On March 24, 2021 Equillium, Inc. (Nasdaq: EQ), a clinical-stage biotechnology company developing itolizumab to treat severe autoimmune and inflammatory disorders, reported financial results for the fourth quarter and full year 2020, and provided an update on its clinical development programs (Press release, Equillium, MAR 24, 2021, View Source [SID1234577073]).
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"It was an exciting year of clinical advancement for Equillium and our lead asset, itolizumab, a first-in-class anti-CD6 monoclonal antibody that selectively targets the CD6-ALCAM pathway," said Bruce Steel, chief executive officer at Equillium. "As the pathway plays a central role in a number of immuno-inflammatory diseases, we think of itolizumab as a pipeline in a product and are currently evaluating the therapeutic in acute graft-versus-host disease, lupus and lupus nephritis, and uncontrolled asthma. While the pandemic caused delays in our clinical studies last year, we look forward to our forthcoming data from all three studies in 2021. We anticipate the data this year will be important for all stakeholders, but none more so than the patients with these severe and life-threatening diseases."
2020 and 2021 Year-to-Date Corporate Highlights:
Raised a total of $83.7 million in financing net proceeds in 2020 and through the registered direct offering completed in February 2021, strengthening Equillium’s balance sheet and extending its expected cash runway into the second half of 2023
Announced positive interim data from EQUATE study in acute graft-versus-host disease (aGVHD)
Presented translational data in aGVHD demonstrating the impact of itolizumab on effector T cell function at the:
Transplantation & Cellular Therapy Meetings of ASTCT & CIBMTR
Annual Meeting of the American Society of Hematology (ASH) (Free ASH Whitepaper)
2021 Transplantation and Cellular Therapy Meetings Digital Experience
Presented data at the 2020 American College of Rheumatology Meeting, demonstrating that CD6 modulation improves kidney and skin pathology in preclinical models of systemic lupus erythematosus (SLE)
Presented data at the European Respiratory Society International Congress 2020 demonstrating that the CD6-ALCAM pathway may contribute in multiple ways to asthma pathology
Strengthened leadership and positioned Equillium for organizational growth, including the following additions since the beginning of this year:
Dolca Thomas, M.D., appointed as executive vice president of research and development and chief medical officer
Y. Katherine Xu, Ph.D., partner at Decheng Capital, appointed to Equillium’s board of directors
Upcoming Catalysts:
EQUALISE Phase 1b study: topline data from Type A patients (SLE), 1Q 2021
EQUATE Phase 1b study: topline data in first-line aGVHD, 1H 2021
Regulatory feedback on proposed pivotal study in first-line aGVHD, Mid-2021
Initiate pivotal study in first-line aGVHD, 2H 2021*
EQUALISE Phase 1b study: interim data from Type B patients (lupus nephritis), 2H 2021
EQUIP Phase 1b study: topline data in uncontrolled asthma, 2H 2021
*Proposed protocol & timeline for site initiation contingent on regulatory review
Fourth Quarter and Full Year 2020 Financial Results
Research and development (R&D) expenses for the fourth quarter of 2020 were $6.6 million, compared with $5.4 million for the same period in 2019. The increase in the fourth quarter of 2020 compared to the same period in 2019 was due to greater headcount expenses, greater research and translational science expenses, and an increase in clinical development expenses driven by approximately $0.9 million in expenses incurred in the fourth quarter of 2020 associated with preparing to launch a registrational study in COVID-19 patients, which was discontinued. Those increases were partially offset by a reduction in overhead costs, especially travel, and lower consulting expenses. For the full year of 2020, R&D expenses were $19.4 million, compared with $17.6 million for the same period in 2019. The year-over-year increase in R&D expenses was primarily driven by greater headcount expenses and research expenses, offset by lower overhead costs, especially related to travel and recruiting, and lower total clinical development expenses related to the EQUIP study and the Australian R&D tax incentive credit, partially offset by increases in expenses associated with the EQUALISE study and preparing to initiate a study in COVID-19 patients.
General and administrative (G&A) expenses for the fourth quarter of 2020 were $2.4 million, compared with $2.2 million for the same period in 2019. The increase in the fourth quarter of 2020 compared to the same period in 2019 was due to greater headcount expenses, driven by higher stock-based compensation, and greater consulting expenses, partially offset by a reduction in overhead expenses driven by lower insurance costs. For the full year of 2020, G&A expenses were $10.2 million, compared with $9.1 million for the same period in 2019. The year-over-year increase was primarily due to increased headcount expenses, driven by greater stock-based-compensation but partially offset by lower salary expense, and greater consulting expenses, offset by lower legal costs and overhead expenses, especially related to travel.
Net loss for the fourth quarter of 2020 was $8.9 million, or $(0.36) per basic and diluted share, compared with a net loss of $7.6 million, or $(0.44) per basic and diluted share for the same period in 2019. Net loss for the full year of 2020 was $29.8 million, or $(1.46) per basic and diluted share, compared with a net loss of $25.6 million, or $(1.47) per basic and diluted share for the same period in 2019. The increase in net loss for the full year of 2020 compared to the same period in 2019 was driven primarily by greater operating expenses and to a lesser extent by lower interest income and higher interest expense.
Cash used in operations for the fourth quarter of 2020 was $8.3 million compared to $4.9 million in the third quarter of 2020. Key drivers of the quarter-over-quarter increase in cash used in operations include the resumption in enrollment in the EQUIP and EQUALISE studies following a pause earlier in the year due to COVID-19, payment of directors and officers annual insurance premiums in the fourth quarter, spending in the fourth quarter associated with preparing to launch a registrational study in COVID-19 patients that was discontinued, and a reimbursement from the Australian Taxation Office associated with our 2019 R&D tax incentive claim that was received in the third quarter.
Cash, cash equivalents and short-term investments totaled $82.2 million as of December 31, 2020, compared to $53.1 million as of December 31, 2019. Subsequent to 2020, Equillium further strengthened its balance sheet through the completion of a registered direct offering with Decheng Capital, which raised $29.9 million in net proceeds. Equillium believes that its cash and investments will be sufficient to fund its currently planned operations into the second half of 2023.
About Itolizumab
Itolizumab is a clinical-stage, first-in-class anti-CD6 monoclonal antibody that selectively targets the CD6-ALCAM pathway. This pathway plays a central role in modulating the activity and trafficking of T cells that drive a number of immuno-inflammatory diseases. Equillium acquired rights to itolizumab through an exclusive partnership with Biocon Limited.