HOOKIPA Pharma(HOOK) - 2024 Q3 - Quarterly Report

Financial Performance - The company reported a net loss of $13.8 million and$18.6 million for the three and nine months ended September 30, 2024, respectively, with an accumulated deficit of $387.8 million [151]. - The net loss for the three months ended September 30, 2024, was$13.8 million, an improvement of $5.2 million compared to a net loss of$19.1 million in the same period of 2023 [200]. - The net loss for the nine months ended September 30, 2024, was $18.6 million, compared to a net loss of$56.8 million for the same period in 2023 [229][230]. - The accumulated deficit as of September 30, 2024, was $387.8 million, with expectations of continued significant losses for the foreseeable future [218]. - The company does not expect positive cash flows from operations in the foreseeable future and anticipates incurring net operating losses for at least the next several years [214]. - Management has concluded that substantial doubt exists about the company's ability to continue as a going concern for at least 12 months from the issuance date of the financial statements [216]. Revenue and Income - Revenue from collaboration and licensing was$4.7 million for the three months ended September 30, 2024, down from $6.9 million in the same period of 2023, representing a decrease of approximately 31.6$42.6 million from $12.7 million in 2023, marking an increase of approximately 234.6$36.4 million in revenue related to the terminated Roche Collaboration Agreement during the nine months ended September 30, 2024 [190]. - Other income for the three months ended September 30, 2024, was $1.8 million, compared to other expenses of$0.8 million for the same period in 2023, primarily due to exchange rate differences [205]. - For the nine months ended September 30, 2024, other income was $1.3 million, compared to other expenses of$1.0 million for the same period in 2023, also attributed to exchange rate differences [206]. Expenses - Research and development expenses for the three months ended September 30, 2024, totaled $15.6 million, compared to$24.6 million for the same period in 2023 [168]. - Total research and development expenses for the nine months ended September 30, 2024, were $55.5 million, compared to$65.3 million for the same period in 2023 [168]. - The company expects research and development expenses to increase substantially as it advances existing and future product candidates through clinical trials [165]. - General and administrative expenses increased to $6.7 million for the three months ended September 30, 2024, compared to$4.9 million in 2023, an increase of approximately 36.7% [195]. - Restructuring expenses for the three months ended September 30, 2024, were $0.9 million, with$0.8 million attributed to severance and other personnel costs [198]. - The company has established a full valuation allowance for deferred tax assets as of September 30, 2024, due to uncertainty in realizing benefits [180]. Cash and Funding - The company has cash, cash equivalents, and restricted cash of $60.0 million as of September 30, 2024 [147]. - Cash used in operating activities for the nine months ended September 30, 2024, was$56.0 million, an increase from $46.3 million in the same period of 2023 [229][230]. - Cash used in investing activities decreased to$0.2 million in the nine months ended September 30, 2024, from $3.7 million in the same period of 2023 [231][232]. - Cash used in financing activities was$1.3 million for the nine months ended September 30, 2024, compared to cash provided of $44.4 million in the same period of 2023 [233][234]. - The company anticipates requiring additional funding to support clinical and preclinical development, regulatory approvals, and operational expansions [219]. - The company has no committed external source of funds for its development efforts and expects to finance future cash needs through a combination of equity offerings, debt financings, and collaborations [225]. Research and Development - The eseba-vec program for HPV16+ head and neck cancers showed an overall response rate (ORR) of 55.0$185.0 million in milestone payments, plus tiered royalties [142]. - The company regained full control of the HB-700 program after Roche terminated their collaboration agreement, receiving a non-refundable upfront payment of $25.0 million and milestone payments of$20.0 million [141]. - The company regained full control of the intellectual property portfolio associated with the terminated Roche Collaboration Agreement effective April 25, 2024 [158]. - The company recognized $0.6 million in cost reimbursements for research and development activities related to a first human trial [160]. Market Risks - The company is subject to market risks from changes in interest rates, foreign exchange rates, and inflation, which may impact financial performance [241][243]. - The company anticipates that a significant portion of its expenses will continue to be denominated in euros, exposing it to foreign currency risk [241].