On August 16, 2021 ESSA Pharma Inc. ("ESSA" or the "Company") (NASDAQ: EPIX), a clinical-stage pharmaceutical company focused on developing novel therapies for the treatment of prostate cancer, reported financial results for the fiscal third quarter ended June 30, 2021 (Press release, ESSA, AUG 16, 2021, View Source [SID1234586658]). All references to "$" in this release refer to United States dollars, unless otherwise indicated.
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"During this quarter, the Company continued to focus on the execution of the Phase 1a clinical program of EPI-7386 as a monotherapy in patients with late-stage metastatic castration-resistant prostate cancer ("mCRPC") whose tumors have progressed on multiple current standard-of-care therapies, including antiandrogens," said Dr. David R. Parkinson, M.D., President and Chief Executive Officer of ESSA Pharma Inc. "In this heavily pretreated cohort of patients, EPI-7386 continues to be safe, well-tolerated, with generally good drug exposures, and adverse-events typical of those associated with antiandrogen therapy. Patients are currently being dosed at 600 mg, 800 mg, and 1,000 mg QD, with each of these dose levels being cleared as safe and tolerable. Given the favorable tolerability of the drug and the wide therapeutic window seen in preclinical studies, we plan to enroll additional higher dose cohorts using a twice daily (BID) dosing schedule to further enhance patient drug exposures. In addition, we are planning to file a protocol amendment to focus further monotherapy development in less heavily pretreated patients in whom we believe the androgen receptor pathway continues to be the primary driver of tumor growth. Our goal is to establish a recommended Phase 2 dose ("RP2D") for monotherapy during the first half of 2022 and commence the expansion Phase 1b study soon thereafter in earlier, less heavily pretreated and more biologically characterized patients. We look forward to presenting a clinical readout of the Phase 1a monotherapy trial in the first half of 2022."
Dr. Parkinson continued, "In parallel, our development of EPI-7386 in combination with current antiandrogens in mCRPC patients remains on track. The ESSA-managed clinical trial collaboration with Astellas (enzalutamide) will begin in the fourth quarter of 2021. The EPI-7386 combination studies with other antiandrogens that were announced earlier this year are on track and are anticipated to begin in late 2021 or early 2022. Lastly, using nuclear magnetic resonance studies, we have achieved our long-term preclinical goal of demonstrating definitive evidence that EPI-7386 binds to the N-terminal domain of the androgen receptor and look forward to presenting these results at an upcoming scientific conference this year. As a result of the successful financing earlier this year, our cash and short-term investments of over $202 million provide us a cash runway into 2024 and fully fund the current development programs."
Recent Clinical and Corporate Highlights
On April 28, 2021, the Company announced a clinical collaboration with Bayer to evaluate EPI-7386 in combination with Bayer’s androgen receptor inhibitor darolutamide in patients with metastatic castration-resistant prostate cancer ("mCRPC"). Under the terms of the agreement, Bayer may sponsor and conduct a Phase 1/2 study to evaluate the safety, pharmacokinetics and efficacy of the combination of EPI-7386 and darolutamide in mCRPC patients. ESSA will supply EPI-7386 for the trial and will retain all rights to EPI-7386.
On April 10, 2021, the Company reported new preclinical data on EPI-7386 at the 2021 American Association of Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting demonstrating that in vitro EPI-7386 can prevent the androgen receptor from binding to genomic DNA and can inhibit AR related transcription in prostate cancer cell lines expressing androgen receptor ("AR") splice variants including the AR-v567es variant. The results also demonstrate that combining EPI-7386 with enzalutamide in vitro results in a broader and deeper inhibition of the AR pathway.
Summary Financial Results
Net Loss. ESSA recorded a net loss of $8.8 million ($0.21 loss per common share based on 41,018,024 weighted average common shares outstanding) for the quarter ended June 30, 2021, compared to a net loss of $4.9 million ($0.24 loss per common share based on 20,824,568 weighted average common shares outstanding) for the quarter ended June 30, 2020. For the period ended June 30, 2021, this included non-cash share-based payments of $2.8 million compared to $1.5 million for the prior year, recognized for stock options granted and vesting.
Research and Development ("R&D") expenditures. R&D expenditures for the quarter ended June 30, 2021 were $6.2 million compared to $2.7 million for the quarter ended June 30, 2020 and includes non-cash costs related to share-based payments ($1.2 million for period ended June 30, 2021 compared to $382,941 for period ended June 30, 2020). The increase in R&D expenditures for the third quarter were primarily related to preclinical research with work directed to the completion of the IND filing in March 2020 and chemistry and manufacturing costs in preparation for the Phase 1 study.
General and administration ("G&A") expenditures. G&A expenditures for the quarter ended June 30, 2021 were $3.1 million compared to $2.2 million for the quarter ended June 30, 2020 and include non-cash costs related to share-based payments of $1.5 million for the period ended June 30, 2021 compared to $1.1 million for the period ended June 30, 2020. The increase in the third quarter is the result of increased share-based payments related to the expense recognized in relation to the grant and vesting of these equity instruments.
Liquidity and Outstanding Share Capital
At June 30, 2021, the Company had available cash reserves and short-term investments of $202,263,003 reflecting the gross proceeds of the February 2021 financing of $150.0 million and July 2020 financing of $48.9 million, less operating expenses in the intervening period.
As of June 30, 2021, the Company had 41,854,916 common shares issued and outstanding.
In addition, as of June 30, 2021 there were 5,359,750 common shares issuable upon the exercise of warrants and broker warrants. This includes 5,045,000 prefunded warrants at an exercise price of $0.0001, and 314,750 warrants at a weighted average exercise price of $49.69. There are 6,803,230 common shares issuable upon the exercise of outstanding stock options at a weighted-average exercise price of $5.20 per common share.
About EPI-7386
EPI-7386 is an investigational, highly-selective, oral, small molecule inhibitor of the N-terminal domain of the androgen receptor. EPI-7386 is currently being studied in a Phase 1 clinical trial (NCT04421222) in men with mCRPC whose tumors have progressed on current standard-of-care therapies. The Phase I clinical trial of EPI-7386 began in calendar Q3 of 2020 following FDA allowance of our Investigational New Drug application and Health Canada acceptance. The U.S. FDA has granted Fast Track designation to EPI-7386 for the treatment of adult male patients with mCRPC resistant to standard-of-care treatment. ESSA retains all rights to EPI-7386 worldwide.