Sana Biotechnology, Inc. [SANA] Filings

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Emerging growth company

10-Q 1 sana-20230930.htm 10-Q 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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


☐	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: 001-39941

Sana Biotechnology, Inc.

(Exact Name of Registrant as Specified in its Charter)


Delaware	83-1381173
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
188 East Blaine Street, Suite 400 Seattle, Washington	98102
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (206) 701-7914

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, $0.0001 par value per share	SANA	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. 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, 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.

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 31, 2023, the registrant had 197,133,208 shares of common stock, $0.0001 par value per share, outstanding.

TABLE OF CONTENTS


		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	5
	Condensed Consolidated Balance Sheets	5
	Condensed Consolidated Statements of Operations	6
	Condensed Consolidated Statements of Comprehensive Income (Loss)	7
	Condensed Consolidated Statements of Stockholders’ Equity	8
	Condensed Consolidated Statements of Cash Flows	9
	Notes to Unaudited Condensed Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4.	Controls and Procedures	33
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	104
Item 3.	Defaults Upon Senior Securities	104
Item 4.	Mine Safety Disclosures	104
Item 5.	Other Information	104
Item 6.	Exhibits	105
	Signatures	106

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (Quarterly Report) contains forward-looking statements that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this Quarterly Report could be deemed forward-looking statements, including those statements highlighted below. In some cases, you can identify these statements by forward-looking words such as “aim,” “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “should,” “would,” or “will,” the negative of these terms, and other comparable terminology. These forward-looking statements, which are subject to risks, include, but are not limited to, statements about:

•

our expectations regarding the potential market size and size of the potential patient populations for our product candidates and any future product candidates, if approved for commercial use;

•

our clinical and regulatory development plans;

•

our expectations with regard to our preclinical studies, clinical trials, and research and development programs, including the timing and availability of data from such studies and trials;

•

the timing of commencement of future preclinical studies, clinical trials, and research and development programs;

•

our ability to acquire, discover, and develop product candidates and timely advance them into and through clinical data readouts and successful completion of clinical trials;

•

our expectations regarding the potential safety, efficacy, or clinical utility of our product candidates;

•

our intentions with respect to and our ability to establish collaborations or partnerships;

•

the timing or likelihood of regulatory filings and approvals for our product candidates;

•

our commercialization, marketing, and manufacturing expectations, including with respect to the buildout of our manufacturing facility and capabilities and the timing thereof;

•

impact of future regulatory, judicial, and legislative changes or developments in the United States and foreign countries;

•

our intentions with respect to the commercialization of our product candidates;

•

the pricing and reimbursement of our product candidates, if approved;

•

the potential effects of public health crises on our preclinical and clinical programs and business;

•

our expectations regarding the impact of global events and macroeconomic conditions on our business;

•

the implementation of our business model and strategic plans for our business and product candidates, including additional indications that we may pursue;

•

our ability to effectively manage our growth, including our ability to retain and recruit personnel, and maintain our culture;

•

the scope of protection we are able to establish and maintain for intellectual property rights covering our product candidates, including the projected terms of patent protection;

•

estimates of our expenses, future revenue, capital requirements, needs for additional financing, and ability to obtain additional capital;

•

our expected use of proceeds from our initial public offering and our existing cash, cash equivalents, and marketable securities;

•

the performance of our third-party suppliers and manufacturers;

•

our future financial performance;

•

our expectations regarding the duration for which we will be an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (JOBS Act); and

•

developments and projections relating to our competitors and our industry, including competing products.

We have based these forward-looking statements largely on our current expectations, estimates, forecasts, and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, and financial needs. In light of the significant uncertainties in these forward-looking statements, you should not rely upon forward-looking statements as predictions of future events. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Quarterly Report, we cannot guarantee that the future results, levels of activity, performance, or events and circumstances reflected in the forward-looking statements will be achieved or occur in a timely manner or at all. You should refer to the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. Other sections of this Quarterly Report may include additional factors that could harm our business and financial performance. 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, or implied by, any forward-looking statements. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Sana Biotechnology, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except per share amounts)


	September 30, 2023			December 31, 2022
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	168,448		$	176,765
Marketable securities		100,122			247,198
Restricted cash		3,832			6,100
Prepaid expenses and other current assets		7,120			14,374
Total current assets		279,522			444,437
Long-term marketable securities		-			10,051
Property and equipment, net		68,369			66,917
Operating lease right-of-use assets		77,235			92,486
Long-term restricted cash		-			4,408
Intangible asset		59,195			59,195
Goodwill		140,627			140,627
Other non-current assets		6,492			4,599
TOTAL ASSETS	$	631,440		$	822,720
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	9,928		$	2,857
Accrued compensation		24,286			26,362
Accrued expenses and other current liabilities		18,940			14,547
Operating lease liabilities		13,490			12,393
Contingent consideration		-			55,345
Total current liabilities		66,644			111,504
Operating lease liabilities, net of current portion		83,374			95,860
Contingent consideration, net of current portion		103,156			95,034
Success payment liabilities		12,414			21,007
Total liabilities		265,588			323,405
Commitments and contingencies (Note 9)
Stockholders' equity:
Preferred stock, $0.0001 par value; 50,000 shares authorized; zero shares issued and outstanding as of September 30, 2023 and December 31, 2022		-			-
Common stock, $0.0001 par value; 750,000 shares authorized; 197,064 and 191,022 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively		20			19
Additional paid-in capital		1,616,008			1,558,459
Accumulated other comprehensive loss		(202	)		(4,327	)
Accumulated deficit		(1,249,974	)		(1,054,836	)
Total stockholders' equity		365,852			499,315
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	631,440		$	822,720

See accompanying notes.

Sana Biotechnology, Inc.

Condensed Consolidated Statements of Operations

(unaudited)

(in thousands, except per share amounts)


	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Operating expenses:
Research and development	$	65,613		$	76,735		$	205,823		$	221,964
Research and development related success payments and contingent consideration		(82,615	)		(6,062	)		(55,816	)		(79,428	)
General and administrative		19,183			15,514			52,515			48,240
Total operating expenses		2,181			86,187			202,522			190,776
Loss from operations		(2,181	)		(86,187	)		(202,522	)		(190,776	)
Interest income, net		2,862			1,173			7,212			2,149
Other income (expense), net		303			(106	)		172			(406	)
Net income (loss)	$	984		$	(85,120	)	$	(195,138	)	$	(189,033	)
Net income (loss) per common share – basic	$	0.00		$	(0.45	)	$	(1.01	)	$	(1.01	)
Weighted-average number of common shares – basic		196,978			189,303			193,605			187,645
Net income (loss) per common share – diluted	$	0.00		$	(0.45	)	$	(1.01	)	$	(1.01	)
Weighted-average number of common shares – diluted		200,473			189,303			193,605			187,645

See accompanying notes.

Sana Biotechnology, Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(unaudited)

(in thousands)


	Three Months Ended September 30,					Nine Months Ended September 30,
	2023		2022			2023			2022
Net income (loss)	$	984	$	(85,120	)	$	(195,138	)	$	(189,033	)
Other comprehensive income (loss), net of tax:
Unrealized gain (loss) on marketable securities, net		663		(67	)		4,125			(5,048	)
Total comprehensive income (loss)	$	1,647	$	(85,187	)	$	(191,013	)	$	(194,081	)

See accompanying notes.

Sana Biotechnology, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(unaudited)

(in thousands)


	Common Stock				Additional Paid-In			Accumulated Other Comprehensive			Accumulated			Total Stockholders'
	Shares		Amount		Capital			Loss			Deficit			Equity
Balance as of December 31, 2022		191,022	$	19	$	1,558,459		$	(4,327	)	$	(1,054,836	)	$	499,315
Fees incurred related to issuance of common stock from at the market offering		-		-		(200	)		-			-			(200	)
Vesting of restricted stock		154		-		-			-			-			-
Exercise of stock options		233		-		331			-			-			331
Stock-based compensation expense		-		-		8,751			-			-			8,751
Unrealized gain on marketable securities, net		-		-		-			2,188			-			2,188
Net loss		-		-		-			-			(82,123	)		(82,123	)
Balance as of March 31, 2023		191,409	$	19	$	1,567,341		$	(2,139	)	$	(1,136,959	)	$	428,262
Issuance of common stock from at the market offering, net of issuance costs of $985		4,586		1		27,247									27,248
Vesting of restricted stock		119		-		-			-			-			-
Exercise of stock options		357		-		691			-			-			691
Issuance of common stock related to employee stock purchase plan		409		-		1,705			-			-			1,705
Stock-based compensation expense		-		-		9,848			-			-			9,848
Unrealized gain on marketable securities, net		-		-		-			1,274			-			1,274
Net loss		-		-		-			-			(113,999	)		(113,999	)
Balance as of June 30, 2023		196,880	$	20	$	1,606,832		$	(865	)	$	(1,250,958	)	$	355,029
Fees incurred related to issuance of common stock from at the market offering		-		-		(19	)		-			-			(19	)
Vesting of restricted stock		81		-		-			-			-			-
Exercise of stock options		103		-		192			-			-			192
Stock-based compensation expense		-		-		9,003			-			-			9,003
Unrealized gain on marketable securities, net		-		-		-			663			-			663
Net income		-		-		-			-			984			984
Balance as of September 30, 2023		197,064	$	20	$	1,616,008		$	(202	)	$	(1,249,974	)	$	365,852


	Common Stock				Additional Paid-In			Accumulated Other Comprehensive			Accumulated			Total Stockholders'
	Shares		Amount		Capital			Loss			Deficit			Equity
Balance as of December 31, 2021		184,929	$	18	$	1,515,210		$	(1,366	)	$	(785,360	)	$	728,502
Vesting of restricted stock		1,419		1		(1	)		-			-			-
Exercise of stock options		284		-		652			-			-			652
Stock-based compensation expense		-		-		7,755			-			-			7,755
Unrealized loss on marketable securities, net		-		-		-			(3,806	)		-			(3,806	)
Net loss		-		-		-			-			(31,448	)		(31,448	)
Balance as of March 31, 2022		186,632	$	19	$	1,523,616		$	(5,172	)	$	(816,808	)	$	701,655
Vesting of restricted stock		1,243		-		-			-			-			-
Exercise of stock options		320		-		571			-			-			571
Issuance of common stock related to employee stock purchase plan		235		-		1,008			-			-			1,008
Stock-based compensation expense		-		-		9,911			-			-			9,911
Unrealized loss on marketable securities, net		-		-		-			(1,175	)		-			(1,175	)
Net loss		-		-		-			-			(72,465	)		(72,465	)
Balance as of June 30, 2022		188,430	$	19	$	1,535,106		$	(6,347	)	$	(889,273	)	$	639,505
Issuance of common stock from at the market offering, net of issuance costs of $540		149		-		724			-			-			724
Vesting of restricted stock		927		-		-			-			-			-
Exercise of stock options		379		-		897			-			-			897
Stock-based compensation expense		-		-		10,080			-			-			10,080
Unrealized loss on marketable securities, net		-		-		-			(67	)		-			(67	)
Net loss		-		-		-			-			(85,120	)		(85,120	)
Balance as of September 30, 2022		189,885	$	19	$	1,546,807		$	(6,414	)	$	(974,393	)	$	566,019

See accompanying notes.

Sana Biotechnology, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(in thousands)


	Nine Months Ended September 30,
	2023			2022
OPERATING ACTIVITIES:
Net loss	$	(195,138	)	$	(189,033	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		13,293			11,430
Stock-based compensation expense		27,602			27,746
Change in the estimated fair value of contingent consideration		(47,223	)		(12,613	)
Change in the estimated fair value of success payment liabilities		(8,593	)		(66,815	)
Non-cash expense for operating lease right-of-use assets		10,031			8,859
Other non-cash items, net		(9,962	)

Sana Biotechnology, Inc. [SANA] Filings
10-Q	[2023-11-08]
10-Q	[2023-08-03]
10-Q	[2023-05-08]
10-K	[2023-03-16]
10-Q	[2022-11-02]
10-Q	[2022-08-04]
10-Q	[2022-05-10]
10-K	[2022-03-16]
10-Q	[2021-11-08]
10-Q	[2021-08-04]
10-Q	[2021-05-05]
10-K	[2021-03-24]
S-1	[2021-01-13]