10-Q
false--12-310001824893Q3Surrozen, Inc./DE0001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2022-04-012022-06-300001824893us-gaap:AdditionalPaidInCapitalMember2022-04-012022-06-300001824893us-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srzn:CollaborationAndLicenseAgreementWithBiMember2022-10-012022-10-310001824893srzn:LincolnParkMember2022-02-012022-02-280001824893srzn:CorporateBondMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-3100018248932023-06-300001824893srzn:UCSFLicenseAndOptionAgreementsMember2022-01-012022-09-300001824893us-gaap:RetainedEarningsMember2023-09-300001824893us-gaap:FairValueInputsLevel2Membersrzn:GovernmentBondsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srzn:GovernmentBondsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:AdditionalPaidInCapitalMember2023-09-300001824893us-gaap:StockOptionMember2023-07-012023-09-300001824893srzn:PublicWarrantsMember2022-12-310001824893us-gaap:CommonStockMember2022-07-012022-09-300001824893srzn:ClosingSalePriceBelow1000PerShareMembersrzn:LincolnParkMember2022-02-280001824893srzn:PublicWarrantsMember2023-01-012023-09-300001824893us-gaap:RetainedEarningsMember2022-09-300001824893us-gaap:FairValueInputsLevel2Memberus-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srzn:RestrictedStockAwardRSAMember2022-01-012022-09-300001824893us-gaap:CashAndCashEquivalentsMember2023-09-300001824893srzn:PublicWarrantsMembersrzn:CommonStock1Member2023-01-012023-09-300001824893us-gaap:RetainedEarningsMember2021-12-310001824893us-gaap:RetainedEarningsMember2023-01-012023-03-310001824893us-gaap:FairValueInputsLevel1Membersrzn:PublicWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893srzn:PublicWarrantsMembersrzn:CommonStock1Member2023-09-300001824893srzn:CorporateBondMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-3100018248932021-12-310001824893us-gaap:CommonStockMember2022-04-012022-06-300001824893us-gaap:CommonStockMember2021-12-310001824893srzn:PIPEWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2022-06-300001824893us-gaap:FairValueInputsLevel3Membersrzn:PIPEWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:AdditionalPaidInCapitalMember2022-12-310001824893us-gaap:AdditionalPaidInCapitalMember2022-09-300001824893us-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srzn:EmployeeStockPurchasePlanMember2023-09-300001824893us-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2022-09-300001824893us-gaap:FairValueInputsLevel1Membersrzn:GovernmentBondsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:CommonStockMember2023-09-300001824893srzn:EmployeeSeveranceAndOtherBenefitsMember2022-12-310001824893srzn:ClosingSalePriceBelow1200PerShareMembersrt:MaximumMember2022-02-280001824893us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:StockOptionMember2023-01-012023-09-300001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2022-01-012022-03-310001824893srzn:TwoThousandTwentyOneStockPlanMember2023-09-300001824893us-gaap:RestrictedStockUnitsRSUMember2022-12-310001824893us-gaap:FairValueInputsLevel2Memberus-gaap:CommercialPaperMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:CommonStockMember2023-07-012023-09-300001824893srzn:CorporateBondMember2022-12-310001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2023-09-300001824893srt:MaximumMembersrzn:LincolnParkMember2022-02-012022-02-280001824893srzn:EmployeeStockPurchasePlanMember2023-01-012023-09-3000018248932023-01-012023-09-300001824893srzn:UnvestedCommonStockSharesSubjectToRepurchaseMember2022-01-012022-09-300001824893srt:MaximumMembersrzn:StanfordLicenseAgreementsMembersrzn:StanfordMember2016-03-012016-03-310001824893us-gaap:GeneralAndAdministrativeExpenseMember2022-01-012022-09-300001824893srzn:PIPEWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893srzn:RestrictedStockAwardRSAMember2023-01-012023-09-300001824893srzn:UnvestedCommonStockSharesSubjectToRepurchaseMember2023-01-012023-09-300001824893us-gaap:FairValueInputsLevel3Membersrzn:GovernmentBondsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:CommercialPaperMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:StockOptionMember2022-01-012022-09-300001824893us-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:RetainedEarningsMember2022-04-012022-06-300001824893us-gaap:RetainedEarningsMember2023-04-012023-06-300001824893srzn:EmployeeSeveranceAndOtherBenefitsMember2023-09-300001824893us-gaap:MeasurementInputExpectedDividendRateMembersrzn:PIPEWarrantsMember2023-09-300001824893srzn:PublicWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-3000018248932022-03-310001824893us-gaap:GeneralAndAdministrativeExpenseMember2022-07-012022-09-300001824893us-gaap:FairValueInputsLevel1Membersrzn:PIPEWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2022-07-012022-09-300001824893srzn:WarrantToPurchaseCommonStockMember2022-01-012022-09-300001824893us-gaap:CommonStockMember2023-06-300001824893srzn:RestrictedStockAwardRSAMember2023-09-3000018248932022-01-012022-12-310001824893us-gaap:GeneralAndAdministrativeExpenseMember2023-07-012023-09-3000018248932022-09-300001824893srzn:GovernmentBondsMember2023-09-300001824893us-gaap:CommercialPaperMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:AdditionalPaidInCapitalMember2023-01-012023-03-310001824893us-gaap:CommonStockMember2022-09-300001824893us-gaap:CommonStockMember2023-03-310001824893us-gaap:FairValueInputsLevel2Membersrzn:PublicWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:AdditionalPaidInCapitalMember2023-06-3000018248932022-01-012022-09-300001824893us-gaap:RetainedEarningsMember2023-03-310001824893us-gaap:RetainedEarningsMember2023-07-012023-09-300001824893srzn:StanfordLicenseAgreementsMembersrzn:StanfordMember2023-01-012023-09-300001824893stpr:CAsrzn:EightYearsMember2016-08-310001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2021-12-310001824893us-gaap:RestrictedStockUnitsRSUMember2023-01-012023-09-300001824893us-gaap:CommercialPaperMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:FairValueInputsLevel1Membersrzn:GovernmentBondsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srt:MaximumMember2022-02-012022-02-280001824893us-gaap:RestrictedStockUnitsRSUMember2023-01-012023-09-300001824893us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893srzn:LincolnParkMember2022-02-280001824893us-gaap:CommercialPaperMember2023-09-300001824893srzn:PublicWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:EmployeeStockOptionMember2022-01-012022-09-300001824893srzn:GovernmentBondsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:ResearchAndDevelopmentExpenseMember2022-01-012022-09-300001824893srzn:PublicWarrantsMember2023-09-300001824893srzn:PublicWarrantsMembersrzn:CommonStock2Member2023-01-012023-09-300001824893us-gaap:AdditionalPaidInCapitalMember2023-04-012023-06-300001824893srzn:PublicWarrantsMembersrzn:CommonStock2Member2023-09-300001824893us-gaap:CommonStockMember2022-12-310001824893srzn:EmployeeSeveranceAndOtherBenefitsMember2023-01-012023-03-310001824893us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMember2022-12-3100018248932023-07-012023-09-300001824893srzn:WarrantToPurchaseCommonStockMember2023-01-012023-09-3000018248932023-09-300001824893us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srzn:RestrictedStockAwardRSAMember2022-12-310001824893us-gaap:FairValueInputsLevel3Membersrzn:PIPEWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:RetainedEarningsMember2022-06-3000018248932023-01-012023-03-310001824893us-gaap:FairValueInputsLevel2Membersrzn:PIPEWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:CommonStockMember2022-06-300001824893srzn:LincolnParkMember2023-01-012023-09-300001824893srt:MinimumMembersrzn:LincolnParkMember2022-02-012022-02-280001824893srzn:RestrictedStockAwardRSAMember2023-01-012023-09-300001824893us-gaap:FairValueInputsLevel2Membersrzn:GovernmentBondsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:FairValueInputsLevel2Membersrzn:PIPEWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-3100018248932023-03-310001824893us-gaap:EmployeeStockMembersrt:MaximumMembersrzn:TwoThousandTwentyOneStockPlanMember2023-01-012023-09-300001824893srzn:RestrictedStockAwardRSAMember2022-01-012022-09-300001824893us-gaap:CommonStockMember2022-01-012022-03-310001824893srt:MaximumMembersrzn:ClosingSalePriceBelow1000PerShareMember2022-02-280001824893us-gaap:FairValueInputsLevel1Membersrzn:PublicWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-09-3000018248932022-07-012022-09-300001824893us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001824893srzn:GovernmentBondsMember2022-12-310001824893us-gaap:AdditionalPaidInCapitalMember2022-06-300001824893us-gaap:GeneralAndAdministrativeExpenseMember2023-01-012023-09-300001824893srzn:UCSFLicenseAndOptionAgreementsMember2023-01-012023-09-300001824893us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:RetainedEarningsMember2023-06-300001824893srt:MinimumMembersrzn:PIPEWarrantsMember2023-01-012023-09-3000018248932023-04-012023-06-3000018248932022-12-310001824893us-gaap:AdditionalPaidInCapitalMember2023-03-310001824893us-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893srzn:PIPEWarrantsMember2023-09-300001824893us-gaap:CommercialPaperMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:ResearchAndDevelopmentExpenseMember2023-01-012023-09-300001824893us-gaap:FairValueInputsLevel2Membersrzn:CorporateBondMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srzn:StanfordLicenseAgreementsMember2022-01-012022-09-300001824893us-gaap:CommonStockMember2023-01-012023-03-310001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2022-03-310001824893srzn:EmployeeSeveranceAndOtherBenefitsMember2023-04-012023-06-300001824893us-gaap:RetainedEarningsMember2022-12-310001824893us-gaap:CommercialPaperMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2022-12-310001824893srzn:PIPEWarrantsMember2023-01-012023-09-300001824893srzn:CorporateBondMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srt:MaximumMembersrzn:PIPEWarrantsMember2023-01-012023-09-300001824893us-gaap:FairValueInputsLevel1Membersrzn:PIPEWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-3100018248932022-01-012022-03-310001824893us-gaap:AdditionalPaidInCapitalMember2021-12-310001824893us-gaap:FairValueInputsLevel3Memberus-gaap:USGovernmentCorporationsAndAgenciesSecuritiesMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srzn:PublicWarrantsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893srzn:DistributedBioSubscriptionAgreementMember2016-09-012016-09-300001824893us-gaap:FairValueInputsLevel2Membersrzn:PublicWarrantsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:CommonStockMember2023-04-012023-06-300001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2023-07-012023-09-3000018248932022-06-300001824893us-gaap:AccountsReceivableMembersrzn:CollaborationAndLicenseAgreementWithBiMember2022-01-012022-12-310001824893us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:CommonStockMember2023-01-012023-09-300001824893us-gaap:StockOptionMember2022-07-012022-09-300001824893srzn:ShortTermMarketableSecuritiesMember2023-09-300001824893us-gaap:RetainedEarningsMember2022-01-012022-03-310001824893us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893srzn:EmployeeSeveranceAndOtherBenefitsMember2023-06-3000018248932023-11-060001824893srzn:EmployeeSeveranceAndOtherBenefitsMember2023-07-012023-09-300001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2023-04-012023-06-300001824893us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srzn:ClosingSalePriceBelow1200PerShareMember2022-02-280001824893us-gaap:FairValueInputsLevel3Membersrzn:GovernmentBondsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893srzn:DistributedBioSubscriptionAgreementMember2023-01-012023-09-300001824893srzn:DistributedBioSubscriptionAgreementMember2022-01-012022-09-300001824893us-gaap:AccountsReceivableMembersrzn:CollaborationAndLicenseAgreementWithBiMember2023-01-012023-09-300001824893us-gaap:AdditionalPaidInCapitalMember2023-07-012023-09-300001824893us-gaap:AdditionalPaidInCapitalMember2022-07-012022-09-300001824893stpr:CAsrzn:EightYearsMember2023-09-300001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2023-03-310001824893us-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893srzn:GuggenheimSecuritiesLlcMember2022-12-310001824893us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2023-06-300001824893us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893srzn:EmployeeSeveranceAndOtherBenefitsMember2023-03-310001824893srzn:LincolnParkMember2023-09-300001824893us-gaap:ResearchAndDevelopmentExpenseMember2023-07-012023-09-300001824893us-gaap:RestrictedStockUnitsRSUMember2023-09-300001824893us-gaap:CommercialPaperMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:AccumulatedOtherComprehensiveIncomeLossDerivativeQualifyingAsHedgeExcludedComponentIncludingPortionAttributableToNoncontrollingInterestMember2023-01-012023-03-3100018248932022-04-012022-06-300001824893us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:FairValueInputsLevel2Memberus-gaap:CommercialPaperMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001824893us-gaap:CommonStockMember2022-03-310001824893us-gaap:ResearchAndDevelopmentExpenseMember2022-07-012022-09-300001824893srzn:PublicWarrantsMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:AdditionalPaidInCapitalMember2022-03-310001824893srzn:PIPEWarrantsMember2022-12-310001824893srzn:RedeemableWarrantMember2023-01-012023-09-300001824893us-gaap:CommercialPaperMember2022-12-310001824893srzn:StanfordLicenseAgreementsMember2023-01-012023-09-300001824893srzn:DistributedBioSubscriptionAgreementMember2023-07-012023-09-300001824893us-gaap:EmployeeStockMembersrzn:TwoThousandTwentyOneStockPlanMember2023-01-012023-09-300001824893us-gaap:EmployeeStockOptionMember2023-01-012023-09-300001824893srzn:StanfordLicenseAgreementsMembersrzn:StanfordMember2018-06-012018-06-300001824893srzn:StanfordLicenseAgreementsMembersrzn:StanfordMember2016-03-012016-03-310001824893us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001824893us-gaap:RetainedEarningsMember2022-03-310001824893srzn:DistributedBioSubscriptionAgreementMember2022-07-012022-09-300001824893us-gaap:RetainedEarningsMember2022-07-012022-09-30xbrli:pureutr:sqftxbrli:sharesiso4217:USDxbrli:sharessrzn:Investmentsiso4217:USD

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

(Mark One)

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

For the quarterly period ended September 30, 2023

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: 001-39635

 

Surrozen, Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Delaware

30-1374889

( State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

171 Oyster Point Blvd, Suite 400, South San Francisco, California

94080

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code: (650) 489-9000

 

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, $0.0001 par value per share

 

SRZN

 

The Nasdaq Capital Market

Redeemable warrants, each whole warrant exercisable for one share of Common Stock

 

SRZNW

 

The Nasdaq Capital 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 November 6, 2023, there were 30,575,047 shares of common stock, par value $0.0001 per share, issued and outstanding.

 

 


 

Table of Contents

 

Page

PART I.

FINANCIAL INFORMATION

Item 1.

Financial Statements

1

Unaudited Condensed Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022

1

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended September 30, 2023 and 2022

2

Unaudited Condensed Consolidated Statements of Stockholders’ Equity for the three and nine months ended September 30, 2023 and 2022

3

Unaudited Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2023 and 2022

5

Notes to Unaudited Condensed Consolidated Financial Statements

6

Item 2.

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

17

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

24

Item 4.

Controls and Procedures

24

 

 

 

PART II.

OTHER INFORMATION

Item 1.

Legal Proceedings

26

Item 1A.

Risk Factors

26

Item 2.

Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities

71

Item 3.

Defaults Upon Senior Securities

71

Item 4.

Mine Safety Disclosures

71

Item 5.

Other Information

71

Item 6.

Exhibits

72

Signatures

73

 

 

 

i


 

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

Some of the statements contained in this Quarterly Report on Form 10-Q, or this Report, constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. These forward-looking statements include statements about future financial and operating results of Surrozen; statements about the plans, strategies and objectives of management for future operations of Surrozen; and statements regarding future performance. In some cases, you can identify these forward-looking statements by the use of terminology such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words or phrases.

 

These statements are based upon information available to us as of the date of this Report, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and such statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. Except to the extent required by applicable law, we are under no obligation (and expressly disclaim any such obligation) to update or revise our forward-looking statements whether as a result of new information, future events, or otherwise.
 

There are no guarantees that the transactions and events described will happen as described (or that they will happen at all). The forward-looking statements contained in this Report are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause our actual results to differ significantly from those expressed in any forward-looking statement.

 

Unless the context otherwise requires, references in this Quarterly Report on Form 10-Q to the “company,” “Surrozen,” “we,” “us” and “our” refer to Surrozen, Inc.

 

ii


 

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

SURROZEN, INC.

Condensed Consolidated Balance Sheets

(In thousands, except per share amounts)

 

 

 

September 30,

 

 

December 31,

 

 

 

2023

 

 

2022

 

 

 

(Unaudited)

 

 

 

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

33,975

 

 

$

24,690

 

Accounts receivable

 

 

1,978

 

 

 

1,978

 

Short-term marketable securities

 

 

9,457

 

 

 

51,148

 

Prepaid expenses and other current assets

 

 

2,947

 

 

 

3,489

 

Total current assets

 

 

48,357

 

 

 

81,305

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

2,483

 

 

 

3,630

 

Operating lease right-of-use assets

 

 

2,331

 

 

 

3,268

 

Restricted cash

 

 

426

 

 

 

405

 

Other assets

 

 

376

 

 

 

827

 

Total assets

 

$

53,973

 

 

$

89,435

 

 

 

 

 

 

 

 

Liabilities and stockholders’ equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

287

 

 

$

658

 

Accrued and other liabilities

 

 

3,953

 

 

 

6,848

 

Lease liabilities, current portion

 

 

2,432

 

 

 

2,226

 

Total current liabilities

 

 

6,672

 

 

 

9,732

 

 

 

 

 

 

 

Lease liabilities, noncurrent portion

 

 

1,527

 

 

 

3,376

 

Warrant liabilities

 

 

243

 

 

 

326

 

Total liabilities

 

 

8,442

 

 

 

13,434

 

 

 

 

 

 

 

 

Commitments and contingencies (Note 8)

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Preferred stock, $0.0001 par value, 10,000 shares authorized; no shares
   issued and outstanding as of September 30, 2023 and December 31, 2022

 

 

 

 

 

 

Common stock, $0.0001 par value, 500,000 shares authorized as of
   September 30, 2023 and December 31, 2022;
30,575 and 30,088 shares issued and
   outstanding as of September 30, 2023 and December 31, 2022, respectively

 

 

3

 

 

 

3

 

Additional paid-in-capital

 

 

258,309

 

 

 

254,892

 

Accumulated other comprehensive income (loss)

 

 

1

 

 

 

(241

)

Accumulated deficit

 

 

(212,782

)

 

 

(178,653

)

Total stockholders’ equity

 

 

45,531

 

 

 

76,001

 

Total liabilities and stockholders’ equity

 

$

53,973

 

 

$

89,435

 

 

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

 

 

1


 

SURROZEN, INC.

Condensed Consolidated Statements of Operations and Comprehensive Loss

(Unaudited)

(In thousands, except per share amounts)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

$

6,112

 

 

$

8,624

 

 

$

21,135

 

 

$

27,576

 

General and administrative

 

 

3,572

 

 

 

4,981

 

 

 

12,209

 

 

 

14,594

 

Restructuring

 

 

1,505

 

 

 

 

 

 

2,712

 

 

 

 

Total operating expenses

 

 

11,189

 

 

 

13,605

 

 

 

36,056

 

 

 

42,170

 

Loss from operations

 

 

(11,189

)

 

 

(13,605

)

 

 

(36,056

)

 

 

(42,170

)

Interest income

 

 

661

 

 

 

198

 

 

 

1,831

 

 

 

307

 

Other income, net

 

 

83

 

 

 

50

 

 

 

96

 

 

 

6,634

 

Net loss

 

 

(10,445

)

 

 

(13,357

)

 

 

(34,129

)

 

 

(35,229

)

Unrealized gain (loss) on marketable securities, net of tax

 

 

(4

)

 

 

52

 

 

 

242

 

 

 

(305

)

Comprehensive loss

 

$

(10,449

)

 

$

(13,305

)

 

$

(33,887

)

 

$

(35,534

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share attributable to common
   stockholders, basic and diluted

 

$

(0.34

)

 

$

(0.38

)

 

$

(1.13

)

 

$

(1.01

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average shares used in computing net
   loss per share attributable to common
   stockholders, basic and diluted

 

 

30,497

 

 

 

34,968

 

 

 

30,182

 

 

 

34,926

 

 

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

 

 

2


 

SURROZEN, INC.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

Additional

 

 

Accumulated
other

 

 

 

 

 

Total

 

 

 

Common stock

 

 

paid-in

 

 

comprehensive

 

 

Accumulated

 

 

stockholders’

 

 

 

Shares

 

 

Amount

 

 

capital

 

 

income (loss)

 

 

deficit

 

 

equity

 

Balance at December 31, 2022

 

 

30,088

 

 

$

3

 

 

$

254,892

 

 

$

(241

)

 

$

(178,653

)

 

$

76,001

 

Repurchase of early exercised stock options

 

 

(9

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vesting of early exercised stock options

 

 

 

 

 

 

 

 

13

 

 

 

 

 

 

 

 

 

13

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

1,129

 

 

 

 

 

 

 

 

 

1,129

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

191

 

 

 

 

 

 

191

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(14,297

)

 

 

(14,297

)

Balance at March 31, 2023

 

 

30,079

 

 

 

3

 

 

 

256,034

 

 

 

(50

)

 

 

(192,950

)

 

 

63,037

 

Issuance of common stock under employee stock purchase plan

 

 

492

 

 

 

 

 

 

187

 

 

 

 

 

 

 

 

 

187

 

Vesting of early exercised stock options

 

 

 

 

 

 

 

 

8

 

 

 

 

 

 

 

 

 

8

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

1,158

 

 

 

 

 

 

 

 

 

1,158

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

55

 

 

 

 

 

 

55

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(9,387

)

 

 

(9,387

)

Balance at June 30, 2023

 

 

30,571

 

 

 

3

 

 

 

257,387

 

 

 

5

 

 

 

(202,337

)

 

 

55,058

 

Issuance of common stock upon option exercises

 

 

6

 

 

 

 

 

 

3

 

 

 

 

 

 

 

 

 

3

 

Repurchase of early exercised stock options

 

 

(2

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vesting of early exercised stock options

 

 

 

 

 

 

 

 

6

 

 

 

 

 

 

 

 

 

6

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

913

 

 

 

 

 

 

 

 

 

913

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

(4

)

 

 

 

 

 

(4

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(10,445

)

 

 

(10,445

)

Balance at September 30, 2023

 

 

30,575

 

 

$

3

 

 

$

258,309

 

 

$

1

 

 

$

(212,782

)

 

$

45,531

 

 

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

 

 

 

 

 

 

3


 

SURROZEN, INC.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

Additional

 

 

Accumulated
other

 

 

 

 

 

Total

 

 

 

Common stock

 

 

paid-in

 

 

comprehensive

 

 

Accumulated

 

 

stockholders’

 

 

 

Shares

 

 

Amount

 

 

capital

 

 

loss

 

 

deficit

 

 

equity

 

Balance at December 31, 2021

 

 

35,034

 

 

$

4

 

 

$

252,464

 

 

$

(119

)

 

$

(142,649

)

 

$

109,700

 

Issuance of common stock under Equity Purchase Agreement

 

 

100

 

 

 

 

 

 

273

 

 

 

 

 

 

 

 

 

273

 

Repurchase of early exercised stock options

 

 

(8

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vesting of early exercised stock options

 

 

 

 

 

 

 

 

30

 

 

 

 

 

 

 

 

 

30

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

916

 

 

 

 

 

 

 

 

 

916

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

(310

)

 

 

 

 

 

(310

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(7,947

)

 

 

(7,947

)

Balance at March 31, 2022

 

 

35,126

 

 

 

4

 

 

 

253,683

 

 

 

(429

)

 

 

(150,596

)

 

 

102,662

 

Repurchase of early exercised stock options

 

 

(2

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vesting of early exercised stock options

 

 

 

 

 

 

 

 

27

 

 

 

 

 

 

 

 

 

27

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

979

 

 

 

 

 

 

 

 

 

979

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

(47

)

 

 

 

 

 

(47

)

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(13,925

)

 

 

(13,925

)

Balance at June 30, 2022

 

 

35,124

 

 

 

4

 

 

 

254,689

 

 

 

(476

)

 

 

(164,521

)

 

 

89,696

 

Repurchase of early exercised stock options

 

 

(1

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vesting of early exercised stock options

 

 

 

 

 

 

 

 

23

 

 

 

 

 

 

 

 

 

23

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

1,077

 

 

 

 

 

 

 

 

 

1,077

 

Other comprehensive loss

 

 

 

 

 

 

 

 

 

 

 

52

 

 

 

 

 

 

52

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(13,357

)

 

 

(13,357

)

Balance at September 30, 2022

 

 

35,123

 

 

$

4

 

 

$

255,789

 

 

$

(424

)

 

$

(177,878

)

 

$

77,491

 

 

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

 

4


 

SURROZEN, INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

 

 

Nine Months Ended September 30,

 

 

2023

 

 

2022

 

Operating activities:

 

 

 

 

 

Net loss

$

(34,129

)

 

$

(35,229

)

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

 

 

 

 

 

Depreciation and amortization

 

1,460

 

 

 

1,477

 

Stock-based compensation

 

3,200

 

 

 

2,972

 

Non-cash operating lease expense

 

937

 

 

 

1,024

 

Amortization of (discount) premium on marketable securities, net

 

(688

)

 

 

270

 

Change in fair value of warrant liabilities

 

(83

)

 

 

(6,969

)

Other expense related to the commitment shares issued to Lincoln Park

 

 

 

 

273

 

Changes in operating assets and liabilities:

 

 

 

 

 

Prepaid expenses and other current assets

 

955

 

 

 

(885

)

Other assets

 

38

 

 

 

(398

)

Accounts payable

 

(371

)

 

 

(2,365

)

Accrued and other liabilities

 

(2,728

)

 

 

(2,433

)

Operating lease liabilities

 

(1,643

)

 

 

(1,677

)

Net cash used in operating activities

 

(33,052

)

 

 

(43,940

)

 

 

 

 

 

 

Investing activities:

 

 

 

 

 

Purchases of property and equipment

 

(398

)

 

 

(580

)

Purchases of marketable securities

 

(28,044

)

 

 

(20,894

)

Proceeds from maturities of marketable securities

 

70,665

 

 

 

57,870

 

Net cash provided by investing activities

 

42,223

 

 

 

36,396

 

 

 

 

 

 

 

Financing activities:

 

 

 

 

Proceeds from issuance of common stock upon exercise of stock options

 

3

 

 

 

 

Proceeds from issuance of common stock upon employee stock plan purchases

 

187

 

 

 

 

Repurchase of early exercised stock options

 

(55

)

 

 

(16

)

Net cash provided by (used in) financing activities

 

135

 

 

 

(16

)