huma-20220331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________________________________________________________________________________________________________

FORM 10-Q

(Mark One)

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

For the quarterly period ended March 31, 2022

o 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: 001-39532

___________________________________________________________________________________________________

Humacyte, Inc.

(Exact name of registrant as specified in its charter)

___________________________________________________________________________________________________


Delaware		85-1763759
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2525 East North Carolina Highway 54
Durham,	NC	27713
(Address of principal executive offices)		(Zip code)

(919) 313-9633

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

___________________________________________________________________________________________________

Securities registered pursuant to 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

HUMA

The Nasdaq Stock Market LLC

Redeemable Warrants, each whole warrant exercisable for one share of Common Stock at an exercise price of $11.50

HUMAW

The Nasdaq Stock Market LLC

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 x No o

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 x No o

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. o

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

As of May 5, 2022, 103,004,572 shares of common stock, par value $0.0001, were issued and outstanding.

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Humacyte, Inc.

Quarterly Report on Form 10-Q

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		Page No.
	PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements	5

	Condensed Consolidated Balance Sheets (unaudited)	5

	Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited)	6

	Condensed Consolidated Statements of Changes in Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) (unaudited)	7

	Condensed Consolidated Statements of Cash Flows (unaudited)	8

	Notes to Condensed Consolidated Financial Statements (unaudited)	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	30

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	40

Item 4.	Controls and Procedures	40

	PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	41

Item 1A.	Risk Factors	41

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41

Item 3.	Defaults Upon Senior Securities	41

Item 4.	Mine Safety Disclosures	41

Item 5.	Other Information	41

Item 6.	Exhibits	42

SIGNATURES		43

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FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (“Quarterly Report”) contains forward-looking statements that involve substantial risks and uncertainties. “Forward-looking statements,” as that term is defined in the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”) are statements that are not historical facts and involve a number of risks and uncertainties. These statements include, without limitation, statements regarding the financial position, business strategy and the plans and objectives of management for future operations. These statements constitute projections, forecasts and forward-looking statements, and are not guarantees of performance. Such statements can be identified by the fact that they do not relate strictly to historical or current facts. When used therein, words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “strive,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Such statements are based on the beliefs of, as well as assumptions made by and information currently available to, our management.

Forward-looking statements may include, for example, statements about:

•our plans and ability to execute product development, process development and preclinical development efforts successfully and on our anticipated timelines;

•our plans and ability to obtain marketing approval from the U.S. Food and Drug Administration (“FDA”) and other regulatory authorities, including the European Medicines Agency (“EMA”), for our bioengineered human acellular vessels (“HAVs”) and other product candidates;

•our ability to design, initiate and successfully complete clinical trials and other studies for our product candidates and our plans and expectations regarding our ongoing or planned clinical trials, including for our ongoing V005 Phase II/III clinical trial and V007 Phase III clinical trial;

•the outcome of our ongoing discussions with the FDA concerning the design of our ongoing V005 Phase II/III clinical trial, including determination of trial size;

•our anticipated growth rate and market opportunities;

•the potential liquidity and trading of our securities;

•our ability to raise additional capital in the future;

•our ability to use our proprietary scientific technology platform to build a pipeline of additional product candidates;

•the characteristics and performance of our bioengineered human, acellular tissue-based vessels (“HAVs”);

•our plans and ability to commercialize our HAVs and other product candidates, if approved by regulatory authorities;

•the expected size of the target populations for our product candidates;

•the anticipated benefits of our HAVs relative to existing alternatives;

•our assessment of the competitive landscape;

•the degree of market acceptance of HAVs, if approved, and the availability of third-party coverage and reimbursement;

•our ability to manufacture HAVs and other product candidates in sufficient quantities to satisfy our clinical trial and commercial needs;

•our expectations regarding our strategic partnership with Fresenius Medical Care Holdings, Inc. (“Fresenius Medical Care”) to sell, market and distribute our 6 millimeter HAV for certain specified indications and in specified markets;

•the performance of other third parties on which we rely, including our third-party manufacturers, our licensors, our suppliers and the organizations conducting our clinical trials;

•our ability to obtain and maintain intellectual property protection for our product candidates as well as our ability to operate our business without infringing, misappropriating or otherwise violating the intellectual property rights of others;

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•our ability to maintain the confidentiality of our trade secrets, particularly with respect to our manufacturing process;

•our compliance with applicable laws and regulatory requirements, including FDA regulations, healthcare laws and regulations, and anti-corruption laws;

•our ability to attract, retain and motivate qualified personnel and to manage our growth effectively;

•our future financial performance and capital requirements;

•our ability to implement and maintain effective internal controls; and

•the impact of the COVID-19 pandemic on our business, including our manufacturing efforts, and our preclinical studies and clinical trials.

We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date they are made. Any forward-looking statement is based on information current as of the date of this Quarterly Report and speaks only as of the date on which such statement is made. Actual events or results may differ materially from the results, plans, intentions or expectations anticipated in these forward-looking statements as a result of a variety of factors, many of which are beyond our control. More information on factors that could cause actual results to differ materially from those anticipated is included from time to time in our reports filed with the Securities and Exchange Commission (the “SEC”), including, but not limited to, those described in the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in this Quarterly Report and our Annual Report on Form 10-K for the year ended December 31, 2021, which we filed with the SEC on March 29, 2022. We disclaim any obligation, except as specifically required by law, to publicly update or revise any such statements to reflect any change in our expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.

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PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

Humacyte, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands except for share and per share amounts)


	March 31, 2022		December 31, 2021
ASSETS
Current assets
Cash and cash equivalents	$	198,222	$	217,502
Short-term investments	8,000		8,000
Accounts receivable	233		176
Prepaid expenses and other current assets	2,840		3,662
Total current assets	209,295		229,340

Finance lease right-of-use assets, net	20,917		21,432
Operating lease right-of-use assets, net	716		727
Property and equipment, net	33,540		35,034
Total assets	$	264,468	$	286,533

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	3,037	$	2,094
Accrued expenses	5,460		6,757

Finance lease obligation, current portion	2,047		1,981
Deferred payroll tax, current portion	173		173
Operating lease obligation, current portion	46		45

Total current liabilities	10,763		11,050

Contingent earnout liability	100,402		103,660
Finance lease obligation, net of current portion	20,581		21,109
SVB loan payable	27,739		27,361
Operating lease obligation, net of current portion	670		682
Common stock warrant liabilities	423		497


Total liabilities	160,578		164,359

Commitments and contingencies (Note 11)

Stockholders’ equity
Preferred stock, $0.0001 par value; 20,000,000 shares designated as of March 31, 2022 and December 31, 2021; 0 shares issued and outstanding as of March 31, 2022 and December 31, 2021	—		—
Common stock, $0.0001 par value; 250,000,000 shares authorized as of March 31, 2022 and December 31, 2021; 103,004,572 and 103,003,646 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively.	10		10
Additional paid-in capital	538,285		536,737
Accumulated deficit	(434,405)		(414,573)
Total stockholders' equity	103,890		122,174
Total liabilities and stockholders’ equity	$	264,468	$	286,533

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

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Humacyte, Inc.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(unaudited)

(in thousands except for share and per share amounts)


	For the Three Months Ended March 31,
		2022		2021

Grant revenue		$	233	$	155

Operating expenses:
Research and development		16,314		15,137
General and administrative		5,682		4,787
Total operating expenses		21,996		19,924
Loss from operations		(21,763)		(19,769)

Other income (expense), net:
Interest income		31		1
Change in fair value of contingent earnout liability		3,258		—
Interest expense		(1,432)		(533)
Change in fair value of common stock warrant liabilities		74		—


Total other income (expense), net		1,931		(532)
Net loss and comprehensive loss		$	(19,832)	$	(20,301)

Net loss per share attributable to common stockholders, basic and diluted		$	(0.19)	$	(3.46)
Weighted-average shares outstanding used in computing net loss per share attributable to common stockholders, basic and diluted		103,004,088		5,874,700

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

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Humacyte, Inc.

Condensed Consolidated Statements of Changes in Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit)

(unaudited)

(in thousands except for share amounts)


	Redeemable Convertible Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' (Deficit) Equity
	Shares	Amount		Shares	Amount
Balance as of December 31, 2021	—	$	—	103,003,646	$	10	$	536,737	$	(414,573)	$	122,174
Proceeds from the exercise of stock options	—	—		926	—		1		—		1
Stock-based compensation	—	—		—	—		1,547		—		1,547
Net loss	—	—		—	—		—		(19,832)		(19,832)
Balance as of March 31, 2022	—	$	—	103,004,572	$	10	$	538,285	$	(434,405)	$	103,890


	Redeemable Convertible Preferred Stock			Common Stock			Additional Paid-in Capital		Accumulated Deficit		Total Stockholders' (Deficit) Equity
	Shares	Amount		Shares	Amount
Balance as of December 31, 2020	69,613,562	$	420,989	5,822,396	$	1	$	37,778	$	(388,096)	$	(350,317)
Proceeds from the exercise of stock options	—	—		116,149	—		206		—		206
Stock-based compensation	—	—		—	—		2,528		—		2,528
Issuance of warrants in conjunction with debt	—	—		—	—		2,360		—		2,360
Net loss	—	—		—	—		—		(20,301)		(20,301)
Balance as of March 31, 2021	69,613,562	$	420,989	5,938,545	$	1	$	42,872	$	(408,397)	$	(365,524)

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

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Humacyte, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

(in thousands)


	For the Three Months Ended March 31,
	2022		2021
Cash flows from operating activities
Net loss	$	(19,832)	$	(20,301)

SEC Form 10-Q filed by Humacyte Inc.