Aclaris Therapeutics, Inc 10-Q for FY2021 Q1

Aclaris Therapeutics, Inc. (ACRS)

10-Q 2021-05-07 For: 2021-03-31

Added on April 08, 2026

About this 10-Q

Aclaris Therapeutics, Inc filed this 10-Q on May 7, 2021, covering the quarter ended March 31, 2021 (FY2021 Q1).

Headline figures

Quarter ended March 31, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $1.78M; up 26.3% from $1.41M a year earlier
Net loss: $28.75M; compared with a net loss of $15.59M a year earlier

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(Mark one)
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2021
OR
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Delaware (State or Other Jurisdiction of Incorporation or Organization)	46-0571712 (I.R.S. Employer Identification No.)
640 Lee Road, Suite 200 Wayne, PA (Address of principal executive offices)	19087 (Zip Code)


Title of Each Class:	Trading Symbol(s)	Name of Each Exchange on which Registered
Common Stock, $0.00001 par value	ACRS	The Nasdaq Stock Market, LLC


Large accelerated filer ◻		Accelerated filer ◻

Non-accelerated filer ⌧		Smaller reporting company ☒

		Emerging growth company ☐


			PAGE

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements			2

Unaudited Condensed Consolidated Balance Sheets as of March 31, 2021 and December 31, 2020			2

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three months ended March 31, 2021 and 2020			3

Unaudited Condensed Consolidated Statements of Stockholders’ Equity for the three months ended March 31, 2021 and 2020			4

Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2021 and 2020			5

Notes to Unaudited Condensed Consolidated Financial Statements			6

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			20

Item 3. Quantitative and Qualitative Disclosures about Market Risk			34

Item 4. Controls and Procedures			34

PART II. OTHER INFORMATION

Item 1. Legal Proceedings			35

Item 1A. Risk Factors			36

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			36

Item 6. Exhibits			36

Signatures			38


	March 31,		December 31,
	2021		2020

Assets
Current assets:
Cash and cash equivalents	$	35,267	$	22,063
Short-term marketable securities		93,028		32,068
Accounts receivable, net		817		772
Prepaid expenses and other current assets		5,389		2,590
Total current assets		134,501		57,493
Marketable securities		14,362		—
Property and equipment, net		1,424		1,654
Intangible assets		7,105		7,123
Other assets		4,007		4,514
Total assets	$	161,399	$	70,784
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	7,292	$	5,254
Accrued expenses		3,599		5,906
Current portion of lease liabilities		625		603
Discontinued operations - current liabilities		2,989		3,111
Total current liabilities		14,505		14,874
Other liabilities		3,041		3,179
Long-term debt, net		10,692		10,653
Contingent consideration		20,500		4,061
Deferred tax liability		367		367
Total liabilities		49,105		33,134
Commitments and contingencies (Note 17)
Stockholders’ Equity:
Preferred stock, $0.00001 par value; 10,000,000 shares authorized and no shares issued or outstanding at March 31, 2021 and December 31, 2020		—		—
Common stock, $0.00001 par value; 100,000,000 shares authorized at March 31, 2021 and December 31, 2020; 52,081,729 and 45,109,314 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively		—		—
Additional paid‑in capital		645,730		542,286
Accumulated other comprehensive loss		(140)		(94)
Accumulated deficit		(533,296)		(504,542)
Total stockholders’ equity		112,294		37,650
Total liabilities and stockholders’ equity	$	161,399	$	70,784


	Three Months Ended
	March 31,
	2021		2020
Revenues:
Contract research	$	1,535	$	1,189
Other revenue		242		218
Total revenue		1,777		1,407

Costs and expenses:
Cost of revenue		1,202		1,269
Research and development		7,838		7,677
General and administrative		4,827		6,200
Revaluation of contingent consideration		16,439		1,767
Total costs and expenses		30,306		16,913
Loss from operations		(28,529)		(15,506)

Other income (expense), net		(225)		178
Loss from continuing operations		(28,754)		(15,328)
Loss from discontinued operations		—		(258)
Net loss	$	(28,754)	$	(15,586)

Net loss per share, basic and diluted	$	(0.57)	$	(0.37)
Weighted average common shares outstanding, basic and diluted		50,337,807		41,618,429

Other comprehensive income (loss):
Unrealized gain (loss) on marketable securities, net of tax of $0	$	(35)	$	60
Foreign currency translation adjustment		(11)		53
Total other comprehensive income (loss)		(46)		113
Comprehensive loss	$	(28,800)	$	(15,473)


						Accumulated
	Common Stock			Additional		Other				Total
		Par		Paid‑in		Comprehensive		Accumulated		Stockholders’
	Shares	Value		Capital		Loss		Deficit		Equity
Balance at December 31, 2020	45,109,314	$	—	$	542,286	$	(94)	$	(504,542)	$	37,650
Issuance of common stock in connection with exercise of stock options and warrants and vesting of restricted stock units	666,144		—		(2,579)		—		—		(2,579)
Issuance of common stock in connection with public offering, net of offering costs of $7,011	6,306,271		—		103,348		—		—		103,348
Unrealized loss on marketable securities	—		—		—		(35)		—		(35)
Foreign currency translation adjustment	—		—		—		(11)		—		(11)
Stock-based compensation expense	—		—		2,675		—		—		2,675
Net loss	—		—		—		—		(28,754)		(28,754)
Balance at March 31, 2021	52,081,729	$	—	$	645,730	$	(140)	$	(533,296)	$	112,294


	March 31, 2021
(In thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents	$	29,132	$	—	$	—	$	29,132
Marketable securities		—		107,390		—		107,390
Total assets	$	29,132	$	107,390	$	—	$	136,522


Liabilities:
Contingent consideration	$	—	$	—	$	20,500	$	20,500
Total liabilities	$	—	$	—	$	20,500	$	20,500


	December 31, 2020
(In thousands)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents	$	14,955	$	1,500	$	—	$	16,455
Marketable securities		—		32,068		—		32,068
Total assets	$	14,955	$	33,568	$	—	$	48,523


Liabilities:
Contingent consideration	$	—	$	—	$	4,061	$	4,061
Total liabilities	$	—	$	—	$	4,061	$	4,061


	March 31, 2021
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
(In thousands)	Cost		Gain		Loss		Value
Marketable securities:
Corporate debt securities	$	21,556	$	—	$	(31)	$	21,525
Commercial paper		54,045		—		—		54,045
Asset-backed debt securities		14,062		1		(6)		14,057
U.S. government agency debt securities		17,760		3		—		17,763
Total marketable securities	$	107,423	$	4	$	(37)	$	107,390


		Gross Cost				Accumulated Amortization
	Remaining		March 31,		December 31,		March 31,		December 31,
(In thousands, except years)	Life (years)	2021		2020		2021		2020
Other intangible assets	6.3	$	751	$	751	$	275	$	257
In-process research and development	na		6,629		6,629		—		—
Total intangible assets		$	7,380	$	7,380	$	275	$	257


		Year Ending
(In thousands)		December 31,
2021	$	56
2022		75
2023		75
2024		75
2025		75
Thereafter		120
Total	$	476


				Weighted
		Weighted		Average
		Average		Remaining	Aggregate
	Number	Exercise		Contractual	Intrinsic
(In thousands, except share and per share data and years)	of Shares	Price		Term	Value
				(in years)
Outstanding as of December 31, 2020	2,871,498	$	15.16	6.8	$	4,890
Granted	880,600		24.06
Exercised	(27,632)		15.06			224
Forfeited and cancelled	(10,000)		21.93
Outstanding as of March 31, 2021	3,714,466	$	17.25	7.3	$	31,732
Options vested and expected to vest as of March 31, 2021	3,714,466	$	17.25	7.3	$	31,732
Options exercisable as of March 31, 2021	2,083,539	$	17.56	5.9	$	18,085


		Weighted
		Average
		Grant Date		Aggregate
	Number	Fair Value		Intrinsic
(In thousands, except share and per share data)	of Shares	Per Share		Value
Outstanding as of December 31, 2020	2,244,157	$	3.83
Granted	565,600		24.06
Vested	(377,371)		5.94	$	8,892
Forfeited and cancelled	(20,775)		2.85
Outstanding as of March 31, 2021	2,411,611	$	8.25


		March 31,		December 31,
(In thousands)	2021		2020
Computer equipment	$	1,197	$	1,197
Lab equipment		1,340		1,340
Furniture and fixtures		617		617
Leasehold improvements		1,123		1,123
Property and equipment, gross		4,277		4,277
Accumulated depreciation		(2,853)		(2,623)
Property and equipment, net	$	1,424	$	1,654


	Three Months Ended
	March 31,
	2021		2020
Risk-free interest rate	0.90	%	0.97	%
Expected term (in years)	6.3		6.2
Expected volatility	76.60	%	85.28	%
Expected dividend yield	0	%	0	%


	Three Months Ended
	March 31,
(In thousands, except for share and per share data)	2021		2020
Numerator:
Net loss	$	(28,754)	$	(15,586)
Denominator:
Weighted average shares of common stock outstanding, basic and diluted		50,337,807		41,618,429
Net loss per share, basic and diluted	$	(0.57)	$	(0.37)


(In thousands)			Contract		Corporate		Total
Three Months Ended March 31, 2021	Therapeutics		Research		and Other		Company
Total revenue	$	242	$	3,200	$	(1,665)	$	1,777
Cost of revenue		—		2,769		(1,567)		1,202
Research and development		7,936		—		(98)		7,838
General and administrative		—		629		4,198		4,827
Revaluation of contingent consideration		16,439		—		—		16,439
Loss from operations	$	(24,133)	$	(198)	$	(4,198)	$	(28,529)


(In thousands)			Contract		Corporate		Total
Three Months Ended March 31, 2020	Therapeutics		Research		and Other		Company
Total revenue	$	218	$	3,407	$	(2,218)	$	1,407
Cost of revenue		—		3,386		(2,117)		1,269
Research and development		7,778		—		(101)		7,677
General and administrative		—		753		5,447		6,200
Revaluation of contingent consideration		1,767		—		—		1,767
Loss from operations	$	(9,327)	$	(732)	$	(5,447)	$	(15,506)
Loss from discontinued operations	$	(257)	$	—	$	(1)	$	(258)


	Three Months Ended March 31,
(In thousands)	2021		2020		Change
Revenues:
Contract research	$	1,535	$	1,189	$	346
Other revenue		242		218		24
Total revenue		1,777		1,407		370

Costs and expenses:
Cost of revenue		1,202		1,269		(67)
Research and development		7,838		7,677		161
General and administrative		4,827		6,200		(1,373)
Revaluation of contingent consideration		16,439		1,767		14,672
Total costs and expenses		30,306		16,913		13,393
Loss from operations		(28,529)		(15,506)		(13,023)

Other income (expense), net		(225)		178		(403)
Loss from continuing operations		(28,754)		(15,328)		(13,426)
Loss from discontinued operations		—		(258)		258
Net loss	$	(28,754)	$	(15,586)	$	(13,168)


Exhibit No.		Document

3.1		Amended and Restated Certificate of Incorporation of the Registrant (incorporated herein by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 001-37581), filed with the SEC on October 13, 2015).

3.2		Amended and Restated Bylaws of the Registrant (incorporated herein by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 001-37581), filed with the SEC on June 24, 2020).

31.1*		Certification of Principal Executive Officer under Section 302 of the Sarbanes-Oxley Act.

31.2*		Certification of Principal Financial Officer under Section 302 of the Sarbanes-Oxley Act.

32.1**		Certifications of Principal Executive Officer and Principal Financial Officer under Section 906 of the Sarbanes-Oxley Act.

101.INS		XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document


101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


*	Filed herewith.
**	These certifications are being furnished solely to accompany this quarterly report pursuant to 18 U.S.C. Section 1350, and are not being filed for purposes of Section 18 of the Exchange Act and are not to be incorporated by reference into any filing of the registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing.


	ACLARIS THERAPEUTICS, INC.

Date: May 7, 2021	By:	/s/ Neal Walker
		Neal Walker
		President and Chief Executive Officer
		(On behalf of the Registrant)


Date: May 7, 2021	By:	/s/ Frank Ruffo
		Frank Ruffo
		Chief Financial Officer
		(Principal Financial Officer)