10-Q 1 brhc10047697_10q.htm 10-Q.

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 December 31, 2022
OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 001-40782


ROIVANT SCIENCES LTD.
(Exact name of Registrant as specified in its Charter)


Bermuda

98-1173944
(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

7th Floor
50 Broadway
London SW1H 0DB
United Kingdom

Not Applicable
(Address of principal executive offices)

(Zip Code)
+44 207 400 3347
(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 Shares, $0.0000000341740141 per share ROIV The Nasdaq Global Market
Redeemable Warrants, each whole warrant exercisable for one Common Share at an exercise price of $11.50 per share
ROIVW
The Nasdaq Global 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. (Check one):

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 February 9, 2023, the registrant had 758,427,350 common shares, par value $0.0000000341740141 per share, outstanding (the “Common Shares”).



TABLE OF CONTENTS

     
   
Page
PART I—FINANCIAL INFORMATION
 
     
Item 1.
6
 
   
 
6
 
   
 
7
 
   
 
8
 
   
 
9
 
   
 
11
 
   
 
12
 
   
Item 2.
32
 
   
Item 3.
48
 
   
Item 4.
49
 
 
PART II—OTHER INFORMATION

 
   
Item 1.
50
 
   
Item 1A.
50
 
   
Item 2.
123
 
   
Item 3.
123
 
   
Item 4.
123
 
   
Item 5.
123
 
   
Item 6.
124
   
125

Where You Can Find More Information
Investors and others should note that we may announce material business and financial information to our investors using our investor relations website (https://investor.roivant.com), filings we make with the Securities and Exchange Commission (the “SEC”), our corporate twitter account (@Roivant), other social media platforms, webcasts, press releases and conference calls. Similarly, our subsidiary Immunovant, Inc. may announce material business and financial information to its investors using its investor relations website (https://immunovant.com/investors), filings it makes with the SEC, social media platforms, webcasts, press releases and conference calls. We and our public company subsidiaries use these mediums to communicate with our and our public company subsidiaries’ shareholders and the public about our company, our subsidiaries, our product candidates and other matters. It is possible that the information that we make available in this manner may be deemed to be material information. We therefore encourage investors and others interested in our company and our public company subsidiaries to review this information.
The above-referenced information is not incorporated by reference into this filing and the website addresses and Twitter account name are provided only as inactive textual references.
Summary Risk Factors
You should consider carefully the risks described under “Risk Factors” in Part II, Item 1.A of this Quarterly Report on Form 10-Q. Unless the context otherwise requires, references in this section to “we,” “us,” “our,” “Roivant” and the “Company” refer to Roivant Sciences Ltd. and its consolidated subsidiaries, as the context requires. A summary of the risks that could materially and adversely affect our business, financial condition, operating results and prospects include the following:
Risks Related to Our Business and Industry
 
Our limited operating history and the inherent uncertainties and risks involved in biopharmaceutical product development may make it difficult for us to execute on our business model and for you to assess our future viability.
 
We may never achieve or maintain profitability.
 
We will require additional capital to fund our operations, and if we fail to obtain necessary financing, we may not be able to successfully market our products, acquire or in-license new products or product candidates, complete the development and commercialization of our products and product candidates and continue to pursue our drug discovery efforts.
 
We have limited experience as a commercial company and the marketing and sale of VTAMA® (tapinarof) or any future products may be unsuccessful or less successful than anticipated.
 
Interim, top-line or preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data.
 
We may not be successful in our efforts to acquire, in-license or discover new product candidates.
 
We face risks associated with the allocation of capital and personnel across our businesses.
 
We face risks associated with the Vant structure.
 
The global pandemic resulting from the outbreak of the novel strain of coronavirus, SARS-CoV-2, which causes COVID-19, could adversely impact our business, including the marketing of our products and our ongoing clinical trials and preclinical studies.
 
Clinical trials and preclinical studies are very expensive, time-consuming, difficult to design and implement and involve uncertain outcomes. We may encounter substantial delays in clinical trials, or may not be able to conduct or complete clinical trials or preclinical studies on the expected timelines, if at all.
 
Our approach to the discovery and development of product candidates from our small molecule discovery engine is unproven, which makes it difficult to predict the time, cost of development and likelihood of successfully developing any product candidates from these platforms.
 
Certain of our product candidates are novel, complex and difficult to manufacture.
 
Obtaining approval of a new drug is an extensive, lengthy, expensive and inherently uncertain process, and the FDA or another regulator may delay, limit or deny approval.
 
Our clinical trials may fail to demonstrate substantial evidence of the safety and efficacy of product candidates that we may identify and pursue for their intended uses, which would prevent, delay or limit the scope of regulatory approval and commercialization.
 
Our products and product candidates may cause adverse effects or have other properties that could delay or prevent their regulatory approval, cause us to suspend or discontinue clinical trials, abandon further development or limit the scope of any approved label or market acceptance.
 
We depend on the knowledge and skills of our senior leaders and may not be able to manage our business effectively if we are unable to attract and retain key personnel.
 
We will need to expand our organization and may experience difficulties in managing this growth, which could disrupt operations.
 
If we are unable to obtain and maintain patent and other intellectual property protection for our technology, products and product candidates or if the scope of the intellectual property protection obtained is not sufficiently broad, we may not be able to compete effectively in our markets.
 
If the patent applications we hold or have in-licensed with respect to our products or product candidates fail to issue, if their breadth or strength of protection is threatened, or if they fail to provide meaningful exclusivity for our current and future products or product candidates, it could dissuade companies from collaborating with us to develop product candidates, and threaten our ability to commercialize our products.
 
Patent terms and their scope may be inadequate to protect our competitive position on current and future products and product candidates for an adequate amount of time.

Risks Related to Our Securities, Our Jurisdiction of Incorporation and Certain Tax Matters
 
If our performance does not meet market expectations, the price of our securities may decline.
 
We have incurred and will continue to incur increased costs as a result of operating as a public company and our management has devoted and will continue to devote a substantial amount of time to new compliance initiatives.
 
Our failure to timely and effectively implement controls and procedures required by Section 404(a) of the Sarbanes-Oxley Act could have a material adverse effect on our business.
 
Anti-takeover provisions in our memorandum of association, bye-laws and Bermuda law could delay or prevent a change in control, limit the price investors may be willing to pay in the future for our Common Shares and could entrench management.
 
Our largest shareholders and certain members of our management own a significant percentage of our Common Shares and will be able to exert significant control over matters subject to shareholder approval.
Forward-Looking Statements
This Quarterly Report on Form 10-Q contains statements, including matters discussed under Part I, Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” Part II, Item 1. “Legal Proceedings,” Part II, Item 1A. “Risk Factors” and in other sections of this report, that are “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Our forward-looking statements include, but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies regarding the future, and statements that are not historical facts. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.
The forward-looking statements contained in this Quarterly Report on Form 10-Q are based on our current expectations and beliefs concerning future developments and their potential effects on us taking into account information currently available to us. There can be no assurance that future developments affecting us will be those that we have anticipated. Should one or more of these risks or uncertainties materialize, they could cause our actual results to differ materially from the forward-looking statements. Some factors that could cause actual results to differ include, but are not limited to risk associated with:
 
our limited operating history and risks involved in biopharmaceutical product development;
 
our limited experience as a commercial-stage company and ability to successfully commercialize VTAMA® (tapinarof);
 
our ability to raise additional capital to fund our business on acceptable terms or at all;
 
the receipt of proceeds from the sale of the Myovant Top-Up Shares (as defined below) to Sumitomo (as defined below) in connection with the previously announced acquisition of Myovant Sciences Ltd. by Sumitomo, expected to close in the quarter ended March 31, 2023;
 
the fact that we will likely incur significant operating losses for the foreseeable future;
 
the impact of public health outbreaks, epidemics or pandemics (such as the COVID-19 pandemic) on our business (including our clinical trials and preclinical studies), operations and financial condition and results;
 
our ability to acquire, in-license or discover new product candidates;
 
our Vant structure and the potential that we may fail to capitalize on certain development opportunities;
 
clinical trials and preclinical studies, which are very expensive, time-consuming, difficult to design and implement and involve uncertain outcomes;
 
the unproven nature of our approach to the discovery and development of product candidates from our small molecule discovery engine;
 
the novelty, complexity and difficulty of manufacturing certain of our products and product candidates, including any manufacturing problems that result in delays in development or commercialization of our products and product candidates;
 
difficulties we may face in enrolling and retaining patients in clinical trials and/or clinical development activities;
 
the results of our clinical trials not supporting our proposed claims for a product candidate;
 
interim, top-line and/or preliminary data from our clinical trials changing as more data becoming available or data being delayed due to audit and verification processes;
 
changes in product manufacturing or formulation that could lead to the incurrence of costs or delays;
 
the failure of any third-party we contract with to conduct, supervise and monitor our clinical trials to perform in a satisfactory manner or to comply with applicable requirements;
 
the fact that obtaining approvals for new drugs is a lengthy, extensive, expensive and unpredictable process that may end with our inability to obtain regulatory approval by the FDA or other regulatory agencies in other jurisdictions;
 
the failure of our clinical trials to demonstrate substantial evidence of the safety and efficacy of our products and product candidates, including, but not limited to, scenarios in which our products and product candidates may cause adverse effects that could delay regulatory approval, discontinue clinical trials, limit the scope of approval or generally result in negative media coverage of us;

 
our inability to obtain regulatory approval for a product or product candidate in certain jurisdictions, even if we are able to obtain approval in certain other jurisdictions;
 
our ability to effectively manage growth and to attract and retain key personnel;
 
any business, legal, regulatory, political, operational, financial and economic risks associated with conducting business globally;
 
our ability to obtain and maintain patent and other intellectual property protection for our technology, products and product candidates;
 
the inadequacy of patent terms and their scope to protect our competitive position;
 
the failure to issue (or the threatening of their breadth or strength of protection) or provide meaningful exclusivity for our current and future products and product candidates of our patent applications that we hold or have in-licensed;
 
the fact that we do not currently and may not in the future own or license any issued composition of matter patents covering certain of our products and product candidates and our inability to be certain that any of our other issued patents will provide adequate protection for such products and product candidates;
 
the fact that our largest shareholders (and certain members of our management team) own a significant percentage of our stock and will be able to exert significant control over matters subject to shareholder approval;
 
the outcome of any pending or potential litigation, including but not limited to our expectations regarding the outcome of any such litigation and costs and expenses associated with such litigation;
 
changes in applicable laws or regulations;
 
the possibility that we may be adversely affected by other economic, business and/or competitive factors; and
 
any other risks and uncertainties, including those described under Part II, Item 1A. “Risk Factors.”
These risks are not exhaustive. New risk factors emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.


PART I—FINANCIAL INFORMATION

Item 1.
Financial Statements (Unaudited).
 
ROIVANT SCIENCES LTD.
Condensed Consolidated Balance Sheets
(unaudited, in thousands, except share and per share amounts)

   
December 31, 2022
   
March 31, 2022
 
Assets
           
Current assets:
           
Cash and cash equivalents
 
$
1,527,437
   
$
2,060,400
 
Other current assets
   
118,795
     
86,123
 
Total current assets
   
1,646,232
     
2,146,523
 
Property and equipment, net
   
37,295
     
25,905
 
Operating lease right-of-use assets
   
54,636
     
61,044
 
Investments measured at fair value
   
272,469
     
325,834
 
Intangible assets, net
   
146,105
     
 
Other assets
   
46,223
     
25,823
 
Total assets
 
$
2,202,960
   
$
2,585,129
 
Liabilities, Redeemable Noncontrolling Interest and Shareholders’ Equity
               
Current liabilities:
               
Accounts payable
 
$
47,999
   
$
34,583
 
Accrued expenses
   
132,359
     
127,531
 
Operating lease liabilities
   
11,863
     
11,398
 
Current portion of long-term debt (includes $27,010 accounted for under the fair value option at December 31, 2022)
   
37,724
     
 
Other current liabilities
   
14,310
     
10,855
 
Total current liabilities
   
244,255
     
184,367
 
Liability instruments measured at fair value
   
80,041
     
44,912
 
Operating lease liabilities, noncurrent
   
54,925
     
62,468
 
Long-term debt, net of current portion (includes $183,510 and $177,400  accounted for under the fair value option at December 31, 2022 and March 31, 2022, respectively)
   
375,124
     
210,025
 
Other liabilities
   
21,477
     
21,923
 
Total liabilities
   
775,822
     
523,695
 
Commitments and contingencies (Note 11)
           
Redeemable noncontrolling interest
   
     
22,491
 
Shareholders’ equity:
               
Common shares, par value $0.0000000341740141 per share, 7,000,000,000 shares authorized and 726,804,831 and 694,975,965 shares issued and outstanding at December 31, 2022 and March 31, 2022, respectively
   
     
 
Additional paid-in capital
    4,695,386      
4,421,614
 
Accumulated deficit
   
(3,739,137
)
   
(2,763,724
)
Accumulated other comprehensive loss
   
(729
)
   
(946
)
Shareholders’ equity attributable to Roivant Sciences Ltd.
   
955,520
     
1,656,944
 
Noncontrolling interests
   
471,618
     
381,999
 
Total shareholders’ equity
   
1,427,138
     
2,038,943
 
Total liabilities, redeemable noncontrolling interest and shareholders’  equity
 
$
2,202,960
   
$
2,585,129
 

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

ROIVANT SCIENCES LTD.
Condensed Consolidated Statements of Operations
(unaudited, in thousands, except share and per share amounts)

   
Three Months Ended December 31,
   
Nine Months Ended December 31,
 
   
2022
   
2021
    2022
    2021
 
Revenue, net
 
$
17,052
   
$
24,341
    $ 33,904     $ 46,063  
Operating expenses:
                               
Cost of revenues
   
3,586
     
1,384
      8,953       8,507  
Research and development (includes $6,888 and $17,669 of share-based compensation expense for the three months ended December 31, 2022 and 2021 and $26,548 and $47,441 for the nine months ended December 31, 2022 and 2021, respectively)
   
125,533
     
137,345
      393,358       347,958  
Acquired in-process research and development
   
97,749
     
16,105
      97,749       138,377  
Selling, general and administrative (includes $50,741 and $53,547 of share-based compensation expense for the three months ended December 31, 2022 and 2021 and $165,771 and $440,356 for the nine months ended December 31, 2022 and 2021, respectively)
   
168,261
     
115,530
      474,996       636,060  
Total operating expenses
   
395,129
     
270,364
      975,056       1,130,902  
Loss from operations
   
(378,077
)
   
(246,023
)
    (941,152 )     (1,084,839 )
Change in fair value of investments
   
(25,948
)
   
38,036
      53,277       14,382  
Gain on sale of investment
                      (443,754 )
Change in fair value of debt and liability instruments
   
62,360
     
23,017
      90,032       40,747  
Gain on termination of Sumitomo Options
   
     
            (66,472 )
Gain on deconsolidation of subsidiaries
    (12,514 )           (29,276 )      
Other (income) expense, net
   
(19,898
)
   
(1,029
)
    (9,567 )     2,529  
Loss before income taxes
   
(382,077
)
   
(306,047
)
    (1,045,618 )     (632,271 )
Income tax expense
   
2,819
     
38
      8,983       532  
Net loss
   
(384,896
)
   
(306,085
)
    (1,054,601 )     (632,803 )
Net loss attributable to noncontrolling interests
   
(32,882
)
   
(21,549
)
    (79,188 )     (57,603 )
Net loss attributable to Roivant Sciences Ltd.
 
$
(352,014
)
 
$
(284,536
)
  $ (975,413 )   $ (575,200 )
Net loss per common share—basic and diluted(1)
 
$
(0.49
)
 
$
(0.41
)
  $ (1.39 )   $ (0.87 )
Weighted average shares outstanding—basic and diluted(1)
   
713,319,399
     
686,589,478
      703,054,773       662,268,788  

(1)
Retroactively restated for the stock subdivision as described in Note 8.

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

ROIVANT SCIENCES LTD.
Condensed Consolidated Statements of Comprehensive Loss
(unaudited, in thousands)

   
Three Months Ended
December 31,
   
Nine Months Ended
December 31,
 
   
2022
   
2021
    2022
    2021
 
Net loss
 
$
(384,896
)
 
$
(306,085
)
  $ (1,054,601 )   $ (632,803 )
Other comprehensive (loss) income:
                               
Foreign currency translation adjustment
   
(8,972
)
   
(2,393
)
    547       (2,287 )
Total other comprehensive (loss) income
   
(8,972
)
   
(2,393
)
    547       (2,287 )
Comprehensive loss
   
(393,868
)
   
(308,478
)
    (1,054,054 )     (635,090 )
Comprehensive loss attributable to noncontrolling interests
   
(32,036
)
   
(21,591
)
    (78,858 )     (57,375 )
Comprehensive loss attributable to Roivant Sciences Ltd.
 
$
(361,832
)
 
$
(286,887
)
  $ (975,196 )   $ (577,715 )

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

ROIVANT SCIENCES LTD.
Condensed Consolidated Statements of Shareholders’ Equity and Redeemable Noncontrolling Interest
(unaudited, in thousands, except share data)

         
Shareholders’ Equity
 
   
Redeemable
Noncontrolling
Interest
   

   
Additional
Paid-in
Capital
   
Accumulated
Other
Comprehensive
Income (Loss)
   
Accumulated
Deficit
   
Noncontrolling
Interests
   
Total
Shareholders’
Equity
 
    Common Stock  
   
Shares
   
Amount
 
Balance at March 31, 2022
 
$
22,491
     
694,975,965
   
$
   
$
4,421,614
   
$
(946
)
 
$
(2,763,724
)
 
$
381,999
   
$
2,038,943
 
Issuance of subsidiary common shares to the Company
   
     
     
     
(251
)
   
     
     
251
     
 
Issuance of common shares in connection with equity incentive plans and tax withholding payments
   
      4,739,781             (8,329 )                       (8,329 )
Issuance of the Company’s common shares related to settlement of transaction consideration
   
     
1,455,719
     
     
     
     
     
     
 
Share-based compensation
   
     
     
     
61,590
     
     
     
11,204
     
72,794
 
Foreign currency translation adjustment
   
     
     
     
     
5,966
     
     
(199
)
   
5,767
 
Net loss
   
     
     
     
     
     
(331,809
)
   
(21,975
)
   
(353,784
)
Balance at June 30, 2022
 
$
22,491
     
701,171,465
   
$
   
$
4,474,624
   
$
5,020
   
$
(3,095,533
)
 
$
371,280
   
$
1,755,391
 
Issuance of subsidiary common shares to the Company and cash contributions to majority-owned subsidiaries
   
                  (2,240 )                 2,240        
Deconsolidation of subsidiary
    (22,491 )    
                                     
Issuance of common shares in connection with equity incentive plans
   
      1,185,639                                      
Issuance of the Company’s common shares and other consideration for an acquisition
   
      2,029,877             8,836                   112       8,948  
Share-based compensation
   
     
            57,415                   4,564       61,979  
Foreign currency translation adjustment
   
     
                  4,069             (317 )     3,752  
Net loss
   
     
                        (291,590 )     (24,331 )     (315,921 )
Balance at September 30, 2022
  $       704,386,981     $     $ 4,538,635     $ 9,089     $ (3,387,123 )   $ 353,548     $ 1,514,149  
Issuance of the Company’s common shares, net of issuance costs
   
      20,000,000             94,735                         94,735  
Issuance of common shares in connection with equity incentive plans and tax withholding payments
          2,417,850             (982 )                       (982 )
Issuance of subsidiary common shares to the Company and cash contributions to majority-owned subsidiaries
                      (2,822 )                 2,822        
Issuance of subsidiary common shares, net of issuance costs
                      19,599                   48,129       67,728  
Subsidiary stock options exercised
                      260                   177       437  
Deconsolidation of subsidiary
                                        (292 )     (292 )
Issuance of subsidiary preferred shares
                                        87,500       87,500  
Share-based compensation
                      45,961                   11,770       57,731  
Foreign currency translation adjustment
                            (9,818 )           846       (8,972 )
Net loss
                                  (352,014 )     (32,882 )     (384,896 )
Balance at December 31, 2022
  $       726,804,831     $     $ 4,695,386     $ (729 )   $ (3,739,137 )   $ 471,618     $ 1,427,138  

         
Shareholders’ Equity(1)
 
   
Redeemable
Noncontrolling
Interest
   

   
Additional
Paid-in
Capital
   
Subscription
Receivable
   
Accumulated
Other
Comprehensive
Income (Loss)
   
Accumulated
Deficit
   
Noncontrolling
Interests
   
Total
Shareholders’
Equity
 
    Common Stock  
   
Shares
   
Amount
 
Balance at March 31, 2021
 
$
22,491
     
651,576,293
   
$
   
$
3,814,805
   
$
(100,000
)
 
$
1,445
   
$
(1,918,462
)
 
$
241,726
   
$
2,039,514
 
Issuance of subsidiary warrants
   
     
     
     
2,051
     
     
     
     
24
     
2,075
 
Cash contribution to majority-owned subsidiaries
   
     
     
     
(2,973
)
   
     
     
     
2,973
     
 
Share-based compensation
   
     
     
     
11,091
     
     
     
     
8,178
     
19,269
 
Foreign currency translation adjustment
   
     
     
     
     
     
(2,652
)
   
     
213
     
(2,439
)
Net loss
   
     
     
     
     
     
     
(82,183
)
   
(18,895
)
   
(101,078
)
Balance at June 30, 2021
 
$
22,491
     
651,576,293
   
$
   
$
3,824,974
   
$
(100,000
)
 
$
(1,207
)
 
$
(2,000,645
)
 
$
234,219
   
$
1,957,341
 
Issuance of the Company’s common shares upon closing of Business Combination and PIPE Financing, net of issuance costs
   
      32,372,478             129,097                               129,097  
Issuance of the Company’s common shares related to settlement of transaction consideration
   
      840,398                                            
Issuance of subsidiary preferred shares
   
     
                                    70,000       70,000  
Issuance of subsidiary common and preferred shares to the Company and cash contribution to majority-owned subsidiaries
   
     
            (54,779 )                       54,779        
Payment of subscription receivable
   
     
            (40,000 )     100,000                   40,000       100,000  
Share-based compensation
   
     
            386,568                         10,744       397,312  
Repurchase of equity awards
   
     
                                    (2,247 )     (2,247 )
Foreign currency translation adjustment
   
     
                        2,488             57       2,545  
Net loss
   
     
                              (208,481 )     (17,159 )     (225,640 )
Balance at September 30, 2021
  $ 22,491       684,789,169     $     $ 4,245,860     $     $ 1,281     $ (2,209,126 )   $ 390,393     $ 2,428,408  
Issuance of the Company’s common shares
   
      7,223,014             56,116                               56,116  
Cash contribution to majority-owned subsidiaries
                      (1,175 )                       1,175        
Share-based compensation
                      59,651                         11,565       71,216  
Foreign currency translation adjustment
                                  (2,351 )           (42 )     (2,393 )
Net loss
                                        (284,536 )     (21,549 )     (306,085 )
Balance at December 31, 2021
  $ 22,491       692,012,183     $     $ 4,360,452     $     $ (1,070 )   $ (2,493,662 )   $ 381,542     $ 2,247,262  

(1)
Retroactively restated for the stock subdivision as described in Note 8.

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

ROIVANT SCIENCES LTD.
Condensed Consolidated Statements of Cash Flows
(unaudited, in thousands)

   
Nine Months Ended December 31,
 
   
2022
   
2021
 
Cash flows from operating activities:
           
Net loss
 
$
(1,054,601
)
 
$
(632,803
)
Adjustments to reconcile net loss to net cash used in operating activities:
               
Non-cash acquired in-process research and development
    87,749       78,223  
Share-based compensation
   
192,504
     
487,797
 
Change in fair value of investments
   
53,277
     
14,382
 
Gain on sale of investment
          (443,754 )
Change in fair value of debt and liability instruments
   
90,032
     
40,747
 
Gain on deconsolidation of subsidiaries
    (29,276 )      
Gain on termination of Sumitomo Options
   
     
(61,472
)
Depreciation and amortization
    12,904       4,226  
Non-cash lease expense
    6,009       5,404  
Other
   
(8,066
)
   
(1,161
)
Changes in assets and liabilities, net of effects from acquisition and divestiture:
               
Other current assets
    (31,037 )     (16,064 )
Accounts payable
   
13,970
     
3,693
 
Accrued expenses
   
5,702
     
35,576
 
Deferred consideration liability
          (50,000 )
Operating lease liabilities
   
(6,814
)
   
(6,171
)
Other
   
3,342
   
11,117
Net cash used in operating activities
   
(664,305
)
   
(530,260
)
Cash flows from investing activities:
               
Cash decrease upon deconsolidation of subsidiaries
    (6,706 )      
Proceeds from sale of investment
   
      320,170
 
Milestone payments
    (140,136 )      
Purchase of property and equipment
   
(11,068
)
   
(11,173
)
Other
    88        
Net cash (used in) provided by investing activities
   
(157,822
)
   
308,997
 
Cash flows from financing activities:
               
Proceeds from issuance of the Company’s common shares, net of issuance costs paid
    94,735        
Proceeds from Business Combination and PIPE Financing
          213,424  
Proceeds from issuance of subsidiary common shares, net of issuance costs paid
    67,727        
Proceeds from payment of subscription receivable
          100,000  
Proceeds from subsidiary debt financings, net of financing costs paid
   
159,899
     
36,400
 
Repayment of debt by subsidiary
   
(22,108
)
   
(21,590
)
Payment of offering and loan origination costs
   
(2,250
)
   
(20,265
)
Repurchase of equity awards
          (2,247 )
Taxes paid related to net settlement of equity awards
   
(9,442
)
   
 
Proceeds from exercise of the Company’s and subsidiary stock options
    569        
Net cash provided by financing activities
   
289,130
     
305,722
 
Net change in cash, cash equivalents and restricted cash
   
(532,997
)
   
84,459
 
Cash, cash equivalents and restricted cash at beginning of period
   
2,074,034
     
2,141,676
 
Cash, cash equivalents and restricted cash at end of period
 
$
1,541,037
   
$
2,226,135
 
Non-cash investing and financing activities:
               
Issuance of the Company’s common shares and other consideration for an acquisition
 
$
9,694
   
$
 
Other
 
$
7,063