On April 29, 2019 Mirati Therapeutics, Inc. (NASDAQ: MRTX), a clinical-stage targeted oncology company, reported financial results for the first quarter ended March 31, 2019 (Press release, Mirati, APR 29, 2019, View Source [SID1234535450]).

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First Quarter Highlights

January 7th, we announced a clinical collaboration with Bristol-Myers Squibb Company to evaluate the combination of sitravatinib and nivolumab (OPDIVO), in our planned Phase 3 clinical trial in second line NSCLC patients who have progressed following prior treatment. Mirati will sponsor and fund the clinical trial and Bristol-Myers Squibb will provide nivolumab at no cost.
January 15th, we announced that we had dosed the first patient in the Phase 1/2 clinical trial of MRTX849, a novel KRAS G12C inhibitor.
January 22nd, we announced the successful completion of a public offering of common stock that provided net cash proceeds of $107.9 million.
February 19th, we announced the appointment of Faheem Hasnain as Chairman of the Board of Directors.
"In the first quarter we made significant advances across our pipeline, including the dosing of the first patient with our KRAS G12C inhibitor, MRTX849. We also strengthened our operational and strategic capabilities, highlighted by a successful public offering and the appointment of Faheem Hasnain as Chairman of the Board," said Charles M. Baum, M.D., Ph.D., President and Chief Executive Officer. "Our clinical programs continue to advance, and we are on track for a second quarter initiation of the Phase 3 randomized trial of sitravatinib plus nivolumab, versus docetaxel, in second line non-small cell lung cancer (NSCLC). The Phase 1/2 clinical trial of our KRAS G12C inhibitor, MRTX849, is ongoing and enrollment is proceeding well. We will provide an initial clinical update on MRTX849 in the second half of 2019."

Financial Results for the First Quarter 2019

Cash, cash equivalents, and short-term investments were $301.0 million at March 31, 2019, compared to $222.8 million at December 31, 2018. In January 2019, we completed a public offering of common stock that provided net cash proceeds of $107.9 million.

License and collaboration revenues relate to the Collaboration and License Agreement between the Company and BeiGene, Ltd. ("BeiGene"), dated January 7, 2018. License and collaboration revenues for the first quarter of 2019 were $1.2 million and relate to revenues earned in connection with a manufacturing supply services agreement with BeiGene. License and collaboration revenues for the first quarter of 2018 were $9.5 million and relate to the license the Company granted to BeiGene under the Collaboration and License Agreement.

Research and development expenses for the first quarter of 2019 were $34.2 million, compared to $19.7 million for the same period in 2018. The increase in research and development expenses is due to an increase in expense associated with sitravatinib and MRTX849, as well as an increase in salaries and related expense, including an increase in share-based compensation expense. The increase in sitravatinib expense is due to increased costs to support the expansion of existing and new clinical trials, and the increase in MRTX849 expense relates to the Phase 1 clinical trial, which was initiated in the first quarter of 2019. The Company recognized research and development-related share-based compensation expense of $5.2 million during the first quarter of 2019, compared to $1.5 million for the same period in 2018.

General and administrative expenses for the first quarter of 2019 were $9.8 million, compared to $5.2 million for the same period in 2018. The increase is primarily due to an increase in share-based compensation expense due to an increase in the fair value of stock options granted during the three months ended March 31, 2019 compared to the same period in 2018. The Company recognized general and administrative-related share-based compensation expense of $5.9 million during the first quarter of 2019, compared to $2.2 million for the same period in 2018.

Net loss for the first quarter of 2019 was $40.9 million, or $1.17 per share basic and diluted, compared to net loss of $14.7 million, or $0.51 per share basic and diluted for the same period in 2018.

About Sitravatinib

Sitravatinib is a spectrum-selective kinase inhibitor that potently inhibits receptor tyrosine kinases (RTKs), including TAM family receptors (TYRO3, Axl, Mer), split family receptors (VEGFR2, KIT) and RET. As an immuno-oncology agent, sitravatinib is being evaluated in combination with nivolumab (OPDIVO), an anti-PD-1 checkpoint inhibitor, in patients whose cancers have progressed despite treatment with a checkpoint inhibitor. Sitravatinib’s potent inhibition of TAM and split family RTKs may overcome resistance to checkpoint inhibitor therapy through targeted reversal of an immunosuppressive tumor microenvironment, enhancing antigen-specific T cell response and expanding dendritic cell-dependent antigen presentation.

Sitravatinib is also being evaluated as a single agent in a Phase 1b expansion clinical trial emphasizing enrollment of patients whose tumors harbor specific mutations in the CBL protein. When CBL is inactivated by mutation, multiple RTKs, including TAM, VEGFR2 and KIT, are dysregulated and may act as oncogenic tumor drivers in NSCLC and melanoma. Sitravatinib potently inhibits these RTKs and is being investigated as a treatment option for cancer patients with CBL mutations.

About MRTX849

MRTX849 is an investigational, orally-available small molecule that is designed to potently and selectively inhibit a form of KRAS which harbors a substitution mutation (G12C). KRAS G12C mutations are present in approximately 14% of NSCLC adenocarcinoma patients, 4% of colorectal cancer patients, and subsets of other types of cancer. Tumors characterized by KRAS G12C mutations are commonly associated with poor prognosis and resistance to therapy, and patients with these mutations have few treatment options. MRTX849 is being evaluated in a Phase 1/2 trial treating patients with molecularly-identified, KRAS G12C-positive advanced solid tumors.