arav20230930

arav20230930_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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 September 30, 2023

☐	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: 001-36361

Aravive, Inc.

(Exact name of registrant as specified in its charter)

Delaware

26-4106690

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

River Oaks Tower

3730 Kirby Drive, Suite 1200

Houston, Texas 77098

(Address of principal executive offices) (Zip Code)

(936) 355-1910

(Registrant’s telephone number, including area code)

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, par value $0.0001 per share		ARAV		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, a 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 November 3, 2023, there were 73,562,648 outstanding shares of common stock, par value $0.0001 per share, of Aravive, Inc.

Item		Page
1.	Financial Statements (unaudited):
	a. Condensed Consolidated Balance Sheets at September 30, 2023 and December 31, 2022	3
	b. Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2023 and 2022	4
	c. Condensed Consolidated Statements of Stockholders’ (Deficit) Equity for the three and nine months ended September 30, 2023 and 2022	5
	d. Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2023 and 2022	6
	e. Notes to Condensed Consolidated Financial Statements	7
2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
3.	Quantitative and Qualitative Disclosures About Market Risk	29
4.	Controls and Procedures	29

PART II. OTHER INFORMATION
1.	Legal Proceedings	30
1A.	Risk Factors	30
6.	Exhibits	34
	Signatures	35

	*September 30,*			*December 31,*
	*2023*			*2022*
		(unaudited)
Assets
Current Assets
Cash and cash equivalents	$	8,535		$	53,689
Prepaid expenses and other current assets		1,027			4,281
Total current assets		9,562			57,970
Restricted cash		2,408			2,445
Property and equipment, net		167			270
Operating lease right-of-use assets		907			1,462
Other assets		5			6
Total assets	$	13,049		$	62,153
Liabilities and stockholders' equity
Current liabilities
Accounts payable	$	5,423		$	8,765
Accrued liabilities		2,233			6,738
Operating lease obligation, current portion		2,121			2,195
Current portion of deferred revenue		-			4,414
Total current liabilities		9,777			22,112
Deferred revenue, net of current portion		-			621
Operating lease obligation, net of current portion		306			1,882
Warrant liability		1,265			26,881
Total liabilities		11,348			51,496
Commitments and contingencies (Note 6)
Stockholders' equity
Common stock, $0.0001 par value, 250,000,000 shares authorized at September 30, 2023 and 100,000,000 shares authorized at December 31, 2022; 73,562,648 shares issued and outstanding at September 30, 2023 and 59,844,850 shares issued and outstanding at December 31, 2022		7			6
Additional paid-in capital		628,543			626,778
Accumulated deficit		(626,849	)		(616,127	)
Total stockholders' equity		1,701			10,657
Total liabilities and stockholders’ equity	$	13,049		$	62,153

	*Three Months Ended*						*Nine Months Ended*
	*September 30,*						*September 30,*
	*2023*			*2022*			*2023*			*2022*
Revenue
Collaboration revenue	$	2,756		$	4,956		$	5,520		$	7,663
Total revenue		2,756			4,956			5,520			7,663
Operating expenses
Research and development		8,730			18,668			35,435			48,985
General and administrative		2,940			2,836			9,499			9,651
Total operating expenses		11,670			21,504			44,934			58,636
Loss from operations		(8,914	)		(16,548	)		(39,414	)		(50,973	)
Other income (expense), net:
Interest income		209			147			1,028			220
Change in fair value of warrant liability		29,231			—			25,616			1,410
Other income, net		700			738			2,048			2,146
Total other income (expense), net		30,140			885			28,692			3,776
Net income (loss)	$	21,226		$	(15,663	)	$	(10,722	)	$	(47,197	)
Net income (loss) per share
Basic	$	0.28		$	(0.51	)	$	(0.14	)	$	(1.72	)
Diluted	$	0.28		$	(0.51	)	$	(0.38	)	$	(1.72	)
Weighted-average shares used to compute net income (loss) per share
Basic		75,739			30,518			75,727			27,419
Diluted		76,093			30,518			95,441			27,419

	*Three and Nine Months Ended*
	*September 30, 2023*
					*Additional*						*Total*
	*Common Stock*				*Paid-In*			*Accumulated*			*Stockholders'*
	*Shares*		*Amount*		*Capital*			*Deficit*			*(Deficit) Equity*
Balances at January 1, 2023		59,844,850	$	6	$	626,778		$	(616,127	)	$	10,657
Stock-based compensation		—		—		688			—			688
Net loss		—		—		—			(49,956	)		(49,956	)
Balances at March 31, 2023		59,844,850	$	6	$	627,466		$	(666,083	)	$	(38,611	)
Issuance of common stock under employee benefit plans		23,703		—		25			—			25
Stock-based compensation		—		—		761			—			761
Net income		—		—		—			18,008			18,008
Balances at June 30, 2023		59,868,553	$	6	$	628,252		$	(648,075	)	$	(19,817	)
Issuance of common stock upon exercise of pre-funded warrants		13,694,095		1		(1	)		—			—
Stock-based compensation		—		—		292			—			292
Net income		—		—		—			21,226			21,226
Balances at September 30, 2023		73,562,648	$	7	$	628,543		$	(626,849	)	$	1,701

	*Three and Nine Months Ended*
	*September 30, 2022*
					*Additional*					*Total*
	*Common Stock*				*Paid-In*		*Accumulated*			*Stockholders'*
	*Shares*		*Amount*		*Capital*		*Deficit*			*Equity*
Balances at January 1, 2022		21,039,594	$	2	$	582,025	$	(539,805	)	$	42,222
Issuance of common stock and common stock warrants in registered direct offering, net of issuance costs of $706		3,185,216		—		9,291		—			9,291
Issuance of common stock in at the market offering, net of issuance costs of $3		54,763		—		123		—			123
Stock-based compensation		—		—		620		—			620
Net loss		—		—		—		(13,057	)		(13,057	)
Balances at March 31, 2022		24,279,573	$	2	$	592,059	$	(552,862	)	$	39,199
Issuance of common stock upon exercise of pre-funded warrants		6,210,480		1		8,592		—			8,593
Issuance of common stock under employee benefit plans		28,216		—		26		—			26
Stock-based compensation		—		—		725		—			725
Net loss		—		—		—		(18,477	)		(18,477	)
Balances at June 30, 2022		30,518,269	$	3	$	601,402	$	(571,339	)	$	30,066
Stock-based compensation		—		—		639		—			639
Net loss		—		—		—		(15,663	)		(15,663	)
Balances at September 30, 2022		30,518,269	$	3	$	602,041	$	(587,002	)	$	15,042

	*Fair Value Measurements at*
	*September 30, 2023*
	(unaudited)
	*Total*		*Level 1*		*Level 2*		*Level 3*
Assets
Money market funds	$	7,889	$	7,889	$	—	$	—
Liabilities
Warrant liability	$	1,265	$	—	$	—	$	1,265

	*Fair Value Measurements at*
	*December 31, 2022*
	*Total*		*Level 1*		*Level 2*		*Level 3*
Assets
Money market funds	$	52,905	$	52,905	$	—	$	—
Liabilities
Warrant liability	$	26,881	$	—	$	—	$	26,881

	*October 2022 Warrants*
	*September 30, 2023*			*December 31, 2022*
Expected term (in years)		1.2			1.9
Expected volatility		147.4	%		49.9	%
Risk-free interest rate		5.28	%		4.48	%
Expected dividend yield		0.00	%		0.00	%
Fair value of common share	$	0.13		$	1.25
Exercise price	$	0.7949		$	0.7949

	*October 2022 Warrants*
Balance at December 31, 2022	$	26,881
Change in fair value		33,207
Balance at March 31, 2023		60,088
Change in fair value		(29,592	)
Balance at June 30, 2023	$	30,496
Change in fair value		(29,231	)
Balance at September 30, 2023	$	1,265

SEC Form 10-Q filed by Aravive Inc.