On May 13, 2024 Precision BioSciences, Inc. (Nasdaq: DTIL), an advanced gene editing company utilizing its novel proprietary ARCUS platform to develop in vivo gene editing therapies for sophisticated gene edits, including gene elimination, insertion, and excision, reported financial results for the first quarter ended March 31, 2024, and provided a business update (Press release, Precision Biosciences, MAY 13, 2024, View Source [SID1234643153]).
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"In 2024, Precision is focused on strong execution as we advance our wholly owned Hepatitis B virus (HBV) and primary mitochondrial myopathy (PMM) in vivo gene editing programs towards the clinic as soon as possible," said Michael Amoroso, Chief Executive Officer at Precision BioSciences. "In parallel, our partner, iECURE has already advanced the first ARCUS in vivo gene editing program for OTC deficiency into the clinic. We believe this not only validates ARCUS novel editing approach for gene insertion, but also sets key regulatory precedence for in vivo ARCUS gene editing programs across global markets including the US."
"We were pleased to regain control of three exciting development opportunities from our work with Prevail Therapeutics, which take advantage of ARCUS’ unique cut, size, and simplicity. Strong in vivo proof-of-concept data generated to date have yielded three advanced preclinical programs that we believe have first-in-class and best-in-class potential across multiple therapeutic areas. We are currently assessing which programs Precision will advance internally and seek to re-partner and expect to provide an update once plans have been finalized," added Mr. Amoroso.
"In addition to the important operational progress we continue to make with our wholly owned and partnered programs, we added cash to our balance sheet by monetizing our CAR T assets and completing a $40 million equity offering to extend our cash runway into the second half of 2026 to fund continued development of our programs."
Wholly Owned Portfolio – Lead Programs
PBGENE-HBV (Viral Elimination Program): Precision is developing PBGENE-HBV for the treatment of patients with chronic hepatitis B. Currently, it is estimated that approximately 300 million people worldwide are afflicted with chronic Hepatitis B. PBGENE-HBV is expected to be the first and only potentially curative gene editing program to enter the clinic that is specifically designed to eliminate cccDNA and inactivate integrated HBV DNA.
In February 2024, Precision announced that the company had received pre-IND regulatory feedback from the US Food and Drug Administration (FDA) in addition to regulatory feedback from agencies outside the US providing clarity and alignment on PBGENE-HBV investigational new drug (IND)/clinical trial application (CTA)-enabling preclinical plans and clinical strategy. PBGENE-HBV is advancing through final toxicology studies and Precision expects to submit an IND and/or CTA for this program in 2024.
PBGENE-PMM (Mutant Mitochondrial DNA Elimination Program): PBGENE-PMM is a first of its kind potential treatment for m.3243-associated PMM by targeting mutant mitochondrial DNA. Mitochondrial diseases are the most common hereditary metabolic disorder in the world. The m.3243 associated PMM that our program intends to address is sizable, affecting up to 25,000 people in the US alone. Precision scientists published new preclinical data in Nature Metabolism highlighting the high specificity of ARCUS nucleases designed to edit and eliminate mutant mitochondrial DNA while allowing wild-type (normal) mitochondrial DNA to repopulate in the mitochondria, thus improving cellular function. This is a differentiated program because unlike CRISPR/Cas, base editors, and prime editors, ARCUS nucleases are able to penetrate the mitochondrial membranes because they are single-component editors that do not require a guide RNA. The Company expects to submit an IND and/or CTA for PBGENE-PMM in 2025 for this program.
Wholly Owned Portfolio – Under Assessment
As previously announced, Precision’s collaboration with Prevail Therapeutics Inc., has concluded, and Precision exercised its option to regain rights for the three programs developed under the collaboration. The Company is in the process of conducting a portfolio assessment for the newly returned programs for internal development and/or development through new partners and expects to provide an update as decisions are finalized. These programs include:
PBGENE-DMD – novel gene excision approach for treatment of Duchenne Muscular Dystrophy utilizing a pair of ARCUS nucleases, delivered by a single adeno-associated virus (AAV), that are designed to excise an approximately 500,000 base pair mutation "hot spot" region from the dystrophin gene to generate a functionally competent variant of the dystrophin protein.
PBGENE-LIVER – liver target for gene insertion with data demonstrating that ARCUS is capable of 40% to 45% high efficiency gene insertion at 1- and 3-months in nondividing cells, the most challenging context for gene insertion, in adult nonhuman primates.
PBGENE-CNS – gene editing program targeting neurons to address a disease of the central nervous system.
Partnered Programs – In Vivo Gene Editing
iECURE-OTC (Gene Insertion Program): Led by iECURE, ECUR-506 is the first ARCUS-mediated in vivo gene editing program to advance into the clinic following regulatory approvals in the US, the United Kingdom, and Australia for initiation of the OTC-HOPE study. The OTC-HOPE study is a first-in-human Phase 1/2 trial evaluating ECUR-506 as a potential treatment for neonatal onset ornithine transcarbamylase (OTC) deficiency and has begun screening patients. iECURE has recently communicated that one site in the United Kingdom is open and recruiting patients for the OTC-HOPE study. Non-human primate (NHP) data presented by researchers from the University of Pennsylvania’s Gene Therapy Program demonstrated sustained gene insertion of a therapeutic OTC transgene one-year post-dosing in newborn and infant NHP’s with high efficiency. iECURE has received Fast Track designation from the FDA for ECUR-506 and expects initial data from this trial to be available in late 2024 or in 2025.
PBGENE-NVS (Gene Insertion Program): Precision continues to advance its gene editing program with Novartis to develop a custom ARCUS nuclease for patients with hemoglobinopathies, such as sickle cell disease and beta thalassemia. The collaborative intent is to insert, in vivo, a therapeutic transgene as a potential one-time transformative treatment administered directly to the patient to overcome disparities in patient access to treatment with other therapeutic technologies, including those that are targeting an ex vivo gene editing approach.
Business Updates – Monetization of CAR T Investments:
Completed Licensing Deal with TG Therapeutics for Cell Therapy Azer-Cel in Autoimmune Diseases, and Other Indications Outside of Cancer:
In January 2024, Precision announced the completion of a transaction with TG Therapeutics (Nasdaq: TGTX) for certain exclusive and non-exclusive license rights to develop Azercabtagene Zapreleucel (azer-cel) for autoimmune diseases and other indications outside of cancer. In exchange for these rights, Precision received upfront and potential near-term economics valued at $17.5 million. Precision is eligible to receive up to $288 million in additional milestone payments based on the achievement of certain clinical, regulatory, and commercial milestones, in addition to high-single-digit to low-double-digit royalties on net sales of the licensed product.
Completed Non-Exclusive Patent License Agreement with Caribou Biosciences:
In February 2024, Precision announced that it had granted Caribou Biosciences (Nasdaq: CRBU) a non-exclusive, worldwide license, with the right to sublicense, to one of Precision’s foundational cell therapy patent families for use with CRISPR-based therapies in the field of human therapeutics. The licensed patents and applications include method and composition of matter claims that relate to Precision’s approach for targeted insertion of a sequence encoding an exogenous antigen binding receptor, such as a CAR, into the T cell receptor alpha constant (TRAC) gene locus of human T cells via a single gene edit. The licensed family, which includes more than 20 granted US and international patents, expires in October 2036.
This patent family is potentially also available for non-exclusive license to other high-quality partners in the cell therapy space.
Business Updates – $40 Million Offering:
On March 1, 2024, Precision completed a $40 million public underwritten offering consisting of 2,500,000 shares of its common stock and accompanying warrants to purchase up to 2,500,000 shares of common stock at a combined offering price of $16.00 price per share, for total gross proceeds of $40 million, before deducting underwriting discounts and commissions. The financing included participation from leading life sciences investors, including Perceptive Advisors, Janus Henderson Investors, Aquilo Capital Management, LLC and LYFE Capital.
Quarter Ended March 31, 2024 Financial Results:
Cash and Cash Equivalents: As of March 31, 2024, Precision had approximately $137.8 million in cash and cash equivalents. Existing cash and cash equivalents, upfront and potential near-term cash from CAR T transactions, along with expected operational receipts, continued fiscal and operating discipline, availability of Precision’s at-the-market (ATM) facility, and available credit are expected to extend Precision’s cash runway into the second half of 2026. The company’s cash runway is expected to enable funding the development of our PBGENE-HBV and PBGENE-PMM in vivo gene editing programs through Phase 1 read out while enabling commencement of a new third wholly owned gene editing program.
Revenues: Total revenues for the quarter ended March 31, 2024, were $17.6 million, as compared to $8.8 million for the same period in 2023. The increase of $8.8 million was primarily driven by upfront investments from cell therapy transactions with TG Therapeutics and Caribou Biosciences.
Research and Development Expenses: Research and development expenses were $13.3 million for the quarter ended March 31, 2024, as compared to $11.0 million for the same period in 2023. The increase of $2.3 million was primarily due to increasing investment in our wholly owned in vivo gene editing programs, PBGENE-HBV and PBGENE-PMM, as the programs advance toward IND/CTA filing. The increases in program spending were partially offset by lower employee-related costs and lab supplies.
General and Administrative Expenses: General and administrative expenses were $8.4 million for the quarter ended March 31, 2024, as compared to $11.1 million for the same period in 2023. The decrease of $2.7 million was primarily related to lower employee-related costs and a reduction of external operational expenses.
Net Income/Loss from Continuing Operations: Net income from continuing operations was $8.6 million for the quarter ended March 31, 2024, inclusive of a $10.4 million non-cash gain on the fair value of our warrant liability which does not impact our cash runway, as compared to a net loss from continuing operations of $14.0 million, for the same period in 2023. The improvement was primarily related to the revenue growth compared to the prior period as well as the non-cash gain related to the fair value adjustments of our warrant liability and Elo equity investment.
Net Loss: Net income was $8.6 million, or $1.70 per share (basic and diluted), for the quarter ended March 31, 2024, as compared to a net loss of $25.1 million, or $(6.75) per share (basic and diluted), for the same period in 2023. The net loss in the first quarter of 2023 includes a $11.1 million loss from discontinued operations related to the decision to exit CAR T in August 2023.
Shares: Basic weighted-average common shares outstanding for the first quarter of 2024 were 5,060,978 compared to 3,709,894 for the same period in 2023. Following the common stock offering, we had 6,916,239 shares outstanding as of March 31, 2024.