On November 9, 2023 Aptose Biosciences Inc. ("Aptose" or the "Company") (NASDAQ: APTO, TSX: APS), a clinical-stage precision oncology company developing highly differentiated oral targeted agents to treat hematologic malignancies, reported its financial results for the three months and nine months ended September 30, 2023, and provided a corporate update (Press release, Aptose Biosciences, NOV 9, 2023, View Source [SID1234637352]).

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"The data we presented last week during the European School of Haematology (ESH) conference on acute myeloid leukemia (AML) demonstrate the exciting potential for tuspetinib (TUS) in the treatment of the very ill relapsed/refractory AML population and as part of a frontline triplet combination regimen in newly diagnosed AML," said William G. Rice, Ph.D., Chairman, President and Chief Executive Officer. "Investigator enthusiasm for our tuspetinib/venetoclax (TUS/VEN) doublet has led to brisk enrollment in the APTIVATE trial. The number of evaluable patients and clinical responses continue to grow, and we look forward to reporting the next data set just a few weeks from now during the American Society of Hematology (ASH) (Free ASH Whitepaper) meeting."

Key Corporate Highlights

Tuspetinib APTIVATE Expansion Trial Ongoing – Tuspetinib, a once daily oral agent with a unique kinase targeting pattern, is being developed for the treatment of patients with R/R AML. As reported at ESH, more than 140 patients have been treated in the ongoing APTIVATE Phase 1/2 clinical trial: 91 patients have received TUS as a single agent; 51 thus far have been treated in the TUS/VEN cohort, with keen investigator interest accelerating patient enrollment in the doublet arm. In the most recent data cut (October 23, 2023), the favorable safety profile remained consistent for TUS and TUS/VEN treated R/R AML patients. TUS avoids many typical toxicities observed with other kinase, IDH1/2, and menin inhibitors.

Tuspetinib Single Agent Active with Favorable Safety – As reported at ESH, tuspetinib as a single agent was well-tolerated and highly active among relapsed or refractory (R/R) AML patients with a diversity of adverse genotypes. TUS single agent delivered 42% and 60% CR/CRh response rates across all patients and across FLT3-mutated patients, respectively, among evaluable VEN-naïve patients at the 80mg daily recommended phase 2 dose (RP2D). Tuspetinib demonstrated a 29% CR/CRh rate in VEN-naïve FLT3 unmutated (wildtype) AML at 80 mg daily RP2D, unlocking the potential for TUS to treat the additional 70-75% of the AML population without FLT3-mutation not currently addressed by any approved tyrosine kinase inhibitors. Tuspetinib single agent response rates compared favorably to the marketed FLT3 inhibitor gilteritinib, which has not demonstrated meaningful activity in FLT3 unmutated AML.

TUS/VEN Doublet Delivers Responses in Tough to Treat Populations – As reported in the ESH update from a data cut taken on October 23, 2023, the TUS/VEN doublet showed a 48% overall response rate (ORR) in 31 evaluable patients (15 of 31). 81% of those patients had previously failed VEN treatment, representing an increasing AML population in need of improved salvage therapies, and TUS/VEN had a 44% ORR in those VEN failure patients. TUS/VEN showed a 60% ORR (6 of 10) in FLT3-mutant AML, and a 43% (9 of 21) ORR in FLT3-wildtype AML. Analyses from the October 23rd data cut included preliminary data from patients very early in their treatment who may see their responses to treatment mature over time.

TUS Targets VEN Resistance Mechanisms; ESH Poster Presentation – Aptose presented a poster at ESH, Tuspetinib Oral Myeloid Kinase Inhibitor Creates Synthetic Lethal Vulnerability to Venetoclax, demonstrating the ability of TUS to suppress a set of key oncogenic signaling pathways that mediate resistance to AML drugs by potently inhibiting SYK, mutated and unmutated forms of FLT3, JAK1/2, RSK2, mutant forms of KIT, and TAK1-TAB1 kinases. Aptose researchers investigated the effects of TUS on key elements of the phospho-kinome and apoptotic proteome in both parental and TUS-resistant AML cells. In parental cells, TUS acutely inhibits key oncogenic signaling pathways and shifts the balance of pro- and anti-apoptotic proteins in favor of apoptosis, suggesting that it may generate vulnerability to VEN. Indeed, acquired TUS resistance generated a synthetic lethal vulnerability to VEN of unusually high magnitude, making cells more than 2,000 times more sensitive to VEN. Concurrent administration of TUS and VEN may eliminate cells that carry this form of TUS resistance at the start of therapy and discourage the emergence of TUS resistance during treatment.

Tuspetinib Clinical Data Selected for Oral Presentation at 2023 ASH (Free ASH Whitepaper) Annual Meeting – Aptose announced last week that clinical data for tuspetinib was selected for oral presentation at the 65th American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exposition being held December 9-12, 2023 in San Diego, CA. Lead investigator Dr. Naval Daver, Professor, Director Leukemia Research Alliance Program, Department of Leukemia, The University of Texas MD Anderson Cancer Center, will present data from Aptose’s ongoing APTIVATE trial of tuspetinib (TUS) single agent and the TUS/VEN doublet in relapsed/refractory patients with acute AML.

Multiple Planned Value-creating Milestones Ahead

APTIVATE oral presentation at ASH (Free ASH Whitepaper) 2023 by Dr. Naval Daver
TUS/VEN incremental data readout in R/R AML planned: ASH (Free ASH Whitepaper) 2023
TUS/VEN further data on duration of response in R/R AML planned: 1Q & 2Q2024
TUS/VEN/HMA planned initiation of pilot triplet study in 1L AML: 1H2024
Extension into HR-MDS and CMML planned: 4Q2023

FINANCIAL RESULTS OF OPERATIONS
Aptose Biosciences, Inc.
Statements of Operations Data
(unaudited)
($ in thousands, except per share data)

Three months ended Nine months ended
September 30, September 30,
2023 2022 2023 2022
Expenses:
Research and development $ 8,256 $ 6,578 $ 27,649 $ 21,312
General and administrative 3,425 3,448 12,580 10,887
Operating expenses 11,681 10,026 40,229 32,199
Other income, net 234 249 977 376
Net loss $ (11,447 ) $ (9,777 ) $ (39,252 ) $ (31,823 )
Net Loss per share, Basic and diluted $ (1.76 ) $ (1.59 ) $ (6.14 ) $ (5.17 )

Weighted average number of common shares outstanding used in computing net loss per share, basic and diluted (in thousands)

6,495 6,153 6,391 6,150
Net loss for the three-month period ended September 30, 2023 increased by $1.7 million to $11.4 million, as compared to $9.8 million for the comparable period in 2022. Net loss for the nine-month period ended September 30, 2023 increased by $7.4 million to $39.3 million, as compared to $31.8 million for the comparable period in 2022.

Aptose Biosciences, Inc.
Balance Sheet Data
(unaudited)
($ in thousands)

September 30, December 31,
2023 2022
Cash, cash equivalents and short-term investments $ 17,717 $ 46,959
Working capital 7,291 37,235
Total assets 20,876 51,027
Long-term liabilities 720 1,002
Accumulated deficit (503,582 ) (464,330 )
Stockholders’ equity 7,776 37,741

Total cash and cash equivalents and investments as of September 30, 2023, were $17.7 million, a decrease of $5.6 million as compared to $23.3 million at June 30, 2023, and a decrease of $29.2 million as compared to $46.9 million at December 31, 2022. Based on current operations, the Company expects that cash on hand and available capital provide the Company with sufficient resources to fund planned Company operations including research and development through March of 2024.

Common shares outstanding on November 9, 2023, were 7,816,923.

RESEARCH AND DEVELOPMENT EXPENSES

The research and development expenses for the three-month and nine-month periods ended September 30, 2023, and 2022 were as follows:

Three months ended Nine months ended
September 30, September 30,
(in thousands) 2023 2022 2023 2022

Program costs – Tuspetinib $ 5,814 $ 3,049 $ 18,659 $ 6,570
Program costs – Luxeptinib 648 1,390 2,643 6,624
Program costs – APTO-253 2 66 28 345
Personnel related expenses 1,523 1,627 5,107 5,821
Stock-based compensation 259 440 1,183 1,923
Depreciation of equipment 10 6 29 29
Total $ 8,256 $ 6,578 $ 27,649 $ 21,312
Research and development expenses increased by $1.7 million to $8.3 million for the three-month period ended September 30, 2023, as compared to $6.6 million for the comparative period in 2022. Changes to the components of our research and development expenses presented in the table above are primarily as a result of the following events:

Program costs for tuspetinib were $5.8 million for the three-month period ended September 30, 2023. The higher program costs for tuspetinib in the current period represent the enrollment of patients in our APTIVATE clinical trial, our healthy volunteer trial, manufacturing activities to support clinical development, and related expenses.
Program costs for luxeptinib decreased by approximately $742 thousand, primarily due to lower clinical trial costs and lower manufacturing costs as a result of the current formulation requiring less API than the prior formulation.
Program costs for APTO-253 decreased by approximately $64 thousand, due to the Company’s decision on December 20, 2021 to discontinue further clinical development of APTO-253.
Personnel-related expenses decreased by $104 thousand, related to fewer employees in the current three-month period, partially offset by salary increases.
Stock-based compensation decreased by approximately $181 thousand in the three months ended September 30, 2023, compared to the three months ended September 30, 2022, primarily due to stock options granted with lower grant date fair values, in the current period.
Research and development expenses increased by $6.3 million to $27.6 million for the nine-month period ended September 30, 2023, as compared to $21.3 million for the comparative period in 2022. Changes to the components of our research and development expenses presented in the table above are primarily as a result of the following events:

Program costs for tuspetinib were $18.7 million for the nine-month period ended September 30, 2023, an increase of $12.1 million compared with $6.6 million in the corresponding period in 2022. The higher program costs for tuspetinib in the current period represent the enrollment of patients in our APTIVATE clinical trial, our healthy volunteer trial, manufacturing activities to support clinical development, and related expenses.
Program costs for luxeptinib decreased by approximately $4 million from $6.6 million in the nine months ended September 30, 2022 to $2.6 million in the current period, primarily due to lower clinical trial costs and lower manufacturing costs as a result of the current formulation requiring less API than the prior formulation.
Program costs for APTO-253 decreased by approximately $317 thousand, due to the Company’s decision on December 20, 2021 to discontinue further clinical development of APTO-253.
Personnel-related expenses decreased by $714 thousand, related to fewer employees in the current nine-month period and partially offset by salary increases.
Stock-based compensation decreased by approximately $740 thousand in the nine months ended September 30, 2023, compared to the three months ended September 30, 2022, primarily due to stock options granted with lower grant date fair values, in the current period.
Conference Call & Webcast:

Date: Thursday, November 9, 2023
Time: 5:00 PM ET
Audio Webcast Only: link
Q&A Participant Registration Link*: link
(https://register.vevent.com/register/BIb770b610b0744016870ec2150989ea78)
*Analysts interested in participating in the question-and-answer session will pre-register for the event from the participant registration link above to receive the dial-in numbers and a unique PIN, which are required to access the conference call. They also will have the option to take advantage of a Call Me button and the system will automatically dial out to connect to the Q&A session.

The audio webcast also can be accessed through a link on the Investor Relations section of Aptose’s website here. A replay of the webcast will be available on the Company’s website for 30 days.

The press release, the financial statements and the management’s discussion and analysis for the quarter ended September 30, 2023 will be available on SEDAR+ at www.sedarplus.ca and EDGAR at www.sec.gov/edgar.shtml.

On November 9, 2023 Aprea Therapeutics, Inc. (Nasdaq: APRE) ("Aprea", or the "Company"), a clinical-stage biopharmaceutical company focused on precision oncology through synthetic lethality, reported financial results for the three and nine months ended September 30, 2023, and provided a business update (Press release, Aprea, NOV 9, 2023, View Source [SID1234637351]).

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"We are very pleased by the progress of our diversified programs this past quarter. Importantly, we presented initial clinical data from our Phase 1/2a study of our ATR inhibitor, ATRN-119, in solid tumors in a poster at the recent AACR (Free AACR Whitepaper)-NCI-EORTC International Conference. To date, ATRN-119 has demonstrated an ability to be a very compelling molecule, appearing to be well tolerated with no reports of dose-limiting toxicities and ongoing daily dosing may result in persistent tumor-reducing effect," said Oren Gilad, Ph.D., President and Chief Executive Officer of Aprea. "We are continuing with patients in the dose escalation portion of the study, and the dose expansion cohort is on track to be initiated in 2Q 2024. In our WEE1 inhibitor, ATRN-1051, program we are on track to file an IND with the FDA by the end of 2023, and plan to begin clinical testing in the first half of 2024. Our strong balance sheet continues to support our strategy and plans through our near-term milestones in both our ATR and WEE1 programs, with a cash runway through the end of the fourth quarter of 2024. We look forward to providing more updates as we make progress and reach important milestones in the coming weeks and months."

Key Business and Financial Updates

Hosted a Key Opinion Leader (KOL) event on October 31, 2023, highlighting the Company’s portfolio of small molecules focused on Synthetic Lethality (SL) by targeting the DNA Damage Response (DDR) Pathways. The event featured Key Opinion Leaders Dr. Fiona Simpkins, Professor in the Division of Gynecology Oncology and Department of OB-GYN at the University of Pennsylvania, Dr. Timothy Yap, medical oncology physician-scientist and Professor at the University of Texas MD Anderson Cancer Center, Dr. Eric Brown, a consultant to Aprea and a Professor at the University of Pennsylvania and a member of the Abramson Family Cancer Research Institute, and Aprea’s Dr. Nadeem Mirza, Senior Medical Advisor. The speakers, along with the management team, provided an overview of the Company’s lead ATR inhibitor candidate, ATRN-119, and its WEE1 inhibitor candidate, ATRN-1051, and highlighted the addressable unmet clinical need and potential combination therapies using these programs.
Presented initial clinical data on the Company’s ATR inhibitor, ATRN-119, and preclinical data on its WEE1 inhibitor, ATRN-1051, at the AACR (Free AACR Whitepaper)-NCI-EORTC AACR-NCI-EORTC (Free AACR-NCI-EORTC Whitepaper) International Conference on Molecular Targets and Cancer Therapeutics (EORTC-NCI-AACR) (Free ASGCT Whitepaper) (Free EORTC-NCI-AACR Whitepaper) on October 14, 2023. The first poster included initial data from the Company’s first-in-human Phase 1/2a dose escalation trial of ATRN-119 in solid tumors. The trial is being conducted to determine the recommended Phase 2 dose, with a daily dosing administration over a 56-day cycle. The Company is actively enrolling cohort 4 at 350mg, with subsequent 550mg cohort 5 and 800mg cohort 6 planned. The Company anticipates enrolling the first patient in the dose expansion portion of the study in Q2 2024.
The second poster presented preclinical data from the Company’s WEE1 inhibitor program that demonstrated the potential safety and efficacy of its highly differentiated WEE1 inhibitor, ATRN-1051, in the treatment of ovarian cancer. The data showed ATRN-1051 to be a highly potent and selective inhibitor of WEE1 that does not significantly affect the off-target PLK1, PLK2, and PLK3 family of kinases. ATRN-1051 shows potentially favorable PK properties and appears to cause lower inhibition of hERG, a potential indication of low cardiotoxicity. Importantly, at doses and scheduling that suppress tumor growth, ATRN-1051 causes little anemia. These findings have justified IND-enabling studies for clinical development of ATRN-1051. Evidence generated by Aprea suggests such off-targeting of the PLK family, which has been a challenge for other WEE1 inhibitors in the class, substantially limits the ability of WEE1 inhibitors to cause cell death.
Appointed Dr. Jean-Pierre Bizzari to its Board of Directors. Dr. Bizzari has been responsible for numerous global approvals of several billion-dollar therapies, has been involved in acquisition and licensing agreements with several major pharmaceutical companies, and is a member and leader on many scientific committees. The Company also named Dr. Richard Peters as Chairman of the Board; Dr. Peters has served as a member of the Board since June 2020 bringing over 2 decades of experience in developing new therapies for difficult-to-treat diseases.
Potential Upcoming Key Milestones

ATR Inhibitor Clinical Program (ATRN-119)

Phase 1/2a Monotherapy Dose Escalation study
1Q 2024 Complete dose escalation
Phase 1/2a Monotherapy Dose Expansion study
2Q 2024 First patient enrolled
WEE1 Inhibitor Program (ATRN-1051)

IND
4Q 2023 IND Submission
1Q 2024 IND Clearance

Phase 1/2a Monotherapy Dose Escalation Study

1H 2024 First patient enrolled
Select Financial Results for the Third Quarter ended September 30, 2023

As of September 30, 2023, the Company reported cash and cash equivalents of $25.4 million.
For the quarter ended September 30, 2023, the Company reported an operating loss of $3.5 million, compared to an operating loss of $4.2 million for the same period in 2022.
Research and Development (R&D) expenses were $2.1 million for the quarter ended September 30, 2023, compared to $1.1 million for the same period in 2022. The increase in R&D expense was related to IND enabling studies for ATRN-1051, the Company’s small molecule WEE1 inhibitor, offset in part by a decrease in personnel costs related to the former facility in Sweden.
General and Administrative (G&A) expenses were $1.7 million for the quarter ended September 30, 2023, compared to $3.1 million for the same period in 2022. The decrease in G&A expenses was due to a decrease in professional fees primarily associated with post-acquisition activities during 2022, a decrease in insurance premiums, and a decrease in personnel costs related to the former facility in Sweden.
The Company reported a net loss of $3.2 million ($0.86 per basic share) on approximately 3.7 million weighted-average common shares outstanding for the quarter ended September 30, 2023, compared to a net loss of $4.0 million ($2.32 per basic share) on approximately 1.7 million weighted average common shares outstanding for the same period in 2022.

On November 9, 2023 Applied DNA Sciences, Inc. (NASDAQ: APDN) ("Applied DNA" or the "Company"), a leader in PCR-based DNA technologies, reported that it has successfully manufactured and shipped its first research use only quantity of self-amplifying mRNA (saRNA) template generated by its Linea DNA platform (the "Platform") to an unidentified preclinical therapeutic mRNA developer (Press release, Applied DNA Sciences, NOV 9, 2023, View Source [SID1234637350]).

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saRNA is a promising new form of mRNA therapy engineered to possess a self-replicating capability. Unlike conventional non-amplifying mRNA, saRNA carries the machinery necessary for its replication, resulting in a higher therapeutic index at a lower dose. Due to these advantages, interest in saRNA is rapidly growing, as evidenced by 10 active saRNA vaccine clinical trials as of Jan. 20231 and numerous companies engaged in preclinical studies to use saRNA to treat indications ranging from cancer to protein replacement therapies. Like mRNA, saRNA is also produced from a DNA template.

The manufacturing of saRNA, however, has proven to be challenging due to the large size and complexity of saRNA and its associated DNA IVT templates. The DNA templates for saRNA are often 3x-5x larger than the DNA templates for conventional non-amplifying mRNA. saRNA can also be challenging to produce efficiently in DNA plasmids, often leading to heterogeneous DNA sequences, low yields, and long manufacturing timelines.

In contrast, the Company’s Platform can rapidly and efficiently enzymatically produce the challenging DNA sequences necessary to produce saRNA with high levels of homogeneity, particularly in challenging sequences such as the poly(T) homopolymers required to produce saRNA. Due to these Platform advantages, the Company is working with additional customers to produce preclinical saRNA IVT templates.

"RNA technology is today central to the development of biologics for human health, and DNA is its manufacturing starting point," stated Dr. James A. Hayward, president and CEO of Applied DNA. "Development pipelines are beginning to see an uptake of saRNA for next-generation mRNA therapies. We believe our Platform’s ability to enzymatically produce the challenging and large DNA sequences needed to manufacture saRNA at scale puts us at the forefront of template manufacturing for this promising and growing mRNA modality."

On November 9, 2023 Aeglea BioTherapeutics, Inc. ("Aeglea" or the "Company") (NASDAQ:AGLE), a biotechnology company advancing a pipeline of antibody therapeutics with the potential to transform the treatment of inflammatory bowel disease ("IBD"), reported its third quarter 2023 financial results and provided program and corporate updates (Press release, Aeglea BioTherapeutics, NOV 9, 2023, View Source [SID1234637349]).

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"We have made significant progress in our first quarter following the Spyre acquisition towards our goal of creating new, best-in-class medicines for patients with IBD. We believe that our combination strategy and pipeline, including SPY001, an extended half-life anti-α4β7 antibody, and SPY002 a dual monomer / trimer anti-TL1A antibody with picomolar affinity and extended half-life, offer the potential to meaningfully improve both efficacy and convenience relative to today’s standard of care," said Cameron Turtle, D.Phil., Chief Operating Officer of Aeglea. "In addition to progressing our portfolio towards first-in-human studies next year, we have built out our team with passionate and experienced biotechnology leaders."

Development Pipeline Overview and Update

With its acquisition of Spyre Therapeutics, Inc. ("Spyre") in June 2023, Aeglea shifted its disease focus to IBD. The Company’s approach combines best-in-class antibody engineering, rational therapeutic combinations, and precision immunology with the goal of maximizing efficacy, safety, and convenience of its IBD treatments under development. IBD is a chronic condition characterized by inflammation within the gastrointestinal tract,

including two main disorders: ulcerative colitis ("UC") and Crohn’s disease ("CD"). In the United States, it is estimated that approximately 2.4 million individuals are diagnosed with IBD.

The Company has four product candidates in preclinical development, three of which are validated targets in IBD. The fourth product candidate is a novel, undisclosed target.

SPY001 – a highly potent and selective anti-α4β7 monoclonal antibody engineered with half-life extension technology and formulated for high concentration, convenient dosing.

•SPY001 is currently progressing through IND-enabling studies and is expected to enter first-in-human ("FIH") studies in the first half of 2024.
•Interim data from a healthy volunteer study are expected by the end of 2024. The Company expects pharmacokinetic data to demonstrate proof of concept for its ability to potentially reach an every-eight-week or every-twelve-week dosing interval.

SPY002 – a highly potent and selective anti-TL1A monoclonal antibody engineered with half-life extension technology. The Company believes TL1A has emerged as one of the most promising targets in IBD and broader immunology indications.

•The Company’s extensive discovery campaign has identified lead clones which bind both TL1A monomers and trimers with picomolar affinity and have in vitro potency and pharmacokinetic half-lives that exceed all clinical-stage TL1A antibodies.
•The Company expects to begin FIH studies of the SPY002 program in the second half of 2024 with healthy volunteer interim data expected in the first half of 2025.

SPY003 – a highly potent and selective monoclonal antibody targeting the p19 subunit of IL-23 engineered with half-life extension technology.

•The Company continues preclinical development efforts on a potential best-in-class IL-23 monoclonal antibody. Recent data from the Phase 3 SEQUENCE study of risankizumab versus ustekinumab in Crohn’s disease validates the Company’s targeting of the p19 subunit as it demonstrated superiority to targeting the p40 subunit of IL-23.
•An IND/CTN is expected in 2025.
Corporate Updates

•In October 2023, the Company filed a definitive proxy statement regarding the Special Meeting of Stockholders to be held on November 21, 2023 (the "Special Meeting"). At the Special Meeting, stockholders are expected to vote on four proposals, including the conversion of the Company’s Series A Preferred Stock to common stock and an increase to the Company’s authorized shares.
•In September 2023, the Company strengthened its leadership team with the appointments of industry veterans Scott Burrows, as Chief Financial Officer, and Heidy Abreu King-Jones, as Chief Legal Officer and Corporate Secretary.
•In September 2023, the Company completed a reverse stock split of all outstanding shares of common stock at a ratio of 1-for-25, with trading on a split-adjusted basis on the Nasdaq Capital Market beginning on September 8, 2023.
•In July 2023, the Company sold the global rights to pegzilarginase to Immedica Pharma AB ("Immedica") for $15 million in upfront cash proceeds and up to $100 million in contingent milestone payments. In November 2023, holders of the Company’s contingent value rights (CVRs) are expected to receive a payment representing the Immedica sale proceeds net of expenses and adjustments pursuant to the CVR agreement entered into in connection with Aeglea’s acquisition of Spyre.

Third Quarter 2023 Financial Results
Cash Position: As of September 30, 2023, Aeglea had available cash and cash equivalents, marketable securities, and restricted cash of $204.9 million.
Research and Development (R&D) expenses: R&D expenses totaled $24.7 million for the third quarter of 2023 and $12.0 million for the third quarter of 2022. This increase was primarily related to increases in preclinical development and manufacturing expenses for the Company’s IBD pipeline, partially offset by a decrease in expenses associated with the legacy Aeglea rare disease pipeline.
General and Administrative (G&A) expenses: G&A expenses totaled $8.6 million for the third quarter of 2023 and $7.0 million for the third quarter of 2022. This increase was primarily due to an increase in legal and employee separation costs.
Gain on Sale of In-Process Research & Development Asset: During the third quarter of 2023, the Company recognized a $14.6 million gain on the sale of the global rights of pegzilarginase to Immedica.
Other Income and Expenses: Other Income and Expenses were a net $21.8 million expense in the third quarter of 2023, primarily driven by a $25.4 million non-cash forward contract liability expense related to an increase in fair value of the underlying Series A Preferred Stock between June 30, 2023 and the forward contract’s settlement on July 7, 2023.
Net Loss: Net loss totaled $40.1 million and $18.2 million for the third quarter of 2023 and 2022, respectively, which includes non-cash stock compensation expense of $4.8 million and $1.6 million for the third quarter of 2023 and 2022, respectively.

On November 9, 2023 Adaptive Biotechnologies Corporation ("Adaptive Biotechnologies") (Nasdaq: ADPT), a commercial stage biotechnology company that aims to translate the genetics of the adaptive immune system into clinical products to diagnose and treat disease, reported financial results for the quarter ended September 30, 2023 (Press release, Adaptive Biotechnologies, NOV 9, 2023, View Source [SID1234637348]).

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"We have two compelling businesses in MRD and Immune Medicine, which continue to make significant progress in divergent ways," said Chad Robins, chief executive officer and co-founder of Adaptive Biotechnologies. "Given the advancements achieved to date by each business and their respective investment needs, we are conducting a review of strategic alternatives to maximize value for our patients and shareholders."

Recent Highlights

•
Strategic review underway with Goldman Sachs to maximize the value of the MRD and Immune Medicine businesses.
•
Revenue for the third quarter 2023 was $37.9 million, representing a 21% decrease from the third quarter 2022 driven primarily by a 61% reduction in GNE amortization and a 14% decrease in MRD pharma services and IM pharma services largely due to biopharmaceutical industry headwinds.
•
clonoSEQ test volume in the third quarter 2023 grew 56% to 15,072 tests delivered versus the third quarter of prior year.
•
Immune Medicine achieved a key milestone with the discovery of a novel target in multiple sclerosis, which validates our target discovery approach in autoimmune disorders.
•
Operating expenses, excluding cost of revenue, for the third quarter 2023 decreased 11% versus the same period last year as a result of continued operating efficiencies efforts.
Third Quarter 2023 Financial Results

Revenue was $37.9 million for the quarter ended September 30, 2023, representing a 21% decrease from the third quarter in the prior year. Immune Medicine revenue was $13.3 million for the quarter, representing a 52% decrease from the third quarter in the prior year. MRD revenue was $24.7 million for the quarter, representing a 24% increase from the third quarter in the prior year.

Operating expenses were $88.9 million for the third quarter of 2023, compared to $93.3 million in the third quarter of the prior year, representing a decrease of 5%. Interest expense from our revenue interest purchase agreement was $3.7 million for the third quarter of 2023, compared to $0.7 million in the third quarter of the prior year.

Net loss was $50.3 million for the third quarter of 2023, compared to $45.3 million for the same period in 2022.

Adjusted EBITDA (non-GAAP) was a loss of $29.8 million for the third quarter of 2023, compared to a loss of $25.9 million for the third quarter of the prior year.

Cash, cash equivalents and marketable securities was $371.1 million as of September 30, 2023.

2023 Financial Guidance Update

In light of the strategic review and evolving focus of Immune Medicine as a drug discovery business, Adaptive Biotechnologies is updating full year 2023 revenue guidance to exclude revenue from the Immune Medicine business.

MRD business full year 2023 revenue to be in the range of $100 million to $105 million.

Total company operating expenses, including cost of revenue, for full year 2023 to be around $375 million.

Webcast and Conference Call Information

Adaptive Biotechnologies will host a conference call to discuss its third quarter 2023 financial results after market close on Thursday, November 9, 2023 at 4:30 PM Eastern Time. The conference call can be accessed at View Source The webcast will be archived and available for replay at least 90 days after the event.