Annual report pursuant to Section 13 and 15(d)

Nature of Operations and Basis of Presentation

Nature of Operations and Basis of Presentation	12 Months Ended
Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Operations and Basis of Presentation	(1) Nature of Operations and Basis of Presentation Iterum Therapeutics plc (the Company) was incorporated under the laws of the Republic of Ireland in June 2015 as a limited company and re-registered as a public limited company on March 20, 2018. The Company maintains its registered office at Fitzwilliam Court, 1st Floor, Leeson Close, Dublin 2, Ireland. The Company commenced operations in November 2015. The Company licensed global rights to its novel anti-infective compound, sulopenem, from Pfizer Inc. (Pfizer). The Company is a clinical-stage pharmaceutical company dedicated to developing and commercializing sulopenem to be potentially the first oral penem available in the United States and the first and only oral and intravenous (IV) branded penem available globally. Since inception, the Company has devoted substantially all of its efforts to research and development, recruiting management and technical staff, and raising capital, and has financed its operations through the issuance of ordinary and convertible preferred shares, debt raised under a financing arrangement with Silicon Valley Bank (SVB) including the Paycheck Protection Program loan (PPP loan), a sub-award from the Trustees of Boston University under the Combating Antibiotic Resistant Bacteria Biopharmaceutical Accelerator (CARB-X) program and the proceeds of a private placement (Private Placement) and subsequent rights offering (Rights Offering) pursuant to which its wholly owned subsidiary, Iterum Therapeutics Bermuda Limited (Iterum Bermuda) issued and sold approximately $51.8 million aggregate principal amount of 6.500% Exchangeable Senior Subordinated Notes due 2025 (Exchangeable Notes) and $0.1 million aggregate principal amount of Limited Recourse Royalty-Linked Subordinated Notes (the RLNs and, together with the Exchangeable Notes, the Securities). The Company has not generated any product revenue. The Company is subject to risks and uncertainties common to early-stage companies in the pharmaceutical industry, including, but not limited to, the ability to secure additional capital to fund operations, failure to achieve regulatory approval, failure to successfully develop and commercialize its product candidates, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology and compliance with government regulations. Product candidates currently under development will require additional research and development efforts, including regulatory approval prior to commercialization. Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and include the accounts of the Company and its subsidiaries. Certain reclassifications have been made to prior period amounts to conform with the current period's presentation, including in connection with the application of the hierarchy for fair value measurements of short-term investments, and the classification, amortised cost and unrealized gains and losses of short-term investments. The Company's shareholders approved a reverse share split of the Company's ordinary shares on June 15, 2022, which became effective on August 17, 2022, (the Reverse Share Split). As of 5:00 p.m. Eastern Standard Time on August 17, 2022, every fifteen ordinary shares of $0.01 each (nominal value) in the authorized and unissued and authorized and issued share capital of the Company were consolidated into one ordinary share of $0.15 each (nominal value), and the nominal value of each ordinary share was subsequently reduced from $0.15 to $0.01 nominal value per share. No fractional shares were issued to any shareholders in connection with the Reverse Share Split. Shareholders who were otherwise entitled to receive a fractional ordinary share instead received a cash payment in an amount equal to the net cash proceeds attributable to the sale of such fractional entitlement following aggregation and sale by the Company on behalf of each of the relevant shareholders of the Company's ordinary shares, on the basis of prevailing market prices at such time. As the par value per share of the Company's shares remained at $0.01 per share following the Reverse Share Split, the difference between the total share capital at (par value) prior to the Reverse Share Split and the total share capital (par value) after the Reverse Share Split, has been reclassified as additional paid-in-capital on a retroactive basis. The number of ordinary shares reserved for issuance upon exercise of the Exchangeable Notes, outstanding share options and warrants or upon the vesting of outstanding restricted share units, was adjusted and proportionately decreased and the exercise price of all share options, Exchangeable Notes and warrants was proportionately increased. Additionally, the number of shares that may be the subject of future grants under our share plans was proportionally decreased. Accordingly, all historical share and per share information related to the issued and outstanding ordinary shares, the Exchangeable Notes, share options, restricted share units, warrants and shares reserved for future issuance under the Company's share plans have been adjusted to reflect the Reverse Share Split for all prior periods presented. The Company filed a universal shelf registration statement on Form S-3 with the SEC, which was declared effective on October 17, 2022 (File No. 333-267795), and pursuant to which the Company registered for sale up to $100.0 million of any combination of debt securities, ordinary shares, preferred shares, subscription rights, purchase contracts, units and/or warrants from time to time and at prices and on terms that the Company may determine. On October 7, 2022, the Company entered into a sales agreement with H.C. Wainwright & Co., LLC (HC Wainwright), as agent, pursuant to which the Company may offer and sell ordinary shares, nominal value $0.01 per share, for aggregate gross sales proceeds of up to $16.0 million (subject to the availability of ordinary shares), from time to time through HC Wainwright by any method permitted that is deemed to be an "at the market offering" as defined in Rule 415 (a)(4) promulgated under the Securities Act of 1933, as amended. In accordance with 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 aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date of issue of the consolidated financial statements. The Company has funded its operations to date primarily with proceeds from the sale of preferred shares and ordinary shares, warrants, debt raised under its financing arrangement with SVB including the PPP loan (both of which have been repaid), payments received under the CARB-X program and proceeds of the Private Placement and Rights Offering. The Company has incurred operating losses since inception, including net losses of $44,434, $91,564 and $52,006 for the years ended December 31, 2022, 2021 and 2020, respectively. The Company had an accumulated deficit of $422,927 as of December 31, 2022 and expects to continue to incur net losses for the foreseeable future. Management believes that its cash and cash equivalents balance of $21,092 and short-term investments of $39,712 at December 31, 2022 are sufficient to fund operations until mid-2024. In making this assessment management have considered the planned operations of the company and the ability to adjust its plans if required. In addition, in parallel, the Company is evaluating its corporate, strategic, financial and financing alternatives, with the goal of maximizing value for its stakeholders. These alternatives could potentially include the licensing, sale or divestiture of the Company’s assets or proprietary technologies, a sale of the Company, a merger or other business combination or another strategic transaction involving the Company. The evaluation of corporate, strategic, financial and financing alternatives may not result in any particular action or any transaction being pursued, entered into or consummated, and there is no assurance as to the timing, sequence or outcome of any action or transaction or series of actions or transactions.

Nature of Operations and Basis of Presentation

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of Operations and Basis of Presentation

(1)

Nature of Operations and Basis of Presentation

Iterum Therapeutics plc (the Company) was incorporated under the laws of the Republic of Ireland in June 2015 as a limited company and re-registered as a public limited company on March 20, 2018. The Company maintains its registered office at Fitzwilliam Court, 1st Floor, Leeson Close, Dublin 2, Ireland. The Company commenced operations in November 2015. The Company licensed global rights to its novel anti-infective compound, sulopenem, from Pfizer Inc. (Pfizer). The Company is a clinical-stage pharmaceutical company dedicated to developing and commercializing sulopenem to be potentially the first oral penem available in the United States and the first and only oral and intravenous (IV) branded penem available globally.

Since inception, the Company has devoted substantially all of its efforts to research and development, recruiting management and technical staff, and raising capital, and has financed its operations through the issuance of ordinary and convertible preferred shares, debt raised under a financing arrangement with Silicon Valley Bank (SVB) including the Paycheck Protection Program loan (PPP loan), a sub-award from the Trustees of Boston University under the Combating Antibiotic Resistant Bacteria Biopharmaceutical Accelerator (CARB-X) program and the proceeds of a private placement (Private Placement) and subsequent rights offering (Rights Offering) pursuant to which its wholly owned subsidiary, Iterum Therapeutics Bermuda Limited (Iterum Bermuda) issued and sold approximately $51.8 million aggregate principal amount of 6.500% Exchangeable Senior Subordinated Notes due 2025 (Exchangeable Notes) and $0.1 million aggregate principal amount of Limited Recourse Royalty-Linked Subordinated Notes (the RLNs and, together with the Exchangeable Notes, the Securities). The Company has not generated any product revenue. The Company is subject to risks and uncertainties common to early-stage companies in the pharmaceutical industry, including, but not limited to, the ability to secure additional capital to fund operations, failure to achieve regulatory approval, failure to successfully develop and commercialize its product candidates, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology and compliance with government regulations. Product candidates currently under development will require additional research and development efforts, including regulatory approval prior to commercialization.

Even if the Company’s product development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales.

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and include the accounts of the Company and its subsidiaries. Certain reclassifications have been made to prior period amounts to conform with the current period's presentation, including in connection with the application of the hierarchy for fair value measurements of short-term investments, and the classification, amortised cost and unrealized gains and losses of short-term investments.

The Company's shareholders approved a reverse share split of the Company's ordinary shares on June 15, 2022, which became effective on August 17, 2022, (the Reverse Share Split). As of 5:00 p.m. Eastern Standard Time on August 17, 2022, every fifteen ordinary shares of $0.01 each (nominal value) in the authorized and unissued and authorized and issued share capital of the Company were consolidated into one ordinary share of $0.15 each (nominal value), and the nominal value of each ordinary share was subsequently reduced from $0.15 to $0.01 nominal value per share. No fractional shares were issued to any shareholders in connection with the Reverse Share Split. Shareholders who were otherwise entitled to receive a fractional ordinary share instead received a cash payment in an amount equal to the net cash proceeds attributable to the sale of such fractional entitlement following aggregation and sale by the Company on behalf of each of the relevant shareholders of the Company's ordinary shares, on the basis of prevailing market prices at such time. As the par value per share of the Company's shares remained at $0.01 per share following the Reverse Share Split, the difference between the total share capital at (par value) prior to the Reverse Share Split and the total share capital (par value) after the Reverse Share Split, has been reclassified as additional paid-in-capital on a retroactive basis. The number of ordinary shares reserved for issuance upon exercise of the Exchangeable Notes, outstanding share options and warrants or upon the vesting of outstanding restricted share units, was adjusted and proportionately decreased and the exercise price of all share options, Exchangeable Notes and warrants was proportionately increased. Additionally, the number of shares that may be the subject of future grants under our share plans was proportionally decreased. Accordingly, all historical share and per share information related to the issued and outstanding ordinary shares, the Exchangeable Notes, share options, restricted share units, warrants and shares reserved for future issuance under the Company's share plans have been adjusted to reflect the Reverse Share Split for all prior periods presented.

The Company filed a universal shelf registration statement on Form S-3 with the SEC, which was declared effective on October 17, 2022 (File No. 333-267795), and pursuant to which the Company registered for sale up to $100.0 million of any combination of debt securities, ordinary shares, preferred shares, subscription rights, purchase contracts, units and/or warrants from time to time and at prices and on terms that the Company may determine. On October 7, 2022, the Company entered into a sales agreement with H.C. Wainwright & Co., LLC (HC Wainwright), as agent, pursuant to which the Company may offer and sell ordinary shares, nominal value $0.01 per share, for aggregate gross sales proceeds of up to $16.0 million (subject to the availability of ordinary shares), from time to time through HC Wainwright by any method permitted that is deemed to be an "at the market offering" as defined in Rule 415 (a)(4) promulgated under the Securities Act of 1933, as amended.

In accordance with 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 aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date of issue of the consolidated financial statements.

The Company has funded its operations to date primarily with proceeds from the sale of preferred shares and ordinary shares, warrants, debt raised under its financing arrangement with SVB including the PPP loan (both of which have been repaid), payments received under the CARB-X program and proceeds of the Private Placement and Rights Offering. The Company has incurred operating losses since inception, including net losses of $44,434, $91,564 and $52,006 for the years ended December 31, 2022, 2021 and 2020, respectively. The Company had an accumulated deficit of $422,927 as of December 31, 2022 and expects to continue to incur net losses for the foreseeable future. Management believes that its cash and cash equivalents balance of $21,092 and short-term investments of $39,712 at December 31, 2022 are sufficient to fund operations until mid-2024. In making this assessment management have considered the planned operations of the company and the ability to adjust its plans if required.

In addition, in parallel, the Company is evaluating its corporate, strategic, financial and financing alternatives, with the goal of maximizing value for its stakeholders. These alternatives could potentially include the licensing, sale or divestiture of the Company’s assets or proprietary technologies, a sale of the Company, a merger or other business combination or another strategic transaction involving the Company. The evaluation of corporate, strategic, financial and financing alternatives may not result in any particular action or any transaction being pursued, entered into or consummated, and there is no assurance as to the timing, sequence or outcome of any action or transaction or series of actions or transactions.