Trevi Therapeutics, Inc. [TRVI] Filings

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

10-Q 1 trvi-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: 001-38886

TREVI THERAPEUTICS, INC.

(Exact Name of Registrant as Specified in its Charter)


Delaware	45-0834299
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
195 Church Street, 16th Floor New Haven, Connecticut	06510
(Address of principal executive offices)	(Zip Code)

(203) 304-2499

(Registrant’s telephone number, including area code)

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, $0.001 par value per share

TRVI

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, 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.

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 November 9, 2023, the registrant had 63,857,622 shares of common stock, $0.001 par value per share, outstanding.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INDUSTRY DATA

This Quarterly Report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future operations, future financial position, future revenues and profitability, projected costs, prospects, plans and objectives of management, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “would,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

The forward-looking statements in this Quarterly Report on Form 10-Q include, among other things, statements about:

•

our clinical trials, including our planned trials of Haduvio for the treatment of chronic cough in idiopathic pulmonary fibrosis, or IPF, our Phase 2a RIVER clinical trial of Haduvio for the treatment of refractory chronic cough and our Phase 2b/3 PRISM trial of Haduvio for the treatment of prurigo nodularis;

•

our plans to develop and, if approved, subsequently commercialize Haduvio for the treatment of chronic cough in IPF and refractory chronic cough and for the treatment of prurigo nodularis;

•

our expectations regarding the timing for the initiation of clinical trials and the reporting of data from such trials;

•

the timing of and our ability to submit applications for and to obtain and maintain regulatory approvals for Haduvio;

•

our expectations regarding our ability to fund our operating expenses, including our ongoing and planned clinical trials, with our cash, cash equivalents and marketable securities;

•

our estimates regarding expenses, future revenue, timing of any future revenue, capital requirements and needs for additional financing;

•

the impact of government laws and regulations;

•

our competitive position; and

•

our ability to establish and maintain collaborations.

We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. We have included important factors in the cautionary statements included in this Quarterly Report on Form 10-Q, particularly in the section titled “Risk Factors,” that we believe could cause actual results or events to differ materially from the forward-looking statements that we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or investments we may make.

You should read this Quarterly Report on Form 10-Q and the documents that we have filed as exhibits to this Quarterly Report on Form 10-Q completely and with the understanding that our actual future results may differ materially from what we expect. The forward-looking statements contained in this Quarterly Report on Form 10-Q are made as of the date of this Quarterly Report on Form 10-Q, and we do not assume any obligation to update any forward-looking statements except as required by applicable law.

This report includes statistical and other industry and market data that we obtained from industry publications and research, surveys, and studies conducted by third parties as well as our own estimates. All of the market data used in this report involve a number of assumptions and limitations, and you are cautioned not to give undue weight to such data. Industry publications and third-party research, surveys, and studies generally indicate that their information has been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. Our estimates of the potential market opportunities for Haduvio include several key assumptions based on our industry knowledge, industry publications, third-party research, and other surveys, which may be based on a small sample size and may fail to accurately reflect market opportunities. While we believe that our internal assumptions are reasonable, no independent source has verified such assumptions.

We own or have rights to trademarks, service marks and trade names that we use in connection with the operation of our business, including our corporate name, logos and website names. We own the trademarks Trevi® and Haduvio™. Other trademarks, service marks and trade names appearing in this Quarterly Report on Form 10-Q are the property of their respective owners. Solely for convenience, some of the trademarks, service marks and trade names referred to in this Quarterly Report on Form 10-Q are listed without the ® and ™ symbols, but we will assert, to the fullest extent under applicable law, our rights to our trademarks, service marks and trade names. We intend to propose Haduvio as the trade name for our oral nalbuphine ER investigational product.

RISK FACTOR SUMMARY

The following is a summary of the principal factors that make an investment in our company speculative or risky. This summary does not address all of the risks and uncertainties that we face. Additional risk and uncertainties not presently known to us or that we presently deem less significant may also impair our business operations. Additional discussion of the risks summarized in this summary and other risks that we face, can be found in the “Risk Factors” section of this Quarterly Report on Form 10-Q and should be carefully considered, together with other information in this Quarterly Report on Form 10-Q and our other filings with the Securities and Exchange Commission, before making an investment decision regarding our common stock. The forward-looking statements discussed above are qualified by these risk factors. If any of the following risks occur, our business, financial condition, results of operations and future growth prospects could be materially and adversely affected.

•

We have incurred significant losses since inception and expect to continue to incur significant and increasing losses for the foreseeable future. We may never achieve or maintain profitability.

•

We will need substantial additional funding. If we are unable to raise sufficient capital when needed on acceptable terms or at all, we could be forced to delay, reduce or abandon our product development programs or commercialization efforts.

•

We are dependent on the successful development and commercialization of Haduvio, our sole product candidate. If we are unable to complete the clinical development of, obtain marketing approval for or successfully commercialize Haduvio or if we experience significant delays in doing so, our business would be substantially harmed.

•

We are in the process of designing future clinical trials of Haduvio for the treatment of chronic cough in IPF and have initiated our Phase 2a RIVER trial of Haduvio for the treatment of refractory chronic cough. Before initiating the trials at sites in the U.S., we will need to submit an IND for Haduvio to the U.S. Food and Drug Administration, or FDA. Prior to initiating the trials at sites outside the U.S., we will need to complete regulatory submissions in countries selected for the trials. Changes in the design of ongoing or planned trials or regulatory delays may affect the timing and costs of the trials and changes in the timing or costs of the trials for these or other reasons may affect our ability to complete the planned trials with our existing cash resources.

•

The outcome of clinical trials may not be predictive of the success of later clinical trials. For instance, Haduvio may fail to show the desired safety and efficacy in clinical development despite demonstrating positive results in earlier clinical trials. The results of our Phase 2 CANAL trial may not be predictive of the results of future trials of Haduvio for the treatment of chronic cough in IPF or our Phase 2a RIVER clinical trial of Haduvio for the treatment of refractory chronic cough, and the results of our Phase 2b/3 PRISM trial in Haduvio for the treatment of prurigo nodularis may not be predictive of the results of any future trial in prurigo nodularis.

•

We have experienced delays and difficulties in the enrollment of subjects in our clinical trials in the past, including in our Phase 2 CANAL trial and our Phase 2b/3 PRISM trial. If we experience delays or difficulties in the enrollment of subjects in future clinical trials, our receipt of necessary regulatory approvals could be delayed or prevented. Other companies are conducting clinical trials or have announced plans for future clinical trials that are seeking or are likely to seek to enroll subjects with IPF, refractory chronic cough and prurigo nodularis, and subjects are generally only able to enroll in a single trial at a time. In addition, many patients use various treatments off-label to treat chronic cough associated with IPF, refractory chronic cough and prurigo nodularis, and these patients and their physicians may be reluctant to forgo, discontinue or otherwise alter their use of such off-label therapeutic approaches to participate in our clinical trials.

•

Clinical drug development involves a lengthy and expensive process with an uncertain outcome. Even if we complete the necessary preclinical studies and clinical trials, the regulatory approval process is expensive, time-consuming and uncertain, which may prevent us from obtaining approvals for the commercialization of Haduvio or any future product candidate.

•

Adverse events or undesirable side effects caused by, or other unexpected properties of, Haduvio or any future project candidate may be identified during development and could delay or prevent the marketing approval or limit the use of Haduvio or any future product. Haduvio, as a mixed κ-opioid receptor agonist and μ-opioid receptor antagonist, may be susceptible to side effects associated with drugs having either of those mechanisms of action, including psychiatric side effects, withdrawal effects, respiratory depression and potential cardiac risk, as well as endocrine side effects associated with opioids generally.

•

The drug label for nalbuphine, the active ingredient in Haduvio, carries an opioid class label warning for serious, life-threatening or fatal respiratory depression and Haduvio, if approved for marketing in any indication, will likely carry a similar opioid class label. We intend to conduct a Phase 1b study of Haduvio to evaluate the effect of Haduvio on respiratory physiology in patients with IPF of varying disease severity. If there is a safety signal in the Phase 1b study, it could affect our ability to conduct a trial in this patient population.

•

Many currently approved μ-opioid products are subject to restrictive marketing and distribution regulations which, if applied to Haduvio, could potentially restrict its use and harm our ability to generate profits. We are conducting a human abuse

potential, or HAP, study to determine the abuse potential of oral nalbuphine ER relative to intravenous, or IV, butorphanol. If the results of the HAP study suggest that Haduvio may carry risks of misuse, abuse or addiction or even if the trial indicates that Haduvio does not carry such risks, the FDA may require us to implement a Risk Evaluation and Mitigation Strategy in connection with any commercialization of Haduvio and the U.S. Drug Enforcement Agency could determine that Haduvio should be classified as a controlled substance.

•

If we are unable to establish sales, marketing and distribution capabilities or enter into sales, marketing and distribution arrangements with third parties, we may not be successful in commercializing Haduvio or any future product candidates if and when they are approved.

•

We face substantial competition, which may result in others developing or commercializing products before or more successfully than we do.

•

We contract with third parties to conduct our clinical trials and for the manufacture, storage, packaging and distribution of Haduvio and other drug product for clinical trials, including a single supplier for the active ingredient in Haduvio. We expect to continue to rely on third parties for these services in connection with our future development and commercialization efforts for Haduvio. If they do not perform satisfactorily or if they experience delays or shortages, our business could be harmed.

•

If we fail to comply with our obligations under our existing and any future intellectual property licenses with third parties, including our license with Endo Pharmaceuticals Inc., we could lose license rights that are critical to our business or owe damages to the licensor of such intellectual property.

•

If we are unable to obtain and maintain sufficient patent protection for Haduvio or any future product candidate and the disease indications for which we are developing or may in the future develop Haduvio or any other product candidate, or if the scope of the patent protection is not sufficiently broad, competitors could develop and commercialize products similar or identical to such product candidate and our ability to successfully commercialize such product candidate may be adversely affected.

•

The number of shares of common stock underlying our outstanding warrants is significant in relation to our currently outstanding common stock, which could have a negative effect on the market price of our common stock and make it more difficult for us to raise funds through future equity financings.

Table of Contents


		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Comprehensive Loss	2
	Condensed Consolidated Statements of Stockholders’ Equity	3
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	30
Item 4.	Controls and Procedures	31
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	31
Item 1A.	Risk Factors	31
Item 6.	Exhibits	74
Signatures		76

PART I—FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements.

Trevi Therapeutics, Inc.

Condensed Consolidated Balance Sheets

(Amounts in thousands, except share and per share amounts)


	September 30, 2023			December 31, 2022
Assets	(Unaudited)
Current assets:
Cash and cash equivalents	$	25,965		$	12,589
Marketable securities		62,903			107,921
Prepaid expenses		4,039			795
Other current assets		1,046			1,311
Total current assets		93,953			122,616
Operating lease right-of-use assets		1,190			24
Other non-current assets		297			205
Property, equipment and leasehold improvements, net		238			170
Finance lease right-of-use assets		218			—
Total assets	$	95,896		$	123,015
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	1,256		$	2,857
Accrued expenses		3,625			3,518
Operating lease liabilities		171			25
Finance lease liabilities		121			—
Term loan		—			7,000
Total current liabilities		5,173			13,400
Operating lease liabilities		1,051			2
Finance lease liabilities		62			—
Term loan		—			2,151
Other non-current liabilities		—			3
Total liabilities		6,286			15,556
Commitments and contingencies (Note 12)
Stockholders’ equity:
Preferred stock: $0.001 par value; 5,000,000 shares authorized at September 30, 2023 and December 31, 2022; no shares issued or outstanding at September 30, 2023 and December 31, 2022.		—			—
Common stock: $0.001 par value; 200,000,000 shares authorized at September 30, 2023 and December 31, 2022; and 63,855,330 and 59,943,430 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively.		64			60
Additional paid-in capital		321,076			317,590
Accumulated other comprehensive loss		(217	)		(122	)
Accumulated deficit		(231,313	)		(210,069	)
Total stockholders’ equity		89,610			107,459
Total liabilities and stockholders’ equity	$	95,896		$	123,015

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

Trevi Therapeutics, Inc.

Condensed Consolidated Statements of Comprehensive Loss

(unaudited)

(Amounts in thousands, except share and per share amounts)


	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Operating expenses:
Research and development	$	6,323		$	5,769		$	17,165		$	15,517
General and administrative		2,722			2,636			7,825			7,733
Total operating expenses		9,045			8,405			24,990			23,250
Loss from operations		(9,045	)		(8,405	)		(24,990	)		(23,250	)
Other income (expense):
Interest income, net		1,183			424			3,611			623
Other income, net		154			—			472			—
Interest expense		(3	)		(292	)		(387	)		(889	)
Change in fair value of term loan derivative liability		—			—			—			(147	)
Total other income (expense), net		1,334			132			3,696			(413	)
Loss before income taxes		(7,711	)		(8,273	)		(21,294	)		(23,663	)
Income tax benefit		13			7			50			16
Net loss	$	(7,698	)	$	(8,266	)	$	(21,244	)	$	(23,647	)
Basic and diluted net loss per common share outstanding	$	(0.08	)	$	(0.12	)	$	(0.21	)	$	(0.44	)
Weighted average common shares used in net loss per share attributable to common stockholders, basic and diluted		99,325,540			68,898,810			98,880,882			53,221,949

Net loss	$	(7,698	)	$	(8,266	)	$	(21,244	)	$	(23,647	)
Other comprehensive loss:
Net unrealized gains (losses) on available-for-sale marketable securities		31			(128	)		(95	)		(263	)
Comprehensive loss	$	(7,667	)	$	(8,394	)	$	(21,339	)	$	(23,910	)

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

Trevi Therapeutics, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(unaudited)

(Amounts in thousands, except share amounts)


					Additional		Accumulated Other						Total
	Common Stock				Paid-		Comprehensive			Accumulated			Stockholders’
	Shares		Amount		in Capital		Loss			Deficit			Equity
Balance at June 30, 2023		63,098,455	$	63	$	318,873	$	(248	)	$	(223,615	)	$	95,073
Stock-based compensation		—		—		530		—			—			530
Issuance of common stock from exercise of stock options		6,875		—		3		—			—			3
Issuance of common stock under the at-the-market sales agreement, net of commissions and allocated fees		750,000		1		1,670		—			—			1,671
Unrealized gains on available-for-sale marketable securities		—		—		—		31			—			31
Net loss		—		—		—		—			(7,698	)		(7,698	)
Balance at September 30, 2023		63,855,330	$	64	$	321,076	$	(217	)	$	(231,313	)	$	89,610

Balance at June 30, 2022		39,719,572	$	40	$	256,908	$	(135	)	$	(196,298	)	$	60,515
Stock-based compensation		—		—		569		—			—			569
Issuance of common stock from exercise of stock options		51,005		—		139		—			—			139
Issuance of common stock and warrants in public offering, less issuance costs		14,252,670		14		51,170		—			—			51,184
Issuance of common stock from warrant exercise		4,299,270		4		5,886		—			—			5,890
Unrealized losses on available-for-sale marketable securities		—		—		—		(128	)		—			(128	)
Net loss		—		—		—		—			(8,266	)		(8,266	)
Balance at September 30, 2022		58,322,517	$	58	$	314,672	$	(263	)	$	(204,564	)	$	109,903



					Additional			Accumulated Other						Total
	Common Stock				Paid-			Comprehensive			Accumulated			Stockholders’
	Shares		Amount		in Capital			Loss			Deficit			Equity
Balance at December 31, 2022		59,943,430	$	60	$	317,590		$	(122	)	$	(210,069	)	$	107,459
Stock-based compensation		—		—		1,713			—			—			1,713
Issuance of common stock from exercise of stock options		143,789		—		73			—			—			73
Issuance of common stock under the at-the-market sales agreement, net of commissions and allocated fees		750,000		1		1,670			—			—			1,671
Issuance of common stock from Employee Stock Purchase Plan		19,273		—		33			—			—			33
Issuance of common stock from pre-funded warrant exercise		2,998,838		3		(3	)		—			—			—
Unrealized losses on available-for-sale marketable securities		—		—		—			(95	)		—			(95	)
Net loss		—		—		—			—			(21,244	)		(21,244	)
Balance at September 30, 2023		63,855,330	$	64	$	321,076		$	(217	)	$	(231,313	)	$	89,610

Balance at December 31, 2021		28,505,804	$	29	$	197,963		$	—		$	(180,917	)	$	17,075
Stock-based compensation		—		—		1,826			—			—			1,826
Issuance of common stock from exercise of stock options		51,005		—		139			—			—			139
Issuance of common stock under the at-the-market sales agreement, net of commissions and allocated fees		—		—		(42	)		—			—			(42	)
Issuance of common stock from Employee Stock Purchase Plan		33,972		—		23			—			—			23
Issuance of common stock and warrants in public offering, less issuance costs		18,833,196		19		102,991			—			—			103,010
Issuance of common stock from warrant exercise		10,898,540		10		11,772			—			—			11,782
Unrealized losses on available-for-sale marketable securities		—		—		—			(263	)		—			(263	)
Net loss		—		—		—			—			(23,647	)		(23,647	)
Balance at September 30, 2022		58,322,517	$	58	$	314,672		$	(263	)	$	(204,564	)		109,903

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

Trevi Therapeutics, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(Amounts in thousands)


	Nine Months Ended September 30,
	2023			2022
Operating activities:
Net loss	$	(21,244	)	$	(23,647	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation		1,713			1,826
Operating lease right-of-use assets		259			100
Accretion/accrual of term loan discounts and debt issuance costs		180			419
Depreciation and amortization		88			28
Loss on disposal of property, equipment and leasehold improvements		10			—
Accretion of available-for-sale marketable securities, net		(1,774	)		(268	)
Change in fair value of term loan derivative liability		—			147
Changes in operating assets and liabilities:
Prepaid expenses and other current assets		(2,935	)		(579	)
Accounts payable		(1,676	)		(527	)
Accrued expenses and other liabilities		28			657
Net cash used in operating activities		(25,351	)		(21,844	)
Investing activities:
Proceeds from maturities of available-for-sale marketable securities		55,679			2,001
Purchases of available-for-sale marketable securities		(8,981	)		(61,025	)
Purchases of property, equipment and leasehold improvements		(115	)		(43	)
Net cash provided by (used in) investing activities		46,583			(59,067	)

Trevi Therapeutics, Inc. [TRVI] Filings
10-Q	[2023-11-09]
10-Q	[2023-08-10]
10-Q	[2023-05-11]
10-K	[2023-03-16]
10-Q	[2022-11-10]
10-Q	[2022-08-11]
10-Q	[2022-05-12]
10-K	[2022-03-17]
10-Q	[2021-11-10]
S-1	[2021-08-27]
10-Q	[2021-08-12]
S-1	[2021-07-07]
10-Q	[2021-05-13]
10-K	[2021-03-25]
10-Q	[2020-11-12]
10-Q	[2020-08-13]
10-Q	[2020-05-07]
10-K	[2020-03-16]
10-Q	[2019-11-14]
10-Q	[2019-08-12]
10-Q	[2019-06-14]
S-1	[2019-04-05]