On August 2, 2018 Adaptimmune Therapeutics plc (Nasdaq:ADAP), a leader in T-cell therapy to treat cancer, reported financial results for the second quarter ended June 30, 2018, and provided a business update (Press release, Adaptimmune, AUG 2, 2018, View Source [SID1234528617]).
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"2018 is a year of delivery for Adaptimmune," said James Noble, Adaptimmune’s CEO. "We have completed multiple studies with the NY-ESO program, and released data showing responses in a second solid tumor. We have transitioned it to GSK as planned and will shortly be receiving payment of $27 million. We are now entirely focused on our wholly owned INDs, and remain on track to deliver initial response data from our MAGE-A10 and MAGE-A4 programs in the second half of 2018."
Clinical momentum in wholly owned programs
Adaptimmune will now focus its clinical, regulatory, and manufacturing organization on its wholly owned therapies – MAGE-A4, MAGE-A10, and AFP
·Dosing at one billion or more SPEAR T-cells across all studies with MAGE-A10 and MAGE-A4, and on track for response readouts from multiple solid tumors throughout the remainder of 2018.
·Initial safety data from AFP in hepatocellular carcinoma also on track for late 2018.
NY-ESO program transitioned to GSK
·As announced on July 24, 2018 (https://bit.ly/2LKhSvm), the NY-ESO SPEAR T-cell program has transitioned to GSK.
·Adaptimmune will receive $27.5 million (£21.2 million) from GSK as a result of the transition, as well as subsequent development and sales milestones and royalties based on successful development by GSK of this program.
Manufacturing
Adaptimmune is increasing the capacity of its dedicated manufacturing facility
·Routinely manufacturing SPEAR T-cells at the Navy Yard at target cell doses
Developing the capability at the Navy Yard to scale up to 30 manufacturing slots per month from the current number of 8 to 10 per month
·Maintaining 8 to 10 dedicated patient manufacturing slots per month at HCAT
Other corporate news
Adaptimmune is focused on its next stage of development and in a strong position to deliver success with SPEAR T-cell therapies
·Rafael Amado, Adaptimmune’s Chief Medical Officer, has assumed a new role as President of Research & Development effective from August 1, 2018. This brings together the clinical and research teams under a single leadership, which will allow better alignment and integration of all parts of R&D, from target identification and selection, to regulatory filings, enabling the delivery of Adaptimmune’s key priorities.
· Adaptimmune is ready for the next stage of clinical development and actively planning for registration trials, whether indication or target specific
· Funded through to early 2020 with cash and cash equivalents of $42.3 million and total liquidity(1) of $129.0 million, which does not include $27.5 million in payments from GSK as a result of the transition as this was invoiced after the second quarter
·Announced in April 2018 (https://bit.ly/2v7v3D3) that John Furey, Chief Operating Officer at Spark Therapeutics, was appointed as an independent Non-Executive Director to Adaptimmune’s Board of Directors, which became effective July 5, 2018
Financial Results for the three-month period ended June 30, 2018
Cash / liquidity position: As of June 30, 2018, Adaptimmune had cash and cash equivalents of $42.3 million and Total Liquidity(1) of $129.0 million, which does not include $27.5 million in payments from GSK as a result of the transition as this was invoiced after the second quarter
·Revenue: With effect from January 1, 2018, the Company has adopted a new accounting standard(2). Under this new accounting standard, revenue represents the upfront payment and milestones under the GSK Collaboration and License Agreement, which are recognized based on the percentage completion of the NY-ESO and PRAME development programs. Revenue for the three and six months ended June 30, 2018 was $9.0 million and $17.2 million, respectively. Revenue for the three and six months ended June 30, 2018 under the previous guidance would have been $3.3 million and $12.3 million, respectively, compared to $3.5 and $6.4 million for the same periods of 2017. The increase in revenue, compared to the six-month period in 2017, is primarily due to a reduction in the period over which the Company is recognizing revenue following GSK’s exercise of its option over the NY-ESO program in September 2017 and additional development milestones achieved.
·Research and development ("R&D") expenses: R&D expenses for the three and six months ended June 30, 2018 were $26.7 million and $52.0 million, respectively, compared to $19.6 million and $38.2 million for the same periods of 2017. The increase was primarily due to increased costs associated with clinical trials, manufacturing for clinical trials, and increased personnel costs.
· General and administrative ("G&A") expenses: G&A expenses for the three and six months ended June 30, 2018 were $11.3 million and $22.5 million, respectively, compared to $7.7 million and $14.2 million for the same periods of 2017. The increase was primarily due to increased personnel costs consistent with the Company’s planned growth, an increase in costs associated with developing its IT infrastructure and an increase in other corporate costs.
·Other (expense) income, net: Other expense for the three and six months ended June 30, 2018 was $15.4 million and $8.3 million, respectively, compared to an income of $3.2 million and $3.7 million for the same periods of 2017. Other income primarily comprises unrealized foreign exchange gains, which fluctuate depending on exchange rate movements and the amount of foreign currency assets and liabilities.
· Net loss: Net loss attributable to holders of the Company’s ordinary shares for the three and six months ended June 30, 2018 was $43.8 million and $64.6 million respectively ($(0.08) and $(0.11) per ordinary share) compared to $20.2 million and $42.0 million ($(0.04) and $(0.09) per ordinary share) in the same periods of 2017.
Financial guidance
The Company believes that its existing cash, cash equivalents, marketable securities and income from GSK upon transition of the NY-ESO program will fund the Company’s current operations through to early 2020.
Conference call information
The Company will host a live teleconference and webcast to provide additional details at 8:00 a.m. EDT (1:00 p.m. BST) today, August 2, 2018. The live webcast of the conference call will be available via the events page of Adaptimmune’s corporate website at www.adaptimmune.com. An archive will be available
(1) Total liquidity is a non-GAAP financial measure, which is explained and reconciled to the most directly comparable financial measures prepared in accordance with GAAP below.
(2) ASC 606, Revenue from Contracts with Customers.
after the call at the same address. To participate in the live conference call, please dial (833) 652-5917 (U.S.) or +1 (430) 775-1624 (International). After placing the call, please ask to be joined into the Adaptimmune conference call and provide the confirmation code (8149978).