On August 10, 2023 Salarius Pharmaceuticals, Inc. (Nasdaq: SLRX), a clinical-stage biopharmaceutical company using protein inhibition and protein degradation to develop cancer therapies for patients in need of new treatment options, reported financial results for the three and six months ended June 30, 2023 and provided a business update (Press release, Salarius Pharmaceuticals, AUG 10, 2023, View Source [SID1234634212]).
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Financial and Business Highlights
•Cash and cash equivalents were $11.5 million as of June 30, 2023, compared with $12.1 million as of December 31, 2022
•Net loss for the second quarter of 2023 was $3.9 million, or $1.43 per share, compared with net loss for the second quarter of 2022 of $4.7 million, or $2.20 per share, reflecting lower spending on seclidemstat and lower general and administrative expenses
•Raised gross proceeds of $6.0 million from a private placement of common stock and warrants, and an additional $1.7 million from an At the Market facility
•Announced plans to explore strategic alternatives and implement measures to extend resources
"While the second quarter and recent weeks were highlighted by significant advancements in both of our development programs, after a review of each program’s future funding needs and the current financial markets, the Board of Directors has made the difficult decision to limit further drug development while we explore strategic alternatives for Salarius," said David Arthur, president and chief executive officer of Salarius Pharmaceuticals.
"It was an exceptionally difficult decision to initiate our cost-savings plans and explore strategic alternatives in light of the promising early seclidemstat Ewing sarcoma clinical data, seclidemstat hematological clinical data and the recent FDA clearance to begin the SP-3164 Phase 1 trial. Unfortunately, we believe the current public financial markets make it extremely challenging to raise sufficient capital to continue meaningful clinical development activities on our own," concluded Mr. Arthur.
The Company is conducting a comprehensive review of strategic alternatives focused on maximizing shareholder value including, but not limited to, an acquisition, merger, reverse merger, divestiture of assets, licensing or other strategic transactions involving the Company. However, there is no set timetable for this process and there can be no assurance that this process will result in the Company pursuing a transaction or that any transaction, if pursued, will be completed on attractive terms. If the Company is unable to complete a transaction it may be necessary to seek other alternatives for restructuring and resolving its liabilities, including an orderly wind-down. Salarius does not expect to disclose developments with respect to this process unless and until the evaluation of strategic alternatives has been completed or the Board of Directors has concluded that disclosure is appropriate or legally required.
In connection with the evaluation of strategic alternatives and in order to extend its resources, Salarius is implementing a cost-savings plan that includes a reduction in workforce by over 50% of its positions, with remaining employees focusing primarily on limited drug-development activities, completing the U.S. Food and Drug Administration (FDA) process to determine the clinical trial registration
requirements for the seclidemstat Ewing sarcoma program and supporting the exploration of strategic alternatives.
Second Quarter Financial Results
Research and development expenses declined to $2.4 million for the second quarter of 2023 from $2.9 million for the second quarter of 2022, primarily due to lower spending on seclidemstat offset by higher spending on SP-3164. Spending associated with seclidemstat and SP-3164 for the second quarter of 2023 was $1.1 million and $1.3 million, respectively, compared with $2.1 million and $0.8 million, respectively, for the second quarter of 2022. General and administrative expenses were $1.6 million for the second quarter of 2023, compared with $1.8 million for the second quarter of 2022, with the decline due to lower annual shareholder meeting expenses and overall compensation and benefit costs.
Year-to-Date Financial Results
Research and development expenses declined to $6.1 million for the first half of 2023 from $7.4 million for the prior-year period, primarily due to lower spending on seclidemstat offset by higher spending on SP-3164. Spending associated with seclidemstat and SP-3164 for the first half of 2023 was $2.4 million and $3.7 million, respectively, compared with $4.4 million and $3.0 million, respectively, for the prior-year period.
Net cash used for operating activities during the first half of 2023 was $7.6 million, an increase of $0.4 million from the same period a year ago. The increase is primarily due to a decrease in accounts payable.
As of June 30, 2023, Salarius had cash, cash equivalents and restricted cash of $11.5 million, compared with $12.1 million as of December 31, 2022. Current cash and cash equivalents are expected to fund the company’s planned operations through the fourth quarter of 2023 and enable the evaluation and implementation of strategic alternatives.
Seclidemstat Highlights
•The FDA removed its partial clinical hold on Salarius’ Phase 1/2 trial evaluating seclidemstat in combination with topotecan and cyclophosphamide as a potential treatment for patients with Ewing sarcoma
•The Company initiated the process with the FDA to determine the clinical trial registration requirements for the seclidemstat Ewing sarcoma program
•Previously reported interim data showed a 60% confirmed disease control rate and 7.4 months median time to tumor progression for first-relapse Ewing sarcoma patients, with no disease progression observed in either first- or second-relapse patients who achieved confirmed disease control
•The Company continues to monitor patients in the Ewing sarcoma trial and plans to release updated survival data in the coming months
•The FDA previously granted seclidemstat Fast Track, Orphan Drug and Rare Pediatric Disease designations for Ewing sarcoma
•University of Texas MD Anderson Cancer Center (MDACC) is working to restart their investigator initiated Phase 1/2 study with seclidemstat in combination with azacytidine in patients with myelodysplastic syndrome (MDS) and chronic myelomonocytic leukemia (CMML)
•Researchers at MDACC previously reported interim clinical trial results in patients who relapsed or progressed after hypomethylating agent therapy. Of eight evaluable patients, four (50%) had an objective response. These researchers reported a 90% probability of patient survival for 11 months in patients receiving seclidemstat plus azacitidine versus an expected survival of four to six months
SP-3164 Highlights
•On July 11, 2023 Salarius announced that the FDA had cleared the IND application to treat relapsed/refractory non-Hodgkin lymphoma patients with SP-3164.
•Presented NHL preclinical data at the European Hematology Association (EHA) (Free EHA Whitepaper) 2023 Hybrid Congress in June that showed:
oPotent degradation of Ikaros and Aiolos (I/A) in peripheral blood mononuclear cells (PBMC) within 2 hours of dosing, which increased in a dose- and time-dependent manner over 24 hours
oSP-3164 does not negatively impact PBMC at clinically relevant concentrations up to 96 hours post-treatment
oIn addition to having direct antitumor effects, SP-3164 also induces an anticancer immunomodulatory effect as demonstrated through the induction of cytokine secretion in human T cells following treatment
•Presented two abstracts at the AACR (Free AACR Whitepaper) Annual Meeting in April:
oOne presentation demonstrated the robust protein degradation effects of SP-3164 and its anticancer activity in NHL animal models as well as SP-3164’s compelling antitumor activity in animal models of follicular lymphoma, a type of NHL, as a single agent and in combination with venetoclax (Venclexta) or tazemetostat (Tazverik)
oThe other presentation demonstrated SP-3164’s compelling anticancer activity in cell lines and animal models of multiple myeloma. In animal models, SP-3164 demonstrated superior single-agent activity compared with the approved agents lenalidomide (Revlimid) and pomalidomide (Pomalyst), and the combination of SP-3164 and bortezomib (Velcade) was shown to be superior to the combination of pomalidomide and bortezomib.