KALA BIO, Inc. Files 2023 Annual Report on Form 10-K

TL;DR

<b>KALA BIO, Inc. filed its 2023 10-K, detailing its financial position, equity structure, and significant corporate events.</b>

AI Summary

KALA BIO, Inc. (KALA) filed a Annual Report (10-K) with the SEC on March 29, 2024. KALA BIO, Inc. (KALA) filed its 2023 Form 10-K on March 29, 2024. The company's principal executive offices are located at 1167 Massachusetts Avenue, Arlington, MA 02476. KALA was formerly known as Kala Pharmaceuticals, Inc., with a name change effective December 23, 2009. The filing includes details on various equity instruments, including Series D Redeemable Preferred Stock, Series G Nonredeemable Convertible Preferred Stock, and Series E Non-Redeemable Non-Controlling Preferred Stock. Key dates related to securities purchase agreements and stock option grants are documented throughout the filing.

Why It Matters

For investors and stakeholders tracking KALA BIO, Inc., this filing contains several important signals. This 10-K provides a comprehensive overview of KALA BIO's financial health and corporate structure as of December 31, 2023, which is crucial for investors to assess the company's performance and future prospects. The detailed information on various preferred stock series and securities purchase agreements highlights significant capital raising and financing activities, impacting the company's equity structure and potential dilution.

Risk Assessment

Risk Level: medium — KALA BIO, Inc. shows moderate risk based on this filing. The company has a complex capital structure with multiple series of preferred stock and ongoing securities purchase agreements, which could indicate financial complexities or future dilution risks.

Analyst Insight

Investors should carefully review the detailed breakdown of KALA BIO's equity structure and recent financing activities to understand potential impacts on share value and ownership.

Key Numbers

• 20231231 — Fiscal Year End (Conformed period of report)
• 20240329 — Filing Date (As of date)
• 0001479419 — Central Index Key (Filer's Central Index Key)
• 270604595 — IRS Number (Filer's IRS Number)

Key Players & Entities

• KALA BIO, Inc. (company) — Filer name
• KALA (company) — Ticker symbol
• 1167 Massachusetts Avenue, Arlington, MA 02476 (address) — Business address
• Kala Pharmaceuticals, Inc. (company) — Former company name
• 20091223 (date) — Date of name change
• 20231231 (date) — Fiscal year end
• 20240329 (date) — Filing date

FAQ

Risk Factors

• Complex Capital Structure [medium — financial]: The company has a complex capital structure involving multiple series of preferred stock and various securities purchase agreements, which could lead to future dilution or financial complexities.

Key Dates

• 2023-12-31: Fiscal Year End — Marks the end of the reporting period for the 10-K.
• 2024-03-29: Filing Date — Date the 10-K was officially filed with the SEC.
• 2024-03-25: Securities Purchase Agreement 2024 — Indicates a recent agreement related to securities purchase.
• 2022-12-01: Securities Purchase Agreement Tranche One — Details a significant past agreement for securities purchase.

Glossary

10-K

An annual report required by the U.S. Securities and Exchange Commission (SEC), which gives a comprehensive summary of a company's financial performance. (This is the primary filing type, providing the core financial and operational data for the year.)

Key Financial Figures

• $0.001 — nge on which registered Common Stock, $0.001 par value per share KALA The Nasdaq
• $629.4 million — 2023, we had an accumulated deficit of $629.4 million. Our limited operating history and ou
• $60.0 million — lcon paid us an upfront cash payment of $60.0 million upon the closing of the sale of the Com
• $25.0 million — ales milestone payments as follows: (1) $25.0 million upon the achievement of $50.0 million o
• $50.0 million — ) $25.0 million upon the achievement of $50.0 million or more in aggregate worldwide 6 Tab
• $65.0 million — a calendar year from 2023 to 2028, (2) $65.0 million upon the achievement of $100.0 million
• $100.0 million — ) $65.0 million upon the achievement of $100.0 million or more in aggregate worldwide net sale
• $75.0 million — a calendar year from 2023 to 2028, (3) $75.0 million upon the achievement of $175.0 million
• $175.0 million — ) $75.0 million upon the achievement of $175.0 million or more in aggregate worldwide net sale
• $160.0 million — calendar year from 2023 to 2029 and (4) $160.0 million upon the achievement of $250.0 million
• $250.0 million — $160.0 million upon the achievement of $250.0 million or more in aggregate worldwide net sale

Filing Documents

• kala-20231231x10k.htm (10-K) — 3196KB
• kala-20231231xex3d1.htm (EX-3.1) — 332KB
• kala-20231231xex4d3.htm (EX-4.3) — 27KB
• kala-20231231xex21d1.htm (EX-21.1) — 5KB
• kala-20231231xex23d1.htm (EX-23.1) — 3KB
• kala-20231231xex31d1.htm (EX-31.1) — 9KB
• kala-20231231xex31d2.htm (EX-31.2) — 9KB
• kala-20231231xex32d1.htm (EX-32.1) — 5KB
• kala-20231231xex4d2.htm (EX-4.2) — 6KB
• kala-20231231xex97d1.htm (EX-97.1) — 19KB
• kala-20231231x10k006.jpg (GRAPHIC) — 42KB
• kala-20231231x10k007.jpg (GRAPHIC) — 64KB
• kala-20231231x10k008.jpg (GRAPHIC) — 35KB
• kala-20231231x10k009.jpg (GRAPHIC) — 20KB
• kala-20231231x10k010.jpg (GRAPHIC) — 44KB
• kala-20231231x10k011.jpg (GRAPHIC) — 28KB
• kala-20231231x10k012.jpg (GRAPHIC) — 44KB
• 0001558370-24-004326.txt (&nbsp;) — 14172KB
• kala-20231231.xsd (EX-101.SCH) — 96KB
• kala-20231231_cal.xml (EX-101.CAL) — 80KB
• kala-20231231_def.xml (EX-101.DEF) — 482KB
• kala-20231231_lab.xml (EX-101.LAB) — 824KB
• kala-20231231_pre.xml (EX-101.PRE) — 701KB
• kala-20231231x10k_htm.xml (XML) — 2028KB

Business

Business 6 Item 1A.

Risk Factors

Risk Factors 46 Item 1B. Unresolved Staff Comments 97 Item 1C. Cybersecurity 98 Item 2.

Properties

Properties 98 Item 3.

Legal Proceedings

Legal Proceedings 99 Item 4. Mine Safety Disclosures 99 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 100 Item 6. [ Reserved ] 100 Item 7.

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

Management's Discussion and Analysis of Financial Condition and Results of Operations 101 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 118 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 118 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 119 Item 9A.

Controls and Procedures

Controls and Procedures 119 Item 9B. Other Information 120 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 120 PART III Item 10. Directors, Executive Officers and Corporate Governance 120 Item 11.

Executive Compensation

Executive Compensation 120 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 120 Item 13. Certain Relationships and Related Transactions, and Director Independence 120 Item 14. Principal Accountant Fees and Services 120 PART IV Item 15. Exhibits and Financial Statement Schedules 121 Item 16. Form 10-K Summary 124

Signatures

Signatures 125 Table of Contents References to KALA Throughout this Annual Report on Form 10-K, the "Company," "KALA", "KALA BIO," "we," "us," and "our," except where the context requires otherwise, refer to KALA BIO, Inc. and its consolidated subsidiaries, and "our board of directors" refers to the board of directors of KALA BIO, Inc. On August 2, 2023, we changed our name from Kala Pharmaceuticals, Inc. to Kala Bio , Inc. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INDUSTRY DATA This Annual Report on Form 10-K contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this Annual Report on Form 10-K, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans and objectives of management, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "potential," "predict," "project," "should," "target," "would" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. The forward-looking statements in this Annual Report on Form 10-K include, among other things, statements about: our expectations with respect to our dependency on and potential advantages of KPI-012, our product candidate for the treatment of persistent corneal epithelial defects, or PCED; our expectations with respect to the potential impacts the sale of our commercial business to Alcon Pharmaceuticals Ltd. and Alcon Vision, LLC, which we refer collectively as Alcon, will have on our business, results of operations and financial condition; our expectations with respect to, and the amount of, future milestone payments we may receive from Alcon in connection with the sale of our commercial business; our expectations with re

Business

Item 1. Business Overview We are a clinical-stage biopharmaceutical company dedicated to the research, development and commercialization of innovative therapies for rare and severe diseases of the front and back of the eye. Our product candidate, KPI-012, which we acquired from Combangio, Inc., or Combangio, on November 15, 2021, is a mesenchymal stem cell secretome, or MSC-S, and is currently in clinical development for the treatment of persistent corneal epithelial defects, or PCED, a rare disease of impaired corneal healing. Based on the positive results of a Phase 1b clinical safety and efficacy trial of KPI-012 in patients with PCED, along with favorable preclinical safety and efficacy results, we submitted an investigational new drug application, or IND, to the U.S. Food and Drug Administration, or FDA, which was accepted in December 2022. In February 2023, we dosed our first patient in our CHASE ( C orneal H ealing A fter SE cretome therapy) Phase 2b clinical trial of KPI-012 for PCED in the United States, or the CHASE trial. The CHASE trial is comprised of two patient cohorts. On March 27, 2023, we announced positive safety data from the first cohort of the CHASE trial, which is an open-label study to evaluate the safety of the high dose of KPI-012 ophthalmic solution (3 U/mL) dosed topically four times per day, or QID, in two patients. Both patients in the first cohort successfully completed at least one week of dosing with no safety issues observed. We have initiated the second and final patient cohort of the CHASE trial in the United States, which is a multicenter, randomized, double-masked, vehicle-controlled, parallel-group trial to evaluate the safety and tolerability of two doses of KPI-012 ophthalmic solution (3 U/mL and 1 U/mL) versus vehicle dosed topically QID for 56 days in approximately 90 patients. We plan to add trial sites in Latin America, subject to regulatory approval. The primary endpoint of the trial is the complete healing of th

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