On November 13, 2023 Sutro Biopharma, Inc. (Sutro or the Company) (NASDAQ: STRO), a clinical-stage oncology company pioneering site-specific and novel-format antibody drug conjugates (ADCs), reported its financial results for the third quarter of 2023, its recent business highlights, and a preview of select anticipated milestones (Press release, Sutro Biopharma, NOV 13, 2023, View Source [SID1234637564]).

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"The last few months have been productive for Sutro, with the recent presentation of encouraging early data for luvelta in endometrial cancer, as well as the appointment of Dr. Hans-Peter Gerber as our CSO. Dr. Gerber’s extensive experience in discovering and developing novel ADCs further strengthens our position as a scientific leader in this important therapeutic modality," said Bill Newell, Sutro’s Chief Executive Officer. "The recent encouraging update with luvelta in endometrial cancer gave us further confidence in the potential for luvelta to be a targeted treatment for a range of indications with significant unmet need. Additionally, we are pleased with the pace of enrollment of our Phase 2/3 trial for luvelta in patients with platinum resistant ovarian cancer, REFRaME-O1."

"Sutro’s remarkable platform has the potential to yield best in class product candidates from all of our ADC design concepts – including ADCs, iADCs, and ADC2. The diversity of product candidate attributes enabled by Sutro technology is what originally attracted me to the company," said Hans-Peter Gerber, Sutro’s CSO. "After an in-depth review of the platform and programs developed at Sutro, I am excited to combine our industry leading technology with our established development capabilities to deliver fit-for-purpose molecules that could transform the lives of cancer patients with limited options."

Recent Business Highlights and Select Anticipated Milestones

STRO-002, International Nonproprietary Name, "luveltamab tazevibulin," abbreviated as "luvelta," FolRα-Targeting ADC: Luvelta is being studied in the clinic globally for patients with ovarian and endometrial cancers.

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Initial results from the Phase 1 dose-expansion study for luvelta in patients with endometrial cancer were presented in a mini oral presentation at the 2023 European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) Congress held in Madrid, Spain in October 2023. Luvelta demonstrated encouraging preliminary anti-tumor activity in FolRα-selected patients, defined by a Tumor Proportion Score (TPS) of >25% FolRα expression, and the safety profile was consistent with prior data in patients with platinum-resistant ovarian cancer.

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Previous data from the Phase 1 dose-expansion study for luvelta in ovarian cancer demonstrated meaningful clinical benefit in FolRα-selected patients, defined by a TPS of >25%, irrespective of staining intensity, in which the data collected has shown to represent approximately 80% of the advanced ovarian cancer patient population.
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In June 2023, Sutro announced the initiation of Part I of REFRaME-O1, a Phase 2/3 registration-directed study for patients with platinum-resistant ovarian cancer. The trial is well underway, and sites have been activated globally. Sutro is also in discussions with both the FDA and EMA to refine the trial design for REFRaME-O1 to potentially support global registration of luvelta.
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Patients with CBFA2T3::GLIS2 (CBF/GLIS; RAM phenotype) AML, a highly refractory and uniformly fatal subtype of acute myeloid leukemia found exclusively in infants and young children, were treated with luvelta under compassionate use. Preliminary results from compassionate use of luvelta in this ultra rare indication suggested that luvelta was well tolerated as a monotherapy agent and in combination with standard cancer therapies. Soheil Meshinchi, M.D., Ph.D., expects to present updated data from this program in a poster at the 65th American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exposition (ASH 2023) to be held December 9-12, 2023 in San Diego, CA.
Title: Anti-Leukemic Activity of Luveltamab Tazevibulin (LT, STRO-002), a Novel Folate Receptor-α (FR-α)-Targeting Antibody Drug Conjugate (ADC) in Relapsed/Refractory CBFA2T3::GLIS2 AML

Session: 616. Acute Myeloid Leukemias: Investigational Therapies, Excluding Transplantation and Cellular Immunotherapies: Poster III

Date & Time: Monday, December 11, 2023, 6:00 PM – 8:00 PM PT

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Luvelta is also being studied in combination with bevacizumab for patients with advanced ovarian cancer.
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Translational work is ongoing to support an Investigational New Drug (IND) application for the initiation of a study of luvelta for patients with non-small cell lung cancer (NSCLC), for which the protocol is under development.
Additional Pipeline Development: STRO-003, a ROR1-targeting ADC, and STRO-004, a tissue factor-targeting ADC, have INDs planned for 2024 and 2025, respectively.

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STRO-003, a novel, next-generation ADC that has been designed to target ROR1, features eight precisely placed β-Glucuronidase-cleavable linkers attached to next-generation exatecan warheads, which, when released, inhibit topoisomerase-1 (TOPO-1) and cause DNA disruption.
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STRO-003 has demonstrated, in NSCLC and breast cancer patient-derived xenograft models, strong cell-killing activity in low and heterogeneous ROR1-expressing tumors. STRO-003 has also exhibited promising tolerability in preclinical studies involving rodents and non-human primates, with potentially reduced lung toxicity relative to other TOPO-1 inhibiting ADCs.
Collaboration Updates: Sutro continues to seek to maximize the value of its proprietary cell-free platform by working with partners on programs in multiple disease spaces and geographies and has generated from collaborators an aggregate of approximately $785 million in payments through September 30, 2023, including equity investments.

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In June 2023, Sutro announced a royalty monetization agreement with Blackstone Life Sciences, an affiliate of Blackstone, under which Sutro received $140 million upfront and is eligible to receive up to an additional $250 million in future milestone payments in exchange for the 4% royalty, or revenue interest, in potential future sales of Vaxcyte’s products. This transaction with Blackstone provides non-dilutive capital to Sutro for continued pipeline advancement. Sutro retains the right to discover and develop vaccines for the treatment or prophylaxis of any disease that is not caused by an infectious pathogen, including cancer.
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In December 2022, Sutro and Vaxcyte expanded upon a nearly decade-long relationship through a new agreement, under which Vaxcyte acquired an option to access expanded rights to develop and manufacture cell-free extract, among other rights, and includes a $22.5 million upfront payment and, upon exercise of the option, up to an additional $135 million in option exercise and contingent payments.
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Sutro’s collaboration with Astellas on the discovery of immunostimulatory antibody-drug conjugates (iADCs) for three targets is ongoing, for which Sutro receives financial support for its research efforts, potential milestone payments and royalties, and has an option to co-develop and co-commercialize product candidates in the U.S.
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Sutro is manufacturing initial drug supply for its partners including for Merck’s MK-1484, currently in Phase 1 as monotherapy and in combination with pembrolizumab in advanced or metastatic solid tumors. Sutro is providing clinical drug supply to BioNova for clinical studies for BN301 (STRO-001) in Greater China. Sutro is currently supporting Tasly Biopharmaceuticals (Tasly), which recently received its first IND clearance by the National Medical Products Administration, or NMPA, for their initiation of clinical development activities in Greater China for STRO-002 and will provide initial drug supply for their Phase 1 study.
Corporate Updates: Sutro strengthened and continues to build a world-class leadership team through the appointment of a new Chief Scientific Officer.

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Hans-Peter Gerber, Ph.D., joined Sutro as Chief Scientific Officer in September 2023, overseeing the research and early discovery functions, with a focus on the design and discovery of new molecules to rapidly progress into the clinic, in addition to being a member of Sutro’s Senior Management Team.
Upcoming Events: Sutro plans to participate in two upcoming investor conferences. Webcasts of the presentations will be accessible through the News & Events page of the Investor Relations section of the company’s website at www.sutrobio.com. Archived replays will be available for at least 30 days after the events.

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Jefferies London Healthcare Conference in London, Wednesday, November 14-16, 2023
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Piper Sandler 35th Annual Healthcare Conference in New York, November 28-30, 2023
Third Quarter 2023 Financial Highlights

Cash, Cash Equivalents and Marketable Securities

As of September 30, 2023, Sutro had cash, cash equivalents and marketable securities of $321.1 million, as compared to $358.3 million as of June 30, 2023, and approximately 0.7 million shares of Vaxcyte common stock with a fair value of $34.0 million, which together provide a projected cash runway into the first half of 2025, based on current business plans and assumptions. Current market conditions provide a challenging financing environment. In this context, Sutro is evaluating its programs and spending as it fully develops its 2024 goals and financial plan.

Unrealized Gain from Increase in Value of Vaxcyte Common Stock

The non-operating, unrealized gain of $0.7 million in the quarter ended September 30, 2023 was due to the increase since June 30, 2023 in the estimated fair value of Sutro’s holdings of Vaxcyte common stock. Vaxcyte common stock held by Sutro will be remeasured at fair value based on the closing price of Vaxcyte’s common stock on the last trading day of each reporting period, with any non-operating, unrealized gains and losses recorded in Sutro’s statements of operations.

Revenue

Revenue was $16.9 million for the quarter ended September 30, 2023, as compared to $25.1 million for the same period in 2022, with the 2023 amount related principally to the Astellas collaboration and the recognition of a contingent payment from Tasly. Future collaboration and license revenue under existing agreements, and from any additional collaboration and license partners, will fluctuate as a result of the amount and timing of revenue recognition of upfront, milestones, and other agreement payments.

Operating Expenses

Total operating expenses for the quarter ended September 30, 2023 were $60.9 million, as compared to $46.4 million for the same period in 2022. The third quarter of 2023 includes non-cash expenses for stock-based compensation of $6.0 million and depreciation and amortization of $1.7 million, as compared to $6.8 million and $1.4 million, respectively, in the comparable 2022 period. Total operating expenses for the quarter ended September 30, 2023 were comprised of research and development expenses of $45.7 million and general and administrative expenses of $15.3 million.

Royalty Monetization Agreement

As related to the royalty monetization agreement between Sutro and an affiliate of Blackstone Life Sciences, Sutro received in June 2023 a $140.0 million upfront payment and is eligible to receive up to an additional $250.0 million in future milestone payments. Sutro recorded the $140.0 million upfront payment from Blackstone as a deferred royalty obligation related to the sale of future royalties on the Company’s condensed Balance Sheets as of June 30, 2023. Due to the Company’s ongoing manufacturing obligations, the Company accounted for the proceeds as imputed debt and will recognize future non-cash royalty revenues. Non-cash interest expense will be recognized over the estimated life of the royalty term arrangement using the effective interest method based on the imputed interest rate derived from estimated amounts and timing of future royalty payments to be received from Vaxcyte. As part of the sale, Sutro incurred approximately $3.8 million in transaction costs, which are being amortized over the estimated life of the royalty term arrangement using the effective interest method. As future royalties are earned from Vaxcyte by Blackstone, the balance of the deferred royalty obligation will be amortized over the estimated life of the royalty term arrangement.

On November 13, 2023 Soligenix, Inc. (Nasdaq: SNGX) (Soligenix or the Company), a late-stage biopharmaceutical company focused on developing and commercializing products to treat rare diseases where there is an unmet medical need, reported its recent accomplishments and financial results for the quarter ended September 30, 2023 (Press release, Soligenix, NOV 13, 2023, View Source [SID1234637563]).

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"We continue our collaborative discussions with the U.S. Food and Drug Administration (FDA) regarding the design of a second, confirmatory Phase 3 pivotal study evaluating HyBryte (synthetic hypericin sodium) in the treatment of cutaneous T-cell lymphoma (CTCL), where we successfully demonstrated statistically significant results in the first Phase 3 clinical trial," stated Christopher J. Schaber, PhD, President and Chief Executive Officer of Soligenix. "We continue to actively enroll patients in the Phase 2a trial of SGX302 (synthetic hypericin sodium) for the treatment of mild-to-moderate psoriasis after demonstration of a clear biological signal in all five of the initial patients, with the majority recording an improvement in their PASI (psoriasis area and severity index) score. Under our Public Health Solutions business segment, we continue to advance our heat stable vaccine platform technology, ThermoVax. Most recently, we successfully demonstrated two year stability of thermostabilized bivalent and trivalent filovirus vaccine candidates at temperatures of 40 degrees Celsius (104 degrees Fahrenheit) when formulated in a single vial, needing reconstitution only with sterile water immediately prior to use. This follows the previous successful demonstration of 100% protection of non-human primates against lethal Sudan ebolavirus and Marburg marburgvirus challenge with the bivalent vaccine."

Dr. Schaber continued, "With approximately $10.3 million in cash at September 30, 2023, not including our non-dilutive government funding, we are managing cash burn very carefully in order to achieve our near-term milestones. We continue to evaluate a number of strategic options, including but not limited to, partnership and merger and acquisition opportunities."

Financial Results – Quarter Ended September 30, 2023

Soligenix’s revenues for the quarters ended September 30, 2023 were $0.1 million as compared to $0.2 million for the quarter ended September 30, 2022. Revenues primarily relate to government contracts and grants awarded in support of SGX943, our therapeutic candidate for treatment of emerging and/or antibiotic-resistant infectious diseases; and CiVax, our vaccine candidate for the prevention of COVID-19.

Soligenix’s net loss was $1.7 million, or ($0.16) per share, for the quarter ended September 30, 2023, as compared to $3.3 million, or ($1.15) per share, for the quarter ended September 30, 2022. The decrease in net loss was primarily due to decreases in operating expenses and interest expense and an increase in other income.

Research and development expenses were $0.8 million as compared to $1.8 million for the quarters ended September 30, 2023 and 2022, respectively. The decrease was primarily due to the decrease in manufacturing and regulatory costs associated with the HyBryte new drug application filing.

General and administrative expenses were $1.0 million and $1.3 million for the quarters ended September 30, 2023 and 2022, respectively. This decrease in general and administrative expenses is primarily attributable to a reduction in legal and consulting expenses associated with the arbitration against Emergent BioSolutions, Inc. and certain of its subsidiaries.

As of September 30, 2023, the Company’s cash position was approximately $10.3 million.

On November 13, 2023 SELLAS Life Sciences Group, Inc. (NASDAQ: SLS) ("SELLAS" or the "Company"), a late-stage clinical biopharmaceutical company focused on the development of novel therapies for a broad range of cancer indications, reported that it recently concluded a Type C meeting with the U.S. Food and Drug Administration (FDA) regarding the Company’s Chemistry, Manufacturing, and Controls (CMC) sections in a potential biologics license application ("BLA") for SELLAS’ lead product candidate, galinpepimut-S (GPS) (Press release, Sellas Life Sciences, NOV 13, 2023, View Source [SID1234637562]). SELLAS submitted a CMC Briefing Package to the FDA which provided an up-to-date overview of the extensive work completed for the GPS CMC program and commercial manufacturing and regulatory plans. The FDA reviewed this package of data and accompanying questions to the agency and responded with favorable guidance.

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To date, the Company has successfully completed numerous clinical development and CMC objectives in advancing GPS monotherapy into its Phase 3 REGAL study in patients with acute myeloid leukemia ("AML") in the maintenance setting after achievement of second complete remission. CMC activities in support of the clinical development leading to this Type C meeting include:

Manufacturing lyophilized clinical GMP batches;
Qualifying processes;
Validating analytical methods; and
Monitoring the stability program.
The FDA also agreed on the Company’s proposed stability data generation plan for the commercial presentation of GPS. GPS is expected to be stored at 2-8 C (36 – 46 F) making it more accessible for end-users.

Andrew Elnatan, Vice President of Regulatory Affairs, CMC & Quality at SELLAS, stated, "We are pleased with the positive outcome of the Type C meeting and FDA’s guidance on the advancement of the CMC plans as part of the GPS program development. The responses to questions regarding our proposed potency assay and manufacturing processes validation are aligned with our expectations and will help guide our plans towards a potential future successful BLA assuming positive data from the REGAL study."

"We look forward to completing our enrollment in the Phase 3 REGAL trial, outside of China, this month and working closely with the FDA as we continue to advance our GPS development program. GPS, through its unique mechanism of action and novel technology, has the potential to become the first immunotherapy, cancer vaccine to reach the market for AML. There are currently no FDA-approved drugs to address the high unmet medical need that exists in treating patients in the maintenance setting in second complete remission," said Angelos Stergiou, MD, ScD hc, President and Chief Executive Officer at SELLAS. "Our off-the-shelf therapy, GPS, was precisely and deliberately designed to target Wilms Tumor 1 and the multivalent approach of GPS targets 25 carefully selected WT1 epitopes, allowing it to be maximally immunogenic by eliciting both CD4 and CD8 immune responses. GPS has the potential to offer clinical benefit to this population of leukemia patients and the positive CMC regulatory feedback is a critical step in its development."

On November 13, 2023 Selecta Biosciences, Inc. (NASDAQ: SELB) (the Company) reported that it has merged with Cartesian Therapeutics, Inc., a clinical-stage biotechnology company pioneering RNA cell therapies for autoimmune diseases (Press release, Selecta Biosciences, NOV 13, 2023, View Source [SID1234637561]). In connection with the merger, Selecta announced a $60.25 million private financing led by Timothy A. Springer, Ph.D., member of the Selecta Board of Directors.

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With the cash from both companies at closing and the proceeds of the concurrent private financing, the combined company is expected to have over $110 million on hand to support the development of the Cartesian pipeline through the Phase 3 study of lead product candidate, Descartes-08, a potential first-in-class RNA-engineered chimeric antigen receptor T-cell therapy (rCAR-T) for the treatment of MG, as well as the advancement of additional RNA cell therapy programs.

Concurrent with the merger, the combined company has been renamed Cartesian Therapeutics, Inc. The Company’s Nasdaq ticker symbol will change to "RNAC" effective prior to the opening of trading tomorrow, November 14, 2023.

"We are thrilled to announce our merger with Cartesian, a true pioneer in the RNA cell therapy space," said Carsten Brunn, Ph.D., who will continue to serve as President and Chief Executive Officer of the combined company. "With several potential value-driving milestones expected in the near-term, including data from the ongoing Phase 2b study of Descartes-08 in MG expected in mid-2024, we are confident that this merger represents a significant opportunity for Selecta stockholders. Cartesian’s mission aligns seamlessly with Selecta’s commitment to advancing innovative therapies for the treatment of autoimmune diseases, and we look forward to working toward maximizing the potential of this robust pipeline and technology."

"RNA cell therapy has the potential to overcome the challenges of using conventional, costly DNA-engineered cell therapies to treat autoimmune diseases, including their toxicity and the need for preconditioning chemotherapy," said Murat Kalayoglu, M.D., Ph.D., Co-Founder and former Chief Executive Officer of Cartesian. "With a shared vision of bringing meaningful therapeutic options to patients with autoimmune diseases, we are confident that our novel approach can thrive under Carsten’s leadership."

Cartesian’s Portfolio and Proprietary RNA Armory Platform

Cartesian’s internally manufactured portfolio includes RNA cell therapies that are purposefully designed to be administered conveniently in an outpatient setting. Cartesian’s RNA-engineering approach has the potential to expand the reach of cell therapy to autoimmunity with potentially safer, potent, and less expensive therapies versus DNA analogs.

Cartesian’s proprietary technology platform, RNA Armory, is designed to enable precision control and optimization of engineered cells for diverse cell therapies leveraging multiple modalities, including autologous, allogeneic, and in vivo transfection. In addition, Cartesian’s wholly owned, state-of-the-art GMP manufacturing and internal research and development capabilities potentiates the optimization of processes in a rapid and iterative manner.

Cartesian’s wholly owned pipeline includes:

Descartes-08 is designed to be an autologous anti-BCMA rCAR-T. Descartes-08 is currently in clinical development for autoimmune diseases, including MG, a chronic autoimmune disorder that causes disabling muscle weakness and fatigue. Compared to conventional DNA-based CAR T-cell therapies, rCAR-T is designed to not require preconditioning chemotherapy, to have predictable and controllable pharmacokinetics, and to avoid the risk of genomic integration. Descartes-08 has been granted Orphan Drug Designation by the U.S. Food and Drug Administration for the treatment of MG.

Cartesian previously reported positive data from its Phase 2a study of 14 patients with MG who received six weekly infusions of Descartes-08 in the outpatient setting without preconditioning chemotherapy. In the study, the results of which were published in The Lancet Neurology, Descartes-08 was observed to be safe and well-tolerated and to induce deep and durable responses. Enrollment is ongoing in a Phase 2b randomized, double-blind, placebo-controlled trial (NCT04146051) in patients with MG, and topline results are expected in mid-2024.

Beyond MG, initiation of a Phase 2 study of Descartes-08 in patients with systemic lupus erythematosus, a chronic autoimmune disease that causes systemic inflammation which affects multiple organ systems, is expected in the first half of 2024. In addition, initiation of a Phase 2 ocular autoimmune basket study and a Phase 2 vasculitic autoimmune basket study is planned for mid-2024 and the second half of 2024, respectively.
Descartes-15 is designed to be a next-generation, autologous anti-BCMA rCAR-T. In preclinical studies, Descartes-15 was observed to be significantly more potent than Descartes-08. Cartesian plans to leverage its clinical observations to date from its Descartes-08 clinical program to inform the clinical strategy for Descartes-15 for the treatment of autoantibody-associated autoimmune diseases (AAAD).

Descartes-33 is designed to be an off-the-shelf (allogeneic) mesenchymal stem cell therapy (rMSC) for the treatment of AAAD. In preclinical studies, Descartes-33 was observed to induce potent degradation of disease-enabling neutrophil extracellular traps.

Management and Organization

The combined company will be led by Selecta’s Chief Executive Officer, Carsten Brunn, Ph.D., and current Chief Financial Officer, Blaine Davis, as well as several members of the legacy Cartesian team, including Metin Kurtoglu, M.D., Ph.D., as Chief Operating Officer, Milos Miljkovic, M.D., as Chief Medical Officer, Chris Jewell, Ph.D., as Chief Scientific Officer, and Emily English, Ph.D., as Vice President of Quality. Matthew Bartholomae, J.D., Selecta’s General Counsel, will continue to serve in this role.

The combined company’s Board of Directors will be led by current Selecta Chairman Carrie S. Cox and will include, among others, current Selecta board member Timothy Springer, Ph.D., as well as Cartesian Co-Founders Murat Kalayoglu, M.D., Ph.D., and Michael Singer, M.D., Ph.D. All members of the Selecta Board of Directors prior to the merger will continue to serve on the Board of Directors following the closing of the transaction.

Merger Terms

The merger was structured as a stock-for-stock transaction pursuant to which all of Cartesian’s outstanding equity interests were exchanged based on a fixed exchange ratio for consideration as a combination of approximately 6.7 million shares of Selecta common stock and approximately 0.38 million shares of Selecta Series A Non-Voting Convertible Preferred Stock ("Series A Preferred Stock") (or approximately 385 million shares on an as-converted-to-common basis). Concurrently with the acquisition of Cartesian, Selecta entered into a definitive agreement for a PIPE investment to raise $60.25 million in which the investors will be issued approximately 0.15 million shares of Series A Preferred Stock (or approximately 149.3 million shares on an as-converted-to-common basis) at a price of $403.46851 per share. Subject to approval of the Company’s stockholders, each share of Series A Preferred Stock will automatically convert into 1,000 shares of common stock, subject to certain beneficial ownership limitations. On a pro forma basis, based upon the number of shares of Selecta common stock and Series A Preferred Stock issued in the acquisition and prior to the private financing, stockholders of Selecta immediately prior to the acquisition will own approximately 26.9% of the Company on an as-converted basis immediately after giving effect to this transaction. The acquisition was approved by the Board of Directors of Selecta and the Board of Directors and stockholders of Cartesian. The closings of the transactions are not subject to the approval of Selecta stockholders. On an as-converted basis, assuming the approval of the Company’s stockholders of the conversion of the Series A Preferred Stock into common stock, and after accounting for these transactions, the total number of shares of Selecta common stock will be approximately 696.2 million.

In connection with the transactions, a transferrable contingent value right (a "CVR") will be distributed to Selecta stockholders and holders of Selecta’s warrants issued in 2022 (the "2022 Warrants") of record as of the close of business on December 4, 2023, but will not be distributed to holders of shares of common stock or Series A Preferred Stock issued to Cartesian or the PIPE investors in the transaction. Additionally, holders of Selecta’s warrants other than the 2022 Warrants will be entitled to receive CVRs when and if such warrants are exercised. Holders of the CVR will be entitled to receive certain cash payments from proceeds received by the Company, if any, from its legacy assets, including SEL-212, following the closing of the transaction.

Leerink Partners is serving as exclusive financial advisor and private placement agent to Selecta. Covington & Burling LLP is serving as legal counsel to Selecta. Foley Hoag LLP is serving as legal counsel to Cartesian.

Conference Call and Webcast

Selecta and Cartesian will host a conference call today, Monday, November 13, 2023, at 9:00 am ET to discuss the merger. To access the conference call, please dial (844) 845-4170 (local) or (412) 717-9621 (international) at least 10 minutes prior to the start time and ask to be joined into the Selecta Biosciences call. The live audio webcast, along with accompanying slides, can be accessed on the Events & Presentations section of Selecta’s website at View Source A replay of the webcast will be available for a limited time following the event on Selecta’s website.

On November 13, 2023 Roivant (Nasdaq: ROIV) reported its financial results for the second quarter ended September 30, 2023, and provided an update on the business (Press release, Roivant Sciences, NOV 13, 2023, View Source [SID1234637560]).

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"In the last few weeks, we announced a historic deal with Roche for the sale of Telavant for $7.25 billion. While we intend to be very thoughtful about capital deployment, we expect that the resulting cash will be sufficient to fund our programs through profitability, in addition to enabling other opportunities and investments," said Matt Gline, CEO of Roivant. "This was also another significant quarter for our clinical programs with a data readout from IMVT-1402’s Phase 1 SAD study and 300 mg MAD cohort. The data represent what we believe is the best-case scenario for our FcRn franchise and truly broadens the horizon for what is possible in the landscape of autoimmune therapies and for patients suffering from autoimmune diseases. We are excited about the recent progress and look forward to announcing additional clinical results for 1402 and brepocitinib in the final quarter of the calendar year. 2023 has continued to deliver on being an incredibly catalyst-rich year, and certainly Roivant’s biggest year yet."

Recent Developments

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Telavant: In October 2023, Roivant entered into a definitive agreement with Roche for the sale of Telavant. Roche will gain the rights to develop, manufacture and commercialize RVT-3101 in the US and Japan for the treatment of inflammatory bowel disease and potentially other diseases. Under the terms of the agreement, Roche will pay a purchase price of $7.1 billion upfront and a milestone payment of $150 million payable upon the initiation of a Phase 3 trial in ulcerative colitis. Roivant owns 75% of the issued and outstanding shares of common stock and preferred stock of Telavant and Pfizer owns the remaining 25%, in each case on an as-converted basis. Roivant’s net proceeds from the transaction are expected to be approximately $5.2 billion plus $110 million from the milestone payment. Regulatory filings in connection with the transaction have been submitted and the closing of the transaction remains on track for the fourth quarter of 2023 or the first quarter of 2024.

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Immunovant: In September 2023, Immunovant announced initial data from the Phase 1 clinical trial evaluating the safety, tolerability, and pharmacodynamic profiles of IMVT-1402 in healthy adults showed that subcutaneously administered doses of IMVT-1402 produced dose-dependent reductions in Immunoglobulin G, with no statistically significant dose-related decrease in serum albumin or increase in LDL cholesterol, strengthening IMVT-1402 as a potential best-in-class neonatal fragment crystallizable receptor (FcRn) inhibitor. In October 2023, Immunovant announced the closing of an underwritten public offering and concurrent private placement offering of common stock yielding approximately $467 million in net proceeds to Immunovant, after deducting underwriting commissions and estimated offering expenses. Roivant owns approximately 55.2% of Immunovant as of November 3, 2023.

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Dermavant: For the second quarter ended September 30, 2023, Roivant reported VTAMA net product revenue of $18.4M, representing a 28% gross-to-net yield for the quarter. As of November 2023, over 250,000 VTAMA prescriptions have been written by approximately 12,800 unique prescribers for psoriasis, based on IQVIA data. Coverage has been expanded to 137 million US commercial lives and includes coverage by all three of the top pharmacy benefit managers.

In October 2023, Dermavant reported that in adult patients, VTAMA showed positive results from a Phase 4 open-label trial for the treatment of intertriginous plaque psoriasis – 82.8% achieved an intertriginous Physician Global Assessment (iPGA) Score of 0 (clear) or 1 (almost clear) and ≥2-grade improvement from baseline at Week 12, demonstrating compelling efficacy. Additionally, Dermavant reported in adults and children down to two years of age with atopic dermatitis, VTAMA showed rapid and significant onset of pruritus (itch) relief as early as 24 hours after initial application.

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Roivant: In September 2023, Roivant raised approximately $200 million in a follow-on offering. Roivant reported cash, cash equivalents and restricted cash of approximately $1.4 billion at September 30, 2023. Giving effect to Immunovant’s October 2023 follow-on offering and expected cash proceeds from the pending sale of Telavant (including one-time milestone), Roivant’s cash, cash equivalents and restricted cash would have been approximately $7.0 billion. The acquisition of Telavant is subject to customary closing conditions and is expected to close in the fourth quarter of 2023 or the first quarter of 2024.

Major Upcoming Milestones

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Immunovant expects additional IMVT-1402 data from the 600 mg multiple-ascending dose cohort in November 2023. Additionally, for batoclimab: Top-line data from the Phase 3 clinical trial in MG are expected in the second half of calendar year 2024. For the Phase 3 program in TED, top-line data are expected in the first half of calendar year 2025. Immunovant also expects to have initial results from period 1 of the Phase 2B clinical trial in CIDP in the first half of calendar year 2024, and initial Phase 2 proof-of-concept data in Graves’ disease by the end of calendar year 2023.

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Priovant plans to announce topline results from the potentially registrational trial evaluating brepocitinib for the treatment of patients with systemic lupus erythematosus (SLE) in the fourth quarter of calendar year 2023. Priovant also expects to announce topline results from the Phase 2 POC study in non-infectious uveitis (NIU) in the first quarter of calendar year 2024 and topline results from the Phase 3 trial in dermatomyositis (DM) in calendar year 2025.

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Dermavant plans to submit its sNDA for VTAMA in atopic dermatitis to the FDA in the first quarter of calendar year 2024.

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Hemavant plans to announce data from the ongoing open-label Phase 1/2 trial evaluating RVT-2001 for the treatment of transfusion-dependent anemia in lower-risk myelodysplastic syndromes (MDS) patients in the first quarter of calendar year 2024.

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Kinevant plans to report topline data from the ongoing Phase 2 trial of namilumab for the treatment of sarcoidosis in the second half of calendar year 2024.

Second Quarter Ended September 30, 2023 Financial Summary

Cash Position

As of September 30, 2023, the Company had consolidated cash, cash equivalents and restricted cash of $1.4 billion.

Research and Development Expenses

Research and development expenses were $132.0 million for each of the three months ended September 30, 2023, and 2022. Changes in the components of research and development expenses included a decrease in personnel-related expenses of $5.4 million and increases in share-based compensation expense of $1.5 million and program-specific costs of $1.2 million.

Within program-specific costs, the primary drivers of change during the three months ended September 30, 2023 as compared to the three months ended September 30, 2022 were an additional expense of $18.6 million related to RVT-3101, which was acquired in November 2022, and a decrease in expenses related to other development and discovery programs of $18.2 million, which in part resulted from the deconsolidation of Proteovant in August 2023 along with the reprioritization of certain programs and drug discovery efforts.

Non-GAAP R&D expenses were $121.9 million for the three months ended September 30, 2023, compared to $123.3 million for the three months ended September 30, 2022.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased by $6.7 million to $164.4 million for the three months ended September 30, 2023, compared to $157.7 million for the three months ended September 30, 2022, primarily due to an increase in selling, general and administrative expenses of $21.8 million at Dermavant as a result of the progression of the commercial launch of VTAMA, partially offset by a decrease of $14.2 million of share-based compensation expense.

Non-GAAP SG&A expenses were $122.1 million for the three months ended September 30, 2023, compared to $101.5 million for the three months ended September 30, 2022. The majority of non-GAAP SG&A expenses were related to Dermavant’s SG&A and ongoing VTAMA commercial launch activities.

Net Loss

Net loss was $331.1 million for the three months ended September 30, 2023, compared to $315.9 million for the three months ended September 30, 2022. On a per common share basis, net loss was $0.40 for the three months ended September 30, 2023, and $0.42 for the three months ended September 30, 2022. Non-GAAP net loss was $225.4 million for the three months ended September 30, 2023, compared to $226.8 million for the three months ended September 30, 2022.