Liquidia Corp
For the period ended Sep 30, 2024. Filed Nov 13, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Nov 13, 2024
LQDA$44.40-0.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-07.
0001558370-24-011206
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-13.
0001558370-24-015433
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 99 previous paragraphs and 108 current paragraphs.
60 unchanged; 33 reworded; 11 added; 1 removed; 5 previous and 4 current paragraphs rearranged.
Tables are not compared: 23 previous and 23 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
Recent Events
Current report
In September 2024, we entered into the Fifth Amendment to the RIFA pursuant to which HCR funded an additional $32.5 million on September 12, 2024, for total funding of $100 million. Additionally, payments due under the RIFA were amended such that the one-time fixed payment previously due in July 2025 is now due in equal payments in January and July 2026. See Note 12 for further information.
Current report
On September 12, 2024, we sold shares of our common stock in an underwritten registered public offering for net proceeds of approximately $53.7 million and sold shares of our common stock for net proceeds of approximately $10.0 million in a private offering.
Current report
On October 2, 2024, we and Pharmosa entered into a First Amendment to the Pharmosa License Agreement (the “First Amendment”) which, among other things, expands our licensed territory beyond North America to include key markets in Europe, Japan and elsewhere.
Current report
Concurrently with the execution of the First Amendment we and Pharmosa also entered into a Device License Agreement (the “Device License Agreement”). Pursuant to the terms of the Device License Agreement, Pharmosa will provide (i) an exclusive license to Liquidia Technologies for the right to develop, manufacture, use and commercialize Pharmosa’s next-generation smart-technology nebulizers (the “Device”) for use with L606 in most countries (subject to certain exceptions) (the “Territory”) and (ii) a non-exclusive license to Liquidia Technologies for the right to develop, manufacture and use (but not commercialize) the Device outside of the Territory.
Current report
Liquidity
Current report
Although we expect to continue to generate operating losses for the foreseeable future, we believe that as a result of the recent RIFA funding and net proceeds from the sale of common stock described above, excluding any future YUTREPIA product revenue, our cash and cash equivalents will be sufficient to fund operations, capital expenditures, and RIFA payments and allow us to remain in compliance with our minimum cash covenants pursuant to the RIFA for at least twelve months from the issuance date of these condensed consolidated financial statements. If we have not received full FDA approval and generated sufficient cash from product sales of YUTREPIA or are unable to access additional capital by the date of issuance of our fiscal year 2024 consolidated financial statements, we expect there would be substantial doubt about our ability to continue as a going concern as of that date. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect, which would have a material impact on our operations
Current report
In September 2024, we sold 6,460,674 shares of our common stock in an underwritten registered public offering at an offering price of $8.90 per share (the “2024 Offering”) for gross proceeds of approximately $57.5 million, before deducting offering costs of approximately $3.8 million.
Current report
A fund affiliated with Paul B. Manning, a member of our Board of Directors, participated in the 2024 Offering and purchased shares of common stock in an aggregate amount of approximately $3.0 million at the public offering price per share and on the same terms as the other purchasers in the 2024 Offering.
Current report
Concurrently with the 2024 Offering referenced above, we entered into a common stock purchase agreement with funds managed by Caligan Partners LP (“Caligan”), our largest stockholder, for the sale by us in a private placement of an aggregate of 1,123,595 shares of our common stock at a purchase price of $8.90 per share for gross and net proceeds of approximately $10.0 million (the “Caligan 2024 Private Placement”).
Current report
We expect that, excluding any future YUTREPIA product revenue, our cash and cash equivalents will be sufficient to fund operations, capital expenditures, and RIFA payments and allow us to remain in compliance with our minimum cash covenants pursuant to the RIFA for at least twelve months from the issuance date of these condensed consolidated financial statements. If we have not received full FDA approval and generated sufficient cash from product sales of YUTREPIA or are unable to access additional capital by the date of issuance of our fiscal year 2024 consolidated financial statements, we expect there would be substantial doubt about our ability to continue as a going concern as of that date. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect, which would have a material impact on our operations. See Note 1 to the condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for information regarding our ability to continue as a going concern.
Removed paragraphs (1)
Previous report
Based on current operating plans and excluding any contribution from YUTREPIA product sales or external financing, we will not have sufficient cash and cash equivalents to fund operating expenses and capital requirements and meet our minimum cash covenants beyond one year from the issuance of these condensed consolidated financial statements, and therefore, the Company has concluded that there is substantial doubt about its ability to continue as a going concern. We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we currently expect.
Reworded paragraphs (33)
Previous wording
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to provide information necessary to understand our condensed consolidated financial statements and highlight certain other information which, in the opinion of management, will enhance a reader’s understanding of our financial condition, changes in financial condition and results of operations. In particular, the discussion is intended to provide an analysis of significant trends and material changes in our financial position and the operating results of our business during the three and six months ended June 30, 2024 as compared to the three and six months ended June 30, 2023. Also refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, which includes detailed discussions of various items impacting our business, results of operations and financial condition.
Current wording
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations is intended to provide information necessary to understand our condensed consolidated financial statements and highlight certain other information which, in the opinion of management, will enhance a reader’s understanding of our financial condition, changes in financial condition and results of operations. In particular, the discussion is intended to provide an analysis of significant trends and material changes in our financial position and the operating results of our business during the three and nine months ended September 30, 2024 as compared to the three and nine months ended September 30, 2023. Also refer to our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, which includes detailed discussions of various items impacting our business, results of operations and financial condition.
Previous wording
We are a biopharmaceutical company focused on the development, manufacture, and commercialization of products that address unmet patient needs, with current focus directed towards rare cardiopulmonary diseases such as pulmonary arterial hypertension (“PAH”) and pulmonary hypertension associated with interstitial lung disease (“PH-ILD”). We
Current wording
We are a biopharmaceutical company focused on the development, manufacture, and commercialization of products that address unmet patient needs, with current focus directed towards rare cardiopulmonary diseases such as pulmonary arterial hypertension (“PAH”) and pulmonary hypertension associated with interstitial lung disease (“PH-ILD”). We operate through our wholly owned operating subsidiaries, Liquidia Technologies, Inc. (“Liquidia Technologies”) and Liquidia PAH, LLC (“Liquidia PAH”), formerly known as RareGen, LLC (“RareGen”).
Previous wording
We currently generate revenue pursuant to a promotion agreement between Liquidia PAH and Sandoz Inc. (“Sandoz”), dated as of August 1, 2018, as amended (the “Promotion Agreement”), sharing profit derived from the sale of Sandoz’s substitutable generic treprostinil injection (“Treprostinil Injection”) in the United States. Liquidia PAH has the exclusive rights to conduct commercial activities to encourage the appropriate use of Treprostinil Injection. We employ a targeted sales force calling on physicians and hospital pharmacies involved in the treatment of PAH and PH-ILD in the United States, as well as key stakeholders involved in the distribution and reimbursement of medicines to treat these patients. We established our commercial presence in the field to support Treprostinil Injection and have since expanded our presence to support the launch of YUTREPIA upon final approval, further validating our reputation as a company committed to supporting PAH and PH-ILD patients.
Current wording
We currently generate revenue pursuant to a promotion agreement between Liquidia PAH and Sandoz Inc. (“Sandoz”), dated as of August 1, 2018, as amended (the “Promotion Agreement”), sharing profit derived from the sale of Sandoz’s substitutable generic treprostinil injection (“Treprostinil Injection”) in the United States. Liquidia PAH has the exclusive rights to conduct commercial activities to encourage the appropriate use of Treprostinil Injection. We employ a targeted sales force calling on physicians and hospital pharmacies involved in the treatment of PAH and PH-ILD in the United States, as well as key stakeholders involved in the distribution and reimbursement of medicines to treat these patients. We established our commercial presence in the field to support Treprostinil Injection and have since expanded our presence to support the potential launch of YUTREPIA (treprostinil) inhalation powder (“YUTREPIA”), further validating our reputation as a company committed to supporting PAH and PH-ILD patients.
Previous wording
Our lead product candidate is YUTREPIA for the treatment of PAH and PH-ILD. YUTREPIA is an inhaled dry powder formulation of treprostinil designed with PRINT to improve the therapeutic profile of treprostinil by enhancing deep lung delivery while using a convenient, low effort dry-powder inhaler (“DPI”) and by achieving higher dose levels than the labeled doses of current inhaled therapies. In November 2021, the United States Food and Drug Administration (“FDA”) tentatively approved our New Drug Application (“NDA”) for YUTREPIA for the treatment of PAH. In July 2023, we filed an amendment to our NDA to add PH-ILD to the label for YUTREPIA. We are currently awaiting final action by the FDA with respect to our NDA.
Current wording
Our lead product candidate is YUTREPIA for the treatment of PAH and PH-ILD. YUTREPIA is an inhaled dry powder formulation of treprostinil designed with PRINT to improve the therapeutic profile of treprostinil by enhancing deep lung delivery while using a convenient, low effort dry-powder inhaler (“DPI”) and by achieving higher dose levels than the labeled doses of current inhaled therapies. On August 16, 2024, the United States Food and Drug Administration (“FDA”) (i) granted tentative approval for our New Drug Application (“NDA”) for YUTREPIA for the treatment of PAH and PH-ILD and (ii) simultaneously determined that Tyvaso DPI, approved on May 23, 2022, qualifies for a three-year New Clinical Investigation exclusivity for the chronic use of dry powder formulations of treprostinil for the approved indications. As a result, final approval of YUTREPIA for PAH and PH-ILD is currently delayed until after expiry of the three-year regulatory exclusivity for Tyvaso DPI on May 23, 2025.
Previous wording
We are also developing L606, an investigational, liposomal formulation of treprostinil administered twice-daily with a short-duration next-generation nebulizer, which we licensed from Pharmosa Biopharm. L606 is currently being evaluated in an open-label study in the United States for treatment of PAH and PH-ILD with a planned pivotal study for the treatment of PH-ILD.
Current wording
We are also developing L606, an investigational, liposomal formulation of treprostinil administered twice-daily with a short-duration next-generation nebulizer, which we licensed from Pharmosa Biopharm Inc. (“Pharmosa”). L606 is currently being evaluated in an open-label study in the United States for treatment of PAH and PH-ILD with a planned pivotal study for the treatment of PH-ILD.
Previous wording
Since inception, we have incurred significant operating losses. Our net loss was $68.9 million for the six months ended June 30, 2024 and $78.5 million and $41.0 million for the years ended December 31, 2023 and 2022, respectively. As of June 30, 2024, we had an accumulated deficit of $498.0 million. We expect to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates through clinical trials, seek regulatory approval of such product candidates and pursue commercialization of any approved product candidates. These efforts require significant amounts of capital, adequate personnel and infrastructure, and extensive compliance-reporting capabilities. Even if our development efforts are successful, it is uncertain when, if ever, we will realize significant revenue from product sales. Additionally, the Revenue Interest Financing Agreement with HealthCare Royalty Partners IV, L.P. (“HCR”) dated January 9, 2023, as amended (the “RIFA”) contains fixed quarterly payments and minimum cash covenants that require us to maintain cash and cash equivalents in an amount at least equal to $7.5 million during the calendar year beginning on January 1, 2024 and at least equal to $15.0 million for the remainder of the payment term after the calendar year ended December 31, 2024.
Current wording
Since inception, we have incurred significant operating losses. Our net loss was $92.0 million for the nine months ended September 30, 2024 and $78.5 million and $41.0 million for the years ended December 31, 2023 and 2022, respectively. As of September 30, 2024, we had an accumulated deficit of $521.1 million. We expect to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates through clinical trials, seek regulatory approval of such product candidates and pursue commercialization of any approved product candidates. These efforts require significant amounts of capital, adequate personnel and infrastructure, and extensive compliance-reporting capabilities. Even if our development efforts are successful, it is uncertain when, if ever, we will realize significant revenue from product sales. Additionally, the Revenue Interest Financing Agreement with HealthCare Royalty Partners IV, L.P. (“HCR”) dated January 9, 2023, as amended (the “RIFA”) contains fixed quarterly payments and minimum cash covenants that require us to maintain cash and cash equivalents in an amount at least equal to $7.5 million during the calendar year beginning on January 1, 2024 and at least equal to $15.0 million for the remainder of the payment term after the calendar year ended December 31, 2024.
Previous wording
We primarily generate revenue pursuant to the Promotion Agreement, under which we receive a 50% share in the profit derived from the sale of Treprostinil Injection in the United States. Liquidia PAH has the exclusive rights to conduct commercial activities to encourage the appropriate use of Treprostinil Injection. In May 2021, Liquidia PAH’s manufacturing partner, Chengdu Shifeng Medical Technologies LTD (“Chengdu”) began selling the RG Cartridge, which may be used to supply medications to PAH patients with the CADD-MS 3 pump manufactured by Smiths Medical ASD, Inc. We are aware of shortages of critical components of the CADD-MS 3 pump that have caused the number of CADD-MS 3 infusion pumps available for the subcutaneous administration of Treprostinil Injection to be limited. Due to this limitation in the availability of pumps, specialty pharmacies are not currently placing new patients on to subcutaneous Treprostinil Injection therapy in order to preserve the available pumps for those patients already receiving subcutaneous administration of Treprostinil Injection. In December 2022, we entered into a Device Development and Supply Agreement (the “Pump Development Agreement”) with Mainbridge Health Partners, LLC (“Mainbridge”) and Sandoz. The Pump Development Agreement provides for the cooperation between us, Sandoz and Mainbridge to develop a new pump that is suitable for the subcutaneous administration of Treprostinil Injection. Mainbridge will perform all development, validation and testing activities required for the pump and related consumables in anticipation of submitting a 510(k) clearance application for the pump to the FDA in 2025. Revenue will continue to be impacted or at risk until new components or alternative pumps are available.
Current wording
We primarily generate revenue pursuant to the Promotion Agreement, under which we receive a 50% share in the profit derived from the sale of Treprostinil Injection in the United States. Liquidia PAH has the exclusive rights to conduct commercial activities to encourage the appropriate use of Treprostinil Injection. In May 2021, Liquidia PAH’s manufacturing partner, Chengdu Shifeng Medical Technologies LTD (“Chengdu”) began selling the RG Cartridge, which may be used to supply medications to PAH patients with the CADD-MS 3 pump manufactured by ICU Medical. We are aware of shortages of critical components of the CADD-MS 3 pump that have caused the number of CADD-MS 3 infusion pumps available for the subcutaneous administration of Treprostinil Injection to be limited. Due to this limitation in the availability of pumps, specialty pharmacies are not currently placing new patients on to subcutaneous Treprostinil Injection therapy in order to preserve the available pumps for those patients already receiving subcutaneous
Previous wording
Other income (expense) is comprised of interest income and expense and loss on extinguishment of debt. Interest income consists of interest earned on our cash equivalents. Interest expense consists of interest charges on the revenue interest
Current wording
Other income (expense) is comprised of interest income and expense and loss on extinguishment of debt. Interest income consists of interest earned on our cash equivalents. Interest expense consists of interest charges on the revenue interest financing payable, finance leases and long-term debt. These charges include monthly recurring interest on such obligations in addition to interest accretion and amortization of debt discounts and issuance costs to interest expense.
Previous wording
Three and Six Months Ended June 30, 2024 compared with the Three and Six Months Ended June 30, 2023
Current wording
Three and Nine Months Ended September 30, 2024 compared with the Three and Nine Months Ended September 30, 2023
Previous wording
The following table summarizes the results of our operations for the three and six months ended June 30, 2024 and 2023, together with the changes in those items in dollars and as a percentage (in thousands, except for percentages):
Current wording
The following table summarizes the results of our operations for the three and nine months ended September 30, 2024 and 2023, together with the changes in those items in dollars and as a percentage (in thousands, except for percentages):
Previous wording
Revenue was $3.7 million for the three months ended June 30, 2024, compared to $4.8 million for the three months ended June 30, 2023. Revenue related primarily to the Promotion Agreement. The decrease of $1.1 million was primarily due tothe impact of lower sales quantities in the current year as compared to the same period in the prior year.
Current wording
Revenue was $4.4 million for the three months ended September 30, 2024, compared to $3.7 million for the three months ended September 30, 2023. Revenue related primarily to the Promotion Agreement. The increase of $0.7 million was primarily due tothe impact of higher sales quantities in the current period as compared to the same period in the prior year.
Previous wording
Revenue was $6.6 million for the six months ended June 30, 2024, compared to $9.3 million for the six months ended June 30, 2023. Revenue related primarily tothe Promotion Agreement. The decrease of $2.7 million was primarily due to the impact of lower sales quantities in the current year as compared to the same period in the prior year.
Current wording
Revenue was $11.1 million for the nine months ended September 30, 2024, compared to $13.0 million for the nine months ended September 30, 2023. Revenue related primarily tothe Promotion Agreement. The decrease of $1.9 million was primarily due to the impact of unfavorable gross-to-net returns adjustments recorded in the current year.
Previous wording
Cost of revenue was $1.5 million for the three months ended June 30, 2024, compared to $0.7 million for the three months ended June 30, 2023. Cost of revenue related to the Promotion Agreement as noted above. The increase from the prior year was primarily due to our sales force expansion during the fourth quarter of 2023.
Current wording
Cost of revenue was $1.6 million for the three months ended September 30, 2024, compared to $0.6 million for the three months ended September 30, 2023. Cost of revenue related to the Promotion Agreement as noted above. The increase from the prior year was primarily due to our sales force expansion during the fourth quarter of 2023.
Previous wording
Cost of revenue was $3.0 million for the six months ended June 30, 2024, compared to $1.3 million for the six months ended June 30, 2023. Cost of revenue related to the Promotion Agreement as noted above. The increase from the prior year was primarily due to our sales force expansion during the fourth quarter of 2023.
Current wording
Cost of revenue was $4.5 million for the nine months ended September 30, 2024, compared to $1.9 million for the nine months ended September 30, 2023. Cost of revenue related to the Promotion Agreement as noted above. The increase from the prior year was primarily due to our sales force expansion during the fourth quarter of 2023.
Previous wording
Research and development expenses were $19.5 million for the six months ended June 30, 2024, compared to $23.0 million for the six months ended June 30, 2023. The decrease of $3.5 million or 15% was primarily due to a $10.0 million upfront license fee due to Pharmosa for the exclusive license in North America to develop and commercialize L606 recorded during the three months ended June 30, 2023. This decrease was offset by a $3.5 million increase in personnel expenses (including stock-based compensation) related to increased headcount and a $3.1 million increase in clinical expenses related to our L606 program.
Current wording
Research and development expenses were $11.9 million for the three months ended September 30, 2024, compared to $7.4 million for the three months ended September 30, 2023. The increase of $4.5 million or 60% was primarily due to a $2.1 million increase in personnel expenses (including stock-based compensation) related to increased headcount, a $1.3 million increase in clinical expenses related to our L606 program, and a $2.5 million increase in expenses related to YUTREPIA research and development activities, including the ASCENT trial, offset by $1.5 million lower commercial manufacturing expenses reflecting the impact of expensing YUTREPIA inventory costs in the prior year.
Previous wording
Research and development expenses were $9.4 million for the three months ended June 30, 2024, compared to $17.7 million for the three months ended June 30,2023. The decrease of $8.3 million or 47% was primarily due to a $10.0 million upfront license fee due to Pharmosa for the exclusive license in North America to develop and commercialize L606 recorded during the three months ended June 30, 2023. Additionally, there was a $1.4 million decrease in expenses related to our YUTREPIA program driven by expensing prelaunch inventory costs in the prior year. These decreases were offset by a $1.7 million increase in clinical expenses related to our L606 program and a $1.5 million increase in personnel expenses (including stock-based compensation) related to increased headcount.
Current wording
Research and development expenses were $31.4 million for the nine months ended September 30, 2024, compared to $30.4 million for the nine months ended September 30, 2023. The increase of $1.0 million or 3% was primarily due to a $5.4 million increase in personnel expenses (including stock-based compensation) related to increased headcount, a $4.6 million increase in clinical expenses related to our L606 program, and a $5.2 million increase in expenses related to YUTREPIA research and development activities, including the ASCENT trial, offset by (i) $4.3 million lower commercial manufacturing expenses reflecting the impact of expensing YUTREPIA inventory costs in the prior year and (ii) a $10.0 million upfront license fee due to Pharmosa for the exclusive license in North America to develop and commercialize L606 recorded during the three months ended June 30, 2023.
Previous wording
General and administrative expenses were $19.9 million for the three months ended June 30, 2024, compared to $9.2 million for the three months ended June 30, 2023. The increase of $10.7 million or 116% was primarily due toa $6.3 million increase in personnel expenses (including stock-based compensation) driven by higher headcount and expansion of our sales force in the fourth quarter of 2023, a $2.2 million increase in commercial and consulting expenses in preparation for the potential commercialization of YUTREPIA, and a $0.9 million increase in legal fees related to ourongoing YUTREPIA-related litigation.
Current wording
General and administrative expenses were $20.2 million for the three months ended September 30, 2024, compared to $10.6 million for the three months ended September 30, 2023. The increase of $9.6 million or 91% was primarily due toa $6.7 million increase in personnel expenses (including stock-based compensation) driven by higher headcount and expansion of our sales force in the fourth quarter of 2023, a $1.5 million increase in legal fees related to ourongoing YUTREPIA-related litigation and a $0.5 million increase in commercial expenses in preparation for the potential commercialization of YUTREPIA.
Previous wording
General and administrative expenses were $40.2 million for the six months ended June 30, 2024, compared to $17.0 million for the six months ended June 30, 2023. The increase of $23.2 million or 136% was primarily due toa $12.2 million increase in personnel expenses (including stock-based compensation) driven by higher headcount and expansion of our sales force in the fourth quarter of 2023, a $4.5 million increase in commercial and consulting expenses in preparation for the potential commercialization of YUTREPIA, anda $4.0 million increase in legal fees related to ourongoing YUTREPIA-related litigation.
Current wording
General and administrative expenses were $60.4 million for the nine months ended September 30, 2024, compared to $27.6 million for the nine months ended September 30, 2023. The increase of $32.8 million or 119% was primarily due toa $18.9 million increase in personnel expenses (including stock-based compensation) driven by higher headcount and expansion of our sales force in the fourth quarter of 2023, a $5.5 million increase in legal fees related to ourongoing YUTREPIA-related litigation, and a $6.0 million increase in commercial expenses in preparation for the potential commercialization of YUTREPIA.
Previous wording
Total other expense, net was $0.7 million for both the three months ended June 30, 2024 and 2023. There was a $1.2 million increase in interest expense attributable to the higher borrowings under the RIFA as compared to the prior year and a $1.1 million increase in interest income attributable to higher money market balances.
Current wording
Total other income, net was $6.0 million for the three months ended September 30, 2024, compared with total other expense, net of $0.9 million for the three months ended September 30,2023. The variance of $6.9 million was primarily driven by a $7.2 million gain on extinguishment of debt resulting from the Fifth Amendment to the RIFA, which was executed in September 2024. Additionally, there was a $1.2 million increase in interest expense attributable to the higher borrowings under the RIFA as compared to the prior year and a $1.0 million increase in interest income attributable to higher money market balances.
Previous wording
Total other expense, net was $12.9 million for the six months ended June 30, 2024, compared with $3.2 million for the six months ended June 30, 2023. The increase of $9.7 million was primarily driven by a $9.2 million increase in loss on extinguishment of debt resulting from the Fourth Amendment to the RIFA, which was executed in January 2024, and a $2.6 million increase in interest expense attributable to the higher borrowings under the RIFA compared to the prior year. These increases were offset by a $2.1 million increase in interest income attributable to higher money market balances.
Current wording
Total other expense, net was $6.8 million for the nine months ended September 30, 2024, compared with $4.1 million for the nine months ended September 30, 2023. The increase of $2.7 million was primarily driven by a $2.0 million increase in the net loss on extinguishment of debt resulting from the Fourth and Fifth Amendments to the RIFA, which were executed in January 2024 and September 2024, respectively. Additionally, there was a $3.8 million increase in interest expense attributable to the higher borrowings under the RIFA compared to the prior year and a $3.0 million increase in interest income attributable to higher money market balances.
Previous wording
We have financed our growth and operations through a combination of funds generated from revenues, the issuance of convertible preferred stock and common stock, bank borrowings, the issuance of convertible notes, and revenue interest financing. Our principal uses of cash have been for working capital requirements and capital expenditures. As of June 30, 2024 and December 31, 2023, we had cash and cash equivalents of $133.1 million and $83.7 million,
Current wording
We have financed our growth and operations through a combination of funds generated from revenues, the issuance of convertible preferred stock and common stock, bank borrowings, the issuance of convertible notes, and revenue interest financing. Our principal uses of cash have been for working capital requirements and capital expenditures. As of September 30, 2024 and December 31, 2023, we had cash and cash equivalents of $204.4 million and $83.7 million, respectively. As of September 30, 2024, we had stockholders’ equity of $110.5 million and an accumulated deficit of $521.1 million.
Previous wording
In January 2023, we entered into a Revenue Interest Financing Agreement with HealthCare Royalty Partners IV, L.P. (“HCR”), as amended (the “RIFA”), pursuant to which HCR has agreed to pay us an aggregate investment amount of up to $100.0 million (the “Investment Amount”). $32.5 million of the Investment Amount was funded on January 27, 2023, $22.2 million of which was used to satisfy in full and retire our previously outstanding debt with Silicon Valley Bank, with the excess proceeds funded to the Company. An additional $10.0 million of the Investment Amount was funded on July 27, 2023 (the “Second Tranche Amount”), which was used to fund payment of the $10.0 million upfront license fee due under the Pharmosa License Agreement. On January 5, 2024 an additional $25.0 million of the Investment Amount was funded. See Note 12 to the condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for information regarding repayment.
Current wording
In January 2023, we entered into a Revenue Interest Financing Agreement with HealthCare Royalty Partners IV, L.P. (“HCR”), as amended (the “RIFA”), pursuant to which HCR has agreed to pay us an aggregate investment amount of up to $100.0 million (the “Investment Amount”). $32.5 million of the Investment Amount was funded on January 27, 2023, $22.2 million of which was used to satisfy in full and retire our previously outstanding debt with Silicon Valley Bank, with the excess proceeds funded to the Company. An additional $10.0 million of the Investment Amount was funded on July 27, 2023 (the “Second Tranche Amount”), which was used to fund payment of the $10.0 million upfront license fee due under the Pharmosa License Agreement. On January 5, 2024, an additional $25.0 million of the Investment Amount was funded. On September 12, 2024, an additional $32.5 million of the Investment Amount was funded. See Note 12 to the condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for information regarding repayment.
Previous wording
Prior to the potential FDA approval of YUTREPIA and until such time as we can generate significant revenues from its sale, if ever, we anticipate we will incur net losses and negative cash flows. We plan to focus in the near-term on preparations for the potential commercial launch of YUTREPIA, continuing promotion of Treprostinil Injection, investing in research and development efforts for our YUTREPIA and L606 programs, and expanding our corporate infrastructure. We may not be able to complete the development and initiate commercialization of these programs if, among other things, our clinical trials are not successful or if the FDA does not approve our product candidates when we expect, or at all.
Current wording
Prior to the potential FDA approval of YUTREPIA and until such time as we can generate significant revenues from its sale, if ever, we anticipate we will incur net losses and negative cash flows. We plan to focus in the near-term on preparations for the potential commercial launch of YUTREPIA, continuing promotion of Treprostinil Injection, investing in research and development efforts for our YUTREPIA and L606 programs, and expanding our corporate infrastructure. We may not be able to complete the development and initiate commercialization of these programs if,
Previous wording
Our primary uses of capital are, and we expect will continue to be, compensation and related personnel expenses, clinical costs, manufacturing process development costs, external research and development services, laboratory and related supplies, regulatory expenses, legal costs, administrative and overhead costs and repayments under the RIFA. We also expect to incur significant commercialization expenses related to product manufacturing, sales, marketing and distribution as we prepare to potentially receive regulatory approval for YUTREPIA. Our future funding requirements will be heavily determined by the timing of the potential commercialization of YUTREPIA, the indications, if any, for which YUTREPIA is approved and the resources needed to support the development of our product candidates. Based on our current plans, we expect that we will require additional capital. See Note 1 to the condensed consolidated financial statements appearing elsewhere in this Quarterly Report on Form 10-Q for information regarding our ability to continue as a going concern.
Current wording
Our primary uses of capital are, and we expect will continue to be, compensation and related personnel expenses, clinical costs, manufacturing process development costs, external research and development services, laboratory and related supplies, regulatory expenses, legal costs, administrative and overhead costs and repayments under the RIFA. We also expect to incur significant commercialization expenses related to product manufacturing, sales, marketing and distribution as we prepare to potentially receive regulatory approval for YUTREPIA.
Previous wording
We may raise additional capital through licensing activities, other business arrangements or the sale of equity or convertible debt securities. In such an event, the ownership of our existing shareholders will be diluted, and the terms of
Current wording
We may raise additional capital through licensing activities, other business arrangements or the sale of equity or convertible debt securities. In such an event, the ownership of our existing shareholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights associated with holdings of our common stock.
Previous wording
Net cash used in operating activities increased $33.5 million to $47.5 million for the six months ended June 30, 2024 compared to $14.0 million for the six months ended June 30, 2023. The increase was primarily due to $27.8 million higher net loss adjusted for non-cash items and unfavorable working capital changes of $5.7 million.
Current wording
Net cash used in operating activities increased $47.0 million to $72.6 million for the nine months ended September 30, 2024 compared to $25.6 million for the nine months ended September 30, 2023. The increase was primarily due to $38.7 million higher net loss adjusted for non-cash items and unfavorable working capital changes of $8.3 million.
Previous wording
Net cash used in investing activities was $1.9 million for the six months ended June 30, 2024 compared to $0.6 million for the six months ended June 30, 2023. During both the six months ended June 30,2024 and 2023, net cash used in investing activities related to property, plant and equipment purchases.
Current wording
Net cash used in investing activities was $3.7 million for the nine months ended September 30, 2024 compared to $11.1 million for the nine months ended September 30, 2023. During the nine months ended September 30, 2024, net cash used in investing activities related to property, plant and equipment purchases. During the nine months ended September 30, 2023, we made a $10.0 million upfront license fee payment to Pharmosa for the exclusive license in North America to develop and commercialize L606 and paid $1.1 million for property, plant and equipment purchases.
Previous wording
Net cash provided by financing activities was $98.9 million during the six months ended June 30, 2024, compared to $9.5 million during the six months ended June 30, 2023. During the six months ended June 30, 2024, we received $74.9 million net proceeds from the 2024 Private Placement, $25.0 million net proceeds from the RIFA, and $0.5 million from the issuance of common stock under stock incentive plans. These inflows were offset by $1.7 million in payments under the RIFA. During the six months ended June 30, 2023, we received $31.8 million net proceeds from the RIFA of which $22.2 million was used to repay our indebtedness to Silicon Valley Bank.
Current wording
Net cash provided by financing activities was $197.0 million during the nine months ended September 30, 2024, compared to $19.6 million during the nine months ended September 30, 2023. During the nine months ended September 30, 2024, we received $138.9 million net proceeds from the sale of common stock primarily relating to the 2024 Offering and 2024 Private Placement, $57.5 million net proceeds from the RIFA, and $2.9 million from the issuance of common stock under stock incentive plans. These inflows were offset by $2.7 million in payments under the RIFA. During the nine months ended September 30, 2023, we received $41.7 million net proceeds from the RIFA of which $22.2 million was used to repay our indebtedness to Silicon Valley Bank.
Previous wording
In December 2022, we entered into a Device Development and Supply Agreement (the “Pump Development Agreement”) with Mainbridge Health Partners, LLC (“Mainbridge”) and Sandoz Inc. (“Sandoz”). The Pump Development Agreement provides for the cooperation between us, Sandoz and Mainbridge to develop a new pump that is suitable for the subcutaneous administration of Treprostinil Injection. Mainbridge will perform all development, validation and testing activities required for the pump and related consumables in anticipation of submitting a 510(k) clearance application for the pump to the FDA in 2025. In connection with the Pump Development Agreement, we and Sandoz have agreed to pay Mainbridge certain future contingent milestone payments in accordance with the terms and conditions set forth therein.
Current wording
is suitable for the subcutaneous administration of Treprostinil Injection. Mainbridge will perform all development, validation and testing activities required for the pump and related consumables in anticipation of submitting a 510(k) clearance application for the pump to the FDA. In connection with the Pump Development Agreement, we and Sandoz have agreed to pay Mainbridge certain future contingent milestone payments in accordance with the terms and conditions set forth therein.
Previous wording
As of June 30, 2024, we have non-cancelable commitments for product supply and manufacturing costs of approximately $3.5 million.
Current wording
As of September 30, 2024, we have non-cancelable commitments for product supply and manufacturing costs of approximately $14.7 million.
Previous wording
We have operating lease obligations including rental amounts due on leases of certain laboratory, manufacturing and office space and equipment under the terms of non-cancelable operating leases. These leases expire at various times through October 2026. Minimum operating lease payments are $0.6 million in the remaining six months of 2024, $1.4 million in 2025, and $1.2 million in 2026.
Current wording
We have operating lease obligations including rental amounts due on leases of certain laboratory, manufacturing and office space and equipment under the terms of non-cancelable operating leases. These leases expire at various times through October 2026. Minimum operating lease payments are $0.3 million in the remaining three months of 2024, $1.4 million in 2025, and $1.2 million in 2026.
Previous wording
We base our expenses related to CROs and CMOs on our estimates of the services received and efforts expended pursuant to quotations and contracts with such vendors that conduct research and development and manufacturing activities on our behalf. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows. There may be instances in which payments made to our vendors will exceed the level of services provided and result in a prepayment of the applicable research and development or manufacturing expense. In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from our estimate, we adjust the accrual or prepaid expense accordingly. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and could result in us reporting amounts that are
Current wording
We base our expenses related to CROs and CMOs on our estimates of the services received and efforts expended pursuant to quotations and contracts with such vendors that conduct research and development and manufacturing activities on our behalf. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows. There may be instances in which payments made to our vendors will exceed the level of services provided and result in a prepayment of the applicable research and development or manufacturing expense. In accruing service fees, we estimate the time period over which services will be performed and the level of effort to be expended in each period. If the actual timing of the performance of services or the level of effort varies from our estimate, we adjust the accrual or prepaid expense accordingly. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed relative to the actual status and timing of services performed may vary and could result in us reporting amounts that are too high or too low in any particular period. There have been no material changes in estimates for the periods presented within this Quarterly Report on Form 10-Q.
Previous wording
We capitalize prelaunch inventory prior to receiving regulatory approval if regulatory approval and subsequent commercialization of a product is probable and we also expect future economic benefit from the sales of the product to be realized. Prior to this conclusion, we expense prelaunch inventory as research and development expense in the period incurred. For prelaunch inventory that is capitalized, we consider a number of specific facts and circumstances, including the product’s historical shelf life, the product's current status in the development and regulatory approval process, results from related clinical trials, results from meetings with relevant regulatory agencies prior to the filing of regulatory applications, potential obstacles to the approval process, viability of commercialization and market trends. In late 2023, based on our assessment of the legal and regulatory process related to YUTREPIA, we concluded that we met the criteria to capitalize expenditures for prelaunch inventory. We capitalized $7.2 million of prelaunch inventory as of June 30, 2024 and none as of December 31, 2023. We do not have an allowance for inventory obsolescence as of June 30, 2024. If either regulatory approval or market acceptance post-approval of YUTREPIA do not occur at all or on a timely basis prior to the inventory shelf-life expiration, we may be required to write-off some or all prelaunch inventory, which could affect our financial condition and financial results.
Current wording
We capitalize prelaunch inventory prior to receiving regulatory approval if regulatory approval and subsequent commercialization of a product is probable and we also expect future economic benefit from the sales of the product to be realized. Prior to this conclusion, we expense prelaunch inventory as research and development expense in the period incurred. For prelaunch inventory that is capitalized, we consider a number of specific facts and circumstances, including the product’s historical shelf life, the product's current status in the development and regulatory approval process, results from related clinical trials, results from meetings with relevant regulatory agencies prior to the filing of regulatory applications, potential obstacles to the approval process, viability of commercialization and market trends. In late 2023, based on our assessment of the legal and regulatory process related to YUTREPIA, we concluded that we met the criteria to capitalize expenditures for prelaunch inventory. We capitalized $7.4 million of prelaunch inventory as of September 30, 2024 and none as of December 31, 2023. We do not have an allowance for inventory obsolescence as of September 30, 2024. If either regulatory approval or market acceptance post-approval of YUTREPIA do not occur at all or on a timely basis prior to the inventory shelf-life expiration, we may be required to write-off some or all prelaunch inventory, which could affect our financial condition and financial results.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
administration of Treprostinil Injection. Revenue will continue to be impacted or at risk until new components or alternative pumps are available.
Current report — wording carried from elsewhere
among other things, our clinical trials are not successful or if the FDA does not approve our product candidates when we expect, or at all.
Current report — wording carried from elsewhere
Our future funding requirements will be heavily determined by the timing of the potential commercialization of YUTREPIA, the indications, if any, for which YUTREPIA is approved and the resources needed to support the development of our product candidates. Based on our current plans, we expect that we will require additional capital.
Current report — wording carried from elsewhere
In December 2022, we entered into a Device Development and Supply Agreement (the “Pump Development Agreement”) with Mainbridge Health Partners, LLC (“Mainbridge”) and Sandoz Inc. (“Sandoz”). The Pump Development Agreement provides for the cooperation between us, Sandoz and Mainbridge to develop a new pump that
Rearranged previous paragraphs (5)
Previous report — wording carried elsewhere
operate through our wholly owned operating subsidiaries, Liquidia Technologies, Inc. (“Liquidia Technologies”) and Liquidia PAH, LLC (“Liquidia PAH”), formerly known as RareGen, LLC (“RareGen”).
Previous report — wording carried elsewhere
financing payable, finance leases and long-term debt. These charges include monthly recurring interest on such obligations in addition to interest accretion and amortization of debt discounts and issuance costs to interest expense.
Previous report — wording carried elsewhere
respectively. As of June 30, 2024, we had stockholders’ equity of $62.7 million and an accumulated deficit of $498.0 million.
Previous report — wording carried elsewhere
these securities may include liquidation or other preferences that adversely affect the rights associated with holdings of our common stock.
Previous report — wording carried elsewhere
too high or too low in any particular period. There have been no material changes in estimates for the periods presented within this Quarterly Report on Form 10-Q.