SEC Filing - Imara

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imra-10q_20200930.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 September 30, 2020

☐	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: 001-39247

IMARA INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware	81-1523849
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
116 Huntington Avenue, 6^th Floor Boston, Massachusetts	02116
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (617) 206-2020

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 $0.001 per share

IMRA

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 30, 2020, the registrant had 17,407,441 shares of common stock, $0.001 par value per share, outstanding.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that involve substantial risks and uncertainties. All statements, other than statements of historical fact, 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 and objectives of management, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “would,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

The forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to those described under the “Risk Factors” section and include, among other things:

•

the impact of the ongoing COVID-19 pandemic and our response to it;

•

the initiation, timing, progress and results of our current and future preclinical studies and clinical trials, including our ongoing Phase 2a, open label extension and Phase 2b clinical trials of IMR-687 in patients with SCD and our ongoing Phase 2b clinical trial of IMR-687 in patients with β-thalassemia;

•

our development plans regarding HFpEF;

•

our estimates regarding expenses, future revenue, timing of any future revenue, capital requirements and need for additional financing;

•

our plans to develop and, if approved, subsequently commercialize IMR-687 and any other product candidates, including in combination with other drugs and therapies;

•

the timing of and our ability to submit applications for, obtain and maintain regulatory approvals for IMR-687 and any other product candidates we may identify and pursue;

•

our expectations regarding our ability to fund our operating expenses and capital expenditure requirements with our cash, cash equivalents and investments;

•

the potential advantages or differentiating features of IMR-687 and any other product candidates we may identify and pursue;

•

the rate and degree of market acceptance and clinical utility of IMR-687 and any other product candidates we may identify and pursue;

•

our estimates regarding the potential market opportunity for IMR-687 and any other product candidates we may identify and pursue;

•

our commercialization, marketing and manufacturing capabilities and strategy;

•

our expectations regarding our ability to obtain and maintain intellectual property protection for IMR-687 and any other product candidates we may identify and pursue;

•

our ability to identify additional products, product candidates or technologies with significant commercial potential that are consistent with our commercial objectives;

•

the impact of government laws and regulations;

•

our competitive position and expectations regarding developments and projections relating to our competitors and any competing therapies that are or become available;

•

our ability to maintain and establish collaborations or obtain additional funding; and

•

our expectations regarding the time during which we will be an emerging growth company under the JOBS Act.

We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make. In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information.

We have included important factors in the cautionary statements included in this Quarterly Report on Form 10-Q, particularly in the “Risk Factors” section, that we believe could cause actual results or events to differ materially from the forward-looking statements that we make. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, collaborations, joint ventures or investments we may make or enter into.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION	1
Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets as of September 30, 2020 and December 31, 2019	1
	Condensed Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended September 30, 2020 and 2019	2
	Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) for the Three and Nine Months Ended September 30, 2020 and 2019	3
	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2020 and 2019	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	26
PART II.	OTHER INFORMATION	27
Item 1A.	Risk Factors	27
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	71
Item 6.	Exhibits	72
Signatures		73

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

IMARA INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)
(Unaudited)

	September 30, 2020			December 31, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	34,158		$	4,936
Short-term investments		61,931			23,971
Prepaid expenses and other current assets		3,622			1,717
Total current assets		99,711			30,624
Property and equipment, net	376				442
Other assets	88				2,232
Total assets	$	100,175		$	33,298
LIABILITIES, CONVERTIBLE PREFERRED STOCK & STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	1,886		$	1,658
Accrued expenses and other current liabilities		3,424			2,540
Total current liabilities		5,310			4,198
Deferred rent	167				184
Total liabilities		5,477			4,382
Commitments and contingencies (Note 7)
Convertible preferred stock, $0.001 par value per share; no shares authorized, issued or outstanding as of September 30, 2020; 70,378,661 shares authorized and 60,533,313 shares issued and outstanding as of December 31, 2019		—			77,764
Stockholders’ equity (deficit):
Preferred stock, $0.001 par value per share; 10,000,000 shares authorized; no shares issued or outstanding as of September 30, 2020; no shares authorized, issued or outstanding as of December 31, 2019		—			—
Common stock, $0.001 par value per share; 200,000,000 and 100,000,000 shares authorized as of September 30, 2020 and December 31, 2019, respectively; 17,377,067 and 702,510 shares issued and outstanding as of September 30, 2020 and December 31, 2019, respectively	18				1
Additional paid-in capital		179,251			5,872
Accumulated other comprehensive income		24			32
Accumulated deficit		(84,595	)		(54,753	)
Total stockholders’ equity (deficit)		94,698			(48,848	)
Total liabilities, convertible preferred stock and stockholders’ equity (deficit)	$	100,175		$	33,298

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

IMARA INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands, except share and per share data)
(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2020			2019			2020			2019
Operating expenses:
Research and development	$	9,533		$	5,141		$	23,195		$	13,067
General and administrative		2,961			1,741			6,953			3,566
Total operating expenses		12,494			6,882			30,148			16,633
Loss from operations		(12,494	)		(6,882	)		(30,148	)		(16,633	)
Total other income:
Interest income		126			254			368			414
Other income (expense)		(55	)		6			(62	)		6
Total other income (net)		71			260			306			420
Net loss	$	(12,423	)	$	(6,622	)	$	(29,842	)	$	(16,213	)
Accretion of Series B convertible preferred stock		—			—			(7,858	)		—
Net loss attributable to common stockholders—basic and diluted	$	(12,423	)	$	(6,622	)	$	(37,700	)	$	(16,213	)
Weighted-average common shares outstanding—basic and diluted		17,349,813			702,510			12,696,368			702,510
Net loss per share attributable to common stockholders—basic and diluted	$	(0.72	)	$	(9.43	)	$	(2.97	)	$	(23.08	)
Comprehensive loss:
Net loss	$	(12,423	)	$	(6,622	)	$	(29,842	)	$	(16,213	)
Other comprehensive income:
Unrealized gain (loss) on investments (net)		(24	)		30			(8	)		30
Comprehensive loss	$	(12,447	)	$	(6,592	)	$	(29,850	)	$	(16,183	)

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

IMARA INC.

CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)

(in thousands, except share and per share data)
(Unaudited)

	CONVERTIBLE PREFERRED STOCK												COMMON
	SERIES SEED $0.001 PAR VALUE				SERIES A $0.001 PAR VALUE				SERIES B $0.001 PAR VALUE				STOCK $0.001 PAR VALUE				ADDITIONAL PAID-IN		ACCUMULATED OTHER COMPREHENSIVE		ACCUMULATED			TOTAL STOCKHOLDERS’ EQUITY
	SHARES		AMOUNT		SHARES		AMOUNT		SHARES		AMOUNT		SHARES		AMOUNT		CAPITAL		INCOME (LOSS)		DEFICIT			(DEFICIT)
Balance at December 31, 2018		2,712,960	$	1,460		31,499,040	$	30,729		—	$	—		702,510	$	1	$	4,973	$	—	$	(31,290	)	$	(26,316	)
Issuance of Series B convertible preferred stock, net of issuance costs of $274		—		—		—		—		25,316,663		43,825		—		—		—		—		—			—
Stock-based compensation expense		—		—		—		—		—		—		—		—		95		—		—			95
Net loss		—		—		—		—		—		—		—		—		—		—		(4,194	)		(4,194	)
Balance at March 31, 2019		2,712,960	$	1,460		31,499,040	$	30,729		25,316,663	$	43,825		702,510	$	1	$	5,068	$	—	$	(35,484	)	$	(30,415	)
Issuance of Series B convertible preferred stock, net of issuance costs		—		—		—		—		1,004,650		1,750		—		—		—		—		—			—
Stock-based compensation expense		—		—		—		—		—		—		—		—		197		—		—			197
Net loss		—		—		—		—		—		—		—		—		—		—		(5,397	)		(5,397	)
Balance at June 30, 2019		2,712,960	$	1,460		31,499,040	$	30,729		26,321,313	$	45,575		702,510	$	1	$	5,265	$	—	$	(40,881	)	$	(35,615	)
Stock-based compensation expense		—		—		—		—		—		—		—		—		310		—		—			310
Unrealized gain on investments		—		—		—		—		—		—		—		—		—		30		—			30
Net loss		—		—		—		—		—		—		—		—		—		—		(6,622	)		(6,622	)
Balance at September 30, 2019		2,712,960	$	1,460		31,499,040	$	30,729		26,321,313	$	45,575		702,510	$	1	$	5,575	$	30	$	(47,503	)	$	(41,897	)

	CONVERTIBLE PREFERRED STOCK																		COMMON
	SERIES SEED $0.001 PAR VALUE						SERIES A $0.001 PAR VALUE						SERIES B $0.001 PAR VALUE						STOCK $0.001 PAR VALUE				ADDITIONAL PAID-IN			ACCUMULATED OTHER COMPREHENSIVE			ACCUMULATED			TOTAL STOCKHOLDERS’ EQUITY
	SHARES			AMOUNT			SHARES			AMOUNT			SHARES			AMOUNT			SHARES		AMOUNT		CAPITAL			INCOME (LOSS)			DEFICIT			(DEFICIT)
Balance at December 31, 2019		2,712,960		$	1,460			31,499,040		$	30,729			26,321,313		$	45,575			702,510	$	1	$	5,872		$	32		$	(54,753	)	$	(48,848	)
Issuance of Series B convertible preferred stock, net of issuance costs of $20 and beneficial conversion charge		—			—			—			—			9,845,348			9,271			—		—		7,858			—			—			7,858
Accretion of Series B converted preferred stock		—			—			—			—			—			7,858			—		—		(7,858	)		—			—			(7,858	)
Conversion of convertible preferred stock into common stock		(2,712,960	)		(1,460	)		(31,499,040	)		(30,729	)		(36,166,661	)		(62,704	)		11,172,955		11		94,882			—			—			94,893
Initial public offering, net of underwriting discounts, commissions and offering costs of $3,885		—			—			—			—			—			—			4,700,000		5		66,047			—			—			66,052
Stock-based compensation expense		—			—			—			—			—			—			—		—		360			—			—			360
Unrealized loss on investments		—			—			—			—			—			—			—		—		—			(48	)		—			(48	)
Net loss		—			—			—			—			—			—			—		—		—			—			(7,215	)		(7,215	)
Balance at March 31, 2020		—		$	—			—		$	—			—		$	—			16,575,465	$	17	$	167,161		$	(16	)	$	(61,968	)	$	105,194
Initial public offering, net of underwriting discounts, commissions and offering costs of $17		—			—			—			—			—			—			705,000		1		10,473			—			—			10,474
Exercise of stock options		—			—			—			—			—			—			44,271		—		218			—			—			218
Stock-based compensation expense		—			—			—			—			—			—			—		—		550			—			—			550
Unrealized gain on investments		—			—			—			—			—			—			—		—		—			64			—			64
Net loss		—			—			—			—			—			—			—		—		—			—			(10,204	)		(10,204	)
Balance at June 30, 2020		—		$	—			—		$	—			—		$	—			17,324,736	$	18	$	178,402		$	48		$	(72,172	)	$	106,296
Exercise of stock options		—			—			—			—			—			—			52,331		—		207			—			—			207
Stock-based compensation expense		—			—			—			—			—			—			—		—		642			—			—			642
Unrealized loss on investments		—			—			—			—			—			—			—		—		—			(24	)		—			(24	)
Net loss		—			—			—			—			—			—			—		—		—			—			(12,423	)