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SEC Filings

VITAE PHARMACEUTICALS, INC filed this Form S-1 on 08/12/2014
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sale of convertible preferred stock, including $40.0 million of equity sales to our strategic partners, including BI. We have also funded our operations through credit facilities, equipment lease financings, federal grants and investment income.

        For the years ended December 31, 2013 and 2012, we had net income of $1.2 million and $0.2 million, respectively. Our historical net income is not necessarily indicative of results for any future period. For the six months ended June 30, 2014 and 2013, we had a net loss of $10.0 million and $8.7 million, respectively, and at June 30, 2014, we had an accumulated deficit of $120.9 million. We have devoted substantially all of our capital resources to the research and development of our product candidates. Since our inception in 2001, we have had no revenues from product sales. We expect to incur significant expenses and operating losses for the foreseeable future as we advance our product candidates from discovery through preclinical development and clinical trials, and to eventually seek regulatory approval and pursue commercialization. Furthermore, upon the closing of this offering, we expect to incur additional costs associated with operating as a public company, including significant legal, accounting, investor relations and other expenses that we did not incur as a private company.

        We will need to obtain substantial additional funding in connection with our continuing operations, in addition to the net proceeds from this offering. As of June 30, 2014, we had cash, cash equivalents and marketable securities of approximately $18.1 million. We will seek to fund our operations through the sale of equity, debt financings or other capital sources, including potential collaborations or partnerships with other companies or other strategic transactions. We may be unable to raise additional funds or enter into such other agreements or arrangements when needed on favorable terms, or at all. If we fail to raise capital or enter into such agreements as, and when, needed, we may have to significantly delay, scale back or discontinue the development and commercialization of one or more of our product candidates.

Strategic Partnerships

11b HSD1 Inhibitors with BI

        In October 2007, we entered into a research collaboration and license agreement with BI, which we refer to as the 11b Agreement. Based upon discoveries we made using Contour, we and BI formed a worldwide strategic partnership granting BI exclusive rights to develop and commercialize novel compounds for patients with type 2 diabetes and certain related metabolic disease conditions, such as abnormal blood cholesterol and triglyceride levels, obesity and hypertension, or high blood pressure. The alliance encompasses multiple series of novel, orally available 11b HSD1 inhibitors that were discovered using Contour. We also retained the right, subject to the approval of the joint steering committee established pursuant to the 11b Agreement, to develop 11b HSD1 inhibitors for certain indications outside of the core focus of diabetes and related metabolic conditions. The collaborative research program portion of this strategic partnership began in October 2007 and expired in December 2009.

        Under the 11b Agreement, we have received an aggregate of $59.2 million in non-equity funding as of June 30, 2014, including upfront license fees, research funding and success-based milestone payments. We received an upfront license fee from BI of $15.0 million upon execution of the 11b Agreement. In addition, BI made quarterly payments of $0.8 million during the 27-month collaborative research program period, for a total of $7.2 million. The upfront fee and the research collaboration payments were recognized as revenue over the 27-month funded research program period, from October 2007 through December 2009. Also, as of June 30, 2014, we earned $37.0 million for achieving substantive development milestone payments, including a $7.0 million milestone payment from BI in May 2012 related to our most advanced 11b compound VTP-34072, and we are eligible to receive up to $278.0 million in additional milestone payments based on the achievement of pre-specified events, including up to $153.0 million in development and regulatory milestone payments and up to $125.0 million in commercialization milestone payments.

        The additional development, regulatory and commercialization milestone payments are payable upon the first occurrence of any product to meet the requirements specified in the 11b Agreement. Any