On March 9, 2017 Agenus Inc. (NASDAQ: AGEN), an immuno-oncology (I-O) company with a pipeline of immune checkpoint antibodies and cancer vaccines, reported a corporate update and reported financial results for the fourth quarter and year ended December 31, 2016 (Filing, Q4/Annual, Agenus, 2016, MAR 9, 2017, View Source [SID1234518039]).

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"Actions we took last year put us on a path to register our lead antibodies that target CTLA-4 and PD-1 in the next four years. We also advanced programs directed at novel targets, such as 4-1BB and TIGIT, and upgraded our Berkeley manufacturing facility," said Garo H. Armen, Ph.D., Chairman and CEO of Agenus. "As we enter 2017, we have strengthened our balance sheet with our recently announced Incyte transaction resulting in a cash infusion of $80 million and a reduction of our cash burn rate for 2017 and beyond."

Incyte Collaboration

Earlier this year, Agenus amended its collaboration with Incyte, resulting in $80 million of cash to Agenus: $60 million from an equity investment at $6/share plus $20 million in accelerated clinical development milestones for the GITR and OX40 programs. In addition, these programs were converted from co-funded development and profit-share arrangements to royalty-bearing programs at a 15% royalty rate, with Agenus eligible for up to $510 million in future milestones.

UCB Collaboration

Agenus entered into a research collaboration with UCB to advance the development of multi-specific therapeutic antibodies. The collaboration presents a unique opportunity to discover novel therapeutics. This approach has the potential to expedite the development of Agenus’ portfolio of discovery programs focused on the next generation of I-O targets.

2017 Anticipated Milestones:

Start Phase 1 dose-escalation trial for anti-PD-1 antagonist AGEN2034 in H1.
Start Phase 1b combination trial with AGEN1884 (CTLA-4) and AGEN2034 (PD-1) in H2.
Start Phase 1 trial for AutoSynVax in H1.
Start cervical cancer trial for PD-1 monotherapy in H2.
Readouts of AutoSynVax immunogenicity in H2.
Execute additional strategic transactions.
2016 Select Highlights:

Research & Development

Started Phase 1 dose escalation trial of AGEN 1884, Agenus’ proprietary anti-CTLA-4 antibody.
Started Phase 1 trial for INCAGN1876, anti-GITR antibody in partnership with Incyte.
Started Phase 1 trial for INCAGN1949, anti-OX40 antibody in partnership with Incyte.
Advanced collaboration with Merck with the selection of a lead product candidate.
GlaxoSmithKline filed for regulatory approval of Shingrix vaccine containing Agenus’ QS-21 Stimulon.
Leadership

Appointed Ulf Wiinberg to Board of Directors, bringing three decades of leadership experience in the global biopharmaceutical industry to our governance team.
Appointed Dr. Jean-Marie Cuillerot as Vice President and Global Head of Clinical Development, who has since assumed the role of a Chief Medical Officer. Dr. Cuillerot has been integral to the development of Yervoy and Avelumab during his tenure at BMS and Merck Serono.
Fourth Quarter 2016 Financial Results
Cash, cash equivalents and short-term investments were $76.4 million as of December 31, 2016. Subsequent to the end of the year, Agenus received $80 million in cash as part of the amended partnership and stock purchase agreement with Incyte. The increased cash combined with substantially reduced clinical development expense obligations under the prior Incyte agreement, will significantly reduce our cash burn and extend our cash runway through the second quarter of 2018.

For the fourth quarter, Agenus reported a net loss of $26.1 million, or $0.30 per share, compared with a net loss for the fourth quarter of 2015 of $15.6 million, or $0.18 per share. The company’s cash burn for the quarter was approximately $19.0 million compared to approximately $27.9 million during the third quarter.

The increased net loss for the quarter ended December 31, 2016, compared to the same period in 2015, was due primarily to the expansion and growth of the research activities at the Company partially offset by non-cash income for the quarter ended December 31, 2016 of $9.4 million, due to the fair value adjustment of the contingent purchase price considerations compared to $623,000 for the same period in 2015. In addition, during the quarter ended December 31, 2015 we recorded a $5.4 million income tax benefit recognized as a result of our 2015 acquisitions.

For the year ended December 31, 2016, the Company incurred a net loss of $127 million, or $1.46 per share, compared with a net loss of $88 million, or $1.13 per share, in the same period in 2015.

The increase in net loss for the year ended December 31, 2016, compared to the net loss for the same period in 2015, was primarily due to the Company’s growth and to the advancement of our programs, and increased interest expense on our long-term debt partially offset by the decreased non-cash expense for fair value adjustments to our contingent obligations.