On November 18, 2021 ESSA Pharma Inc. ("ESSA", or the "Company") (NASDAQ: EPIX), a clinical-stage pharmaceutical company focused on developing novel therapies for the treatment of prostate cancer, reported financial results for the fiscal year ended September 30, 2021 (Press release, ESSA, NOV 18, 2021, View Source [SID1234595828]). All references to "$" in this release refer to United States dollars, unless otherwise indicated.
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"2021 has been a year of meaningful execution on all aspects of the development program of EPI-7386, our highly-selective, oral, small molecule inhibitor that uniquely targets the N-terminal domain of the androgen receptor for the treatment of patients with metastatic castration-resistant prostate cancer ("mCRPC")," stated David Parkinson, MD, President and CEO of ESSA. "During the year, we presented initial clinical data at a scientific conference that suggest a favorable pharmacological profile and provide clinical proof of concept for EPI-7386. In addition, we demonstrated through nuclear magnetic resonance ("NMR") studies that EPI-7386 binds to the N-terminal domain of the androgen receptor—the primary driver of prostate cancer growth. We were pleased to announce this year clinical collaborations with Janssen Research and Development LLC ("Janssen"), Astellas Pharma Inc. ("Astellas"), and Bayer, three leading companies with approved antiandrogen treatments for prostate cancer. These Phase 1/2 studies, anticipated to begin in late 2021 or early 2022, will evaluate EPI-7386 in combination with the companies’ respective antiandrogen therapies in earlier line mCRPC patients."
Dr. Parkinson continued: "As a result of the successful financing earlier this year, our cash and short-term investments of $195 million are expected to provide us a cash runway into 2024 and fully fund the current development programs, including the Phase 1a/1b monotherapy studies, Phase 2, preparatory work for a Phase 3 confirmatory study as well as commitments around the four Phase 1/2 combination studies with approved antiandrogens. In the Phase 1 monotherapy dose escalation study, we are currently dosing patients with EPI-7386 at 800 mg administered as 400 mg BID, and our goal remains to establish a recommended Phase 2 dose ("RP2D") for monotherapy during the first half of 2022, while commencing the expansion Phase 1b study soon thereafter. We look forward to presenting a clinical readout of the Phase 1a monotherapy trial in the first half of 2022."
Clinical and Corporate Highlights for 2021 Fiscal Year
On October 7, 2021, at the 2021 American Association for Cancer Research (AACR) (Free AACR Whitepaper) ("AACR"), National Cancer Institute ("NCI"), and European Organisation for Research and Treatment of Cancer ("EORTC") Virtual AACR-NCI-EORTC (Free AACR-NCI-EORTC Whitepaper) International Conference on Molecular Targets and Cancer Therapeutics (EORTC-NCI-AACR) (Free ASGCT Whitepaper) (Free EORTC-NCI-AACR Whitepaper), the Company presented preclinical data characterizing the mechanism of action of EPI-7386, including the results of NMR studies which confirm the binding of the compound to the N-terminal domain ("NTD") of the androgen receptor ("AR"), a region not currently targeted by other antiandrogen therapies. The data also demonstrate that the combination of EPI-7386 with enzalutamide results in complete inhibition of genome-wide androgen-induced AR binding, supporting the rationale for Phase 1/2 combination trials of EPI-7386 with approved antiandrogens in patients with mCRPC.
On April 28, 2021, the Company announced a clinical collaboration with Bayer to evaluate EPI-7386 in combination with Bayer’s androgen receptor inhibitor darolutamide in patients with mCRPC. Under the terms of the agreement, Bayer may sponsor and conduct a Phase 1/2 study to evaluate the safety, pharmacokinetics and efficacy of the combination of EPI-7386 and darolutamide in mCRPC patients. ESSA will supply EPI-7386 for the trial and will retain all rights to EPI-7386.
On April 10, 2021, the Company reported new preclinical data on EPI-7386 at the 2021 AACR (Free AACR Whitepaper) Annual Meeting demonstrating that in vitro EPI-7386 can prevent the androgen receptor from binding to genomic DNA and can inhibit AR related transcription in prostate cancer cell lines expressing AR splice variants including the AR-v567es variant. The results also demonstrate that combining EPI-7386 with enzalutamide in vitro results in a broader and deeper inhibition of the AR pathway.
On February 25, 2021, the Company announced a clinical collaboration with Astellas Pharma Inc. to evaluate the combination of EPI-7386 and Astellas/Pfizer’s androgen receptor inhibitor enzalutamide for patients with mCRPC. Under the terms of the agreement, ESSA will sponsor and conduct a Phase 1/2 study to evaluate the safety, tolerability and preliminary efficacy of the combination of EPI-7386 and enzalutamide in mCRPC patients who have not yet been treated with second-generation antiandrogen therapies. Astellas will supply enzalutamide for the trial. ESSA will retain all rights to EPI-7386.
On February 22, 2021, the Company completed an underwritten public offering for aggregate gross proceeds of $149,999,985, issuing a total of 5,555,555 common shares, at a public offering price of $27.00 per share.
On February 11, 2021, the Company presented favorable initial Phase 1 clinical pharmacology data of EPI-7386 for advanced forms of prostate cancer at the 2021 ASCO (Free ASCO Whitepaper) Genitourinary Cancers Symposium.
On January 13, 2021, the Company announced a clinical collaboration with Janssen to evaluate EPI-7386 in combination with abiraterone acetate/prednisone or apalutamide for patients with mCRPC. Under the terms of the agreement, Janssen may sponsor and conduct up to two Phase 1/2 studies evaluating the safety, tolerability and preliminary efficacy of the combination of EPI-7386 and apalutamide as well as the combination of EPI-7386 with abiraterone acetate plus prednisone in patients with mCRPC. Janssen will assume all costs associated with these studies other than the manufacturing costs associated with the clinical drug supply of EPI-7386. The parties will form a joint oversight committee for the clinical studies. ESSA will retain all rights to EPI-7386.
Summary Financial Results
Net Loss. ESSA recorded a net loss of $36.8 million ($0.96 loss per common share based on 38,480,378 weighted average common shares outstanding) for the year ended September 30, 2021, compared to a net loss of $23.4 million ($1.04 loss per common share based on 22,443,893 weighted average common shares outstanding) for the year ended September 30, 2020. For the year ended September 30, 2021, this included non-cash share-based payments of $9.5 million compared to $7.5 million for the prior year, recognized for stock options granted and vesting. The net loss for the fourth quarter ended September 30, 2021 was $8.5 million compared to a net loss of $4.6 million for the fourth quarter ended September 30, 2020.
Research and Development ("R&D") expenditures. R&D expenditures for the year ended September 30, 2021 were $24.3 million compared to $12.1 million for the year ended September 30, 2020 and includes non-cash costs related to share-based payments ($3.6M for year ended 2021 compared to $1.9M for year ended 2020). For the fourth quarter ended September 30, 2021, R&D expenditures were $6.3 million (net and gross), as compared to $2.2 million (net and gross) for the fourth quarter ended September 30, 2020. The increase in R&D expenditures for the full year and fourth quarter were primarily related to preclinical work leading to the filing of the IND for EPI-7386 in March 2020, the increased expenditure on chemistry and manufacturing of drug product, and clinical costs related to the Phase 1 clinical trial of EPI-7386 which commenced with the dosing of the first patient in July 2020.
General and administration ("G&A") expenditures. G&A expenditures for the year ended September 30, 2021 were $12.9 million compared to $11.4 million for the year ended September 30, 2020 and include non-cash costs related to share-based payments of $5.8M for the year ended 2021 compared to $5.6M for the year ended 2020. For the fourth quarter ended September 30, 2021, G&A expenditures were $2.9 million, compared to $2.2 million for the fourth quarter ended September 30, 2020. The increase in the full year and fourth quarter is the result of increased professional fees related to transitioning to be a domestic filer, higher salaries and benefits, as well as the non-cash share-based payments.
Liquidity and Outstanding Share Capital
At September 30, 2021, the Company had available cash reserves and short-term investments of $194.9 million, reflecting the gross proceeds of the February 2021 financing of approximately $150.0 million and July 2020 financing of $48.9 million, less operating expenses in the intervening period.
As of September 30, 2021, the Company had 43,984,346 common shares issued and outstanding.
In addition, as of September 30, 2021 there were 3,234,750 common shares issuable upon the exercise of warrants and broker warrants. This includes 2,920,000 prefunded warrants at an exercise price of $0.0001, and 314,750 warrants at a weighted average exercise price of $4.84. There were 6,803,230 common shares issuable upon the exercise of outstanding stock options at a weighted-average exercise price of $5.20 per common share.
About EPI-7386
EPI-7386 is an investigational, highly-selective, oral, small molecule inhibitor of the N-terminal domain of the androgen receptor. EPI-7386 is currently being studied in a Phase 1 clinical trial (NCT04421222) in men with mCRPC whose tumors have progressed on current standard-of-care therapies. The Phase I clinical trial of EPI-7386 began in calendar Q3 of 2020 following FDA allowance of our Investigational New Drug application and Health Canada acceptance. The U.S. FDA has granted Fast Track designation to EPI-7386 for the treatment of adult male patients with mCRPC resistant to standard-of-care treatment. ESSA retains all rights to EPI-7386 worldwide.