On August 12, 2021 Humanigen, Inc. (Nasdaq: HGEN) ("Humanigen"), a clinical stage biopharmaceutical company focused on preventing and treating an immune hyper-response called "cytokine storm’" with its lead drug candidate, lenzilumab, reported financial results for the second quarter and six months ended June 30, 2021 (Press release, Humanigen, AUG 12, 2021, View Source [SID1234586479]).
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Update on Status of Emergency Use Authorization ("EUA") Application
On May 28, 2021, Humanigen submitted an EUA application for lenzilumab in patients hospitalized with COVID-19. Since that time, the company has responded to several requests from the U.S. Food and Drug Administration ("FDA") regarding the application. No formal timelines exist for the FDA to complete their review of our EUA application and as a result the company is unable to give guidance on the timing of a decision by the FDA.
"We remain firm in our belief the results of our LIVE-AIR Phase 3 study warrant lenzilumab being granted emergency use authorization. The achievement of the primary endpoint for the overall patient population, and the recent supplemental subset analysis which showed significant response to treatment by Black and African-American patients in the study, support our view of the potential benefit lenzilumab could bring to patient care if authorization were to be granted," said Cameron Durrant, MD, Chief Executive Officer, Humanigen.
Timothy Morris, CFO and COO, Humanigen, noted, "While the review of the EUA application continues, we are preparing for potential launch in the U.S., and simultaneously working to complete, before the end of the third quarter 2021, the submission of the Marketing Authorization Application ("MAA") to the Medicines Healthcare products Regulatory Agency ("MHRA") in the U.K. We have initiated the MAA process to the European Medicines Agency ("EMA") and anticipate the appointment of rapporteurs in the near term."
Second Quarter and Recent Highlights:
Lenzilumab in hospitalized COVID-19
Submitted an application to the FDA for an EUA for lenzilumab for the treatment of patients hospitalized with COVID-19.
Initiated filing and received acknowledgement the UK submission for Marketing Authorization for lenzilumab in COVID-19 has been accepted for expedited COVID-related rolling review by the MHRA. The submission is expected to be completed by September 30, 2021.
Initiated the process to make a submission to the European Medicines Agency for Marketing Authorization of lenzilumab in COVID-19.
The company’s commercial partners in South Korea and the Philippines, KPM Tech and Telcon RF Pharmaceutical, received approval from South Korea’s Ministry of Food and Drug Safety, the South Korean equivalent of FDA, to conduct a Phase 1 clinical study of lenzilumab, to enable submission and potential approval in South Korea.
Announced analysis of results from our Phase 3 LIVE-AIR study of lenzilumab in hospitalized patients with COVID-19 suggesting Black and African-American patients having a CRP<150 mg/L may be the highest responders to treatment, with a nearly 9-fold increase in likelihood of survival without ventilation ("SWOV") [n=51, p-value=0.0418]. In the overall population with CRP<150 mg/L, LIVE-AIR Phase 3 results show patients treated with lenzilumab demonstrated a 2.5-fold increased likelihood of SWOV [mITT, n=351, p-value=0.0009].
Entered into manufacturing agreement with Chime Biologics to produce lenzilumab bulk drug substance and drug product to be sold, with requisite regulatory authorization, in regions outside the United States.
Corporate
Completed underwritten public offering of common stock, raising net proceeds of $94.2 million.
The company was added to the Russell 3000 Index in June 2021.
Ken Trbovich was appointed to the newly-created role of SVP Investor Relations.
ACTIV-5 Update
In August 2021, the National Institutes of Health ("NIH") announced the expansion of the Accelerating COVID-19 Therapeutic Interventions and Vaccines ("ACTIV-5") and Big Effect Trial, in the "B" arm of the trial ("BET-B"), referred to as ACTIV-5/BET-B. Following feedback from and consultation with the company, the NIH advanced the study to a Phase 2/3 study with target enrollment of at least 400 patients and amended the protocol for ACTIV-5/BET-B in a manner that aligns with the design of the company’s LIVE-AIR trial. As a result of the advancement to a Phase 2/3 and amended protocol, the company anticipates that ACTIV-5/BET-B may serve as a second confirmatory study required for submission to FDA as part of a Biologics License Application ("BLA") that the company would submit if the ACTIV-5/BET-B data further validate the benefits of lenzilumab in COVID-19 patients.
Second Quarter and Six Months Ended June 30, 2021 Financial Results
Net loss for the three months ended June 30, 2021 was $70.8 million or $1.20 per share as compared to $24.0 million or $0.79 per share for the three months ended June 30, 2020. The net loss for the six months ended June 30, 2021 was $136.4 million or $2.45 per share as compared to $26.5 million or $1.00 per share for the six months ended June 30, 2020. The increase in net loss for both periods was largely due to an increase in total expenses, mainly Research and Development ("R&D") expense which rose significantly as the company accelerated its efforts to manufacture lenzilumab for potential commercialization upon a regulatory authorization. R&D expense increased $41.9 million from $21.1 million for the three months ended June 30, 2020, to $63.0 million for the three months ended June 30, 2021, and increased $101.1 million from $21.8 million for the six months ended June 30, 2020, to $122.9 million for the six months ended June 30, 2021. The manufacturing expense included in R&D was $57.1 million for the second quarter of 2021 as compared to $17.1 million for the prior year quarter, and $107.1 million for the six months ended June 30, 2021, as compared to $17.4 million for the prior year period. The costs incurred to produce lenzilumab will continue to be included in R&D expense until lenzilumab is authorized or approved for commercial use, at which point the amounts expended for production would be reclassified as inventory. A meaningful portion of these expenses are associated with initiation of manufacturing processes on a site-by-site basis.
Cash and Cash Equivalents
Net cash used in operating activities, net of balance sheet changes, was $103.8 million for the six months ended June 30, 2021. During the same period, the company raised net proceeds of $36.1 million from the sale of shares of common stock under its At-the-Market offering program, drew the first tranche of $25.0 million under its credit facility with Hercules Capital, providing net proceeds of $24.4 million, and completed a public offering of common stock with net proceeds of $94.2 million. As of June 30, 2021, the company had cash and cash equivalents of $120.5 million. The company expects to continue to use its funds on the manufacturing of lenzilumab in anticipation of its potential commercialization under EUA in the US or conditional marketing authorization in the UK. For the third quarter of 2021 the company anticipates the R&D expense related to lenzilumab production will be same level as the second quarter of 2021. If an EUA or CMA for lenzilumab is not received in the third quarter of 2021, the company would seek to decrease its spending on lenzilumab production.
A summary of key financial highlights as of and for the three and six months ended June 30, 2021 and 2020 is as follows ($ in thousands):