ProKidney Reports Second Quarter Financial Results and Recent Corporate Highlights
ProKidney Corp., a well-known advanced-stage cellular therapeutics company specializing in improving the quality of life for individuals with chronic kidney disease (CKD), has released its financial outcomes for the period ending on June 30, 2023. Additionally, the company has shared an update regarding recent progress in its operations.
"In the second quarter, and throughout the first half of 2023, we made steady progress in our REACT development programs, including our initial Phase 3 study, proact 1, which is examining the possibility of REACT delaying or stopping the advancement of moderate to severe diabetic CKD," stated Dr. Tim Bertram, CEO of ProKidney. "Looking ahead, we anticipate reaching several significant milestones in the upcoming months. This includes updated interim data from our Phase 2 RMCL-002 study in the latter part of 2023, which may enhance our understanding of the long-lasting kidney function preservation observed with REACT in patients with advanced stage CKD. By the end of 2023, we also plan to provide an update on the progress of participants in our open-label Phase 2 REGEN-007 study of REACT. This study aims to shed light on the potential kidney outcomes of our commercial REACT formulation when injected into both kidneys. We believe that these results will provide valuable insights into the capacity of REACT to preserve kidney health and delay the need for dialysis in patients with advanced CKD. As for our progress towards becoming a commercial organization, we recently achieved an important milestone with the acquisition of the Greensboro facility. This acquisition is expected to expand our manufacturing capacity in preparation for a potential commercial launch of REACT, pending regulatory approval."
Latest news from our company and updates on the progress of our clinical development for REACT®.
We have recently acquired a large facility and a considerable amount of land in Greensboro, N.C., which will be used to meet our future manufacturing needs for REACT. As part of this purchase, we have also received a package of incentives, including tax credits of around $33.7 million and energy credits of about $1.9 million from Duke Energy. However, these incentives are contingent upon us meeting specific goals, such as creating at least 330 new jobs by December 31, 2028, and investing approximately $458 million in real and personal property by December 31, 2027.
We are currently accepting participants for proact 1, a Phase 3 experiment that is randomized, blinded, and sham-controlled. This study will assess the effects of administering REACT, a medication, in two different doses. The doses will be given three months apart, with one dose being injected into each kidney. We aim to include 600 patients in this study, who will be recruited from various locations in the U.S., UK, and some other chosen countries that have a high likelihood of developing kidney failure. We anticipate obtaining preliminary data by the end of 2024.
ProKidney is taking further steps to prepare for enrolling patients in the proact 2 study. This study is a Phase 3 trial that aims to evaluate the safety and effectiveness of up to two REACT injections for patients in the EU, Latin America, and Asia Pacific regions. The injections will be given three months apart and delivered to each kidney. The Company has made some changes to the study's protocol to align with current medical practices, ongoing regulatory discussions, and to support potential commercial access. These adjustments include extending the follow-up period to 60 months and categorizing patients based on their CKD stage and use of SGLT2 or sMRA. The protocols have been approved in several countries, such as Australia, Belgium, Brazil, Columbia, France, Italy, Malaysia, Portugal, Singapore, and Spain. ProKidney plans to start enrolling patients in the second half of 2023, and we can expect initial interim results by the end of 2025.
I showcased a poster highlighting the patient demographics of REGEN-007 at the 60th European Renal Association (ERA) Congress.
Financial performance in Q2 2023 Let's take a look at the key financial highlights for the second quarter of 2023.
The available funds, which consist of cash, assets easily convertible to cash, and securities that can be sold on the market, amounted to $446.1 million as of June 30, 2023. This figure is lower than the $490.3 million recorded on December 31, 2022.
R&D Costs: Our expenses for research and development reached $26.4 million from April to June 2023, compared to $11.6 million during the same period in 2022. The surge of $14.8 million was primarily due to higher expenses in compensation, both in cash and equity, amounting to approximately $5.9 million. This is a result of our continuous hiring of additional staff in clinical development, quality, manufacturing, and biostatistics to strengthen our ongoing clinical trials and expand our commercial manufacturing capabilities. Moreover, clinical trial costs have also risen by approximately $6.2 million, primarily driven by our Phase 3 program and the implementation of our REGEN-007 clinical trial.
G&A Costs: The expenses for general and administrative activities amounted to $13.5 million during the three-month period that concluded on June 30, 2023. This figure marks a notable difference from the same period in 2022, where the costs were $9.2 million. The surge of $4.3 million can be mainly attributed to higher expenditures in legal services and insurance fees linked to our operations as a publicly traded entity. Additionally, professional fees incurred due to our intended expansion in commercial scale manufacturing also contributed to the increase.
Losses before accounting for noncontrolling interest amounted to $34.8 million and $22.1 million for the three-month periods ending on June 30, 2023, and 2022, respectively.
Number of shares: As of June 30, 2023, the total count of Class A and Class B ordinary shares outstanding was 235,253,658.
ProKidney is a company that focuses on finding new ways to treat Chronic Kidney Disease (CKD) using advanced cellular therapy methods. The company was established in 2015 after conducting research for ten years. Their main product, REACT® (Renal Autologous Cell Therapy), is a unique and patented cellular therapy that could potentially help preserve kidney function in patients who are at a high risk of kidney failure. Patients in the late stages of CKD, specifically Stage 3b to 4, are the main focus for REACT treatment. The therapy has been given the Regenerative Medicine Advanced Therapy (RMAT) designation, and it has received guidance from both the FDA and EMA. This support has enabled ProKidney to carry out Phase 3 clinical trials for REACT, which began in January 2022. For more information, please visit the ProKidney website at www.prokidney.com.
This press release contains statements about the future that are based on ProKidney's expectations, estimates, and projections. However, the actual results may be different from these statements, so it is not advisable to rely on them as predictions of future events. Words like "expect," "estimate," "project," "forecast," and more are used to identify these forward-looking statements. ProKidney's forward-looking statements include its expectations for financial results, product development and commercialization, regulatory approvals, market size and growth, and funding for developmental programs. Many of these factors are beyond ProKidney's control and difficult to predict. Potential reasons for differences include being unable to maintain the listing of the company's shares, challenges in implementing business plans, competition, regulatory changes, difficulties in raising financing, failure to obtain regulatory clearance or approval, and more. ProKidney advises readers not to solely rely on these forward-looking statements and does not assume any obligation to update them in the future.
Corporate: Glenn Schulman, a licensed pharmacist and holder of a Master's degree in Public Health, is currently employed in the role of Senior Vice President of Investor Relations at ProKidney. He can be contacted via email at [email protected].
Investors: Burns McClellan has introduced new members to their team, namely Lee Roth and Julia Weilman. To get in touch with Lee Roth, you can reach out via email at [email protected]. Alternatively, if you wish to contact Julia Weilman, please use the email [email protected].
Press Release: Burns McClellan, in partnership with Selina Husain and Robert Flamm, Ph.D., released a statement regarding media matters. For further inquiries, please reach out to [email protected] or [email protected].
ProKidney Corp. and its affiliated companiesCombined Balance Sheets(in thousands, except for the number of shares)
Money and readily-convertible assets
Net assets resulting from the right to use.
Debts and Stakeholders' Negative Assets/Partners' Equity
accrued liabilities and miscellaneous expenses
Amount owed for income taxes, after subtracting the current portion
Lease obligations, minus the amount due within the next year
Net deficit of owners / partners. This term refers to the difference between the total liabilities and the total assets of a company that is owned by its shareholders or members. It shows the amount of money that the owners or partners have invested in the company, compared to the company’s debts and other obligations. The shareholders’ deficit or members' equity can be either positive or negative, depending on whether the company’s assets outweigh its liabilities or vice versa. Positive equity indicates that the company has more assets than debts, while negative equity indicates that the company has more debts than assets.
There are two types of shares available: Class A ordinary shares. These shares have a par value of $0.0001. The total number of authorized shares is 500,000,000. As of June 30, 2023, there are 61,590,231 shares that have been issued and are currently held by shareholders. As of December 31, 2022, there were 61,540,231 shares issued and held by shareholders.
We have authorized 500,000,000 Class B ordinary shares with a par value of $0.0001. As of June 30, 2023, there are 173,663,427 shares issued and outstanding. As of December 31, 2022, there were 171,578,320 shares issued and outstanding.
Total amount of losses/deficits, not included in the main profit or loss statement, that have been recorded and added together.
The overall shortfall of shareholders' investments / members' worth in a company.
Total debts and the negative value of shares/ownership.
ProKidney Corp. and its affiliated companies together present the Consolidated Statements of Operations and Comprehensive Loss. The amounts presented are in thousands, except for share and per share data.
The time period spanning from April to June has come to a close on June 30th.
The period of time that concluded on June 30th after six months.
The downwards result prior to applying income tax
Negative net loss prior to noncontrolling interest
Net decrease in earnings allocated to parties without controlling interest.
The deficit that the Class A ordinary shareholders can claim as their own.
The total number of Class A ordinary shares outstanding that are taken into account, considering their relative importance.
Loss per share for each Class A ordinary share: (1)
The company examined the calculation of net loss per share for periods before merging with Social Capital Suvretta Holdings Corp. III (the "Business Combination") on July 11, 2022. After analyzing it, they concluded that the values obtained were not significant for those who use the consolidated financial statements. This is because the capital structure underwent a complete transformation due to the Business Combination. As a result, information on net loss per share is not provided for periods before the Business Combination.
ProKidney Corp. and its subsidiaries' combined cash flow statement(amounts in thousands)
Six-month duration concluding on June 30th,
The movement of money originating from the daily activities of a business.
Loss before minority interest
Changes made to bring the net loss before considering noncontrolling interest in line with the net cash flows utilized in operating activities:
Profit from investments in easily tradeable financial assets, after deducting any related expenses or losses.
Cost incurred from getting rid of equipment
Alterations in the management of resources and debts.
Prepaid expenses and additional resources
Outstanding payments and accumulated liabilities
Cash flow from operating activities Net cash outflows generated from operational activities
Funds expended in investment undertakings
Acquisition of tradable stocks and bonds
The trading of easily sellable investments
Buying new equipment and expanding our facilities.
Cash outflows from investing activities
Financial inflows from activities related to financing
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Loans acquired through affiliated party promissory notes.
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Money, starting of the period
Money, at the conclusion of the cycle
Additional disclosure of non-cash investment activities:
Assets acquired in return for lease commitments
Effects of equity transactions and remuneration on redeemable noncontrolling stake.
Fluctuation in the redemption worth of minority ownership
Additional machinery and resources incorporated into the outstanding debts and incurred costs.
