Absci Corp 10-Q for FY2022 Q1

Absci Corp (ABSI)

10-Q 2022-05-11 For: 2022-03-31

Added on April 11, 2026

About this 10-Q

Absci Corp filed this 10-Q on May 11, 2022, covering the quarter ended March 31, 2022 (FY2022 Q1).

Headline figures

Quarter ended March 31, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $819K; down 23.0% from $1.06M a year earlier
Net loss: $29.49M; compared with a net loss of $10.96M a year earlier
Diluted EPS: -$0.33; compared with -$0.70 a year earlier

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Delaware						85-3383487
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

18105 SE Mill Plain Blvd Vancouver, WA						98683
(Address of Principal Executive Offices)						(Zip Code)


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒


		Page No.
Part I Financial Information (Unaudited)		6
Item 1.	Condensed Consolidated Financial Statements	6
	Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021	6
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three Months Ended March 31, 2022 and 2021	7
	Condensed Consolidated Statements of Changes in Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) for the Three Months Ended March 31, 2022 and 2021	8
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2022 and 2021	9
	Notes to Unaudited Condensed Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosure About Market Risk	36
Item 4.	Controls and Procedures	36

Part II Other Information		37
Item 1.	Legal Proceedings	37
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults Upon Senior Securities	38
Item 4.	Mine Safety Disclosures	38
Item 5.	Other Information	38
Item 6.	Exhibits	38
Signatures		40



	March 31,		December 31,
(In thousands, except for share and per share data)	2022		2021
ASSETS
Current assets:
Cash and cash equivalents	$	226,004	$	252,569
Restricted cash	23,014		10,513
Receivables under development arrangements	350		1,425
Prepaid expenses and other current assets	6,593		8,572
Total current assets	255,961		273,079
Operating lease right-of-use assets	6,266		6,538
Property and equipment, net	54,611		52,114
Intangibles, net	54,150		54,992
Goodwill	21,335		21,335
Restricted cash, long-term	1,844		16,844
Other long-term assets	1,293		1,293
TOTAL ASSETS	$	395,460	$	426,195
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable	$	6,739	$	8,385
Accrued expenses	25,641		17,434
Long-term debt, current	2,400		2,400
Operating lease obligations	1,545		1,502
Financing lease obligations	2,766		2,785
Deferred revenue	2,791		1,353
Total current liabilities	41,882		33,859
Long-term debt - net of current portion	531		1,124
Operating lease obligations - net of current portion	8,568		8,969
Finance lease obligations - net of current portion	2,402		3,231
Deferred tax, net	1,359		743

Other long-term liabilities	222		12,162
TOTAL LIABILITIES	54,964		60,088
Commitments (See Note 7)
STOCKHOLDERS' EQUITY
Preferred stock, $0.0001 par value; 10,000,000 shares authorized as of March 31, 2022 and December 31, 2021; 0 shares issued and outstanding as of March 31, 2022 and December 31, 2021	—		—
Common stock, $0.0001 par value; 500,000,000 shares authorized as of March 31, 2022 and December 31, 2021; 92,835,187 and 92,648,036 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively	9		9
Additional paid-in capital	561,029		557,136
Accumulated deficit	(220,519)		(191,025)
Accumulated other comprehensive loss	(23)		(13)
TOTAL STOCKHOLDERS' EQUITY	340,496		366,107
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	395,460	$	426,195



	For the Three Months Ended March 31,
(In thousands, except for share and per share data)	2022		2021
Revenues
Technology development revenue	$	454	$	940
Collaboration revenue	365		123
Total revenues	819		1,063
Operating expenses
Research and development	15,827		7,050
Selling, general and administrative	10,889		4,685
Depreciation and amortization	2,906		476
Total operating expenses	29,622		12,211
Operating loss	(28,803)		(11,148)
Other expense
Interest expense	(195)		(455)
Other income, net	125		164
Total other expense, net	(70)		(291)
Loss before income taxes	(28,873)		(11,439)
Income tax (expense) benefit	(621)		477
Net loss	(29,494)		(10,962)

Cumulative undeclared preferred stock dividends	—		(995)
Net loss applicable to common stockholders	$	(29,494)	$	(11,957)

Net loss per share attributable to common stockholders: Basic and diluted	$	(0.33)	$	(0.70)

Weighted-average common shares outstanding: Basic and diluted	90,272,205		16,980,074

Comprehensive loss:
Net loss	$	(29,494)	$	(10,962)
Foreign currency translation adjustments	(10)		—
Comprehensive loss	$	(29,504)	$	(10,962)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



(In thousands, except for share and per share data)	Redeemable Convertible Preferred Stock				Common Stock	Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss			Condensed Total Stockholders’ Equity
		Shares	Amount				Shares					Amount
Balances - December 31, 2021		—	$	—		92,648,036		$	9	$	557,136		$	(191,025)	$	(13)	$	366,107
Issuance of shares upon option exercise		—	—			187,151		—		213			—		—		213

Stock-based compensation		—	—			—		—		3,680			—		—		3,680
Foreign currency translation adjustments		—	—			—		—		—			—		(10)		(10)
Net loss		—	—			—		—		—			(29,494)		—		(29,494)
Balances - March 31, 2022		—	$	—		92,835,187		$	9	$	561,029		$	(220,519)	$	(23)	$	340,496



	For the Three Months Ended March 31,
(In thousands)	2022		2021
Cash Flows From Operating Activities
Net loss	(29,494)		(10,962)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	2,906		476
Deferred income taxes	616		(477)
Stock-based compensation	3,740		2,152

Change in fair value of contingent consideration	750		—
Gain on extinguishment of loan payable	—		(636)



Preferred stock warrant liability expense	—		475
Changes in operating assets and liabilities:
Receivables under development arrangements	1,074		615
Prepaid expenses and other current assets	1,801		(690)
Operating lease right-of-use assets and liabilities	(86)		255
Other long-term assets	—		32
Accounts payable	637		1,258
Accrued expenses and other liabilities	(4,531)		444
Deferred revenue	1,438		(227)
Net cash used in operating activities	(21,149)		(7,285)
Cash Flows From Investing Activities
Purchases of property and equipment	(6,857)		(6,364)
Acquisitions, net of cash acquired	—		(2,512)


Net cash used in investing activities	(6,857)		(8,876)
Cash Flows From Financing Activities
Proceeds from issuance of redeemable convertible preferred units and stock, net of issuance costs	—		4,944


Principal payments on long-term debt	(600)		—
Principal payments on finance lease obligations	(671)		(368)
Proceeds from issuance of common stock, net of issuance costs	213		—
Proceeds from issuance of convertible promissory notes	—		125,000
Net cash (used in) provided by financing activities	(1,058)		129,576
Net (decrease) increase in cash, cash equivalents, and restricted cash	(29,064)		113,415
Cash, cash equivalents and restricted cash - Beginning of year	279,926		71,708
Cash, cash equivalents, and restricted cash - End of period	$	250,862	$	185,123

Supplemental Disclosure of Cash Flow Information
Cash paid during the period for interest	$	155	$	154
Supplemental Disclosure of Non-Cash Investing and Financing Activities
Property and equipment purchased under finance lease	$	—	$	733
Right-of-use assets obtained in exchange for operating lease obligation	—		3,330
Cash paid for amounts included in the measurement of operating lease liabilities	565		109
Property and equipment purchases included in accounts payable	3,282		5,685
Deferred offering costs included in accounts payable	—		337



Cash consideration	$	2,670
Equity consideration	368
Total purchase consideration	$	3,038



Cash and cash equivalents	$	158
Accounts receivable	59
Other current assets	1
Intangible assets	2,507
Goodwill	1,055
TOTAL ASSETS	3,780
Accounts payable and accrued expenses	109
Deferred tax liability	633
TOTAL LIABILITIES	742
Fair value of net assets acquired and liabilities assumed	$	3,038



	Estimated Fair Value (in thousands)		Estimated Amortization Period (years)
Denovium Engine	$	2,507	5
	$	2,507



Estimated cash payment to Totient stockholders	$	35,368	(i)
Estimated stock payment to Totient stockholders	13,891		(ii)
Estimated cash payment contingent on achieving specified milestone	12,000		(iii)
Total	$	61,259



Current assets:
Cash and cash equivalents	$	1,751
Prepaid expenses and other current assets	189
Total current assets	1,940
Operating lease right-of-use assets	266
Property and equipment, net	118
Goodwill	20,280		(i)
Intangible assets	54,600		(ii)
Other long-term assets	23
TOTAL ASSETS	77,227
Current liabilities:
Accounts payable	78
Accrued expenses	6,588
Operating lease obligations	122
Total current liabilities	6,788
Operating lease obligations - net of current portion	144
Deferred tax, net	9,012
Other long-term liabilities	24
TOTAL LIABILITIES	15,968
Fair value of net assets acquired and liabilities assumed	$	61,259


	Estimated fair value (in thousands)(i)		Estimated useful lives (in years)(ii)
Monoclonal antibody library	$	46,300	20
Developed software platform and the related methods patents	8,300		15
Total	$	54,600



	March 31,		December 31,
	2022		2021
Construction in progress	$	304	$	933
Lab Equipment	32,138		27,776
Software	308		311
Furniture, Fixtures and Other	4,955		4,804
Leasehold Improvements	25,350		24,671
Total Cost	63,055		58,495
Less accumulated depreciation and amortization	(8,444)		(6,381)
Property and equipment, net	$	54,611	$	52,114


			Number of shares
Unvested as of December 31, 2021			2,585,670
Granted			—
Vested			(176,152)
Unvested as of March 31, 2022			2,409,518


	Number of Units	Weighted Average Strike Price
Unvested as of December 31, 2020	1,202,435	$	0.47
Granted	—	—
Vested	—	—
Exchange of Phantom Units for Cash Payment Rights, SARs, and/or Stock Options	(1,202,435)	$	0.47
Unvested as of March 31, 2021	—	$	—


	Number of Options	Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands $)
Outstanding at December 31, 2021	7,757,401	$	3.72	9.2	$	40,939
Granted	3,396,093	7.74
Exercised	(187,151)	1.14
Canceled/ Forfeited	(280,046)	6.78
Expired	(9,005)	1.12
Outstanding at March 31, 2022	10,677,292	4.97		9.1	42,496
Exercisable at March 31, 2022	1,889,711	$	1.16	8.5	$	13,746
Vested and expected to vest as of March 31, 2022	10,677,292			9.1	$	42,496



	March 31, 2022
	Level 1		Level 2		Level 3		Total
Assets:
Equity securities without RDFV	$	—	$	—	$	1,200	$	1,200
Total assets	$	—	$	—	$	1,200	$	1,200
Liabilities:



Contingent consideration	$	—	$	—	$	12,750	$	12,750
Total liabilities	$	—	$	—	$	12,750	$	12,750



	December 31, 2021
	Level 1		Level 2		Level 3		Total
Assets
Equity securities without RDFV	$	—	$	—	$	1,200	$	1,200
Total assets	$	—	$	—	$	1,200	$	1,200
Liabilities:
Contingent consideration	$	—	$	—	$	12,000	$	12,000
Total liabilities	$	—	$	—	$	12,000	$	12,000



	Contingent consideration		Total liabilities
Balance at December 31, 2021	$	12,000	$	12,000

Change in fair value during 2022	750		750

Balance at March 31, 2022	$	12,750	$	12,750



	Three Months Ended March 31,
		2022	2021
Redeemable convertible preferred stock outstanding		—	45,798,558
Redeemable convertible preferred stock warrants		—	307,211

Stock options		9,485,792	4,570,687
Restricted stock units		28,785	—
Unvested restricted stock		2,481,050	2,566,998


Exhibit No.						Description
3.1						Amended and Restated Certificate of Incorporation of Absci Corporation (filed as Exhibit 3.1 to the Form 8-K, File No. 001-40646, filed by Absci Corporation on July 26, 2021 and incorporated herein by reference).
3.2						Amended and Restated Bylaws of the Absci Corporation (filed as Exhibit 3.2 to the Form 8-K, File No. 001-40646, filed by Absci Corporation on July 26, 2021 and incorporated herein by reference).
4.2						Investors ’ Rights Agreement by and among the R egistrant and certain of its stockholders dated October 19, 2020 (fi led as Exhibit 4.2 to t he Form S-1, File N o. 333-257553, filed by Absci Corporation on June 30, 2021 and incorporated herein by reference).
4.3						Description of the Registrant ’s securities registered pursuant to S e ction 12 of the S ecurities and Exchange Act o f 1934, as amended (filed as Exhibit 4.3 to the Registrant ’s Annual Report on Form 10-K, File N o . 0 01-4 0646, f iled by Ab sci Corporation on March 22, 2022 and incorporated herein by reference ).
31.1*						Certification of Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*						Certification of Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1#						Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2#						Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


101.INS*						XBRL Instance Document
101.SCH*						XBRL Taxonomy Extension Schema Document
101.CAL*						XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*						XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*						XBRL Taxonomy Extension Label Linkbase Document
101.PRE*						XBRL Taxonomy Extension Presentation Linkbase Document
104*						Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)


	ABSCI CORPORATION

Date: May 11, 2022	By:	/s/ Gregory Schiffman
		Gregory Schiffman
		Chief Financial Officer (Principal Financial Officer)

Date: May 11, 2022	By:	/s/ Todd Bedrick
		Todd Bedrick
		Vice President, Corporate Controller (Principal Accounting Officer)


Date: May 11, 2022	By:	/s/ Sean McClain
		Sean McClain
		Founder and Chief Executive Officer