Relay Therapeutics, Inc 10-Q for FY2021 Q2

Relay Therapeutics, Inc. (RLAY)

10-Q 2021-08-12 For: 2021-06-30

Added on April 09, 2026

About this 10-Q

Relay Therapeutics, Inc filed this 10-Q on August 12, 2021, covering the quarter ended June 30, 2021 (FY2021 Q2).

Headline figures

Quarter ended June 30, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $844K
Net loss: $193.4M; compared with a net loss of $26.72M a year earlier

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Delaware		47-3923475
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☒	Smaller reporting company	☒

		Emerging growth company	☒

		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)		1
	Condensed Consolidated Balance Sheets as of June 30, 2021 and December 31, 2020		1
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and six months ended June 30, 2021 and 2020		2
	Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) for the three and six months ended June 30, 2021 and 2020		3
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2021 and 2020		4
	Notes to Condensed Consolidated Financial Statements		5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		14
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		23
Item 4.	Controls and Procedures		23
PART II.	OTHER INFORMATION		25
Item 1.	Legal Proceedings		25
Item 1A.	Risk Factors		25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		64
Item 5.	Other Information		64
Item 6.	Exhibits		65
Signatures			66

	June 30, 2021			December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	260,069		$	447,646
Investments		411,151			230,415
Accounts receivable		279			75,000
Contract asset		4,193			7,654
Prepaid expenses and other current assets		5,584			9,385
Total current assets		681,276			770,100
Property and equipment, net		6,559			6,250
Operating lease assets		21,688			22,579
Restricted cash		2,578			878
Intangible asset		2,300			—
Other assets		—			22
Total assets	$	714,401		$	799,829
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	7,871		$	6,351
Accrued expenses and other current liabilities		15,405			5,760
Operating lease liabilities		1,695			1,521
Deferred revenue		414			—
Total current liabilities		25,385			13,632
Operating lease liabilities, net of current portion		22,022			22,901
Restricted stock liability		—			3
Contingent consideration liability		48,465			—
Total liabilities		95,872			36,536
Commitments and contingencies (Note 10)
Stockholders’ equity:
Undesignated preferred stock, $0.001 par value, 10,000,000 shares authorized as of June 30, 2021 and December 31, 2020; no shares issued and outstanding at June 30, 2021 and December 31, 2020		—			—
Common stock, $0.001 par value; 150,000,000 shares authorized at June 30, 2021 and December 31, 2020; 92,552,645 and 89,991,324 shares issued at June 30, 2021 and December 31, 2020, respectively; 92,552,645 and 89,906,835 shares outstanding at June 30, 2021 and December 31, 2020, respectively		92			90
Additional paid-in capital		1,258,312			1,167,367
Accumulated other comprehensive income (loss)		(64	)		64
Accumulated deficit		(639,811	)		(404,228	)
Total stockholders’ equity		618,529			763,293
Total liabilities and stockholders’ equity	$	714,401		$	799,829

	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020
Revenue:
Collaboration revenue	$	844		$	—		$	1,796		$	—
Total revenue		844			—			1,796
Operating expenses:
Research and development expenses	$	45,147		$	21,666		$	75,769		$	43,363
In-process research and development expenses		123,000			—			123,000			—
Loss on initial consolidation of variable interest entity		11,855			—			11,855			—
General and administrative expenses		14,422			6,053			27,156			10,814
Total operating expenses		194,424			27,719			237,780			54,177
Loss from operations		(193,580	)		(27,719	)		(235,984	)		(54,177	)
Other income (expense):
Interest income		180			998			406			2,570
Other income (expense)		1			(3	)		(4	)		(3	)
Total other income (expense), net		181			995			402			2,567
Net loss	$	(193,399	)	$	(26,724	)	$	(235,582	)	$	(51,610	)
Net loss per share, basic and diluted	$	(2.10	)	$	(6.06	)	$	(2.58	)	$	(12.06	)
Weighted average shares of common stock, basic and diluted		91,939,439			4,408,470			91,188,160			4,281,169
Other comprehensive (loss) income:
Unrealized holding (loss) gain		(76	)		(763	)		(128	)		306
Total other comprehensive (loss) income		(76	)		(763	)		(128	)		306
Total comprehensive loss	$	(193,475	)	$	(27,487	)	$	(235,710	)	$	(51,304	)

	Convertible Preferred Stock				Common Stock				Additional Paid-in		Accumulated Other Comprehensive			Accumulated			Total Stockholders’ Equity
	Shares		Amount		Shares		Par value		Capital		Income			Deficit
Balances at December 31, 2020		—	$	—		89,906,835	$	90	$	1,167,367	$	64		$	(404,228	)	$	763,293
Issuance of common stock upon exercise of stock options		—		—		437,230		—		2,055		—			—			2,055
Vesting of restricted common stock		—		—		84,489		—		3		—			—			3
Stock-based compensation expense		—		—		—		—		9,671		—			—			9,671
Unrealized loss on investments		—		—		—		—		—		(52	)		—			(52	)
Net loss		—		—		—		—		—		—			(42,184	)		(42,184	)
Balances at March 31, 2021		—	$	—		90,428,554	$	90	$	1,179,096	$	12		$	(446,412	)	$	732,786
Issuance of common stock upon exercise of stock options		—		—		218,365		—		1,123		—			—		$	1,123
Vesting of restricted common stock		—		—		22,239		—		—		—			—			—
Stock-based compensation expense		—		—		—		—		16,147		—			—			16,147
Shares issued in connection with acquisition of ZebiAI		—		—		1,883,487		2		61,946		—			—			61,948
Unrealized loss on investments		—		—		—		—		—		(76	)		—			(76	)
Net loss		—		—		—		—		—		—			(193,399	)		(193,399	)
Balances at June 30, 2021		—	$	—		92,552,645	$	92	$	1,258,312	$	(64	)	$	(639,811	)	$	618,529

	June 30, 2021		June 30, 2020
Cash and cash equivalents	$	260,069	$	137,053
Restricted cash		2,578		878
Total cash, cash equivalents and restricted cash as shown on condensed consolidated statements of cash flows	$	262,647	$	137,931

	Fair Value Measurements as of June 30, 2021:
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents:
Money market funds	$	247,749	$	—	$	—	$	247,749
Investments:
US treasury bills		—		252,793		—		252,793
US agency securities		—		158,358		—		158,358
Total investments		—		411,151		—		411,151
Total assets	$	247,749	$	411,151	$	—	$	658,900
Liabilities
Contingent consideration		—		—		43,465		43,465
Total liabilities	$	—	$	—	$	43,465	$	43,465

	Fair Value Measurements as of December 31, 2020:
	Level 1		Level 2		Level 3		Total
Assets
Cash equivalents:
Money market funds	$	447,146	$	—	$	—	$	447,146
Investments:
US treasury bills		—		33,026		—		33,026
US agency securities		—		197,389		—		197,389
Total investments		—		230,415		—		230,415
Total	$	447,146	$	230,415	$	—	$	677,561

	June 30, 2021
	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
Investments:
U.S treasury bills	$	68,162	$	4	$	—		$	68,166
U.S agency securities		12,999		2					13,001
Total investments with a maturity of one year or less		81,161		6		—			81,167

U.S treasury bills		184,707		—		(80	)		184,627
U.S agency securities		145,347		10					145,357
Total investments with a maturity of one to two years		330,054		10		(80	)		329,984
Total investments	$	411,215	$	16	$	(80	)	$	411,151

	December 31, 2020
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Investments:
U.S treasury bills	$	29,997	$	21	$	—	$	30,018
U.S agency securities		20,996	5			—		21,001
Total investments with a maturity of one year or less		50,993		26		—		51,019

U.S treasury bills		3,008		—		—		3,008
U.S agency securities		176,350	38			—		176,388
Total investments with a maturity of one to two years		179,358		38		—		179,396
Total investments	$	230,351	$	64	$	—	$	230,415

Acquired IPR&D asset	$	123,000
Loss on initial consolidation of VIE		11,855
Assets obtained in asset acquisition		662
Liabilities assumed in asset acquisition		(2,330	)
Intangible asset		2,300
Net acquired assets	$	135,487

	Three Months Ended June 30, 2021		Six Months Ended June 30, 2021
	(in thousands)
External costs for programs in clinical trials	$	4,244	$	6,967
External costs for all programs in discovery and pre-clinical studies		17,023		29,829
External costs for platform research and other research and development activities		3,792		7,154
Employee related expenses		20,088		31,819
Total research and development expenses	$	45,147	$	75,769

	Three Months Ended June 30,						Change
	2021			2020
	(in thousands)
Revenue	$	844		$	—		$	844
Operating expenses:
Research and development	$	45,147		$	21,666		$	23,481
In-process research and development		123,000			—			123,000
Loss on initial consolidation of variable interest entity		11,855			—			11,855
General and administrative		14,422			6,053			8,369
Total operating expenses		194,424			27,719			166,705
Loss from operations		(193,580	)		(27,719	)		(165,861	)
Other income, net		181			995			(814	)
Net loss	$	(193,399	)	$	(26,724	)	$	(166,675	)

Exhibit Number		Description

2.1†		Agreement and Plan of Merger dated April 22, 2021 by and among Relay Therapeutics, Inc., Elixir Merger Sub I, Inc., Elixir Merger Sub II, LLC, ZebiAI Therapeutics, Inc., and Shareholder Representative Services LLC (incorporated by reference to Exhibit 2.1 to the Registrant’s Form 8-K (File No. 001-39385) filed on April 16, 2021).

3.1		Fourth Amended and Restated Certificate of Incorporation of Relay Therapeutics, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K (File No. 001-39385) filed on July 21, 2020).

3.2		Amended and Restated Bylaws of Relay Therapeutics, Inc. (incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K (File No. 001-39385) filed on July 21, 2020).

10.1#		Amended and Restated Non-Employee Director Compensation Policy, effective as of April 1, 2021 (incorporated by reference to Exhibit 10.5 to the Registrant’s Registration Statement on Form S-1 (File No. 333-255583) filed with the SEC on April 28, 2021).

10.2#*		Retention Agreement by and between the Registrant and Donald Bergstrom, dated May 10, 2021.


10.3		Amendment No. 2 to Amended and Restated Collaboration and License Agreement, by and between the Registrant and D. E. Shaw Research, LLC, dated May 12, 2021 (incorporated by reference to Exhibit 10.4 to the Registrant’s Form 10-Q (File No. 001-39385) filed on May 13, 2021).

10.4		Registration Rights Agreement by and between the Registrant and the stockholders of ZebiAI Therapeutics, Inc. dated April 22, 2021 (incorporated by reference to Exhibit 10.14 to the Registrant’s Registration Statement on Form S-1 (File No. 333-255583) filed with the SEC on April 28, 2021).

10.5*		Lease by and between the Registrant and BMR-Hampshire, LLC, dated May 26, 2021.

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*		Inline 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 with applicable taxonomy extension information contained in Exhibits 101.*)

	RELAY THERAPEUTICS, INC.

Date: August 12, 2021	By:	/S/ SANJIV K. PATEL
		Sanjiv K. Patel, M.D.
		President and Chief Executive Officer
		(Principal Executive Officer)

Date: August 12, 2021	By:	/S/ THOMAS CATINAZZO
		Thomas Catinazzo
		Senior Vice President, Finance
		(Principal Accounting Officer and Principal Financial Officer)