On April 15, 2022 Brooklyn ImmunoTherapeutics, Inc. (Nasdaq:BTX) ("Brooklyn"), a biopharmaceutical company focused on exploring the role that cytokine, gene editing, and cell therapy can have in treating patients with cancer, blood disorders, and monogenic diseases, reported financial results for the fourth quarter and year ended December 31, 2021 (Press release, Brooklyn ImmunoTherapeutics, APR 15, 2022, View Source [SID1234612348]).
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Financial and corporate highlights for the quarter and year months ended December 31, 2021 and subsequently include the following:
Fourth quarter ended December 31, 2021:
Appointed Susan McClatchey as Vice President and Head of Quality
Named to both the Nasdaq Biotechnology Index and the ICE Biotechnology Index
Transitioned from the NYSE American to the Nasdaq Global Market to better align with industry peers
The period January 2021 – September 2021:
Appointed Howard J. Federoff, M.D., Ph.D., as Chief Executive Officer and President; Kevin D’Amour, Ph.D. as Chief Scientific Officer; Jay Sial as Chief Administrative Officer and Roger Sidhu, M.D. as Chief Medical Officer
Completed the acquisition of Novellus, Inc. ("Novellus") in July 2021, which developed next-generation engineered mesenchymal stem cell ("MSC") therapies using patented mRNA-based cell reprogramming and gene editing technologies licensed from Factor Bioscience ("Factor")
Raised over $52 million in net proceeds through equity line sales of common stock for general corporate purposes, including working capital to be used to enhance the development of the mRNA gene editing and cell therapies technology licensed from Factor
Published results of IRX-2 (a human-derived mixed cytokine product) monotherapy in early-stage breast cancer in Breast Cancer Research
Acquired an exclusive license for mRNA gene editing and cell therapies technology of Factor Bioscience Limited and Novellus Therapeutics
Became a public company pursuant to our merger transaction with NTN Buzztime, Inc. ("NTN")
Howard Federoff, M.D., Ph.D., Brooklyn’s President and Chief Executive Officer, commented, "2021 was a transformational year for Brooklyn ImmunoTherapeutics. I am proud to be working with our new team of experts and seasoned professionals, Roger Sidhu, M.D., Jay Sial and Kevin D’Amour, Ph.D. Together with our board of directors and scientific advisors, we are committed to our mission to discover, develop and deliver innovative products to patients who need them. We believe that we have created a leading platform company in cell, gene-editing and cytokine therapies, with a broad and deep pipeline. Our accomplishments in 2021 reflect our continued progress towards our vision of transforming patients’ lives through science.
Dr. Federoff continued: "We began 2022 with the launch of our new research and development facilities in San Diego, California. Another sign of our growth is the transfer of our common stock listing from the NYSE American to the Nasdaq Global Market in late 2021, being named to represent the biotech sector as part of the Nasdaq Biotechnology Index (Nasdaq:NBI) and being added to the ICE Biotechnology Index (NYSE:ICEBIO). We believe that our Nasdaq listing better aligns Brooklyn with industry peers, is more in line with the innovation we are pursuing and acknowledges and further validates our approach and technology."
"We believe that we are well positioned for growth. As we await the readout of our Phase 2b trial for neoadjuvant head and neck cancer with our original asset, IRX-2, during the second quarter of 2022, we continue investigator-driven trials in a number of additional cancer types and look forward to sharing these outcomes as appropriate. I want to thank the team for all of their hard work and commitment and our shareholders, partners and investors for their continued support," concluded Dr. Federoff.
Financial Results
Operating expenses for the three and twelve months ended December 31, 2021 were $9.1 million and $113.6 million, respectively, compared to $21.4 million and $26.5 million of operating expenses for the same periods in 2020.
Research and development expenses were $4.2 million and $93.2 million for the three and twelve months ended December 31, 2021, respectively, compared to $1.7 million and $4.0 million for the same periods in 2020, respectively. Research and development expenses increased during the fourth quarter primarily due to increased license fees and non-cash stock-based compensation resulting from the issuance of equity awards. Research and development expenses increased for the full year of 2021 due to license fees, non-cash stock-based compensation and $80.5 million of acquired in-process research and development expense related to the Novellus acquisition in July 2021.
General and administrative expenses were $4.4 million and $14.7 million for the three and twelve months ended December 31, 2021, respectively, compared to $0.6 million and $3.3 million during the same periods in 2020. The quarter-over-quarter and year-over-year increases in general and administrative expense were primarily related to increased legal, accounting and consulting fees, costs associated with being a publicly traded company, increased headcount, increased insurance expense and increased non-cash stock-based compensation.
The change in the fair value of contingent consideration was $0.6 million of expense for the three months ended December 31, 2021 and a credit of $0.2 million for the twelve months ended December 31, 2021 compared to expense of $19.2 million for both the three and twelve months ended December 31, 2020.
The Company recognized transaction costs of $5.8 million during the twelve months ended December 31, 2021 related to the value of shares issued to its banker for the merger transaction with NTN in March 2021, as well as a loss on the subsequent sale of the NTN assets of $9.6 million.
Net loss for the three and twelve months ended December 31, 2021 was $8.5 million and $122.3 million, respectively, compared to a net loss of $21.5 million and $26.5 million for the same period in 2020.
As of December 31, 2021, Brooklyn had approximately $17.0 million in cash, compared to $1.6 million as of December 31, 2020.