Abeona Therapeutics Reports Fourth Quarter and Full Year 2019 Financial Results and Business Updates

On March 16, 2020 Abeona Therapeutics Inc. (Nasdaq: ABEO), a fully-integrated leader in gene and cell therapy, reported fourth quarter and full year 2019 financial results, as well as business updates, which will be discussed on a conference call scheduled for Tuesday, March 17 at 10:00 a.m. ET (Press release, Abeona Therapeutics, MAR 16, 2020, View Source [SID1234555592]). Interested parties are invited to participate in the call by dialing 844-369-8770 (domestic) or 862-298-0840 (international) or via webcast at View Source

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We have started 2020 strongly by opening enrollment in the pivotal Phase 3 VIITALTM study evaluating EB-101 for RDEB and we remain on track to dose the first patient in the first quarter," said João Siffert, M.D., Chief Executive Officer of Abeona. "A majority of study participants have been pre-screened and interest from the RDEB community has been high. The recently published long-term follow-up data leave us confident that VIITALTM will demonstrate EB-101 has the unique potential to durably heal the most challenging large and chronic wounds faced by RDEB patients."

Dr. Siffert continued, "We have also made great strides in our MPS III gene therapy programs. Positive interim data from the ongoing Phase 1/2 Transpher A study demonstrated that ABO-102 preserved neurocognitive skills up to two years after treatment in MPS IIIA patients treated early in life. In MPS IIIB, dose-dependent and sustained reductions in disease-specific biomarkers demonstrated a clear biologic effect of ABO-101 treatment in the Phase 1/2 Transpher B study, which is now enrolling a third dose cohort. Finally, our $103.5 million gross underwritten public offering fully funds operations well into 2021 and enables the continued progress and momentum across our robust clinical pipeline."

Fourth Quarter and Recent Highlights

Opening of enrollment in the Phase 3 VIITALTM study evaluating EB-101 for RDEB, which is on track to treat the first patient in Q1. The majority of study participants have been pre-screened and preparations for an additional clinical site initiation are ongoing.

Presentation of positive interim data from ABO-102 gene therapy program in MPS IIIA at WORLDSymposium:

●Three young patients treated in high-dose cohort 3 (at ages 27 months, 19 months, and 12 months) continued to show preserved neurocognitive skills 18 months to two years post treatment, compared with natural history.

●Across all cohorts (n=14), biomarker improvements included rapid and sustained, dose-related reductions in CSF-HS that reached lower limit of quantitation in Cohort 3 (n=2); a reduction in plasma HS levels; and a durable, dose-dependent reduction in liver volume with up to 2 years of follow up.

●ABO-102 has been well-tolerated, with long-term safety remaining favorable 15-45 months post treatment. There have been no treatment-related severe adverse events and no clinically-significant adverse events reported.

Presentation of positive interim data from ABO-101 gene therapy program in MPS IIIB at WORLDSymposium:

●Initial improvements in multiple disease-specific biomarkers including decreased cerebrospinal fluid heparan sulfate (HS) levels, reduced plasma and urine HS and glycosaminoglycans, reduced liver volume.

●ABO-101 has been well-tolerated to date, with no treatment-related severe adverse events and no clinically-significant adverse events reported (n=8).

Completion of cohort 2 and enrollment in cohort 3 of the ABO-101 Transpher B study in MPS IIIB.

Closing of $103.5 million underwritten public offering strengthening balance sheet to support the VIITALTM study through data readouts and the advancement of additional clinical programs.

Receipt of EMA PRIME designation for ABO-102 program in MPS IIIA.

Issuance of two U.S. Patents for AIM AAV capsids.

Completion of strategic review.

Fourth Quarter and Full Year Summary Financial Results

Cash, cash equivalents and marketable securities as of December 31, 2019 were $129.3 million, compared to $47.9 million as of September 30, 2019. The increase in cash of $81.4 million was driven primarily by $103.5 million gross underwritten public offering.

Net loss was $0.30 per share for the fourth quarter of 2019, compared to $0.36 per share in the comparable period in 2018. For the twelve months ended December 31, 2019, net loss was $1.51 per share compared to $1.19 per share in the same period in 2018.

Galectin Therapeutics Reports Fiscal 2019 Financial Results and Provides Business Update

On March 16, 2020 Galectin Therapeutics Inc. (NASDAQ: GALT), the leading developer of therapeutics that target galectin proteins, reported financial results and provided a business update for the year ended December 31, 2019 (Press release, Galectin Therapeutics, MAR 16, 2020, View Source [SID1234555580]). These results are included in the Company’s Annual Report on Form 10-K, which has been filed with the U.S. Securities and Exchange Commission and is available at www.sec.gov.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Harold H. Shlevin, Ph.D., President and Chief Executive Officer of Galectin Therapeutics, said, "The focus of the past few months has been on finalizing the refinements to our planned NASH-RX trial based on feedback from the U.S. Food and Drug Administration (FDA). Our Adaptive-Designed Phase 2b/3 trial protocol is nearly complete, and we anticipate initiating the trial in the second quarter of 2020. We have been very successful working with our partners to modify our initial trial design, incorporating a new biostatistics element to verify the rate of varices development and accordingly adjust trial sizing to help assure a key assumption related to the rate of varices development is met. Most recently, we strengthened our executive team with the addition of Dr. Pol F. Boudes, a Chief Medical Officer who has experience running NASH drug trials. In addition, as a result of the modifications to our trial, our clinical research organization Covance has been able to identify additional international clinical trial sites. Drug manufacturing capacity has been established to meet the needs of the entire trial. Belapectin (formerly known as GR-MD-02) is the first drug that has been shown to prevent the development of esophageal varices in patients with compensated NASH cirrhosis. If confirmed, these results would constitute a significant benefit for patients."

Richard E. Uihlein, Chairman of the Board, added, "I am extremely pleased with the progress achieved over the past few months. We are now in the final stages of finalizing our NASH-RX trial, which improves the likelihood of showing belapectin’s effects. And, with the recent addition of Dr. Boudes as Chief Medical Officer, we have a strong executive with extensive experience conducting trials of this nature. As always, our goal is to provide a therapy for the growing NASH epidemic around the world."

NASH-RX Trial Update

The NASH-RX trial is planned to use an adaptive design, confirm dose selection and reaffirm the efficacy data observed in the NASH-CX trial and, with pre-planned adaptations, inform the larger Phase 3 trial component. The adaptive design being considered allows pre-planned adjustments of the trial that may include, amongst other factors, optimization of dose selection, confirmation of efficacy and proof of concept observed in the NASH-CX trial, optimized sizing and statistical powering of the Phase 3 component, and possible inclusion of more advanced cirrhotic patients. We believe that these adaptations taken together should optimize conduct of the NASH-RX trial giving belapectin (GR-MD-02) the best opportunity to show a positive therapeutic effect. If the results of the NASH-RX trial are compelling, there could be the potential for accelerated FDA approval and/or partnership opportunity with a large pharmaceutical company.

The trial protocol is based on feedback from several interactions with the FDA during the last few months of 2019, including the November 14, 2019, telephone conference which included the FDA and Company representatives along with its co-primary investigators, biostatistical experts and other experts at Covance. In this meeting, the FDA indicated the new design was reasonable (subject to review of the protocol), and FDA indicated that they were still supportive of the surrogate end-point concepts originally proposed.

We believe the study design potentially could improve the likelihood of showing drug efficacy because:

It clarifies and reaffirms NASH-CX efficacy and safety at two distinct drug doses supported by robust pharmacokinetic analysis

It provides for appropriate selection of optimal dose – e.g., single dose (2 or 4 mg/kg) for Phase 3 component

A separate Hepatic Impairment study may allow inclusion of more severe patients who are believed to have a much higher rate of esophageal varices progression and bleeding and other decompensating events

Reduced frequency of esophagogastroduodenoscopys (EGD), elimination of biopsy endpoints and elimination of hepatic venous pressure gradient (HVPG) testing may make it easier to enroll trial patients and retain these patients during the duration of the trial.

Adaptation to size and power calculations based on sample size re-estimation and the interim analysis will allow better estimates of Phase 3 cohort sizing and of statistical power

A planned interim analysis after 18 months of completed treatment will assess affirmation of Phase 2 efficacy and safety results, help select a single optimal dosage, and inform the Phase 3 stage of the study, including its size.

In the Phase 3 component of this trial, the primary endpoint is development of new esophageal varices. Patients already enrolled for the Phase 2b component of the trial will continue on the selected single dose into the Phase 3 component of the trial. Patient selection for both Phase 2b and 3 components will be based on routine clinical signs of portal hypertension, including, amongst others, the presence or absence of varices, depressed platelet count (thrombocytopenia), enlargement of the spleen size and evidence of collateral blood vessels by imaging. The current study design and protocol are subject to modification after review by FDA.

The focus and goal of the therapeutic program is to prevent the development of large esophageal varices, which are strongly correlated with patient mortality due to sudden and severe bleeding. Based on the results of the NASH-CX trial, the clinical program will focus on patients who are at increased risk of developing varices, i.e. patients who have clinical signs of portal hypertension, such as low platelet counts or increased spleen size (splenomegaly).

The key milestones and associated target dates for the NASH-RX trial will be announced as elements of design of the trial are finalized based on the recent FDA feedback. However, we currently expect the first patient to be initiated in the second quarter of 2020. The study overall will likely involve approximately 130 sites in 11 countries in North America, Europe, Asia, and Australia.

Other Updates

Announced that Pol F. Boudes, M.D. has been appointed Chief Medical Officer – a key development for the company as it nears launch of its NASH-RX trial, an adaptively-designed Phase 3 trial in NASH cirrhosis. Dr. Boudes’ diverse background in drug development, especially his experience in NASH and other liver diseases, bolsters Galectin’s global advanced clinical development of belapectin for NASH cirrhosis.

Peer-reviewed publication, Scientific Presentations and Conferences

Gastroenterology, a prominent journal in the field of gastrointestinal disease, published a peer reviewed paper titled, "Effects of Belapectin, an Inhibitor of Galectin-3, in Patients with Nonalcoholic Steatohepatitis with Cirrhosis and Portal Hypertension," highlighting the potential prevention of esophageal varices of its NASH-CX Phase 2 clinical trial in NASH cirrhosis. We were greatly honored that such a prestigious, peer-reviewed publication felt the quality of our science merited the industry-wide attention they provide.

Initial results of the efforts at Galectin Sciences LLC (our majority-owned subsidiary) were presented by Dr. E. Zomer, Ph.D., Vice President, Discovery Research and Product Development, at the 3rd Annual Anti-Fibrotic Drug Development (AFDD) Summit regarding Galectin’s discovery program of its next generation of oral galectin-3 inhibitors. The presentation entitled "Therapeutic Integrin Inhibition," discussed the next generation of galectin-3 inhibitors, as well as the discovery of functional allosteric inhibitors.

Financial Results

For the year ended December 31, 2019, the Company reported a net loss applicable to common stockholders of $13.6 million, or ($0.26) per share, compared to a net loss applicable to common stockholders of $15.0 million, or ($0.38) per share for the full year 2018. The decrease is largely due a decrease in general and administrative, primarily stock-based compensation, and preferred stock dividends, somewhat offset by an increase in research and development expense.

Research and development expense for 2019 was $7.5 million compared with $6.5 million for 2018. The increase was primarily due to costs related to our NASH-RX clinical trial planning and site start-up and qualification processes globally, along with preparations and some preclinical activities incurred in support of the planned clinical program, such as development and reproductive toxicity studies, clinical supplies and other supportive activities, somewhat offset by lower non-cash stock compensation expenses. General and administrative expenses for 2019 were $6.0 million, down from $7.1 million for the full year 2018, primarily due to a decrease in non-cash stock-based compensation expenses.

As of December 31, 2019, the Company had $47.5 million of cash and cash equivalents. During 2019, the company effected a Rights Offering which, together with other common stock and warrants issued, raised $50.5 million in net proceeds. The Company also has a $10 million unsecured line of credit, under which no borrowings have been made to date. The Company believes it has sufficient cash, including availability under the line of credit, to fund currently planned operations and research and development activities through at least September 30, 2021.

The Company expects that it will require more cash to fund operations after September 30, 2021 and believes it will be able to obtain additional financing as needed. The total cost to obtain the interim efficacy data of the planned trial, including general overhead, is currently estimated to be approximately $125 million; however, the costs and timing of such trial are not yet completely finalized. These costs will require additional funding. There can be no assurance that we will be successful in obtaining financing to support our operations beyond September 30, 2021, or, if available, that any such financing will be on terms acceptable to us.

Zai Lab Announces Acceptance of sNDA Submission of ZEJULA® (Niraparib) for First-Line Maintenance Treatment of Ovarian Cancer in China by the NMPA

On March 16, 2020 Zai Lab Limited (NASDAQ: ZLAB), a China and U.S.-based innovative commercial stage biopharmaceutical company, reported the China National Medical Products Administration (NMPA) has accepted its supplemental New Drug Application (sNDA) for ZEJULA (niraparib) as a maintenance treatment of adult patients with advanced epithelial ovarian, fallopian tube, or primary peritoneal cancer who are in a complete or partial response to first-line platinum-based chemotherapy (Press release, Zai Laboratory, MAR 16, 2020, View Source [SID1234555578]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We believe ZEJULA is a potential best-in-class PARP inhibitor due to its compelling efficacy, once-daily dosing and superior pharmacokinetic properties including its ability to cross the blood brain barrier," said Dr. Samantha Du, Founder and Chief Executive Officer of Zai Lab. "The NMPA’s acceptance of our sNDA submission for ZEJULA as a first-line monotherapy treatment after surgery and platinum-based chemotherapy has the potential to both fundamentally change how women with ovarian cancer are treated in China and significantly expand ZEJULA’s market opportunity. Zai Lab remains committed to make a meaningful impact on the way cancer is treated in China and globally, and we plan to continue to develop and bring many new and innovative treatment options to patients in need."

The PRIMA study conducted by our partner GlaxoSmithKline plc (GSK) demonstrated that ZEJULA treatment resulted in a 38% reduction in the risk of disease progression or death in the overall study population when compared to placebo. ZEJULA also demonstrated benefits in all patient subgroups. For patients whose cancer is associated with homologous recombination deficiency (HRD) positive status, ZEJULA treatment resulted in a 57% reduction in the risk of disease progression or death.

GSK submitted a sNDA to the U.S. FDA for the use of ZEJULA in ovarian cancer as first-line maintenance treatment based on the PRIMA study, and the application was accepted in February 2020 and is being reviewed under the Real-Time Oncology Review (RTOR) pilot program.

About Ovarian Cancer

Ovarian cancer is one of the most common gynecologic cancers in China with more than 52,000 newly diagnosed cases and 23,000 deaths each year. While platinum-based chemotherapy is effective at inducing an initial response in ovarian cancer, the disease will recur in the majority of women. New agents that prolong the duration of response following platinum-based treatment and delay the inevitable relapse of ovarian cancer will benefit patients with ovarian cancer in China.

About ZEJULA (niraparib)

ZEJULA (niraparib) is indicated as monotherapy for the maintenance treatment of adult patients with platinum-sensitive relapsed high grade serous epithelial ovarian, fallopian tube, or primary peritoneal cancer who are in response (complete or partial) to platinum-based chemotherapy. The NMPA recently accepted Zai Lab’s sNDA for niraparib is a monotherapy maintenance treatment in adult patients with advanced epithelial ovarian, fallopian tube, or primary peritoneal cancer who are in a complete or partial response to first-line platinum-based chemotherapy.

Zai Lab has ongoing pivotal studies in Chinese patients for first-line and second-line maintenance therapies in ovarian cancer. Zai Lab also conducted a Phase 1 pharmacokinetic (PK) study of niraparib in Chinese patients with ovarian cancer. This study was published in August 2019 in The Oncologist and demonstrated that the PK profile of niraparib in Chinese patients were comparable to that of patients evaluated in ZEJULA’s global PK study.

Zai Lab in-licensed rights to ZEJULA from GSK for Mainland China, Hong Kong and Macau. The NDA for recurrent ovarian cancer was accepted by the NMPA on December 12, 2018, granted priority review status on January 29, 2019 and approved on December 27, 2019. Zai Lab has obtained approvals to market ZEJULA in Mainland China, Hong Kong and Macau for maintenance therapy in patients with platinum-sensitive, recurrent ovarian cancer.

Since the Hong Kong launch of ZEJULA in October 2018, it has rapidly gained market share in the region despite being launched more than two years behind Lynparza. Based on IQVIA (formerly IMS) data, ZEJULA is now the market leading PARP inhibitor with market share in Hong Kong of 71% for the full year ended December 31, 2019.

Sesen Bio Reports Fourth Quarter and Full-Year 2019 Financial Results

On March 16, 2020 Sesen Bio (Nasdaq: SESN), a late-stage clinical company developing targeted fusion protein therapeutics for the treatment of patients with cancer, reported operating results for the fourth quarter and full-year ended December 31, 2019 (Press release, Sesen Bio, MAR 16, 2020, View Source [SID1234555577]). The Company also provided an update highlighting regulatory progress and the commercial opportunity of Vicinium for the treatment of patients with high-risk non-muscle invasive bladder cancer (NMIBC).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"2019 was a year of tremendous progress for Sesen Bio in every way, but especially in terms of our regulatory progress," said Dr. Thomas Cannell, president and chief executive officer of Sesen Bio. "After four pivotal meetings with the FDA and the initiation of our BLA submission in 2019, we now turn our focus to finalizing the BLA for Vicinium and transforming into a commercial-ready organization in 2020. We believe Vicinium is a highly differentiated product candidate with a unique mechanism of action and clinical profile. We look forward to continuing our collaborative relationship with the FDA as we work to bring this important product to patients."

Regulatory Update

Initiation of Vicinium BLA Submission of clinical and non-clinical data
On December 6, 2019, the Company initiated the BLA submission for Vicinium under Rolling Review to the FDA. The initial submission included the completed non-clinical and clinical modules, and a partially completed Module 3 which details Chemistry, Manufacturing and Controls (CMC).
Anticipated completion of BLA submission in second half of 2020 with potential approval in first half of 2021. As part of finalizing Module 3, the Company anticipates completing three commercial-scale process performance qualification manufacturing runs for both bulk drug substance and drug product in the summer of 2020. The associated quality release testing results and master validation report will then be incorporated into Module 3, along with additional characterization testing and stability data to support the demonstration of analytical comparability between clinical and commercial drug supply. The Company anticipates submitting this information to the FDA in the second half of 2020 to complete the BLA submission. If the FDA accepts the BLA filing, the Company plans to request a Priority Review.
Commercial Opportunity

Early commercial launch planning underway
New market research supports large commercial opportunity. In the first quarter of 2020, the Company conducted 30-minute interviews with 34 high-prescribing urologists to assess their views of a blinded clinical profile of Vicinium as well as an unblinded profile of Keytruda, which was recently approved by the FDA for BCG-unresponsive NMIBC patients with carcinoma in situ (CIS). Overall, these urologists indicated that Vicinium would be the preferred treatment modality in the majority of their patients in comparison to Keytruda and radical cystectomy. We believe this favorable response from urologists is due not only to the distinct mechanism of action and strong efficacy and safety profile of Vicinium, but also to its mode of administration and ease of adoption into clinical practice, which may provide continuity of care for patients and urologists.
Fourth Quarter and Full-Year 2019 Financial Results

Cash Position: Cash and cash equivalents were $48.1 million as of December 31, 2019, compared to $50.4 million as of December 31, 2018.
R&D Expenses: Research and development expenses for the fourth quarter of 2019 were $5.4 million compared to $4.7 million for the same period in 2018. For the year ended December 31, 2019, research and development expenses were $24.7 million compared to $14.1 million for the same period in 2018. The fourth quarter and annual increases were due primarily to costs related to the ongoing technology transfer process as we scale-up for commercial manufacturing and increased regulatory, internal and external staffing costs, partially offset by reduced expenses related to the Phase 3 VISTA trial for Vicinium.
G&A Expenses: General and administrative expenses for the fourth quarter of 2019 were $3.3 million compared to $3.5 million for the same period in 2018. For the year ended December 31, 2019, general and administrative expenses were $12.2 million compared to $11.6 million for the same period in 2018. The fourth quarter decrease was due primarily to decreases in market research expense, public relations expense and external legal fees, partially offset by increases in internal staffing costs and professional and audit fees. The annual increase was due primarily to increases in internal staffing costs, professional and audit fees, partially offset by lower external legal fees and commercial expenses.
Net Loss: Net loss was $33.6 million, or $0.32 per share, for the fourth quarter of 2019, compared to $6.8 million, or $0.09 per share, for the same period in 2018. For the year ended December 31, 2019, net loss was $107.5 million, or $1.18 per share, compared to $33.7 million, or $0.55 per share, for the same period in 2018. The fourth quarter and annual increases were due primarily to a higher non-cash change in the fair value of contingent consideration and the higher research and development expenses described above.
About the VISTA Clinical Trial
The VISTA trial is an open-label, multicenter, single-arm Phase 3 clinical trial evaluating the efficacy and tolerability of Vicinium as a monotherapy in patients with high-risk, bacillus Calmette-Guérin (BCG) unresponsive non-muscle invasive bladder cancer (NMIBC). The primary endpoints of the trial are the complete response rate and the duration of response in patients with carcinoma in situ with or without papillary disease. Patients in the trial received locally administered Vicinium twice a week for six weeks, followed by once-weekly treatment for another six weeks, then treatment every other week for up to two years. To learn more about the Phase 3 VISTA trial, please visit www.clinicaltrials.gov and search the identifier NCT02449239.

About Vicinium
Vicinium, a locally administered fusion protein, is Sesen Bio’s lead product candidate being developed for the treatment of high-risk non-muscle invasive bladder cancer (NMIBC). Vicinium is comprised of a recombinant fusion protein that targets epithelial cell adhesion molecule (EpCAM) antigens on the surface of tumor cells to deliver a potent protein payload, Pseudomonas Exotoxin A. Vicinium is constructed with a stable, genetically engineered peptide tether to ensure the payload remains attached until it is internalized by the cancer cell, which is believed to decrease the risk of toxicity to healthy tissues, thereby improving its safety. In prior clinical trials conducted by Sesen Bio, EpCAM has been shown to be overexpressed in NMIBC cells with minimal to no EpCAM expression observed on normal bladder cells. Sesen Bio is currently conducting the Phase 3 VISTA trial, designed to support the registration of Vicinium for the treatment of high-risk NMIBC in patients who have previously received a minimum of two courses of bacillus Calmette-Guérin (BCG) and whose disease is now BCG-unresponsive. Additionally, Sesen Bio believes that cancer cell-killing properties of Vicinium promote an anti-tumor immune response that may potentially combine well with immuno-oncology drugs, such as checkpoint inhibitors. The activity of Vicinium in BCG-unresponsive NMIBC is also being explored at the US National Cancer Institute in combination with AstraZeneca’s immune checkpoint inhibitor durvalumab.

Sutro Biopharma Reports Full Year 2019 Financial Results and Recent Business Highlights and Developments

On March 16, 2020 Sutro Biopharma, Inc. (NASDAQ: STRO), a clinical-stage drug discovery, development and manufacturing company focused on the application of precise protein engineering and rational design to create next-generation oncology therapeutics, reported its financial results for the year ended December 31, 2019 and provided a preview of its planned activities for 2020 (Press release, Sutro Biopharma, MAR 16, 2020, View Source [SID1234555576]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We were looking forward to sharing updated safety and efficacy data from our Phase 1 trial for STRO-002 during the AACR (Free AACR Whitepaper) Annual Meeting 2020 as a follow up to the encouraging interim safety data we presented at the AACR (Free AACR Whitepaper)-NCI-EORTC Molecular Targets and Cancer Therapeutics Conference in late October 2019," said Bill Newell, Sutro’s Chief Executive Officer. "With the cancellation of the AACR (Free AACR Whitepaper) meeting, we are considering alternative opportunities to present these data in the second quarter. STRO-002 and STRO-001 are our two proprietary antibody drug conjugate (ADC) product candidates progressing in Phase 1 clinical trials. Additionally, each of our three current collaborations has yielded novel oncology product candidates in three distinct therapeutic protein formats that are either in clinical development or in the late stages of preclinical development. All of these candidates are based on our proprietary and integrated cell-free protein synthesis platform XpressCF and site-specific conjugation platform XpressCF+, which allows us to rapidly and precisely create optimally designed, next-generation protein therapeutics candidates."

Recent Business Highlights and Developments

STRO-002 Clinical Program

STRO-002 is a potential best-in-class ADC directed against folate receptor-alpha (FolRα), which is highly expressed in ovarian cancer.
Phase 1 dose-escalation, with dose expansion, clinical trial that is enrolling women with advanced ovarian and endometrial cancers, had initial safety and efficacy data presented at the AACR (Free AACR Whitepaper)-NCI-EORTC Molecular Targets and Cancer Therapeutics Conference on October 29, 2019.
Based on the reported data to date in heavily pre-treated patients who have not been pre-selected based on FolRα expression levels, STRO-002 has been generally well-tolerated. No ocular toxicity signals have been observed, with no patients receiving prophylactic corticosteroid eye drops.
Dose escalation in the Phase 1 trial is continuing and the maximum tolerated dose has not yet been reached.
Additional Phase 1 dose-escalation phase safety and efficacy data was accepted as a late-breaking abstract to be presented at the AACR (Free AACR Whitepaper) Annual Meeting, which was cancelled recently. We plan to release updated data in the second quarter of 2020.
Phase 1 dose expansion trial is expected to begin enrolling patients in the second half of 2020.
STRO-001 Clinical Program

STRO-001 is a potential first-in-class and best-in-class ADC directed against CD74, which is highly expressed in many B cell malignancies.
Phase 1 dose-escalation, with dose expansion, clinical trial that is enrolling patients with multiple myeloma and non-Hodgkin lymphoma, had initial safety data presented at the EHA (Free EHA Whitepaper) Congress in June 2019. A safety data update that included several additional patients was released in an abstract in association with the American Society of Hematology (ASH) (Free ASH Whitepaper) Conference on November 6, 2019.
Based on the reported data to date in heavily pre-treated patients, STRO-001 has been generally well-tolerated and no ocular toxicity signals have been observed, with no patients receiving prophylactic corticosteroid eye drops.
Dose escalation in the Phase 1 trial is continuing and the maximum tolerated dose has not yet been reached.
Additional Phase 1 dose-escalation phase safety and efficacy data is expected in the second half of 2020.
Phase 1 dose expansion trial is expected to begin enrolling patients in the first half of 2021.
Cytokine-Derivative Programs (Collaboration with Merck & Co.)

Sutro is collaborating with Merck on two research programs to discover new therapeutics for cancer and autoimmune diseases. Merck has the right to nominate a third program under this collaboration.
In March 2020, Merck extended by one year the research term of the collaboration’s first program, which includes a payment to Sutro. The collaboration is advancing Sutro’s novel cytokine-derivative product candidate towards IND-enabling studies.
BCMA ADC Clinical Program (Collaboration with Bristol Myers Squibb; formerly Celgene)

BMS received FDA clearance on its IND application for CC-99712, a novel ADC therapeutic targeting B-cell maturation antigen (BCMA), for the treatment of multiple myeloma in the second quarter of 2019.
BMS is currently enrolling patients in a Phase 1 trial focused on patients with relapsed and refractory multiple myeloma.
BMS will be responsible for the worldwide clinical development and commercialization of CC-99712. Sutro is entitled to development and regulatory milestone payments and tiered royalties ranging from mid to high single digit percentages from BMS.
Bispecific ADC Clinical Development Candidate (Collaboration with EMD Serono)

In the third quarter of 2019, EMD Serono designated an undisclosed bispecific ADC as a clinical development candidate with approval to advance to IND-enabling studies, which triggered a financial milestone received by Sutro.
Sutro will manufacture the bispecific ADC for the early clinical supply of the candidate and is eligible for further milestones and royalties. EMD Serono will be responsible for the drug product, clinical development and commercialization of this clinical development candidate.
24-Valent Pneumococcal Conjugate Vaccine (SutroVax Relationship)

Under a license from Sutro, SutroVax has right to use the XpressCF and XpressCF+ platforms to discover and develop vaccine candidates for the treatment or prophylaxis of infectious diseases.
SutroVax is progressing their broader spectrum pneumococcal conjugate vaccine (SVX-24) through the late stages of preclinical development and is targeting an IND filing for 2021.
SutroVax is responsible for performing all research and development activities while Sutro provides technical support and supplies XtractCF and other materials to SutroVax under a supply agreement.
Sutro is eligible to receive four percent (4%) royalties on worldwide net sales of any licensed vaccine candidates for human health use. Also, Sutro retains the right to discover and develop vaccines for treatment or prophylaxis of any disease not caused by an infectious pathogen, including cancer.
Sutro Unveiled Innovative Cancer Therapy Approach Using Precise Tumor Targeted Immunostimulant ADCs at World ADC London

On March 4 at the World ADC London meeting, Sutro announced it has expanded its ADC technology platform to include tumor targeting immunostimulant ADCs, or IADCs.
Sutro’s XpressCF+ Platform has enabled a groundbreaking technology to engineer homogeneous, dually conjugated ADCs with both immunostimulant and cytotoxic warheads on a single ADC molecule.
Sutro’s novel IADCs are designed to deliver two different drugs directly to the tumor, and not only kill tumor cells but also locally prime an immune response to the patient’s particular tumor cells. Sutro believes that its IADC approach creates a new therapeutic opportunity by combining the best features of an ADC with the biology of a personalized vaccine.
Full 2019 Financial Highlights

Cash, Cash Equivalents and Marketable Securities

As of December 31, 2019, Sutro had cash, cash equivalents and marketable securities of $133.5 million, as compared to $204.5 million as of December 31, 2018, which represents net cash usage of $16.9 million and $71.0 million during the fourth quarter and year ended December 31, 2019, respectively.

On February 28, 2020, Sutro entered into a loan and security agreement, under which Sutro borrowed $25.0 million, with approximately $9.6 million of such amount used to repay the outstanding principal, interest and final payment fees under a prior loan with the same lenders.

Revenue

Revenue was $42.7 million for the year ended December 31, 2019, compared to $38.4 million for 2018, principally related to the Merck, BMS, and EMD Serono collaborations. On January 1, 2019, Sutro adopted Accounting Standards Update No. 2014-09 Revenue from Contracts with Customers (Accounting Standards Codification Topic 606). For more information on the impact of the adoption of the new revenue standard, see "Notes to Financial Statements" contained in Part II, Item 8 of Sutro’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 16, 2020. Future collaboration revenue from Merck, BMS, and EMD Serono, and from any future collaboration partners, will fluctuate as a result of the amount and timing of revenue recognition of upfront, milestones and other collaboration agreement payments.

Operating Expenses

Total operating expenses for the year ended December 31, 2019, were $98.2 million, compared to $75.6 million in 2018, including non-cash stock-based compensation of $10.3 million and $2.9 million, and depreciation and amortization expense of $4.8 million and $4.5 million, in 2019 and 2018, respectively. Total operating expenses for 2019 were comprised of research and development expenses of $65.6 million and general and administrative expenses of $32.6 million, with both expense types expected to increase in 2020 as Sutro’s internal product candidates advance in clinical development and additional general and administrative expenses are incurred as a public company.