On March 28, 2022 Fortress Biotech, Inc. (NASDAQ: FBIO) ("Fortress"), an innovative biopharmaceutical company focused on efficiently acquiring, developing and commercializing or monetizing promising therapeutic products and product candidates, reported financial results and recent corporate highlights for the full-year ended December 31, 2021 (Press release, Fortress Biotech, MAR 28, 2022, View Source [SID1234611064]).

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Lindsay A. Rosenwald, M.D., Fortress’ Chairman, President and Chief Executive Officer, said, "Fortress and its partner companies had an exceptional year in 2021, generating a record-setting annual net revenue of $68.8 million, representing more than 50% growth over 2020. We also began to realize the value of our monetization strategy when AstraZeneca acquired Caelum Biosciences ("Caelum"), a company founded by Fortress, during the fourth quarter of 2021, when we received a $56.9 million payment for our investment in Caelum. Fortress has the potential to receive up to an additional approximately $155 million in future milestone payments from the transaction, which includes proceeds from the release of escrow funds. Our subsidiary Cyprium Therapeutics ("Cyprium") executed an agreement with Sentynl Therapeutics to commit development funding for and contingently acquire Cyprium’s proprietary rights to CUTX-101, its Copper Histidinate product candidate for the treatment of Menkes disease, upon FDA approval. Also of note, Journey Medical Corporation ("Journey Medical") completed its $30.6 million initial public offering ("IPO"), net of discounts and other offering costs, launched Accutane (isotretinoin), acquired Qbrexza (glycopyrronium) from Dermira, Inc. and entered into a collaboration agreement with Dr. Reddy’s Laboratories Ltd. to develop and commercialize DFD-29 (minocycline modified release capsules 40 mg) for the treatment of rosacea."

Dr. Rosenwald continued, "Looking ahead in 2022, we anticipate continued progress and growth from our nine marketed prescription pharmaceutical products and over 30 product candidates in development. We have 30 ongoing clinical trials, including four product candidates in seven2 ongoing pivotal clinical trials. We expect the rolling submission of the New Drug Application ("NDA") for CUTX-101 to be complete in mid-2022. After announcing positive top-line results from the registration-enabling study of cosibelimab in metastatic cutaneous squamous cell carcinoma ("cSCC") in January, our partner company Checkpoint Therapeutics, Inc. ("Checkpoint") intends to submit a Biologics License Application ("BLA") for cosibelimab in 2022, followed thereafter by a Marketing Authorization Application submission in Europe. Mustang Bio, Inc. ("Mustang Bio"), another one of our partner companies, plans to initiate a multicenter Phase 1/2 clinical trial investigating the safety and efficacy of MB-106, a CD20-targeted, autologous CAR T cell therapy for relapsed or refractory B-cell non-Hodgkin lymphomas ("B-NHL") and chronic lymphocytic leukemia ("CLL") in the first half of 2022. Mustang Bio also plans to enroll the first patient in a pivotal multicenter Phase 2 clinical trial to evaluate MB-107, a lentiviral gene therapy for the treatment of infants under the age of two with X-linked severe combined immunodeficiency ("XSCID") in the second half of 2022. This ongoing advancement showcases the ability of Fortress’ business model to generate value for our shareholders and develop innovative therapies to help patients with unmet needs across multiple disease areas."

2021 and Recent Corporate Highlights3:

Marketed Dermatology Products and Product Candidates

Journey Medical currently has nine prescription dermatology products. In 2021 and early 2022, Journey Medical acquired and launched four prescription dermatology products including Accutane, Qbrexza, Amzeeq and Zilxi, and two product candidates, DFD-29 and FCD105.
Our products generated net revenues of $63.1 million for full-year 2021, compared to full-year 2020 net revenues of $44.5 million, representing growth of 42%.
In March 2022, Journey Medical dosed the first patient in the Phase 3 clinical program of DFD-29 for the treatment of papulopustular rosacea. Topline data is anticipated in the first quarter of 2023 with an NDA filing expected in the second half of 2023.
In February 2022, Journey Medical received notice from its exclusive licensing partner in Japan, Maruho Co., Ltd. ("Maruho"), that Japan’s Ministry of Health, Labor and Welfare ("MHLW") approved Rapifort Wipes 2.5% (glycopyrronium tosylate hydrate) for the treatment of primary axillary hyperhidrosis. This approval triggered a milestone payment of $10 million to Journey Medical, of which $7.5 million will be paid to Dermira, Inc. ("Dermira"), a wholly owned subsidiary of Eli Lilly and Company, pursuant to the terms of the Asset Purchase Agreement between Journey Medical and Dermira, with net proceeds of $2.5 million to Journey Medical.
In November 2021, Journey Medical completed its IPO of common stock of 3,520,000 shares at a public offering price of $10.00 per share, for net proceeds of $30.6 million, after deducting underwriting discounts and offering expenses. All of the shares of common stock were offered by Journey Medical.
In July 2021, Journey Medical completed its final private placements under the 8% Cumulative Convertible Class A Preferred Stock Offering (the "Preferred Offering"), issuing an aggregate of 758,680 preferred shares at a price of $25.00 per share, raising approximately $19.0 million in gross proceeds and, after deducting commissions, fees and expenses, receiving approximately $17.0 million in net proceeds. These shares converted into Journey Medical common stock upon the IPO.
On April 1, 2021, Journey Medical entered into an agreement with East West Bank ("EWB") in which EWB provided a $7.5 million working capital line of credit. In January 2022, Journey Medical expanded the borrowing capacity of the EWB credit agreement to $30.0 million, which includes an increase to the working capital line of credit to $10.0 million and a $20.0 million term loan.
We intend to launch an additional prescription product this year in the first half of 2022.
CUTX-101 (Copper Histidinate for Menkes disease)

In February 2021, our subsidiary Cyprium signed a Development and Asset Purchase Agreement with Sentynl Therapeutics, a wholly owned subsidiary of Zydus Lifesciences Ltd., for CUTX-101 for the treatment of Menkes disease. Under the terms of the agreement, Cyprium received $8 million upfront to fund the development of CUTX-101 and could receive up to $12 million in regulatory milestone payments related to the NDA submission and approval process and is eligible to receive sales milestones plus royalties. Royalties start from mid-single digits, scaling up to 25% on sales exceeding $100 million annually. Cyprium will retain 100% ownership over any FDA priority review voucher that may be issued at NDA approval for CUTX-101. Cyprium is responsible for the development of CUTX-101 through approval of the NDA by the FDA, and Sentynl will be responsible for commercialization of CUTX-101, as well as progressing newborn screening activities.
In October 2021, we announced positive results from an efficacy and safety analysis of data integrated from two completed pivotal studies in patients with Menkes disease treated with CUTX-101, copper histidinate (CuHis). These data were presented as a virtual poster at the 2021 American Academy of Pediatrics National Conference & Exhibition. Overall, a 79% reduction in risk of death was observed in patients treated within four weeks of birth compared with an untreated historical control cohort of patients and median overall survival (OS) was 177.1 and 16.1 months, respectively, with a hazard ratio (HR) of (95% CI) = 0.208 (0.094, 0.463) p<0.0001. A 75% reduction in the risk of death was also observed in patients treated after four weeks of birth compared with untreated historical control subjects and median OS was 62.4 and 17.6 months, respectively; HR (95% CI) = 0.253 (0.119, 0.537); p<0.0001.
In December 2021, we initiated the rolling submission of an NDA to the U.S. Food and Drug Administration ("FDA") for CUTX-101. We intend to complete the rolling submission of the NDA for CUTX-101 in mid-2022.
In March 2022, Cyprium announced positive data on CUTX-101 were presented as a "Top-Rated Abstract" and Poster at the 2022 American College of Medical Genetics and Genomics Clinical Genetics Meeting. The abstract can be viewed here.
CUTX-101 was sourced by Fortress and is currently in development at Cyprium.
CAEL-101 (Light Chain Fibril-reactive Monoclonal Antibody for AL Amyloidosis)

On October 5, 2021, AstraZeneca plc as successor-in-interest to Alexion Pharmaceuticals, Inc. ("Alexion") acquired Caelum for an upfront payment of approximately $150 million paid to Caelum shareholders, of which approximately $56.9 million was paid to Fortress, net of the $6.4 million, 24-month escrow holdback amount and other miscellaneous transaction expenses. The agreement also provides for additional potential payments to Caelum shareholders totaling up to $350 million, payable upon the achievement of regulatory and commercial milestones. Fortress is eligible to receive 42.4% of all potential milestone payments, totaling up to approximately $212 million.
There are two ongoing Phase 3 studies of CAEL-101 for AL amyloidosis. (ClinicalTrials.gov Identifiers: NCT04512235 and NCT04504825)
In December 2021, CAEL-101 data were presented at the American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting ("ASH2021"). Abstracts can be viewed online through the ASH (Free ASH Whitepaper)2021 website here.
In June 2021, Caelum announced that CAEL-101 clinical data were presented at the European Hematology Association (EHA) (Free EHA Whitepaper) 2021 Virtual Congress ("EHA2021"). The data, presented in two e-posters, demonstrates the safety and tolerability profile of CAEL-101 to further support the dose selection for the ongoing Phase 3 study, and suggest possible cardiac and renal response.
Also in June 2021, the FDA granted Fast Track designation to CAEL-101 for the treatment of light chain AL amyloidosis.
CAEL-101 was sourced by Fortress and was developed by Caelum until Caelum was acquired by AstraZeneca.
Cosibelimab (formerly CK-301, an anti-PD-L1 antibody)

In December 2021, we announced the initiation of the CONTERNO study, a global, randomized Phase 3 trial of cosibelimab in combination with pemetrexed and platinum chemotherapy for the first-line treatment of patients with non-squamous non-small cell lung cancer.
In January 2022, we announced positive topline results from our registration-enabling clinical trial evaluating the safety and efficacy of our anti-PD-L1 antibody, cosibelimab, administered as a fixed dose of 800 mg every two weeks in patients with metastatic cSCC. The study met its primary endpoint, with cosibelimab demonstrating a confirmed objective response rate of 47.4% (95% CI: 36.0, 59.1) based on independent central review of 78 patients enrolled in the metastatic cSCC cohort using Response Evaluation Criteria in Solid Tumors version 1.1 criteria. Checkpoint intends to submit a BLA for cosibelimab in 2022, followed by a Marketing Authorization Application submission in Europe and other territories worldwide. With a potentially favorable safety profile versus anti-PD-1 therapy and a plan to commercialize at a substantially lower price, we believe cosibelimab has the potential to be a market disruptive product in the $30 billion and growing PD-(L)1 class.
Cosibelimab was sourced by Fortress and is currently in development at our partner company, Checkpoint.
Olafertinib (formerly CK-101, a third-generation epidermal growth factor receptor ("EGFR") inhibitor)

During the second quarter of 2021, we had productive interactions with the FDA regarding Checkpoint’s ongoing development program for olafertinib (formerly CK-101), our third-generation EGFR inhibitor being evaluated by our partner in an ongoing double-blind, randomized Phase 3 study in China.
Olafertinib was sourced by Fortress and is currently in development at our partner company, Checkpoint.
MB-106 (CD20-targeted CAR T Cell Therapy)

In May 2021, we announced that the FDA approved Mustang Bio‘s Investigational New Drug ("IND") application to initiate a multicenter Phase 1/2 clinical trial investigating the safety and efficacy of MB-106, a CD20-targeted, autologous CAR T cell therapy for relapsed or refractory B-NHL and CLL. We intend to dose the first patient in that trial in the first half of 2022.
In June 2021, we announced that MB-106 CD20-targeted CAR T data were presented at EHA (Free EHA Whitepaper)2021. Dr. Mazyar Shadman of Fred Hutchinson Cancer Research Center presented updated interim data from the ongoing Phase 1/2 clinical trial for B-NHL and CLL, which showed a favorable safety profile and compelling clinical activity, with a 93% overall response rate and 67% complete response rate in patients treated with the modified cell manufacturing process.
Also in June 2021, we hosted a key opinion leader webinar featuring a presentation from Dr. Shadman, who discussed interim results from the ongoing Phase 1/2 clinical trial investigating the safety and efficacy of MB-106 CD20-targeted CAR T for B-NHL and CLL.
In November 2021, we announced that Mustang Bio was awarded a grant of approximately $2 million from the National Cancer Institute of the National Institutes of Health. This two-year award will partially fund the Mustang Bio-sponsored multicenter trial to assess the safety, tolerability and efficacy of MB-106, a CD20-targeted, autologous CAR T cell therapy for patients with relapsed or refractory B- NHL or CLL.
In December 2021, we announced that MB-106 data were presented at ASH (Free ASH Whitepaper)2021. Dr. Mazyar Shadman of Fred Hutchinson Cancer Research Center presented updated interim data showing a 95% overall response rate, 65% complete response rate and favorable safety profile from the ongoing Phase 1/2 clinical trial for B-NHL and CLL. A copy of the poster can be viewed online here.
Also in December 2021, we hosted a key opinion leader webinar featuring a presentation from Dr. Shadman, who discussed interim results from the ongoing Phase 1/2 clinical trial investigating the safety and efficacy of MB-106 CD20-targeted CAR T for B-NHL and CLL. A replay of the webinar can be found here.
In January 2022, we announced that interim Phase 1/2 data on MB-106, a CD20-targeted, autologous CAR T cell therapy for patients with relapsed or refractory B-cell NHL and CLL, were selected for a poster presentation at the 2022 Tandem Meetings I Transplantation & Cellular Therapy Meetings of the American Society of Transplantation and Cellular Therapy and Center for International Blood & Marrow Transplant Research, rescheduled to take place April 23-26, 2022, in Salt Lake City, Utah. A copy of the abstract can be viewed on the meeting website here.
MB-106 was sourced by Fortress and is currently in development at our partner company, Mustang Bio.
Dotinurad (Urate Transporter (URAT1) Inhibitor)

In May 2021, we announced an exclusive license agreement with Fuji Yakuhin Co. Ltd. to develop Dotinurad in North America and Europe. Dotinurad is a potential best-in-class urate transporter (URAT1) inhibitor for gout and possibly other hyperuricemic indications including chronic kidney disease (CKD) and heart failure. Dotinurad (URECE tablet) was approved in Japan in 2020 as a once-daily oral therapy for gout and hyperuricemia. Dotinurad was efficacious and well-tolerated in more than 500 Japanese patients treated for up to 58 weeks in Phase 3 clinical trials. Over 1,000 Japanese patients have been treated safely with this drug.
In December 2021, we filed an IND with the FDA. We expect to initiate a Phase 1 clinical trial to evaluate Dotinurad for the treatment of gout in the first half of 2022.
Dotinurad was sourced by Fortress and is currently in development at our subsidiary company, UR1 Therapeutics.
MB-107 and MB-207 (Lentiviral Gene Therapies for XSCID)

In February 2021, we announced encouraging MB-107 and MB-207 clinical updates from our XSCID investigator-IND trials, as well as additional consistent safety and efficacy data.
In August 2021, we announced that the European Medicines Agency ("EMA") granted Priority Medicines ("PRIME") designation to MB-107, a lentiviral gene therapy for the treatment of XSCID in newly diagnosed infants, also known as bubble boy disease.
In the second half of 2022, we expect to enroll the first patient in a pivotal multicenter Phase 2 clinical trial under Mustang Bio’s IND to evaluate MB-107, a lentiviral gene therapy for the treatment of infants under the age of two with XSCID.
Mustang Bio filed an IND application in December 2021 for its pivotal multicenter Phase 2 clinical trial of MB-207, a lentiviral gene therapy for the treatment of patients with XSCID who have been previously treated with a hematopoietic stem cell transplantation ("HSCT") and for whom re-treatment is indicated. The trial is currently on hold pending CMC clearance from the FDA, and based on feedback from the Agency, Mustang Bio expects to enroll the first patient in a pivotal multicenter Phase 2 clinical trial in the first quarter of 2023.
MB-107 and MB-207 were sourced by Fortress and are currently in development at our partner company, Mustang Bio.
Triplex (Cytomegalovirus ("CMV") vaccine)

In December 2021, we announced that a Phase 2 double-blind, randomized, placebo-controlled clinical trial was initiated to evaluate the safety and efficacy of Triplex, a cytomegalovirus ("CMV") vaccine, in eliciting a CMV-specific immune response and reducing CMV replication in people living with HIV. The trial is being conducted by the AIDS Clinical Trials Group and is funded by the National Institute of Allergy and Infectious Disease, part of the National Institutes of Health.
Triplex was sourced by Fortress and is currently in development at our subsidiary company, Helocyte, Inc.
MB-101 (IL13Rα2-targeted CAR T Cell Therapy)

In May 2021, we announced that the first patient was dosed at City of Hope in a clinical trial to establish the safety and feasibility of administering MB-101 (autologous IL13Rα2-directed CAR T cells) to patients with leptomeningeal brain tumors (e.g., glioblastoma, ependymoma or medulloblastoma).
In October 2021, Christine Brown, Ph.D., Deputy Director, T Cell Therapeutics Research Laboratory Professor, Departments of Hematology & Hematopoietic Cell Transplantation and Immuno-Oncology and The Heritage Provider Network Professor in Immunotherapy at City of Hope, presented updated Phase 1 clinical data regarding MB-101 (IL13Rα2‐targeted CAR T cells) for the treatment of glioblastoma at two scientific conferences, the First Annual Conference on CNS Clinical Trials, co-sponsored by the Society for Neuro-Oncology and American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper), and the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Virtual Special Conference: Brain Cancer.
MB-101 was sourced by Fortress and is currently in development at our partner company, Mustang Bio.
MB-105 (PSCA-targeted CAR T Cell Therapy)

In February 2022, Phase 1 data on MB-105, a PSCA-targeted CAR T cell therapy administered systemically to patients with PSCA-positive metastatic castration-resistant prostate cancer ("mCRPC"), were presented by City of Hope at the 2022 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Genitourinary Cancers Symposium. The data results indicated that PSCA-CAR T-cell therapy is feasible in patients with mCRPC with dose limiting toxicity of cystitis and show preliminary anti-tumor effect at a dose of 100 million cells plus lymphodepletion. It was concluded that escalation up to the next dose level of 300 million cells can proceed in the trial.
MB-105 was sourced by Fortress and is currently in development at our partner company, Mustang Bio.
MB-109 (MB-101 (IL13Rα2-targeted CAR T Cell Therapy) + MB-108 oncolytic virus)

In March 2022, we announced that an abstract reporting on Phase 1 trials being conducted at the University of Alabama at Birmingham (UAB) and City of Hope of Mustang Bio’s exclusively licensed oncolytic viral and CAR T-cell therapies for the treatment of patients with glioblastoma (GBM) was selected as a late-breaking poster presentation at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting 2022, taking place April 8 – 13, 2022, in New Orleans, Louisiana. The abstract will also be published in the online Proceedings of the AACR (Free AACR Whitepaper).
Novel CAR T Technology

In August 2021, we announced an exclusive license agreement with Mayo Clinic for a novel technology to create in vivo CAR T cells that may be able to transform the administration of CAR T therapies and has the potential to be used as an off-the-shelf therapy.
The novel CAR T technology was sourced by Fortress and is currently in development at our partner company, Mustang Bio.
Ex Vivo Lentiviral Gene Therapy for RAG1 Severe Combined Immunodeficiency ("RAG1-SCID")

In November 2021, we announced the execution of an exclusive license agreement with Leiden University Medical Centre for a first-in-class ex vivo lentiviral gene therapy for the treatment of RAG1-SCID.
The ex vivo lentiviral gene therapy was sourced by Fortress and is currently in development at Mustang Bio.
Financial Results:

To assist our stockholders in understanding our company, we have prepared non-GAAP financial results for the three months and twelve months ended December 31, 2021 and 2020. These results exclude the operations of our four public partner companies: Avenue Therapeutics, Inc. ("Avenue"), Checkpoint, Journey Medical and Mustang Bio, as well as any one-time, non-recurring, non-cash transactions. The goal in providing these non-GAAP financial metrics is to highlight the financial results of Fortress’ core operations, which are comprised of our privately held development-stage entities, as well as our business development and finance functions.

As of December 31, 2021, Fortress’ consolidated cash, cash equivalents and restricted cash totaled $308.0 million, compared to $254.4 million as of September 30, 2021, and $235.0 million as of December 31, 2020, an increase of $53.6 million for the fourth quarter and an increase of $73.0 million for the full year.
On a GAAP basis, Fortress’ net revenue totaled $68.8 million for the full year ended December 31, 2021, which included $63.1 million in net revenue generated from our marketed dermatology products. This compares to net revenue totaling $45.6 million for the full year ended 2020, which included $44.5 million in net revenue generated from our marketed dermatology products.
On a GAAP basis, consolidated research and development expenses including license acquisitions totaled $128.9 million for the full year ended December 31, 2021, compared to $64.1 million for the full year ended December 31, 2020. On a non-GAAP basis, research and development costs including research and development license acquisitions totaled $18.0 million for the full year ended December 31, 2021, compared to $10.0 million for the full year ended December 31, 2020.
On a GAAP basis, consolidated selling, general and administrative costs were $86.8 million for the full year ended December 31, 2021, compared to $61.2 million for the full year ended December 31, 2020. On a non-GAAP basis, selling, general and administrative expenses were $28.6 million for the full year ended December 31, 2021, compared to $23.4 for the full year ended December 31, 2020.
On a GAAP basis, consolidated net loss attributable to common stockholders was $(64.7) million, or $(0.79) per share, for the full year ended December 31, 2021, compared to net loss attributable to common stockholders of $(46.5) million, or $(0.65) per share for the full year ended December 31, 2020.
Fortress’ non-GAAP income attributable to common stockholders was $25.5 million, or $0.31 per share basic and $0.25 per share diluted, for the full year ended December 31, 2021, compared to Fortress’ non-GAAP loss attributable to common stockholders of $(30.8) million, or $(0.43) per share basic and diluted, for the full year ended December 31, 2020.
Use of Non-GAAP Measures:
In addition to the GAAP financial measures as presented in our Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 28, 2022, the Company, in this press release, has included certain non-GAAP measurements. The non-GAAP net loss attributable to common stockholders is defined by the Company as GAAP net loss attributable to common stockholders, less net losses attributable to common stockholders from our public partner companies Avenue, Checkpoint, Journey Medical and Mustang Bio ("public partner companies"), as well as our former subsidiary, Caelum. In addition, the Company has also provided a Fortress non-GAAP loss attributable to common stockholders which is a modified EBITDA calculation that starts with the non-GAAP loss attributable to common stockholders and removes stock-based compensation expense, non-cash interest expense, amortization of licenses and debt discount, changes in fair values of investment, changes in fair value of derivative liability, and depreciation expense. The Company also provides non-GAAP research and development costs, defined as GAAP research and development costs, less research and development costs of our public partner companies and non-GAAP selling, general and administrative costs, defined as GAAP selling, general and administrative costs, less selling, general and administrative costs of our public partner companies.

Management believes each of these non-GAAP measures provide meaningful supplemental information regarding the Company’s performance because (i) it allows for greater transparency with respect to key measures used by management in its financial and operational decision-making; (ii) it excludes the impact of non-cash or, when specified, non-recurring items that are not directly attributable to the Company’s core operating performance and that may obscure trends in the Company’s core operating performance; and (iii) it is used by institutional investors and the analyst community to help analyze the Company’s standalone results separate from the results of its public partner companies. However, non-GAAP loss attributable to common stockholders and any other non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Further, non-GAAP financial measures used by the Company and the manner in which they are calculated may differ from the non-GAAP financial measures or the calculations of the same non-GAAP financial measures used by other companies, including the Company’s competitors.

Results for the year ended December 31, 2020 have been adjusted to remove Journey Medical as a public entity due to its IPO in November, 2021.
Avenue net loss for the years ended December 31, 2021 and 2020 of $3.7 million and $5.2 million, respectively, net of non-controlling interest of $2.9 million and $4.0 million, respectively.
Checkpoint net loss for the year ended December 31, 2021 of $56.7 million net of non-controlling interest of $39.2 million, Master Services Agreement ("MSA") fee to Fortress of $0.5 million, financing fee and payment-in-kind ("PIK") dividend to Fortress of $1.0 million and $6.6 million, respectively; and net loss for the year ended December 31, 2020 of $23.1 million net of non-controlling interest of $13.3 million, MSA fee to Fortress of $0.5 million, financing fee and PIK dividend to Fortress of $0.9 million and $4.6 million, respectively.
Journey Medical net loss for the year ended December 31, 2021 of $44.0 million net of non-controlling interest of $5.7 million and tax expense recognized on a stand-alone basis of $1.6 million; and net income for the year ended December 31, 2020 of $5.3 million, net non-controlling interest of $0.5 million and stand-alone tax expense of $1.9 million.
Mustang net loss of $66.4 million net of non-controlling interest of $48.5 million, MSA fee to Fortress of $0.5 million and financing fee and PIK dividend to Fortress of $1.9 million and $4.2 million, respectively, for the year ended December 31, 2021; and net loss of $60.0 million net of non-controlling interest of $36.4 million, MSA fee to Fortress of $0.5 million and financing fee and PIK dividend to Fortress of $2.4 million and $7.6 million, respectively, for the year ended December 31, 2020.
Proceeds received from AstraZeneca plc acquisition of Caelum Biosciences, Inc. in October 2021.Includes Research and development expense and Research and development – licenses acquired expense for the years ended December 31, 2021 and 2020, respectively.
Excludes $6.6 million and $4.6 million of PIK dividend payable to Fortress for the year ended December 31, 2021 and 2020, respectively.
Excludes $0.3 million of Fortress MSA expense and $4.2 million PIK dividend payable to Fortress for the year ended December 31, 2021; and excludes $0.3 million of Fortress MSA expense and $7.6 million PIK dividend payable to Fortress for the year ended December 31, 2020.
Includes Selling, general and administrative expenses and wire transfer fraud loss for the year ended December 31, 2021.
Excludes $0.5 million of Fortress MSA expense and $1.0 million Fortress financing fee for the year ended December 31, 2021; and $0.5 million of Fortress MSA expense and $0.9 million Fortress financing fee for the year ended December 31, 2020.
Excludes $0.3 million of Fortress MSA expense and $1.9 million Fortress financing fee for the year ended December 31, 2021; and $0.3 million of Fortress MSA expense and $2.4 million Fortress financing fee for the year ended December 31, 2020.

On March 28, 2022 Fortress Biotech, Inc. (NASDAQ: FBIO) ("Fortress"), an innovative biopharmaceutical company focused on efficiently acquiring, developing and commercializing or monetizing promising therapeutic products and product candidates, reported financial results and recent corporate highlights for the full-year ended December 31, 2021 (Press release, Fortress Biotech, MAR 28, 2022, View Source [SID1234611064]).

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Lindsay A. Rosenwald, M.D., Fortress’ Chairman, President and Chief Executive Officer, said, "Fortress and its partner companies had an exceptional year in 2021, generating a record-setting annual net revenue of $68.8 million, representing more than 50% growth over 2020. We also began to realize the value of our monetization strategy when AstraZeneca acquired Caelum Biosciences ("Caelum"), a company founded by Fortress, during the fourth quarter of 2021, when we received a $56.9 million payment for our investment in Caelum. Fortress has the potential to receive up to an additional approximately $155 million in future milestone payments from the transaction, which includes proceeds from the release of escrow funds. Our subsidiary Cyprium Therapeutics ("Cyprium") executed an agreement with Sentynl Therapeutics to commit development funding for and contingently acquire Cyprium’s proprietary rights to CUTX-101, its Copper Histidinate product candidate for the treatment of Menkes disease, upon FDA approval. Also of note, Journey Medical Corporation ("Journey Medical") completed its $30.6 million initial public offering ("IPO"), net of discounts and other offering costs, launched Accutane (isotretinoin), acquired Qbrexza (glycopyrronium) from Dermira, Inc. and entered into a collaboration agreement with Dr. Reddy’s Laboratories Ltd. to develop and commercialize DFD-29 (minocycline modified release capsules 40 mg) for the treatment of rosacea."

Dr. Rosenwald continued, "Looking ahead in 2022, we anticipate continued progress and growth from our nine marketed prescription pharmaceutical products and over 30 product candidates in development. We have 30 ongoing clinical trials, including four product candidates in seven2 ongoing pivotal clinical trials. We expect the rolling submission of the New Drug Application ("NDA") for CUTX-101 to be complete in mid-2022. After announcing positive top-line results from the registration-enabling study of cosibelimab in metastatic cutaneous squamous cell carcinoma ("cSCC") in January, our partner company Checkpoint Therapeutics, Inc. ("Checkpoint") intends to submit a Biologics License Application ("BLA") for cosibelimab in 2022, followed thereafter by a Marketing Authorization Application submission in Europe. Mustang Bio, Inc. ("Mustang Bio"), another one of our partner companies, plans to initiate a multicenter Phase 1/2 clinical trial investigating the safety and efficacy of MB-106, a CD20-targeted, autologous CAR T cell therapy for relapsed or refractory B-cell non-Hodgkin lymphomas ("B-NHL") and chronic lymphocytic leukemia ("CLL") in the first half of 2022. Mustang Bio also plans to enroll the first patient in a pivotal multicenter Phase 2 clinical trial to evaluate MB-107, a lentiviral gene therapy for the treatment of infants under the age of two with X-linked severe combined immunodeficiency ("XSCID") in the second half of 2022. This ongoing advancement showcases the ability of Fortress’ business model to generate value for our shareholders and develop innovative therapies to help patients with unmet needs across multiple disease areas."

2021 and Recent Corporate Highlights3:

Marketed Dermatology Products and Product Candidates

Journey Medical currently has nine prescription dermatology products. In 2021 and early 2022, Journey Medical acquired and launched four prescription dermatology products including Accutane, Qbrexza, Amzeeq and Zilxi, and two product candidates, DFD-29 and FCD105.
Our products generated net revenues of $63.1 million for full-year 2021, compared to full-year 2020 net revenues of $44.5 million, representing growth of 42%.
In March 2022, Journey Medical dosed the first patient in the Phase 3 clinical program of DFD-29 for the treatment of papulopustular rosacea. Topline data is anticipated in the first quarter of 2023 with an NDA filing expected in the second half of 2023.
In February 2022, Journey Medical received notice from its exclusive licensing partner in Japan, Maruho Co., Ltd. ("Maruho"), that Japan’s Ministry of Health, Labor and Welfare ("MHLW") approved Rapifort Wipes 2.5% (glycopyrronium tosylate hydrate) for the treatment of primary axillary hyperhidrosis. This approval triggered a milestone payment of $10 million to Journey Medical, of which $7.5 million will be paid to Dermira, Inc. ("Dermira"), a wholly owned subsidiary of Eli Lilly and Company, pursuant to the terms of the Asset Purchase Agreement between Journey Medical and Dermira, with net proceeds of $2.5 million to Journey Medical.
In November 2021, Journey Medical completed its IPO of common stock of 3,520,000 shares at a public offering price of $10.00 per share, for net proceeds of $30.6 million, after deducting underwriting discounts and offering expenses. All of the shares of common stock were offered by Journey Medical.
In July 2021, Journey Medical completed its final private placements under the 8% Cumulative Convertible Class A Preferred Stock Offering (the "Preferred Offering"), issuing an aggregate of 758,680 preferred shares at a price of $25.00 per share, raising approximately $19.0 million in gross proceeds and, after deducting commissions, fees and expenses, receiving approximately $17.0 million in net proceeds. These shares converted into Journey Medical common stock upon the IPO.
On April 1, 2021, Journey Medical entered into an agreement with East West Bank ("EWB") in which EWB provided a $7.5 million working capital line of credit. In January 2022, Journey Medical expanded the borrowing capacity of the EWB credit agreement to $30.0 million, which includes an increase to the working capital line of credit to $10.0 million and a $20.0 million term loan.
We intend to launch an additional prescription product this year in the first half of 2022.
CUTX-101 (Copper Histidinate for Menkes disease)

In February 2021, our subsidiary Cyprium signed a Development and Asset Purchase Agreement with Sentynl Therapeutics, a wholly owned subsidiary of Zydus Lifesciences Ltd., for CUTX-101 for the treatment of Menkes disease. Under the terms of the agreement, Cyprium received $8 million upfront to fund the development of CUTX-101 and could receive up to $12 million in regulatory milestone payments related to the NDA submission and approval process and is eligible to receive sales milestones plus royalties. Royalties start from mid-single digits, scaling up to 25% on sales exceeding $100 million annually. Cyprium will retain 100% ownership over any FDA priority review voucher that may be issued at NDA approval for CUTX-101. Cyprium is responsible for the development of CUTX-101 through approval of the NDA by the FDA, and Sentynl will be responsible for commercialization of CUTX-101, as well as progressing newborn screening activities.
In October 2021, we announced positive results from an efficacy and safety analysis of data integrated from two completed pivotal studies in patients with Menkes disease treated with CUTX-101, copper histidinate (CuHis). These data were presented as a virtual poster at the 2021 American Academy of Pediatrics National Conference & Exhibition. Overall, a 79% reduction in risk of death was observed in patients treated within four weeks of birth compared with an untreated historical control cohort of patients and median overall survival (OS) was 177.1 and 16.1 months, respectively, with a hazard ratio (HR) of (95% CI) = 0.208 (0.094, 0.463) p<0.0001. A 75% reduction in the risk of death was also observed in patients treated after four weeks of birth compared with untreated historical control subjects and median OS was 62.4 and 17.6 months, respectively; HR (95% CI) = 0.253 (0.119, 0.537); p<0.0001.
In December 2021, we initiated the rolling submission of an NDA to the U.S. Food and Drug Administration ("FDA") for CUTX-101. We intend to complete the rolling submission of the NDA for CUTX-101 in mid-2022.
In March 2022, Cyprium announced positive data on CUTX-101 were presented as a "Top-Rated Abstract" and Poster at the 2022 American College of Medical Genetics and Genomics Clinical Genetics Meeting. The abstract can be viewed here.
CUTX-101 was sourced by Fortress and is currently in development at Cyprium.
CAEL-101 (Light Chain Fibril-reactive Monoclonal Antibody for AL Amyloidosis)

On October 5, 2021, AstraZeneca plc as successor-in-interest to Alexion Pharmaceuticals, Inc. ("Alexion") acquired Caelum for an upfront payment of approximately $150 million paid to Caelum shareholders, of which approximately $56.9 million was paid to Fortress, net of the $6.4 million, 24-month escrow holdback amount and other miscellaneous transaction expenses. The agreement also provides for additional potential payments to Caelum shareholders totaling up to $350 million, payable upon the achievement of regulatory and commercial milestones. Fortress is eligible to receive 42.4% of all potential milestone payments, totaling up to approximately $212 million.
There are two ongoing Phase 3 studies of CAEL-101 for AL amyloidosis. (ClinicalTrials.gov Identifiers: NCT04512235 and NCT04504825)
In December 2021, CAEL-101 data were presented at the American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting ("ASH2021"). Abstracts can be viewed online through the ASH (Free ASH Whitepaper)2021 website here.
In June 2021, Caelum announced that CAEL-101 clinical data were presented at the European Hematology Association (EHA) (Free EHA Whitepaper) 2021 Virtual Congress ("EHA2021"). The data, presented in two e-posters, demonstrates the safety and tolerability profile of CAEL-101 to further support the dose selection for the ongoing Phase 3 study, and suggest possible cardiac and renal response.
Also in June 2021, the FDA granted Fast Track designation to CAEL-101 for the treatment of light chain AL amyloidosis.
CAEL-101 was sourced by Fortress and was developed by Caelum until Caelum was acquired by AstraZeneca.
Cosibelimab (formerly CK-301, an anti-PD-L1 antibody)

In December 2021, we announced the initiation of the CONTERNO study, a global, randomized Phase 3 trial of cosibelimab in combination with pemetrexed and platinum chemotherapy for the first-line treatment of patients with non-squamous non-small cell lung cancer.
In January 2022, we announced positive topline results from our registration-enabling clinical trial evaluating the safety and efficacy of our anti-PD-L1 antibody, cosibelimab, administered as a fixed dose of 800 mg every two weeks in patients with metastatic cSCC. The study met its primary endpoint, with cosibelimab demonstrating a confirmed objective response rate of 47.4% (95% CI: 36.0, 59.1) based on independent central review of 78 patients enrolled in the metastatic cSCC cohort using Response Evaluation Criteria in Solid Tumors version 1.1 criteria. Checkpoint intends to submit a BLA for cosibelimab in 2022, followed by a Marketing Authorization Application submission in Europe and other territories worldwide. With a potentially favorable safety profile versus anti-PD-1 therapy and a plan to commercialize at a substantially lower price, we believe cosibelimab has the potential to be a market disruptive product in the $30 billion and growing PD-(L)1 class.
Cosibelimab was sourced by Fortress and is currently in development at our partner company, Checkpoint.
Olafertinib (formerly CK-101, a third-generation epidermal growth factor receptor ("EGFR") inhibitor)

During the second quarter of 2021, we had productive interactions with the FDA regarding Checkpoint’s ongoing development program for olafertinib (formerly CK-101), our third-generation EGFR inhibitor being evaluated by our partner in an ongoing double-blind, randomized Phase 3 study in China.
Olafertinib was sourced by Fortress and is currently in development at our partner company, Checkpoint.
MB-106 (CD20-targeted CAR T Cell Therapy)

In May 2021, we announced that the FDA approved Mustang Bio‘s Investigational New Drug ("IND") application to initiate a multicenter Phase 1/2 clinical trial investigating the safety and efficacy of MB-106, a CD20-targeted, autologous CAR T cell therapy for relapsed or refractory B-NHL and CLL. We intend to dose the first patient in that trial in the first half of 2022.
In June 2021, we announced that MB-106 CD20-targeted CAR T data were presented at EHA (Free EHA Whitepaper)2021. Dr. Mazyar Shadman of Fred Hutchinson Cancer Research Center presented updated interim data from the ongoing Phase 1/2 clinical trial for B-NHL and CLL, which showed a favorable safety profile and compelling clinical activity, with a 93% overall response rate and 67% complete response rate in patients treated with the modified cell manufacturing process.
Also in June 2021, we hosted a key opinion leader webinar featuring a presentation from Dr. Shadman, who discussed interim results from the ongoing Phase 1/2 clinical trial investigating the safety and efficacy of MB-106 CD20-targeted CAR T for B-NHL and CLL.
In November 2021, we announced that Mustang Bio was awarded a grant of approximately $2 million from the National Cancer Institute of the National Institutes of Health. This two-year award will partially fund the Mustang Bio-sponsored multicenter trial to assess the safety, tolerability and efficacy of MB-106, a CD20-targeted, autologous CAR T cell therapy for patients with relapsed or refractory B- NHL or CLL.
In December 2021, we announced that MB-106 data were presented at ASH (Free ASH Whitepaper)2021. Dr. Mazyar Shadman of Fred Hutchinson Cancer Research Center presented updated interim data showing a 95% overall response rate, 65% complete response rate and favorable safety profile from the ongoing Phase 1/2 clinical trial for B-NHL and CLL. A copy of the poster can be viewed online here.
Also in December 2021, we hosted a key opinion leader webinar featuring a presentation from Dr. Shadman, who discussed interim results from the ongoing Phase 1/2 clinical trial investigating the safety and efficacy of MB-106 CD20-targeted CAR T for B-NHL and CLL. A replay of the webinar can be found here.
In January 2022, we announced that interim Phase 1/2 data on MB-106, a CD20-targeted, autologous CAR T cell therapy for patients with relapsed or refractory B-cell NHL and CLL, were selected for a poster presentation at the 2022 Tandem Meetings I Transplantation & Cellular Therapy Meetings of the American Society of Transplantation and Cellular Therapy and Center for International Blood & Marrow Transplant Research, rescheduled to take place April 23-26, 2022, in Salt Lake City, Utah. A copy of the abstract can be viewed on the meeting website here.
MB-106 was sourced by Fortress and is currently in development at our partner company, Mustang Bio.
Dotinurad (Urate Transporter (URAT1) Inhibitor)

In May 2021, we announced an exclusive license agreement with Fuji Yakuhin Co. Ltd. to develop Dotinurad in North America and Europe. Dotinurad is a potential best-in-class urate transporter (URAT1) inhibitor for gout and possibly other hyperuricemic indications including chronic kidney disease (CKD) and heart failure. Dotinurad (URECE tablet) was approved in Japan in 2020 as a once-daily oral therapy for gout and hyperuricemia. Dotinurad was efficacious and well-tolerated in more than 500 Japanese patients treated for up to 58 weeks in Phase 3 clinical trials. Over 1,000 Japanese patients have been treated safely with this drug.
In December 2021, we filed an IND with the FDA. We expect to initiate a Phase 1 clinical trial to evaluate Dotinurad for the treatment of gout in the first half of 2022.
Dotinurad was sourced by Fortress and is currently in development at our subsidiary company, UR1 Therapeutics.
MB-107 and MB-207 (Lentiviral Gene Therapies for XSCID)

In February 2021, we announced encouraging MB-107 and MB-207 clinical updates from our XSCID investigator-IND trials, as well as additional consistent safety and efficacy data.
In August 2021, we announced that the European Medicines Agency ("EMA") granted Priority Medicines ("PRIME") designation to MB-107, a lentiviral gene therapy for the treatment of XSCID in newly diagnosed infants, also known as bubble boy disease.
In the second half of 2022, we expect to enroll the first patient in a pivotal multicenter Phase 2 clinical trial under Mustang Bio’s IND to evaluate MB-107, a lentiviral gene therapy for the treatment of infants under the age of two with XSCID.
Mustang Bio filed an IND application in December 2021 for its pivotal multicenter Phase 2 clinical trial of MB-207, a lentiviral gene therapy for the treatment of patients with XSCID who have been previously treated with a hematopoietic stem cell transplantation ("HSCT") and for whom re-treatment is indicated. The trial is currently on hold pending CMC clearance from the FDA, and based on feedback from the Agency, Mustang Bio expects to enroll the first patient in a pivotal multicenter Phase 2 clinical trial in the first quarter of 2023.
MB-107 and MB-207 were sourced by Fortress and are currently in development at our partner company, Mustang Bio.
Triplex (Cytomegalovirus ("CMV") vaccine)

In December 2021, we announced that a Phase 2 double-blind, randomized, placebo-controlled clinical trial was initiated to evaluate the safety and efficacy of Triplex, a cytomegalovirus ("CMV") vaccine, in eliciting a CMV-specific immune response and reducing CMV replication in people living with HIV. The trial is being conducted by the AIDS Clinical Trials Group and is funded by the National Institute of Allergy and Infectious Disease, part of the National Institutes of Health.
Triplex was sourced by Fortress and is currently in development at our subsidiary company, Helocyte, Inc.
MB-101 (IL13Rα2-targeted CAR T Cell Therapy)

In May 2021, we announced that the first patient was dosed at City of Hope in a clinical trial to establish the safety and feasibility of administering MB-101 (autologous IL13Rα2-directed CAR T cells) to patients with leptomeningeal brain tumors (e.g., glioblastoma, ependymoma or medulloblastoma).
In October 2021, Christine Brown, Ph.D., Deputy Director, T Cell Therapeutics Research Laboratory Professor, Departments of Hematology & Hematopoietic Cell Transplantation and Immuno-Oncology and The Heritage Provider Network Professor in Immunotherapy at City of Hope, presented updated Phase 1 clinical data regarding MB-101 (IL13Rα2‐targeted CAR T cells) for the treatment of glioblastoma at two scientific conferences, the First Annual Conference on CNS Clinical Trials, co-sponsored by the Society for Neuro-Oncology and American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper), and the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Virtual Special Conference: Brain Cancer.
MB-101 was sourced by Fortress and is currently in development at our partner company, Mustang Bio.
MB-105 (PSCA-targeted CAR T Cell Therapy)

In February 2022, Phase 1 data on MB-105, a PSCA-targeted CAR T cell therapy administered systemically to patients with PSCA-positive metastatic castration-resistant prostate cancer ("mCRPC"), were presented by City of Hope at the 2022 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Genitourinary Cancers Symposium. The data results indicated that PSCA-CAR T-cell therapy is feasible in patients with mCRPC with dose limiting toxicity of cystitis and show preliminary anti-tumor effect at a dose of 100 million cells plus lymphodepletion. It was concluded that escalation up to the next dose level of 300 million cells can proceed in the trial.
MB-105 was sourced by Fortress and is currently in development at our partner company, Mustang Bio.
MB-109 (MB-101 (IL13Rα2-targeted CAR T Cell Therapy) + MB-108 oncolytic virus)

In March 2022, we announced that an abstract reporting on Phase 1 trials being conducted at the University of Alabama at Birmingham (UAB) and City of Hope of Mustang Bio’s exclusively licensed oncolytic viral and CAR T-cell therapies for the treatment of patients with glioblastoma (GBM) was selected as a late-breaking poster presentation at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting 2022, taking place April 8 – 13, 2022, in New Orleans, Louisiana. The abstract will also be published in the online Proceedings of the AACR (Free AACR Whitepaper).
Novel CAR T Technology

In August 2021, we announced an exclusive license agreement with Mayo Clinic for a novel technology to create in vivo CAR T cells that may be able to transform the administration of CAR T therapies and has the potential to be used as an off-the-shelf therapy.
The novel CAR T technology was sourced by Fortress and is currently in development at our partner company, Mustang Bio.
Ex Vivo Lentiviral Gene Therapy for RAG1 Severe Combined Immunodeficiency ("RAG1-SCID")

In November 2021, we announced the execution of an exclusive license agreement with Leiden University Medical Centre for a first-in-class ex vivo lentiviral gene therapy for the treatment of RAG1-SCID.
The ex vivo lentiviral gene therapy was sourced by Fortress and is currently in development at Mustang Bio.
Financial Results:

To assist our stockholders in understanding our company, we have prepared non-GAAP financial results for the three months and twelve months ended December 31, 2021 and 2020. These results exclude the operations of our four public partner companies: Avenue Therapeutics, Inc. ("Avenue"), Checkpoint, Journey Medical and Mustang Bio, as well as any one-time, non-recurring, non-cash transactions. The goal in providing these non-GAAP financial metrics is to highlight the financial results of Fortress’ core operations, which are comprised of our privately held development-stage entities, as well as our business development and finance functions.

As of December 31, 2021, Fortress’ consolidated cash, cash equivalents and restricted cash totaled $308.0 million, compared to $254.4 million as of September 30, 2021, and $235.0 million as of December 31, 2020, an increase of $53.6 million for the fourth quarter and an increase of $73.0 million for the full year.
On a GAAP basis, Fortress’ net revenue totaled $68.8 million for the full year ended December 31, 2021, which included $63.1 million in net revenue generated from our marketed dermatology products. This compares to net revenue totaling $45.6 million for the full year ended 2020, which included $44.5 million in net revenue generated from our marketed dermatology products.
On a GAAP basis, consolidated research and development expenses including license acquisitions totaled $128.9 million for the full year ended December 31, 2021, compared to $64.1 million for the full year ended December 31, 2020. On a non-GAAP basis, research and development costs including research and development license acquisitions totaled $18.0 million for the full year ended December 31, 2021, compared to $10.0 million for the full year ended December 31, 2020.
On a GAAP basis, consolidated selling, general and administrative costs were $86.8 million for the full year ended December 31, 2021, compared to $61.2 million for the full year ended December 31, 2020. On a non-GAAP basis, selling, general and administrative expenses were $28.6 million for the full year ended December 31, 2021, compared to $23.4 for the full year ended December 31, 2020.
On a GAAP basis, consolidated net loss attributable to common stockholders was $(64.7) million, or $(0.79) per share, for the full year ended December 31, 2021, compared to net loss attributable to common stockholders of $(46.5) million, or $(0.65) per share for the full year ended December 31, 2020.
Fortress’ non-GAAP income attributable to common stockholders was $25.5 million, or $0.31 per share basic and $0.25 per share diluted, for the full year ended December 31, 2021, compared to Fortress’ non-GAAP loss attributable to common stockholders of $(30.8) million, or $(0.43) per share basic and diluted, for the full year ended December 31, 2020.
Use of Non-GAAP Measures:
In addition to the GAAP financial measures as presented in our Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 28, 2022, the Company, in this press release, has included certain non-GAAP measurements. The non-GAAP net loss attributable to common stockholders is defined by the Company as GAAP net loss attributable to common stockholders, less net losses attributable to common stockholders from our public partner companies Avenue, Checkpoint, Journey Medical and Mustang Bio ("public partner companies"), as well as our former subsidiary, Caelum. In addition, the Company has also provided a Fortress non-GAAP loss attributable to common stockholders which is a modified EBITDA calculation that starts with the non-GAAP loss attributable to common stockholders and removes stock-based compensation expense, non-cash interest expense, amortization of licenses and debt discount, changes in fair values of investment, changes in fair value of derivative liability, and depreciation expense. The Company also provides non-GAAP research and development costs, defined as GAAP research and development costs, less research and development costs of our public partner companies and non-GAAP selling, general and administrative costs, defined as GAAP selling, general and administrative costs, less selling, general and administrative costs of our public partner companies.

Management believes each of these non-GAAP measures provide meaningful supplemental information regarding the Company’s performance because (i) it allows for greater transparency with respect to key measures used by management in its financial and operational decision-making; (ii) it excludes the impact of non-cash or, when specified, non-recurring items that are not directly attributable to the Company’s core operating performance and that may obscure trends in the Company’s core operating performance; and (iii) it is used by institutional investors and the analyst community to help analyze the Company’s standalone results separate from the results of its public partner companies. However, non-GAAP loss attributable to common stockholders and any other non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. Further, non-GAAP financial measures used by the Company and the manner in which they are calculated may differ from the non-GAAP financial measures or the calculations of the same non-GAAP financial measures used by other companies, including the Company’s competitors.

Results for the year ended December 31, 2020 have been adjusted to remove Journey Medical as a public entity due to its IPO in November, 2021.
Avenue net loss for the years ended December 31, 2021 and 2020 of $3.7 million and $5.2 million, respectively, net of non-controlling interest of $2.9 million and $4.0 million, respectively.
Checkpoint net loss for the year ended December 31, 2021 of $56.7 million net of non-controlling interest of $39.2 million, Master Services Agreement ("MSA") fee to Fortress of $0.5 million, financing fee and payment-in-kind ("PIK") dividend to Fortress of $1.0 million and $6.6 million, respectively; and net loss for the year ended December 31, 2020 of $23.1 million net of non-controlling interest of $13.3 million, MSA fee to Fortress of $0.5 million, financing fee and PIK dividend to Fortress of $0.9 million and $4.6 million, respectively.
Journey Medical net loss for the year ended December 31, 2021 of $44.0 million net of non-controlling interest of $5.7 million and tax expense recognized on a stand-alone basis of $1.6 million; and net income for the year ended December 31, 2020 of $5.3 million, net non-controlling interest of $0.5 million and stand-alone tax expense of $1.9 million.
Mustang net loss of $66.4 million net of non-controlling interest of $48.5 million, MSA fee to Fortress of $0.5 million and financing fee and PIK dividend to Fortress of $1.9 million and $4.2 million, respectively, for the year ended December 31, 2021; and net loss of $60.0 million net of non-controlling interest of $36.4 million, MSA fee to Fortress of $0.5 million and financing fee and PIK dividend to Fortress of $2.4 million and $7.6 million, respectively, for the year ended December 31, 2020.
Proceeds received from AstraZeneca plc acquisition of Caelum Biosciences, Inc. in October 2021.Includes Research and development expense and Research and development – licenses acquired expense for the years ended December 31, 2021 and 2020, respectively.
Excludes $6.6 million and $4.6 million of PIK dividend payable to Fortress for the year ended December 31, 2021 and 2020, respectively.
Excludes $0.3 million of Fortress MSA expense and $4.2 million PIK dividend payable to Fortress for the year ended December 31, 2021; and excludes $0.3 million of Fortress MSA expense and $7.6 million PIK dividend payable to Fortress for the year ended December 31, 2020.
Includes Selling, general and administrative expenses and wire transfer fraud loss for the year ended December 31, 2021.
Excludes $0.5 million of Fortress MSA expense and $1.0 million Fortress financing fee for the year ended December 31, 2021; and $0.5 million of Fortress MSA expense and $0.9 million Fortress financing fee for the year ended December 31, 2020.
Excludes $0.3 million of Fortress MSA expense and $1.9 million Fortress financing fee for the year ended December 31, 2021; and $0.3 million of Fortress MSA expense and $2.4 million Fortress financing fee for the year ended December 31, 2020.

On March 28, 2022 Verastem Oncology (Nasdaq: VSTM), a biopharmaceutical company committed to advancing new medicines for patients with cancer, reported financial results for the three months and full year ended December 31, 2021, and highlighted recent progress (Press release, Verastem, MAR 28, 2022, View Source [SID1234611063]).

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"We anticipate a catalyst-driven year and are well-positioned to maximize the potential of VS-6766 as a backbone therapy across RAS pathway-driven solid tumors in order to bring new solutions to patients in areas of high unmet need. Our recent debt facility adds flexibility to our financial strength and is expected to support the continued development and potential commercial launches of VS-6766 and defactinib, including building on our breakthrough therapy designation in low-grade serous ovarian cancer," said Brian Stuglik, Chief Executive Officer of Verastem Oncology. "We plan to report results from the selection phase of RAMP 201, our lead program in patients with low-grade serous ovarian cancer, regardless of KRAS status, during the second quarter. And, as part of our non-small cell lung cancer program, we are targeting KRAS mutant patient subpopulations across four clinical trials and we are anticipating initial readouts from three NSCLC studies, including RAMP 202 with defactinib, the investigator-sponsored study with everolimus, and RAMP 203 with LUMAKRASTM (sotorasib) this year."

Fourth Quarter 2021 and Recent Highlights

Verastem’s lead drug candidate VS-6766 is a RAF/MEK clamp that induces inactive complexes of MEK with ARAF, BRAF and CRAF, potentially creating a more complete and durable anti-tumor response through maximal RAS pathway inhibition.

Low Grade Serous Ovarian Cancer (LGSOC)

Planned enrollment is complete in the selection phase (Part A; n=64) of the registration-directed Phase 2 RAMP 201 study investigating VS-6766 alone or in combination with defactinib for the treatment of recurrent LGSOC. Verastem remains on track to report topline results from Part A during the second quarter of 2022, following discussions with regulatory authorities.
Enrollment has commenced in the expansion phase (Part B) of RAMP 201, with both treatment arms (VS-6766 alone and in combination with defactinib) currently advancing in all patients. Verastem expects to complete enrollment in Part B during the second half of 2022.
KRAS Mutant Non-Small Cell Lung Cancer (NSCLC)

Planned enrollment is now complete in the selection phase (Part A; n=32) of the registration-directed RAMP 202 study investigating VS-6766 alone and in combination with defactinib in patients with KRAS G12V mutant NSCLC. The Company expects to report topline results from Part A and initiate Part B during the second half of 2022, following discussions with regulatory authorities.
Based on preclinical rationale, Verastem has added BRAF mutant cohorts to the RAMP 202 study in order to efficiently evaluate VS-6766 with defactinib in BRAF-mutant NSCLC. In Part A of the study, the Company expects to enroll two cohorts comprised of 15 patients each to evaluate the combination in patients with V600E or non-V600E BRAF mutations, respectively. These cohorts are open and enrolling.
The Company entered into two clinical agreements to study VS-6766 in combination with KRAS G12C inhibitors in patients with KRAS G12C-mutant NSCLC, including patients who have progressed on a KRAS G12C inhibitor. Initial results from the ongoing Phase 1/2 RAMP 203 study evaluating VS-6766 in combination with Amgen’s LUMAKRASTM (sotorasib) are expected to be reported during the second half of 2022. Initiation of the Phase 1/2 RAMP 204 study evaluating VS-6766 in combination with Mirati’s adagrasib is expected during the second quarter of 2022.
Corporate Updates

Secured debt facility with Oxford Finance LLC for up to $150 Million. Under the terms of the credit facility with Oxford Finance LLC, Verastem drew an initial $25 million term loan at closing. The Company has the ability to access up to an additional $125 million in a series of tranches, $75 million of which are based on certain pre-determined milestones and $50 million at the lender’s discretion.
With the credit facility and expected milestones related to the sale of COPIKTRA (duvelisb) to Secura Bio Inc. (Secura) in 2020, the Company expects to have a cash runway through 2025 to support the continued development and potential commercial launches of VS-6766 and defactinib.
In the first quarter of 2022, Secura Bio Inc.’s (Secura) sublicensee, CSPC Pharmaceutical Group Limited, obtained drug registration approval for duvelisib granted by the National Medical Products Administration of the People’s Republic of China for the treatment of adult patients with relapsed or refractory follicular lymphoma after at least two prior systematic therapies. This entitles Verastem to a $2.5 million milestone payment from Secura, pursuant to the sale of COPIKTRA (duvelisb) to Secura in 2020.
Appointed Michelle Robertson to join the Verastem Board of Directors. Ms. Robertson is the Chief Financial Officer at Editas Medicine and brings more than 25 years of finance and commercial operations leadership to the Board. Timothy Barberich will be retiring from the Board as of March 31, 2022. Verastem appreciates his significant contributions since his appointment in March, 2014.
Appointed Channing Der, PhD, Sarah Graham Kenan Distinguished Professor at the University of North Carolina at Chapel Hill to the Company’s Scientific Advisory Board.
Fourth Quarter 2021 Financial Results

Total revenue for the three months ending December 31, 2021 (2021 Quarter) was $0.5 million, compared to $0.5 million for the three months ended December 31, 2020 (2020 Quarter).

Total research and development (R&D) and selling, general and administrative (SG&A) expenses for the 2021 Quarter were $17.1 million, compared to $17.3 million for the 2020 Quarter.

R&D expenses for the 2021 Quarter were $11.4 million, compared to $10.2 million for the 2020 Quarter. The increase of $1.2 million, or 11.8%, primarily resulted from increase in contract research organization costs and investigator fees.

SG&A expenses for the 2021 Quarter were $5.7 million, compared to $7.1 million for the 2020 Quarter. The decrease of $1.4 million, or 19.7%, primarily resulted from lower employee related expenses and consulting and professional fees.

Net loss for the 2021 Quarter was $16.5 million, or $0.09 per share (basic and diluted), compared to net loss of $19.9 million, or $0.12 per share (basic and diluted), for the 2020 Quarter.

For the 2021 Quarter, non-GAAP adjusted net loss was $14.9 million, or $0.08 per share (diluted), compared to non-GAAP adjusted net loss of $14.8 million, or $0.09 per share (diluted), for the 2020 Quarter. Please refer to the GAAP to Non-GAAP Reconciliation attached to this press release.

Full-Year 2021 Financial Results

Verastem Oncology ended the fourth quarter of 2021 with cash, cash equivalents and investments of $100.3 million. On a pro forma basis, inclusive of the funding received from the $25 million drawdown of new debt facility, cash, cash equivalents and investments were $125.3 million as of December 31, 2021.

Total revenue for the year ended December 31, 2021 (2021 Period) was $2.1 million, compared to $88.5 million for the year ended December 31, 2020 (2020 Period). Revenue for the 2021 Period was comprised of (i) $1.4 million of revenue recognized for milestones and royalties as part of the sale of COPIKTRA to Secura Bio, Inc. (Secura), and (ii) $0.6 million of transition services revenue for certain support functions provided to Secura pursuant to the Secura transition services agreement which was entered into in connection with the sale of COPIKTRA to Secura. Revenue for the 2020 Period revenue was comprised of (i) $70.0 million recognized for the upfront payment made as part of the sale of COPIKTRA to Secura, (ii) $15.2 million of net product revenue, (iii) $2.9 million of license and collaboration revenue, and (iv) $0.4 million of transition services revenue for certain support functions provided to Secura.

Total R&D and SG&A expenses for the 2021 Period were $63.5 million, compared to $104.1 million for the 2020 Period.

R&D expense for the 2021 Period was $39.3 million, compared to $41.4 million for the 2020 Period. The decrease of $2.1 million, or 5.1%, was primarily related to the upfront non-refundable payment of $3.0 million to Chugai Pharmaceutical Co., Ltd for the VS-6766 license in the 2020 Period, and a decrease in other operating costs. This decrease was partially offset by an increase in investigator fees and an increase in personnel related costs.

SG&A expense for the 2021 Period was $24.1 million, compared to $62.8 million for the 2020 Period. The decrease of $38.7 million, or 61.6%, was primarily resulted from the Company’s shift in strategic direction and the sale of COPIKTRA to Secura, which led to lower employee-related expenses and consulting and professional fees.

Net loss for the 2021 Period was $71.2 million, or $0.41 per share (basic and diluted), compared to $67.7 million, or $0.44 per share (basic and diluted), for the 2020 Period.

For the 2021 Period, non-GAAP adjusted net loss was $54.1 million, or $0.31 per share (diluted), compared to non-GAAP adjusted net loss of $37.8 million, or $0.25 per share (diluted), for the 2020 Period. Please refer to the GAAP to Non-GAAP Reconciliation attached to this press release.

Use of Non-GAAP Financial Measures

To supplement Verastem Oncology’s condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (GAAP), the Company uses the following non-GAAP financial measures in this press release: non-GAAP adjusted net (loss) income and non-GAAP net (loss) income per share. These non-GAAP financial measures exclude certain amounts or expenses from the corresponding financial measures determined in accordance with GAAP. Management believes this non-GAAP information is useful for investors, taken in conjunction with the Company’s GAAP financial statements, because it provides greater transparency and period-over-period comparability with respect to the Company’s operating performance and can enhance investors’ ability to identify operating trends in the Company’s business. Management uses these measures, among other factors, to assess and analyze operational results and trends and to make financial and operational decisions. Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used to supplement an understanding of the Company’s operating results as reported under GAAP, not in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with GAAP. In addition, these non-GAAP financial measures are unlikely to be comparable with non-GAAP information provided by other companies. The determination of the amounts that are excluded from non-GAAP financial measures is a matter of management judgment and depends upon, among other factors, the nature of the underlying expense or income amounts. Reconciliations between these non-GAAP financial measures and the most comparable GAAP financial measures for the three months and year ended December 31, 2021 and 2020 are included in the tables accompanying this press release after the unaudited condensed consolidated financial statements.

About VS-6766

VS-6766 (formerly known as CH5126766 and RO5126766) is a RAF/MEK clamp that induces inactive complexes of MEK with ARAF, BRAF and CRAF potentially creating a more complete and durable anti-tumor response through maximal RAS pathway inhibition. VS-6766 is currently in late-stage development.

In contrast to other MEK inhibitors, VS-6766 blocks both MEK kinase activity and the ability of RAF to phosphorylate MEK. This unique mechanism allows VS-6766 to block MEK signaling without the compensatory activation of MEK that appears to limit the efficacy of other inhibitors. The U.S. Food and Drug Administration granted Breakthrough Therapy designation for the combination of Verastem Oncology’s investigational RAF/MEK inhibitor VS-6766, with defactinib, its FAK inhibitor, for the treatment of all patients with recurrent low-grade serous ovarian cancer (LGSOC) regardless of KRAS status after one or more prior lines of therapy, including platinum-based chemotherapy.1

Verastem Oncology is conducting Phase 2 registration-directed trials of VS-6766 alone and with defactinib in patients with recurrent LGSOC and in patients with recurrent KRAS G12V-mutant NSCLC as part of its RAMP (Raf And Mek Program) clinical trials, RAMP 201 and RAMP 202, respectively. Verastem Oncology has also established clinical collaborations with Amgen and Mirati to evaluate LUMAKRAS (sotorasib) and adagrasib in combination with VS-6766 in KRAS G12C-mutant NSCLC as part of the RAMP 203 and RAMP 204 trials, respectively.

On March 28, 2022 Immunome, Inc. (Nasdaq: IMNM), a biopharmaceutical company that utilizes its human memory B cell platform to discover and develop first-in-class antibody therapeutics, reported financial results for the fourth quarter ended December 31, 2021 and provided a corporate update (Press release, Immunome, MAR 28, 2022, View Source [SID1234611062]).

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Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

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"There remains a clear need for safe and efficacious antibody treatments against COVID-19, especially those less susceptible to mutational drift. We believe our three-antibody cocktail, IMM-BCP-01, has strong potential to address that unmet need. We are pleased the FDA has given us a safe-to-proceed notification and lifted the clinical hold for our Investigational New Drug (IND) application," stated Purnanand Sarma, Ph.D., President and CEO of Immunome.

"Additionally, we continue to progress IMM-ONC-01, our novel, IL-38-targeting innate immune checkpoint inhibitor, towards an IND submission in the second half of 2022," Sarma continued. "Our preclinical work is ongoing, and we have analyzed IL-38 expression across nearly 60 tumor subtypes and we have confirmed a high frequency of expression in difficult to treat cancers, such as head and neck squamous cell carcinoma, gastroesophageal squamous carcinoma, and squamous lung carcinoma."

Fourth Quarter and Subsequent Highlights

·Demonstrated In Vitro Efficacy of IMM-BCP-01 Against SARS-CoV-2 Omicron Variant in Live Virus Testing. In February 2022, Immunome announced that IMM-BCP-01 demonstrated effective neutralization of the Omicron variant of COVID-19 in in vitro testing. The combination of two antibodies in Immunome’s antibody cocktail, IMM20253/IMM20184, demonstrated neutralization of the Omicron variant within 3.5-fold potency compared to a preclinical version of sotrovimab in a head-to-head test using live virus samples. Additionally, IMM20253 exhibited a novel mechanism of action not reported in any other EUA antibodies by promoting a proteolytic cleavage of the portion of the spike protein needed for ACE2 binding.

·IMM-BCP-01 IND Application for the Treatment of COVID-19. In March 2022, the FDA communicated that the clinical study can be initiated for our antibody cocktail for the treatment of SARS-CoV-2 following a brief clinical hold. Immunome is continuing its ongoing clinical preparations ahead of the Phase 1b trial.

This investigational work was funded by the U.S. Department of Defense’s (DOD) Joint Program Executive Office for Chemical, Biological, Radiological and Nuclear Defense (JPEO-CBRND) in collaboration with the Defense Health Agency (DHA) (Contract number: W911QY-20-9-0019).

Financial Highlights

•Cash and cash equivalents: As of December 31, 2021, cash and cash equivalents totaled $49.2M.
•Research and development (R&D) expenses: R&D expenses for the three months ended December 31, 2021 were $4.4M. R&D expenses for the year ended December 31, 2021 were $14.1M.
•General and administrative (G&A) expenses: G&A expenses for the three months ended December 31, 2021 were $3.5M. G&A expenses for the year ended December 31, 2021 were $10.6M.
•Net loss: Net loss attributable to common stockholders was $7.9M, or $.65 per share, for the three months ended December 31, 2021. Net loss attributable to common stockholders was $24.7M, or $2.14 per share, for the year ended December 31, 2021.
•As of December 31, 2021, Immunome has 12,110,373 shares of common stock outstanding.

On March 28, 2022 Alpha Tau Medical Ltd. (Nasdaq: DRTS) (Nasdaq: DRTSW), ("Alpha Tau" or the "Company"), the developer of the innovative alpha-radiation cancer therapy Alpha DaRT, reported full year 2021 financial results and provided a corporate update (Press release, Alpha Tau Medical, MAR 28, 2022, View Source [SID1234611061]).

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Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

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"We have had an incredibly productive year, where we observed a 100% complete response rate in our multi-center U.S. pilot trial of skin cancers led by Memorial Sloan Kettering, we received two Food and Drug Administration (FDA) breakthrough device designations, one in recurrent glioblastoma and one in certain skin cancers, and we completed our acquisition of Healthcare Capital Corp and became a Nasdaq listed company," noted Alpha Tau CEO Uzi Sofer. "We are now diligently working to initiate our multi-center U.S. pivotal trial by the middle of the year, and to expand our Alpha DaRT clinical trials into additional internal organs, including the prostate cancer trial that we hope to begin imminently in Israel."

Recent Corporate Highlights:

Received FDA Breakthrough Device Designation for Alpha DaRT in June 2021 for the treatment of squamous cell carcinoma of the skin and oral cavity without curative standard of care.
Received FDA Breakthrough Device Designation for Alpha DaRT in October 2021 for the treatment of recurrent glioblastoma multiforme (GBM), an aggressive malignant brain tumor, with an average 5-year survival rate of less than 10%.
Enrolled first patient in November 2021 in a combination trial of Alpha DaRT and pembrolizumab (Keytruda) for the treatment of recurrent unresectable or metastatic squamous cell carcinoma of the head and neck. An interim analysis is planned after the first 18 patients have been treated.
Reported results in January 2022 from the first pilot multi-center study of Alpha DaRT in the U.S., led by Memorial Sloan Kettering Cancer Center. In this trial of malignant skin and soft tissue cancer patients, a complete response, as measured by RECIST criteria, was observed in all ten out of ten tumors treated (100%), with no product-related serious adverse events reported. Alongside these data, a 98% overall response rate was observed in a pooled analysis of superficial tumors treated to date that have reached their efficacy endpoint measurement, across the Company’s various trials.
Released new pre-clinical data on the combination of Alpha DaRT with a PD-1 inhibitor, demonstrating that Alpha DART may induce responsiveness to anti-PD-1 therapy and activate T-cell function.
Completed its business combination in March 2022 with Healthcare Capital Corp., a special purpose acquisition company, raising approximately $90 million in gross proceeds and commenced trading its shares and warrants under the symbols "DRTS" and "DRTSW", respectively, on the Nasdaq Capital Market.
Upcoming Milestones

Planning to initiate a multi-center pivotal U.S. trial in skin cancers by the middle of 2022.
Planning to initiate feasibility trial in prostate cancer in Israel in second quarter of 2022.
Financial results for the full year ended December 31, 2021

R&D expenses for the year ended December 31, 2021 were $11.4 million, compared to $7.5 million in 2020, as spending increased due to expansion of the R&D team as well as increases in Alpha DaRT clinical trial activity.

Marketing expenses for the year ended December 31, 2021 were $0.5 million, compared to $0.3 million for 2020 due to increased engagement with third-party advisors and a return of marketing and conference activity that had previously decreased in 2020 due to COVID-19.

G&A expenses for the year ended December 31, 2021 were $1.9 million, compared to $1.4 million for 2020, attributed to an increase in headcount and related expenses, increased office-related expenses resulting primarily from relocation of the Company’s offices to Jerusalem, and increased audit fees in connection with preparations for public listing.

Financial expenses, net, for the year ended December 31, 2021 were $13.5 million, compared to net financial income of $0.5 million for 2020, primarily due to remeasurement of warrants, as well as changes in foreign exchange rates and a decrease in interest received from bank deposits.

For the year ended December 31, 2021, the Company had a loss attributable to ordinary shares of $27.3 million, or ($0.67) per share, compared to a loss of $8.9 million, or ($0.22) per share, in 2020. The greater loss in 2021 is primarily attributed to $13.3 million in financial expenses associated with warrant remeasurement.

Balance Sheet Highlights

As of December 31, 2021, the Company had cash and cash equivalents and deposits in the amount of $31.9 million, compared to $46.6 million at December 31, 2020. Subsequently, in March 2022 Alpha Tau raised gross proceeds of approximately $90 million from the Business Combination. The Company expects that this cash balance will be sufficient to fund operations for at least two years.

About Alpha DaRT

Alpha DaRT (Diffusing Alpha-emitters Radiation Therapy) is designed to enable highly potent and conformal alpha-irradiation of solid tumors by intratumoral delivery of radium-224 impregnated sources. When the radium decays, its short-lived daughters are released from the source and disperse while emitting high-energy alpha particles with the goal of destroying the tumor. Since the alpha-emitting atoms diffuse only a short distance, Alpha DaRT aims to mainly affect the tumor, and to spare the healthy tissue around it.