INSMED Inc. Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>INSMED Inc. filed its Q1 2024 10-Q, detailing financial performance and risks for the quarter ending March 31, 2024.</b>

AI Summary

INSMED Inc (INSM) filed a Quarterly Report (10-Q) with the SEC on May 9, 2024. INSMED Inc. reported financial results for the quarter ended March 31, 2024. The filing covers the period from January 1, 2024, to March 31, 2024. Key financial data from previous periods, including December 31, 2023, and March 31, 2023, are referenced. Information regarding common stock, additional paid-in capital, retained earnings, and accumulated other comprehensive income is detailed. The filing also includes disclosures related to customer concentration risk for specific customers (A, B, C).

Why It Matters

For investors and stakeholders tracking INSMED Inc, this filing contains several important signals. This 10-Q filing provides investors with a crucial update on INSMED's financial health and operational performance during the first quarter of 2024. Understanding the customer concentration risk and changes in equity accounts is vital for assessing the company's stability and future growth prospects.

Risk Assessment

Risk Level: medium — INSMED Inc shows moderate risk based on this filing. The company's reliance on specific customers (A, B, C) for sales revenue presents a medium risk, as a loss of any of these customers could significantly impact financial results.

Analyst Insight

Investors should closely monitor INSMED's customer relationships and revenue diversification strategies in upcoming filings.

Key Numbers

• 2024-03-31 — Period End Date (Quarterly report period)
• 2024-01-01 — Period Start Date (Quarterly report period)
• 2023-03-31 — Prior Period End Date (Comparative financial data)
• 2023-01-01 — Prior Period Start Date (Comparative financial data)

Key Players & Entities

• INSMED Inc. (company) — Filer
• 2024-03-31 (date) — Period of report
• 2024-05-09 (date) — Filed as of date
• 000-30739 (other) — SEC file number
• 2834 (other) — Standard Industrial Classification (Pharmaceutical Preparations)
• VA (other) — State of incorporation
• Customer A (company) — Customer concentration risk
• Customer B (company) — Customer concentration risk

FAQ

Risk Factors

• Customer Concentration Risk [medium — market]: The company faces risk due to significant reliance on a few customers for sales revenue, specifically mentioning Customers A, B, and C.

Industry Context

INSMED Inc. operates within the pharmaceutical preparations industry, focusing on the development and commercialization of pharmaceutical products.

Regulatory Implications

As a publicly traded company, INSMED Inc. is subject to SEC regulations, including the requirement to file quarterly reports (10-Q) to disclose financial and operational information.

What Investors Should Do

1. Review INSMED's detailed financial statements for Q1 2024.
2. Analyze the impact of customer concentration risk on future revenue streams.
3. Compare Q1 2024 performance against prior periods and industry benchmarks.

Key Dates

• 2024-03-31: Quarter End — End of the reporting period for the 10-Q filing.
• 2024-05-09: Filing Date — Date the 10-Q was officially submitted to the SEC.

Year-Over-Year Comparison

This filing provides the Q1 2024 financial data, updating the information previously reported in the annual report (10-K) and prior quarterly filings.

Key Financial Figures

• $0.01 — ich registered Common stock, par value $0.01 per share INSM Nasdaq Global Select Mar

Filing Documents

• insm-20240331.htm (10-Q) — 1121KB
• insm-20240331ex311.htm (EX-31.1) — 9KB
• insm-20240331ex312.htm (EX-31.2) — 9KB
• insm-20240331ex321.htm (EX-32.1) — 6KB
• insm-20240331ex322.htm (EX-32.2) — 6KB
• 0001104506-24-000016.txt (&nbsp;) — 7464KB
• insm-20240331.xsd (EX-101.SCH) — 52KB
• insm-20240331_cal.xml (EX-101.CAL) — 74KB
• insm-20240331_def.xml (EX-101.DEF) — 342KB
• insm-20240331_lab.xml (EX-101.LAB) — 655KB
• insm-20240331_pre.xml (EX-101.PRE) — 528KB
• insm-20240331_htm.xml (XML) — 965KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION ITEM 1 Consolidated Financial Statements Consolidated Balance Sheets as of March 3 1 , 202 4 (unaudited) and December 31, 202 3 3 Consolidated Statements of Comprehensive Loss (unaudited) for the three months ended March 31 , 202 4 and 202 3 4 Consolidated Statements of Shareholders' Deficit (unaudited) for the three months ended March 31 , 202 4 and 202 3 5 Consolidated Statements of Cash Flows (unaudited) for the three months ended March 3 1 , 202 4 and 202 3 6

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 7 ITEM 2

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

Management's Discussion and Analysis of Financial Condition and Results of Operations 29 ITEM 3

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 42 ITEM 4

Controls and Procedures

Controls and Procedures 43

OTHER INFORMATION

PART II. OTHER INFORMATION ITEM 1

Legal Proceedings

Legal Proceedings 43 ITEM 1A

Risk Factors

Risk Factors 43 ITEM 2 Unregistered Sales of Equity Securities , Use of Proceeds , and Issuer Purchases of Equity Securities 44 ITEM 5 Other Information 44 ITEM 6 Exhibits 45 SIGNATURE 46 Unless the context otherwise indicates, references in this Form 10-Q to "Insmed Incorporated" refers to Insmed Incorporated, a Virginia corporation, and the "Company," "Insmed," "we," "us" and "our" refer to Insmed Incorporated together with its consolidated subsidiaries. INSMED, PULMOVANCE, ARIKARES and ARIKAYCE are trademarks of Insmed Incorporated. This Form 10-Q also contains trademarks of third parties. Each trademark of another company appearing in this Form 10-Q is the property of its owner. 2

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

CONSOLIDATED FINANCIAL STATEMENTS

ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS INSMED INCORPORATED Consolidated Balance Sheets (in thousands, except par value and share data) As of As of March 31, 2024 December 31, 2023 (unaudited) Assets Current assets: Cash and cash equivalents $ 595,729 $ 482,374 Marketable securities — 298,073 Accounts receivable 37,162 41,189 Inventory 82,957 83,248 Prepaid expenses and other current assets 42,874 24,179 Total current assets 758,722 929,063 Fixed assets, net 68,660 65,384 Finance lease right-of-use assets 20,307 20,985 Operating lease right-of-use assets 17,157 18,017 Intangibles, net 62,441 63,704 Goodwill 136,110 136,110 Other assets 95,698 96,574 Total assets $ 1,159,095 $ 1,329,837 Liabilities and shareholders' equity Current liabilities: Accounts payable and accrued liabilities $ 189,362 $ 214,987 Current portion of long-term debt 224,194 — Finance lease liabilities 2,695 2,610 Operating lease liabilities 4,609 8,032 Total current liabilities 420,860 225,629 Debt, long-term 939,081 1,155,313 Royalty financing agreement 156,967 155,034 Contingent consideration 63,700 84,600 Finance lease liabilities, long-term 26,320 27,026 Operating lease liabilities, long-term 13,809 11,013 Other long-term liabilities 3,166 3,145 Total liabilities 1,623,903 1,661,760 Shareholders' equity: Common stock, $ 0.01 par value; 500,000,000 authorized shares, 148,560,882 and 147,977,960 issued and outstanding shares at March 31, 2024 and December 31, 2023, respectively 1,486 1,480 Additional paid-in capital 3,138,578 3,113,487 Accumulated deficit ( 3,603,236 ) ( 3,446,145 ) Accumulated other comprehensive loss ( 1,636 ) ( 745 ) Total shareholders' deficit ( 464,808 ) ( 331,923 ) Total liabilities and shareholders' deficit $ 1,159,095 $ 1,329,837 See accompanying notes to the unaudited consolidated financial statements 3 INSMED INCORPORATED Consolidated Statements of Comprehensive Loss (unaudited) (in thousands, except per share

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. The Company and Basis of Presentation Insmed is a global biopharmaceutical company on a mission to transform the lives of patients with serious and rare diseases. The Company's first commercial product, ARIKAYCE, is approved in the United States (US) as ARIKAYCE (amikacin liposome inhalation suspension), in Europe as ARIKAYCE Liposomal 590 mg Nebuliser Dispersion and in Japan as ARIKAYCE inhalation 590 mg (amikacin sulfate inhalation drug product). ARIKAYCE received accelerated approval in the US in September 2018 for the treatment of Mycobacterium avium complex (MAC) lung disease as part of a combination antibacterial drug regimen for adult patients with limited or no alternative treatment options in a refractory setting. In October 2020, the European Commission (EC) approved ARIKAYCE for the treatment of nontuberculous mycobacterial (NTM) lung infections caused by MAC in adults with limited treatment options who do not have cystic fibrosis (CF). In March 2021, Japan's Ministry of Health, Labour and Welfare (MHLW) approved ARIKAYCE for the treatment of patients with NTM lung disease caused by MAC who did not sufficiently respond to prior treatment with a multidrug regimen. NTM lung disease caused by MAC (which the Company refers to as MAC lung disease) is a rare and often chronic infection that can cause irreversible lung damage and can be fatal. The Company's pipeline includes clinical-stage programs, brensocatib and treprostinil palmitil inhalation powder (TPIP), as well as other early-stage research programs. Brensocatib is a small molecule, oral, reversible inhibitor of dipeptidyl peptidase 1 (DPP1), which the Company is developing for the treatment of patients with bronchiectasis and other neutrophil-mediated diseases, including chronic rhinosinusitis without nasal polyps (CRSsNP). TPIP is an inhaled formulation of the treprostinil prodrug treprostinil palmitil which may offer a differentiated product profile f

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 2. Summary of Significant Accounting Policies (Continued) determining if the carrying value of such assets is less than the sum of the undiscounted future cash flows of the assets. If such assets are found to not be recoverable, the Company measures the amount of the impairment by comparing the carrying value of the assets to the fair value of the assets. Business Combinations and Asset Acquisitions —The Company evaluates acquisitions of assets and other similar transactions to assess whether or not the transaction should be accounted for as a business combination or asset acquisition by first applying a screen to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If the screen is met, the transaction is accounted for as an asset acquisition. If the screen is not met, further determination is required as to whether or not the Company has acquired inputs and processes that have the ability to create outputs, which would meet the requirements of a business. If determined to be a business combination, the Company accounts for the transaction under the acquisition method of accounting as indicated in ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which requires the acquiring entity in a business combination to recognize the fair value of all assets acquired, liabilities assumed, and any non-controlling interest in the acquiree and establishes the acquisition date as the fair value measurement point. Accordingly, the Company recognizes assets acquired and liabilities assumed in business combinations, including contingent assets and liabilities, and non-controlling interest in the acquiree based on the fair value estimates as of the date of acquisition. In accordance with ASC 805, Business Combinations, the Company recognizes and measures goodwill as of the ac

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 2. Summary of Significant Accounting Policies (Continued) intangible asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. The Company considers many factors in evaluating whether the value of its intangible assets with indefinite lives may not be recoverable, including, but not limited to, expected growth rates, the cost of equity and debt capital, general economic conditions, the Company's outlook and market performance of the Company's industry and recent and forecasted financial performance. The Company performs a qualitative test for its indefinite-lived intangible assets annually as of October 1. Goodwill —Goodwill represents the amount of consideration paid in excess of the fair value of net assets acquired as a result of the Company's business acquisitions accounted for using the acquisition method of accounting. Goodwill is not amortized and is subject to impairment testing at a reporting unit level on an annual basis or when a triggering event occurs that may indicate the carrying value of the goodwill is impaired. An entity is permitted to first assess qualitative factors to determine if a quantitative impairment test is necessary. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that the fair value of the reporting unit is less than its carrying amount. As of March 31, 2024 and December 31, 2023, the Company continues to operate as one reporting unit. The Company will perform its next annual impairment testing for goodwill as of October 1, 2024. See Note 6 - Intangibles, Net and Goodwill for further details. Leases —A lease is a contract, or part of a contract, that conv