments — — — — — —

Exercise of stock options 124,880 — 1,211 — — 1,211

Stock-based compensation expense — — 6,313 — — 6,313

Net loss — — — ( 29,355 ) — ( 29,355 )

Balances as of September 30, 2021 46,855,331 47 707,190 ( 249,834 ) 9 457,412

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

2 unchanged sentences

(Amounts in thousands)

Three Months Ended June 30,

Six Months Ended September 30,

Cash flows from operating activities:

24 unchanged sentences

Effect of exchange rate changes on cash, cash equivalents and restricted cash 4,351 516

Net increase in cash, cash equivalents and restricted cash 6,297 10,010

Net decrease in cash, cash equivalents and restricted cash ( 17,018 ) ( 22,549 )

Cash, cash equivalents and restricted cash at beginning of period 107,584 184,154

16 unchanged sentences

and Replimune (Ireland) Limited.

The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations and the ability to secure additional capital to fund operations.

The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, third-party intellectual property, compliance with government regulations and the ability to secure additional capital to fund operations.

Product candidates currently under development will require significant additional research and development efforts, including preclinical and clinical testing and regulatory approval, prior to commercialization.

3 unchanged sentences

The accompanying consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business.

The Company has incurred recurring losses since its inception, including net losses of $ 42.3 million and $ 27.3 million for the three months ended June 30, 2022 and 2021, respectively.

In addition, as of June 30, 2022, the Company had an accumulated deficit of $ 353.5 million.

The Company has incurred recurring losses since its inception, including net losses of $ 43.1 million and $ 29.4 million for the three months ended September 30, 2022 and 2021, respectively and net losses of $ 85.4 million and $ 56.7 million for the six months ended September 30, 2022 and 2021, respectively.

In addition, as of September 30, 2022, the Company had an accumulated deficit of $ 396.6 million.

The Company expects to continue to generate operating losses for the foreseeable future.

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The impact of this pandemic has been, and may continue to be, extensive in many aspects of society, which has resulted, and may continue to result, in significant disruptions to the global economy as well as businesses and capital markets around the world.

The Company is continuing to monitor the global outbreak and spread of COVID-19 and, throughout the pandemic, has implemented measures designed to comply with applicable federal, state and local guidelines, as well as care for our employee's health and well-being.

The Company is continuing to generally monitor the spread of COVID-19 and, throughout the pandemic, has implemented measures designed to comply with applicable federal, state and local guidelines, as well as care for the Company's employee's health and well-being.

The Company will continue to examine its protocols as the pandemic and health guidance evolves.

The COVID-19 pandemic continues to affect the United States and global economies and has affected and may continue to affect the Company's operations and those of third parties on which it relies, including by causing disruptions in our raw material and supply of other materials, the manufacturing of its product candidates and its commercialization processes.

However, the extent of these delays is currently unknown and has and will likely continue to vary.

1 unchanged sentence

The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company's business, results of operations and financial condition will depend on future developments that are highly uncertain and cannot be accurately predicted, including new information that may emerge concerning COVID-19, the actions taken in an effort to contain it or to potentially treat or continue to vaccinate against COVID-19 and the economic impact on local, regional, national and international markets.

The Company continues to actively monitor this situation and the possible effects on its financial condition, liquidity, operations, suppliers, supplies, industry and workforce.

The Company continues to monitor this situation and the possible effects on its financial condition, liquidity, operations, suppliers, supplies, industry and workforce.

Summary of significant accounting policies

11 unchanged sentences

Unaudited interim financial information

The accompanying consolidated balance sheet as of June 30, 2022, the consolidated statements of operations, of comprehensive loss and of stockholders’ equity for the three months ended June 30, 2022 and 2021 and the consolidated statements of cash flows for the three months ended June 30, 2022 and 2021 are unaudited.

The unaudited interim consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of June 30, 2022 and the results of its operations for the three months ended June 30, 2022 and 2021 and its cash flows for the three months ended June 30, 2022 and 2021.

The financial data and other information disclosed in these consolidated notes related to the three months ended June 30, 2022 and 2021 are unaudited.

The results for the three months ended June 30, 2022 are not necessarily indicative of results to be expected for the year ending March 31, 2023, any other interim periods or any future year or period.

The accompanying consolidated balance sheet as of September 30, 2022, the consolidated statements of operations, of comprehensive loss and of stockholders’ equity for the three and six months ended September 30, 2022 and 2021 and the consolidated statements of cash flows for the six months ended September 30, 2022 and 2021 are unaudited.

The unaudited interim consolidated financial statements have been prepared on the same basis as the audited annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of September 30, 2022 and the results of its operations for the three and six months ended September 30, 2022 and 2021 and its cash flows for the six months ended September 30, 2022 and 2021.

The financial data and other information disclosed in these consolidated notes related to the three and six months ended September 30, 2022 and 2021 are unaudited.

The results for the three and six months ended September 30, 2022 are not necessarily indicative of results to be expected for the year ending March 31, 2023, any other interim periods or any future year or period.

The financial information included herein should be read in conjunction with the financial statements and notes in the Company's Annual Report on Form 10-K for the year ended March 31, 2022, which was filed with the Securities and Exchange Commission on May 19, 2022 (the "Annual Report").

During the three months ended June 30, 2022, there have been no changes to the Company’s significant accounting policies as described in the Annual Report, except as described below.

During the three and six months ended September 30, 2022, there have been no changes to the Company’s significant accounting policies as described in the Annual Report, except as described below.

Recently adopted accounting pronouncements

8 unchanged sentences

Fair Value Measurements as of

June 30, 2022 Using:

September 30, 2022 Using:

Level 1 Level 2 Level 3 Total

11 unchanged sentences

The underlying securities in the money market funds held by the Company are all government backed securities.

During the three months ended June 30, 2022 and 2021, there were no transfers between levels.

During the three and six months ended September 30, 2022 and 2021, there were no transfers between levels.

Valuation of cash equivalents and short-term investments

2 unchanged sentences

Treasury bonds were valued by the Company using quoted prices in active markets for similar securities, which represent a Level 2 measurement within the fair value hierarchy.

Cash equivalents consisted of money market funds at June 30, 2022 and March 31, 2022.

Cash equivalents consisted of money market funds at September 30, 2022 and March 31, 2022.

Short-term investments

As of June 30, 2022 and March 31, 2022, the Company's available-for-sale investments by type consisted of the following:

June 30, 2022

As of September 30, 2022 and March 31, 2022, the Company's available-for-sale investments by type consisted of the following:

September 30, 2022

cost Gross unrealized

9 unchanged sentences

Total $ 290,989 $ — $ ( 1,282 ) $ — $ 289,707

As of June 30, 2022, available-for-sale securities consisted of investments that mature within one year.

As of September 30, 2022, available-for-sale securities consisted of investments that mature within one year.

As of March 31, 2022, available-for-sale securities consisted of investments that mature within one year, with the exception of certain U.S.

3 unchanged sentences

Property, plant and equipment, net consisted of the following:

June 30, 2022 March 31, 2022

September 30, 2022 March 31, 2022

Office equipment $ 995 $ 937

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Property, plant and equipment, net $ 7,910 $ 7,933

Depreciation expense was $ 620 and $ 518 for the three months ended June 30, 2022 and 2021, respectively.

Depreciation expense are recorded within research and development and selling, general and administrative expenses in the consolidated statement of operations.

Depreciation expense was $ 617 and $ 1,237 for the three and six months ended September 30, 2022 and $ 532 and $ 1,050 for the three and six months ended September 30, 2021, respectively.

Depreciation expense is recorded within research and development and selling, general and administrative expenses in the consolidated statement of operations.

Accrued expenses and other current liabilities

Accrued expenses and other current liabilities consisted of the following:

June 30, 2022 March 31, 2022

September 30, 2022 March 31, 2022

Accrued research and development costs $ 8,224 $ 5,882

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Stockholders’ equity

As of June 30, 2022 and March 31, 2022, the Company’s certificate of incorporation, as amended and restated, authorized the Company to issue up to 150,000,000 shares of common stock, par value $ 0.001 per share.

As of June 30, 2022 and March 31, 2022, the Company had reserved 18,963,578 and 16,605,804 shares of common stock for the exercise of outstanding stock options and the vesting of restricted share units, the number of shares remaining available for grant under the Company’s 2018 Omnibus Incentive Compensation Plan and the Company’s Employee Stock Purchase Plan (see Note 8) and the exercise of the outstanding warrants to purchase shares of common stock, respectively.

As of September 30, 2022 and March 31, 2022, the Company’s certificate of incorporation, as amended and restated, authorized the Company to issue up to 150,000,000 shares of common stock, par value $ 0.001 per share.

As of September 30, 2022 and March 31, 2022, the Company had reserved 18,862,638 and 16,605,804 shares of common stock for the exercise of outstanding stock options and the vesting of restricted share units, the number of shares remaining available for grant under the Company’s 2018 Omnibus Incentive Compensation Plan and the Company’s Employee Stock Purchase Plan (see Note 8) and the exercise of the outstanding warrants to purchase shares of common stock, respectively.

Undesignated preferred stock

As of June 30, 2022, the Company’s certificate of incorporation, as amended and restated, authorized the Company to issue up to 10,000,000 shares of undesignated preferred stock, par value $ 0.001 per share.

There were no undesignated preferred shares issued or outstanding as of June 30, 2022.

On August 11, 2020, the Company and the SVB Leerink LLC (the "Agent") entered into a sales agreement, which was subsequently amended on October 21, 2020 (as amended, the “2020 Sales Agreement”), pursuant to which the Company could sell, from time to time, at its option, up to an aggregate of $ 62,500 of shares of the Company’s common stock, $ 0.001 par value per share, through the Agent, as the Company’s sales agent.

During the three months ended June 30, 2022, the Company settled transactions that occurred pursuant to the 2020 Sales Agreement, whereby the Company issued and sold an aggregate of 1,686,438 shares of its common stock, resulting in gross proceeds of $ 32.0 million, before deducting fees of $ 1.0 million.

The Company did no t issue or sell any shares under the 2020 Sales Agreement during the year ended March 31, 2022.

As of September 30, 2022, the Company’s certificate of incorporation, as amended and restated, authorized the Company to issue up to 10,000,000 shares of undesignated preferred stock, par value $ 0.001 per share.

There were no undesignated preferred shares issued or outstanding as of September 30, 2022.

On August 11, 2020, the Company and the SVB Leerink LLC (the "Agent") entered into a sales agreement, which was subsequently amended on October 21, 2020 (as amended, the “2020 Sales Agreement”), pursuant to which the Company could sell, from time to time, at its option, up to an aggregate of $ 62.5 million of shares of the Company’s common stock, $ 0.001 par value per share, through the Agent, as the Company’s sales agent.

During the six months ended September 30, 2022, the Company settled transactions that occurred pursuant to the 2020 Sales Agreement, whereby the Company issued and sold an aggregate of 1,686,438 shares of its common stock, resulting in gross proceeds of $ 32.0 million, before deducting fees of $ 1.0 million.

The Company did no t issue or sell any shares under the 2020 Sales Agreement during the six months ended September 30, 2021.

On June 23, 2022, the 2020 Sales Agreement was terminated by the execution by the Company and the Agent of a new sales agreement (the “2022 Sales Agreement”).

Under the 2022 Sales Agreement, the Company may sell, from time to time, at its option, up to an aggregate of $ 100,000 of shares of the Company’s common stock, $ 0.001 par value per share (the “Shares”), through the Agent, as the Company’s sales agent.

Any Shares to be offered and sold under the 2022 Sales Agreement will be issued and sold (i) by methods deemed to be an “at the market offering” (“ATM”) as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended, or if authorized by the Company, in negotiated transactions or block trades, and (ii) pursuant to a registration statement on Form S-3 filed by the Company with the Securities and Exchange Commission on June 23, 2022 for an offering of up to $ 400,000 of various securities, including shares of the Company’s common stock, preferred stock, debt securities, warrants and/or units for sale to the public in one or more public offerings.

Under the 2022 Sales Agreement, the Company may sell, from time to time, at its option, up to an aggregate of $ 100.0 million of shares of the Company’s common stock, $ 0.001 par value per share (the “Shares”), through the Agent, as the Company’s sales agent.

Any Shares to be offered and sold under the 2022 Sales Agreement will be issued and sold (i) by methods deemed to be an “at the market offering” (“ATM”) as defined in Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended, or if authorized by the Company, in negotiated transactions or block trades, and (ii) pursuant to a registration statement on Form S-3 filed by the Company with the Securities and Exchange Commission on June 23, 2022 for an offering of up to $ 400.0 million of various securities, including shares of the Company’s common stock, preferred stock, debt securities, warrants and/or units for sale to the public in one or more public offerings.

Subject to the terms of the 2022 Sales Agreement, the Agent will use reasonable efforts to sell the Shares from time to time, based upon the Company’s instructions (including any price, time or size limits or other customary parameters or conditions the Company may impose).

The Company cannot provide any assurances that it will issue any additional Shares pursuant to the 2022 Sales Agreement.

The Company will pay the Agent a commission of up to 3.0 % of the gross proceeds from the sale of the Shares.

The Company has also agreed to provide the Agent with customary indemnification rights.

During the three months ended September 30, 2022, pursuant to the 2022 Sales Agreement, the Company issued and sold an aggregate of 340,000 shares of its common stock, resulting in gross proceeds of $ 6.7 million, before deducting fees of $ 0.2 million.

The Company cannot provide any assurances that it will issue any additional Shares pursuant to the 2022 Sales Agreement.

Equity offerings

5 unchanged sentences

Unless otherwise modified by a holder of a pre-funded warrant, no holder may exercise a pre-funded warrant if such holder, together with its affiliates, would beneficially own more than 9.99 % of the number of shares of the Company’s common stock outstanding immediately after giving effect to such exercise.

A holder a pre-funded warrant may increase or decrease this percentage up to 19.99 % by providing at least 61 days’ prior notice to the Company.

A holder of a pre-funded warrant may increase or decrease this percentage up to 19.99 % by providing at least 61 days’ prior notice to the Company.

Certain holders have decreased the 9.99 % threshold to a 4.99 % threshold.

Other than as set forth in Note 8 and Note 9 to these consolidated financial statements, the 3,084,238 shares of the Company's common stock underlying the above described pre-funded warrants, and the 2,200,000 shares of the Company's common stock underlying pre-funded warrants that were issued by the Company in 2019, are not included in the number of issued and outstanding shares of the Company’s common stock set forth herein.

As of June 30, 2022, no pre-funded warrants had been exercised.

As of September 30, 2022, no pre-funded warrants had been exercised.

Stock-based compensation

2 unchanged sentences

Three Months Ended

September 30, Six Months Ended

September 30,

2022 2021 2022 2021

Research and development $ 2,529 $ 2,227 $ 5,143 $ 4,685

1 unchanged sentence

$ 6,992 $ 6,313 $ 14,186 $ 12,563

The following table summarizes stock-based compensation expense by award type for the three months ended June 30, 2022 and 2021:

The following table summarizes stock-based compensation expense by award type for the three months ended September 30, 2022 and 2021:

Three Months Ended

September 30, Six Months Ended September 30,

2022 2021 2022 2021

Stock options $ 4,845 $ 5,093 $ 10,004 $ 10,268

12 unchanged sentences

Restricted stock awards and non-statutory stock options were granted under the 2017 Plan to employees, officers, members of the board of directors, advisors and consultants of the Company.

The maximum number of common shares that may be issued under the 2017 Plan was 2,659,885 , of which no ne remained available for future grants as of June 30, 2022.

The maximum number of common shares that may be issued under the 2017 Plan was 2,659,885 , of which no ne remained available for future grants as of September 30, 2022.

Shares with respect to which awards have expired, terminated, surrendered or cancelled under the 2017 Plan without having been fully exercised will be available for future awards under the 2018 Plan referenced below.

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If any options or stock appreciation rights, including outstanding options and stock appreciation rights granted under the 2017 Plan (up to 2,520,247 shares), terminate, expire, or are canceled, forfeited, exchanged, or surrendered without having been exercised, or if any stock awards, stock units or other stock-based awards, including outstanding awards granted under the 2017 Plan, are forfeited, terminated, or otherwise not paid in full in shares of common stock, the shares of the Company’s common stock subject to such grants will be available for purposes of the 2018 Plan.

The number of shares reserved for issuance under the 2018 Plan will increase automatically on the first day of each April equal to 4.0 % of the total number of shares of Company stock outstanding on the last trading day in the immediately preceding fiscal year, which includes for these purposes, the 5,284,238 shares issuable upon exercise of those pre-funded warrants described in Note 7 to these consolidated financial statements, or such lesser amount as determined by the Board.

On April 1, 2022, the number of shares reserved for issuance under the 2018 Plan automatically increased by 2,104,915 shares pursuant to the terms of the 2018 Plan and based on total number of shares of Company stock outstanding on March 31, 2022.

The number of shares reserved for issuance under the 2018 Plan will increase automatically on the first day of each April equal to 4.0 % of the total number of shares of common stock outstanding on the last trading day in the immediately preceding fiscal year, which includes for these purposes, the 5,284,238 shares issuable upon exercise of those pre-funded warrants described in Note 7 to these consolidated financial statements, or such lesser amount as determined by the Board.

On April 1, 2021, the number of shares reserved for issuance under the 2018 Plan automatically increased by 2,074,028 shares pursuant to the terms of the 2018 Plan.

As of June 30, 2022, 2,337,711 shares remained available for future grants under the 2018 Plan.

As of September 30, 2022, 2,327,646 shares remained available for future grants under the 2018 Plan.

The 2015 Plan, the 2017 Plan and the 2018 Plan are administered by the board of directors or, at the discretion of the board of directors, by a committee of the board of directors.

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Three Months Ended

September 30, Six Months Ended

September 30,

2022 2021 2022 2021

Risk-free interest rate 3.08 % 0.96 % 2.61 % 1.11 %

11 unchanged sentences

Cancelled ( 214,482 ) $ 22.30

Outstanding as of June 30, 2022 7,511,559 $ 17.01 7.47 $ 31,884

Outstanding as of September 30, 2022 7,413,466 $ 16.98 7.31 $ 30,477

Options exercisable as of March 31, 2022 3,645,749 $ 10.85 6.31 $ 24,875

Options exercisable as of June 30, 2022 4,144,044 $ 13.15 6.36 $ 26,859

As of June 30, 2022, there was $ 46.3 million of unrecognized compensation cost related to unvested common stock options, which is expected to be recognized over a weighted average period of 2.7 years.

The weighted average grant-date fair value of stock options granted during the three months ended June 30, 2022 and 2021 was $ 12.15 and $ 22.29 , respectively.

The aggregate intrinsic value of stock options exercised during the three months ended June 30, 2022 was $ 0.5 million.

Options exercisable as of September 30, 2022 4,291,654 $ 13.50 6.31 $ 26,428

As of September 30, 2022, there was $ 41.7 million of unrecognized compensation cost related to unvested common stock options, which is expected to be recognized over a weighted average period of 2.5 years.

The weighted average grant-date fair value of stock options granted during the six months ended September 30, 2022 and 2021 was $ 12.20 and $ 22.25 , respectively.

The aggregate intrinsic value of stock options exercised during the six months ended September 30, 2022 was $ 1.2 million.

Restricted stock units

A summary of the changes in the Company's RSUs during the three months ended June 30, 2022 is as follows:

A summary of the changes in the Company's RSUs during the three months ended September 30, 2022 is as follows:

Number of Restricted Shares Weighted

4 unchanged sentences

Cancelled ( 57,985 ) 27.12

Outstanding as of June 30, 2022 1,256,123 24.74

As of June 30, 2022, there was $ 29.0 million of unrecognized compensation cost related to unvested restricted stock units, which is expected to be recognized over a weighted average period of 3.4 years.

As of June 30, 2021, there was $ 20.9 million unrecognized compensation cost related to unvested restricted stock units .

Outstanding as of September 30, 2022 1,263,341 24.49

As of September 30, 2022, there was $ 27.1 million of unrecognized compensation cost related to unvested restricted stock units, which is expected to be recognized over a weighted average period of 3.2 years.

As of September 30, 2021, there was $ 20.7 million unrecognized compensation cost related to unvested restricted stock units .

Net loss per share

Basic and diluted net loss per share attributable to common stockholders was calculated as follows:

Three Months Ended June 30,

Three Months Ended September 30, Six Months Ended September 30,

2022 2021 2022 2021

Net loss $ ( 43,102 ) $ ( 29,355 ) $ ( 85,355 ) $ ( 56,666 )

1 unchanged sentence

Net loss per share, basic and diluted $ ( 0.79 ) $ ( 0.56 ) $ ( 1.57 ) $ ( 1.09 )

The November 2019 Pre-Funded Warrants, the June 2020 Pre-Funded Warrants and the October 2020 Pre-Funded Warrants are included as outstanding common stock in the calculation of basic and diluted net loss per share.

The 5,284,238 share of the Company's common stock issuable upon exercise of the November 2019 Pre-Funded Warrants, the June 2020 Pre-Funded Warrants and the October 2020 Pre-Funded Warrants described in Note 7 to these consolidated financial statements are included as outstanding common stock in the calculation of basic and diluted net loss per share.

The Company’s potentially dilutive securities, which include stock options and warrants to purchase common stock have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share.

1 unchanged sentence

The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect:

Three Months Ended June 30,

Three and Six Months Ended September 30,

Options to purchase common stock 7,413,466 6,998,097

5 unchanged sentences

Pursuant to the agreement, BMS will provide to the Company, at no cost, a compound for use in the Company’s ongoing clinical trial of RP1.

Under the agreement, the Company will sponsor, fund and conduct the clinical trial in accordance with an agreed-upon

Under the agreement, the Company will sponsor, fund and conduct the clinical trial in accordance with an agreed-upon protocol.

BMS granted the Company a non-exclusive, non-transferrable, royalty-free license (with a right to sublicense) under its intellectual property to its compound in the clinical trial and agreed to supply its compound, at no cost to the Company, for use in the clinical trial.

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Pursuant to the agreement, the Company and Regeneron will undertake one or more clinical trials using a combination of the compounds being developed by each entity.

Under the agreement, each study will be conducted under terms set out in a separately agreed upon study plan that will identify the name of the sponsor and which party will manage the particular clinical trial, and include the protocol, the budget and a schedule of clinical obligations.

Under the agreement, each clinical trial will be conducted under terms set out in a separately agreed upon study plan that will identify the name of the sponsor and which party will manage the particular clinical trial, and include the protocol, the budget and a schedule of clinical obligations.

In June 2018, under the terms of the agreement between the Company and Regeneron, the parties agreed to the first study plan.

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The Company and Regeneron are in communication regarding receiving Regeneron's acknowledgement of the sharing of the study costs according to the current budget that superseded that of the initial study plan and initial budget.

The true-up cost in discussion for the period ending June 30, 2022 is $ 1.4 million to the Company, which have not been recorded in prepaid expenses and other current assets in the consolidated balance sheet or as an offset to research and development expense within the consolidated statement of operations.

During the three months ended June 30, 2022 and 2021, the Company did not make any payments to Regeneron under the terms of the agreement.

During the three months ended June 30, 2022 and 2021, the Company received payments under the terms of the agreement from Regeneron of $ 2.0 million and $ 1.3 million, respectively.

As of June 30, 2022 and March 31, 2022, the Company recorded $ 1.1 million and $ 2.0 million of receivables from Regeneron in connection with this agreement in prepaid expenses and other current assets in the consolidated balance sheet, respectively.

As a result of this notice from, and the ongoing communications with, Regeneron, the Company has not recorded any cost-sharing reimbursements from Regeneron in prepaid expenses and other current assets in the consolidated balance sheet or as an offset to research and development expense within the consolidated statement of operations since Regeneron informed the Company that Regeneron’s reimbursement of CERPASS study costs to the Company have completed.

During the six months ended September 30, 2022 and 2021, the Company recorded $ 1.1 million and $ 2.9 million, respectively as an offset to research and development expenses.

During the three and six months ended September 30, 2022 and 2021, the Company did not make any payments to Regeneron under the terms of the agreement.

During the six months ended September 30, 2022 and 2021, the Company received payments under the terms of the agreement from Regeneron of $ 2.0 million and $ 2.7 million, respectively.

As of September 30, 2022 and March 31, 2022, the Company had a balance of $ 1.1 million and $ 2.0 million of receivables from Regeneron in connection with this agreement in prepaid expenses and other current assets in the consolidated balance sheet, respectively.

Commitments and contingencies

The table below presents the lease-related assets and liabilities recorded on the consolidated balance sheet as of June 30, 2022:

Three Months Ended June 30,

The table below presents the lease-related assets and liabilities recorded on the consolidated balance sheet as of September 30, 2022:

Three Months Ended September 30, Six Months Ended September 30,

2022 2021 2022 2021

Finance lease costs:

3 unchanged sentences

Total lease cost $ 1,409 $ 1,409 $ 2,827 $ 2,816

The following table summarizes the classification of lease costs in the consolidated statement of operations for the three months ended June 30, 2022 and 2021 as follows:

Three Months Ended June 30,

The following table summarizes the classification of lease costs in the consolidated statement of operations for the three months ended September 30, 2022 and 2021 as follows:

Three Months Ended September 30, Six Months Ended September 30,

2022 2021 2022 2021

Finance Lease Costs

6 unchanged sentences

Total lease cost $ 1,409 $ 1,409 $ 2,827 $ 2,816

The following table summarizes the maturity of the Company's lease liabilities on an undiscounted cash flow basis and a reconciliation to the operating and financing lease liabilities recognized on its balance sheet as of June 30, 2022:

June 30, 2022

September 30, 2022

Operating leases Financing lease Total

2023 (remaining nine months) $ 777 $ 1,932 $ 2,709

2023 (remaining six months) $ 500 $ 1,297 $ 1,797

2024 1,007 2,639 3,646

6 unchanged sentences

Total lease liabilities $ 5,282 $ 26,806 $ 32,088

The following table provides lease disclosure as of June 30, 2022 and March 31, 2022:

June 30, 2022 March 31, 2022

The following table provides lease disclosure as of September 30, 2022 and March 31, 2022:

September 30, 2022 March 31, 2022

Right-to-use operating lease asset $ 4,984 $ 5,552

6 unchanged sentences

Total lease liabilities $ 32,088 $ 32,839

The following table provides lease disclosure for the three months ended June 30, 2022 and 2021:

Three Months Ended June 30,

The following table provides lease disclosure for the three months ended September 30, 2022 and 2021:

Six Months Ended September 30,

Other information

7 unchanged sentences

Weighted-average discount rate - financing leases 8.3 % 8.3 %

The variable lease costs and short-term lease costs were insignificant for three months ended June 30, 2022 and 2021.

The variable lease costs and short-term lease costs were insignificant for three and six months ended September 30, 2022 and 2021.

Manufacturing commitments

The Company has entered into an agreement with a contract manufacturing organization to provide clinical trial products.

As of June 30, 2022 and March 31, 2022, the Company had committed to minimum payments under these arrangements totaling $ 1,631 and $ 1,951 , respectively, through June 30, 2022.

As of September 30, 2022 and March 31, 2022, the Company had committed to minimum payments under these arrangements totaling $ 1,209 and $ 1,951 , respectively.

Indemnification agreements

3 unchanged sentences

To date, the Company has not incurred any material costs as a result of such indemnifications.

The Company is not aware of any claims under indemnification arrangements, and therefore it has not accrued any liabilities related to such obligations in its consolidated financial statements as of June 30, 2022 or March 31, 2022.

Legal proceedings

4 unchanged sentences

Information about the Company’s long-lived assets held in different geographic regions is presented in the tables below:

June 30, 2022 March 31, 2022

September 30, 2022 March 31, 2022

United States $ 6,188 $ 6,318

1 unchanged sentence

$ 7,910 $ 7,933

Subsequent Events

On October 6, 2022 (the “Closing Date”), the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with Hercules Capital, Inc.

(“Hercules”), in its capacity as administrative agent and collateral agent (the “Agent”) and as a lender, and certain other financial institutions that from time to time may become parties to the Loan Agreement as lenders (collectively, the “Lenders”).

The Loan Agreement provides for term loans in an aggregate principal amount of up to $ 200.0 million under multiple tranches (the “Term Loan Facility”), available to be drawn during the specified time period at the Company's option, which includes (i) an initial term loan advance of $ 30.0 million on the Closing Date with an additional $ 30.0 million available to be drawn on or prior to September 30, 2023, (ii) subject to the Company achieving certain performance milestones, additional term loan advances in an aggregate principal amount of up to $ 115.0 million during the term of the Term Loan Facility, and (iii) subject to approval by the applicable Lenders’ investment committees in their discretion, up to two term loan advances in an aggregate principal amount of up to $ 25.0 million, on or prior to the end of the interest-only period referred to below.

The Company has agreed to use the proceeds of the Term Loan Facility for working capital and general corporate purposes.

The Term Loan Facility will mature on October 1, 2027 (the “Maturity Date”).

The outstanding principal balance of the Term Loan Facility bears interest payable in cash at a floating rate per annum equal to the greater of (i) 7.25 % and (ii) the sum of the Prime Rate (which is capped at 7.25 %) and 1.75 %.

In addition, the principal balance of the Term Loan Facility will bear “payment-in-kind” interest at the rate of 1.50 % (“PIK Interest”), which PIK Interest will be added to the outstanding principal balance of the Term Loan Facility on each interest payment date.

Accrued interest is payable monthly following the funding of each term loan advance.

The Company may make payments of interest only, without any loan amortization payments, for a period of forty-eight ( 48 ) months following the Closing Date, which interest-only period may be extended to (i) the date which is fifty-four ( 54 ) months following the Closing Date if certain performance milestones have been achieved, and (ii) the Maturity Date if certain additional performance milestones have been achieved.

At the end of the interest-only period, the Company is required

to begin repayment of the outstanding principal of the Term Loan Facility in equal monthly installments (or, in a single installment, if the interest-only period has been extended to the Maturity Date).

The Loan Agreement contains customary facility fees, events of default and representations, warranties and affirmative and negative covenants, including a financial covenant requiring us to maintain certain levels of cash in accounts subject to a control agreement in favor of the Agent (the “Unrestricted Cash”) at all times commencing on January 1, 2024.

In addition, the Loan Agreement also contains a financial covenant that beginning on the later of (i) July 1, 2024 and (ii) the date on which the aggregate outstanding principal amount of the Term Loan Facility is equal to or greater than $ 100.0 million, the Company is required to satisfy one of the following requirements:

(1) achieve a minimum amount of trailing three-month net product revenue tested on a monthly basis, (2) maintain a market capitalization in excess of $ 1.2 billion and Unrestricted Cash in an amount no less than 50 % of the outstanding amount under the Term Loan Facility, or (3) maintain Unrestricted Cash in an amount no less than 85 % of the outstanding amount under the Term Loan Facility.

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