mlnd-20210331

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 March 31, 2021


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File No. 001-35890

_____________________________________________________________________

Millendo Therapeutics, Inc.

(Exact Name of Registrant as Specified in its Charter)

_____________________________________________________________________


Delaware						45-1472564
(State or Other Jurisdiction of Incorporation or Organization)						(I.R.S. Employer Identification No.)

110 Miller Avenue, Suite 100 Ann Arbor, Michigan						48104
(Address of Principal Executive Offices)						(Zip Code)

Registrant’s telephone number, including area code: (734) 845-9000

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

_____________________________________________________________________

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, $0.001 par value	MLND	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, 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 Act). Yes ☐ No ☒

The number of shares of Registrant’s Common Stock, $0.001 par value per share, outstanding as of May 5, 2021 was 19,043,034.


		Page
	SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS	3

	PART I — FINANCIAL INFORMATION	4

Item 1.	Financial Statements (unaudited):	4
	Consolidated Balance Sheets as of March 31, 20 2 1 and December 31, 20 20	4
	Consolidated Statements of Operations and Comprehensive Loss for the Three Months Ended March 3 1 , 202 1 and 20 20	5
	Consolidated Statements of Stockholders’ Equity (Deficit) for the Three Months Ended March 31 , 202 1 and 20 20	6
	Consolidated Statements of Cash Flows for the Three Months Ended M arch 3 1 , 202 1 and 20 20	7
	Notes to Unaudited Interim Consolidated Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	26

	PART II — OTHER INFORMATION	28

Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
Item 3.	Defaults Upon Senior Securities	29
Item 4.	Mine Safety Disclosures	29
Item 5.	Other Information	29
Item 6.	Exhibits	29

Signatures		32


	(Unaudited)
	March 31, 2021		December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	26,802	$	38,174
Short-term restricted cash	45		484
Marketable securities	439		—
Prepaid expenses and other current assets	1,808		1,929
Refundable tax credit	300		314
Total current assets	29,394		40,901

Operating lease right-of-use assets	2,014		2,157
Other assets	299		351
Total assets	$	31,707	$	43,409
Liabilities and stockholders’ equity
Current liabilities:
Current portion of debt	$	235	$	239
Accounts payable	811		1,486
Accrued expenses	2,809		5,525
Operating lease liabilities — current	742		737
Total current liabilities	4,597		7,987
Debt, net of current portion	—		61
Operating lease liabilities	1,482		1,635

Total liabilities	6,079		9,683
Commitments and contingencies (Note 6)
Stockholders’ equity:
Preferred stock, $0.001 par value: 5,000,000 shares authorized; no shares issued and outstanding	—		—
Common stock, $0.001 par value: 100,000,000 shares authorized; 19,043,034 and 18,999,701 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively	19		19
Additional paid-in capital	278,113		277,647
Accumulated deficit	(253,449)		(245,060)
Accumulated other comprehensive income	277		452
Total stockholders’ equity attributable to Millendo Therapeutics, Inc.	24,960		33,058
Equity attributable to noncontrolling interests	668		668
Total stockholders’ equity	25,628		33,726
Total liabilities and stockholders’ equity	$	31,707	$	43,409


	Three Months Ended March 31,
	2021		2020
Operating expenses:
Research and development	$	2,152	$	7,540
General and administrative	6,410		4,595
Loss from operations	8,562		12,135
Other expenses (income):
Interest expense (income), net	$	1	$	(162)
Other (gain) / loss	(174)		25
Net loss	$	(8,389)	$	(11,998)


Net loss per share of common stock, basic and diluted	$	(0.44)	$	(0.65)
Weighted-average shares of common stock outstanding, basic and diluted	19,023,293		18,448,507
Other comprehensive income (loss):
Foreign currency translation adjustment	$	(175)	$	(42)
Comprehensive loss	$	(8,564)	$	(12,040)


	Three Months Ended March 31, 2021
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Total Stockholders’ Equity (Deficit) attributable to Millendo Therapeutics, Inc.		Total Equity Attributable to Noncontrolling Interests		Total Stockholders’ Equity (Deficit)
	Shares	Amount
Balance at January 1, 2021	18,999,701	$	19	$	277,647	$	(245,060)	$	452	$	33,058	$	668	$	33,726

Exercise of stock options	43,333	—		86		—		—		86		—		86

Stock-based compensation expense	—	—		380		—		—		380		—		380
Foreign currency translation adjustment	—	—		—		—		(175)		(175)		—		(175)
Net loss	—	—		—		(8,389)		—		(8,389)		—		(8,389)
Balance at March 31, 2021	19,043,034	$	19	$	278,113	$	(253,449)	$	277	$	24,960	$	668	$	25,628


	Three Months Ended March 31, 2020
	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Total Stockholders’ Equity (Deficit) attributable to Millendo Therapeutics, Inc.		Total Equity Attributable to Noncontrolling Interests		Total Stockholders’ Equity (Deficit)
	Shares	Amount
Balance at January 1, 2020	18,266,545	$	18	$	267,018	$	(208,654)	$	165	$	58,547	$	1,324	$	59,871
Issuance of common stock, net of issuance costs	719,400	1		5,649		—		—		5,650		—		5,650

Exercise/forfeiture of BSPCE warrants	12,307	—		593		—		—		593		(515)		78
Stock-based compensation expense	—	—		1,080		—		—		1,080		—		1,080
Foreign currency translation adjustment	—	—		—		—		(42)		(42)		—		(42)
Net loss	—	—		—		(11,998)		—		(11,998)		—		(11,998)
Balance at March 31, 2020	18,998,252	$	19	$	274,340	$	(220,652)	$	123	$	53,830	$	809	$	54,639


	March 31,
	2021	2020
Stock options	3,520,358	3,340,732

Common stock warrants	17,125	17,125

BSA and BSPCE warrants	48,265	58,415
	3,585,748	3,416,272


	March 31, 2021
	(Level 1)		(Level 2)		(Level 3)
Assets
Money market funds (included in cash and cash equivalents)	$	24,637	$	—	$	—
Certificate of deposit	$	439	$	—	$	—


	December 31, 2020
	(Level 1)		(Level 2)		(Level 3)
Assets
Money market funds (included in cash and cash equivalents)	$	33,636	$	—	$	—


	March 31, 2021		December 31, 2020
Compensation and related benefits	$	781	$	1,978
Professional fees	1,009		719
Preclinical and clinical costs	131		1,002

Insurance premiums	775		1,476
Other	113		350
Total	$	2,809	$	5,525


2021 (excluding the three months ended March 31, 2021)	$	573
2022	783
2023	806
2024	302
2025	—
Thereafter	—
Total	$	2,464
Present Value Adjustment	(240)
Lease liability at March 31, 2021	$	2,224


	Shares	Weighted average exercise price per share		Weighted-average remaining contractual life (years)
Outstanding at January 1, 2021	3,749,102	$	11.60	7.9
Granted	534,000	2.07
Exercised	(43,333)	2.00
Forfeited	(719,411)	6.69
Outstanding at March 31, 2021	3,520,358	$	11.28	6.7
Vested and exercisable at March 31, 2021	2,035,439	$	15.49	4.9
Vested and expected to vest at March 31, 2021	3,520,358	$	11.28	6.7


	Three Months Ended March 31, 2021	Three Months Ended March 31, 2020
Expected term (in years)	6.07	6.08
Expected volatility	75%	78%
Risk-free interest rate	0.95%	1.36%
Expected dividend yield	0%	0%


	Three Months Ended March 31,
	2021		2020
	(in thousands)
Net cash used in operating activities	$	(11,835)	$	(10,161)
Net cash provided by (used in) investing activities	8		(26)
Net cash provided by financing activities	22		5,589
Effect of foreign currency exchange rate changes on cash	(6)		(37)
Net decrease in cash, cash equivalents and restricted cash	$	(11,811)	$	(4,635)


	MILLENDO THERAPEUTICS, INC.

	By:	/s/ Louis Arcudi III
		Louis Arcudi III President and Chief Executive Officer (Principal Executive Officer)

	By:	/s/ Jennifer Minai-Azary
		Jennifer Minai-Azary Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer
Date: May 13, 2021


Exhibit Number						Description
2.1						Agreement and Plan of Merger, dated as of March 29, 2021, by and among Millendo Therapeutics, Inc., Mars Merger Corp. and Tempest Therapeutics, Inc. (incorporated by reference from Exhibit 2.1 to the Current Report on Form 8-K filed with the Securities and Exchange Commission on March 29, 2021, File No. 001-35890)

3.1						Restated Certificate of Incorporation of the Registrant, as amended (incorporated by reference from Exhibit 3.1 to the Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 15, 2019 File No. 001-35890)

3.2						Third Amended and Restated Bylaws, as Amended, of the Registrant (incorporated by reference from Exhibit 3.1 to the Current Report on Form 8-K filed with the Securities and Exchange Commission on August 9, 2018 File No. 001-35890)

10.1^						Executive Chair Agreement, by and between Millendo Therapeutics US, Inc. and Julia C. Owens, Ph.D., dated January 27, 2021 (incorporated by reference from Exhibit 10.29 to the Annual Report on Form 10-K, filed on March 29, 2021, File No. 001-35890).

10.2^						Separation from Employment, by and between Millendo Therapeutics US, Inc. and Julia C. Owens, Ph.D., dated January 27, 2021 (incorporated by reference from Exhibit 10.30 to the Annual Report on Form 10-K, filed on March 29, 2021, File No. 001-35890).

10.3^						Amended and Restated Employment Agreement between Louis Arcudi III and Millendo Therapeutics US, Inc., dated as of January 27, 2021 (incorporated by reference from Exhibit 10.31 to the Annual Report on Form 10-K, filed on March 29, 2021, File No. 001-35890).

10.4^						Amended and Restated Employment Agreement between Jennifer Minai-Azary and Millendo Therapeutics US, Inc., dated of January 27, 2021 (incorporated by reference from Exhibit 10.32 to the Annual Report on Form 10-K, filed on March 29, 2021, File No. 001-35890).

31.1*						Certification of Chief Executive Officer (Principal Executive Officer) pursuant to Section 302 of Sarbanes-Oxley Act of 2002

31.2*						Certification of Chief Financial Officer (Principal Financial Officer) pursuant to Section 302 of Sarbanes-Oxley Act of 2002

32.1+						Certification of Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer) pursuant to Section 906 of Sarbanes-Oxley Act of 2002

101.INS						Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

101.SCH						Inline XBRL Taxonomy Extension Schema Document

101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document

104						Cover Page Interactive Data File - the cover page interactive data is embedded within the Inline XBRL document or included within the Exhibit 101 attachments.

SEC Form 10-Q filed by Millendo Therapeutics, Inc.