On November 8, 2022 Precision BioSciences, Inc. (Nasdaq: DTIL), a clinical stage gene editing company developing ARCUS-based ex vivo allogeneic CAR T and in vivo gene editing therapies, reported financial results for the third quarter ended September 30, 2022 and provided a business update (Press release, Precision Biosciences, NOV 8, 2022, View Source [SID1234623425]).
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"Over the last year, Precision has made considerable progress against our corporate and development objectives. We executed a disciplined portfolio strategy to focus on human therapeutics, advanced our lead clinical stage CAR T programs, leveraged platform partnerships, and made data-informed decisions designed to maximize patient impact and extend our expected cash runway to the end of 2024," said Michael Amoroso, Chief Executive Officer of Precision BioSciences. "We have refined the scope of our CAR T portfolio, focusing on PBCAR0191, known as azer-cel, in the growing CAR T-relapsed population, which has shown high complete response rates, long-term responses, and peak CAR T expansion on par with autologous CAR T in durable responders. We are also exploring the potential of our immune-evading stealth cell technology with PBCAR19B in earlier line DLBCL patients with the goal of displacing autologous CAR T treatment options. Looking ahead, our team is focused on executing and advancing our clinical stage CD19 targeted CAR T programs and providing a clinical update in late Q4 2022 or early Q1 2023, depending on patient accrual and follow-up."
Mr. Amoroso continued, "We also advanced multiple in vivo gene editing programs, independently and with partners, highlighted by our research collaboration with Novartis in June and recent preclinical data shared at ESGCT. As a result of ARCUS’ versatility, recent high efficiency in vivo gene insertion data, and scientific progress with wholly-owned and partnered programs, we have commenced a portfolio review of our in vivo gene editing programs. We are exploring ways to expedite key programs, advance new indications, and maximize ARCUS’ core features which have the potential to enable high efficiency gene insertion and complex edits aimed at restoring genomic function and treating the underlying root cause of specific genetic diseases. Our aim is to focus on programs in which ARCUS is most differentiated and where we see potential for a clear and rapid path to market, while providing a potentially curative therapeutic solution to patients with the highest unmet need. We look forward to providing meaningful progress updates along the way."
Recent Developments and Upcoming Milestones:
Ex Vivo Allogeneic CAR T Portfolio:
PBCAR0191: PBCAR0191, azercabtagene zapreleucel (azer-cel), is Precision’s lead investigational anti-CD19 allogeneic CAR T candidate in a Phase 1/2a clinical trial of adult subjects with relapsed or refractory (R/R) non-Hodgkin lymphoma (NHL). An abstract on the cell dose and functional attributes of azer-cel that may be associated with positive safety and efficacy results for CAR T therapy in R/R B-cell lymphoma was accepted for poster presentation at the 64th ASH (Free ASH Whitepaper) Annual Meeting taking place December 10-13, 2022. The poster presentation will highlight the first analysis of an allogeneic CD19 CAR T product composition to demonstrate that strategies intended to maximize stem central memory T-cell fraction (CCR7+) while limiting CD4+ CCR7+ differentiated fraction may improve safety and efficacy of CAR T therapy.
Precision continues dosing subjects with optimized azer-cel CAR T cells in the CAR T relapsed population in which it has shown high and durable complete response rates, while further reducing the dose of lymphodepletion to standard levels in pursuit of best therapeutic index for this patient population.
PBCAR19B: PBCAR19B is Precision’s second generation, anti-CD19 targeting allogeneic CAR T candidate designed to evade immune rejection by host T cell and natural killer (NK) cells with a single-gene edit to knock-down beta-2 microglobulin and insert an HLA-E transgene. Precision continues to recruit patients at Dose Level 2 (flat dose of 540 million cells) with the intent to complete the Phase 1 dose escalation.
Precision expects to provide an update in late Q4 2022 or early Q1 2023, depending on patient accrual and follow-up, on its two distinct CD19 targeted products, including azer-cel which is aiming to achieve a potential first-in-class allogeneic CAR T therapy in the CAR T relapsed population, and PBCAR19B which is seeking to displace autologous CAR T in the second/third line DLBCL population.
PBCAR269A + GSI: PBCAR269A is Precision’s investigational allogeneic CAR T cell candidate targeting B-cell maturation antigen (BCMA) for R/R multiple myeloma in combination with nirogacestat, a gamma secretase inhibitor (GSI) developed by SpringWorks Therapeutics, Inc. The combination therapy and increased dose of PBCAR269A resulted in improved cell expansion, which correlated with increased clinical activity when compared to dose-matched PBCAR269A monotherapy treatment. However, in light of the competitive landscape of BCMA targeted therapies in multiple myeloma, Precision has made the strategic decision not to continue the PBCAR269A clinical program. All subjects enrolled in the study and evaluated for treatment with PBCAR269A and nirogacestat had acceptable tolerability results. While no clinical spending is planned, Precision researchers will evaluate further modifications to the BCMA construct aimed at enabling an allogeneic approach similar to that of autologous CAR T in multiple myeloma. Precision thanks the patients and clinicians for their participation in the PBCAR269A clinical program.
In Vivo Gene Editing Portfolio:
Precision believes that in vivo applications are particularly well suited to ARCUS because they require extremely low levels of off-target editing and efficient delivery. As a gene editing tool, ARCUS can be differentiated by unique attributes which are designed for precise, specific and versatile gene editing. By nature of its origin from a homing endonuclease, ARCUS can be particularly applicable to gene insertion and complex edits designed for gene repair aimed at restoring function, as well as more simple gene knock outs. ARCUS is also unique in its relatively small size which allows delivery to a wider range of cells and tissues using viral and non-viral gene delivery methods.
Novartis In Vivo Gene Editing Collaboration Precision is advancing its gene editing research and development collaboration and license agreement with Novartis to develop a single, custom ARCUS nuclease designed to insert a therapeutic transgene, in vivo, at a "safe harbor" location in the genome. This has the potential to be a one-time transformative treatment option for diseases including certain hemoglobinopathies such as sickle cell disease and beta thalassemia. In conjunction with the close of the agreement, Novartis made a $25 million equity investment in Precision in the second quarter of 2022 and Precision received $50 million in cash in the third quarter of 2022.
Lilly In Vivo Gene Editing Collaboration: Precision continues its in vivo gene editing collaboration with Lilly and is applying ARCUS nucleases for three initial targets, including Duchenne muscular dystrophy in muscle, a central nervous system directed target and a liver directed target.
PBGENE-HBV: Precision’s gene editing program for chronic Hepatitis B applies ARCUS to knock out persistent covalently closed circular DNA (cccDNA) and inactivate integrated hepatitis B genomes, potentially achieving durable HBV S-antigen (HBsAg) loss and reducing viral persistence. Preclinical data from this program were presented during ESGCT in October 2022. Data presented demonstrated that ARCUS efficiently targeted and degraded hepatitis B virus (HBV) cccDNA by 85% and reduced expression of HBsAg by 77% in HBV-infected primary human hepatocytes (PHH). Importantly, the optimized specificity of the ARCUS nuclease completely prevented detectable chromosomal translocations in the PHH model.
PBGENE-PH1: Precision has initiated IND-enabling activities for its PBGENE-PH1 candidate designed to knock out the HAO1 gene as a potential one-time treatment for primary hyperoxaluria type 1 (PH1).
PBGENE-PCSK9: In 2021, Precision initiated a collaboration with iECURE, pursuant to which iECURE is expected to advance Precision’s PBGENE-PCSK9 candidate through preclinical activities as well as a Phase 1 study in familial hypercholesterolemia. As of this date, IND enabling activities for PBGENE-PCSK9 have not been completed. Precision is in discussions with iECURE and will provide an update on the program when more information is available.
Other ARCUS Research:
International Conference on Ureagenesis Defects and Allied Conditions 20221: Preclinical data were presented by researchers from the University of Pennsylvania’s Gene Therapy Program in collaboration with iECURE, Precision’s partner, highlighting an ARCUS-based gene insertion approach for the treatment of ornithine transcarbamylase (OTC) deficiency. Non-human primate (NHP) data demonstrated stable insertion of the therapeutic gene one year post-dosing in newborn and infant NHPs In the follow up data, 12-month biopsies continued to demonstrate construct stability, with transduction efficiency up to 28.2% as measured by in-situ hybridization (ISH). These data further demonstrate the preclinical feasibility of using an ARCUS-mediated gene insertion approach.
ESGCT 29th Congress: Additional abstracts on ARCUS in vivo gene editing were presented in addition to Precision’s HBV program, including one poster presentation each on Precision’s Apolipoprotein C3 and mitochondrial DNA preclinical research.
APOC3 poster presentation: ARCUS gene editing of Apolipoprotein C3 results in substantial reduction in serum triglycerides in vivo
Mito DNA poster presentation: Specific elimination of m.3243A>G mutant mitochondrial DNA using mitoARCUS in cultured cells and a novel xenograft mouse model
Quarter Ended September 30, 2022 Financial Results:
Cash and Cash Equivalents: As of September 30, 2022, Precision had approximately $212.1 million in cash and cash equivalents. The Company expects that existing cash and cash equivalents, expected operational receipts, and available credit will be sufficient to fund its operating expenses and capital expenditure requirements to the end of 2024.
Revenues: Total revenues for the quarter ended September 30, 2022 were $7.4 million, as compared to $24.0 million for the same period in 2021. The decrease of $16.6 million in revenue during the quarter ended September 30, 2022 was primarily the result of the absence of $17.9 million in revenue recognized under the iECURE Agreement in August 2021 subsequent to the full satisfaction of the performance obligation. These decreases in revenue were partially offset by an increase of $3.6 million in revenue recognized under the Novartis Agreement.
Research and Development Expenses: Research and development expenses were $20.0 million for the quarter ended September 30, 2022, as compared to $25.9 million for the same period in 2021. The decrease of $5.9 million was primarily due to a decrease of $3.6 million in external development costs associated with our allogeneic CAR T product candidates, a decrease of $0.9 million in employee-related and other operational costs driven by the separation of Elo in 2021, and a decrease of $1.4 million in clinical manufacturing organization and research costs related to our preclinical studies.
General and Administrative Expenses: General and administrative expenses were $10.3 million for the quarter ended September 30, 2022, as compared to $9.6 million for the same period in 2021. The increase of $0.7 million was primarily due to increased share-based compensation expense.
Other Income and Expense: Total other expense was $1.0 million for the quarter ended September 30, 2022, as compared to total other income of $0.3 million for the same period in 2021.
Net Loss: Net loss was $23.9 million, or $(0.22) per share (basic and diluted), for the quarter ended September 30, 2022, as compared to net loss of $11.3 million, or $(0.19) per share (basic and diluted), for the same period in 2021. Weighted average shares of common stock outstanding were approximately 110.8 million for the quarter ended September 30, 2022, as compared to approximately 59.7 million for the quarter ended September 30, 2021. The increase in weighted average shares of common stock outstanding was primarily due to a $50 million underwritten offering of common stock and Novartis’ $25 million equity investment in the nine months ended September 30, 2022.
Corporate:
Executive Leadership: In September 2022, Cindy Atwell, formerly Senior Vice President of Business Development and Alliance Management, was promoted to Chief Business Officer and continues to oversee the Business Development and Alliance functions with added responsibility for Project and Portfolio Management. Jeff Smith, Ph.D., co-founder and formerly Chief Technology Officer, was promoted to Chief Research Officer and assumed responsibility for the management and direction of the Company’s research programs, reporting directly to the CEO. Derek Jantz, Ph.D., co-founder and Chief Scientific Officer is focusing his time partnering with Michael Amoroso in formulating company strategy and managing relationships with external stakeholders, including current and potential collaboration partners.