aldr-10q_20190630.htm
false 2019 Q2 ALDER BIOPHARMACEUTICALS INC 0001423824 --12-31 Large Accelerated Filer false 900134860 aldr:CollaborationAndLicenseAgreementsMember aldr:CollaborationAndLicenseAgreementsMember aldr:CollaborationAndLicenseAgreementsMember aldr:CollaborationAndLicenseAgreementsMember true P7Y P3M 900134860 aldr:CollaborationAndLicenseAgreementsMember aldr:CollaborationAndLicenseAgreementsMember aldr:CollaborationAndLicenseAgreementsMember aldr:CollaborationAndLicenseAgreementsMember P4Y1M6D 0001423824 2019-01-01 2019-06-30 xbrli:shares 0001423824 2019-08-02 iso4217:USD 0001423824 2019-06-30 0001423824 2018-12-31 0001423824 aldr:ClassAOneConvertiblePreferredStockMember 2019-06-30 0001423824 aldr:ClassAOneConvertiblePreferredStockMember 2018-12-31 iso4217:USD xbrli:shares 0001423824 2019-04-01 2019-06-30 0001423824 2018-04-01 2018-06-30 0001423824 2018-01-01 2018-06-30 0001423824 aldr:SeriesAOneConvertiblePreferredStockMember 2018-01-01 2018-06-30 0001423824 aldr:SeriesAOneConvertiblePreferredStockMember 2018-06-30 0001423824 aldr:SeriesAOneConvertiblePreferredStockMember 2018-12-31 0001423824 aldr:SeriesAOneConvertiblePreferredStockMember 2019-01-01 2019-06-30 0001423824 aldr:SeriesAOneConvertiblePreferredStockMember 2019-06-30 0001423824 us-gaap:CommonStockMember 2017-12-31 0001423824 us-gaap:AdditionalPaidInCapitalMember 2017-12-31 0001423824 us-gaap:RetainedEarningsMember 2017-12-31 0001423824 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2017-12-31 0001423824 2017-12-31 0001423824 us-gaap:RetainedEarningsMember 2018-01-01 2018-06-30 0001423824 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-01-01 2018-06-30 0001423824 us-gaap:AdditionalPaidInCapitalMember 2018-01-01 2018-06-30 0001423824 us-gaap:CommonStockMember 2018-01-01 2018-06-30 0001423824 us-gaap:CommonStockMember 2018-06-30 0001423824 us-gaap:AdditionalPaidInCapitalMember 2018-06-30 0001423824 us-gaap:RetainedEarningsMember 2018-06-30 0001423824 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-06-30 0001423824 2018-06-30 0001423824 us-gaap:CommonStockMember 2018-12-31 0001423824 us-gaap:AdditionalPaidInCapitalMember 2018-12-31 0001423824 us-gaap:RetainedEarningsMember 2018-12-31 0001423824 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-12-31 0001423824 us-gaap:RetainedEarningsMember 2019-01-01 2019-06-30 0001423824 us-gaap:AdditionalPaidInCapitalMember 2019-01-01 2019-06-30 0001423824 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-01-01 2019-06-30 0001423824 us-gaap:CommonStockMember 2019-01-01 2019-06-30 0001423824 us-gaap:CommonStockMember 2019-06-30 0001423824 us-gaap:AdditionalPaidInCapitalMember 2019-06-30 0001423824 us-gaap:RetainedEarningsMember 2019-06-30 0001423824 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-06-30 0001423824 2019-03-04 2019-03-04 0001423824 us-gaap:OverAllotmentOptionMember 2019-03-04 2019-03-04 0001423824 us-gaap:PrivatePlacementMember aldr:RedmileGroupLLCMember 2019-03-04 2019-03-04 aldr:Segment aldr:Country xbrli:pure 0001423824 aldr:TwoPointFivePercentConvertibleSeniorNotesDueFebruaryOneTwoThousandAndTwentyFiveMember 2019-06-30 0001423824 aldr:TwoPointFivePercentConvertibleSeniorNotesDueFebruaryOneTwoThousandAndTwentyFiveMember 2019-01-01 2019-06-30 0001423824 2019-01-01 0001423824 aldr:LongTermIncentivePlanMember 2019-01-01 2019-06-30 0001423824 aldr:LongTermIncentivePlanMember 2019-06-30 0001423824 aldr:TwoThousandAndEighteenInducementAwardPlanMember 2019-06-20 2019-06-20 0001423824 aldr:TwoThousandAndEighteenInducementAwardPlanMember 2019-06-20 0001423824 aldr:TwoThousandAndEighteenInducementAwardPlanMember 2019-06-30 0001423824 aldr:AtTheMarketProgramMember aldr:DistributionAgreementMember srt:MaximumMember 2019-01-31 0001423824 us-gaap:PrivatePlacementMember 2019-03-04 2019-03-04 0001423824 aldr:TwoPointFivePercentConvertibleSeniorNotesDueFebruaryOneTwoThousandAndTwentyFiveMember 2019-04-01 2019-06-30 0001423824 aldr:TwoPointFivePercentConvertibleSeniorNotesDueFebruaryOneTwoThousandAndTwentyFiveMember 2018-04-01 2018-06-30 0001423824 aldr:TwoPointFivePercentConvertibleSeniorNotesDueFebruaryOneTwoThousandAndTwentyFiveMember 2018-01-01 2018-06-30 0001423824 us-gaap:ConvertiblePreferredStockMember 2019-04-01 2019-06-30 0001423824 us-gaap:ConvertiblePreferredStockMember 2018-04-01 2018-06-30 0001423824 us-gaap:ConvertiblePreferredStockMember 2019-01-01 2019-06-30 0001423824 us-gaap:ConvertiblePreferredStockMember 2018-01-01 2018-06-30 0001423824 aldr:StockOptionsStockAwardsAndSharesUnderEmployeeStockPurchasePlanMember 2019-04-01 2019-06-30 0001423824 aldr:StockOptionsStockAwardsAndSharesUnderEmployeeStockPurchasePlanMember 2018-04-01 2018-06-30 0001423824 aldr:StockOptionsStockAwardsAndSharesUnderEmployeeStockPurchasePlanMember 2019-01-01 2019-06-30 0001423824 aldr:StockOptionsStockAwardsAndSharesUnderEmployeeStockPurchasePlanMember 2018-01-01 2018-06-30 0001423824 aldr:USGovernmentAgencyObligationsMaturingInOneYearOrLessMember 2019-06-30 0001423824 aldr:USGovernmentAgencyObligationsMaturingInOneYearOrLessMember 2018-12-31 0001423824 us-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember 2016-01-01 2016-12-31 0001423824 us-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember 2018-01-01 2018-12-31 0001423824 us-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember 2017-11-01 2017-11-30 0001423824 us-gaap:MoneyMarketFundsMember us-gaap:FairValueInputsLevel1Member 2019-06-30 0001423824 us-gaap:MoneyMarketFundsMember 2019-06-30 0001423824 us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMember us-gaap:FairValueInputsLevel2Member 2019-06-30 0001423824 us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMember 2019-06-30 0001423824 us-gaap:BankTimeDepositsMember us-gaap:FairValueInputsLevel1Member 2019-06-30 0001423824 us-gaap:BankTimeDepositsMember 2019-06-30 0001423824 us-gaap:FairValueInputsLevel1Member 2019-06-30 0001423824 us-gaap:FairValueInputsLevel2Member 2019-06-30 0001423824 us-gaap:FairValueInputsLevel2Member aldr:TwoThousandTwentyFiveConvertibleSeniorNotesMember 2019-06-30 0001423824 aldr:TwoThousandTwentyFiveConvertibleSeniorNotesMember 2019-06-30 0001423824 us-gaap:FairValueInputsLevel3Member 2019-06-30 0001423824 us-gaap:MoneyMarketFundsMember us-gaap:FairValueInputsLevel1Member 2018-12-31 0001423824 us-gaap:MoneyMarketFundsMember 2018-12-31 0001423824 us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMember us-gaap:FairValueInputsLevel2Member 2018-12-31 0001423824 us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMember 2018-12-31 0001423824 us-gaap:FairValueInputsLevel1Member 2018-12-31 0001423824 us-gaap:FairValueInputsLevel2Member 2018-12-31 0001423824 us-gaap:FairValueInputsLevel2Member aldr:TwoThousandTwentyFiveConvertibleSeniorNotesMember 2018-12-31 0001423824 aldr:TwoThousandTwentyFiveConvertibleSeniorNotesMember 2018-12-31 0001423824 us-gaap:FairValueInputsLevel3Member 2018-12-31 0001423824 us-gaap:ConvertibleDebtMember aldr:TwoThousandTwentyFiveConvertibleSeniorNotesMember 2018-02-01 0001423824 us-gaap:ConvertibleDebtMember aldr:TwoThousandTwentyFiveConvertibleSeniorNotesMember 2018-02-13 0001423824 us-gaap:ConvertibleDebtMember 2019-06-30 0001423824 us-gaap:ConvertibleDebtMember 2019-01-01 2019-06-30 aldr:trading_day 0001423824 us-gaap:ConvertibleDebtMember aldr:DebtInstrumentConvertibleTermsOfConversionFeatureCircumstancesOneMember 2018-01-01 2018-03-31 0001423824 us-gaap:ConvertibleDebtMember aldr:DebtInstrumentConvertibleTermsOfConversionFeatureCircumstancesTwoMember 2019-01-01 2019-06-30 0001423824 us-gaap:ConvertibleDebtMember aldr:DebtInstrumentRedemptionPeriodOnOrAfterFebruaryOneTwoThousandTwentyTwoMember 2019-01-01 2019-06-30 0001423824 us-gaap:ConvertibleDebtMember 2019-04-01 2019-06-30 0001423824 us-gaap:ConvertibleDebtMember 2018-04-01 2018-06-30 0001423824 us-gaap:ConvertibleDebtMember 2018-01-01 2018-06-30 0001423824 aldr:TwoThousandTwentyFiveConvertibleSeniorNotesMember us-gaap:ConvertibleDebtMember 2019-06-30 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember aldr:ClassAOneConvertiblePreferredStockMember us-gaap:PrivatePlacementMember 2018-01-11 2018-01-12 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember aldr:ClassAOneConvertiblePreferredStockMember us-gaap:PrivatePlacementMember 2018-01-12 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember 2018-01-12 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember us-gaap:ConvertiblePreferredStockMember 2018-01-06 2018-01-07 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember us-gaap:ConvertiblePreferredStockMember aldr:TwoPointFivePercentConvertibleSeniorNotesDueFebruaryOneTwoThousandAndTwentyFiveMember 2018-01-06 2018-01-07 0001423824 us-gaap:ConvertiblePreferredStockMember aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember 2018-01-07 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember us-gaap:ConvertiblePreferredStockMember 2019-04-01 2019-06-30 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember us-gaap:ConvertiblePreferredStockMember 2019-01-01 2019-06-30 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember us-gaap:ConvertiblePreferredStockMember 2018-04-01 2018-06-30 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember us-gaap:ConvertiblePreferredStockMember 2018-01-01 2018-06-30 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember 2018-01-07 0001423824 aldr:PreferredStockPurchaseAgreementMember aldr:RedmileGroupLLCMember us-gaap:ConvertiblePreferredStockMember 2019-06-30 0001423824 2018-01-05 0001423824 2018-01-12 aldr:Agreement aldr:Buildings 0001423824 aldr:TevaPharmaceuticalsInternationalGmbHMember aldr:SettlementAndLicensingAgreementMember 2018-01-04 2018-01-05 0001423824 aldr:SettlementAndLicensingAgreementMember aldr:TevaPharmaceuticalsInternationalGmbHMember 2018-01-05 aldr:Milestone 0001423824 srt:MinimumMember aldr:SettlementAndLicensingAgreementMember aldr:TevaPharmaceuticalsInternationalGmbHMember 2018-01-04 2018-01-05 0001423824 srt:MaximumMember aldr:SettlementAndLicensingAgreementMember aldr:TevaPharmaceuticalsInternationalGmbHMember 2018-01-04 2018-01-05 0001423824 srt:MaximumMember aldr:TerminationForBreachOfContractManufacturingAgreementMember 2019-02-28

Can I  

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

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

For the quarterly period ended June 30, 2019  

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: 001-36431

 

Alder BioPharmaceuticals, Inc.

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

90-0134860

(State or other jurisdiction

of incorporation or organization)

 

(I.R.S. Employer

Identification No.)

11804 North Creek Parkway South

Bothell, WA 98011

(Address of principal executive offices including zip code)

Registrant’s telephone number, including area code: (425) 205-2900

 

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

Title of Each Class

 

Trading Symbol(s)

 

Name of Exchange on Which Registered

Common Stock, $0.0001 par value per share

 

ALDR

 

The Nasdaq Stock Market LLC
(The Nasdaq Global 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, 2019, the registrant had 83,637,234 shares of common stock, $0.0001 par value per share, outstanding.

 

 

 


 

Alder BioPharmaceuticals, Inc.

Quarterly Report on Form 10-Q

For the Quarter Ended June 30, 2019

INDEX

 

 

Page

 

PART I. FINANCIAL INFORMATION (Unaudited)

 

 

Item 1.

 

 

Condensed Consolidated Financial Statements

3

 

 

 

Condensed Consolidated Balance Sheets

3

 

 

 

Condensed Consolidated Statements of Operations

4

 

 

 

Condensed Consolidated Statements of Comprehensive Loss

5

 

 

Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity

6

 

 

 

Condensed Consolidated Statements of Cash Flows

7

 

 

 

Notes to Condensed Consolidated Financial Statements

8

 

Item 2.

 

 

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

24

 

Item 3.

 

 

Quantitative and Qualitative Disclosures About Market Risk

35

 

Item 4.

 

 

Controls and Procedures

36

 

PART II. OTHER INFORMATION

 

 

Item 1.

 

 

Legal Proceedings

37

 

Item 1A.

 

 

Risk Factors

37

 

Item 6.

 

 

Exhibits

65

 

SIGNATURES

67

In this Quarterly Report on Form 10-Q, “we,” “our,” “us,” “Alder,” and “the Company” refer to Alder BioPharmaceuticals, Inc. and, where appropriate, its consolidated subsidiaries. “Alder,” “Alder BioPharmaceuticals” and the Alder logo are the property of Alder BioPharmaceuticals, Inc. This report contains references to our trademarks and trade names and to trademarks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this report may appear without the ® or ™ symbols, but such references are not intended to indicate, in any way, that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto. We do not intend our use or display of other companies’ trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

 

 

 

2


 

PART I. – FINANCIAL INFORMATION

 

Item 1.

Condensed Consolidated Financial Statements

Alder BioPharmaceuticals, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

 

 

 

 

 

 

 

 

 

 

June 30,

 

 

December 31,

 

 

2019

 

 

2018

 

 

(in thousands, except share and per share data)

 

Assets

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

Cash and cash equivalents

$

88,378

 

 

$

87,865

 

Short-term investments

 

320,933

 

 

 

319,504

 

Restricted cash

 

31,341

 

 

 

5,000

 

Prepaid expenses and other assets

 

11,020

 

 

 

7,440

 

Total current assets

 

451,672

 

 

 

419,809

 

Property and equipment, net

 

6,403

 

 

 

6,400

 

Right of use assets

 

4,480

 

 

 

 

Other assets

 

12

 

 

 

30

 

Total assets

$

462,567

 

 

$

426,239

 

Liabilities, convertible preferred stock and stockholders’ equity

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

Accounts payable

$

7,722

 

 

$

8,945

 

Accrued liabilities

 

41,826

 

 

 

19,217

 

Operating lease liability

 

981

 

 

 

 

Deferred rent

 

 

 

 

74

 

Total current liabilities

 

50,529

 

 

 

28,236

 

Long-term operating lease liability

 

4,061

 

 

 

 

Long-term deferred rent

 

 

 

 

510

 

2025 convertible senior notes, net

 

188,323

 

 

 

182,104

 

Derivative liability

 

2,803

 

 

 

1,658

 

Total liabilities

 

245,716

 

 

 

212,508

 

Commitments and contingencies

 

 

 

 

 

 

 

Class A-1 convertible preferred stock; $0.0001 par value; 10,000,000 shares authorized; 779,776 and 760,753 shares issued and outstanding, respectively; liquidation preference of $107,516 and $104,893, respectively

 

106,546

 

 

 

103,755

 

Stockholders’ equity

 

 

 

 

 

 

 

Common stock; $0.0001 par value; 200,000,000 shares authorized; 83,609,492 and 68,410,576 shares issued and outstanding, respectively

 

8

 

 

 

7

 

Additional paid-in capital

 

1,250,629

 

 

 

1,074,963

 

Accumulated deficit

 

(1,140,283

)

 

 

(963,938

)

Accumulated other comprehensive loss

 

(49

)

 

 

(1,056

)

Total stockholders’ equity

 

110,305

 

 

 

109,976

 

Total liabilities, convertible preferred stock and stockholders’ equity

$

462,567

 

 

$

426,239

 

 

 

 

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

3


 

Alder BioPharmaceuticals, Inc.

Condensed Consolidated Statements of Operations

(unaudited)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

June 30,

 

 

June 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

 

(in thousands, except share and per share data)

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Collaboration and license agreements

 

$

 

 

$

 

 

$

 

 

$

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

34,125

 

 

 

52,818

 

 

 

103,714

 

 

 

126,866

 

General and administrative

 

 

21,633

 

 

 

11,911

 

 

 

66,131

 

 

 

23,464

 

Total operating expenses

 

 

55,758

 

 

 

64,729

 

 

 

169,845

 

 

 

150,330

 

Loss from operations

 

 

(55,758

)

 

 

(64,729

)

 

 

(169,845

)

 

 

(150,330

)

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

2,492

 

 

 

2,533

 

 

 

4,458

 

 

 

4,176

 

Interest expense

 

 

(4,975

)

 

 

(4,688

)

 

 

(9,813

)

 

 

(7,539

)

Change in fair value of derivative liability

 

 

(170

)

 

 

(1,505

)

 

 

(1,145

)

 

 

(1,505

)

Total other income (expense), net

 

 

(2,653

)

 

 

(3,660

)

 

 

(6,500

)

 

 

(4,868

)

Net loss before equity in net loss of unconsolidated entity

 

 

(58,411

)

 

 

(68,389

)

 

 

(176,345

)

 

 

(155,198

)

Equity in net loss of unconsolidated entity

 

 

 

 

 

 

 

 

 

 

 

(222

)

Net loss

 

$

(58,411

)

 

$

(68,389

)

 

$

(176,345

)

 

$

(155,420

)

Deemed dividends on convertible preferred stock attributable to accretion of beneficial conversion feature

 

 

 

 

 

 

 

 

 

 

 

(29,460

)

Dividends on convertible preferred stock

 

 

(1,480

)

 

 

(2,302

)

 

 

(2,791

)

 

 

(3,385

)

Net loss applicable to common stockholders

 

$

(59,891

)

 

$

(70,691

)

 

$

(179,136

)

 

$

(188,265

)

Net loss per share applicable to common stockholders - basic and diluted

 

$

(0.72

)

 

$

(1.04

)

 

$

(2.29

)

 

$

(2.77

)

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

 

 

83,479,867

 

 

 

67,966,066

 

 

 

78,297,180

 

 

 

67,905,804

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

4


 

Alder BioPharmaceuticals, Inc.

Condensed Consolidated Statements of Comprehensive Loss

(unaudited)

 

 

Three Months Ended

 

 

Six Months Ended

 

 

June 30,

 

 

June 30,

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

 

(in thousands)

 

Net loss

$

(58,411

)

 

$

(68,389

)

 

$

(176,345

)

 

$

(155,420

)

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized gain (loss) on securities available-for-sale, net of tax

 

445

 

 

 

(386

)

 

 

1,007

 

 

 

(1,263

)

Total other comprehensive income (loss), net

 

445

 

 

 

(386

)

 

 

1,007

 

 

 

(1,263

)

Comprehensive loss

$

(57,966

)

 

$

(68,775

)

 

$

(175,338

)

 

$

(156,683

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

5


 

Alder BioPharmaceuticals, Inc.

 

Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity

(unaudited)

 

 

 

Class A-1 Convertible Preferred Stock

 

 

Common Stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Additional

Paid-in

Capital

 

 

Accumulated

Deficit

 

 

Accumulated

Other

Comprehensive

Income (Loss)

 

 

Total

Stockholders'

Equity

 

 

 

 

 

 

 

 

 

 

 

(in thousands, except for share data)

 

 

 

 

 

 

 

 

 

Balances at December 31, 2017

 

 

 

 

$

 

 

 

67,842,942

 

 

$

7

 

 

$

946,869

 

 

$

(667,509

)

 

$

(92

)

 

$

279,275

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(155,420

)

 

 

 

 

 

(155,420

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,263

)

 

 

(1,263

)

Issuance of Class A-1 convertible preferred stock, net of issuance costs of $2.3 million

 

 

725,268

 

 

 

97,710

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beneficial conversion feature on Class A-1 convertible preferred stock

 

 

 

 

 

(29,460

)

 

 

 

 

 

 

 

 

29,460

 

 

 

 

 

 

 

 

 

29,460

 

Deemed dividend on convertible preferred stock attributable to accretion of beneficial conversion feature

 

 

 

 

 

29,460

 

 

 

 

 

 

 

 

 

(29,460

)

 

 

 

 

 

 

 

 

(29,460

)

Paid-in-kind dividends on convertible preferred stock

 

 

16,927

 

 

 

3,385

 

 

 

 

 

 

 

 

 

(3,385

)

 

 

 

 

 

 

 

 

(3,385

)

Equity component of 2025 convertible senior notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

109,911

 

 

 

 

 

 

 

 

 

109,911

 

Equity component of deferred financing costs for 2025 convertible senior notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,763

)

 

 

 

 

 

 

 

 

(3,763

)

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13,169

 

 

 

 

 

 

 

 

 

13,169

 

Exercise of stock options

 

 

 

 

 

 

 

 

233,562

 

 

 

 

 

 

426

 

 

 

 

 

 

 

 

 

426

 

Shares issued under employee stock purchase plan

 

 

 

 

 

 

 

 

76,570

 

 

 

 

 

 

716

 

 

 

 

 

 

 

 

 

716

 

Balances at June 30, 2018

 

 

742,195

 

 

$

101,095

 

 

 

68,153,074

 

 

$

7

 

 

$

1,063,943

 

 

$

(822,929

)

 

$

(1,355

)

 

$

239,666

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balances at December 31, 2018

 

 

760,753

 

 

$

103,755

 

 

 

68,410,576

 

 

$

7

 

 

$

1,074,963

 

 

$

(963,938

)

 

$

(1,056

)

 

$

109,976

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(176,345

)

 

 

 

 

 

(176,345

)

Paid-in-kind dividends on convertible preferred stock

 

 

19,023

 

 

 

2,791

 

 

 

 

 

 

 

 

 

(2,791

)

 

 

 

 

 

 

 

 

(2,791

)

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,007

 

 

 

1,007

 

Issuance of common stock, net of offering costs

 

 

 

 

 

 

 

 

14,739,130

 

 

 

1

 

 

 

159,097

 

 

 

 

 

 

 

 

 

159,098

 

Exercise of stock options

 

 

 

 

 

 

 

 

104,427

 

 

 

 

 

 

493

 

 

 

 

 

 

 

 

 

493

 

Restricted stock units vested, net

 

 

 

 

 

 

 

 

256,711

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares issued under employee stock purchase plan

 

 

 

 

 

 

 

 

98,648

 

 

 

 

 

 

908

 

 

 

 

 

 

 

 

 

908

 

Stock-based compensation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

17,959

 

 

 

 

 

 

 

 

 

17,959

 

Balances at June 30, 2019

 

 

779,776

 

 

$

106,546

 

 

 

83,609,492

 

 

$

8

 

 

$

1,250,629

 

 

$

(1,140,283

)

 

$

(49

)

 

$

110,305

 

 

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

6


 

Alder BioPharmaceuticals, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

 

 

 

Six Months Ended

 

 

 

 

June 30,

 

 

 

 

2019

 

 

2018

 

 

 

 

(in thousands)

 

 

Operating activities

 

 

 

 

 

 

 

 

 

Net loss

 

$

(176,345

)

 

$

(155,420

)

 

Adjustments to reconcile net loss to net cash used in operating activities

 

 

 

 

 

 

 

 

 

Equity in net loss of unconsolidated entity

 

 

 

 

 

222

 

 

Depreciation and amortization

 

 

1,070

 

 

 

1,608

 

 

Stock-based compensation

 

 

17,959

 

 

 

13,169

 

 

Accretion of discount on convertible notes

 

 

6,219

 

 

 

4,544

 

 

Non-cash change in fair value of derivative liability

 

 

1,145

 

 

 

1,505

 

 

Other non-cash charges, net

 

 

(1,712

)

 

 

(1,460

)

 

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

 

Prepaid expenses and other assets

 

 

(3,562

)

 

 

3,373

 

 

Accounts payable

 

 

(1,257

)

 

 

8,026

 

 

Accrued liabilities

 

 

22,609

 

 

 

(2,083

)

 

Deferred rent

 

 

 

 

 

(10

)

 

Net cash used in operating activities

 

 

(133,874

)

 

 

(126,526

)

 

Investing activities

 

 

 

 

 

 

 

 

 

Purchases of investments

 

 

(64,022

)

 

 

(487,031

)

 

Proceeds from maturities of investments

 

 

65,290

 

 

 

193,000

 

 

Proceeds from sales of investments

 

 

 

 

 

83,184

 

 

Purchases of property and equipment

 

 

(1,039

)

 

 

(277

)

 

Net cash provided by (used in) investing activities

 

 

229

 

 

 

(211,124

)

 

Financing activities

 

 

 

 

 

 

 

 

 

Proceeds from issuance of 2025 convertible senior notes, net of offering costs

 

 

 

 

 

277,656

 

 

Proceeds from issuance of convertible preferred stock, net of offering costs

 

 

 

 

 

97,710

 

 

Proceeds from issuance of common stock, net of offering costs

 

 

159,098

 

 

 

 

 

Proceeds from exercise of stock options and employee stock purchase plan

 

 

1,401

 

 

 

1,142

 

 

Net cash provided by financing activities

 

 

160,499

 

 

 

376,508

 

 

Net increase in cash, cash equivalents and restricted cash

 

 

26,854

 

 

 

38,858

 

 

Cash, cash equivalents and restricted cash

 

 

 

 

 

 

 

 

 

Beginning of period

 

 

92,865

 

 

 

86,896

 

 

End of period

 

$

119,719

 

 

$

125,754

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental disclosures:

 

 

 

 

 

 

 

 

 

Cash paid for interest

 

$

3,594

 

 

$

 

 

Purchases of property and equipment included in accounts payable and accrued liabilities

 

$

243

 

 

$

246

 

 

 

 

 

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.

 

 

7


 

Alder BioPharmaceuticals, Inc.

Notes to Condensed Consolidated Financial Statements

 

1.

Nature of Business

 

Alder BioPharmaceuticals, Inc. (the “Company”) is a clinical-stage biopharmaceutical company that discovers, develops and seeks to commercialize therapeutic antibodies with the potential to meaningfully transform the treatment paradigm in migraine. The Company has developed a proprietary antibody platform designed to select and manufacture antibodies that have the potential to maximize efficacy as well as speed of onset and durability of therapeutic response. The Company was incorporated in Delaware on May 20, 2002 and is located in Bothell, Washington.

Financings             

On March 4, 2019, the Company completed an underwritten public offering of 13,000,000 shares of common stock, which included 1,695,652 shares issued pursuant to the underwriters’ exercise of their option to purchase additional shares. Concurrent with the public offering, the Company sold in a private placement 1,739,130 shares of common stock to the Redmile Group, LLC (a related party) and certain institutional and other accredited investors affiliated with or managed by Redmile Group, LLC. The Company received approximately $159.1 million in net proceeds from these offerings, after deducting underwriting discounts and commissions and placement agent fees of $10.2 million and offering expenses of approximately $0.2 million.

 

 

2.

Summary of Significant Accounting Policies