scph-10q_20210331.htm

10-Q 1 scph-10q_20210331.htm 10-Q scph-10q_20210331.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

☒	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: 001-38293

SCPHARMACEUTICALS INC.

(Exact name of registrant as specified in its charter)

Delaware

46-5184075

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

2400 District Avenue, Suite 310

01803 Burlington, Massachusetts (Zip Code)

(Address of principal executive office)

Registrant’s telephone number, including area code: (617) 517-0730

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, par value $0.0001	SCPH	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 11, 2021, the Registrant had 27,355,454 common shares, $0.0001 par value per share, outstanding.

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains express or implied forward-looking statements that are based on our management’s belief and assumptions and on information currently available to our management. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements relate to future events or our future operational or financial performance, and involve known and unknown risks, uncertainties and other 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 these forward-looking statements. Forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

•

the completion of activities required for the resubmission of the FUROSCIX^® new drug application, or NDA, with the SmartDose drug delivery system on our current projected timelines and subsequent review and potential approval by the U.S. Food and Drug Administration, or FDA, including any delays in submission or approval related to COVID-19;

•

the likelihood of approval by the FDA of our regulatory filings for FUROSCIX using our next generation delivery device;

	•	the timing or likelihood of other regulatory filings and approvals;
	•	the outcome of any bridging studies, clinical trials or human factors studies that may be required by the FDA for approval of any of our product candidates;

•

the commercialization of FUROSCIX, if approved, including launch preparation, ability to interact with physicians, patient access to FUROSCIX, manufacturing and supply chain, including any delays related to COVID-19 in our ongoing Health Economics and Outcomes Research study and future planned Phase 4 studies of FUROSCIX incorporating the SmartDose drug delivery system to support the pricing and access to our product candidates;

•

the pricing and reimbursement of FUROSCIX or any other of our product candidates, if approved;

•

the rate and degree of market acceptance and clinical utility of FUROSCIX or any other of our product candidates for which we receive marketing approval;

•

the initiation, timing, progress and results of our research and development programs, including future preclinical and clinical studies;

•

our ability to advance any other product candidates into, and successfully complete, clinical studies and obtain regulatory approval for them;

•

our ability to identify additional product candidates;

•

the implementation of our strategic plans for our business, product candidates and technology;

•

the scope of protection we are able to establish and maintain for intellectual property rights covering FUROSCIX or any other of our product candidates and technology;

•

estimates of our expenses, future revenues, capital requirements and our needs for additional financing;

•

our ability to manufacture, or the ability of third parties to deliver, sufficient quantities of components and drug product for commercialization of FUROSCIX or any other of our product candidates;

•

our ability to maintain and establish collaborations;

•

our financial performance;

•

developments relating to our competitors and our industry, including the impact of government regulation; and

•

other risks and uncertainties, including those listed under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2020.

In some cases, forward-looking statements can be identified by terminology such as “may,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue” or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond our control and which could materially affect results. Factors that may cause actual results to differ materially from current expectations include, among other things, those set forth in Item 1A, “Risk Factors” and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2020, which was filed with the Securities and Exchange Commission on March 23, 2021, as well as in our subsequent filings with the Securities and Exchange Commission. If one or more of these risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, then actual events or results may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee of future performance. While we may elect to update these forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required by applicable law. You should therefore not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this Quarterly Report on Form 10-Q.

SCPHARMACEUTICALS INC.

INDEX

		Page

PART I – FINANCIAL INFORMATION

Item 1.	Condensed Consolidated Financial Statements (unaudited)
	Condensed Consolidated Balance Sheets as of December 31, 2020 and March 31, 2021	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three Months Ended March 31, 2020 and March 31, 2021	2
	Condensed Consolidated Statements of Stockholders’ Equity for the Three Months Ended March 31, 2020 and March 31, 2021	3
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2020 and March 31, 2021	4
	Notes to Condensed Consolidated Financial Statements	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	18

Item 4.	Controls and Procedures	19

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	20
Item 1A.	Risk Factors	20
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	20
Item 3.	Defaults Upon Senior Securities	20
Item 4.	Mine Safety Disclosures	20
Item 5.	Other Information	20
Item 6.	Exhibits	20

Exhibit Index		21
Signatures		22

PART I — FINANCIAL INFORMATION

SCPHARMACEUTICALS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

(Unaudited)

	December 31,			March 31,
	2020			2021
Assets
Current assets
Cash and cash equivalents	$	71,819		$	75,837
Short-term investments		33,276			20,490
Prepaid expenses		2,610			2,637
Other current assets		121			102
Total current assets		107,826			99,066
Restricted cash		182			182
Property and equipment, net		93			85
Right-of-use lease assets - operating, net		815			717
Deposits and other assets		132			243
Total assets	$	109,048		$	100,293
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	1,666		$	753
Accrued expenses		4,787			3,585
Term loan, short-term		2,408			4,838
Lease obligation - operating, short-term		460			472
Total current liabilities		9,321			9,648
Term loan, long-term		16,858			14,515
Lease obligation - operating, long-term		480			356
Other liabilities		219			259
Total liabilities		26,878			24,778
Commitments and contingencies (Note 11)
Stockholders’ equity
Preferred stock, $0.0001 par value; 10,000,000 shares authorized and no shares issued and outstanding		-			-
Common stock, $0.0001 par value; 150,000,000 shares authorized as of March 31, 2021; 27,325,959 and 27,355,453 shares issued and outstanding as of December 31, 2020 and March 31, 2021, respectively		3			3
Additional paid-in capital		243,830			244,279
Accumulated deficit		(161,664	)		(168,766	)
Accumulated other comprehensive gain (loss)		1			(1	)
Total stockholders’ equity		82,170			75,515
Total liabilities and stockholders’ equity	$	109,048		$	100,293

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

SCPHARMACEUTICALS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(In thousands, except share and per share amounts)

(Unaudited)

	Three Months Ended March 31,
	2020			2021
Operating expenses:
Research and development	$	4,146		$	4,009
General and administrative		2,503			2,732
Total operating expenses		6,649			6,741
Loss from operations		(6,649	)		(6,741	)
Other (expense) income		(31	)		255
Interest income		224			20
Interest expense		(636	)		(636	)
Net loss	$	(7,092	)	$	(7,102	)
Net loss per share — basic and diluted	$	(0.35	)	$	(0.26	)
Weighted average common shares outstanding — basic and diluted		20,218,473			27,336,724

Other comprehensive loss:
Unrealized loss on short-term investments	$	-		$	(2	)
Comprehensive loss	$	(7,092	)	$	(7,104	)

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

SCPHARMACEUTICALS INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except share amounts)

(Unaudited)

					ADDITIONAL						OTHER			TOTAL
	COMMON STOCK				PAID-IN			ACCUMULATED			COMPREHENSIVE			STOCKHOLDERS'
	SHARES		AMOUNT		CAPITAL			DEFICIT			INCOME			EQUITY
At December 31, 2020		27,325,959	$	3	$	243,830		$	(161,664	)	$	1		$	82,170
Net loss		—		—		—			(7,102	)		—			(7,102	)
Issuance of common stock upon exercise of stock options		2,500		—		9			—			—			9
Vesting of restricted stock		26,994		—		(81	)		—			—			(81	)
Stock-based compensation		—		—		521			—			—			521
Unrealized loss on short-term investments		—		—		—			—			(2	)		(2	)
At March 31, 2021		27,355,453	$	3	$	244,279		$	(168,766	)	$	(1	)	$	75,515

At December 31, 2019		19,418,955	$	2	$	180,818		$	(129,455	)	$	—		$	51,365
Net loss		—		—		—			(7,092	)		—			(7,092	)
Issuance of common stock under at-the-market offering net of commissions and issuance costs (Note 9)		1,502,892		—		10,253			—			—			10,253
Issuance of common stock upon exercise of stock options		30,143		—		154			—			—			154
Vesting of restricted stock		29,890		—		(84	)		—			—			(84	)
Stock-based compensation		—		—		508

SEC Form 10-Q filed by scPharmaceuticals Inc.