The following discussion should be read in conjunction with our condensed
financial statements and accompanying footnotes appearing elsewhere in this
Quarterly Report on Form 10-Q and our audited financial statements and related
footnotes included in our Annual Report on Form 10-K for the year ended
Some of the information contained in this discussion and analysis or set forth
elsewhere in this Quarterly Report on Form 10-Q, including information with
respect to our plans and strategy for our business, includes forward-looking
statements that involve risks and uncertainties. See "Special Note Regarding
Forward-Looking Statements." Because of many factors, including those factors
set forth in the "Risk Factors" section of our Annual Report, and Form 10-Q for
the quarter ended
Overview
We are a clinical-stage biopharmaceutical company focused on the discovery, development, and commercialization of novel, proprietary, synthetic small molecules for the treatment of nervous system disorders. We focus our efforts on targeting and modulating N-methyl-D-aspartate receptors, or NMDArs, which are vital to normal and effective function of the brain and nervous system. We believe leveraging the therapeutic advantages of the differentiated modulatory mechanism of our compounds will drive a paradigm shift in the treatment of disorders of the brain and nervous system. We are advancing a pipeline of distinct product candidates derived from our NMDAr modulator discovery platform, or the discovery platform. The following table summarizes the current status of our development programs as of the date of this quarterly report.
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NYX-783 is in Phase 2b clinical development for the treatment of post-traumatic
stress disorder, or PTSD. We are currently enrolling a Phase 2b study evaluating
the efficacy and safety of a 50 mg dose of NYX-783 in approximately 300 patients
with PTSD. In
NYX-458 is in clinical development for the treatment of cognitive impairment
associated with neurodegenerative conditions. On
NYX-2925 is our product candidate previously in clinical development for the
treatment of fibromyalgia. On
The COVID-19 pandemic has and could further adversely impact our clinical and/or preclinical studies, as well as our business operations. We continue to evaluate the impact of the COVID-19 pandemic on patients and our employees, as well as our operations and the operations of our business partners and healthcare communities. In response to the COVID-19 pandemic, we have implemented policies to mitigate the risk of exposure to COVID-19 by our personnel, including a work-from-home policy applicable to the majority of our personnel and a phased approach to bringing personnel back to our locations over time. However, the ultimate impact of the COVID-19 pandemic on our business operations is highly uncertain and subject to change and will depend on future developments which are difficult to predict.
Since our inception in
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conclusion of our research collaboration with Allergan in
From our inception through
We believe that our available funds will be sufficient to fund our operations for at least the next twelve months. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect. We do not expect to generate revenue from product sales unless and until we successfully complete clinical development and obtain regulatory approval for a product candidate, which we expect will take a number of years and the outcome of which is uncertain, or enter into collaborative agreements with third parties, the timing of which is largely beyond our control and may never occur. To fund our current and future operating plans, we will need additional capital, which we may obtain through one or more equity offerings, debt financings, or other third-party funding, including potential strategic alliances and licensing or collaboration arrangements. We may, however, be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all, including as a result of COVID-19. Our failure to raise capital or enter into such other arrangements as and when needed would have a negative impact on our financial condition and our ability to develop our current product candidates, or any additional product candidates, if developed. The amount and timing of our future funding requirements will depend on many factors, including the impacts of COVID-19, our ability to timely and successfully enroll subjects in our clinical studies, and the pace and results of our preclinical and clinical development efforts. We cannot assure you that we will ever be profitable or generate positive cash flow from operating activities.
Financial operations overview
Revenues
We have not generated any revenue from product sales. We are unable to predict
when, if ever, material net cash inflows will commence from sales of our
products, if approved. Our revenue to date has been primarily derived from a
research collaboration agreement with Allergan (now a subsidiary of AbbVie),
under which the jointly funded research activities and option exercise period,
including the associated payments by Allergan, came to their contractual
conclusion in
Operating expenses
Research and development expenses
Research and development activities account for a significant portion of our operating expenses. We expense research and development costs as incurred. Research and development expenses consist of costs incurred in connection with the development of our product candidates, including:
fees paid to consultants, sponsored researchers, contract manufacturing
organizations, or CMOs, and contract research organizations, or CROs, including
? in connection with our preclinical and clinical studies, and other related
clinical study fees, such as for investigator grants, patient screening,
laboratory work, clinical study database management, and statistical
compilation and analysis;
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? costs related to acquiring and maintaining preclinical and clinical study
materials and facilities;
? costs related to compliance with regulatory requirements; and
? costs related to salaries, bonuses, and other compensation, including
stock-based compensation, for employees in research and development functions.
At this time, we cannot reasonably estimate or know the nature, timing, and costs of the efforts that will be necessary to complete the development of our product candidates. This is due to the numerous risks and uncertainties associated with developing such product candidates, including the uncertainty related to:
? the impacts of COVID-19 and future health epidemics;
? future clinical study results;
the scope, rate of progress, and expense of our ongoing as well as any
? additional preclinical studies, clinical studies and other research and
development activities;
? clinical study enrollment rate or design;
? the manufacturing of our product candidates;
? our ability to obtain and maintain intellectual property protection for our
product candidates;
our ability to obtain funding for our operations, including funding necessary
? to complete further development and commercialization of our product
candidates;
? significant and changing government regulation;
establishing commercial manufacturing capabilities or making arrangements with
? third-party manufacturers, developing and timely delivery of commercial-grade
drug formulations that can be used in our clinical trials and for commercial
launch;
? the timing and receipt of regulatory approvals, if any; and
? the risks disclosed in the section entitled "Risk Factors" of our Annual
Report, and Form 10-Q for the quarter ended
A change in the outcome of any of these variables with respect to the development of any of our product candidates could significantly change the costs, timing, and viability associated with the development of that product candidate.
We expect our research and development expenses to increase over the next several years as we continue to implement our business strategy, which includes advancing our product candidates into and through clinical development, expanding our research and development efforts, seeking regulatory approvals for any product candidates for which we successfully complete clinical studies, accessing and developing additional product candidates, and hiring additional personnel to support our research and development efforts. In addition, product candidates in later stages of clinical development generally incur higher development costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical studies. As such, we expect our research and development expenses to increase as our product candidates advance into later stages of clinical development.
General and administrative expenses
General and administrative expenses consist primarily of salaries and related costs, including stock-based compensation. General and administrative expenses also include rent as well as professional fees for legal, consulting, accounting, and audit services.
In the future, we expect that our general and administrative expenses will increase as we continue to support our research and development and the potential commercialization of our product candidates, if approved.
Other (income) expense, net, and interest expense
Other (income) expense, net and interest expense consists primarily of the interest income earned on our cash and cash equivalents and interest expense on our Loan Agreement, and includes changes in fair value of the derivative liability associated with our obligation to issue additional warrants in connection with subsequent draws under our Loan Agreement.
22 Table of Contents Results of operations
Comparison of the three months ended
The following table summarizes our results of operations for the three months
ended
Three months ended September 30, Increase 2022 2021 (Decrease) Operating expenses: Research and development$ 10,008 $ 16,278 $ (6,270) General and administrative 4,649 4,928 (279) Total operating expenses 14,657 21,206 (6,549) Loss from operations (14,657) (21,206) (6,549) Other (income) expense, net (208) (47) (161) Interest expense 854 72 782
Net loss and comprehensive loss
Research and development expenses
The following table summarizes our research and development expenses incurred
during the three months ended
Three months ended September 30, Increase 2022 2021 (Decrease) NYX-2925$ 2,674 $ 8,946 $ (6,272) NYX-783 2,815 1,524 1,291 NYX-458 2,271 2,493 (222) Preclinical research and discovery programs 547 815 (268) Personnel and related costs 1,701 2,500 (799)
Total research and development expenses
Research and development expenses were
a decrease of approximately
? enrollment in our Phase 2b clinical studies of NYX-2925 in patients with
painful DPN and in patients with fibromyalgia in
2022, respectively;
a decrease of approximately
? related support costs associated with reduction in headcount and lower grant
date fair market values for equity awards;
a decrease of approximately
? enrollment in our Phase 2 study of NYX-458 in patients with cognitive
impairment associated with Parkinson's disease and dementia with Lewy bodies;
offset in part by
an increase of approximately
? product costs related to the conduct of Phase 2b development of NYX-783 in
patients with PTSD.
General and administrative expense
General and administrative expenses were
23 Table of Contents Other (income) expense, net
We recorded
Interest expense
Interest expense was
Comparison of the nine months ended
The following table summarizes our results of operations for the nine months
ended
Nine months ended September 30, Increase 2022 2021 (Decrease) Collaboration revenue $ -$ 1,000 $ (1,000) Operating expenses: Research and development 35,519 41,388 (5,869) General and administrative 15,622 14,974 648 Total operating expenses 51,141 56,362 (5,221) Loss from operations (51,141) (55,362) (4,221) Other (income) expense, net (432) (158) (274) Interest expense 2,088 72 2,016
Net loss and comprehensive loss
Collaboration revenue
Collaboration revenue was
Research and development expenses
The following table summarizes our research and development expenses incurred
during the nine months ended
Nine months ended September 30, Increase 2022 2021 (Decrease) NYX-2925$ 9,560 $ 24,973 $ (15,413) NYX-783 11,520 2,692 8,828 NYX-458 5,654 4,181 1,473 Preclinical research and discovery programs 2,555 2,158 397 Personnel and related costs 6,230 7,384 (1,154)
Total research and development expenses
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Research and development expenses were
a decrease of approximately
? enrollment in our Phase 2b clinical studies of NYX-2925 in patients with
painful DPN and in patients with fibromyalgia in
2022, respectively;
a decrease of approximately
? related support costs associated with reduction in headcount and lower grant
date fair market values for equity awards; offset by
an increase of approximately
? product costs related to Phase 2b development of NYX-783 in patients with PTSD;
and
an increase of approximately
study of NYX-458 in patients with cognitive impairment associated with
? Parkinson's disease and dementia with Lewy bodies, which had been temporarily
suspended from
COVID-19 pandemic.
General and administrative expenses
General and administrative expenses were
Other (income) expense, net
We recorded
Interest expense
Interest expense was
Liquidity and capital resources
From our inception through
On
On
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As of
Funding requirements
Our primary uses of capital are, and we expect will continue to be, research and development activities, compensation and related expenses, product manufacturing, laboratory and related supplies, legal, and other regulatory expenses, patent prosecution filing and maintenance costs for our licensed intellectual property, and general overhead costs. We expect to continue incurring significant expenses and operating losses for the foreseeable future. In addition, since the closing of our IPO, we have incurred, and expect to continue to incur, costs associated with operating as a public company. We anticipate that our expenses will increase in connection with our ongoing activities as we:
? seek to address and recover from impacts of the COVID-19 pandemic, including
delays to our product development timelines;
? advance the clinical development of our lead product candidates;
? continue to improve the manufacturing process for our product candidates and
manufacture clinical supplies as our development progresses;
? continue the research and development of our preclinical product candidates;
? seek to identify and develop additional product candidates;
? maintain, expand, and protect our intellectual property portfolio; and
? improve our operational, financial, and management systems to support our
clinical development and other operations.
Outlook
Based on our research and development plans and our timing expectations related
to the progress of our programs, we expect that our cash and cash equivalents as
of
We do not expect to generate revenue from product sales unless and until we successfully complete clinical development and obtain regulatory approval for a product candidate, which we expect will take a number of years and the outcome of which is uncertain, or enter into collaborative agreements with third parties, the timing of which is largely beyond our control and may never occur. We will continue to require additional capital to develop our product candidates and fund operations for the foreseeable future, which we may obtain through one or more equity offerings, debt financings, or other third-party funding, including potential strategic alliances and licensing or collaboration arrangements. We may, however, be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all, including as a result of the COVID-19 pandemic. Our failure to raise capital or enter into such other arrangements as and when needed would have a negative impact on our financial condition and our ability to develop our current product candidates, or any additional product candidates, if developed. The amount and timing of our future funding requirements will depend on many factors, including the effects of the COVID-19 pandemic, our ability to timely and
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successfully enroll subjects in our clinical studies and the pace and results of our preclinical and clinical development efforts. We cannot assure you that we will ever be profitable or generate positive cash flow from operating activities.
Cash flows
The following table summarizes our sources and uses of cash for each of the
three months ended
Nine months ended September 30, 2022 2021 Net cash provided by (used in): Operating activities$ (49,307) $ (44,365) Investing activities - 122 Financing activities 9,749 28,431
Net decrease in cash, cash equivalents and restricted cash
Operating activities
For the nine months ended
Investing activities
For the nine months ended
Financing activities
For the nine months ended
Critical accounting policies and significant judgments and estimates
This discussion and analysis of our financial condition and results of
operations is based on our financial statements, which we have prepared in
accordance with
Recent accounting pronouncements
See Note 2 to our condensed financial statements included elsewhere in this Quarterly Report on Form 10-Q.
27 Table of Contents JOBS Act accounting election
Under Section 107(b) of the Jumpstart Our Business Startups Act of 2012, as
amended, or the JOBS Act, an "emerging growth company" can delay the adoption of
new or revised accounting standards until such time as those standards would
apply to private companies. We intend to rely on this exemption. There are other
exemptions and reduced reporting requirements provided by the JOBS Act that we
are currently evaluating. For example, as an "emerging growth company," we are
exempt from Sections 14A(a) and (b) of the Securities Exchange Act of 1934, as
amended, or the Exchange Act, which would otherwise require us to (1) submit
certain executive compensation matters to shareholder advisory votes, such as
"say-on-pay," "say-on-frequency," and "golden parachutes;" and (2) disclose
certain executive compensation related items such as the correlation between
executive compensation and performance and comparisons of our chief executive
officer's compensation to our median employee compensation. We also intend to
rely on an exemption from the rule requiring us to provide an auditor's
attestation report on our internal controls over financial reporting pursuant to
Section 404(b) of the Sarbanes-Oxley Act of 2002. We will continue to remain an
"emerging growth company" until the earliest of the following: (1)
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