sesn-20210630

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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 June 30, 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: 001-36296

Sesen Bio, Inc.

(Exact name of registrant as specified in its charter)


Delaware			26-2025616
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)


245 First Street, Suite 1800 Cambridge, MA			02142
(Address of principal executive offices)			(Zip Code)

(617) 444-8550

(Registrant’s telephone number, including area code)

Not applicable.

(Former name, former address and former fiscal year, if changed since last report)

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	SESN	The Nasdaq Stock 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 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, 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	☐	Smaller reporting company	☒
Accelerated Filer	☐	Emerging growth company	☐
Non-accelerated filer	☒

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 ☒

There were 196,002,620 shares of the registrant's common stock outstanding as of August 2, 2021.

Table of Contents

SESEN BIO, INC.

Quarterly Report on Form 10-Q for the Quarterly Period ended June 30, 2021

Table of Contents


		Page
	PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements.	1
	Condensed Consolidated Balance Sheets as of June 30, 2021 and December 31, 2020	1
	Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the Three and Six Months ended June 30, 2021 and 2020	2
	Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit) for the Three and Six Months ended June 30, 2021 and 2020	3
	Condensed Consolidated Statements of Cash Flows for the Six Months ended June 30, 2021 and 2020	4
	Notes to Condensed Consolidated Financial Statements	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	39
Item 4.	Controls and Procedures.	39

	PART II - OTHER INFORMATION
Item 1.	Legal Proceedings.	40
Item 1A.	Risk Factors.	40
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	40
Item 3.	Defaults Upon Senior Securities.	40
Item 4.	Mine Safety Disclosures.	40
Item 5.	Other Information.	40
Item 6.	Exhibits.	41

	SIGNATURES

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

SESEN BIO, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited; In thousands, except share and per share data)


	June 30, 2021		December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	151,036	$	52,389
Accounts receivable	2,303		—
Prepaid expenses and other current assets	21,760		7,478
Restricted cash	—		3,000
Total current assets	175,099		62,867

Non-current assets:
Restricted cash	20		20
Property and equipment, net	109		123
Intangible assets	46,400		46,400
Goodwill	13,064		13,064
Long term prepaid expenses	6,150		—
Other assets	205		349
Total non-current assets	65,948		$	59,956
Total Assets	$	241,047	$	122,823

Liabilities and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable	$	1,228	$	3,102
Accrued expenses	5,301		3,973
Deferred revenue	1,500		1,500
Contingent consideration	10,300		8,985
Other current liabilities	498		489
Total current liabilities	18,827		18,049

Non-current liabilities:
Contingent consideration, net of current portion	160,300		99,855
Deferred tax liability	12,528		12,528
Deferred revenue, net of current portion	—		1,500
Other non-current liabilities	43		118
Total non-current liabilities	172,871		114,001
Total liabilities	191,698		132,050


Stockholders’ Equity (Deficit):
Preferred stock, $0.001 par value per share; 5,000,000 shares authorized at June 30, 2021 and December 31, 2020; no shares issued and outstanding at June 30, 2021 and December 31, 2020	—		—
Common stock, $0.001 par value per share; 400,000,000 and 200,000,000 shares authorized at June 30, 2021 and December 31, 2020, respectively; 188,460,951 and 140,449,647 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively	188		140
Additional paid-in capital	446,036		306,554
Accumulated deficit	(396,875)		(315,921)
Total Stockholders’ Equity (Deficit)	49,349		(9,227)
Total Liabilities and Stockholders’ Equity	$	241,047	$	122,823

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

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SESEN BIO, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE (LOSS) INCOME

(Unaudited; In thousands, except per share data)


	Three Months ended June 30,				Six Months ended June 30,
	2021		2020		2021		2020
License and related revenue	$	2,234	$	—	$	6,544	$	—

Operating expenses:
Research and development	7,228		4,562		13,306		13,429
General and administrative	6,805		3,318		12,098		6,766
Change in fair value of contingent consideration	13,600		18,480		61,760		(35,220)
Total operating expenses	27,633		26,360		87,164		(15,025)

(Loss) Income from Operations	(25,399)		(26,360)		(80,620)		15,025
Other (expense) income , net	(43)		16		(46)		195
Net (Loss) Income and Comprehensive (Loss) Income Before Taxes	(25,442)		(26,344)		(80,666)		15,220
Provision for income taxes	—		—		(288)		—
Net (Loss) Income and Comprehensive (Loss) Income After Taxes	$	(25,442)	$	(26,344)	$	(80,954)	$	15,220



Net (loss) income attributable to common stockholders - basic	$	(25,442)	$	(26,491)	$	(80,954)	$	14,751
Net (loss) income attributable to common stockholders - diluted	(25,442)		(26,491)		(80,954)		12,600

Net (loss) income per common share - basic	$	(0.15)	$	(0.24)	$	(0.49)	$	0.13
Weighted-average common shares outstanding - basic	175,393		112,569		166,264		111,189

Net (loss) income per common share - diluted	$	(0.15)	$	(0.24)	$	(0.49)	$	0.11
Weighted-average common shares outstanding - diluted	175,393		112,569		166,264		111,203

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

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SESEN BIO, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

(Unaudited; In thousands, except share data)


	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Stockholders’ Equity
	Shares	Amount
Balance at December 31, 2020	140,449,647	$	140	$	306,554	$	(315,921)	$

SEC Form 10-Q filed by Sesen Bio, Inc.