On August 10, 2023 Molecular Templates, Inc. (Nasdaq: MTEM, "Molecular Templates," or "MTEM"), a clinical-stage biopharmaceutical company focused on the discovery and development of proprietary targeted biologic therapeutics, engineered toxin bodies ("ETBs"), to create novel therapies with potent differentiated mechanisms of action for cancer, reported financial results and business updates for the second quarter of 2023 (Press release, Molecular Templates, AUG 10, 2023, View Source [SID1234634199]).

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Eric Poma, PhD., Chief Executive and Chief Scientific Officer of MTEM, stated, "ETBs represent a novel approach to the treatment of cancer with differentiated biology and unique mechanisms of action. We expect to see substantial data across all three of our clinical programs with updates throughout this year and into 2024."

Company Highlights

Up to $40 million Private Placement entered with existing and new investors to fund clinical development of MT-6402, MT-8421, and MT-0169
Outstanding debt fully discharged and satisfied in Restructuring Agreement with K2 Health Ventures LLC
MT-0169 screening and enrollment resumed following removal of partial clinical hold on patient enrollment by U.S. Food and Drug Administration
First-in-human phase I study for MT-8421 targeting CTLA-4-expressing regulatory T-cells ("Tregs") in the tumor microenvironment ("TME") for elimination without affecting Tregs in the periphery to begin in 3Q 2023
Clinical data for each program continues to demonstrate novel mechanisms of action, unique pharmacodynamic ("PD") effects, and single agent activity in heavily relapsed / refractory patients across immuno-oncology, hematologic, and solid tumor indications
No instances of capillary leak syndrome or other manifestations of innate immunity have been observed to date with any next-generation ETB
Focus on preclinical activities related to Bristol Myers Squibb collaboration moves forward

July 2023 Private Placement

On July 12, 2023, and as described in Note 14 "Subsequent Events" of the financial statements included in Item 1 of the Quarterly Report on Form 10-Q, we entered into the July 2023 Purchase Agreement which provides for the private placement of shares of our common stock and warrants to purchase shares of our common stock in two tranches. The initial tranche of the July 2023 Private Placement closed on July 17, 2023, and consisted of the issuance of (i) 24,260,644 shares of our common stock at a price of $0.47 per share (the closing price per share of our common stock as reported by the Nasdaq Capital Market on July 12, 2023), and (ii) July 2023 Pre-Funded Warrants exercisable for up to 18,331,547 shares of our common stock. The price of the July 2023 Pre-Funded Warrants was $0.469 per underlying share of our common stock. We received approximately $20 million in gross proceeds in connection with the closing of the initial tranche and net proceeds, following the payment of related offering expenses, of approximately $18.7 million. The second tranche would include gross proceeds of approximately $20 million and would consist of the sale and issuance of an additional 42.6 million shares of common stock (or pre-funded warrants in lieu thereof) on the same pricing terms, and would close if certain conditions were met within the 12 month period described in the July 2023 Purchase Agreement, including requirements that shares of our common stock trade for a 10-day volume weighted average price of at least $1.41 per share with aggregate trading volume during the same 10-day period of at least 10 million shares. In addition, upon this second tranche closing, we would issue to the July 2023 Purchasers Second Closing Warrants representing the right to purchase an additional 85.2 million shares of our common stock at an exercise price of $0.47 per share, in exchange for the payment of $0.125 per underlying share of stock. In the aggregate, these Second Closing Warrants would represent 100% warrant coverage of the number of shares of common stock (or pre-funded warrants) sold in the initial and second tranche, and it would have a term of five years. We intend to use the net proceeds from the July 2023 Private Placement to fund our ongoing clinical studies, working capital and for general corporate purposes and to continue our collaboration activities with BMS.

Restructuring Agreement with K2 HealthVentures LLC ("K2HV")

On June 16, 2023 and as described in Note 8 "Borrowing Arrangements and Debt Extinguishment" in our financial statements included in Item 1 of the Quarterly Report on Form 10-Q, we entered into the Convertible Secured Contingent Value Right Agreement (the "CVR Agreement") with K2HV to fully satisfy and discharge our outstanding secured debt obligations and terminate all other obligations under the existing debt financing facility between us and K2HV in exchange for an aggregate repayment in cash of $27.5 million, the granting of a contingent value right to K2HV and the issuance of a warrant to purchase shares of our common stock to K2HV’s affiliated holder. These contingent value rights require payments to K2HV upon the occurrence of certain events or Acceleration Events described in the CVR Agreement, and payments due for these events is initially capped at $10.3 million which, if not repaid, is subject to various escalating multipliers, as further described in the CVR Agreement. In addition, upon a Change in Control, as defined in the CVR Agreement, we are required to pay an additional payment of $2.5 million. In lieu of a portion of these contingent value rights, K2HV may convert up to $3,000,000 of the Remaining Value, as defined in the CVR Agreement, into an aggregate of 6,124,011 shares of our common stock, subject to adjustment for any stock splits and similar events so long as the number of shares of common stock underlying such conversion right, together with the shares of common stock underlying the warrant, do not exceed 19.99% of the number of shares of our common stock outstanding immediate prior to the execution of the CVR Agreement. In satisfaction of our obligations to issue the warrant to K2HV’s affiliate pursuant to the CVR Agreement, we issued a warrant to purchase up to 5,103,343 shares of our common stock at an exercise price of $0.3919 per share. This warrant has a term of 10 years. To protect its interest in any potential payment of the Remaining Value, K2HV has a security interest in, subject to certain limited exceptions, all assets (including intellectual property) of the Company. Further and pursuant to the terms of the CVR Agreement, we may not (i) incur any indebtedness for borrowed money that is structured as senior or pari passu to K2HV’s outstanding payments without K2HV’s consent or (ii) permit any other liens (other than customary permitted liens) on this collateral without K2HV’s consent.

MT-0169 (CD38 ETB)

MT-0169 was designed to destroy CD38+ tumor cells through internalization of CD38 and cell destruction via a novel mechanism of action (enzymatic ribosomal destruction and immunogenic cell death).
On June 1, 2023, we announced that the U.S. Food and Drug Administration (the "FDA"), after reviewing safety data on the program, removed the partial clinical hold (placed April 2023) on patient enrollment for our MT-0169 trial effective as of May 31, 2023.
In April 2023, the FDA placed the Phase I study for MT-0169 on a partial clinical hold based on previously disclosed cardiac AEs noted in two patients dosed at 50 mcg/kg that prompted the dose reduction to 5 mcg/kg last year. Under the partial clinical hold, current study participants could continue treatment, but no new patients were to be enrolled until the partial hold was lifted by the FDA. We submitted our response to the partial clinical hold to the FDA in May 2023, and the partial clinical hold was lifted by the FDA on May 31, 2023.
Screening and enrollment have resumed for cohort 3 at 15 mcg/kg following a review of the safety data from cohorts 1 (5 mcg/kg) and 2 (10 mcg/kg) in which no cardiac AEs were observed.
Of the patients treated, one patient with extramedullary IgA myeloma treated at 5 mcg/kg has had a marked reduction in IgA serum protein, conversion from immunofixation positive to negative and resolution of uptake on bone scan of skeletal lesions demonstrating a stringent Complete Response ("CR").
The patient’s disease was quad-agent refractory including CD38-targeting antibody, proteosome inhibitor, IMiD, and a BCMA bispecific antibody.
The patient continues on study in a stringent CR at cycle 12.

MT-8421 (CTLA-4 ETB)

MT-8421, along with MT-6402, represent our unique approach to immuno-oncology based on dismantling the TME through direct cell-kill of tumor and immune cells and not only the blocking of ligand-ligand interactions seen with current antibody therapeutics.
The ETB approach includes potent destruction of CTLA4+ regulatory T cells ("Tregs") via enzymatic ribosome destruction, and the mechanism of cell kill is independent of TME.
MT-8421 preferentially destroys high CTLA4 expressing Tregs in the TME relative to peripheral Tregs which are lower CTLA4 expressing.
Clinical sites are open, and we expect the first patient to be enrolled in this Phase 1 study in 3Q 2023.

MT-6402 (PD-L1-targeting ETB with Antigen Seeding Technology)

MT-6402 was designed to activate T-cells through direct cell-kill of immunosuppressive PD-L1+ immune cells. In addition, MT-6402 can deliver and induce the presentation of an MHC class I CMV antigen on tumor cells (antigen seeding mechanism of action) for pre-existing CD8 T-cell recognition and destruction in HLA-A*02/CMV+ patients with high PD-L1 expression on their tumors.
MT-6402 continues to demonstrate PD effects and monotherapy activity in heavily pre-treated checkpoint therapy experienced patients.
Dose escalation in the Phase I study continues as planned for 2023, with one expansion for patients with high PD-L1 tumor expression (≥ 50%) and the other expansion for patients with low (1-49%) PD-L1 tumor expression.
As of June 2023, patients have been treated across seven dose escalation cohorts of 16 mcg/kg, 24 mcg/kg, 32 mcg/kg, 42 mcg/kg, 63 mcg/kg, 83 mcg/kg, and 100 mcg/kg in the MT-6402 study of patients with relapsed/refractory tumors that express PD-L1. We continue to observe pharmacodynamic ("PD") effects including the depletion of PD-L1+ monocytes, MDSCs, PD-L1+ dendritic cells, as well as T cell activation.
One patient with high tumor PD-L1 expression who also had Antigen Seeding capability, demonstrated tumor regression while being dosed with MT-6402 for over 7 months.
This patient, with NSCLC, was treated in cohort 1 (16 mcg/kg) and demonstrated resolution of three osseous lesions and a reduction in uptake in the remaining lesion.
This patient also experienced grade 2 cytokine release syndrome ("CRS") consistent with T-cell activation and was dose reduced to 8 mcg/kg.
This patient had evaluable-only multiple sites of bone disease that appeared to have resolved on bone scan after 3 – 4 months on MT-6402 with only one remaining site which showed decreased uptake.
One patient in cohort 5 (63 mcg/kg) with metastatic squamous cell nasopharynx carcinoma with disease progression after radiation therapy, chemotherapy, and pembrolizumab had a Partial Response ("PR") (RECIST) with a 63% reduction in the index lesion after cycle 2.
The PR was confirmed after cycle 4 with a 71% reduction and the patient remains on treatment and in a response in cycle 10.
This patient’s tumor had 2% PD-L1 expression and was not HLA-A*02, suggesting the response is due to T-cell activation through the clearance of PD-L1+ immune cells. The patient showed a >250% increase in CD8/CD4 T-cell ratios.
To date, treatment-related AEs including immune related AEs have been largely restricted to grade 1 or grade 2.

Research and Collaboration

MTEM continues to expand and develop its unique approach to immuno-oncology targets in collaboration with Bristol Myers Squibb.

Key Milestones for 2023

Accelerating enrollment across all clinical programs
Initiation of first-in-human Phase I study for MT-8421 in 3Q 2023
Advancement of Bristol Myers Squibb research collaboration across multiple targets
MTEM expects to provide periodic updates on MT-6402, MT-8421, and MT-0169 throughout 2023.

Upcoming Conferences

MTEM will make a virtual presentation 7:00am Monday, September 11, 2023, at the H.C. Wainwright 25th Annual Global Conference taking place at the Lotte Palace Hotel in New York, NY from September 11 – 13, 2023. The presentation will be accessible via the corporate website. One-on-one meetings may be scheduled via H.C. Wainwright representative or by directly contacting Molecular Templates.

Financial Results

The net loss attributable to common shareholders for the second quarter of 2023 was $10.9 million, or $0.19 per basic share and per diluted share. This compares with a net loss attributable to common shareholders of $24.4 million, or $0.43 per basic and diluted share, for the same period in 2022.

Revenues for the second quarter of 2023 were $6.9 million, compared to $4.4 million for the same period in 2022. Revenues for the second quarter of 2023 were comprised of revenues from collaborative research and development agreements with Bristol Myers Squibb and grant revenue from CPRIT.

Total research and development expenses for the second quarter of 2023 were $13.4 million, compared with $21.4 million for the same period in 2022. Total general and administrative expenses for the second quarter of 2023 were $5.2 million, compared with $6.6 million for the same period in 2022.

As of June 30, 2023, MTEM’s cash and cash equivalents totaled $5.0 million. Based on the MTEM’s cash and cash equivalents, the proceeds from the first tranche of the July 2023 private placement described above, the anticipated cost-savings from internal restructuring related activities, and other assumptions, management anticipates that MTEM will be able to fund its planned operating expenses and capital expenditure requirements to the third quarter 2024.

On August 10, 2023 Lineage Cell Therapeutics, Inc. (NYSE American and TASE: LCTX), a clinical-stage biotechnology company developing allogeneic cell therapies for unmet medical needs, reported financial and operating results for the second quarter ended June 30, 2023 and will host a conference call today at 4:30 p.m. Eastern Time to discuss these results (Press release, Lineage Cell Therapeutics, AUG 10, 2023, View Source [SID1234634198]).

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"The Lineage team continued to execute across multiple fronts during the second quarter, advancing our clinical and preclinical cell transplant programs and supporting our valuable alliances," stated Brian M. Culley, Lineage CEO. "The most important area of attention was our partnership with Roche and Genentech and continued support for the ongoing Phase 2a clinical study of OpRegen in patients with GA secondary to AMD, which has been enrolling patients from multiple sites in the U.S. Through presentations at medical and scientific conferences, we also sought to increase awareness of OpRegen’s potential to provide durable anatomical and functional improvements to patients with advanced dry AMD. In partnership with CIRM and the Christopher & Dana Reeve Foundation, we created and presented the 1st Annual Spinal Cord Injury Investor Symposium, which brought together stakeholders to share expertise on spinal cord injury and reflects the receipt of a new and clarified path we obtained from FDA for an IND amendment for our OPC1 program. We also reported positive clinical results from a Phase 1 study of VAC2 in non-small cell lung cancer alongside our partner, Cancer Research UK. Looking ahead, we will continue to focus on making progress across our pipeline while maintaining our rigorous commitment to disciplined spending. Overall, we believe the use of differentiated allogeneic cell transplants can provide a meaningful impact for patients and are encouraged by the progress we and others have made in this field."

Recent milestones and activities included:

RG6501 (OpRegen)
Continued execution under our collaboration with Roche and Genentech across multiple functional areas, including support for the ongoing Phase 2a multi-center clinical study in patients with geographic atrophy (GA) secondary to age-related macular degeneration (AMD):
Additional sites expected to come online this year for the Phase 2a study.
Preliminary evidence of durable anatomical and functional improvements following administration of OpRegen cells from the Phase 1/2a clinical study was presented at 2023 Association for Research in Vision and Ophthalmology (ARVO) Annual Meeting and other medical and scientific meetings, including durable improvement observed in one patient with long-term follow-up available (4 years).
Type B meeting response from FDA facilitates IND amendment submission for clinical testing of novel OPC1 spinal cord delivery system
IND amendment preparation underway, with plans to submit to FDA in Q4.
Announced encouraging topline results from Phase 1 clinical study of VAC2 in advanced non-small cell lung cancer (NSCLC) in partnership with Cancer Research UK (CRUK)
VAC2 appeared to be well tolerated in all treated patients and the adverse events observed were modest and expected from a therapy designed to generate a robust and durable immune response to tumor antigens.
Response data in these refractory patients was encouraging with five of eight participants demonstrating a best response of immune-related stable disease and three patients demonstrating immune-related progressive disease. Three of eight treated patients also reached the 2-year survival endpoint.
Two patients demonstrated durable responses against segments of the applicable tumor antigen and two other patients had transient responses as assessed via enzyme-linked immunospot (ELISPOT) assays.
Added to the broad-market Russell 3000 Index
Our inclusion in the broader index can help to expand investor awareness, increase institutional ownership, and provide additional liquidity in our stock.
Established and presented the 1st Annual Spinal Cord Injury Investor Symposium (SCIIS).
The goals of this collaborative effort included an increase in disease awareness, improving the probability of success in product development, and supporting clinical trial participation by focusing on topics such as patient-appropriate clinical endpoints. We are grateful to the sponsors and collaborators for this inaugural event, including CIRM, the Christopher & Dana Reeve Foundation, the Sanford Stem Cell Institute at the University of California San Diego, and AbbVie.
Balance Sheet Highlights

Cash, cash equivalents, and marketable securities totaled $45.9 million as of June 30, 2023, which is expected to support planned operations into Q4 2024.

Second Quarter Operating Results

Revenues: Lineage’s revenue is generated primarily from licensing fees, royalties, collaboration revenues, and research grants. Total revenues for the three months ended June 30, 2023 were $3.2 million, a net decrease of $1.4 million as compared to approximately $4.6 million for the same period in 2022. The decrease was primarily driven by less collaboration and licensing revenue recognized from deferred revenues from the Roche Agreement.

Operating Expenses: Operating expenses are comprised of research and development ("R&D") expenses and general and administrative ("G&A") expenses. Total operating expenses for the three months ended June 30, 2023 were $8.1 million, a decrease of $0.5 million as compared to $8.6 million for the same period in 2022.

R&D Expenses: R&D expenses for the three months ended June 30, 2023 were $3.9 million, a net increase of $0.6 million as compared to $3.3 million for the same period in 2022. The net increase was primarily driven by $0.4 million in higher OpRegen program-related expenses, and $0.3 million in non-clinical-related expenses to support the OPC1 program.

G&A Expenses: G&A expenses for the three months ended June 30, 2023 were $4.2 million, a net decrease of approximately $1.1 million as compared to $5.3 million for the same period in 2022. The decrease was primarily driven by $0.5 million in lower litigation and legal expenses, and an overall reduction in costs incurred for services by third parties, consulting costs, and stock-based compensation expense.

Loss from Operations: Loss from operations for the three months ended June 30, 2023 was $5.0 million, an increase of $0.8 million as compared to $4.2 million for the same period in 2022.

Other Income/(Expenses), Net: Other income (expenses), net for the three months ended June 30, 2023 reflected other expense, net of ($0.2) million, compared to other expense, net of ($2.5) million for the same period in 2022. The net change was primarily driven by exchange rate fluctuations related to Lineage’s international subsidiaries, fair market value changes in marketable equity securities, and interest income from our marketable debt securities.

Net Loss Attributable to Lineage: The net loss attributable to Lineage for the three months ended June 30, 2023 was $5.2 million, or $0.03 per share (basic and diluted), compared to a net loss attributable to Lineage of $6.8 million, or $0.04 per share (basic and diluted), for the same period in 2022.

Conference Call and Webcast

Interested parties may access today’s conference call and webcast, by dialing (800) 715-9871 from the U.S. and Canada and should request the "Lineage Cell Therapeutics Call". A live webcast of the conference call will be available online in the Investors section of Lineage’s website. A replay of the webcast will be available on Lineage’s website for 30 days and a telephone replay will be available through August 17, 2023, by dialing (800) 770-2030 from the U.S. and Canada and entering conference ID number 1144985.

On August 10, 2023 Kezar Life Sciences, Inc. (Nasdaq: KZR), a clinical-stage biotechnology company discovering and developing breakthrough treatments for immune mediated and oncologic disorders, reported financial results for the second quarter ended June 30, 2023 and provided a business update (Press release, Kezar Life Sciences, AUG 10, 2023, View Source [SID1234634197]).

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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

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"This quarter, we’ve been laser-focused on executing on our three ongoing clinical trials to validate the broad potential of our product candidates," said John Fowler, Kezar’s Co-Founder and Chief Executive Officer. "Now actively recruiting patients, our PALIZADE and PORTOLA clinical trials are designed to demonstrate zetomipzomib’s potential to be a steroid-sparing, immunomodulating treatment for multiple autoimmune conditions. Our first-in-class protein secretion inhibitor, KZR-261, continues to demonstrate a favorable safety and tolerability profile as we proceed with our dose-escalation study, and represents only the first of several potential assets generated by our Sec61 translocon inhibition platform. I commend the Kezar team for their hard work and unwavering commitment to our mission of delivering novel treatments to patients fighting difficult-to-treat chronic diseases."

Zetomipzomib: Selective Immunoproteasome Inhibitor

PALIZADE – Phase 2b clinical trial of zetomipzomib in patients with active lupus nephritis (LN) (ClinicalTrials.gov: NCT05781750)

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PALIZADE is a global, placebo-controlled, randomized, double-blind Phase 2b clinical trial evaluating the efficacy and safety of two dose-levels of zetomipzomib in patients with active LN. Target enrollment will be 279 patients, randomly assigned (1:1:1) to receive 30 mg of zetomipzomib, 60 mg of zetomipzomib or placebo subcutaneously once weekly for 52 weeks, in addition to standard background therapy. Background therapy can, but will not be mandated to, include standard induction therapy. Over the initial 16 weeks, there will be a mandatory corticosteroid taper to 5 mg per day or less. End-of-treatment assessments will occur at Week 53. The primary efficacy endpoint is the proportion of patients who achieve a complete renal response (CRR) at Week 37, including a urine protein-to-creatine ratio (UPCR) of 0.5 or less without receiving rescue or prohibited medications.
PORTOLA – Phase 2a clinical trial of zetomipzomib in patients with autoimmune hepatitis (AIH) who have not benefited from standard-of-care treatment (ClinicalTrials.gov: NCT05569759)

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PORTOLA is a placebo-controlled, randomized, double-blind Phase 2a clinical trial evaluating the efficacy and safety of zetomipzomib in patients with AIH that are insufficiently responding to standard of care or have relapsed. Target enrollment will be 24 patients, randomized (2:1) to receive 60 mg of zetomipzomib or placebo in addition to background corticosteroid therapy for 24 weeks, with a protocol-mandated steroid taper by Week 14. The primary efficacy endpoint will measure the proportion of patients who achieve a complete response measured as normalization of alanine aminotransferase (ALT) and aspartate aminotransferase (AST) levels with a successful corticosteroid taper by Week 24.
MISSION – Completed open-label Phase 2 clinical trial of zetomipzomib in patients with active LN (ClinicalTrials.gov: NCT03393013)

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The post-hoc analysis across LN biopsy classes from the open-label Phase 2 MISSION clinical trial was presented as a poster presentation at the National Kidney Foundation (NKF) Spring Clinical Meeting 2023, which took place April 11-15, 2023 in Austin, Texas.
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The complete MISSION Phase 1b/2 results, along with a post hoc subgroup analysis in the Phase 2 Hispanic/Latino population, were presented as a poster presentation at the Pan American League of Associations for Rheumatology (PANLAR) 2023 Congress, which took place April 26-29, 2023 in Rio de Janeiro, Brazil.
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The complete MISSION Phase 1b/2 results were presented as an oral presentation at the LUPUS & KCR 2023 meeting, which took place May 17-20, 2023 in Seoul, Korea.
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The complete MISSION Phase 2 results, MISSION Phase 2 uCD163 data, and the unmet need of European patients with LN were presented as poster presentations at the European Alliance of Associations for Rheumatology (EULAR) 2023 Congress, which took place May 31 – June 3, 2023 in Milan, Italy.
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The post-hoc analysis of MISSION Phase 2 patients with nephrotic range proteinuria and the unmet need of European patients with LN were presented as oral presentations at the 60th European Renal Association (ERA) Congress, which took place June 15-18, 2023 in Milan, Italy.
Protein Secretion Inhibition Platform

KZR-261: Broad-Spectrum Sec61 Translocon Inhibitor

KZR-261-101 – Phase 1 clinical trial of KZR-261 in patients with locally advanced or metastatic solid malignancies (ClinicalTrials.gov: NCT05047536)

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The Phase 1 clinical trial of KZR-261 is being conducted in two parts: dose escalation and dose expansion in four tumor-specific solid tumors and one all-tumor cohort. The study is designed to evaluate safety and tolerability, pharmacokinetics and pharmacodynamics, identify a recommended Phase 2 dose and to explore the preliminary anti-tumor activity of KZR-261 in patients with locally advanced or metastatic disease.

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The KZR-261 trial is currently enrolling Cohort 7 (40 mg/m2). Previously, Cohort 1 (1.8 mg/m2) through Cohort 6 (27 mg/m2) enrolled a total of 24 patients and completed rapid dose escalation without significant safety concerns.
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To date, KZR-261 has shown dose-proportional exposure and no signs of accumulation or altered pharmacokinetics with repeated dosing.
Financial Results

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Cash, cash equivalents and marketable securities totaled $236.6 million as of June 30, 2023, compared to $276.6 million as of December 31, 2022. The decrease was primarily attributable to cash used in operations to advance clinical-stage programs and preclinical research and development.
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Research and development expenses for the second quarter of 2023 increased by $9.7 million to $21.0 million compared to $11.3 million in the second quarter of 2022. This increase was primarily due to advancing the zetomipzomib clinical program in multiple indications and the KZR-261 clinical program and an increase in compensation and personnel related expenses, including non-cash stock-based compensation expense, as a result of an increase in headcount.
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General and administrative (G&A) expenses for the second quarter of 2023 increased by $0.8 million to $5.8 million compared to $5.0 million in the second quarter of 2022. The increase was primarily due to an increase in compensation and personnel related expenses, including non-cash stock-based compensation, as a result of an increase in headcount.
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Net loss for the second quarter of 2023 was $24.3 million, or $0.34 per basic and diluted common share, compared to a net loss of $16.2 million, or $0.25 per basic and diluted common share, for the second quarter of 2022.
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Total shares of common stock outstanding were 72.5 million shares as of June 30, 2023. Additionally, there were options to purchase 13.0 million shares of common stock at a weighted-average exercise price of $7.43 per share and 0.4 million restricted stock units outstanding as of June 30, 2023.

On August 10, 2023 IN8bio, Inc. (Nasdaq: INAB), a leading clinical-stage biopharmaceutical company developing innovative gamma-delta T cell therapies, reported financial results and operational highlights for the second quarter ended June 30, 2023 (Press release, In8bio, AUG 10, 2023, View Source [SID1234634196]). In addition, the Company provided an overview of recent corporate developments through August 2023.

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"We made significant clinical advancements in our gamma-delta T cell programs in the second quarter of 2023, sharing encouraging positive data from our INB-100 and INB-200 programs at major medical meetings as well as increasing enrollment across our clinical pipeline," said William Ho, CEO and co-founder of IN8bio. "We were honored to be selected as one of only four oral presentations and the only Phase 1 program for central nervous system tumors at the ASCO (Free ASCO Whitepaper) 2023 Annual Meeting. The positive clinical data from both of our Phase 1 trials continues to demonstrate the potential of gamma-delta T cell therapy in preventing relapse and ultimately prolonging survival in patients with these devastating diseases. Our clinical programs investigate the safety, durability and potential utility of gamma-delta T cells as a much-needed treatment option for cancer patients. We look forward to providing additional updates at medical meetings this fall."

Business Highlights and Recent Developments

Presented positive INB-200 Phase 1 data update in GBM showing 100% of treated patients (n=8) to date have exceeded median progression-free survival at the ASCO (Free ASCO Whitepaper) 2023 Annual Meeting. Results support the potential of DeltEx drug resistant immunotherapy (DRI) to improve progression-free survival and overall survival in patients with newly diagnosed GBM, demonstrating that multiple doses in later cohorts did not lead to any changes in toxicity profile. The Company is on track to complete INB-200 Phase 1 study enrollment in 2023 with updated data expected to be presented later this year.
Presented new promising preclinical data underscoring the potential of DeltEx gamma-delta T cells to target and kill ovarian cancer cells at the ASGCT (Free ASGCT Whitepaper) 26th Annual Meeting. The results showcased the powerful synergistic potential of combining gamma-delta T cells and chemotherapy to enhance their ability to recognize and eradicate cancer cells across a broad range of challenging cancer indications beyond the brain and has the potential to be developed as a novel therapy for ovarian cancer.
Announced upcoming R&D Day in October. The Company will be hosting an R&D Day on Thursday, October 12, 2023 in New York City, with details to follow.
Announced opening of advanced R&D facility in Birmingham. The Company recently announced that it has opened a new R&D facility in Birmingham, AL. Complementing the Company’s current GMP manufacturing spaces, this facility will play a vital role in enhancing the Company’s preclinical R&D and process development capabilities. These facilities will be instrumental in advancing our groundbreaking pipeline of gamma-delta T cell therapies, setting the stage for future clinical and pipeline developments.
Second Quarter 2023 Financial Highlights

Research and Development expenses: R&D expenses were $4.1 million for the three months ended June 30, 2023, compared to $3.5 million for the comparable prior year period. The increase in R&D expenses was primarily due to (i) contract research organization expenses related to the initiation of INB-400, (ii) completion of additional lentiviral vector manufacturing to support the INB-400 program and (iii) increased personnel-related costs, including salaries, benefits, and stock-based compensation due to increased headcount.
General and administrative expenses: General and administrative expenses were $3.6 million for the three months ended June 30, 2023, compared to $3.7 million for the comparable prior year period. The decrease was primarily due to cost savings related to D&O insurance premiums and reductions in professional services.
Net loss: The Company reported a net loss of $7.7 million, or $0.27 per basic and diluted common share, for the three months ended June 30, 2023, compared to a net loss of $7.2 million, or $0.38 per basic and diluted common share, for the comparable prior year period.
Cash: As of June 30, 2023, the Company had cash of $17.0 million, compared to $10.9 million as of March 31, 2023.

On August 10, 2023 IMUNON, Inc. (NASDAQ: IMNN), a clinical-stage drug-development company focused on developing non-viral DNA-mediated immuno-oncology therapies and next-generation vaccines, reported financial results for the three and six months ended June 30, 2023 (Press release, IMUNON, AUG 10, 2023, View Source [SID1234634195]). The Company also provided an update on its clinical development programs with IMNN-001 (formerly GEN-1), a DNA-based interleukin-12 (IL-12) immunotherapy in Phase 2 clinical development for the treatment of advanced-stage ovarian cancer, and on its PlaCCine modality, a proprietary mono- or multi-cistronic non-viral and synthetic DNA technology for the expression of pathogen antigens, being evaluated in preclinical studies for the development of next-generation vaccines.

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Highlights of the second quarter of 2023 and recent weeks include:

On track to submit an Investigational New Drug (IND) application in the first quarter of 2024 for a proposed Phase 1/2 program with a seasonal COVID-19 booster vaccine, following positive pre-IND feedback from the U.S. Food and Drug Administration (FDA)
Reported data suggesting PlaCCine vaccines elicit robust and more durable T-cell responses than commercial mRNA vaccines, signaling that these vaccines may provide greater protection against reinfection, hospitalization or death
Unveiled new current Good Manufacturing Practices (cGMP) clinical materials production facility to support R&D efficiencies and lower costs for infectious disease and cancer vaccines, and non-viral DNA-based immune-oncology therapies
Reported cash and cash equivalents of $24.1 million as of June 30, 2023, which along with planned sales of State of New Jersey net operating losses (NOLs) is expected to fund operations through 2024
"We have now successfully de-risked our PlaCCine modality preclinically across many pathogens of interest by demonstrating in animal models the immunogenicity and safety of our vaccines. We have generated compelling data in SARS-CoV-2 and with IMNN-101, a next-generation COVID-19 seasonal booster, and expect to be in the clinic in first quarter of 2024. In addition, we have generated excellent immunological responses for vaccines against other pathogens of concern including monkeypox, flu and arenaviruses. Our DNA vaccines are well positioned to become the next generation of vaccines and I am excited about their potential with the demonstration preclinically of durability of IgG antibody response, without a booster dose, and higher T-cell activation than mRNA vaccines. Another significant advantage over commercial mRNA vaccines is the demonstration of more than 12 months stability at standard refrigerated temperature of 4°C," said Dr. Corinne Le Goff, IMUNON’s President and Chief Executive Officer.

"Based on positive FDA feedback in July from a pre-IND meeting for our seasonal COVID-19 booster vaccine, we are on track to submit an IND application in the first quarter of 2024. The FDA confirmed in a written response that our plug-and-play strategy for our platform approach was acceptable. This confirms the flexibility and versatility of our platform, which allows for the rapid production and development of any vaccine simply by changing the antigen coding cassette. In addition, we expect to announce our next pathogen target for our PlaCCine modality in the coming weeks."

Dr. Le Goff continued, "In June we unveiled our new pilot manufacturing capability for DNA plasmids and nanoparticle delivery systems. Our scientists are now able to select any protein from the human or pathogen proteomes to be engineered. Our existing labs also have the ability to conduct testing and to run experiments in a variety of animal disease models. These internal capabilities will allow us to control both the costs and the process. The objective of our vaccine program is to establish the platform’s safety and efficacy in various Phase 1 studies, and then seek to license this powerful technology and/or establish non-dilutive partnerships to develop vaccines for pathogens of interest," she added.

"We expect to reach several value-creating milestones over the next six to 18 months. Among them is reporting additional interim data on IMNN-001 from our OVATION 2 Study and the combination study with bevacizumab in advanced ovarian cancer, reporting topline data from the OVATION 2 Study, filing the IND for our SARS-CoV-2 vaccine and announcing proof-of-concept vaccine data for our next pathogen target. We intend to discuss all of this and more during a virtual R&D Day event we are planning for this fall," Dr. Le Goff concluded.

RECENT DEVELOPMENTS

PlaCCine: Developing the Prophylactic Vaccines of the Future

Publication of Preclinical Data with PlaCCine DNA-based Vaccines Modality Available Online on bioRxiv. In August 2023 the Company announced that a manuscript titled "Strong immunogenicity & protection in mice with PlaCCine: A COVID-19 DNA vaccine formulated with a functional polymer" is available on the preprint server bioRxiv [here]. The study used IMUNON’s proprietary formulation against the spike proteins from two SARS-CoV-2 variants, both alone and in combination. These results add to the growing body of preclinical data confirming the efficacy and superior desirable features of IMUNON’s PlaCCine vaccine modality. Data from the study show:

IMUNON’s proprietary formulation of functionalized polymer protected DNA from degradation, while the combination with an adjuvant led to an increase in protein expression
DNA formulated with PlaCCine resulted in a DNA vaccine product that was stable for up to one year at 4°C
DNA formulated in PlaCCine resulted in the induction of spike-specific neutralizing antibodies and cytotoxic T cells
In the in vivo challenge model, the vaccine-induced immune response was capable of suppressing viral replication
Multiple inserts can be cloned into the PlaCCine backbone (a plug-and-play strategy), therefore allowing for an immune response with broader protection
Presentation at the 2023 Viruses and Cells – Gordon Research Conference Describes Compelling Preclinical Data Showing Continued Durability of Response Over 14 Months with Humoral Immune Response Increasing Over Time. In May 2023 Khursheed Anwer, Ph.D., IMUNON’s Executive Vice President and Chief Science Officer, presented new PlaCCine preclinical data at the 2023 Viruses and Cells – Gordon Research Conference in Barcelona. Dr. Khursheed’s presentation, titled "A Novel DNA Vaccine Approach to Prophylactic and Therapeutic Vaccines," described IMUNON’S PlaCCine technology platform for the development of next-generation vaccines, and is available here.

Results from preclinical studies in a PlaCCine COVID-19 vaccine demonstrated characteristics that address the limitations of current commercial vaccines by offering enhanced breadth of protection to emerging variants, persistence and robust cellular immunity, as well as stability at workable temperatures. Importantly, humoral immune responses specific to the SARS-CoV-2 spike antigen were persistent over a 14-month post-vaccination period in mice, while the T-cell responses from PlaCCine COVID-19 vaccines after 14 months were higher than a commercial mRNA vaccine. In another mouse study, the humoral response to a single dose of a commercial mRNA vaccine plateaued within 14 days after vaccination while the response continued to increase over time with a PlaCCine vaccine, demonstrating improved durability. In addition, PlaCCine was stable for at least nine months at refrigerated temperatures and for at least one month at room temperature.

Presentation at the Vaccine Technology Summit 2023 Describes Compelling Preclinical Data Supporting Continued Development of PlaCCine as a Differentiated, Next-Generation Vaccine. In March 2023 Dr. Anwer presented data on the Company’s PlaCCine platform at the Vaccine Technology Summit 2023 in Boston. Dr. Anwer’s presentation is titled "A Novel DNA Vaccine Platform with Potential to Create Next Generation Vaccines" and is available here.

Dr. Anwer reviewed the Company’s work in advancing its PlaCCine modality and the promising preclinical data generated to date. Among topics presented was the ability of this multi-valent technology to achieve broad-spectrum immunity from a single DNA plasmid with a synthetic delivery system that is independent of virus, device or liquid nanoparticle formulations. The data presented showed:

Robust immunogenicity and protection in SARS-CoV-2 models
Durable cellular or humoral responses detectable for more than 12 months
Comparable protection activity to a commercial mRNA vaccine in a booster-dose comparison
Superior immune quality versus the mRNA vaccine in a single-dose comparison
In addition, the PlaCCine modality had important advantages for a commercial vaccine, including a shelf-life at 4⁰C for greater than nine months, and the ability for simple, rapid and scalable manufacturing.

IMNN-001 Immunotherapy

Presentation at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Describes Findings from Mouse Model of Peritoneally Disseminated Ovarian Cancer that Suggest Biweekly Dosing Regimen for Further Evaluation in Human Clinical Studies. In April 2023 Jean Boyer, Ph.D., IMUNON’s Vice President of Preclinical Research, presented a poster titled "Efficacy of IMNN-001, an Interleukin-12 Immune Gene Therapy, at Different Dose Frequencies" at the AACR (Free AACR Whitepaper) in Orlando, which is available here.

Researchers concluded that IMNN-001 demonstrated stimulation of the immune response in the ID8 ovarian tumor model. Of the three dosing regimens tested, the once every 2-week regimen demonstrated comparability to the weekly regimen while showing superiority over the once every 3-week regimen, particularly with respect to mortality and tumor burden. These findings suggest exploring once every 2-week dosing of IMNN-001 in human studies, which is already incorporated into the protocol of a new study evaluating IMNN-001 in combination with bevacizumab in the treatment of advanced ovarian cancer. This study is sponsored by the Break Through Cancer Foundation.

Corporate Developments

IMUNON Unveils New Manufacturing Facility at Huntsville’s HudsonAlpha Biotech Campus. In June 2023, the Company unveiled its new cGMP clinical materials production facility on the Huntsville, Alabama campus of the HudsonAlpha Institute for Biotechnology. The facility is intended to support R&D efficiencies and lower development costs for infectious disease and cancer vaccines, and non-viral DNA-based immune-oncology therapies. This new capability complements the Company’s existing cGMP quality control facility for testing clinical products at the Huntsville site.

IMUNON has designed and built its own manufacturing capabilities to produce GMP-grade plasmid DNA (pDNA) and DNA-facilitating agents to support Phase 1 clinical studies with its PlaCCine infectious disease modality and its IndiPlas and FixPlas cancer vaccine modalities. The new facility’s specifications follow the 2008 FDA guidance cGMP for Phase 1 investigational drugs. The pDNA and DNA facilitating agents are key components of the final vaccine formulation, with GMP fill and finish carried out at a CDMO partner site.

IMUNON’s CEO Presents Business Overview at BIO 2023 International Convention and Mass General Brigham World Medical Innovation Forum 2023. Dr. Le Goff provided an overview of IMUNON’s business progress to an audience of investors and biopharmaceutical professionals at the BIO 2023 International Convention and at the Mass General Brigham World Medical Innovation Forum 2023, both in Boston. She highlighted the strength of IMUNON’s leadership team, and the status of the Company’s TheraPlas nucleic acid therapeutics platform and its PlaCCine nucleic acid vaccine platform while providing context on the promise of DNA as a therapeutic and a vaccine. For the PlaCCine and TheraPlas technologies, Dr. Le Goff described mechanisms of action and provided a closer look at the promising clinical results generated to-date. She provided background on the use of DNA in these medicines, characterizing its performance in terms of durability, development speed and ease of manufacturing, shipping and storage. Dr. Le Goff also highlighted the potential of IMNN-001 for the treatment of ovarian cancer during a panel discussion. Dr. Le Goff’s presentation is available here.

SECOND QUARTER FINANCIAL RESULTS

IMUNON reported a net loss for the second quarter of 2023 of $5.6 million, or $0.61 per share, compared with a net loss of $6.0 million, or $0.87 per share, for the second quarter of 2022. Operating expenses were $5.5 million for the second quarter of 2023, a decrease of $0.6 million, or 10%, from $6.1 million for the second quarter of 2022.

Net cash used for operating activities was $6.8 million for the second quarter of 2023 compared with $5.4 million for the comparable prior-year period. The increase was primarily due to the cash settlement in April 2023 along with related legal fees for arbitration with a former contract manufacturer for ThermoDox. Cash used by financing activities of $6.2 million during the second quarter of 2023 resulted from the early repayment of the Company’s loan facility with Silicon Valley Bank, offset by equity sales under the Company’s At-the-Market Equity Facility. The Company had $24.1 million in cash, investments and accrued interest receivable as of June 30, 2023. Combined with $1.8 million in planned future sales of IMUNON’s State of New Jersey NOLs, the Company believes it has sufficient capital resources to fund its operations through 2024.

Research and development (R&D) expenses were $3.1 million for the second quarter of 2023 compared with $3.2 million for the comparable period in 2022. R&D costs to support the OVATION 2 Study as well as the Phase 3 OPTIMA Study decreased to $0.3 million for the second quarter of 2023 compared with $0.8 million for the same period of 2022. Other clinical and regulatory costs were $0.4 million for the second quarter of 2023 compared with $0.7 million for the second quarter of 2022. R&D costs associated with the preclinical development of the PlaCCine DNA vaccine modality increased to $1.3 million for the second quarter of 2023 compared with $0.6 million for the same period of 2022. R&D costs associated with the preclinical development of IMNN-001 decreased to $0.4 million for the second quarter of 2023 compared with $0.8 million for the same period of 2022. Chemistry, manufacturing and controls (CMC) costs increased to $0.7 million for the second quarter of 2023 compared with $0.3 million for the second quarter of 2022 due to higher costs related to the development of in-house pilot manufacturing capabilities for DNA plasmids and nanoparticle delivery systems.

General and administrative expenses were $2.3 million for the second quarter of 2023 compared with $2.9 million for the comparable prior-year period. The decrease was primarily due to lower non-cash stock-compensation expense and lower professional fees, including legal fees to defend various lawsuits filed after the announcement in July 2020 of the Phase 3 OPTIMA Study results, offset by higher compensation expenses related to the CEO succession plan announced in July 2022 and higher staffing costs.

Other non-operating expenses were $85 thousand for the second quarter of 2023 compared with $65 thousand for the prior-year period. The Company incurred early debt extinguishment expense on its loan facility with Silicon Valley Bank totalling $0.3 million, offset by higher investment income from the Company’s short-term investments due to higher returns on these investments.

FIRST HALF FINANCIAL RESULTS

For the six months ended June 30, 2023, the Company reported a net loss of $11.2 million, or $1.28 per share, compared with a net loss of $16.5 million, or $2.59 per share, for the same period of 2022. Operating expenses were $11.2 million for the first six months of 2023, a decrease of $0.9 million, or 8%, from $12.1 million for the same period of 2022.

Net cash used for operating activities was $10.8 million for the first six months of 2023 compared with $13.4 million for the same period in 2022. The decrease was primarily due to the one-time payment of $4.5 million in interest expense resulting from the sale and subsequent redemption of $30 million of Series A & B convertible redeemable preferred stock in the first quarter of 2022. The Company’s projected cash utilization for the balance of 2023 is approximately $4.5 million per quarter. Cash used by financing activities of $3.7 million during the first six months of 2023 resulted from the early repayment of the Company’s loan facility with Silicon Valley Bank ($6.4 million), offset by sales of equity under the Company’s At-the-Market Equity Facility ($2.7 million). The Company also received net proceeds of $1.6 million from the sale of its unused New Jersey NOLs in the first quarter of 2023.

R&D expenses were $5.8 million for the first six months of 2023 compared with $6.3 million for the comparable period in 2022. R&D costs to support the OVATION 2 Study as well as the Phase 3 OPTIMA Study decreased to $0.6 million for the first six months of 2023 compared with $1.3 million for the comparable 2022 period. Other clinical and regulatory costs were $0.7 million for the first six months of 2023 compared with $1.5 million for the same period of 2022. R&D costs associated with the preclinical development of the PlaCCine DNA vaccine modality increased to $2.3 million for the first six months of 2023 compared with $1.2 million for the same period of 2022. R&D costs associated with the preclinical development of IMNN-001 decreased to $0.8 million for the first half of 2023 compared with $1.7 million for the same period of 2022. CMC costs increased to $1.4 million for the first six months of 2023 compared with $0.6 million for the comparable 2022 period due to higher costs related to the development of in-house pilot manufacturing capabilities for DNA plasmids and nanoparticle delivery systems.

General and administrative expenses were $5.4 million for the first six months of 2023 compared with $5.7 million for the same period of 2022. The $0.3 million decrease was primarily attributable to lower non-cash stock-compensation expense, offset by higher compensation expenses related to the CEO succession plan announced in July 2022 and higher staffing costs.

Other non-operating income was $9 thousand for the first six months of 2023 compared with $4.7 million for the comparable prior-year period. The decrease was primarily attributable to the one-time payment of $4.5 million in interest expense resulting from the sale and subsequent redemption of $30 million of Series A & B convertible redeemable preferred stock in the first quarter of 2022.

VIRTUAL R&D DAY EVENT

IMUNON management along with several guest key opinion leaders plan to host a virtual R&D Day event this fall to discuss the Company’s progress in developing its PlaCCine platform, IMNN-001, and other achievements. Presenters will also review strategic plans and opportunities for IMUNON. Additional information including date, time of day and instructions to participate will be announced in a separate news release.

CONFERENCE CALL AND WEBCAST

The Company is hosting a conference call to provide a business update, discuss second quarter 2023 financial results and answer questions at 11:00 a.m. EDT today. To participate in the call, please dial 866-777-2509 (Toll-Free/North America) or 412-317-5413 (International/Toll) and ask for the IMUNON Second Quarter 2023 Earnings Call. A live webcast of the call will be available here.

The call will be archived for replay until August 24, 2023. The replay can be accessed at 877-344-7529 (U.S. Toll-Free), 855-669-9658 (Canada Toll-Free) or 412-317-0088 (International Toll), using the replay access code 1202020. A webcast of the call will be available here for 90 days.