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Nature of the Business
6 Months Ended
Jun. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Nature of the Business Nature of the Business
Praxis Precision Medicines, Inc. (“Praxis” or the “Company”) is a clinical-stage biopharmaceutical company translating insights from genetic epilepsies into the development of therapies for central nervous system, or CNS, disorders characterized by neuronal excitation-inhibition imbalance. Normal brain function requires a delicate balance of excitation and inhibition in neuronal circuits, which, when dysregulated, can lead to abnormal function and both rare and more prevalent neurological disorders. The Company is applying genetic insights to the discovery and development of therapies for neurological disorders through two proprietary platforms, using its understanding of shared biological targets and circuits in the brain. Each platform has multiple programs currently, with significant potential for additional program and indication expansion:
Cerebrum™, the Company's small molecule platform, utilizes deep understanding of neuronal excitability and neuronal networks and applies a series of computational and experimental tools to develop orally available precision therapies
Solidus™, the Company's antisense oligonucleotide, or ASO, platform, is an efficient, targeted precision medicine discovery and development engine anchored on a proprietary, computational methodology
The Company's platforms utilize a deliberate, pragmatic and patient-guided approach, leveraging a suite of translational tools, including novel transgenic and predictive translational animal models and electrophysiology markers, to enable an efficient path to proof-of-concept in patients. Through this approach, the Company has established a diversified, multimodal CNS portfolio with four clinical-stage product candidates across movement disorders and epilepsy. For the Company's most advanced product candidate under the Cerebrum™ platform, ulixacaltamide (also known as PRAX-944), topline results from the Phase 2b Essential1 clinical trial in essential tremor ("ET"), were announced in the first quarter of 2023. The Company intends to initiate two Phase 3 studies in ET in the fourth quarter of 2023, with topline results expected in the second half of 2024. The Company initiated its PRAX-562 Phase 2 EMBOLD study in the first quarter of 2023 and expects to announce topline results in the fourth quarter of 2023. The Company also announced positive results from its PRAX-628 Phase 1 study in May 2023. In June 2023, the Company initiated a Phase 2 proof of concept study evaluating PRAX-628 in patients with a Photo Paroxysmal Response ("PPR"), with results anticipated by year-end 2023. Upon completion of the PPR study, Praxis plans to initiate a Phase 2 study of PRAX-628 in focal epilepsy in the first half of 2024. For the Company's most advanced product candidate under the Solidus™ platform, PRAX-222, it initiated the first dose cohort of its EMBRAVE study in the second quarter of 2023 and expects to announce topline results in the second half of 2023.
Praxis was incorporated in 2015 and commenced operations in 2016. The Company has funded its operations primarily with proceeds from the issuance of redeemable convertible preferred stock, and from the sale of common stock and pre-funded warrants through an initial public offering, follow-on public offerings and at-the-market offerings under its shelf registration statement. From inception through June 30, 2023, the Company raised $613.6 million in aggregate cash proceeds from these transactions, net of issuance costs.
The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including but not limited to, risks associated with completing preclinical studies and clinical trials, receiving regulatory approvals for product candidates, development by competitors of new biopharmaceutical products, dependence on key personnel, protection of proprietary technology, compliance with government regulations and the ability to secure additional capital to fund operations. Programs currently under development will require significant additional research and development efforts, including preclinical and clinical testing and regulatory approval, prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel and infrastructure and extensive compliance-reporting capabilities. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will realize revenue from product sales.
Liquidity
In accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40), the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that these condensed consolidated financial statements are issued.
The Company has incurred recurring losses since its inception, including a net loss of $71.8 million for the six months ended June 30, 2023. In addition, as of June 30, 2023, the Company had an accumulated deficit of $602.4 million. The Company expects to continue to generate operating losses for the foreseeable future.
The Company expects that its cash and cash equivalents as of June 30, 2023 of $124.3 million will be sufficient to fund the operating expenditures and capital expenditure requirements necessary to advance its research efforts and clinical trials for at least one year from the date of issuance of these condensed consolidated financial statements. The analysis included consideration of the Company's current financial needs and ongoing research and development plans, which are limited to advancing product candidates through, but not beyond, their current clinical trials and the ulixacaltamide Phase 3 clinical trials in ET. The future viability of the Company is dependent on its ability to raise additional capital to finance its operations. The Company’s inability to raise capital as and when needed could have a negative impact on its financial condition and ability to pursue its business strategies. There can be no assurance that the current operating plan will be achieved or that additional funding will be available on terms acceptable to the Company, or at all.