Bicycle Therapeutics PLC 10-Q for FY2022 Q3

Bicycle Therapeutics PLC (BCYC)

10-Q 2022-11-03 For: 2022-09-30

Added on April 06, 2026

About this 10-Q

Bicycle Therapeutics PLC filed this 10-Q on November 3, 2022, covering the quarter ended September 30, 2022 (FY2022 Q3).

Headline figures

Quarter ended September 30, 2022, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $3.04M; down 29.8% from $4.33M a year earlier
Net loss: $28.35M; compared with a net loss of $14.68M a year earlier
Diluted EPS: -$0.96; compared with -$0.59 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.)

Blocks A & B, Portway Building, Granta Park Great Abington, Cambridge, United Kingdom		CB21 6GS
(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 Shareholders’ Equity	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	32

Item 3.	Quantitative and Qualitative Disclosure About Market Risk	48

Item 4.	Controls and Procedures	49

PART II - OTHER INFORMATION		50

Item 1.	Legal Proceedings	50

Item 1A.	Risk Factors	51

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	109

Item 3.	Defaults Upon Senior Securities	109

Item 4.	Mine Safety Disclosures	109

Item 5.	Other Information	109

Item 6.	Exhibits	109

SIGNATURES


	September 30,		December 31,
	2022		2021
Assets
Current assets:
Cash and cash equivalents	$	361,469	$	438,680
Accounts receivable		—		1,000
Prepaid expenses and other current assets		8,448		7,965
Research and development incentives receivable		11,368		10,910
Total current assets		381,285		458,555
Property and equipment, net		16,220		3,123
Operating lease right-of-use assets		13,484		14,666
Other assets		6,159		3,448
Total assets	$	417,148	$	479,792
Liabilities and shareholders’ equity
Current liabilities:
Accounts payable	$	7,057	$	2,721
Accrued expenses and other current liabilities		18,091		14,244
Deferred revenue, current portion		16,404		19,273
Total current liabilities		41,552		36,238
Long-term debt, net of discount		30,232		29,873
Operating lease liabilities, net of current portion		10,997		12,081
Deferred revenue, net of current portion		41,736		52,067
Other long‑term liabilities		3,157		3,279
Total liabilities		127,674		133,538
Commitments and contingencies (Note 11)
Shareholders’ equity:
Ordinary shares, £0.01 nominal value; 57,820,181 and 55,295,420 shares authorized at September 30, 2022 and December 31, 2021, respectively; 29,678,431 and 29,579,364 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively		385		384
Additional paid-in capital		589,679		567,637
Accumulated other comprehensive loss		528		(3,388)
Accumulated deficit		(301,118)		(218,379)
Total shareholders’ equity		289,474		346,254
Total liabilities and shareholders’ equity	$	417,148	$	479,792


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Collaboration revenues	$	3,040	$	4,333	$	11,278	$	7,926
Operating expenses:
Research and development		22,752		10,513		56,890		31,924
General and administrative		10,047		8,114		38,830		23,596
Total operating expenses		32,799		18,627		95,720		55,520
Loss from operations		(29,759)		(14,294)		(84,442)		(47,594)
Other income (expense):
Interest income		1,991		24		3,117		61
Interest expense		(817)		(823)		(2,518)		(2,164)
Total other income (expense), net		1,174		(799)		599		(2,103)
Net loss before income tax provision		(28,585)		(15,093)		(83,843)		(49,697)
Benefit from income taxes		(238)		(415)		(1,104)		(915)
Net loss	$	(28,347)	$	(14,678)	$	(82,739)	$	(48,782)
Net loss per share, basic and diluted	$	(0.96)	$	(0.59)	$	(2.79)	$	(2.06)
Weighted average ordinary shares outstanding, basic and diluted		29,676,021		25,039,990		29,643,502		23,719,124

Comprehensives loss:
Net loss	$	(28,347)	$	(14,678)	$	(82,739)	$	(48,782)
Other comprehensive income (loss):
Foreign currency translation adjustment		902		313		3,916		—
Total comprehensive loss	$	(27,445)	$	(14,365)	$	(78,823)	$	(48,782)


						Accumulated
				Additional		Other				Total
	Ordinary Shares			Paid‑in		Comprehensive		Accumulated		Shareholders’
	Shares	Amount		Capital		Income (Loss)		Deficit		Equity
Balance at December 31, 2021	29,579,364	$	384	$	567,637	$	(3,388)	$	(218,379)	$	346,254
Issuance of ADSs upon exercise of share options	30,074		1		449		—		—		450
Issuance of ADSs upon vesting of restricted share units	35,000		—		—		—		—		—
Share-based compensation expense	—		—		10,198		—		—		10,198
Foreign currency translation adjustment	—		—		—		920		—		920
Net loss	—		—		—		—		(27,564)		(27,564)
Balance at March 31, 2022	29,644,438		385		578,284		(2,468)		(245,943)		330,258
Issuance of ADSs upon exercise of share options	21,879		—		195		—		—		195
Share-based compensation expense	—		—		5,673		—		—		5,673
Foreign currency translation adjustment	—		—		—		2,094		—		2,094
Net loss	—		—		—		—		(26,828)		(26,828)
Balance at June 30, 2022	29,666,317		385		584,152		(374)		(272,771)		311,392
Issuance of ADSs upon exercise of share options	12,114		—		159		—		—		159
Share-based compensation expense	—		—		5,368		—		—		5,368
Foreign currency translation adjustment	—		—		—		902		—		902
Net loss	—		—		—		—		(28,347)		(28,347)
Balance at September 30, 2022	29,678,431	$	385	$	589,679	$	528	$	(301,118)	$	289,474


	Nine Months
	Ended
	September 30,
	2022		2021
Cash flows from operating activities:
Net loss	$	(82,739)	$	(48,782)
Adjustments to reconcile net loss to net cash used in operating activities:
Share-based compensation expense		21,239		9,084
Depreciation and amortization		2,303		1,002
Non-cash interest		359		347
Changes in operating assets and liabilities:
Accounts receivable		348		5,544
Research and development incentives receivable		(3,064)		1,318
Prepaid expenses and other current assets		(2,137)		(719)
Operating lease right‑of‑use assets		2,015		(2,024)
Other assets		(2,640)		(955)
Accounts payable		4,931		270
Accrued expenses and other current liabilities		5,495		(521)
Operating lease liabilities		(1,446)		2,123
Deferred revenue		(969)		28,473
Other long-term liabilities		503		481
Net cash used in operating activities		(55,802)		(4,359)
Cash used in investing activities:
Purchases of property and equipment		(17,539)		(963)
Net cash used in investing activities		(17,539)		(963)
Cash flows from financing activities:
Proceeds from the issuance of ADSs, net of issuance costs		—		102,595
Issuance of ordinary shares pursuant to the Ionis share purchase agreement		—		7,558
Proceeds from the exercise of share options and sale of ordinary shares		804		4,908
Proceeds from issuance of debt		—		15,000
Net cash provided by financing activities		804		130,061
Effect of exchange rate changes on cash and cash equivalents		(4,674)		(1,205)
Net (decrease) increase in cash and cash equivalents		(77,211)		123,534
Cash and cash equivalents at beginning of period		438,680		135,990
Cash and cash equivalents at end of period	$	361,469	$	259,524
Supplemental disclosure of cash flow information
Cash paid for interest	$	2,099	$	1,753
Cash paid for income taxes	$	1,203	$	87
Cash paid for amounts included in the measurement of operating lease liabilities	$	2,245	$	676
Purchases of property and equipment included in accounts payable and accrued expenses	$	318	$	298
Non-cash impact right-of-use asset and operating lease liabilities	$	3,120	$	—



Year Ending December 31,
2022	$	—
2023		—
2024		—
2025		31,500
Total	$	31,500


	Number of			Weighted
	Shares	Weighted		Average	Aggregate
	Underlying	Average		Contractual	Intrinsic
	Share Options	Exercise Price		Term	Value
				(in years)	(in thousands)
Outstanding as of December 31, 2021	4,603,486	$	14.97	8.13	$	207,009
Granted	1,398,517		46.83	—		—
Exercised	(64,067)		12.55	—		—
Forfeited	(153,355)		25.86	—		—
Outstanding as of September 30, 2022	5,784,581	$	22.41	7.82	$	43,632
Vested and expected to vest as of September 30, 2022	5,784,581	$	22.41	7.82	$	43,632
Options exercisable as of September 30, 2022	3,177,177	$	13.51	7.06	$	35,164


	Number of Shares	Weighted-Average
	Underlying RSUs	Grant Date Fair Value
Unvested at December 31, 2021	—	$	—
Granted	222,725		60.86
Vested	(35,000)		60.86
Unvested at September 30, 2022	187,725	$	60.86


	Three Months				Nine Months
	Ended				Ended
	September 30,				September 30,
	2022		2021		2022		2021
Collaboration revenues
Ionis	$	2,195	$	2,066	$	6,764	$	2,066
Genentech		798		1,063		3,144		4,142
Dementia Discovery Fund		47		77		205		314
AstraZeneca		—		1,127		1,165		1,404
Total collaboration revenues	$	3,040	$	4,333	$	11,278	$	7,926


	Allocation of
Performance Obligations	Transaction Price
Combined licenses and research and discovery performance obligation	$	34,100
Four material rights associated with credits for IND Acceptance fees		3,900
	$	38,000


	Beginning Balance						Impact of		Ending Balance
	January 1,						Exchange		September 30,
	2022		Additions		Deductions		Rates		2022
Contract liabilities:
Deferred revenue
Ionis collaboration deferred revenue	$	34,115	$	—	$	(6,764)	$	(5,190)	$	22,161
Genentech collaboration deferred revenue		34,436		10,000		(3,144)		(6,475)		34,817
DDF collaboration deferred revenue		428		—		(205)		(53)		170
AstraZeneca collaboration deferred revenue		2,361		—		(1,165)		(204)		992
Total deferred revenue	$	71,340	$	10,000	$	(11,278)	$	(11,922)	$	58,140


	Three Months Ended September 30,
	2022		2021		Change

	(in thousands)
BT5528 (EphA2)	$	3,460	$	1,320	$	2,140
BT8009 (Nectin‑4)		2,757		2,355		402
BT1718 (MT1)		142		171		(29)
Bicycle tumor-targeted immune cell agonists		3,790		968		2,822
Other discovery and platform related expense		6,504		3,797		2,707
Employee and contractor related expenses		8,275		4,085		4,190
Share-based compensation		2,637		1,238		1,399
Facility expenses		1,339		389		950
Research and development incentives		(6,152)		(3,810)		(2,342)
Total research and development expenses	$	22,752	$	10,513	$	12,239


	September 30,		December 31,
	2022		2021
Laboratory equipment	$	11,385	$	6,746
Leasehold improvements		9,630		809
Computer equipment and software		403		143
Furniture and office equipment		822		225
		22,240		7,923
Less: Accumulated depreciation and amortization		(6,020)		(4,800)
	$	16,220	$	3,123


	September 30,		December 31,
	2022		2021
Term loan payable	$	30,000	$	30,000
End of term charge		624		376
Unamortized debt issuance costs		(392)		(503)
Carrying value of term loan	$	30,232	$	29,873


	Nine Months Ended September 30,
	2022		2021		Change

	(in thousands)
Collaboration revenues	$	11,278	$	7,926	$	3,352
Operating expenses:
Research and development		56,890		31,924		24,966
General and administrative		38,830		23,596		15,234
Total operating expenses		95,720		55,520		40,200
Loss from operations		(84,442)		(47,594)		(36,848)
Other income (expense):
Interest income		3,117		61		3,056
Interest expense		(2,518)		(2,164)		(354)
Total other income (expense), net		599		(2,103)		2,702
Net loss before income tax provision		(83,843)		(49,697)		(34,146)
Benefit from income taxes		(1,104)		(915)		(189)
Net loss	$	(82,739)	$	(48,782)	$	(33,957)


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

	(in thousands)
Operating lease commitments (1)	$	15,955	$	3,657	$	7,491	$	4,602	$	205
Debt obligations (2)		38,731		2,526		36,205		—		—
Total	$	54,686	$	6,183	$	43,696	$	4,602	$	205


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).

10.1*†		Amendment No. 2 to Collaboration and License Agreement, dated August 1, 2022, between BicycleTx Limited and Ionis Pharmaceuticals, Inc.

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 – 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


Exhibit Number		Description

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 – the cover page XBRL tags are embedded within the Inline XBRL document (included in Exhibit 101)


	BICYCLE THERAPEUTICS PLC

Date: November 3, 2022	By:	/s/ Kevin Lee
		Kevin Lee, Ph.D., MBA
		Chief Executive Officer

		(Principal Executive Officer)

Date: November 3, 2022	By:	/s/ Lee Kalowski
		Lee Kalowski, MBA
		Chief Financial Officer and President

		(Principal Financial and Accounting Officer)


THIS AMENDMENT NO. 2 TO COLLABORATION AND LICENSE AGREEMENT is executed by the authorized representatives of the Parties as of the Second Amendment Effective Date.
BICYCLETX LIMITED	IONIS PHARMACEUTICALS, INC.
By_: /s/ Michael Skynner Name: Michael Skynner Title: Chief Technology Officer	By_: /s/ Brett Monia Name: Brett Monia Title: CEO


Date: November 3, 2022	By:	/s/ Kevin Lee
		Kevin Lee, Ph.D., MBA
		Chief Executive Officer


Date: November 3, 2022	By:	/s/ Lee Kalowski
		Lee Kalowski, MBA
		Chief Financial Officer and President