Gossamer Bio Inc

Previous wording

We were incorporated in October 2015 and commenced operations in 2017. To date, we have focused primarily on organizing and staffing our company, business planning, raising capital, identifying, acquiring and in-licensing our product candidates and conducting preclinical studies and clinical trials. We have funded our operations primarily through equity and debt financings and the collaboration agreement. We raised $1,393.2 million from October 2017 through June 30, 2024 through the sale of Series A and Series B convertible preferred stock, issuance of convertible notes, proceeds from our IPO, completed in February 2019, proceeds from our 2027 Notes (as defined below), issuance of common stock in May 2020 and July 2022, issuance of common stock and accompanying warrants in July 2023 and entry into the collaboration agreement in May 2024. As of June 30, 2024, we had $354.5 million in cash, cash equivalents and marketable securities.

Current wording

We were incorporated in October 2015 and commenced operations in 2017. To date, we have focused primarily on organizing and staffing our company, business planning, raising capital, identifying, acquiring and in-licensing our product candidates and conducting preclinical studies and clinical trials. We have funded our operations primarily through equity and debt financings and the collaboration agreement. We raised $1,394.4 million from October 2017 through September 30, 2024 through the sale of Series A and Series B convertible preferred stock, issuance of convertible notes, proceeds from our

Previous wording

We have incurred significant operating losses since our inception and expect to continue to incur significant operating losses for the foreseeable future. For the three months ended June 30, 2024 and 2023, our net income was $49.2 million and net loss was $42.5 million, respectively. For the six months ended June 30, 2024 and 2023, our net income was $7.3 million and net loss was $91.7 million, respectively. As of June 30, 2024, we had an accumulated deficit of $1,204.7 million. We expect to incur expenses and operating losses for the foreseeable future as we continue our development of and seek regulatory approvals for seralutinib, including the conduct of ongoing and planned clinical trials and other research and development activities; and as we hire additional personnel, protect our intellectual property and incur additional costs associated with being a public company. In addition, as seralutinib progresses through development and toward commercialization, we will need to make milestone payments to Pulmokine from whom we have in-licensed seralutinib. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending in particular on the timing of our clinical trials and preclinical studies and our expenditures on other research and development activities.

Current wording

We have incurred significant operating losses since our inception and expect to continue to incur significant operating losses for the foreseeable future. For the three months ended September 30, 2024 and 2023, our net loss was $30.8 million and $40.0 million, respectively. For the nine months ended September 30, 2024 and 2023, our net loss was $23.5 million and $131.7 million, respectively. As of September 30, 2024, we had an accumulated deficit of $1,235.5 million. We expect to incur expenses and operating losses for the foreseeable future as we continue our development of and seek regulatory approvals for seralutinib, including the conduct of ongoing and planned clinical trials and other research and development activities; and as we hire additional personnel, protect our intellectual property and incur additional costs associated with being a public company. In addition, as seralutinib progresses through development and toward commercialization, we will need to make milestone payments to Pulmokine from whom we have in-licensed seralutinib. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending in particular on the timing of our clinical trials and preclinical studies and our expenditures on other research and development activities.

Previous wording

In the future, we may generate revenue from a combination of license fees and other upfront payments, other funded research and development agreements, milestone payments, product sales, other third-party funding, US profit/loss share and royalties in connection with strategic alliances. We expect that any revenue we generate will fluctuate from quarter-to-quarter as a result of the timing of our achievement of regulatory and commercialization milestones, the timing and amount of payments relating to such milestones and the extent to which any of our products are approved and successfully commercialized. If we are unable to fund our development costs or we are unable to develop product candidates in a timely manner or obtain regulatory approval for them, our ability to generate future revenues and our results of operations and financial position would be adversely affected.

Current wording

In the future, we may generate revenue from a combination of license fees and other upfront payments, other funded research and development agreements, milestone payments, product sales, other third-party funding, US profit/loss share and royalties in connection with strategic alliances. We expect that any revenue we generate will fluctuate from quarter-to-quarter as a result of the timing of performance of research and development services, the timing of our achievement of regulatory and commercialization milestones, the timing and amount of payments relating to such milestones and the extent to which any of our products are approved and successfully commercialized. If we are unable to fund our development costs or we are unable to develop product candidates in a timely manner or obtain regulatory approval for them, our ability to generate future revenues and our results of operations and financial position would be adversely affected.

Previous wording

Other income (expense), net consists of (1) interest income on our cash, cash equivalents and marketable securities, (2) investment accretion, (3) interest expense related to our Credit Facility and our 2027 Notes, (4) research and development tax credit and (5) other miscellaneous income.

Current wording

Other income, net consists of (1) interest income on our cash, cash equivalents and marketable securities, (2) investment accretion, (3) interest expense related to our Credit Facility and our 2027 Notes, (4) research and development tax credit and (5) other miscellaneous income.

Previous wording

Our management’s discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. The preparation of these financial statements requires us to make judgments and estimates that affect the reported amounts of assets, liabilities, revenue, expenses and the disclosure of contingent assets and liabilities in our condensed consolidated financial statements. We base our estimates on historical experience, known trends and events, and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. On an ongoing basis, we evaluate our judgments and estimates in light of changes in circumstances, facts and experience. Other than our accounting for the collaborative arrangements and revenue recognition discussed below, during the six months ended June 30, 2024, there have been no significant changes in our critical accounting policies and estimates as discussed in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K filed with the SEC on March 5, 2024.

Current wording

Our management’s discussion and analysis of our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. The preparation of these financial statements requires us to make judgments and estimates that affect the reported amounts of assets, liabilities, revenue, expenses and the disclosure of contingent assets and liabilities in our condensed consolidated financial statements. We base our estimates on historical experience, known trends and events, and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. On an ongoing basis, we evaluate our judgments and estimates in light of changes in circumstances, facts and experience. Other than our accounting for the collaborative arrangements and revenue recognition discussed below, during the nine months ended September 30, 2024, there have been no significant changes in our critical accounting policies and estimates as discussed in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K filed with the SEC on March 5, 2024.

Previous wording

Results of Operations – Comparison of the Three and Six Months Ended June 30, 2024 and 2023

Current wording

Results of Operations – Comparison of the Three and Nine Months Ended September 30, 2024 and 2023

Previous wording

The following table sets forth our selected statements of operations data for the six months ended June 30, 2024 and 2023:

Current wording

The following table sets forth our selected statements of operations data for the nine months ended September 30, 2024 and 2023:

Previous wording

Revenue was $95.8 million for the three and six months ended June 30, 2024. Our revenue is generated from our ongoing collaboration with Chiesi and consists of a one-time development cost reimbursement payment for the licenses and ongoing cost-sharing payments for performance of research and development services during three months ended June 30, 2024.

Current wording

For the three and nine months ended September 30, 2024, our revenue was $9.5 million and $105.3 million, respectively. Our revenue is generated from our ongoing collaboration with Chiesi and consists of a one-time development cost reimbursement payment for the licenses and ongoing cost-sharing payments for performance of research and development services.

Previous wording

Research and development expenses were $35.1 million for the three months ended June 30, 2024, compared to $36.3 million for the three months ended June 30, 2023, for a decrease of $1.2 million, which was primarily attributable to a decrease of $11.6 million of costs associated with preclinical studies and clinical trials for the terminated programs, offset by an increase of $10.4 million of costs associated with preclinical studies and clinical trials for seralutinib.

Current wording

Research and development expenses were $34.9 million for the three months ended September 30, 2024, compared to $31.2 million for the three months ended September 30, 2023, for an increase of $3.7 million, which was primarily attributable to an increase of $5.7 million of costs associated with preclinical studies and clinical trials for seralutinib, offset by a decrease of $2.0 million of costs associated with preclinical studies and clinical trials for terminated programs.

Previous wording

Research and development expenses were $67.5 million for the six months ended June 30, 2024, compared to $74.1 million for the six months ended June 30, 2023, for a decrease of $6.6 million, which was primarily attributable to a decrease of $28.8 million of costs associated with preclinical studies and clinical trials for the terminated programs, offset by an increase of $22.2 million of costs associated with preclinical studies and clinical trials for seralutinib.

Current wording

Research and development expenses were $102.4 million for the nine months ended September 30, 2024, compared to $105.3 million for the nine months ended September 30, 2023, for a decrease of $3.0 million, which was primarily attributable to a decrease of $30.9 million of costs associated with preclinical studies and clinical trials for terminated programs, offset by an increase of $27.9 million of costs associated with preclinical studies and clinical trials for seralutinib.

Previous wording

The following table shows our research and development expenses by program for the three and six months ended June 30, 2024 and 2023:

Current wording

The following table shows our research and development expenses by program for the three and nine months ended September 30, 2024 and 2023:

Previous wording

General and administrative expenses were $18.2 million for the six months ended June 30, 2024, compared to $20.1 million for the six months ended June 30, 2023, for a decrease of $1.9 million, which was primarily attributable to a $1.5 million decrease in stock-based compensation expense and a decrease of $0.3 million in insurance expense.

Current wording

General and administrative expenses were $8.5 million for the three months ended September 30, 2024, compared to $9.3 million for the three months ended September 30, 2023, for a decrease of $0.8 million, which was primarily attributable to a $0.4 million decrease in stock-based compensation expense and a decrease of $0.4 million in legal expense.

Previous wording

General and administrative expenses were $8.7 million for the three months ended June 30, 2024, compared to $10.0 million for the three months ended June 30, 2023, for a decrease of $1.3 million, which was primarily attributable to a $1.0 million decrease in stock-based compensation expense, a decrease of $0.2 million in insurance expense and a decrease of $0.2 million in professional services.

Current wording

General and administrative expenses were $26.7 million for the nine months ended September 30, 2024, compared to $29.4 million for the nine months ended September 30, 2023, for a decrease of $2.7 million, which was primarily attributable to a $1.9 million decrease in stock-based compensation expense, a decrease of $0.5 million in insurance expense and a decrease of $0.3 million in legal expense.

Previous wording

Other expense, net was $1.6 million for the six months ended June 30, 2024, compared to other income, net of $2.6 million for the six months ended June 30, 2023, for a decrease of $1.0 million, which was primarily attributable to a $4.9 million decrease in other income related to $2.8 million of employee retention credit under the CARES Act and $2.1 million of Ireland Corporate R&D tax credit, offset by a $0.9 million decrease in interest expense and $2.9 million increase in investment accretion.

Current wording

Other income, net was $2.0 million for the three months ended September 30, 2024, compared to other income, net of $0.5 million for the three months ended September 30, 2023, for an increase of $1.5 million, which was primarily attributable to a $0.9 million increase in investment accretion and $0.6 million decrease in interest expense.

Previous wording

Other expense, net was $1.6 million for the three months ended June 30, 2024, compared to other income, net of $3.8 million for the three months ended June 30, 2023, for a decrease of $2.2 million, which was primarily attributable to a $4.9 million decrease in other income related to $2.8 million of employee retention credit under the Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, and $2.1 million of Ireland Corporate R&D tax credit, offset by a $1.1 million increase in interest income and $1.5 million increase in investment accretion.

Current wording

Other income, net was $3.6 million for the nine months ended September 30, 2024, compared to other income, net of $3.1 million for the nine months ended September 30, 2023, for an increase of $0.5 million, which was primarily attributable to a $3.8 million increase in investment accretion, a $1.6 million decrease in interest expense, offset by a $4.9 million decrease in other income related to $2.8 million of employee retention credit under the Coronavirus Aid, Relief, and Economic Security (CARES) Act and $2.1 million of Ireland Corporate R&D tax credit.

Previous wording

We have incurred substantial operating losses since our inception and expect to continue to incur significant operating losses for the foreseeable future and may never become profitable. As of June 30, 2024, we had an accumulated deficit of $1,204.7 million.

Current wording

We have incurred substantial operating losses since our inception and expect to continue to incur significant operating losses for the foreseeable future and may never become profitable. As of September 30, 2024, we had an accumulated deficit of $1,235.5 million.

Previous wording

From our inception through June 30, 2024, our operations have been financed primarily by proceeds of $1,393.2 million from the sale of Series A and Series B convertible preferred stock, proceeds from our IPO, proceeds from our 2027 Notes, proceeds from issuance of common stock in May 2020 and July 2022, proceeds from issuance of common stock and accompanying warrants in July 2023 and the collaboration agreement with Chiesi. As of June 30, 2024 we had cash, cash equivalents and marketable securities of $354.5 million. Cash in excess of immediate requirements is invested in accordance with our investment policy, primarily with a view to capital preservation and liquidity.

Current wording

From our inception through September 30, 2024, our operations have been financed primarily by proceeds of $1,394.4 million from the sale of Series A and Series B convertible preferred stock, proceeds from our IPO, proceeds from our 2027 Notes, proceeds from issuance of common stock in May 2020 and July 2022, proceeds from issuance of common stock and accompanying warrants in July 2023 and the collaboration agreement with Chiesi. As of September 30, 2024 we had cash, cash equivalents and marketable securities of $327.0 million. Cash in excess of immediate requirements is invested in accordance with our investment policy, primarily with a view to capital preservation and liquidity.

Previous wording

The following table shows a summary of our cash flows for each of the six months ended June 30, 2024 and 2023, respectively:

Current wording

The following table shows a summary of our cash flows for each of the nine months ended September 30, 2024 and 2023, respectively:

Previous wording

During the six months ended June 30, 2024, operating activities provided approximately $64.0 million of cash, primarily resulting from net income of $7.3 million and changes in contract liabilities of $66.7 million, reduced by changes in accrued expenses of $5.8 million and changes in amortization of premium on marketable securities, net of accretion of $6.0 million.

Current wording

During the nine months ended September 30, 2024, operating activities provided approximately $32.0 million of cash, primarily resulting from changes in contract liabilities of $64.1 million and changes in stock-based compensation expense of $15.7 million, reduced by the net loss of $23.5 million, changes in amortization of premium on investments, net of accretion of discount, of $9.7 million, changes in accrued expenses of $9.8 million and changes in accounts payable of $4.7 million.

Previous wording

During the six months ended June 30, 2023, operating activities used approximately $91.2 million of cash, primarily resulting from a net loss of $91.7 million and changes in prepaid expenses and other current liabilities of $5.0 million, changes in accrued research and development expenses of $3.6 million and changes in accrued compensation and benefits of $5.3 million, reduced by stock-based compensation expense of $16.3 million.

Current wording

During the nine months ended September 30, 2023, operating activities used approximately $125.7 million of cash, primarily resulting from a net loss of $131.7 million and changes in prepaid expenses and other current liabilities of $6.4 million, changes in amortization of premium on investments of $5.9 million and changes in accrued compensation and benefits of $4.5 million, reduced by stock-based compensation expense of $22.5 million.

Previous wording

During the six months ended June 30, 2024, investing activities provided approximately $2.6 million of cash, primarily resulting from the maturities of marketable securities of $282.3 million, offset by the purchases of marketable securities of $279.7 million.

Current wording

During the nine months ended September 30, 2024, investing activities used approximately $24.2 million of cash, primarily resulting from the purchases of marketable securities of $411.1 million, offset by the maturities of marketable securities of $386.9 million.

Previous wording

During the six months ended June 30, 2023, investing activities provided approximately $21.7 million of cash, primarily resulting from the maturities of marketable securities of $155.0 million, offset by the purchases of marketable securities of $133.3 million.

Current wording

During the nine months ended September 30, 2023, investing activities used approximately $96.6 million of cash, primarily resulting from the purchases of marketable securities of $321.4 million, offset by the maturities of marketable securities of $224.8 million.

Previous wording

During the six months ended June 30, 2024, financing activities used $11.8 million of cash, primarily resulting from the principal repayments of long-term debt of $12.6 million, reduced by the proceeds from the grant of an equity option pursuant to the Chiesi Collaboration Agreement of $0.5 million and the proceeds from issuance of common stock pursuant to the ESPP of $0.3 million.

Current wording

During the nine months ended September 30, 2024, financing activities used $11.5 million of cash, primarily resulting from the principal repayments of long-term debt of $12.6 million, reduced by the proceeds from the grant of an equity option pursuant to the Chiesi Collaboration Agreement of $0.5 million and the proceeds from issuance of common stock pursuant to the ESPP of $0.6 million.

Previous wording

During the six months ended June 30, 2023, financing activities used $5.4 million of cash, primarily resulting from the principal repayments of long-term debt of $5.8 million, offset by proceeds from the purchase of shares pursuant to the ESPP of $0.4 million.

Current wording

During the nine months ended September 30, 2023, financing activities provided $193.1 million of cash, primarily resulting from proceeds from the issuance of common stock and warrants in a private offering of $201.3 million and the proceeds from issuance of common stock pursuant to the ESPP of $0.4 million, reduced by the principal repayments of long-term debt of $8.7 million.