10-Q

Large Accelerated Filer

Accelerated Filer

Non-Accelerated
Filer

Smaller reporting company

Emerging growth company

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 September 30, 2021

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

Commission file number

001-39244

Vincerx Pharma, Inc.

(Exact name of Registrant as Specified in Its Charter)


Delaware		83-3197402
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

260 Sheridan Avenue, Suite 400 Palo Alto, CA		94306
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (650)

800-6676

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, $0.0001 par value per share	VINC	The Nasdaq Stock Market LLC

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.

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 October 31, 2021, there were 21,021,075 shares of the registrant’s common stock outstanding.

Table of Contents

TABLE OF CONTENTS


Forward-Looking Statements			1
Frequently Used Terms			2
Summary Risk Factors			3
Part I			5
ITEM 1. 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			21
ITEM 4. Controls and Procedures			22
Part II			23
ITEM 1. Legal Proceedings			23
ITEM 1A. Risk Factors			23
ITEM 2. Exhibits			55

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Forward-Looking Statements

This report contains forward-looking statements that involve risks and uncertainties. These statements relate to future periods, future events or our future operating or financial plans or performance. When used in this report, the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “project,” “forecast,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “seeks,” “scheduled,” or “will,” and similar expressions are intended to identify forward-looking statements, and include but are not limited to:

•

our future financial and business performance;

•

strategic plans for our business and product candidates;

•

our ability to develop or commercialize products;

•

the expected results and timing of clinical trials and nonclinical studies;

•

our ability to comply with the Bayer License Agreement;

•

developments and projections relating to our competitors and industry;

•

our expectations regarding our ability to obtain, develop and maintain intellectual property protection and not infringe on the rights of others;

•

our ability to retain key scientific or management personnel;

•

our expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act;

•

our future capital requirements and the timing of those requirements and sources and uses of cash;

•

our ability to obtain funding for our operations;

•

the outcome of any known and unknown litigation and regulatory proceedings;

•

our business, expansion plans and opportunities; and

•

changes in applicable laws or regulations.

These statements are subject to known and unknown risks, uncertainties and assumptions that could cause actual results to differ materially from those projected or otherwise implied by the forward-looking statements, including the following:

•

risks associated with preclinical or clinical development and trials, including those conducted prior to our

in-licensing;

•

risks related to the rollout of our business and the timing of expected business milestones;

•

changes in the assumptions underlying our expectations regarding our future business or business model;

•

our ability to develop, manufacture and commercialize product candidates;

•

general economic, financial, legal, political and business conditions and changes in domestic and foreign markets;

•

changes in applicable laws or regulations;

•

the impact of natural disasters, including climate change, and the impact of health epidemics, including the

COVID-19

pandemic, on our business;

•

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

•

market acceptance of our planned products;

•

our ability to raise capital;

•

the possibility that we may be adversely affected by other economic, business, and/or competitive factors; and

•

other risks and uncertainties set forth in this report in the section entitled “Risk Factors.”

Given these risks and uncertainties, you should not place undue reliance on these forward-looking statements.

Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expected. These risks and uncertainties include, but are not limited to, those risks discussed in Item 1A of this report. These forward-looking statements made by us in this report speak only as of the date of this report. Except as required under the federal securities laws and rules and regulations of the Securities and Exchange Commission (the “SEC”), we expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement

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is based. You should, however, review additional disclosures we make in our Annual Report on Form

10-K/A

for the year ended December 31, 2020, definitive proxy statement for the 2021 Annual Meeting of Stockholders, Quarterly Reports on Form

10-Q,

and Current Reports on Form

8-K

filed with the SEC.

You should read this report completely and with the understanding that our actual future results, levels of activity and performance as well as other events and circumstances may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

Frequently Used Terms

Unless the context indicates otherwise, references in this report to the “Company,” “Vincerx,” “we,” “us,” “our” and similar terms refer to Vincerx Pharma, Inc. (f/k/a Vincera Pharma, Inc. f/k/a LifeSci Acquisition Corp.) and its consolidated subsidiaries. References to “LSAC” refer to LifeSci Acquisition Corp., our predecessor company prior to the consummation of the Business Combination (as defined below). Additional terms frequently used in this report include the following:

•

“ADC” means antibody-drug conjugate.

•

“BLA” means a biologics license application.

•

“Business Combination” means the Merger and the other transactions described in the Merger Agreement.

•

“Bylaws” means our amended and restated bylaws.

•

“Certificate of Incorporation” means our second amended and restated certificate of incorporation, as amended.

•

“cGMP” means current Good Manufacturing Practice.

•

“common stock” means our common stock, $0.0001 par value per share.

•

“Earnout Shares” means certain rights to common stock after the closing of the Business Combination that Legacy Holders may be entitled to receive pursuant to the Merger Agreement.

•

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

•

“FDA” means the U.S. Food and Drug Administration.

•

“IND” means an investigational new drug application.

•

“KSPi” means kinesin spindle protein inhibitor.

•

“Legacy Holders” means the stockholders of Legacy Vincera Pharma immediately prior to the Business Combination.

•

“Legacy Vincera Pharma” means Vincera Pharma, Inc. prior to the consummation of the Business Combination, which changed its name to VNRX Corp. following the Business Combination.

•

“Merger” means the merger of Merger Sub with and into Legacy Vincera Pharma, with Legacy Vincera Pharma surviving as the surviving company and as a wholly-owned subsidiary of LSAC, which occurred on December 23, 2020.

•

“Merger Agreement” means that certain Merger Agreement, dated September 25, 2020, by and among LSAC, Merger Sub, Legacy Vincera Pharma and Raquel E. Izumi, as the representative of the Legacy Holders.

•

“Merger Sub” means LifeSci Acquisition Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of LSAC at the time of the Business Combination.

•

“NDA” means a new drug application.

•

“PTEFb/CDK9” means positive transcription elongation factor beta/cyclin-dependent kinase 9.

•

“Securities Act” means the Securities Act of 1933, as amended.

•

“Sponsor” means LifeSci Investments, LLC, LSAC’s sponsor and an entity affiliated with LifeSci Capital LLC, which was dissolved effective January 28, 2021.

•

“Warrant Agreement” means that certain Warrant Agreement, dated March 5, 2020, between LSAC and the Continental Stock Transfer & Trust Company.

Vincerx

™

, Vincerx Pharma

™

, the Vincerx Wings logo design and CellTrapper

™

are our trademarks or registered trademarks. This report may also contain trademarks and trade names that are the property of their respective owners.

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Summary Risk Factors

Our business is subject to numerous risks and uncertainties that could affect our ability to successfully implement our business strategy and affect our financial results. You should carefully consider all of the information in this report and, in particular, the following principal risks and all of the other specific factors described in Item 1A of this report, “Risk Factors,” before deciding whether to invest in our company.

•

We rely on the Bayer License Agreement to provide rights to the core intellectual property relating to all of our current product candidates, which agreement imposes significant payment and other obligations on us. Any failure by us to perform our obligations under the Bayer License Agreement could give Bayer AG (“Bayer”) the right to terminate or seek other remedies under the agreement, and any termination or loss of important rights under the Bayer License Agreement would significantly and adversely affect our ability to develop and commercialize VIP152, VIP943, VIP924, VIP236 and our other current product candidates, raise capital or continue our operations.

•

We rely on the preclinical and clinical trial data provided by Bayer in assessing the viability of our product candidates, and such preclinical and clinical trial data has not been verified by us or any independent third parties.

•

Our business, operations and clinical development plans and timelines and supply chain could be adversely affected by the effects of epidemics, including the ongoing

COVID-19

pandemic, on the manufacturing, clinical trial and other business activities performed by us or by third parties with whom we conduct business, including our contract manufacturers, contract research organizations, shippers and others.

•

We are substantially dependent on the success of our lead product candidate, VIP152, which is currently in clinical trials. If we are unable to complete development of, obtain approval for and commercialize VIP152 in a timely manner, our business will be harmed.

•

We are at an early stage in development efforts for our product candidates and we may not be able to successfully develop, manufacture and commercialize our product candidates on a timely basis or at all.

•

There is currently no CDK9 inhibitor, ADC delivering a KSPi warhead or small molecule drug conjugate delivering a new chemical entity payload that has to date been approved by the FDA, and the development of our product candidates may never lead to a marketable product.

•

Our long-term prospects depend in part upon discovering, developing, manufacturing and commercializing additional product candidates, which may fail in development or suffer delays that adversely affect their commercial viability.

•

Results from early-stage clinical trials may not be predictive of results from late-stage or other clinical trials.

•

Interim, “topline” and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data become available and are subject to audit and verification procedures that could result in material changes in the final data.

•

Even if approved, our product candidates may not achieve adequate market acceptance among physicians, patients, healthcare payors and others in the medical community necessary for commercial success.

•

If the market opportunity for any product candidate that we or our strategic partners develop is smaller than we believe, our revenue may be adversely affected and our business may suffer.

•

We face significant competition, and if our competitors develop and market technologies or products more rapidly than we do or that are more effective, safer or less expensive than the product candidates we develop, our commercial opportunities will be negatively impacted.

•

We may expend our limited resources to pursue a particular product candidate or indication and fail to capitalize on product candidates or indications that may be more profitable or for which there is a greater likelihood of success.

•

Our business entails a significant risk of product liability and if we are unable to obtain sufficient insurance coverage such inability could have an adverse effect on our business and financial condition.

•

Any product candidates we develop may become subject to unfavorable third party coverage and reimbursement practices, as well as pricing regulations.

•

Clinical trials are expensive, time consuming, subject to delay and may be required to continue beyond our available funding, and we cannot be certain that we will be able to raise sufficient funds to complete the development and commercialize any of our product candidates currently in preclinical and clinical development, should they succeed.

•

We are at an early stage of development as a company and our limited operating history may make it difficult to evaluate our ability to succeed.

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•

We have incurred net losses since inception, and we expect to continue to incur significant net losses for the foreseeable future.

•

We require substantial capital to finance our operations. If we are unable to raise such capital when needed, or on acceptable terms, we may be forced to delay, reduce and/or eliminate one or more of our research and drug development programs or future commercialization efforts.

•

The Bayer License Agreement obligates us to make significant milestone and royalty payments, some of which will be triggered prior to the commercialization of any of our other product candidates.

•

We may be unable to obtain U.S. or foreign regulatory approvals and, as a result, may be unable to commercialize our product candidates.

•

Our current or future product candidates may cause adverse events, toxicities or other undesirable side effects when used alone or in combination with other approved products or investigational new drugs that may result in a safety profile that could inhibit regulatory approval, prevent market acceptance, limit their commercial potential or result in significant negative consequences.

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PART I

ITEM 1.

Financial Statements.

VINCERX PHARMA, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)


	September 30, 2021			December 31, 2020
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	122,796		$	61,792
Prepaid expenses		452			1,104
Other current assets		—			214

Total current assets		123,248			63,110
Right-of-use assets		4,169			—
Property plant and equipment		250			—
Other assets		1,758			82

Total assets	$	129,425		$	63,192

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	2,259		$	491
Accrued expenses		4,668			—
Lease liability		532			—
License payable		—			5,000
Due to related parties		—			14
Common stock warrant liabilities		17,703			32,308

Total current liabilities		25,162			37,813
Lease liability, net of current portion		3,637			—

Total liabilities		28,799			37,813

Commitments and contingencies—Note 5
Stockholders’ equity
Preferred stock, $0.0001 par value; 30,000,000 shares authorized, none issued and outstanding at September 30, 2021 and December 31, 2020		—			—
Common stock, $0.0001 par value; 120,000,000 shares authorized as of September 30, 2021 and December 31, 2020; 21,021,075 shares and 13,984,441 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively		2			1
Additional paid-in capital		150,142			42,043
Accumulated other comprehensive loss		(19	)		—
Accumulated deficit		(49,499	)		(16,665	)

Total stockholders’ equity		100,626			25,379

Total liabilities and stockholders’ equity	$	129,425		$	63,192

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

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VINCERX PHARMA, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

(In thousands, except per share amounts)


	For the three months ended September 30,						For the nine months ended September 30,
	2021			2020			2021			2020
Operating expenses:
General and administrative	$	5,720		$	305		$	17,206		$	342
Research and development		12,211			—			27,743			—

Total operating expenses		17,931			305			44,949			342

Loss from operations		(17,931	)		(305	)		(44,949	)		(342	)

Other income (expense)
Change in fair value of warrant liabilities		(6,606	)		—			12,102			—
Other income (expense)		13			(2	)		13			(2	)

Total other income (expense)		(6,593	)		(2	)		12,115			(2	)

Net loss		(24,524	)		(307	)		(32,834	)		(344	)
Other comprehensive loss:
Net foreign currency translation loss		(19	)		—			(19	)		—

Comprehensive loss	$	(24,543	)	$	(307	)	$	(32,853	)	$	(344	)

Net loss per common share, basic and diluted	$	(1.39	)	$	(0.06	)	$	(2.06	)	$	(0.07	)

Weighted average common shares outstanding, basic and diluted		17,694			5,076			15,941			5,018

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

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VINCERX PHARMA, INC.

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

(Unaudited) (

in thousands

)

SEC Form 10-Q filed by Vincerx Pharma, Inc.