On November 10, 2022 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 nine months ended September 30, 2022 and provided a business update (Press release, Salarius Pharmaceuticals, NOV 10, 2022, View Source [SID1234623669]). Highlights of the third quarter of 2022 and recent weeks include:
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Financial Highlights
•Cash and cash equivalents were $16.8 million as of September 30, 2022, compared with $29.2 million as of December 31, 2021
•Net loss for the third quarter of 2022 was $14.4 million, or $6.41 per share, which included a loss on goodwill impairment of $8.9 million, or an impairment of $3.94 per share, compared with net loss for the third quarter of 2021 of $3.7 million, or $2.09 per share
•Higher operating expenses reflect initial SP-3164 costs as the company makes progress toward important near-term milestones
•Regained compliance with Nasdaq’s minimum-bid requirement following a reverse stock split
SP-3164 (Targeted Protein Degrader) Highlights
•Advanced plans for filing an Investigational New Drug (IND) application with the U.S. Food and Drug Administration (FDA) in the first half of 2023 after completing the pre-IND meeting process
•Presented favorable preclinical results at the 5th Annual Targeted Protein Degrader Summit showing:
oPotent cereblon binding, efficient degradation of select proteins and induction of cell death in both lymphoma and multiple myeloma cell lines
oSignificant increase in tumor growth inhibition compared with lenalidomide (Revlimid) and pomalidomide (Pomalyst) in multiple myeloma animal models
•Announced acceptance of an abstract for presentation at the American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting showing SP-3164 has:
oAttractive therapeutic properties compared with avadomide and lenalidomide (Revlimid)
oPotential to be administered at lower doses in clinic and provide a more flexible dosing regimen compared with avadomide
oIncreased and rapid protein (IKZF1) degradation compared with lenalidomide (Revlimid) and avadomide
oSignificantly increased tumor growth inhibition as a monotherapy compared with lenalidomide (Revlimid) in an established lymphoma mouse model
"The third quarter and recent weeks were productive yet challenging for Salarius. SP-3164, our promising targeted protein degrader or molecular glue, has been generating exciting preclinical data and commensurate interest within the scientific community. Next month at the 64th ASH (Free ASH Whitepaper) annual meeting, one of blood cancer’s most prestigious events of the year, Dr. Daniela Santiesteban, our director of targeted protein degradation development, will deliver a poster presentation providing an update on additional SP-3164 research data that we believe continue to support our excitement surrounding SP-3164. We remain focused on SP-3164 IND-enabling studies and are on track to submit the IND in the first half of 2023 and to begin clinical trials shortly thereafter," said David Arthur, CEO of Salarius.
Seclidemstat (Targeted Protein Inhibitor) Highlights
•Announced acceptance of an abstract for a presentation at ASH (Free ASH Whitepaper) by collaborators at the University of Texas MD Anderson Cancer Center showing that in six patients with myelodysplastic syndrome or chronic myelomonocytic leukemia, the combination of
seclidemstat with azacitidine appeared safe at current dose levels and showed initial signs of potential activity
oResponse to therapy was observed in two patients including one patient with a complete marrow response and another patient with a complete marrow response plus hematologic improvement who transitioned to allogeneic stem-cell transplantation, which is generally considered as a potential curative treatment
•On October 18, 2022, enrollment of new patients in the Salarius-sponsored seclidemstat sarcoma clinical trial and the MD Anderson investigator-initiated hematologic clinical trial was voluntarily paused due to a suspected unexpected serious adverse reaction (SUSAR); patients currently enrolled in both studies are able to continue treatment after consulting with their physician
oThe U.S. Food and Drug Administration (FDA) subsequently agreed with Salarius’ approach and placed the sarcoma trial on partial clinical hold; Salarius is working with the FDA to further analyze the available data with the goal of understanding how best to proceed and restart enrollment
•Salarius plans to report interim results from the Phase 1/2 study of seclidemstat in Ewing sarcoma and FET-rearranged sarcomas before the end of the year
Mr. Arthur continued, "Independent investigators at MD Anderson also had an abstract accepted for presentation at the upcoming ASH (Free ASH Whitepaper) meeting and exhibition, focused on seclidemstat. The abstract concludes that in the six hematologic or blood cancer patients for whom data was available, the combination of seclidemstat with azacitidine seems safe at the current dose levels and shows signs of potential activity. Further enrollment and follow-up will continue to explore this combination. We believe this interim data is an encouraging development for these patients in need of new treatment options and we are looking forward to an additional data update next month."
Mr. Arthur concluded, "Although recent months were punctuated by highs and lows, we remain optimistic about the company’s prospects. We are delighted to be part of the protein degradation sector of drug development, an exciting opportunity driven by the commercial success of first-generation molecular glues that together had 2021 global sales of more than $16 billion. We also remain excited about seclidemstat and look forward to reporting interim clinical data that could signal the potential for new treatment options. We are looking forward to the additional updates on both programs later this year."
Third Quarter Financial Results
Net loss for the third quarter of 2022 was $14.4 million, or $6.41 per share, compared with a net loss of $3.7 million, or $2.09 per share, for the third quarter of 2021. The increase in net loss was due to higher operating expenses, including development spending on SP-3164, which was acquired in January 2022. Net loss for the third quarter of 2022 included a non-cash charge of $8.9 million for impairment of goodwill related to the 2019 reverse merger with Flex Pharma, Inc.
Net cash used for operating activities during the third quarter of 2022 was $5.7 million, compared with $1.6 million during the same quarter last year.
Nine Month Financial Results
Net loss for the first nine months of 2022 was $25.2 million, or $12.13 per share, compared with a net loss of $8.7 million, or $5.41 per share, for the first nine months of 2021. The increase in net loss was primarily due to a $8.9 million one-time nonrecurring non-cash charge for impairment of goodwill, higher research and development expenses primarily resulting from the acquisition and development of SP-3164, higher seclidemstat development costs and higher general and administrative expenses. The 2021 period included grant revenue of $1.8 million, with no such revenue in 2022.
Net cash used in operating activities for the first nine months of 2022 was $12.9 million, compared with $7.5 million for the prior-year period. The increase was primarily due to higher research and development expenses.
As of September 30, 2022, Salarius had cash, cash equivalents and restricted cash of $16.8 million, compared with $29.2 million as of December 31, 2021. Current cash and cash equivalents are expected to fund the company’s planned operations into the second half of 2023.