On August 10, 2020 Forte Biosciences, Inc. (www.fortebiorx.com) (NASDAQ: FBRX), a clinical-stage biopharmaceutical company, reported the second quarter 2020 financial results and provided a general business update (Press release, Tocagen, AUG 10, 2020, View Source [SID1234563327]).

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"We are very happy to have concluded the reverse merger on June 15th and in that process, brought on a very well-respected group of investors, including Alger, BVF Partners, Franklin Templeton and OrbiMed to support Forte as we continue to grow the company. Our lead program, FB-401, developed in collaboration with the National Institute of Health (NIH) and the National Institute of Allergy and Infectious Diseases (NIAID), has shown great potential in the initial Phase 1/2a study in mild, moderate and severe atopic dermatitis patients, including adults and children as young as 3 years old." said Paul Wagner, Ph.D., CEO of Forte Biosciences "We look forward to further validating FB-401’s potential with the randomized trial in mild to moderate atopic dermatitis patients, including adults and children 2 years of age and older, which will be initiating shortly. There is a particular need for safe and effective atopic dermatitis therapies for children."

Second Quarter 2020 Financial Results

Merger

On June 15, 2020, Forte merged with Tocagen, a publicly traded biotechnology company, with Forte being the surviving entity. As part of the merger, each share of Forte common stock outstanding was converted into the right to receive 3.1624 shares of Tocagen common stock following a 15:1 reverse split of Tocagen’s common stock. Post-merger and post-reverse split, Forte had approximately 10.8 million shares of common stock outstanding, with prior Forte stockholders collectively owning approximately 84.7% of the combined company and prior Tocagen stockholders owning approximately 15.3%. Forte’s common stock is traded on the Nasdaq Capital Market under the ticker symbol "FBRX." Prior to the Merger, Forte was a privately-held company incorporated in Delaware.

Financing

During the second quarter of 2020, Forte raised $24 million in equity financing associated with the merger that closed on June 15, including a $4.6 million financing that closed on June 16. Forte Biosciences ended the quarter with approximately $28 million in cash which the company believes is sufficient to fund operations for at least the next 12 months. Forte had 11.2 million shares of common stock outstanding as of June 30, 2020.

Operating Results

Research and development expenses were $1.9 million and $3.3 million for the three and six months ended June 30, 2020, respectively, compared to $0.3 million and $1.2 million for the comparable periods in 2019. The increases in 2020 were primarily due to increased outsourced contract manufacturing costs and clinical development costs as we gear up to commence Phase 2 clinical trials for FB-401.

General and administrative expenses were $0.8 million and $1.4 million for the three and six months ended June 30, 2020, respectively, compared to $0.3 million and $0.6 million for the comparable periods in 2019. The increases in 2020 were primarily due to professional fees for legal, auditing, tax and business consulting services, and personnel expenses as we transitioned to being a public company.

In connection with the Merger, we recognized a charge of $32.1 million for acquired in-process research and development related to the reverse merger with Tocagen.

Additional detail on our financial results for the second quarter 2020 can be found in our Form 10-Q as filed today with the SEC. You can also find more information in the investor relations section of our website at www.fortebiorx.com.

Conference Call and Webcast Information

The Forte management will host a conference call and webcast today at 4:30 PM Eastern Time. Participants may access the call by dialing 877-300-8521 (Domestic) or 412-317-6026 (International), the conference ID number is: 10147071. The call will also be webcast and can be accessed from the investor relations section of Forte’s website at View Source or View Source A replay of the call will also be available through August 17th.