SEC Filing - Regenxbio Inc

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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, 2022

☐	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 001-37553

REGENXBIO Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware		47-1851754
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

9804 Medical Center Drive Rockville, MD		20850
(Address of principal executive offices)		(Zip Code)

(240) 552-8181

(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, par value $0.0001 per share	RGNX	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 July 27, 2022, there were 43,229,971 shares of the registrant’s common stock, par value $0.0001 per share, issued and outstanding.

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REGENXBIO INC.

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2022

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	PART I—FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)	3
	Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021	3
	Consolidated Statements of Operations and Comprehensive Loss for the Three and Six Months Ended June 30, 2022 and 2021	4
	Consolidated Statements of Stockholders’ Equity for the Three and Six Months Ended June 30, 2022 and 2021	5
	Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2022 and 2021	6
	Notes to Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
Item 4.	Controls and Procedures	31

	PART II—OTHER INFORMATION

Item 1.	Legal Proceedings	33
Item 1A.	Risk Factors	33
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 3.	Defaults Upon Senior Securities	33
Item 4.	Mine Safety Disclosures	33
Item 5.	Other Information	33
Item 6.	Exhibits	34
Signatures		35

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INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the Securities Act), and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). These statements express a belief, expectation or intention and are generally accompanied by words that convey projected future events or outcomes such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “assume,” “design,” “intend,” “expect,” “could,” “plan,” “potential,” “predict,” “seek,” “should,” “would” or by variations of such words or by similar expressions. We have based these forward-looking statements on our current expectations and assumptions and analyses in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. However, whether actual results and developments will conform with our expectations and predictions is subject to a number of risks, uncertainties, assumptions and other important factors, including, but not limited to:

•

our ability to establish and maintain development partnerships, including our collaboration with AbbVie to develop and commercialize RGX-314;

•

our ability to obtain and maintain regulatory approval of our product candidates and the labeling for any approved products;

•

the timing of enrollment, commencement and completion and the success of our clinical trials, including the timing and commencement of our AFFINITY DUCHENNE clinical trial;

•

the timing of commencement and completion and the success of preclinical studies conducted by us and our development partners;

•

the timely development and launch of new products;

•

the scope, progress, expansion and costs of developing and commercializing our product candidates;

•

our ability to obtain, maintain and enforce intellectual property protection for our product candidates and technology, and defend against third-party intellectual property-related claims;

•

our expectations regarding the development and commercialization of product candidates currently being developed by third parties that utilize our technology;

•

the impact of the COVID-19 pandemic on our business, operations and preclinical and clinical development timelines and plans;

•

our anticipated growth strategies;

•

our expectations regarding competition;

•

the anticipated trends and challenges in our business and the market in which we operate;

•

our ability to attract or retain key personnel;

•

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

•

the rate and degree of market acceptance of any of our products that are approved;

•

our expectations regarding our expenses and revenue;

•

our expectations regarding the outcome of legal proceedings;

•

our expectations regarding regulatory developments in the United States and foreign countries; and

•

our ability to accurately predict how long our existing cash resources will be sufficient to fund our anticipated operating expenses.

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You should carefully read the factors discussed in the sections titled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this Quarterly Report on Form 10-Q, our Annual Report on Form 10-K for the year ended December 31, 2021 and in our other filings with the U.S. Securities and Exchange Commission (the SEC) for additional discussion of the risks, uncertainties, assumptions and other important factors that could cause our actual results or developments to differ materially and adversely from those projected in the forward-looking statements. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on us or our businesses or operations. Such statements are not guarantees of future performance and actual results or developments may differ materially and adversely from those projected in the forward-looking statements. These forward-looking statements speak only as of the date of this report. Except as required by law, we disclaim any duty to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Available Information

Our principal offices are located at 9804 Medical Center Drive, Rockville, MD 20850, and our telephone number is (240) 552-8181. Our website address is www.regenxbio.com. The information contained in, or that can be accessed through, our website is not a part of, or incorporated by reference in, this Quarterly Report on Form 10-Q. We file annual, quarterly, and current reports, proxy statements, and other documents with the SEC under the Exchange Act. You may obtain any reports, proxy and information statements, and other information that we file electronically with the SEC at www.sec.gov.

You also may view and download copies of our SEC filings free of charge at our website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. The information contained on, or that can be accessed through, our website will not be deemed to be incorporated by reference in, and is not considered part of, this Quarterly Report on Form 10-Q. Investors should also note that we use our website, as well as SEC filings, press releases, public conference calls and webcasts, to announce financial information and other material developments regarding our business. We use these channels, as well as any social media channels listed on our website, to communicate with investors and members of the public about our business. It is possible that the information that we post on our social media channels could be deemed material information. Therefore, we encourage investors, the media and others interested in our company to review the information that we post on our social media channels.

As used in this Quarterly Report on Form 10-Q, the terms “REGENXBIO,” “we,” “us,” “our” or the “Company” mean REGENXBIO Inc. and its subsidiaries, on a consolidated basis, unless the context indicates otherwise.

AAVIATE, ALTITUDE, ATMOSPHERE, NAV, REGENXBIO and the REGENXBIO logos are our registered trademarks. Any other trademarks appearing in this Quarterly Report on Form 10-Q are the property of their respective holders.

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PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

REGENXBIO INC.

CONSOLIDATED BALANCE SHEETS

(unaudited)

(in thousands, except per share data)

	June 30, 2022			December 31, 2021
Assets
Current assets
Cash and cash equivalents	$	121,374		$	345,209
Marketable securities		281,588			112,230
Accounts receivable, net		37,500			32,439
Prepaid expenses		16,245			18,752
Other current assets		8,717			10,196
Total current assets		465,424			518,826
Marketable securities		279,073			391,907
Accounts receivable, net		2,034			2,262
Property and equipment, net		138,815			131,547
Operating lease right-of-use assets		60,163			60,904
Restricted cash		2,030			2,030
Other assets		5,905			6,428
Total assets	$	953,444		$	1,113,904
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	16,985		$	11,387
Accrued expenses and other current liabilities		47,014			76,111
Deferred revenue		6,636			3,333
Operating lease liabilities		2,832			1,752
Liability related to sale of future royalties		41,089			37,889
Total current liabilities		114,556			130,472
Operating lease liabilities		85,672			84,929
Liability related to sale of future royalties		114,171			133,460
Other liabilities		8,526			745
Total liabilities		322,925			349,606
Stockholders’ equity
Preferred stock; $0.0001 par value; 10,000 shares authorized, no shares issued and outstanding at June 30, 2022 and December 31, 2021		—			—
Common stock; $0.0001 par value; 100,000 shares authorized at June 30, 2022 and December 31, 2021; 43,171 and 42,831 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively		4			4
Additional paid-in capital		951,412			928,095
Accumulated other comprehensive loss		(14,763	)		(2,569	)
Accumulated deficit		(306,134	)		(161,232	)
Total stockholders’ equity		630,519			764,298
Total liabilities and stockholders’ equity	$	953,444		$	1,113,904

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

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REGENXBIO INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(unaudited)

(in thousands, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2022			2021
Revenues
License and royalty revenue	$	32,649		$	22,035		$	54,867		$	40,919
Total revenues		32,649			22,035			54,867			40,919
Operating Expenses
Cost of revenues		12,951			9,819			28,668			14,670
Research and development		61,008			45,882			116,635			85,604
General and administrative		20,832			18,425			43,150			36,263
Credit losses and other		391			135			474			650
Total operating expenses		95,182			74,261			188,927			137,187
Loss from operations		(62,533	)		(52,226	)		(134,060	)		(96,268	)
Other Income (Expense)
Interest income from licensing		153			554			247			583
Investment income		1,061			399			1,860			979
Interest expense		(6,860	)		(6,366	)		(12,990	)		(13,068	)
Total other income (expense)		(5,646	)		(5,413	)		(10,883	)		(11,506	)
Loss before income taxes		(68,179	)		(57,639	)		(144,943	)		(107,774	)
Income Tax Benefit (Expense)		—			—			41			(4	)
Net loss	$	(68,179	)	$	(57,639	)	$	(144,902	)	$	(107,778	)
Other Comprehensive Income (Loss)
Unrealized gain (loss) on available-for-sale securities, net		(2,813	)		113			(12,194	)		(895	)
Total other comprehensive income (loss)		(2,813	)		113			(12,194	)		(895	)
Comprehensive loss	$	(70,992	)	$	(57,526	)	$	(157,096	)	$	(108,673	)

Net loss per share, basic and diluted	$	(1.58	)	$	(1.36	)	$	(3.37	)	$	(2.56	)
Weighted-average common shares outstanding, basic and diluted		43,111			42,510			43,028			42,170

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

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REGENXBIO INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(unaudited)

(in thousands)

	Three Months Ended June 30, 2022
							Accumulated
					Additional		Other						Total
	Common Stock				Paid-in		Comprehensive			Accumulated			Stockholders’
	Shares		Amount		Capital		Loss			Deficit			Equity
Balances at March 31, 2022		42,982	$	4	$	939,570	$	(11,950	)	$	(237,955	)	$	689,669
Vesting of restricted stock units, net of tax		3		—		—		—			—			—
Exercise of stock options, net of tax		186		—		1,507		—			—			1,507
Stock-based compensation expense		—		—		10,335		—			—			10,335
Unrealized loss on available-for-sale securities, net		—		—		—		(2,813	)		—			(2,813	)
Net loss		—		—		—		—			(68,179	)		(68,179	)
Balances at June 30, 2022		43,171	$	4	$	951,412	$	(14,763	)	$	(306,134	)	$	630,519

	Three Months Ended June 30, 2021
							Accumulated
					Additional		Other						Total
	Common Stock				Paid-in		Comprehensive			Accumulated			Stockholders’
	Shares		Amount		Capital		Loss			Deficit			Equity
Balances at March 31, 2021		42,505	$	4	$	895,079	$	(1,368	)	$	(339,211	)	$	554,504
Exercise of stock options		50		—		275		—			—			275
Stock-based compensation expense		—		—		9,992		—			—			9,992
Unrealized gain on available-for-sale securities, net		—		—		—		113			—			113
Net loss		—		—		—		—			(57,639	)		(57,639	)
Balances at June 30, 2021		42,555	$	4	$	905,346	$	(1,255	)	$	(396,850	)	$	507,245

	Six Months Ended June 30, 2022
								Accumulated
					Additional			Other						Total
	Common Stock				Paid-in			Comprehensive			Accumulated			Stockholders’
	Shares		Amount		Capital			Loss			Deficit			Equity
Balances at December 31, 2021		42,831	$	4	$	928,095		$	(2,569	)	$	(161,232	)	$	764,298
Vesting of restricted stock units, net of tax		55		—		(284	)		—			—			(284	)
Exercise of stock options, net of tax		263		—		1,844			—			—			1,844
Issuance of common stock under employee stock purchase plan		22		—		622			—			—			622
Stock-based compensation expense		—		—		21,135			—			—			21,135
Unrealized loss on available-for-sale securities, net		—		—		—			(12,194	)		—			(12,194	)
Net loss		—		—		—			—			(144,902	)		(144,902	)
Balances at June 30, 2022		43,171	$	4	$	951,412		$	(14,763	)	$	(306,134	)	$	630,519

	Six Months Ended June 30, 2021
							Accumulated
					Additional		Other						Total
	Common Stock				Paid-in		Comprehensive			Accumulated			Stockholders’
	Shares		Amount		Capital		Loss			Deficit			Equity
Balances at December 31, 2020		37,476	$	4	$	667,181	$	(360	)	$	(289,072	)	$	377,753
Issuance of common stock upon public offering, net of transaction costs of $14,194		4,899		—		216,059		—			—			216,059
Exercise of stock options		161		—		1,567		—			—			1,567
Issuance of common stock under employee stock purchase plan		19		—		627		—			—			627
Stock-based compensation expense		—		—		19,912		—			—			19,912
Unrealized loss on available-for-sale securities, net		—		—		—