On March 9, 2023 Summit Therapeutics Inc. (NASDAQ: SMMT) ("Summit," "we," or the "Company") reported its financial results and provides an update on operational progress for the fourth quarter and year ended December 31, 2022 (Press release, Summit Therapeutics, MAR 9, 2023, View Source [SID1234628482]).
Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:
Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing
Schedule Your 30 min Free Demo!
Operational & Corporate Updates
Our Collaboration and License Agreement with Akeso Inc. ("Akeso") for ivonescimab:
On December 5, 2022, Summit and Akeso entered into a Collaboration and License Agreement for ivonescimab, Akeso’s breakthrough, potentially first-in-class bispecific antibody combining the effects of immunotherapy via a blockade of PD-1 with the anti-angiogenesis effects associated with blocking VEGF into a single molecule.
Summit received the rights to develop and commercialize ivonescimab (SMT112) in the United States, Canada, Europe, and Japan. Akeso retained development and commercialization rights for the rest of the world, including China.
In exchange for these rights, Summit committed to an upfront payment of $500 million to be paid in two installments.
The first installment worth $300 million was paid in January in conjunction with the closing of the transaction. Of the $300 million paid to Akeso by Summit, Akeso opted, in accordance with the Collaboration and License Agreement, to receive 10 million shares of Summit common stock valued at $25.1 million; the remaining $274.9 million was paid by Summit to Akeso in cash.
The second installment of $200 million was paid on March 6, 2023 in cash.
Going forward, Akeso will be eligible to receive regulatory and commercial milestones of up to $4.5 billion. In addition, Akeso will receive low double-digit royalties on net sales in the Summit territories.
Summit is initiating development activities for SMT112 and will do so first in non-small cell lung cancer (NSCLC) indications. Summit intends to start treating patients in clinical studies during the second quarter of 2023.
Summit is in communication with and has planned multiple meetings with health authorities, including the US Food & Drug Administration ("FDA") in order to align on our approach for multiple potential late-stage trials for SMT112.
The deal closed on January 17, 2023 following customary waiting periods. At this time, Michelle Xia, Ph.D., Co-Founder, Chairwoman, and CEO of Akeso, was appointed to our Board of Directors.
Dr. Xia has exceptional experience in leadership across scientific discovery, R&D, building and scaling manufacturing, and overall leadership through her experience at companies in the US. Prior to founding Akeso, Dr. Xia held roles of increasing leadership at Celera Genomics, Bayer, and Crown Biosciences. Dr. Xia has approximately 20 years of experience in the pharmaceutical industry and academic research in the US and the UK alone, in addition to her deep experience in China leading Akeso.
Akeso has a rich and diversified antibody drug pipeline with over 30 internally discovered drug candidates in various stages of development, including six bispecific antibodies. Akeso has taken part in over 80 clinical trials for 17 drug candidates, including 14 pivotal trials. Akeso has two drugs approved for oncology indications in China: a PD-1 inhibitor, and novel PD-1 / CTLA-4 bispecific antibody. Akeso has over 2,300 employees.
In October 2022, we announced the appointment of renowned biotech executive and scientific leader, Dr. Robert Booth, PhD, to our Board of Directors. Dr. Booth initiated the BTK inhibitor program at Celera Genomics, Inc. that ultimately became Pharmacyclics, Inc.’s IMBRUVICA (ibrutinib), the blockbuster drug that changed the paradigm of treatment for many hematological cancers. In addition to his scientific breakthrough discoveries, Dr. Booth was an adjunct professor at Stanford University School of Medicine. He is the co-founder of CuraSen Therapeutics and its former Executive Chairman, and was the co-founder and CEO of Virobay Inc. in addition to his previous role as a Senior Vice President at Roche. Dr. Booth previously served on the boards of Pharmacyclics and CymaBay Inc.
In November 2022, we appointed experienced clinical leader, Dr. Alessandra Cesano, MD, to our Board of Directors. Dr. Cesano is the Chief Medical Officer (CMO) at Essa Pharma Inc. (NASDAQ: EPIX), a clinical-stage pharmaceutical company focused on developing novel therapies for the treatment of prostate cancer. Previously, she was the CMO at NanoString Inc. and Cleave Biosciences. She has 25 years of experience in the biopharmaceutical industry focused in oncology, including extensive experience at Biogen, Amgen, and GSK. She was instrumental in the development and approval of two marketed drugs including Vectibix (panitumumab), an anti-EGFR antibody for the treatment of certain colorectal cancers. Dr. Cesano currently serves on the board of Puma Biotechnology Inc. (NASDAQ: PBYI), a clinical stage oncology company focused on solid tumors.
Financial Highlights
Aggregate cash and cash equivalents, restricted cash, accounts receivable, and tax credits receivable on December 31, 2022 totaled $654.7 million as compared to $89.0 million on December 31, 2021. Our cash and cash equivalents and restricted cash balance on December 31, 2022 was $648.6 million as compared to $71.8 million on December 31, 2021. Accounts receivable and research and development tax credits receivable on December 31, 2022 were $6.1 million as compared to $17.2 million on December 31, 2021.
Net loss for the three months ended December 31, 2022 and 2021 was $19.2 million and $27.1 million, respectively. Net loss for the year ended December 31, 2022 and 2021 was $78.8 million and $88.6 million, respectively.
Operating cash outflow for the year ended December 31, 2022 and 2021 was $41.6 million and $72.6 million, respectively.
On December 6, 2022, the Company entered into a Note Purchase Agreement with the Company’s Chairman and CEO, Robert W. Duggan, and the Company’s Co-Chief Executive Officer, President, and a member of the Company’s Board of Directors, Dr. Maky Zanganeh, in the aggregate amount of $520.0 million. Interest due and payable through February 15, 2023 was prepaid in shares of the Company’s common stock.
On February 15, 2023, Dr. Zanganeh’s $20.0 million note became due and the Company repaid the outstanding principal balance.
On December 6, 2022, the Company announced a Rights Offering for its existing shareholders to participate in the purchase of additional shares of its common stock. The Rights Offering commenced on February 7, 2023, and the associated subscription rights expired on March 1, 2023. Through the fully subscribed Rights Offering, the Company raised $500.0 million in gross proceeds through the issuance and sale of 476.2 million shares of its common stock at a price per share of $1.05. Issuance costs associated with the Rights Offering were approximately $0.5 million, resulting in net proceeds of approximately $499.5 million.
In connection with the closing of the rights offering, a $400 million note payable with Mr. Duggan, matured and became due, and the Company repaid all principal and accrued interest of $401.3 million using a portion of the proceeds from this Rights Offering.
Based on our current cash balance, including the net proceeds received from our Rights Offering, repayments of certain notes, and payments to Akeso in accordance with our Collaboration and License Agreement during the first quarter of 2023, we believe that we have sufficient capital resources to fund our operating costs and working capital needs, including our planned clinical trials for ivonescimab, into the second half of 2024.
After accounting for the information described above, as of February 28, 2023, we have a current aggregate cash and cash equivalents, accounts receivable, and tax credits receivable balance of approximately $240 million, inclusive of approximately $100 million in notes payables due in September 2024.
Q4 and Year-end 2022 Earnings Call
Summit’s management team will host an earnings call to discuss its fourth quarter 2022 financial results and provide an operational update for the Company today, March 9, 2023, at 9:00am ET. It will be accessible through Summit’s website www.smmttx.com or through the following link: View Source An archived version of the webcast will be available on our website.