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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 001-37355

 

VIKING THERAPEUTICS, INC.

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

46-1073877

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification Number)

 

 

 

9920 Pacific Heights Blvd, Suite 350

San Diego, California

 

92121

(Address of Principal Executive Offices)

 

(Zip Code)

 

(858) 704-4660

(Registrant’s telephone number, including area code)

 

 

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

 

 

Title of Each Class

 

Trading Symbol

Name of Each Exchange on Which Registered

Common Stock, par value $0.00001 per share

 

VKTX

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:

 

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  

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

 

Class

 

Number of Shares Outstanding

as of October 15, 2022

Common stock, $0.00001 par value

 

76,688,478

 


 

VIKING THERAPEUTICS, INC.

FORM 10-Q FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2022

TABLE OF CONTENTS

 

 

 

 

Page

 

 

 

 

 

Part I.

 

FINANCIAL INFORMATION

 

1

 

 

 

 

 

Item 1.

 

Consolidated Financial Statements

 

1

 

 

 

 

 

 

 

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

 

1

 

 

 

 

 

 

 

Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2022 and 2021 (unaudited)

 

2

 

 

 

 

 

 

 

Consolidated Statements of Stockholders’ Equity for the three and nine months ended September 30, 2022 and 2021 (unaudited)

 

3

 

 

 

 

 

 

 

Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 and 2021 (unaudited)

 

5

 

 

 

 

 

 

 

Notes to Consolidated Financial Statements (unaudited)

 

6

 

 

 

 

 

Item 2.

 

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

 

21

 

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

28

 

 

 

 

 

Item 4.

 

Controls and Procedures

 

28

 

 

 

 

 

Part II.

 

OTHER INFORMATION

 

29

 

 

 

 

 

Item 1.

 

Legal Proceedings

 

29

 

 

 

 

 

Item 1A.

 

Risk Factors

 

29

 

 

 

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

64

 

 

 

 

 

Item 3.

 

Defaults Upon Senior Securities

 

64

 

 

 

 

 

Item 4.

 

Mine Safety Disclosures

 

64

 

 

 

 

 

Item 5.

 

Other Information

 

64

 

 

 

 

 

Item 6.

 

Exhibits

 

65

 

 

 

 

 

SIGNATURES

 

66

 

 

 


 

PART I. FINANCIAL INFORMATION

 

 

Item 1.

Financial Statements

Viking Therapeutics, Inc.

Consolidated Balance Sheets

 

(In thousands, except share and per share amounts)

 

 

 

September 30,

2022

 

 

December 31,

2021

 

 

 

(Unaudited)

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

29,408

 

 

$

26,371

 

Short-term investments – available for sale

 

 

125,615

 

 

 

175,732

 

Prepaid clinical trial and preclinical study costs

 

 

9,167

 

 

 

7,806

 

Prepaid expenses and other current assets

 

 

956

 

 

 

619

 

Total current assets

 

 

165,146

 

 

 

210,528

 

Right-of-use assets

 

 

1,489

 

 

 

25

 

Deferred financing costs

 

 

15

 

 

 

76

 

Deposits

 

 

33

 

 

 

33

 

Total assets

 

$

166,683

 

 

$

210,662

 

Liabilities and stockholders’ equity

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

3,142

 

 

$

1,444

 

Other accrued liabilities

 

 

10,620

 

 

 

7,305

 

Lease liability, current

 

 

299

 

 

 

29

 

Total current liabilities

 

 

14,061

 

 

 

8,778

 

Lease liability, net of current portion

 

 

1,337

 

 

 

 

Total long-term liabilities

 

 

1,337

 

 

 

 

Total liabilities

 

 

15,398

 

 

 

8,778

 

Commitments and contingencies (Note 8)

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

Preferred stock, $0.00001 par value: 10,000,000 shares authorized at September 30, 2022 and December 31, 2021; no shares issued and outstanding at September 30, 2022 and December 31, 2021

 

 

 

 

 

 

Common stock, $0.00001 par value: 300,000,000 shares authorized at September 30, 2022 and December 31, 2021; 76,688,478 and 78,248,401 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively

 

 

1

 

 

 

1

 

Additional paid-in capital

 

 

432,330

 

 

 

425,614

 

Accumulated deficit

 

 

(272,490

)

 

 

(223,182

)

Accumulated other comprehensive loss

 

 

(1,761

)

 

 

(549

)

Treasury stock at cost, 2,193,251 shares at September 30, 2022, no shares at December 31, 2021

 

 

(6,795

)

 

 

 

Total stockholders’ equity

 

 

151,285

 

 

 

201,884

 

Total liabilities and stockholders’ equity

 

$

166,683

 

 

$

210,662

 

See accompanying notes to the unaudited consolidated financial statements.

1


Viking Therapeutics, Inc.

Consolidated Statements of Operations and Comprehensive Loss

 

(In thousands, except per share amounts)

(Unaudited)

 

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenues

 

$

 

 

$

 

 

$

 

 

$

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

11,959

 

 

 

10,795

 

 

 

38,056

 

 

 

35,134

 

General and administrative

 

 

4,237

 

 

 

2,608

 

 

 

12,016

 

 

 

8,038

 

Total operating expenses

 

 

16,196

 

 

 

13,403

 

 

 

50,072

 

 

 

43,172

 

Loss from operations

 

 

(16,196

)

 

 

(13,403

)

 

 

(50,072

)

 

 

(43,172

)

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of financing costs

 

 

(27

)

 

 

35

 

 

 

(51

)

 

 

(6

)

Interest income, net

 

 

450

 

 

 

125

 

 

 

857

 

 

 

544

 

Realized loss on investments, net

 

 

 

 

 

 

 

 

(42

)

 

 

 

Total other income, net

 

 

423

 

 

 

160

 

 

 

764

 

 

 

538

 

Net loss

 

 

(15,773

)

 

 

(13,243

)

 

 

(49,308

)

 

 

(42,634

)

Other comprehensive loss, net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain (loss) on securities

 

 

111

 

 

 

19

 

 

 

(813

)

 

 

(116

)

Foreign currency translation loss

 

 

(223

)

 

 

 

 

 

(399

)

 

 

 

Comprehensive loss

 

$

(15,885

)

 

$

(13,224

)

 

$

(50,520

)

 

$

(42,750

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net loss per common share

 

$

(0.21

)

 

$

(0.17

)

 

$

(0.64

)

 

$

(0.55

)

Weighted-average shares used to compute basic and diluted net loss per share

 

 

76,505

 

 

 

78,009

 

 

 

76,917

 

 

 

76,908

 

See accompanying notes to the unaudited consolidated financial statements.

 

2


 

Viking Therapeutics, Inc.

Consolidated Statements of Stockholders’ Equity

 

(In thousands, except share amounts)

(Unaudited)

 

 

 

Three-Month Period Ended September 30, 2022

 

 

 

Common Stock

 

 

Additional

Paid-In

 

 

Accumulated

 

 

Accumulated Other

Comprehensive

 

 

Treasury Stock

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Loss

 

 

Amount

 

 

Total

 

Balance at June 30, 2022

 

 

76,688,478

 

 

$

1

 

 

$

430,390

 

 

$

(256,717

)

 

$

(1,649

)

 

$

(6,795

)

 

$

165,230

 

Employee stock-based compensation

 

 

 

 

 

 

 

 

1,940

 

 

 

 

 

 

 

 

 

 

 

 

1,940

 

Issuance of common stock under employee stock plans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Repurchase of common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain on investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

111

 

 

 

 

 

 

111

 

Unrealized currency translation gains

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(223

)

 

 

 

 

 

(223

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

(15,773

)

 

 

 

 

 

 

 

 

(15,773

)

Balance at September 30, 2022

 

 

76,688,478

 

 

$

1

 

 

$

432,330

 

 

$

(272,490

)

 

$

(1,761

)

 

$

(6,795

)

 

$

151,285

 

 

 

 

Nine-Month Period Ended September 30, 2022

 

 

 

Common Stock

 

 

Additional

Paid-In

 

 

Accumulated

 

 

Accumulated Other

Comprehensive

 

 

Treasury Stock

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Income (Loss)

 

 

Amount

 

 

Total

 

Balance at December 31, 2021

 

 

78,248,401

 

 

$

1

 

 

$

425,614

 

 

$

(223,182

)

 

$

(549

)

 

$

 

 

$

201,884

 

Employee stock-based compensation

 

 

 

 

 

 

 

 

6,517

 

 

 

 

 

 

 

 

 

 

 

 

6,517

 

Shares withheld related to employee tax withholding

 

 

(105,475

)

 

 

 

 

 

(499

)

 

 

 

 

 

 

 

 

 

 

 

(499

)

Issuance of common stock under employee stock plans

 

 

266,303

 

 

 

 

 

 

84

 

 

 

 

 

 

 

 

 

 

 

 

84

 

Issuance of common stock from warrant exercises

 

 

472,500

 

 

 

 

 

 

614

 

 

 

 

 

 

 

 

 

 

 

 

614

 

Repurchase of common stock

 

 

(2,193,251

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(6,795

)

 

 

(6,795

)

Unrealized loss on investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(813

)

 

 

 

 

 

(813

)

Unrealized currency translation gains

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(399

)

 

 

 

 

 

(399

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

(49,308

)

 

 

 

 

 

 

 

 

(49,308

)

Balance at September 30, 2022

 

 

76,688,478

 

 

$

1

 

 

$

432,330

 

 

$

(272,490

)

 

$

(1,761

)

 

$

(6,795

)

 

$

151,285

 

 

See accompanying notes to the unaudited consolidated financial statements.

3


Viking Therapeutics, Inc.

Consolidated Statements of Stockholders’ Equity

 

(In thousands, except share amounts)

(Unaudited)

 

 

 

 

Three-Month Period Ended September 30, 2021

 

 

 

Common Stock

 

 

Additional

Paid-In

 

 

Accumulated

 

 

Accumulated Other

Comprehensive

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Loss

 

 

Total

 

Balance at June 30, 2021

 

 

78,189,814

 

 

$

1

 

 

$

422,745

 

 

$

(197,583

)

 

$

(189

)

 

$

224,974

 

Employee stock-based compensation

 

 

 

 

 

 

 

 

1,599

 

 

 

 

 

 

 

 

 

1,599

 

Shares withheld related to employee tax withholding

 

 

(36,009

)

 

 

 

 

 

(234

)

 

 

 

 

 

 

 

 

(234

)

Issuance of common stock under employee stock plans

 

 

81,084

 

 

 

 

 

 

6

 

 

 

 

 

 

 

 

 

6

 

Unrealized gain on investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

19

 

 

 

19

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(13,243

)

 

 

 

 

 

(13,243

)

Balance at September 30, 2021

 

 

78,234,889

 

 

$

1

 

 

$

424,116

 

 

$

(210,826

)

 

$

(170

)

 

$

213,121

 

 

 

 

Nine-Month Period Ended September 30, 2021

 

 

 

Common Stock

 

 

Additional

Paid-In

 

 

Accumulated

 

 

Accumulated Other

Comprehensive

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Income

 

 

Total

 

Balance at December 31, 2020

 

 

73,215,940

 

 

$

1

 

 

$

412,589

 

 

$

(168,192

)

 

$

(54

)

 

$

244,344

 

Employee stock-based compensation

 

 

 

 

 

 

 

 

4,667

 

 

 

 

 

 

 

 

 

4,667

 

Shares withheld related to employee tax withholding

 

 

(117,025

)

 

 

 

 

 

(707

)

 

 

 

 

 

 

 

 

(707

)

Issuance of common stock under employee stock plans

 

 

407,662

 

 

 

 

 

 

504

 

 

 

 

 

 

 

 

 

504

 

Issuance of common stock from warrant exercises

 

 

4,728,312

 

 

 

 

 

 

7,063

 

 

 

 

 

 

 

 

 

7,063

 

Unrealized loss on investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(116

)

 

 

(116

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

(42,634

)

 

 

 

 

 

(42,634

)

Balance at September 30, 2021

 

 

78,234,889

 

 

$

1

 

 

$

424,116

 

 

$

(210,826

)

 

$

(170

)

 

$

213,121

 

 

See accompanying notes to the unaudited consolidated financial statements.

4


Viking Therapeutics, Inc.

Consolidated Statements of Cash Flows

 

(In thousands)

(Unaudited)

 

 

 

Nine Months Ended September 30,

 

 

2022

 

 

2021

 

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

Net loss

 

$

(49,308

)

 

$

(42,634

)

 

Adjustments to reconcile net loss to net cash used in operating

   activities

 

 

 

 

 

 

 

 

 

Amortization of investment premiums, net

 

 

1,270

 

 

 

3,151

 

 

Amortization of financing costs

 

 

51

 

 

 

6

 

 

Stock-based compensation

 

 

6,517

 

 

 

4,667

 

 

Amortization of right-of-use assets

 

 

219

 

 

 

220

 

 

Realized loss on investment

 

 

42

 

 

 

 

 

Interest expense related to operating lease liability

 

 

29

 

 

 

11

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

 

Prepaid expenses and other current assets

 

 

(1,698

)

 

 

(404

)

 

Accrued interest, net of interest received on maturity of investments

 

 

499

 

 

 

582

 

 

Accounts payable

 

 

1,698

 

 

 

(1,154

)

 

Other accrued liabilities

 

 

3,315