Bicycle Therapeutics PLC 10-Q for FY2020 Q3

Bicycle Therapeutics PLC (BCYC)

10-Q 2020-11-05 For: 2020-09-30

Added on April 06, 2026

About this 10-Q

Bicycle Therapeutics PLC filed this 10-Q on November 5, 2020, covering the quarter ended September 30, 2020 (FY2020 Q3).

Headline figures

Quarter ended September 30, 2020, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $3.84M; up 525.7% from $614K a year earlier
Net loss: $10.14M; compared with a net loss of $9.48M a year earlier

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England and Wales		Not Applicable
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

B900, Babraham Research Campus Cambridge, United Kingdom		CB22 3AT
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Ordinary shares, nominal value £0.01 per share *	n/a	The Nasdaq Stock Market LLC
American Depositary Shares, each representing one ordinary share, nominal value £0.01 per share	BCYC	The Nasdaq Stock Market LLC


Large accelerated filer ◻	Accelerated filer ◻
Non-accelerated filer ⌧	Smaller reporting company ⌧
	Emerging growth company ⌧


		Page
PART I - FINANCIAL INFORMATION		1

Item 1.	Financial Statements (unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss	2
	Condensed Consolidated Statements of Convertible Preferred Shares and Shareholders’ Equity (Deficit)	3
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	37

Item 3.	Quantitative and Qualitative Disclosure About Market Risk	54

Item 4.	Controls and Procedures	55

PART II - OTHER INFORMATION		56

Item 1.	Legal Proceedings	56

Item 1A	Risk Factors	57

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	116

Item 3.	Defaults Upon Senior Securities	117

Item 4.	Mine Safety Disclosures	117

Item 5.	Other Information	117

Item 6.	Exhibits	117

SIGNATURES		119


	September 30,		December 31,
	2020		2019
Assets
Current assets:
Cash	$	149,842	$	92,117
Accounts receivable		2,828		201
Prepaid expenses and other current assets		5,518		4,884
Research and development incentives receivable		5,970		6,944
Total current assets		164,158		104,146
Property and equipment, net		2,039		2,292
Operating lease right-of-use assets		1,459		2,056
Other assets		2,403		1,700
Total assets	$	170,059	$	110,194
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable	$	2,056	$	1,949
Accrued expenses and other current liabilities		7,798		6,144
Deferred revenue, current portion		7,193		728
Total current liabilities		17,047		8,821
Long-term debt, net		14,427		—
Operating lease liabilities		645		1,251
Deferred revenue, net of current portion		26,082		4,929
Other long‑term liabilities		2,307		1,995
Total liabilities		60,508		16,996
Commitments and contingencies (Note 13)
Shareholders’ equity:
Ordinary shares, £0.01 nominal value; 31,995,653 shares authorized at September 30, 2020 and December 31, 2019; 20,935,853 and 17,993,701 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively		264		227
Additional paid-in capital		246,391		195,056
Accumulated other comprehensive loss		(2,977)		(1,535)
Accumulated deficit		(134,127)		(100,550)
Total shareholders’ equity		109,551		93,198
Total liabilities and shareholders’ equity	$	170,059	$	110,194


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2020		2019		2020		2019
Collaboration revenues	$	3,842	$	614	$	6,542	$	8,520
Operating expenses:
Research and development		7,363		6,078		23,091		18,891
General and administrative		7,154		4,789		18,351		11,164
Total operating expenses		14,517		10,867		41,442		30,055
Loss from operations		(10,675)		(10,253)		(34,900)		(21,535)
Other income (expense):
Interest and other income, net		72		440		655		594
Other expense, net		—		—		—		(5,377)
Total other income (expense), net		72		440		655		(4,783)
Net loss before income tax provision		(10,603)		(9,813)		(34,245)		(26,318)
Benefit from income taxes		(465)		(331)		(668)		(116)
Net loss	$	(10,138)	$	(9,482)	$	(33,577)	$	(26,202)
Net loss attributable to ordinary shareholders	$	(10,138)	$	(9,482)	$	(33,577)	$	(26,202)
Net loss per share attributable to ordinary shareholders, basic and diluted	$	(0.52)	$	(0.53)	$	(1.81)	$	(3.00)
Weighted average ordinary shares outstanding, basic and diluted		19,426,833		17,900,978		18,504,013		8,734,943

Comprehensives Loss:
Net loss	$	(10,138)	$	(9,482)	$	(33,577)	$	(26,202)
Other comprehensive income (loss):
Foreign currency translation adjustment		743		(424)		(1,442)		(856)
Total comprehensive loss	$	(9,395)	$	(9,906)	$	(35,019)	$	(27,058)


															Accumulated
	Series A			Series B1			Series B2								Other				Total
	Convertible			Convertible			Convertible						Additional		Comprehensive				Shareholders’
	Preferred Shares			Preferred Shares			Preferred Shares			Ordinary Shares			Paid‑in		Income		Accumulated		Equity
	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount		Capital		(Loss)		Deficit		(Deficit)
Balance at December 31, 2019	—	$	—	—	$	—	—	$	—	17,993,701	$	227	$	195,056	$	(1,535)	$	(100,550)	$	93,198
Issuance of ordinary shares upon exercise of share options	—		—	—		—	—		—	1,071		—		2		—		—		2
Issuance of ordinary shares upon exercise of warrants	—		—	—		—	—		—	21,435		—		—		—		—		—
Share-based compensation expense	—		—	—		—	—		—	—		—		2,121		—		—		2,121
Foreign currency translation adjustment	—		—	—		—	—		—	—		—		—		(2,184)		—		(2,184)
Net loss	—		—	—		—	—		—	—		—		—		—		(11,324)		(11,324)
Balance at March 31, 2020	—		—	—		—	—		—	18,016,207		227		197,179		(3,719)		(111,874)		81,813
Issuance of ordinary shares upon exercise of share options	—		—	—		—	—		—	4,000		—		9		—		—		9
Issuance of ordinary shares upon exercise of warrants	—		—	—		—	—		—	71,450		1		—		—		—		1
Share-based compensation expense	—		—	—		—	—		—	—		—		1,319		—		—		1,319
Foreign currency translation adjustment	—		—	—		—	—		—	—		—		—		(1)		—		(1)
Net loss	—		—	—		—	—		—	—		—		—		—		(12,115)		(12,115)
Balance at June 30, 2020	—		—	—		—	—		—	18,091,657		228		198,507		(3,720)		(123,989)		71,026
Issuance of ordinary shares upon exercise of share options	—		—	—		—	—		—	13,483		—		87		—		—		87
Issuance of ADSs, net of commissions and offering expenses of $1.8 million	—		—	—		—	—		—	2,830,713		36		46,287		—		—		46,323
Share-based compensation expense	—		—	—		—	—		—	—		—		1,510		—		—		1,510
Foreign currency translation adjustment	—		—	—		—	—		—	—		—		—		743		—		743
Net loss	—		—	—		—	—		—	—		—		—		—		(10,138)		(10,138)
Balance at September 30, 2020	—	$	—	—	$	—	—	$	—	20,935,853	$	264	$	246,391	$	(2,977)	$	(134,127)	$	109,551


	Nine Months Ended
	Ended
	September 30,
	2020		2019
Cash flows from operating activities:
Net loss	$	(33,577)	$	(26,202)
Adjustments to reconcile net loss to net cash used in operating activities:
Share-based compensation expense		4,950		2,000
Depreciation and amortization		944		686
Change in fair value of warrant liability		—		5,381
Changes in operating assets and liabilities:
Accounts receivable		(2,685)		5,064
Research and development incentives receivable		937		(4,813)
Prepaid expenses and other current assets		(773)		(1,638)
Operating lease right‑of‑use assets		570		528
Other assets		(719)		(216)
Accounts payable		193		516
Accrued expenses and other current liabilities		1,030		(611)
Lease liabilities		(193)		(526)
Deferred revenue		27,782		(4,502)
Other long-term liabilities		369		639
Net cash used in operating activities		(1,172)		(23,694)
Cash used in investing activities:
Purchases of property and equipment		(716)		(1,164)
Net cash used in investing activities		(716)		(1,164)
Cash flows from financing activities:
Proceeds from issuance of series B2 convertible preferred shares, net of issuance costs		—		1,334
Proceeds from the issuance of ADSs, net of issuance costs		46,373		56,957
Proceeds from the exercise of share options and sale of ordinary shares		98		21
Proceeds from the exercise of warrants		1		6
Proceeds from issuance of debt		15,000		—
Payments of debt issuance costs		(373)		—
Net cash provided by financing activities		61,099		58,318
Effect of exchange rate changes on cash		(1,486)		(886)
Net increase in cash		57,725		32,574
Cash at beginning of period		92,117		63,380
Cash at end of period	$	149,842	$	95,954
Supplemental disclosure of cash flow information
Cash paid for income taxes	$	124	$	73
Public offering costs accrued but not paid	$	50	$	—
Cash paid for amounts included in the measurement of operating lease liabilities	$	823	$	447
Purchases of property and equipment included in accounts payable and accrued expenses	$	40	$	—
Debt issuance costs accrued but not paid	$	200	$	—
Conversion of convertible preferred shares to ordinary shares upon closing of the initial public offering	$	—	$	123,780
Reclassification of warrant liability to additional paid-in capital	$	—	$	10,021


	September 30,
	2020
Term loan payable	$	15,000
Unamortized debt issuance costs		(573)
Carrying value of term loan	$	14,427


	September 30,
	2020
2020	$	—
2021		—
2022		1,148
2023		7,262
2024		7,340
Total	$	15,750


				Weighted
		Weighted		Average	Aggregate
	Number of	Average		Contractual	Intrinsic
	Shares	Exercise Price		Term	Value
				(in years)	(in thousands)
Outstanding as of December 31, 2019	2,634,346	$	9.57	9.04	$	6,107
Granted	1,319,484		11.69	—		—
Exercised	(18,554)		5.33	—		—
Forfeited	(155,491)		10.69	—		—
Outstanding as of September 30, 2020	3,779,785	$	10.24	8.76	$	33,340
Vested and expected to vest as of September 30, 2020	3,779,785	$	10.24	8.76	$	33,340
Options exercisable as of September 30, 2020	1,377,257	$	8.39	8.08	$	15,580


	Three				Nine
	Months				Months
	Ended				Ended
	September 30,				September 30,
	2020		2019		2020		2019
Risk-free interest rate	0.3	%	1.7	%	1.4	%	2.2	%
Expected volatility	74.1	%	77.0	%	74.1	%	78.3	%
Expected dividend yield	—		—		—		—
Expected term (in years)	6.1		6.0		6.0		5.9


	Three Months				Nine Months
	Ended				Ended
	September 30,				September 30,
	2020		2019		2020		2019
Collaboration revenues
AstraZeneca	$	213	$	441	$	944	$	1,229
Sanofi		—		—		—		6,016
Oxurion		2,362		—		2,362		—
Dementia Discovery Fund		58		173		170		275
Material transfer agreement		—		—		—		1,000
Genentech		1,209		—		3,066		—
Total collaboration revenues	$	3,842	$	614	$	6,542	$	8,520


	Allocation of
Performance Obligations	Transaction Price
Target Three Research License and Related Services	$	650
Target 3 Material Right		1,504
Target 4 Material Right		1,204
Target 5 Material Right		1,165
Target 6 Material Right		1,127
	$	5,650


	Beginning Balance						Impact of		Ending Balance
	January 1,						Exchange		September 30,
	2020		Additions		Deductions		Rates		2020
Contract assets	$	—	$	—	$	—	$	—	$	—
Contract liabilities:
Deferred revenue
AstraZeneca collaboration deferred revenue		4,913		433		(118)		(138)		5,090
DDF collaboration deferred revenue		744		—		(178)		(16)		550
Genentech collaboration deferred revenue		—		31,000		(3,200)		(165)		27,635
Total deferred revenue	$	5,657	$	31,433	$	(3,496)	$	(319)	$	33,275


	September 30,		December 31,
	2020		2019
Laboratory equipment	$	4,790	$	4,326
Leasehold improvements		371		300
Computer equipment and software		185		229
Furniture and office equipment		189		120
		5,535		4,975
Less: Accumulated depreciation and amortization		(3,496)		(2,683)
	$	2,039	$	2,292


Year Ending December 31,
2020	$	226
2021		766
2022		444
2023		—
Present value adjustment		(107)
Total lease liabilities	$	1,329
Less: current lease liabilities		(684)
Long term lease liabilities	$	645


	Three Months Ended September 30,
	2020		2019		Change

	(in thousands)
Collaboration revenues	$	3,842	$	614	$	3,228
Operating expenses:
Research and development		7,363		6,078		1,285
General and administrative		7,154		4,789		2,365
Total operating expenses		14,517		10,867		3,650
Loss from operations		(10,675)		(10,253)		(422)
Other income (expense):
Interest and other income, net		72		440		(368)
Total other income (expense), net		72		440		(368)
Net loss before income tax provision		(10,603)		(9,813)		(790)
Benefit from income taxes		(465)		(331)		(134)
Net loss	$	(10,138)	$	(9,482)	$	(656)


	Nine Months Ended September 30,
	2020		2019		Change

	(in thousands)
Collaboration revenues	$	6,542	$	8,520	$	(1,978)
Operating expenses:
Research and development		23,091		18,891		4,200
General and administrative		18,351		11,164		7,187
Total operating expenses		41,442		30,055		11,387
Loss from operations		(34,900)		(21,535)		(13,365)
Other income (expense):
Interest and other income, net		655		594		61
Other expense, net		—		(5,377)		5,377
Total other expense, net		655		(4,783)		5,438
Net loss before income tax provision		(34,245)		(26,318)		(7,927)
Benefit from income taxes		(668)		(116)		(552)
Net loss	$	(33,577)	$	(26,202)	$	(7,375)


	Payments due by period
			Less than						More than
	Total		1 year		1 to 3 years		3 to 5 years		5 years

	(in thousands)
Operating lease commitments (1)	$	1,436	$	875	$	561	$	—	$	—
Debt obligations (2)		19,891		1,239		17,194		1,458		—
Total	$	21,327	$	2,114	$	17,755	$	1,458	$	—


Exhibit Number		Description

3.1		Articles of Association (incorporated by reference to Exhibit 3.2 to Amendment No. 1 to the Registration Statement on Form S-1 (File No. 333-231076), filed with the Securities and Exchange Commission on May 13, 2019).

4.1		Letter Agreement, dated July 1, 2020, by and between Bicycle Therapeutics plc and Citibank, N.A.

10.1		Loan and Security Agreement, dated September 30, 2020, by and among Bicycle Therapeutics plc, BicycleTx Limited and BicycleRD Limited, the lenders party thereto, and Hercules Capital, Inc., as administrative and collateral agent (incorporated by reference to Exhibit 10.1 to Form 8-K (File No. 001-38916), filed with the Securities and Exchange Commission on October 1, 2020).

31.1*		Certification of Principal 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 Principal 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 Principal Executive Officer and Principal 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


Exhibit Number		Description
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


	BICYCLE THERAPEUTICS PLC

Date: November 5, 2020	By:	/s/ Kevin Lee
		Kevin Lee, Ph.D., MBA
		Chief Executive Officer

		(Principal Executive Officer)

Date: November 5, 2020	By:	/s/ Lee Kalowski
		Lee Kalowski, MBA
		Chief Financial Officer and President

		(Principal Financial and Accounting Officer)

Number of Shares deposited in connection with Program Sale(s):	____________ Shares
Number of Program ADSs (CUSIP No.: 088786108; each Program ADS representing one (1) Share) to be issued in connection with Program Sale(s):	____________ Program ADSs

Name of DTC Participant to which the Program ADSs are to be delivered:
DTC Participant Account No.:	_____________________________
Account No. for recipient of Program ADSs at DTC Participant (f/b/o information):	_____________________________
Name on whose behalf the above number of Program ADSs are to be issued and delivered:	_____________________________
Contact person at DTC Participant:	_____________________________
Daytime telephone number of contact person at DTC Participant:	_____________________________