On March 25, 2022 Exicure, Inc. (NASDAQ: XCUR), a pioneer in gene regulatory and immunotherapeutic drugs utilizing spherical nucleic acid (SNA) technology, reported full year financial results for the quarter and year ended December 31, 2021 and provided an update on its business strategy and corporate progress (Press release, Exicure, MAR 25, 2022, View Source [SID1234611018]).
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"This past year brought significant challenges to our organization that prompted strategic decisions at year-end to refocus our business strategy on our next generation pipeline and investments in neuroscience in order to be cash efficient," said Matthias Schroff, Ph.D., Chief Executive Officer of Exicure. "Entering 2022, I believe we are off to a good start as we have now fully aligned our resources to support development of our preclinical programs targeting SCN9A for the treatment of pain and advancement of ongoing discovery associated with our Ipsen and AbbVie partner programs. I want to acknowledge our team for their commitment to moving our company forward during this difficult time and thank them for their continued dedication in our mission to pursue treatments for patients with unmet medical needs," concluded Dr. Schroff.
Corporate Progress
Corporate highlights for 2021 include:
•Entered into an exclusive collaboration targeting rare neurodegenerative disorders with Ipsen in July 2021 to research, develop, and commercialize novel Spherical Nucleic Acids (SNAs) as potential investigational treatments for Huntington’s disease (HD) and Angelman syndrome (AS).
•Completed a strategic review in fourth quarter of 2021, which resulted in a restructuring and pipeline focus on preclinical programs targeting SCN9A in pain and partnered programs.
•Completed a $11.5 million registered direct offering in December 2021.
Priorities for 2022 include:
•Advancement of the Company’s SCN9A preclinical discovery program. Exicure anticipates results from initial in vivo animal studies by year-end 2022 with goal of therapeutic candidate selection in the second half of 2023.
•Progressing work with the Company’s partnered programs, with plan of meeting potential pre-clinical milestones in 2023.
•Actively pursuing strategic out-license opportunities for cavrotolimod.
•Ongoing pursuit of near-term partnering opportunities for pain and other neuroscience programs.
2021 Financial Results
Cash Position: Cash, cash equivalents and short-term investments were $48.3 million as of December 31, 2021, as compared to $83.3 million as of December 31, 2020. The Company expects that its cash and cash equivalents will fund its current operations into the fourth quarter of 2022.
Revenue: Revenue was $(0.5) million during the year ended December 31, 2021, reflecting a decrease of $17.1 million from revenue of $16.6 million for the year ended December 31, 2020. The decrease in revenue is mostly due to a decrease in non-cash revenue of $19.3 million associated with the Company’s collaboration with AbbVie partially offset by the recognition of non-cash revenue of $2.3 million associated with the Company’s collaboration with Ipsen. Revenue recognized (reversed) associated with the Company’s collaboration with AbbVie for the year ended December 31, 2021 reflects the cumulative catchup adjustment (reduction) of revenue in connection with the change in estimate that resulted from a change in workplan related to the Company’s collaboration with AbbVie during the third quarter of 2021.
Research and Development (R&D) Expense: Research and development expenses were $49.0 million for the year ended December 31, 2021, as compared to $32.1 million for the year ended December 31, 2020. The increase is due to an increase in clinical trial activities during the year as well as the impact of higher than average headcount during 2021 as compared to the prior year period.
General and Administrative (G&A) Expense: General and administrative expenses were $13.1 million for the year ended December 31, 2021, as compared with $10.0 million for the year ended December 31, 2020. The increase is mostly due to costs related to new hires needed to grow the Company as it evolved, one-time severance costs of $0.6 million associated with the December 2021 restructuring, as well as higher legal costs and other costs associated with being a public company.
Net Loss: The Company had a net loss of $64.1 million for the year ended December 31, 2021, as compared to a net loss of $24.7 million for the year ended December 31, 2020. The increase in net loss was primarily driven by lower non-cash revenue during the period largely impacted by the reversal of non-cash revenue in 2021 associated with Exicure’s collaboration with AbbVie as well as higher R&D and G&A costs as discussed above.
Going Concern: The Company’s expectation to continue to generate operating losses and negative operating cash flows in the future and the need for additional funding to support its planned operations raise substantial doubt regarding its ability to continue as a going concern within one year after the date that its consolidated financial statements for the year ended December 31, 2021 are issued. The Company will require additional financing to address the Company’s working capital and other financing needs.