Edgewise Therapeutics Inc

Previous wording

Since our inception in 2017, we have been drawing on our deep expertise in muscle physiology to drive the next generation of first-in-class therapeutics to address a variety of severe muscle diseases. We are advancing two clinical-stage programs and a number of preclinical programs. Sevasemten (EDG-5506) is an orally administered skeletal myosin inhibitor in a pivotal stage trial for Becker muscular dystrophy as well as ongoing phase 2 programs in Duchenne muscular dystrophy. EDG-7500, currently in a Phase 1 and Phase 2 trial, is a novel cardiac sarcomere modulator for the treatment of hypertrophic cardiomyopathy (HCM) and other disorders of diastolic dysfunction. We also continue to advance our preclinical pipeline, including characterization of novel cardiometabolic targets. From this foundation and our dedication to muscle physiology and function, we will build a leading global biopharmaceutical company driving advances to improve the lives of people suffering from muscle diseases.

Current wording

Since our inception in 2017, we have been drawing on our deep expertise in muscle physiology and small molecule drug discovery to drive the next generation of first-in-class therapeutics to address a variety of severe muscle diseases. We are advancing two clinical-stage programs in muscular dystrophies and severe cardiac diseases. Sevasemten (EDG-5506) is an orally administered skeletal myosin inhibitor in a pivotal stage trial for Becker muscular dystrophy as well as ongoing Phase 2 programs in Duchenne muscular dystrophy. EDG-7500, currently in a Phase 2 trial, is a novel cardiac sarcomere modulator for the treatment of hypertrophic cardiomyopathy (HCM) and other disorders of diastolic dysfunction. We also continue to advance our preclinical pipeline, including characterization of novel cardiometabolic targets. From this foundation and our dedication to muscle physiology and function, we will build a leading global biopharmaceutical company driving advances to improve the lives of people suffering from muscle diseases.

Previous wording

As a clinical-stage biopharmaceutical company, we are focused on the discovery, development and commercialization of innovative treatments for severe muscle diseases for which there is significant unmet medical need. Guided by our holistic drug discovery approach to targeting the muscle as an organ, we have combined our foundational expertise in muscle biology and small molecule engineering to build our proprietary, muscle focused drug discovery platform. Our platform utilizes custom-built high throughput and translatable systems that measure integrated muscle function in whole organ extracts to identify small molecule precision medicines regulating key proteins in muscle tissue, initially focused on addressing rare neuromuscular and cardiac diseases. We have developed and characterized a library of novel sarcomere modulators exhibiting a broad range of pharmacological and pharmacokinetic (PK) properties regulating disease-related muscle biology.

Current wording

As a clinical-stage biopharmaceutical company, we are focused on the discovery, development and commercialization of innovative treatments for severe muscle diseases for which there is significant unmet medical need. Guided by our holistic drug discovery approach to targeting the muscle as an organ, we have combined our foundational expertise in muscle biology and small molecule engineering to build our proprietary, muscle focused drug discovery platform. Our platform utilizes custom-built high throughput and translatable systems that measure integrated muscle function in whole organ extracts to identify small molecule precision medicines regulating key proteins in muscle tissue, initially focused on addressing rare neuromuscular and cardiac diseases. We have developed and characterized a library of novel sarcomere modulators exhibiting a broad range of pharmacological and pharmacokinetic properties regulating disease-related muscle biology.

Previous wording

We have incurred significant losses since the commencement of our operations. Our net losses were $28.5 million and $22.8 million for the three months ended March 31, 2024 and 2023, respectively, and we expect to continue to incur significant losses for the foreseeable future as we advance our product candidates through preclinical development and clinical trials and seek regulatory approval of our product candidates. Our net losses may fluctuate significantly from period to period, depending on the timing of and expenditures on our planned research and development activities.

Current wording

We have incurred significant losses since the commencement of our operations. Our net losses were $31.5 million and $60.0 million for the three and six months ended June 30, 2024, respectively and $21.5 million and $44.3 million for the three and six months ended June 30, 2023, respectively, and we expect to continue to incur significant losses for the foreseeable future as we advance our product candidates through preclinical development and clinical trials and seek regulatory approval of our product candidates. Our net losses may fluctuate significantly from period to period, depending on the timing of and expenditures on our planned research and development activities.

Previous wording

As of March 31, 2024, we had an accumulated deficit of $273.3 million. To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock. From inception through March 31, 2024, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under an “at the market offering” program (the ATM Program), and underwritten registered direct offering have generated net proceeds of $606.6 million. We believe that our existing cash and cash equivalents and marketable securities of $532.8 million will enable us to fund our planned operating expenses and capital expenditure requirements through at least the next 12 months.

Current wording

As of June 30, 2024, we had an accumulated deficit of $304.8 million. To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock. From inception through June 30, 2024, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under an “at the market offering” program (the ATM Program), and underwritten registered direct offering have generated net proceeds of $606.6 million. We believe that our existing cash and cash equivalents and marketable securities of $511.8 million will enable us to fund our planned operating expenses and capital expenditure requirements through at least the next 12 months.

Previous wording

We are monitoring macroeconomic and geopolitical developments, such as inflation, instability in the banking and financial services sector, tightening of the credit markets, international conflicts, public health pandemics, cybersecurity and sanctions so that the Company can be prepared to react to new developments as they arise.

Current wording

We are monitoring macroeconomic and geopolitical developments, such as inflation, instability in the banking and financial services sector, tightening of the credit markets, the upcoming U.S. presidential election, international conflicts, public health pandemics, cybersecurity and sanctions so that the Company can be prepared to react to new developments as they arise.

Previous wording

Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages, primarily due to the increased size and duration of later-stage clinical trials. We are currently conducting four Phase 2 clinical trials for sevasemten (CANYON, LYNX, FOX and DUNE), a potentially registrational, or pivotal cohort in individuals with Becker (GRAND CANYON), and a Phase 1 and Phase 2 study for EDG-7500 (CIRRUS-HCM). As a result, we expect that our research and development expenses will increase substantially over the next several years as we advance sevasemten, EDG-7500, a product from our EDG-003 cardiometabolic discovery program through clinical trials and additional product candidates; continue to develop our proprietary drug discovery platform; continue to discover and develop additional product candidates; and hire additional personnel.

Current wording

Product candidates in later stages of clinical development generally have higher development costs than those in earlier stages, primarily due to the increased size and duration of later-stage clinical trials. We are currently conducting four Phase 2 clinical trials for sevasemten (CANYON, LYNX, FOX and DUNE), a potentially registrational, or pivotal cohort in individuals with Becker (GRAND CANYON), and a Phase 2 study for EDG-7500 (CIRRUS-HCM). As a result, we expect that our research and development expenses will increase substantially over the next several years as we advance sevasemten, EDG-7500, a product from our EDG-003 cardiometabolic discovery program through clinical trials and additional product candidates; continue to develop our proprietary drug discovery platform; continue to discover and develop additional product candidates; and hire additional personnel.

Previous wording

Research and development expenses were $27.7 million and $19.9 million for the three months ended March 31, 2024 and 2023, respectively. The increase of $7.8 million was driven by an increase of $4.9 million in sevasemten clinical program expenses, which was primarily due to increased clinical trial activity in our GRAND CANYON, CANYON, and LYNX studies from site activations and patient enrollment, costs incurred in connection with our MESA and FOX trials which were not active during the comparable period in 2023, and higher product candidate manufacturing costs to support current and future trials. EDG-7500 clinical program expenses of $4.0 million are now shown separately in the above table due to advancing into a Phase 1 trial in the third quarter of 2023. These expenses include the trial costs as well as manufacturing costs to support current and future trials and nonclinical costs during the three months ended March 31, 2024. Internal costs increased $2.8 million, primarily related to personnel costs and stock-based compensation resulting from increased employee headcount to support the growth of our research and development programs. Discovery and preclinical expenses decreased $3.9 million primarily due to EDG-7500 costs, now shown separately, which were a significant portion of the 2023 period’s discovery and preclinical expenses along with other costs from the EDG-003 program.

Current wording

Research and development expenses were $30.7 million and $19.6 million for the three months ended June 30, 2024 and 2023, respectively. The increase of $11.1 million was driven by an increase of $5.1 million in sevasemten clinical program expenses, which was primarily due to increased clinical trial activity in our LYNX trial from site activations and patient enrollment and costs incurred in connection with our GRAND CANYON, MESA, and FOX trials which were not active during the comparable period in 2023. EDG-7500 clinical program expenses of $5.1 million are now shown separately in the above table due to advancing into a clinical trial in the third quarter of 2023. These expenses include the trial costs as well as manufacturing costs to support current and future trials and nonclinical costs during the three months ended June 30, 2024. Internal costs increased $2.3 million, primarily related to personnel costs and stock-based compensation resulting from increased employee headcount to support the growth of our research and development programs. Discovery and preclinical expenses decreased $1.4 million as a result of EDG-7500 costs, now shown separately, which were a significant portion of the 2023 period’s discovery and preclinical expenses along with other costs from our EDG-003 program.

Previous wording

General and administrative expenses were $7.1 million and $5.8 million for the three months ended March 31, 2024 and 2023, respectively. The increase of $1.2 million was primarily due to $1.0 million in increased personnel-related costs from increased headcount and stock-based compensation and $0.2 million in increased professional and consulting costs and other administrative costs.

Current wording

General and administrative expenses were $7.4 million and $5.8 million for the three months ended June 30, 2024 and 2023, respectively. The increase of $1.6 million was primarily due to $1.1 million in increased personnel-related costs from increased headcount and stock-based compensation and $0.5 million in increased professional and consulting costs and other administrative costs.

Previous wording

Interest income was $6.2 million and $2.9 million for the three months ended March 31, 2024 and 2023, respectively. The increase of $3.4 million was primarily due to higher balances and interest rates on our marketable securities during the three months ended March 31, 2024, as compared to the three months ended March 31, 2023.

Current wording

Interest income was $6.6 million and $3.9 million for the three months ended June 30, 2024 and 2023, respectively. The increase of $2.7 million was primarily due to higher balances and interest rates on our marketable securities during the three months ended June 30, 2024 as compared to the three months ended June 30, 2023.

Previous wording

Since our inception, we have not generated any revenue and have incurred significant operating losses and negative cash flows from our operations. To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock. From inception through March 31, 2024, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under an “at the market offering” program (the ATM Program), and underwritten registered direct offering have generated net proceeds of $606.6 million. As of March 31, 2024, we had cash, cash equivalents and marketable securities in the amount of $532.8 million.

Current wording

Since our inception, we have not generated any revenue and have incurred significant operating losses and negative cash flows from our operations. To date, we have financed our operations primarily through private placements of convertible preferred stock and public offerings of our common stock. From inception through June 30, 2024, these private placements have provided gross proceeds of $160.7 million, and the initial public offering, follow-on public offering, issuance of our common stock under an “at the market offering” program (the ATM Program), and underwritten registered direct offering have generated net proceeds of $606.6 million. As of June 30, 2024, we had cash, cash equivalents and marketable securities in the amount of $511.8 million.

Previous wording

Cash used in operating activities during the three months ended March 31, 2023 was primarily driven by our net loss for the period of $22.8 million, and was also impacted by changes in operating assets and liabilities which increased net working capital by $2.0 million. Cash used in operating activities was reduced by non-cash charges of $2.0 million relating to stock-based compensation expense of $3.8 million, amortization of premium and accretion of discounts, net on marketable securities of $2.1 million, depreciation of $0.2 million and amortization of right-of-use asset of $46,000.

Current wording

Cash used in operating activities during the six months ended June 30, 2024 was primarily driven by our net loss for the period of $60.0 million, and was also impacted by changes in operating assets and liabilities which decreased net working capital by $0.9 million. Cash used in operating activities was reduced by non-cash charges of $4.5 million relating to stock-based compensation expense of $10.1 million, amortization of premium and accretion of discounts, net on marketable securities of $6.7 million, depreciation of $1.0 million and amortization of right-of-use asset of $0.1 million.

Previous wording

Cash used in operating activities during the three months ended March 31, 2024 was primarily driven by our net loss for the period of $28.5 million, and was also impacted by changes in operating assets and liabilities which increased net working capital by $2.3 million. Cash used in operating activities was reduced by non-cash charges of $2.2 million relating to stock-based compensation expense of $4.9 million, amortization of premium and accretion of discounts, net on marketable securities of $3.2 million, depreciation of $0.5 million and amortization of right-of-use asset of $0.1 million.

Current wording

Cash used in operating activities during the six months ended June 30, 2023 was primarily driven by our net loss for the period of $44.3 million, and was also impacted by changes in operating assets and liabilities which increased net working capital by $2.3 million. Cash used in operating activities was reduced by non-cash charges of $3.6 million relating to stock-based compensation expense of $7.8 million, amortization of premium and accretion of discounts, net on marketable securities of $5.0 million, depreciation of $0.6 million and amortization of right-of-use asset of $0.1 million.

Previous wording

Cash used in investing activities during the three months ended March 31,2024 amounted to $268.3 million, which was due to $327.6 million in purchases of marketable securities and $0.1 million for purchases of equipment, which was partially offset by $58.7 million in maturities of marketable securities and $0.9 million in sales of marketable securities.

Current wording

Cash used in investing activities during the six months ended June 30, 2024 amounted to $230.9 million, which was due to $368.6 million in purchases of marketable securities and $0.5 million for purchases of equipment, which was partially offset by $136.4 million in maturities of marketable securities and $1.8 million in sales of marketable securities.

Previous wording

Cash provided by investing activities during the three months ended March 31, 2023 amounted to $49.0 million, which was due to $69.8 million in maturities of marketable securities and $0.6 million in sales of marketable securities, which was partially offset by $17.0 million in purchases of marketable securities and $4.4 million for purchases of equipment.

Current wording

Cash provided by investing activities during the six months ended June 30, 2023 amounted to $52.5 million, which was due to $183.9 million in maturities of marketable securities and $5.1 million in sales of marketable securities, which was partially offset by $131.4 million in purchases of marketable securities and $5.1 million for purchases of equipment.

Previous wording

Cash provided by financing activities during the three months ended March 31, 2024 was $241.1 million, which was due to cash proceeds of $7.0 million from the ATM Program, $240.0 million from the underwritten registered direct offering, and $1.9 million in proceeds from the issuance of common stock upon exercise of stock options, which was partially offset by $7.8 million for the payment of underwriting commissions and offering costs.

Current wording

Cash provided by financing activities during the six months ended June 30, 2024 was $243.0 million, which was due to cash proceeds of $7.0 million from the ATM Program, $240.0 million from the underwritten registered direct offering, $3.5 million in proceeds from the issuance of common stock upon exercise of stock options, and $0.4 million in proceeds from the employee stock purchase plan, which was partially offset by $7.9 million for the payment of underwriting commissions and offering costs.

Previous wording

Cash provided by financing activities during the three months ended March 31, 2023 was $21,000, which was due to cash proceeds from the issuance of common stock upon the exercise of stock options.

Current wording

Cash provided by financing activities during the six months ended June 30, 2023 was $0.4 million, which was due to cash proceeds of $52,000 from the issuance of common stock upon the exercise of stock options and $0.3 million in proceeds from the employee stock purchase plan.

Previous wording

connection with our ongoing activities, particularly as we continue the development of and seek regulatory approvals for our product candidates and begin to commercialize any approved products. We are subject to all of the risks incident in the development of new products, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may harm our business. In addition, we expect to continue to incur additional costs associated with operating as a public company. Our expenses will also increase if, and as, we:

Current wording

We will continue to require substantial additional capital to develop our product candidates and fund operations for the foreseeable future. On May 10, 2024, we filed an automatic shelf registration statement on Form S-3ASR that allows us to undertake various equity and debt offerings and entered into the Leerink Sales Agreement under which we may offer and sell shares of common stock, having aggregate sales proceeds of up to $175,000,000 from time to time, through the Leerink ATM. We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the development of and seek regulatory approvals for our product candidates and begin to commercialize any approved products. We are subject to all of the risks incident in the development of new products, and we may encounter unforeseen expenses, difficulties, complications, delays and other unknown factors that may harm our business. In addition, we expect to continue to incur additional costs associated with operating as a public company. Our expenses will also increase if, and as, we:

Previous wording

We do not currently have material any long-term capital requirements other than what will be required to fund operations for the foreseeable future and the amounts disclosed on the contractual obligations and commitments section below. In order to complete the process of obtaining regulatory approval for our product candidates and to build the sales, marketing and distribution infrastructure that we believe will be necessary to commercialize our product candidates, if approved, we will require substantial additional funding.

Current wording

We do not currently have any long-term material capital requirements other than what will be required to fund operations for the foreseeable future and the amounts disclosed on the contractual obligations and commitments section below. In order to complete the process of obtaining regulatory approval for our product candidates and to build the

Previous wording

Our long-term cash requirements as of March 31, 2024 includes our lease obligations. In January 2022, we entered into a lease agreement for approximately 18,614 square feet of office and laboratory space in Boulder, Colorado which includes escalating rent payments and an 8.2 year term, plus our share of operating expenses. In February 2023, the lease was modified to occupy an additional 9,624 square feet of office space, with aggregate payments of approximately $1.5 million over the initial 7.3 year term, plus our share of operating expenses. As of March 31, 2024 our total operating lease liability balance is $5.2 million, of which $1.0 million is a current liability.

Current wording

Our long-term cash requirements as of June 30, 2024 includes our lease obligations. In January 2022, we entered into a lease agreement for approximately 18,614 square feet of office and laboratory space in Boulder, Colorado which includes escalating rent payments and an 8.2 year term, plus our share of operating expenses. In February 2023, the lease was modified to occupy an additional 9,624 square feet of office space, with aggregate payments of approximately $1.5 million over the initial 7.3 year term, plus our share of operating expenses. As of June 30, 2024 our total operating lease liability balance is $5.0 million, of which $1.0 million is a current liability.

Previous wording

Our critical accounting policies are described in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” in our Annual Report on Form 10-K filed with the SEC on February 22, 2024 and the notes to the financial statements appearing elsewhere in this Quarterly Report on Form 10-Q. During the three months ended March 31, 2024, there were no material changes to our critical accounting estimates from those discussed in our Annual Report on Form 10-K filed on February 22, 2024.

Current wording

Our critical accounting policies are described in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” in our Annual Report on Form 10-K filed with the SEC on February 22, 2024 and the notes to the financial statements appearing elsewhere in this Quarterly Report on Form 10-Q. During the three and six months ended June 30, 2024, there were no material changes to our critical accounting estimates from those discussed in our Annual Report on Form 10-K filed on February 22, 2024.

Previous wording

Section 107 of The Jumpstart Our Business Startups Act of 2012 (JOBS Act) permits an “emerging growth company” such as us to take advantage of an extended transition time to comply with new or revised accounting standards as applicable to public companies. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this extended transition period and, as a result, we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for private companies.

Current wording

standards as applicable to public companies. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this extended transition period and, as a result, we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for private companies.

Previous wording

We will remain an emerging growth company until the earliest to occur of: (1) the last day of the fiscal year in which we have more than $1.07 billion in annual revenue; (2) the date we qualify as a “large accelerated filer,” with at least $700 million of equity securities held by non-affiliates; (3) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period; and (4) the last day of the fiscal year ending after the fifth anniversary of our initial public offering.

Current wording

We will remain an emerging growth company until December 31, 2024.