10-Q 1 cers-20230930.htm 10-Q 10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

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

For the quarterly period ended September 30, 2023

or

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

For the transition period from: to

Commission File Number 000-21937

 

CERUS CORPORATION

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

68-0262011

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

1220 Concord Avenue, Suite 600

Concord, California

 

94520

(Address of principal executive offices)

 

(Zip Code)

 

(925) 288-6000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class

Trading Symbol

Name of Each Exchange on Which Registered

Common Stock, par value $0.001 per share

CERS

The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YesNo

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YesNo

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

 

 

 

 

Non-accelerated filer

Smaller reporting company

 

 

 

 

 

 

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YesNo

As of October 19, 2023, there were 181,197,000 shares of the registrant’s common stock outstanding.

 

 

 


CERUS CORPORATION

FORM 10-Q

For the Quarterly Period Ended September 30, 2023

TABLE OF CONTENTS

 

PART I

FINANCIAL INFORMATION

 

 

 

Item 1.

Financial Statements

1

Condensed Consolidated Balance Sheets – September 30, 2023 and December 31, 2022

1

Condensed Consolidated Statements of Operations – Three and nine months ended September 30, 2023 and 2022

2

Condensed Consolidated Statements of Comprehensive Loss – Three and nine months ended September 30, 2023 and 2022

3

 

Condensed Consolidated Statements of Stockholders’ Equity – Three and nine months ended September 30, 2023 and 2022

4

Condensed Consolidated Statements of Cash Flows – Nine months ended September 30, 2023 and 2022

6

Notes to Condensed Consolidated Financial Statements

7

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

23

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

33

Item 4.

Controls and Procedures

33

 

 

 

PART II

 OTHER INFORMATION

 

 

 

 

Item 1.

Legal Proceedings

35

Item 1A.

Risk Factors

35

Item 2.

Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities

70

Item 3.

Defaults Upon Senior Securities

70

Item 4.

Mine Safety Disclosures

70

Item 5.

Other Information

70

Item 6.

Exhibits

71

 

 

SIGNATURES

72

 

 

 


 

PART I: FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CERUS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

 

 

September 30,

 

 

December 31,

 

 

 

2023

 

 

2022

 

 

 

(Unaudited)

 

 

 

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

17,389

 

 

$

35,585

 

Short-term investments

 

 

61,617

 

 

 

66,569

 

Accounts receivable

 

 

24,546

 

 

 

34,426

 

Current inventories

 

 

42,661

 

 

 

29,003

 

Prepaid and other current assets

 

 

4,723

 

 

 

4,561

 

Total current assets

 

 

150,936

 

 

 

170,144

 

Non-current assets:

 

 

 

 

 

 

Property and equipment, net

 

 

9,252

 

 

 

10,969

 

Operating lease right-of-use assets

 

 

11,029

 

 

 

12,512

 

Goodwill

 

 

1,316

 

 

 

1,316

 

Restricted cash

 

 

1,770

 

 

 

1,773

 

Non-current inventories

 

 

21,287

 

 

 

15,494

 

Other assets

 

 

10,254

 

 

 

5,884

 

Total assets

 

$

205,844

 

 

$

218,092

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

38,519

 

 

$

33,002

 

Accrued liabilities

 

 

19,620

 

 

 

25,203

 

Debt – current

 

 

18,779

 

 

 

56,159

 

Operating lease liabilities – current

 

 

2,268

 

 

 

2,105

 

Deferred product revenue

 

 

936

 

 

 

589

 

Total current liabilities

 

 

80,122

 

 

 

117,058

 

Non-current liabilities:

 

 

 

 

 

 

Debt – non-current

 

 

59,789

 

 

 

13,644

 

Operating lease liabilities – non-current

 

 

14,083

 

 

 

15,329

 

Other non-current liabilities

 

 

2,827

 

 

 

3,499

 

Total liabilities

 

 

156,821

 

 

 

149,530

 

Commitments and contingencies

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

Common stock

 

 

181

 

 

 

177

 

Additional paid-in capital

 

 

1,093,494

 

 

 

1,077,341

 

Accumulated other comprehensive loss

 

 

(2,225

)

 

 

(2,787

)

Accumulated deficit

 

 

(1,043,282

)

 

 

(1,007,121

)

Total Cerus Corporation stockholders' equity

 

 

48,168

 

 

 

67,610

 

Noncontrolling interest

 

 

855

 

 

 

952

 

Total liabilities and stockholders' equity

 

$

205,844

 

 

$

218,092

 

 

 

 

 

 

 

 

See accompanying Notes to Condensed Consolidated Financial Statements.

1


 

CERUS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

UNAUDITED

(in thousands, except per share data)

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

September 30,

 

 

September 30,

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Product revenue

$

39,772

 

 

$

39,571

 

 

$

109,599

 

 

$

118,014

 

Cost of product revenue

 

17,956

 

 

 

17,662

 

 

 

49,158

 

 

 

55,456

 

Gross profit on product revenue

 

21,816

 

 

 

21,909

 

 

 

60,441

 

 

 

62,558

 

Government contract revenue

 

7,479

 

 

 

6,772

 

 

 

23,856

 

 

 

18,980

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

16,783

 

 

 

16,220

 

 

 

53,351

 

 

 

45,493

 

Selling, general and administrative

 

16,155

 

 

 

19,908

 

 

 

58,247

 

 

 

60,175

 

Restructuring

 

1,600

 

 

 

 

 

 

3,728

 

 

 

 

Total operating expenses

 

34,538

 

 

 

36,128

 

 

 

115,326

 

 

 

105,668

 

Loss from operations

 

(5,243

)

 

 

(7,447

)

 

 

(31,029

)

 

 

(24,130

)

Non-operating expense, net:

 

 

 

 

 

 

 

 

 

 

 

Foreign exchange gain (loss)

 

166

 

 

 

234

 

 

 

22

 

 

 

(68

)

Interest expense

 

(2,364

)

 

 

(1,406

)

 

 

(6,157

)

 

 

(4,134

)

Other income (expense), net

 

233

 

 

 

165

 

 

 

1,159

 

 

 

(647

)

Total non-operating expense, net

 

(1,965

)

 

 

(1,007

)

 

 

(4,976

)

 

 

(4,849

)

Loss before income taxes

 

(7,208

)

 

 

(8,454

)

 

 

(36,005

)

 

 

(28,979

)

Provision for income taxes

 

78

 

 

 

67

 

 

 

253

 

 

 

221

 

Net loss

 

(7,286

)

 

 

(8,521

)

 

 

(36,258

)

 

 

(29,200

)

Net loss attributable to noncontrolling interest

 

(19

)

 

 

(39

)

 

 

(97

)

 

 

(45

)

Net loss attributable to Cerus Corporation

$

(7,267

)

 

$

(8,482

)

 

$

(36,161

)

 

$

(29,155

)

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share attributable to Cerus Corporation

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

$

(0.04

)

 

$

(0.05

)

 

$

(0.20

)

 

$

(0.17

)

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

180,938

 

 

 

177,236

 

 

 

179,950

 

 

 

176,231

 

 

 

 

 

 

 

 

 

 

 

 

See accompanying Notes to Condensed Consolidated Financial Statements.

2


 

CERUS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

UNAUDITED

(in thousands)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net loss

 

$

(7,286

)

 

$

(8,521

)

 

$

(36,258

)

 

$

(29,200

)

Other comprehensive (loss) income

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

(3

)

 

 

 

 

 

(101

)

 

 

 

Unrealized gains (losses) on available-for-sale investments, net of taxes

 

 

211

 

 

 

(1,036

)

 

 

663

 

 

 

(3,040

)

Comprehensive loss

 

 

(7,078

)

 

 

(9,557

)

 

 

(35,696

)

 

 

(32,240

)

Comprehensive loss attributable to noncontrolling interest

 

 

(19

)

 

 

(39

)

 

 

(97

)

 

 

(45

)

Total comprehensive loss attributable to Cerus Corporation

 

$

(7,059

)

 

$

(9,518

)

 

$

(35,599

)

 

$

(32,195

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See accompanying Notes to Condensed Consolidated Financial Statements.

 

3


 

CERUS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

UNAUDITED

(in thousands)

 

 

Cerus Corporation Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Additional
Paid-in

 

 

Accumulated
Other
Comprehensive

 

 

Accumulated

 

 

Noncontrolling

 

 

Total
Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Loss

 

 

Deficit

 

 

Interest

 

 

Equity

 

Balances as of December 31, 2022

 

 

177,582

 

 

$

177

 

 

$

1,077,341

 

 

$

(2,787

)

 

$

(1,007,121

)

 

$

952

 

 

$

68,562

 

Issuance of common stock from exercise of stock options,
   vesting of restricted stock units, and ESPP purchases

 

 

2,890

 

 

 

3

 

 

 

423

 

 

 

 

 

 

 

 

 

 

 

 

426

 

Stock-based compensation

 

 

 

 

 

 

 

 

5,669

 

 

 

 

 

 

 

 

 

 

 

 

5,669

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

546

 

 

 

 

 

 

 

 

 

546

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(15,619

)

 

 

(22

)

 

 

(15,641

)

Balances as of March 31, 2023

 

 

180,472

 

 

$

180

 

 

$

1,083,433

 

 

$

(2,241

)

 

$

(1,022,740

)

 

$

930

 

 

$

59,562

 

Issuance of common stock from vesting of restricted stock units

 

 

237

 

 

 

1

 

 

 

(70

)

 

 

 

 

 

 

 

 

 

 

 

(69

)

Stock-based compensation

 

 

 

 

 

 

 

 

5,720

 

 

 

 

 

 

 

 

 

 

 

 

5,720

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

(192

)

 

 

 

 

 

 

 

 

(192

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(13,275

)

 

 

(56

)

 

 

(13,331

)

Balances as of June 30, 2023

 

 

180,709

 

 

$

181

 

 

$

1,089,083

 

 

$

(2,433

)

 

$

(1,036,015

)

 

$

874

 

 

$

51,690

 

Issuance of common stock from exercise of stock options,
   vesting of restricted stock units, and ESPP purchases

 

 

457

 

 

 

 

 

 

432

 

 

 

 

 

 

 

 

 

 

 

 

432

 

Stock-based compensation

 

 

 

 

 

 

 

 

3,979

 

 

 

 

 

 

 

 

 

 

 

 

3,979

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

208

 

 

 

 

 

 

 

 

 

208

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(7,267

)

 

 

(19

)

 

 

(7,286

)

Balances as of September 30, 2023

 

 

181,166

 

 

$

181

 

 

$

1,093,494

 

 

$

(2,225

)

 

$

(1,043,282

)

 

$

855

 

 

$

49,023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4


 

 

 

Cerus Corporation Shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Additional
Paid-in

 

 

Accumulated
Other
Comprehensive

 

 

Accumulated

 

 

Noncontrolling

 

 

Total
Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Loss

 

 

Deficit

 

 

Interest

 

 

Equity

 

Balances as of December 31, 2021

 

 

173,670

 

 

$

174

 

 

$

1,048,936

 

 

$

(149

)

 

$

(964,342

)

 

$

998

 

 

$

85,617

 

Issuance of common stock from exercise of stock options,
   vesting of restricted stock units, and ESPP purchases

 

 

3,134

 

 

 

3

 

 

 

2,135

 

 

 

 

 

 

 

 

 

 

 

 

2,138

 

Stock-based compensation

 

 

 

 

 

 

 

 

6,426

 

 

 

 

 

 

 

 

 

 

 

 

6,426

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

(1,486

)

 

 

 

 

 

 

 

 

(1,486

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(12,284

)

 

 

 

 

 

(12,284

)

Balances as of March 31, 2022

 

 

176,804

 

 

$

177

 

 

$

1,057,497

 

 

$

(1,635

)

 

$

(976,626

)

 

$

998

 

 

$

80,411

 

Issuance of common stock from exercise of stock options and
   vesting of restricted stock units

 

 

274

 

 

 

 

 

 

256

 

 

 

 

 

 

 

 

 

 

 

 

256

 

Stock-based compensation

 

 

 

 

 

 

 

 

5,007

 

 

 

 

 

 

 

 

 

 

 

 

5,007

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

(518

)

 

 

 

 

 

 

 

 

(518

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(8,389

)

 

 

(6

)

 

 

(8,395

)

Balances as of June 30, 2022

 

 

177,078

 

 

$

177

 

 

$

1,062,760

 

 

$

(2,153

)

 

$

(985,015

)

 

$

992

 

 

$

76,761

 

Issuance of common stock from exercise of stock options,
   vesting of restricted stock units, and ESPP purchases

 

 

325

 

 

 

 

 

 

1,101

 

 

 

 

 

 

 

 

 

 

 

 

1,101

 

Stock-based compensation

 

 

 

 

 

 

 

 

5,768

 

 

 

 

 

 

 

 

 

 

 

 

5,768

 

Other comprehensive loss