Reneo Pharmaceuticals, Inc. (Nasdaq: RPHM), a clinical-stage pharmaceutical company focused on the development and commercialization of therapies for patients with rare genetic mitochondrial diseases, today reported financial results for the quarter ended June 30, 2022.
“The second quarter was a very productive period for the company, highlighted by advancements in both of our mitochondrial disease programs,” said Gregory J. Flesher, President and CEO of Reneo Pharmaceuticals. “We recently reported positive results from the REN001 long-chain fatty acid oxidation disorders study, and look forward to meeting with regulators to discuss next steps for this program. In addition, we continued to make good progress with our primary mitochondrial myopathies program, including achievement of two-thirds enrollment in the pivotal STRIDE study, gaining alignment on the planned registration plan in Europe, and announcing plans to begin a third development program in patients with nuclear DNA defects.”
Second Quarter and Recent Highlights
Anticipated Milestones
Financial Results for the Three Months Ended June 30, 2022
The Company reported a net loss of $12.3 million, or $0.50 per share, for the three months ended June 30, 2022, compared to a net loss of $9.2 million, or $0.43 per share, for the three months ended June 30, 2021. The Company had approximately $127 million in cash, cash equivalents and short-term investments as of June 30, 2022.
Research and development expenses for the three months ended June 30, 2022 were $8.1 million, compared to $6.3 million for the three months ended June 30, 2021. This increase of $1.8 million was primarily due to a $1.1 million increase in personnel-related costs due to the additional headcount required to support our clinical and manufacturing operations. In addition, there was a $0.4 million increase in clinical trial and manufacturing costs and a $0.4 million increase in non-clinical activities.
General and administrative expenses for the three months ended June 30, 2022 were $4.3 million, compared to $2.9 million during the three months ended June 30, 2021. This increase of $1.4 million was primarily attributable to increased costs to operate as a public company, including increases in outside professional services of $1.1 million and personnel-related expenses of $0.1 million.
Corporate Access Events
About Reneo Pharmaceuticals
Reneo is a clinical-stage pharmaceutical company focused on the development and commercialization of therapies for patients with rare genetic mitochondrial diseases, which are often associated with the inability of mitochondria to produce adenosine triphosphate (ATP). Our lead product candidate, REN001, is a potent and selective agonist of the peroxisome proliferator-activated receptor delta (PPARδ). REN001 has been shown to increase transcription of genes involved in mitochondrial function and increase fatty acid oxidation, and may increase production of new mitochondria. For additional information, please see reneopharma.com.
About REN001
REN001 is a potent and selective peroxisome proliferator-activated receptor delta (PPARδ) agonist currently in clinical development for two rare genetic mitochondrial diseases that typically present with myopathy and have high unmet medical needs: PMM and LC-FAOD. For additional information, please see clinicaltrials.gov.
About PMM
PMM are a group of disorders caused by genetic mutations within the mitochondrial DNA or nDNA that affect the activity of enzymes or other proteins in the mitochondria. In PMM these genetic alterations hamper the ability of mitochondria to generate energy from nutrient sources, resulting in energy deficits that are most pronounced in tissues with high energy demand such as muscle, brain, and heart. The symptoms of PMM include muscle weakness or exercise intolerance, movement disorder, deafness, blindness, and droopy eyelids among others. The prognosis for these disorders ranges in severity from progressive weakness to death.
About LC-FAOD
LC-FAOD are a group of rare genetic metabolic disorders caused by mutations or deletions in the nDNA. These genetic alterations prevent the body from breaking down long-chain fatty acids during metabolism. The most severe cases of LC-FAOD are diagnosed within the first few days or weeks of life. Young patients often present with a severe energy deficit that results in lethargy, liver dysfunction, hypoglycemia, encephalopathy, and high risk for sudden death. Older patients usually present with muscle weakness, exercise intolerance, muscle aches, or rhabdomyolysis which can damage the heart and kidneys and cause permanent disability or even death.
Forward-Looking Statements
Statements contained in this press release regarding matters that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements regarding, among other things, the potential development and commercialization of REN001, results, conduct, progress, plans and timing of Reneo’s clinical studies, including the planned registration plan in Europe, presentation of data from clinical trials, meetings with regulatory agencies and the regulatory approval path for REN001. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Words such as “plans,” “will,” “believes,” “anticipates,” “expects,” “intends,” “goal,” “potential” and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based upon Reneo’s current expectations and involve assumptions that may never materialize or may prove to be incorrect. Actual results could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties, which include, without limitation, risks and uncertainties associated with Reneo’s business in general, and the other risks described in Reneo’s filings with the Securities and Exchange Commission. All forward-looking statements contained in this press release speak only as of the date on which they were made. Reneo undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.
RENEO PHARMACEUTICALS, INC.
Consolidated Balance Sheets
(In thousands, except share and par value data)
| June 30, 2022 | December 31, 2021 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 118,264 | $ | 124,660 | ||||
| Short-term investments | 8,588 | 23,010 | ||||||
| Prepaid expenses and other current assets | 5,159 | 6,064 | ||||||
| Total current assets | 132,011 | 153,734 | ||||||
| Property and equipment, net | 236 | 212 | ||||||
| Right-of-use assets | 1,283 | — | ||||||
| Other non-current assets | 78 | 78 | ||||||
| Total assets | $ | 133,608 | $ | 154,024 | ||||
| Liabilities and stockholders’ equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,560 | $ | 2,022 | ||||
| Accrued expenses | 6,367 | 4,180 | ||||||
| Operating lease liabilities, current portion | 408 | — | ||||||
| Total current liabilities | 8,335 | 6,202 | ||||||
| Operating lease liabilities, less current portion | 1,061 | — | ||||||
| Other long-term liabilities | — | 167 | ||||||
| Performance award | 55 | 444 | ||||||
| Total liabilities | 9,451 | 6,813 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Common stock, $0.0001 par value; 200,000,000 shares authorized at June 30, 2022 and December 31, 2021; 24,479,646 shares issued and outstanding at June 30, 2022; and 24,457,838 and 24,455,390 shares issued and outstanding at December 31, 2021, respectively | 3 | 3 | ||||||
| Additional paid-in capital | 234,062 | 231,902 | ||||||
| Accumulated deficit | (110,076 | ) | (84,728 | ) | ||||
| Accumulated other comprehensive income | 168 | 34 | ||||||
| Total stockholders’ equity | 124,157 | 147,211 | ||||||
| Total liabilities and stockholders’ equity | $ | 133,608 | $ | 154,024 | ||||
RENEO PHARMACEUTICALS, INC.
Consolidated Statements of Operations and Comprehensive Loss
(In thousands, except share and per share data)
(Unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | $ | 8,132 | $ | 6,279 | $ | 17,410 | $ | 11,751 | ||||||||
| General and administrative | 4,299 | 2,949 | 8,036 | 4,691 | ||||||||||||
| Total operating expenses | 12,431 | 9,228 | 25,446 | 16,442 | ||||||||||||
| Loss from operations | (12,431 | ) | (9,228 | ) | (25,446 | ) | (16,442 | ) | ||||||||
| Other income | 119 | 12 | 98 | 14 | ||||||||||||
| Net loss | (12,312 | ) | (9,216 | ) | (25,348 | ) | (16,428 | ) | ||||||||
| Unrealized gain on short-term investments | 104 | 5 | 134 | 5 | ||||||||||||
| Comprehensive loss | $ | (12,208 | ) | $ | (9,211 | ) | $ | (25,214 | ) | $ | (16,423 | ) | ||||
| Net loss per share attributable to common stockholders, basic and diluted | $ | (0.50 | ) | $ | (0.43 | ) | $ | (1.04 | ) | $ | (1.40 | ) | ||||
| Weighted-average shares used in computing net loss per share, basic and diluted | 24,463,824 | 21,364,369 | 24,461,085 | 11,770,948 | ||||||||||||
RENEO PHARMACEUTICALS, INC.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
| Six Months Ended June 30, | ||||||||
| 2022 | 2021 | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | (25,348 | ) | $ | (16,428 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Stock-based compensation | 2,113 | 1,325 | ||||||
| Depreciation and amortization | 41 | 20 | ||||||
| Amortization/accretion on short-term investments | (22 | ) | 33 | |||||
| Changes in the fair value of performance award | (389 | ) | 363 | |||||
| Non-cash lease expense | 241 | — | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Prepaid expenses and other assets | 905 | (2,457 | ) | |||||
| Accounts payable and accrued expenses | 1,726 | (1,164 | ) | |||||
| Operating lease liabilities | (222 | ) | — | |||||
| Other current and long-term liabilities | — | 18 | ||||||
| Net cash used in operating activities | (20,955 | ) | (18,290 | ) | ||||
| Cash flows from investing activities | ||||||||
| Purchases of property and equipment | (68 | ) | (31 | ) | ||||
| Purchase of available-for-sale short-term investments | (15,922 | ) | (26,989 | ) | ||||
| Proceeds from maturities of available-for-sale short-term investments | 30,500 | — | ||||||
| Net cash provided by (used in) investing activities | 14,510 | (27,020 | ) | |||||
| Cash flows from financing activities | ||||||||
| Proceeds from issuance of Series B convertible preferred stock, net of issuance costs | — | 47,239 | ||||||
| Proceeds from initial public offering, net of offering costs | — | 84,639 | ||||||
| Proceeds from issuance of common stock in connection with equity plans | 49 | 187 | ||||||
| Net cash provided by financing activities | 49 | 132,065 | ||||||
| Net (decrease) increase in cash and cash equivalents | (6,396 | ) | 86,755 | |||||
| Cash and cash equivalents, beginning of period | 124,660 | 53,613 | ||||||
| Cash and cash equivalents, end of period | $ | 118,264 | $ | 140,368 | ||||
| Noncash operating activities: | ||||||||
| Right-of-use assets obtained in exchange for lease obligations | $ | 1,524 | $ | — | ||||
| Noncash investing and financing activities: | ||||||||
| Property and equipment in accounts payable | $ | — | $ | 10 | ||||
| Accrued deferred initial public offering costs | $ | — | $ | 30 | ||||
Contacts:
Joyce Allaire
Managing Director
LifeSci Advisors, LLC
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Danielle Spangler
Investor Relations
Reneo Pharmaceuticals, Inc.
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| Last Trade: | US$16.60 |
| Daily Volume: | 56,405 |
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