cccc-10q_20210630.htm
false Q2 0001662579 --12-31 0.118574732 0.118574732 0.118574732 P5Y P5Y 0001662579 2021-01-01 2021-06-30 xbrli:shares 0001662579 2021-08-02 iso4217:USD 0001662579 2021-06-30 0001662579 2020-12-31 iso4217:USD xbrli:shares 0001662579 2021-04-01 2021-06-30 0001662579 2020-04-01 2020-06-30 0001662579 2020-01-01 2020-06-30 0001662579 us-gaap:CommonStockMember 2020-12-31 0001662579 us-gaap:AdditionalPaidInCapitalMember 2020-12-31 0001662579 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-12-31 0001662579 us-gaap:RetainedEarningsMember 2020-12-31 0001662579 us-gaap:CommonStockMember 2021-01-01 2021-03-31 0001662579 us-gaap:AdditionalPaidInCapitalMember 2021-01-01 2021-03-31 0001662579 2021-01-01 2021-03-31 0001662579 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-01-01 2021-03-31 0001662579 us-gaap:RetainedEarningsMember 2021-01-01 2021-03-31 0001662579 us-gaap:CommonStockMember 2021-03-31 0001662579 us-gaap:AdditionalPaidInCapitalMember 2021-03-31 0001662579 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-03-31 0001662579 us-gaap:RetainedEarningsMember 2021-03-31 0001662579 2021-03-31 0001662579 us-gaap:CommonStockMember 2021-04-01 2021-06-30 0001662579 us-gaap:AdditionalPaidInCapitalMember 2021-04-01 2021-06-30 0001662579 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-04-01 2021-06-30 0001662579 us-gaap:RetainedEarningsMember 2021-04-01 2021-06-30 0001662579 us-gaap:CommonStockMember 2021-06-30 0001662579 us-gaap:AdditionalPaidInCapitalMember 2021-06-30 0001662579 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2021-06-30 0001662579 us-gaap:RetainedEarningsMember 2021-06-30 0001662579 us-gaap:RedeemableConvertiblePreferredStockMember 2020-04-01 2020-06-30 0001662579 us-gaap:RedeemableConvertiblePreferredStockMember 2019-12-31 0001662579 us-gaap:CommonStockMember 2019-12-31 0001662579 us-gaap:AdditionalPaidInCapitalMember 2019-12-31 0001662579 us-gaap:RetainedEarningsMember 2019-12-31 0001662579 2019-12-31 0001662579 us-gaap:CommonStockMember 2020-01-01 2020-03-31 0001662579 us-gaap:AdditionalPaidInCapitalMember 2020-01-01 2020-03-31 0001662579 2020-01-01 2020-03-31 0001662579 us-gaap:RetainedEarningsMember 2020-01-01 2020-03-31 0001662579 us-gaap:RedeemableConvertiblePreferredStockMember 2020-03-31 0001662579 us-gaap:CommonStockMember 2020-03-31 0001662579 us-gaap:AdditionalPaidInCapitalMember 2020-03-31 0001662579 us-gaap:RetainedEarningsMember 2020-03-31 0001662579 2020-03-31 0001662579 us-gaap:CommonStockMember 2020-04-01 2020-06-30 0001662579 us-gaap:AdditionalPaidInCapitalMember 2020-04-01 2020-06-30 0001662579 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-04-01 2020-06-30 0001662579 us-gaap:RetainedEarningsMember 2020-04-01 2020-06-30 0001662579 us-gaap:RedeemableConvertiblePreferredStockMember 2020-06-30 0001662579 us-gaap:CommonStockMember 2020-06-30 0001662579 us-gaap:AdditionalPaidInCapitalMember 2020-06-30 0001662579 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-06-30 0001662579 us-gaap:RetainedEarningsMember 2020-06-30 0001662579 2020-06-30 0001662579 cccc:WatertownLeaseMember 2021-01-01 2021-06-30 0001662579 us-gaap:CommonStockMember us-gaap:IPOMember 2020-10-06 2020-10-06 0001662579 us-gaap:CommonStockMember us-gaap:IPOMember 2020-10-06 0001662579 2020-09-25 2020-09-25 xbrli:pure 0001662579 us-gaap:MoneyMarketFundsMember 2021-06-30 0001662579 us-gaap:MoneyMarketFundsMember us-gaap:FairValueInputsLevel1Member 2021-06-30 0001662579 us-gaap:CorporateDebtSecuritiesMember 2021-06-30 0001662579 us-gaap:CorporateDebtSecuritiesMember us-gaap:FairValueInputsLevel2Member 2021-06-30 0001662579 us-gaap:USStatesAndPoliticalSubdivisionsMember 2021-06-30 0001662579 us-gaap:USStatesAndPoliticalSubdivisionsMember us-gaap:FairValueInputsLevel2Member 2021-06-30 0001662579 us-gaap:USTreasurySecuritiesMember 2021-06-30 0001662579 us-gaap:USTreasurySecuritiesMember us-gaap:FairValueInputsLevel2Member 2021-06-30 0001662579 us-gaap:FairValueInputsLevel1Member 2021-06-30 0001662579 us-gaap:FairValueInputsLevel2Member 2021-06-30 0001662579 us-gaap:CorporateDebtSecuritiesMember 2021-06-30 0001662579 us-gaap:USGovernmentDebtSecuritiesMember 2021-06-30 0001662579 us-gaap:USTreasurySecuritiesMember 2021-06-30 0001662579 us-gaap:USTreasurySecuritiesMember 2020-12-31 cccc:MarketableSecurity 0001662579 cccc:LaboratoryEquipmentMember 2021-06-30 0001662579 cccc:LaboratoryEquipmentMember 2020-12-31 0001662579 us-gaap:FurnitureAndFixturesMember 2021-06-30 0001662579 us-gaap:FurnitureAndFixturesMember 2020-12-31 0001662579 us-gaap:LeaseholdsAndLeaseholdImprovementsMember 2021-06-30 0001662579 us-gaap:LeaseholdsAndLeaseholdImprovementsMember 2020-12-31 0001662579 us-gaap:ComputerEquipmentMember 2021-06-30 0001662579 us-gaap:ComputerEquipmentMember 2020-12-31 0001662579 us-gaap:OfficeEquipmentMember 2021-06-30 0001662579 us-gaap:OfficeEquipmentMember 2020-12-31 0001662579 cccc:WatertownLeaseMember cccc:RestrictedCashMember 2021-06-30 0001662579 cccc:WatertownLeaseMember 2021-04-01 2021-06-30 0001662579 cccc:WatertownLeaseMember 2020-04-01 2020-06-30 0001662579 cccc:WatertownLeaseMember 2020-01-01 2020-06-30 cccc:Target 0001662579 cccc:RestatedRocheAgreementMember 2018-12-22 0001662579 cccc:RestatedRocheAgreementMember 2018-12-22 2018-12-22 0001662579 cccc:RestatedRocheAgreementMember cccc:LeadSeriesIdentificationAchievementMember 2018-12-22 2018-12-22 0001662579 cccc:RestatedRocheAgreementMember cccc:GoodLaboratoryPracticeGlpToxicologyToxStudyPhaseMember 2018-12-22 2018-12-22 0001662579 cccc:RestatedRocheAgreementMember srt:MinimumMember 2018-12-22 2018-12-22 0001662579 cccc:RestatedRocheAgreementMember srt:MaximumMember 2018-12-22 2018-12-22 0001662579 cccc:RestatedRocheAgreementMember srt:MaximumMember cccc:ResearchDevelopmentAndCommercialMilestonePaymentsMember 2018-12-22 0001662579 cccc:RestatedRocheAgreementMember srt:MaximumMember cccc:OneTimeSalesBasedPaymentsMember 2018-12-22 0001662579 cccc:RestatedRocheAgreementMember 2021-01-01 2021-06-30 0001662579 cccc:BiogenLicenseAgreementMember 2018-12-01 2018-12-31 cccc:Protein 0001662579 cccc:BiogenLicenseAgreementMember srt:MaximumMember 2018-12-01 2018-12-31 0001662579 cccc:BiogenLicenseAgreementMember 2021-01-01 2021-06-30 0001662579 cccc:BiogenLicenseAgreementMember srt:MaximumMember cccc:ResearchAndDevelopmentMilestonesMember 2021-01-01 2021-06-30 0001662579 cccc:BiogenLicenseAgreementMember srt:MaximumMember cccc:OneTimeSalesBasedPaymentsMember 2021-01-01 2021-06-30 0001662579 cccc:BiogenLicenseAgreementMember srt:MinimumMember 2021-01-01 2021-06-30 cccc:Performanceobligation 0001662579 cccc:BiogenLicenseAgreementMember 2021-06-30 0001662579 cccc:BiogenLicenseAgreementMember 2021-05-01 2021-05-31 0001662579 cccc:CalicoLicenseAgreementMember 2021-01-01 2021-03-31 cccc:TargetProtein 0001662579 cccc:CalicoLicenseAgreementMember srt:MaximumMember 2021-06-30 0001662579 cccc:CalicoLicenseAgreementMember 2021-01-01 2021-06-30 0001662579 cccc:CalicoLicenseAgreementMember srt:MaximumMember cccc:PotentialResearchDevelopmentAndCommercialMilestonePaymentsMember 2021-01-01 2021-06-30 0001662579 cccc:CalicoLicenseAgreementMember srt:MaximumMember cccc:OneTimeSalesBasedPaymentsMember 2021-01-01 2021-06-30 0001662579 cccc:CalicoLicenseAgreementMember srt:ScenarioForecastMember 2021-08-01 2021-08-31 0001662579 cccc:CalicoLicenseAgreementMember 2021-06-30 0001662579 cccc:CalicoLicenseAgreementMember 2021-05-01 2021-05-31 0001662579 cccc:RocheAgreementMember 2021-04-01 2021-06-30 0001662579 cccc:RocheAgreementMember 2020-04-01 2020-06-30 0001662579 cccc:RocheAgreementMember 2021-01-01 2021-06-30 0001662579 cccc:RocheAgreementMember 2020-01-01 2020-06-30 0001662579 cccc:BiogenAgreementMember 2021-04-01 2021-06-30 0001662579 cccc:BiogenAgreementMember 2020-04-01 2020-06-30 0001662579 cccc:BiogenAgreementMember 2021-01-01 2021-06-30 0001662579 cccc:BiogenAgreementMember 2020-01-01 2020-06-30 0001662579 cccc:CalicoAgreementMember 2021-04-01 2021-06-30 0001662579 cccc:CalicoAgreementMember 2020-04-01 2020-06-30 0001662579 cccc:CalicoAgreementMember 2021-01-01 2021-06-30 0001662579 cccc:CalicoAgreementMember 2020-01-01 2020-06-30 0001662579 cccc:RocheAgreementMember 2021-06-30 0001662579 cccc:BiogenAgreementMember 2021-06-30 0001662579 cccc:CalicoAgreementMember 2021-06-30 0001662579 cccc:RocheAgreementMember 2020-12-31 0001662579 cccc:BiogenAgreementMember 2020-12-31 0001662579 cccc:CalicoAgreementMember 2020-12-31 0001662579 cccc:RestatedRocheAgreementBiogenLicenseAgreementAndCalicoLicenseAgreementMember 2021-01-01 2021-06-30 0001662579 cccc:TermLoanMember cccc:CreditAgreementWithPerceptiveLifeSciencesMasterFundLTDMember 2020-06-05 0001662579 cccc:TrancheOneMember cccc:TermLoanMember cccc:CreditAgreementWithPerceptiveLifeSciencesMasterFundLTDMember 2020-06-05 0001662579 cccc:TrancheTwoMember cccc:TermLoanMember cccc:CreditAgreementWithPerceptiveLifeSciencesMasterFundLTDMember 2020-06-05 0001662579 cccc:TrancheOneMember cccc:TermLoanMember cccc:CreditAgreementWithPerceptiveLifeSciencesMasterFundLTDMember 2021-06-30 0001662579 cccc:TermLoanMember cccc:CreditAgreementWithPerceptiveLifeSciencesMasterFundLTDMember 2021-01-01 2021-06-30 0001662579 cccc:TermLoanMember cccc:CreditAgreementWithPerceptiveLifeSciencesMasterFundLTDMember 2020-06-05 2020-06-05 0001662579 srt:MinimumMember cccc:TermLoanMember cccc:CreditAgreementWithPerceptiveLifeSciencesMasterFundLTDMember 2020-06-05 0001662579 us-gaap:CommonStockMember srt:MaximumMember cccc:TermLoanMember 2021-06-30 0001662579 us-gaap:CommonStockMember cccc:TermLoanMember 2021-06-30 0001662579 2020-10-31 0001662579 us-gaap:CommonStockMember us-gaap:IPOMember cccc:UnderwritersMember 2020-10-06 2020-10-06 0001662579 us-gaap:CommonStockMember cccc:FollowOnOfferingMember 2021-06-01 2021-06-30 0001662579 us-gaap:CommonStockMember cccc:FollowOnOfferingMember cccc:UnderwritersMember 2021-06-01 2021-06-30 0001662579 srt:MaximumMember us-gaap:CommonStockMember 2021-06-30 0001662579 us-gaap:CommonStockMember 2021-05-01 2021-05-31 0001662579 cccc:TwoThousandFifteenIncentiveStockOptionAndGrantPlanMember 2021-06-30 0001662579 cccc:TwoThousandAndTwentyStockOptionAndIncentivePlanMember 2021-06-30 0001662579 2020-03-03 2020-03-03 0001662579 us-gaap:ResearchAndDevelopmentExpenseMember 2021-04-01 2021-06-30 0001662579 us-gaap:ResearchAndDevelopmentExpenseMember 2020-04-01 2020-06-30 0001662579 us-gaap:ResearchAndDevelopmentExpenseMember 2021-01-01 2021-06-30 0001662579 us-gaap:ResearchAndDevelopmentExpenseMember 2020-01-01 2020-06-30 0001662579 us-gaap:GeneralAndAdministrativeExpenseMember 2021-04-01 2021-06-30 0001662579 us-gaap:GeneralAndAdministrativeExpenseMember 2020-04-01 2020-06-30 0001662579 us-gaap:GeneralAndAdministrativeExpenseMember 2021-01-01 2021-06-30 0001662579 us-gaap:GeneralAndAdministrativeExpenseMember 2020-01-01 2020-06-30 0001662579 cccc:SeriesSeedRedeemableConvertiblePreferredStockMember 2020-01-01 2020-06-30 0001662579 us-gaap:SeriesAPreferredStockMember 2020-01-01 2020-06-30 0001662579 us-gaap:SeriesBPreferredStockMember 2020-01-01 2020-06-30 0001662579 cccc:WarrantToPurchaseCommonStockMember 2020-01-01 2020-06-30 0001662579 cccc:OptionsToPurchaseCommonStockMember 2021-01-01 2021-06-30 0001662579 cccc:OptionsToPurchaseCommonStockMember 2020-01-01 2020-06-30

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2021

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________________ to ___________________

Commission File Number: 001-39567

 

C4 Therapeutics, Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

47-5617627

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

 

 

490 Arsenal Way, Suite 200

Watertown, MA

02472

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (617231-0700

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common Stock, $0.0001 par value per share

 

CCCC

 

The Nasdaq Global Select Market

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).     Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

  

Accelerated filer

 

 

 

 

 

Non-accelerated filer

 

  

Smaller reporting company

 

 

 

 

 

 

 

 

 

 

 

 

Emerging growth company

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     Yes       No  

As of August 2, 2021, the registrant had 48,454,266 shares of common stock, $0.0001 par value per share, outstanding.

 

 


 

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, or Form 10-Q, including the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contains express or implied forward-looking statements that are based on our management’s belief and assumptions and on information currently available to our management. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements relate to future events or our future operational or financial performance, and involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by these forward-looking statements. Forward-looking statements in this Form 10-Q may include, but are not limited to, statements about:

 

the initiation, timing, progress, results, safety and efficacy, and cost of our research and development programs and our current and future preclinical studies and clinical trials, including statements regarding the timing of initiation and completion of studies or trials, the period during which the results of the trials will become available, and our research and development programs;

 

the ultimate impact of the coronavirus, or COVID-19, pandemic, or any other health epidemic, on our business, manufacturing, clinical trials, research programs, supply chain, regulatory review, healthcare systems or the global economy as a whole;

 

risks related to the direct or indirect impact of the COVID-19 pandemic or any future large-scale adverse health event, such as the scope and duration of the outbreak, government actions and restrictive measures implemented in response, material delays in diagnoses, initiation or continuation of treatment for diseases that may be addressed by our development candidates and investigational medicines, or in patient enrollment in clinical trials, potential clinical trials, regulatory review or supply chain disruptions, and other potential impacts to our business, the effectiveness or timeliness of steps taken by us to mitigate the impact of the pandemic, and our ability to execute business continuity plans to address disruptions caused by the COVID-19 pandemic or future large-scale adverse health event;

 

our ability to obtain funding for our operations necessary to complete further development, manufacturing and commercialization of our product candidates;

 

our ability to obtain and maintain regulatory approval for any of our current or future product candidates;

 

the period of time over which we anticipate our existing cash and cash equivalents, and marketable securities will be sufficient to fund our operating expenses and capital expenditure requirements;

 

our ability to identify and develop product candidates for treatment of additional disease indications;

 

the potential attributes and benefits of our product candidates;

 

the rate and degree of market acceptance and clinical utility for any product candidates we may develop;

 

the pricing and reimbursement of our product candidates, if approved;

 

the effects of competition with respect to any of our current or future product candidates, as well as innovations by current and future competitors in our industry;

 

the implementation of our strategic plans for our business, any product candidates we may develop and our TORPEDO™ platform;

 

the ability and willingness of our third-party strategic collaborators to continue research, development and manufacturing activities relating to our product candidates, including our ability to advance programs under our existing collaboration agreements with F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc., or Roche, Biogen MA, Inc., or Biogen, and Calico Life Sciences LLC, or Calico, or other new collaboration agreements;

 

the scope of protection we are able to establish and maintain for intellectual property rights covering our product candidates;

 

estimates of our future expenses, revenues, capital requirements, and our needs for additional financing;

 

future agreements with third parties in connection with the manufacturing and commercialization of our product candidates, if approved;

 

the size and growth potential of the markets for our product candidates and our ability to serve those markets;

 

our financial performance;

 

regulatory developments in the United States and foreign countries;

 

our ability to contract with third-party suppliers and manufacturers and their ability to perform adequately;

 


 

 

the success of competing therapies that are or may become available;

 

our ability to attract and retain key scientific or management personnel;

 

developments relating to our competitors and our industry; and

 

other risks and uncertainties, including those discussed in Part II, Item 1A - Risk Factors in this Form 10-Q.

In some cases, forward-looking statements can be identified by terminology such as “will,” “may,” “should,” “could,” “expects,” “intends,” “plans,” “aims,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue,” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors, which are, in some cases, beyond our control and which could materially affect results. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under the section titled “Risk Factors” and elsewhere in this Form 10-Q. If one or more of these risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those expressed or implied by the forward-looking statements. No forward-looking statement is a promise or a guarantee of future performance.

The forward-looking statements in this Form 10-Q represent our views as of the date of this Form 10-Q. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we have no current intention of doing so except to the extent required by applicable law. You should therefore not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this Form 10-Q.

This Form 10-Q may include statistical and other industry and market data that we obtained from industry publications and research, surveys, and studies conducted by third parties. Industry publications and third-party research, surveys, and studies generally indicate that their information has been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. We have not independently verified the information contained in such sources.

 


SUMMARY OF RISKS FACTORS

Our ability to implement our business strategy is subject to numerous risks that you should be aware of before making an investment decision. These risks are described more fully in Part II, Item 1A - Risk Factors in this Form 10-Q. These risks include, among others:

 

We are a clinical-stage biopharmaceutical company with a limited operating history and have incurred significant losses since our inception. To date, we have not generated any revenue from product sales. We expect to continue to incur significant expenses and increasing operating losses for at least the next several years and may never achieve or maintain profitability. Our net loss was $43.6 million and $22.7 million for the six months ended June 30, 2021 and 2020, respectively.

 

We will need substantial additional funding to pursue our business objectives and continue our operations. If we are unable to raise capital when needed, we may be required to delay, limit, reduce or terminate our research or product development programs or future commercialization efforts.

 

Our approach to the discovery and development of product candidates based on our TORPEDO™ platform is unproven, which makes it difficult to predict the time, cost of development and likelihood of successfully developing any products.

 

Most of our product candidates are still in preclinical development. Our business could be harmed if we are unable to advance to clinical development, develop, obtain regulatory approval for and/or commercialize our product candidates; if we experience significant delays in doing any of these things; or if we experience significant cost increases.

 

We cannot be certain of the timely completion or outcome of our preclinical testing and clinical trials. In addition, the results of preclinical studies may not be predictive of the results of clinical trials and the results of any early-stage clinical trials we commence may not be predictive of the results of later-stage clinical trials.

 

Our preclinical studies and clinical trials may fail to demonstrate adequately the safety, potency, purity and efficacy of any of our product candidates, which would prevent or delay development, regulatory approval and commercialization of our current and future product candidates.

 

We have entered into collaboration agreements with Roche, Biogen and Calico and may in the future seek to enter into collaborations with third parties for the development and/or commercialization of certain of our product candidates. If we fail to enter into these types of new collaborations, or if our existing collaborations are not successful, we may be unable to continue development of our product candidates, we will not receive any contemplated or potential future milestone payments or royalties, and we could fail to capitalize on the market potential of our product candidates.

 

The continuing effects of the COVID-19 pandemic, including the spread of new strains of the virus, could adversely impact our business, including our preclinical studies and clinical trials.

 

We face substantial competition, which may result in others discovering, developing or commercializing products before or more successfully than we do.

 

We rely, and expect to continue to rely, on third parties for the manufacture of our product candidates for preclinical and clinical testing, as well as for commercial manufacture if any of our product candidates receive marketing approval. This reliance on third parties may increase the risk that we will not have sufficient quantities of our product candidates in a timely manner, or at an acceptable cost or quality.

 

If we are unable to obtain required marketing approvals for, commercialize, manufacture, obtain and maintain patent protection for or gain market acceptance of our product candidates, or if we experience significant delays in doing so, our business will be materially harmed and our ability to generate revenue from product sales will be materially impaired.

 

If we are unable to obtain and maintain patent protection for our technology and products or if the scope of the patent protection obtained is not sufficiently broad, our competitors could develop and commercialize technology and products similar or identical to ours, and our ability to successfully commercialize our technology and products may be impaired.

 


 

NOTE REGARDING COMPANY REFERENCES

Unless the context otherwise requires, the terms “C4 Therapeutics,” “the Company,” “we,” “us,” and “our” in this Form 10-Q refer to C4 Therapeutics, Inc. and its consolidated subsidiary.

NOTE REGARDING TRADEMARKS

We own or have rights to various trademarks, service marks and trade names that are used in connection with the operation of our business, including our company name, C4 Therapeutics, our logo, the name of our TORPEDO™ technology platform and the names of our BIDAC™ and MONODAC™ protein degrader product candidates. This Form 10-Q may also contain trademarks, service marks and trade names of third parties, which are the property of their respective owners. Our use or display of third parties’ trademarks, service marks, trade names or products in this prospectus is not intended to and does not imply a relationship with, or endorsement or sponsorship by us. Solely for convenience, the trademarks, service marks and trade names referred to in this prospectus may appear without the ®, TM or SM symbols, but the omission of such references is not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable owner of these trademarks, service marks and trade names.

 

 

 

 


 

Table of Contents

 

 

 

Page

PART I.

FINANCIAL INFORMATION

 

Item 1.

Financial Statements (Unaudited)

1

 

Condensed Consolidated Balance Sheets

1

 

Condensed Consolidated Statement of Operations and Comprehensive Loss

2

 

Condensed Consolidated Statement of Stockholder’s Equity (Deficit)

3

 

Condensed Consolidated Statements of Cash Flows

5

 

Notes to Unaudited Condensed Consolidated Financial Statements

7

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

18

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

26

Item 4.

Controls and Procedures

27

PART II.

OTHER INFORMATION

 

Item 1.

Legal Proceedings

28

Item 1A.

Risk Factors

28

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

68

Item 3.

Defaults Upon Senior Securities

68

Item 4.

Mine Safety Disclosures

68

Item 5.

Other Information

68

Item 6.

Exhibits

69

 

SIGNATURES

70

 

 

 

i

 


 

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

C4 Therapeutics, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share amounts)

(Unaudited)

 

 

 

June 30,

2021

 

 

December 31,

2020

 

Assets

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

281,146

 

 

$

181,727

 

Marketable securities, current

 

 

184,765

 

 

 

189,962

 

Accounts receivable

 

 

6,213

 

 

 

4,484

 

Prepaid expenses and other current assets

 

 

5,437

 

 

 

4,836

 

Total current assets

 

 

477,561

 

 

 

381,009

 

Marketable securities, non-current

 

 

32,770

 

 

 

 

Property and equipment, net

 

 

3,653

 

 

 

3,323

 

Right-of-use asset

 

 

12,582

 

 

 

13,229

 

Restricted cash

 

 

1,276

 

 

 

2,577

 

Other assets

 

 

579

 

 

 

 

Total assets

 

$

528,421

 

 

$

400,138

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

4,469

 

 

$

5,683

 

Accrued expenses and other current liabilities

 

 

9,871

 

 

 

9,524

 

Deferred revenue, current

 

 

28,695

 

 

 

27,603

 

Operating lease liability, current

 

 

1,131

 

 

 

1,042

 

Total current liabilities

 

 

44,166

 

 

 

43,852

 

Deferred revenue, net of current

 

 

46,189

 

 

 

53,617

 

Operating lease liability, net of current

 

 

11,230

 

 

 

11,826

 

Long-term debt related party

 

 

10,409

 

 

 

10,052

 

Total liabilities

 

 

111,994

 

 

 

119,347

 

Commitments and contingencies

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

Preferred stock, par value of $0.0001 per share; 10,000,000 shares authorized, and no shares issued or outstanding as of June 30, 2021 and December 31, 2020, respectively

 

 

 

 

 

 

Common stock, par value of $0.0001 per share; 150,000,000 shares authorized, and 48,380,059 and 43,059,632 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively

 

 

5

 

 

 

4

 

Additional paid-in capital

 

 

643,865

 

 

 

464,597

 

Accumulated other comprehensive (loss) income

 

 

(69

)

 

 

13

 

Accumulated deficit

 

 

(227,374

)

 

 

(183,823

)

Total stockholders’ equity

 

 

416,427

 

 

 

280,791

 

Total liabilities and stockholders’ equity

 

$

528,421

 

 

$

400,138

 

See accompanying notes to condensed consolidated financial statements.

1


C4 Therapeutics, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except share and per share amounts)

(Unaudited)

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Revenue from collaboration agreements

 

$

9,781

 

 

$

9,670

 

 

$

17,207

 

 

$

16,486

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

23,286

 

 

 

17,760

 

 

 

43,812

 

 

 

34,072

 

General and administrative

 

 

8,611

 

 

 

2,769

 

 

 

16,020

 

 

 

5,611

 

Total operating expenses

 

 

31,897

 

 

 

20,529

 

 

 

59,832

 

 

 

39,683

 

Loss from operations

 

 

(22,116

)

 

 

(10,859

)

 

 

(42,625

)

 

 

(23,197

)

Other (expense) income, net:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense and amortization of long-term debt − related party

 

 

(533

)

 

 

(127

)

 

 

(1,067

)

 

 

(127

)

Interest and other income, net

 

 

69

 

 

 

25

 

 

 

141

 

 

 

284

 

Total other (expense) income, net

 

 

(464

)

 

 

(102

)

 

 

(926

)

 

 

157

 

Loss before income taxes

 

 

(22,580

)

 

 

(10,961

)

 

 

(43,551

)

 

 

(23,040

)

Income tax benefit

 

 

 

 

 

168

 

 

 

 

 

 

335

 

Net loss

 

$

(22,580

)

 

$

(10,793

)

 

$

(43,551

)

 

$

(22,705

)

Unrealized gain (loss) on marketable securities

 

 

25

 

 

 

(2

)

 

 

(82

)

 

 

(2

)

Comprehensive loss

 

$

(22,555

)

 

$

(10,795

)

 

$

(43,633

)

 

$

(22,707

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of net loss to net loss attributable to common stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

$

(22,580

)

 

$

(10,793

)

 

$

(43,551

)

 

$

(22,705

)

Accrual of preferred stock dividends

 

 

 

 

 

(2,908

)

 

 

 

 

 

(5,019

)

Net loss attributable to common stockholders

 

$

(22,580

)

 

$

(13,701

)

 

$

(43,551

)

 

$

(27,724

)

Net loss per share attributable to common stockholders − basic and diluted

 

$

(0.51

)

 

$

(9.28

)

 

$

(1.00

)

 

$

(18.87

)

Weighted-average number of shares used in computed net loss per share − basic and diluted

 

 

43,855,420

 

 

 

1,476,378

 

 

 

43,472,327

 

 

 

1,469,571

 

See accompanying notes to condensed consolidated financial statements.

 

 

2

 


 

C4 Therapeutics, Inc.

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

(in thousands, except share amounts)

(Unaudited)

 

 

 

Common Stock

 

 

Additional

Paid-In

 

 

Accumulated

Other

Comprehensive

 

 

Accumulated

 

 

Total

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Income (Loss)

 

 

Deficit

 

 

Equity

 

Balance as of December 31, 2020

 

 

43,059,632

 

 

$

4

 

 

$

464,597

 

 

 

13

 

 

$

(183,823

)

 

$

280,791

 

Exercise of stock options

 

 

49,328

 

 

 

 

 

 

166

 

 

 

 

 

 

 

 

 

166

 

Stock-based compensation

 

 

 

 

 

 

 

 

3,845

 

 

 

 

 

 

 

 

 

3,845

 

Unrealized loss on marketable securities

 

 

 

 

 

 

 

 

 

 

 

(107

)

 

 

 

 

 

(107

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(20,971

)

 

 

(20,971

)

Other

 

 

 

 

 

 

 

 

(19

)

 

 

 

 

 

 

 

 

(19

)

Balance as of March 31, 2021

 

 

43,108,960

 

 

$

4

 

 

$

468,589

 

 

$

(94

)

 

$

(204,794

)

 

$

263,705

 

Issuance of common stock, net of estimated issuance costs of $11.3 million (Note 10)

 

 

4,887,500

 

 

 

1

 

 

 

169,482

 

 

 

 

 

 

 

 

 

169,483

 

Shares issued upon warrant exercise − related party (Note 10)

 

 

256,038

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercise of stock options

 

 

126,150

 

 

 

 

 

 

539

 

 

 

 

 

 

 

 

 

539

 

Stock-based compensation

 

 

 

 

 

 

 

 

5,175

 

 

 

 

 

 

 

 

 

5,175

 

Unrealized gain on marketable securities

 

 

 

 

 

 

 

 

 

 

 

25

 

 

 

 

 

 

25

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(22,580

)

 

 

(22,580

)

Other

 

 

1,411

 

 

 

 

 

 

80

 

 

 

 

 

 

 

 

 

80

 

Balance as of June 30, 2021

 

 

48,380,059

 

 

$

5

 

 

$

643,865

 

 

$

(69

)

 

$

(227,374

)

 

$

416,427

 

See accompanying notes to condensed consolidated financial statements.

3


C4 Therapeutics, Inc.

Condensed Consolidated Statements of Stockholders’ Equity (Deficit) - Continued

(in thousands, except share amounts)

(Unaudited)

 

 

 

Redeemable Convertible Preferred Stock

 

 

 

Common Stock

 

 

Additional

Paid-In

 

 

Accumulated

Other

Comprehensive

 

 

Accumulated

 

 

Total

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Income (Loss)

 

 

Deficit

 

 

Deficit

 

Balance as of December 31, 2019

 

 

113,145,900

 

 

$

110,995

 

 

 

 

1,426,641

 

 

$

 

 

$

5,525

 

 

$

 

 

$

(117,488

)

 

$

(111,963

)

Exercise of stock options

 

 

 

 

 

 

 

 

 

49,031

 

 

 

 

 

 

156

 

 

 

 

 

 

 

 

 

156

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

116

 

 

 

 

 

 

 

 

 

116

 

Repurchase of common stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(202

)

 

 

 

 

 

 

 

 

(202

)

Vested stock option settlement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(728

)

 

 

 

 

 

 

 

 

(728

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(11,912

)

 

 

(11,912

)

Balance as of March 31, 2020

 

 

113,145,900

 

 

$

110,995

 

 

 

 

1,475,672

 

 

$

 

 

$

4,867

 

 

$

 

 

$

(129,400

)

 

$

(124,533

)

Issuance of Series B redeemable convertible preferred stock, net of issuance costs of $4.5 million

 

 

138,571,428

 

 

 

141,026

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exercise of stock options

 

 

 

 

 

 

 

 

 

38,378

 

 

 

 

 

 

109

 

 

 

 

 

 

 

 

 

109

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

161

 

 

 

 

 

 

 

 

 

161

 

Repurchase of common stock

 

 

 

 

 

 

 

 

 

(23,714

)

 

 

 

 

 

78

 

 

 

 

 

 

 

 

 

78

 

Vested stock option settlement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(85

)

 

 

 

 

 

 

 

 

(85

)

Unrealized loss on marketable securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2

)

 

 

 

 

 

(2

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(10,793

)

 

 

(10,793

)

Balance as of June 30, 2020

 

 

251,717,328

 

 

$

252,021

 

 

 

 

1,490,336

 

 

$

 

 

$

5,130

 

 

$

(2

)

 

$

(140,193

)

 

$

(135,065

)

See accompanying notes to condensed consolidated financial statements.

 

 

4

 


 

 

C4 Therapeutics, Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(Unaudited)

 

 

 

Six Months Ended June 30,

 

 

 

2021

 

 

2020

 

Cash flows used in operating activities:

 

 

 

 

 

 

 

 

Net loss

 

$

(43,551

)

 

$

(22,705

)

Adjustments to reconcile net loss to cash provided by (used in) operating activities:

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

9,073

 

 

 

277

 

Depreciation expense

 

 

839

 

 

 

832

 

Reduction in carrying amount of right-of-use asset

 

 

647

 

 

 

600

 

Accretion of discount on marketable securities

 

 

474

 

 

 

 

Amortization of debt discount − related party

 

 

360

 

 

 

25

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(1,729

)

 

 

(3,923

)

Prepaid expenses and other current and long-term assets

 

 

(1,181

)

 

 

(1,651

)

Accounts payable

 

 

(1,338

)

 

 

462

 

Accrued expenses and other current liabilities

 

 

316

 

 

 

(628

)

Operating lease liability

 

 

(508

)

 

 

(429

)

Deferred revenue

 

 

(6,338

)

 

 

(4,120

)

Net cash used in operating activities

 

 

(42,936

)

 

 

(31,260

)

Cash flows used in investing activities:

 

 

 

 

 

 

 

 

Proceeds from maturities of marketable securities

 

 

209,494

 

 

 

 

Purchases of marketable securities

 

 

(237,622

)