10-Q 1 rgnx-20220930.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, 2022

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 001-37553

 

REGENXBIO Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

 

47-1851754

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

9804 Medical Center Drive

Rockville, MD

 

20850

(Address of principal executive offices)

 

(Zip Code)

(240) 552-8181

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

 

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

 

Title of each class

Trading symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.0001 per share

RGNX

The Nasdaq Global Select Market

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. Yes No

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). Yes No

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). Yes No

As of October 27, 2022, there were 43,293,631 shares of the registrant’s common stock, par value $0.0001 per share, issued and outstanding.

 

 


Table of Contents

 

REGENXBIO INC.

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2022

TABLE OF CONTENTS

 

 

 

PART I—FINANCIAL INFORMATION

 

 

 

 

 

 

 

Item 1.

 

Financial Statements (Unaudited)

 

3

 

 

Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021

 

3

 

 

Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended September 30, 2022 and 2021

 

4

 

 

Consolidated Statements of Stockholders’ Equity for the Three and Nine Months Ended September 30, 2022 and 2021

 

5

 

 

Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2022 and 2021

 

7

 

 

Notes to Consolidated Financial Statements

 

8

Item 2.

 

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

 

23

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

 

35

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

35

Item 3.

 

Defaults Upon Senior Securities

 

35

Item 4.

 

Mine Safety Disclosures

 

35

Item 5.

 

Other Information

 

35

Item 6.

 

Exhibits

 

36

Signatures

 

37

 


Table of Contents

 

INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act), and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). These statements express a belief, expectation or intention and are generally accompanied by words that convey projected future events or outcomes such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “assume,” “design,” “intend,” “expect,” “could,” “plan,” “potential,” “predict,” “seek,” “should,” “would” or by variations of such words or by similar expressions. We have based these forward-looking statements on our current expectations and assumptions and analyses in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. However, whether actual results and developments will conform with our expectations and predictions is subject to a number of risks, uncertainties, assumptions and other important factors, including, but not limited to:

our ability to establish and maintain development partnerships, including our collaboration with AbbVie to develop and commercialize RGX-314;
our ability to obtain and maintain regulatory approval of our product candidates and the labeling for any approved products;
the timing of enrollment, commencement and completion and the success of our clinical trials, including the timing and commencement of our AFFINITY DUCHENNE clinical trial;
the timing of commencement and completion and the success of preclinical studies conducted by us and our development partners;
the timely development and launch of new products;
the scope, progress, expansion and costs of developing and commercializing our product candidates;
our ability to obtain, maintain and enforce intellectual property protection for our product candidates and technology, and defend against third-party intellectual property-related claims;
our expectations regarding the development and commercialization of product candidates currently being developed by third parties that utilize our technology;
the impact of the COVID-19 pandemic on our business, operations and preclinical and clinical development timelines and plans;
our anticipated growth strategies;
our expectations regarding competition;
the anticipated trends and challenges in our business and the market in which we operate;
our ability to attract or retain key personnel;
the size and growth of the potential markets for our product candidates and the ability to serve those markets;
the rate and degree of market acceptance of any of our products that are approved;
our expectations regarding our expenses and revenue;
our expectations regarding the outcome of legal proceedings;
our expectations regarding regulatory developments in the United States and foreign countries; and
our ability to accurately predict how long our existing cash resources will be sufficient to fund our anticipated operating expenses.

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You should carefully read the factors discussed in the sections titled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Quarterly Report on Form 10-Q, our Annual Report on Form 10-K for the year ended December 31, 2021 and in our other filings with the U.S. Securities and Exchange Commission (the SEC) for additional discussion of the risks, uncertainties, assumptions and other important factors that could cause our actual results or developments to differ materially and adversely from those projected in the forward-looking statements. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on us or our businesses or operations. Such statements are not guarantees of future performance and actual results or developments may differ materially and adversely from those projected in the forward-looking statements. These forward-looking statements speak only as of the date of this report. Except as required by law, we disclaim any duty to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Available Information

Our principal offices are located at 9804 Medical Center Drive, Rockville, MD 20850, and our telephone number is (240) 552-8181. Our website address is www.regenxbio.com. The information contained in, or that can be accessed through, our website is not a part of, or incorporated by reference in, this Quarterly Report on Form 10-Q. We file annual, quarterly, and current reports, proxy statements, and other documents with the SEC under the Exchange Act. You may obtain any reports, proxy and information statements, and other information that we file electronically with the SEC at www.sec.gov.

You also may view and download copies of our SEC filings free of charge at our website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. The information contained on, or that can be accessed through, our website will not be deemed to be incorporated by reference in, and is not considered part of, this Quarterly Report on Form 10-Q. Investors should also note that we use our website, as well as SEC filings, press releases, public conference calls and webcasts, to announce financial information and other material developments regarding our business. We use these channels, as well as any social media channels listed on our website, to communicate with investors and members of the public about our business. It is possible that the information that we post on our social media channels could be deemed material information. Therefore, we encourage investors, the media and others interested in our company to review the information that we post on our social media channels.

As used in this Quarterly Report on Form 10-Q, the terms “REGENXBIO,” “we,” “us,” “our” or the “Company” mean REGENXBIO Inc. and its subsidiaries, on a consolidated basis, unless the context indicates otherwise.

AAVIATE, ALTITUDE, ATMOSPHERE, NAV, REGENXBIO and the REGENXBIO logos are our registered trademarks. Any other trademarks appearing in this Quarterly Report on Form 10-Q are the property of their respective holders.

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PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

REGENXBIO INC.

CONSOLIDATED BALANCE SHEETS

(unaudited)

(in thousands, except per share data)

 

 

 

September 30, 2022

 

 

December 31, 2021

 

Assets

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

118,544

 

 

$

345,209

 

Marketable securities

 

 

263,874

 

 

 

112,230

 

Accounts receivable, net

 

 

32,549

 

 

 

32,439

 

Prepaid expenses

 

 

14,824

 

 

 

18,752

 

Other current assets

 

 

6,848

 

 

 

10,196

 

Total current assets

 

 

436,639

 

 

 

518,826

 

Marketable securities

 

 

234,594

 

 

 

391,907

 

Accounts receivable, net

 

 

1,803

 

 

 

2,262

 

Property and equipment, net

 

 

140,906

 

 

 

131,547

 

Operating lease right-of-use assets

 

 

59,471

 

 

 

60,904

 

Restricted cash

 

 

2,030

 

 

 

2,030

 

Other assets

 

 

8,350

 

 

 

6,428

 

Total assets

 

$

883,793

 

 

$

1,113,904

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

$

25,210

 

 

$

11,387

 

Accrued expenses and other current liabilities

 

 

44,462

 

 

 

76,111

 

Deferred revenue

 

 

5,903

 

 

 

3,333

 

Operating lease liabilities

 

 

3,608

 

 

 

1,752

 

Liability related to sale of future royalties

 

 

44,365

 

 

 

37,889

 

Total current liabilities

 

 

123,548

 

 

 

130,472

 

Operating lease liabilities

 

 

84,673

 

 

 

84,929

 

Liability related to sale of future royalties

 

 

103,084

 

 

 

133,460

 

Other liabilities

 

 

8,664

 

 

 

745

 

Total liabilities

 

 

319,969

 

 

 

349,606

 

Stockholders’ equity

 

 

 

 

 

 

Preferred stock; $0.0001 par value; 10,000 shares authorized, no shares issued
   and outstanding at September 30, 2022 and December 31, 2021

 

 

 

 

 

 

Common stock; $0.0001 par value; 100,000 shares authorized at September 30, 2022
   and December 31, 2021;
43,292 and 42,831 shares issued and outstanding at
   September 30, 2022 and December 31, 2021, respectively

 

 

4

 

 

 

4

 

Additional paid-in capital

 

 

963,694

 

 

 

928,095

 

Accumulated other comprehensive loss

 

 

(18,256

)

 

 

(2,569

)

Accumulated deficit

 

 

(381,618

)

 

 

(161,232

)

Total stockholders’ equity

 

 

563,824

 

 

 

764,298

 

Total liabilities and stockholders’ equity

 

$

883,793

 

 

$

1,113,904

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

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REGENXBIO INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(unaudited)

(in thousands, except per share data)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

License and royalty revenue

 

$

26,512

 

 

$

30,773

 

 

$

81,379

 

 

$

71,692

 

Total revenues

 

 

26,512

 

 

 

30,773

 

 

 

81,379

 

 

 

71,692

 

Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues

 

 

13,094

 

 

 

14,105

 

 

 

41,762

 

 

 

28,775

 

Research and development

 

 

63,313

 

 

 

47,855

 

 

 

179,948

 

 

 

133,459

 

General and administrative

 

 

20,921

 

 

 

21,030

 

 

 

64,071

 

 

 

57,293

 

Credit losses and other

 

 

229

 

 

 

5,131

 

 

 

703

 

 

 

5,781

 

Total operating expenses

 

 

97,557

 

 

 

88,121

 

 

 

286,484

 

 

 

225,308

 

Loss from operations

 

 

(71,045

)

 

 

(57,348

)

 

 

(205,105

)

 

 

(153,616

)

Other Income (Expense)

 

 

 

 

 

 

 

 

 

 

 

 

Interest income from licensing

 

 

18

 

 

 

117

 

 

 

265

 

 

 

700

 

Investment income

 

 

1,497

 

 

 

5,535

 

 

 

3,357

 

 

 

6,514

 

Interest expense

 

 

(5,954

)

 

 

(6,709

)

 

 

(18,944

)

 

 

(19,777

)

Total other income (expense)

 

 

(4,439

)

 

 

(1,057

)

 

 

(15,322

)

 

 

(12,563

)

Loss before income taxes

 

 

(75,484

)

 

 

(58,405

)

 

 

(220,427

)

 

 

(166,179

)

Income Tax Benefit (Expense)

 

 

 

 

 

 

 

 

41

 

 

 

(4

)

Net loss

 

$

(75,484

)

 

$

(58,405

)

 

$

(220,386

)

 

$

(166,183

)

Other Comprehensive Loss

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized loss on available-for-sale securities, net

 

 

(3,493

)

 

 

(30

)

 

 

(15,687

)

 

 

(925

)

Total other comprehensive loss

 

 

(3,493

)

 

 

(30

)

 

 

(15,687

)

 

 

(925

)

Comprehensive loss

 

$

(78,977

)

 

$

(58,435

)

 

$

(236,073

)

 

$

(167,108

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share, basic and diluted

 

$

(1.75

)

 

$

(1.37

)

 

$

(5.11

)

 

$

(3.93

)

Weighted-average common shares outstanding, basic and diluted

 

 

43,251

 

 

 

42,629

 

 

 

43,103

 

 

 

42,324

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

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REGENXBIO INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited)

(in thousands)

 

 

 

Three Months Ended September 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Other

 

 

 

 

 

Total

 

 

 

Common Stock

 

 

Paid-in

 

 

Comprehensive

 

 

Accumulated

 

 

Stockholders’

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Loss

 

 

Deficit

 

 

Equity

 

Balances at June 30, 2022

 

 

43,171

 

 

$

4

 

 

$

951,412

 

 

$

(14,763

)

 

$

(306,134

)

 

$

630,519

 

Vesting of restricted stock units, net of tax

 

 

2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercise of stock options, net of tax

 

 

66

 

 

 

 

 

 

917

 

 

 

 

 

 

 

 

 

917

 

Issuance of common stock under employee
   stock purchase plan

 

 

53

 

 

 

 

 

 

1,120

 

 

 

 

 

 

 

 

 

1,120

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

10,245

 

 

 

 

 

 

 

 

 

10,245

 

Unrealized loss on available-for-sale securities, net

 

 

 

 

 

 

 

 

 

 

 

(3,493

)

 

 

 

 

 

(3,493

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(75,484

)

 

 

(75,484

)

Balances at September 30, 2022

 

 

43,292

 

 

$

4

 

 

$

963,694

 

 

$

(18,256

)

 

$

(381,618

)

 

$

563,824

 

 

 

 

Three Months Ended September 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Other

 

 

 

 

 

Total

 

 

 

Common Stock

 

 

Paid-in

 

 

Comprehensive

 

 

Accumulated

 

 

Stockholders’

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Loss

 

 

Deficit

 

 

Equity

 

Balances at June 30, 2021

 

 

42,555

 

 

$

4

 

 

$

905,346

 

 

$

(1,255

)

 

$

(396,850

)

 

$

507,245

 

Exercise of stock options

 

 

163

 

 

 

 

 

 

1,729

 

 

 

 

 

 

 

 

 

1,729

 

Issuance of common stock under employee
   stock purchase plan

 

 

35

 

 

 

 

 

 

1,141

 

 

 

 

 

 

 

 

 

1,141

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

9,734

 

 

 

 

 

 

 

 

 

9,734

 

Unrealized loss on available-for-sale securities, net

 

 

 

 

 

 

 

 

 

 

 

(30

)

 

 

 

 

 

(30

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(58,405

)

 

 

(58,405

)

Balances at September 30, 2021

 

 

42,752

 

 

$

4

 

 

$

917,950

 

 

$

(1,285

)

 

$

(455,255

)

 

$

461,414

 

 

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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Table of Contents

 

REGENXBIO INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited)

(in thousands)

 

 

 

Nine Months Ended September 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Other

 

 

 

 

 

Total

 

 

 

Common Stock

 

 

Paid-in

 

 

Comprehensive

 

 

Accumulated

 

 

Stockholders’

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Loss

 

 

Deficit

 

 

Equity

 

Balances at December 31, 2021

 

 

42,831

 

 

$

4

 

 

$

928,095

 

 

$

(2,569

)

 

$

(161,232

)

 

$

764,298

 

Vesting of restricted stock units, net of tax

 

 

57

 

 

 

 

 

 

(284

)

 

 

 

 

 

 

 

 

(284

)

Exercise of stock options, net of tax

 

 

329

 

 

 

 

 

 

2,761

 

 

 

 

 

 

 

 

 

2,761

 

Issuance of common stock under employee
   stock purchase plan

 

 

75

 

 

 

 

 

 

1,742

 

 

 

 

 

 

 

 

 

1,742

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

31,380

 

 

 

 

 

 

 

 

 

31,380

 

Unrealized loss on available-for-sale securities, net

 

 

 

 

 

 

 

 

 

 

 

(15,687

)

 

 

 

 

 

(15,687

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(220,386

)

 

 

(220,386

)

Balances at September 30, 2022

 

 

43,292

 

 

$

4

 

 

$

963,694

 

 

$

(