cogt-10q_20210331.htm

10-Q 1 cogt-10q_20210331.htm 10-Q cogt-10q_20210331.htm

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 March 31, 2021

☐	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: 001-38443

Cogent Biosciences, Inc.

(Exact name of registrant as specified in its charter)

Delaware

46-5308248

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

200 Cambridge Park Drive, Suite 2500

Cambridge, Massachusetts

02140

(Address of principal executive offices)

(Zip code)

(617) 945-5576

(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

COGT

The Nasdaq Global Select Market

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 ☒

As of May 8, 2021, there were 38,410,267 shares of the registrant’s Common Stock, $0.001 par value per share, outstanding.

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements, which reflect our current views with respect to, among other things, our operations and financial performance. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans, objectives of management and expected market growth are forward-looking statements. These statements involve known and unknown risks, uncertainties, and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements.

In some cases, you can identify forward-looking statements by terms such as “may,” “should,” “expects,” “might,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” “seek,” “would” or “continue,” or the negative of these terms or other similar expressions. The forward looking statements in this Quarterly Report on Form 10-Q are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Although we believe that the expectations reflected in the forward-looking statements are reasonable, 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. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q and are subject to a number of risks, uncertainties and assumptions described in Item 1A. “Risk Factors” in our most recent Annual Report on Form 10-K. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. Some of the key factors that could cause actual results to differ from our expectations include:

•

the potential impacts of raising additional capital, including dilution to our existing stockholders, restrictions on our operations or requirements that we relinquish rights to our technologies or product candidates;

•

business interruptions resulting from the coronavirus disease (“COVID-19”) outbreak or similar public health crises, which could cause a disruption of the development of our product candidates and adversely impact our business;

•

the success, cost, and timing of our product development activities and clinical trials;

•

the timing of our planned regulatory submissions to the FDA for our product candidate CGT9486;

•

our ability to obtain and maintain regulatory approval for our CGT9486 product candidate and any other product candidates we may develop, and any related restrictions, limitations, and/or warnings in the label of an approved product candidate;

•

the potential for our identified research priorities to advance our CGT9486 product candidate;

•

the ability to license additional intellectual property relating to our product candidates from third-parties and to comply with our existing or future license agreements and/or collaboration agreements;

•

the ability and willingness of our third-party research institution collaborators to continue research and development activities relating to our product candidates;

•

our ability to commercialize our products in light of the intellectual property rights of others;

•

our ability to obtain funding for our operations, including funding necessary to complete further development and commercialization of our product candidates;

•

the scalability and commercial viability of our manufacturing methods and processes;

•

the commercialization of our product candidates, if approved;

•

our plans to research, develop, and commercialize our product candidates;

•

our ability to attract collaborators with development, regulatory, and commercialization expertise;

•

future agreements with third parties in connection with the commercialization of our product candidates and any other approved product;

•

the size and growth potential of the markets for our product candidates, and our ability to serve those markets;

•

the rate and degree of market acceptance of our product candidates;

•

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

•

regulatory developments in the United States and foreign countries;

•

our ability to contract with third-party suppliers and manufacturers and their ability to perform adequately;

•

the success of competing therapies that are or may become available;

•

our ability to attract and retain key scientific or management personnel;

•

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

•

our expectations regarding the period during which we qualify as an emerging growth company under the JOBS Act;

•

our use of the proceeds from the private placements, sales of our preferred stock and public offerings of our common stock, including the December 2020 underwritten offering, as described herein; and

•

our expectations regarding our ability to obtain and maintain intellectual property protection for our product candidates.

While we may elect to update these forward-looking statements at some point in the future, whether as a result of any new information, future events, or otherwise, we have no current intention of doing so except to the extent required by applicable law.

Cogent Biosciences, Inc.

Table of Contents

		Page
	PART I—FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss	2
	Condensed Consolidated Statements of Stockholders’ Equity	3
	Condensed Consolidated Statements of Cash Flows	4
	Notes to Unaudited Condensed Consolidated Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	24
Item 4.	Controls and Procedures	24
	PART II—OTHER INFORMATION
Item 1.	Legal Proceedings	25
Item 1A.	Risk Factors	25
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 3.	Defaults Upon Senior Securities	25
Item 4.	Mine Safety Disclosures	25
Item 5.	Other Information	25
Item 6.	Exhibits	26
Signatures		27

iii

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

COGENT BIOSCIENCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

(unaudited)

	March 31,			December 31,
	2021			2020
Assets
Current assets:
Cash and cash equivalents	$	230,739		$	242,190
Prepaid expenses and other current assets		1,330			2,722
Total current assets		232,069			244,912
Operating lease, right-of-use asset		4,169			4,615
Property and equipment, net		117			134
Restricted cash		1,255			1,255
Total assets	$	237,610		$	250,916
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	315		$	732
Accrued expenses and other current liabilities		2,750			4,779
CVR liability (Note 3)		3,060			5,531
Operating lease liability		2,117			2,052
Total current liabilities		8,242			13,094
Operating lease liability, net of current portion		2,605			3,155
Total liabilities		10,847			16,249
Commitments and contingencies (Note 8)
Stockholders’ equity:
Preferred stock, $0.001 par value; 9,000,000 shares authorized; no shares issued or outstanding		—			—
Series A non-voting convertible preferred stock, $0.001 par value; 1,000,000 shares authorized; 113,835 and 132,244 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively		94,681			110,881
Common stock, $0.001 par value; 150,000,000 shares authorized; 37,194,267 shares and 32,347,905 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively		37			32
Additional paid-in capital		342,473			322,454
Accumulated deficit		(210,428	)		(198,700	)
Total stockholders’ equity		226,763			234,667
Total liabilities and stockholders' equity	$	237,610		$	250,916

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

COGENT BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands, except share and per share amounts)

(unaudited)

	Three Months Ended March 31,
	2021			2020
Collaboration revenue	$	—		$	7,031
Operating expenses:
Research and development		8,213			9,498
General and administrative		4,587			3,674
Total operating expenses		12,800			13,172
Loss from operations		(12,800	)		(6,141	)
Other income:
Interest income		125			47
Other income		604			—
Change in fair value of CVR liability		343			—
Total other income		1,072			47
Net loss and comprehensive loss	$	(11,728	)	$	(6,094	)
Net loss per share attributable to common shareholders, basic and diluted	$	(0.34	)	$	(0.81	)
Weighted average common shares outstanding, basic and diluted		34,879,296			7,534,187

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

COGENT BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands, except share amounts)

(unaudited)

	Series A Non-Voting
	Convertible Preferred Stock						Common Stock				Additional Paid-in		Accumulated			Total Stockholders’
	Shares			Amount			Shares		Amount		Capital		Deficit			Equity
Balances at December 31, 2020		132,244		$	110,881			32,347,905	$	32	$	322,454	$	(198,700	)	$	234,667
Conversion of Series A non-voting preferred stock into common stock		(18,409	)		(16,200	)		4,602,250		5		16,195		—			—
Issuance of common stock to settle CVR liability		—			—			212,429		—		2,043		—			2,043
Issuance of common stock for services		—			—			31,683		—		260		—			260
Stock-based compensation expense		—			—			—		—		1,521		—			1,521
Net loss		—			—			—		—		—		(11,728	)		(11,728	)
Balances at March 31, 2021		113,835		$	94,681			37,194,267	$	37	$	342,473	$	(210,428	)	$	226,763

	Series A Non-Voting
	Convertible Preferred Stock				Common Stock					Additional Paid-in			Accumulated			Total Stockholders’
	Shares		Amount		Shares			Amount		Capital			Deficit			Equity
Balances at December 31, 2019		—	$	—		7,665,763		$	8	$	155,646		$	(123,892	)	$	31,762
Issuance of common stock upon exercise of stock options		—		—		51,823			—		38			—			38
Issuance of common stock under Employee Stock Purchase Plan		—		—		14,252			—		35			—			35
Issuance of common stock to LPC as a commitment fee		—		—		181,595			—		262			—			262
Acquisition and retirement of treasury stock		—		—		(207,961	)		—		(808	)					(808	)
Stock-based compensation expense		—		—		—			—		507			—			507
Net loss		—		—		—			—		—			(6,094	)		(6,094	)
Balances at March 31, 2020		—	$	—		7,705,472		$	8	$	155,680		$	(129,986	)	$	25,702

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

COGENT BIOSCIENCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

	Three Months Ended March 31,
	2021			2020
Cash flows from operating activities:
Net loss	$	(11,728	)	$	(6,094	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense		17			295
Stock-based compensation expense		1,781			769
Noncash consideration received from a customer		—			(808	)
Change in fair value of CVR liability		(343	)		—
Changes in operating assets and liabilities:

SEC Form 10-Q filed by Cogent Biosciences, Inc.