On March 11, 2021 Sierra Oncology, Inc. (SRRA), a late-stage biopharmaceutical company on a quest to deliver targeted therapies that treat rare forms of cancer, reported its financial and operational results for the fourth quarter and fiscal year ended December 31, 2020 (Press release, Sierra Oncology, MAR 11, 2021, View Source [SID1234576515]).
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"We are excited to enter the final phase of patient recruitment for MOMENTUM. Trial enrollment remains on track, and we anticipate closing screening in the first half of the year," said Stephen Dilly, MBBS, PhD, President and CEO of Sierra Oncology. "Two important retrospective analyses from the SIMPLIFY studies were presented in December 2020 at the American Society of Hematology (ASH) (Free ASH Whitepaper). Long-term survival in both JAK inhibitor-naïve and JAK inhibitor-exposed patients highlighted momelotinib’s disease modifying potential, and, efficacy in patients with reduced platelets added to the totality of evidence supporting momelotinib’s unique and differentiated profile.
"We are now looking forward to completing enrollment of our pivotal Phase 3 MOMENTUM study, analyzing and presenting topline data, and preparing internally for commercialization. Results of the MOMENTUM study, combined with the SIMPLIFY data sets, will support future regulatory filings and the potential approval of momelotinib for the treatment of myelofibrosis."
Recent and Upcoming Business Highlights
Pivotal Phase 3 MOMENTUM study is on track to complete enrollment by mid-2021. Top-line data are anticipated in H1 2022
Following top-line data availability, Sierra anticipates filing for regulatory approval of momelotinib in H2 2022
Robust overall survival and sustained efficacy outcome data from the previously completed SIMPLIFY studies presented at American Society of Hematology (ASH) (Free ASH Whitepaper) annual meeting in December 2020
Long-term safety and dose intensity data presented at European Hematology Association (EHA) (Free EHA Whitepaper) annual meeting in June 2020
Significant executive appointments made in preparation for commercial execution: Chief Executive Officer, Stephen Dilly, Chief Business Officer, Kevin Norrett, General Counsel, Christina Thomson and Chief Regulatory & Technical Operations Officer, William Turner
Amendment to CRT Pioneer Fund agreement for SRA737 allowing for potential future development of the compound
Year End 2020 Financial Results (all amounts reported in U.S. currency)
Research and development expenses were $45.1 million for the year ended December 31, 2020 compared to $53.2 million for the year ended December 31, 2019. The decrease was primarily due to a non-cash charge of $10.5 million that was recognized during the year ended December 31, 2019 pertaining to an obligation to issue common stock and a warrant to Gilead Sciences, Inc. (Gilead) in consideration for meaningfully reduced royalty rates and the elimination of a milestone payment, partially offset by a $1.5 million non-cash charge during the year ended December 31, 2020 to recognize the change in fair value of the securities until their issuance in January of 2020. Also contributing to the decrease was a reduction of $7.6 million in clinical trial, third-party manufacturing, and research and preclinical costs for SRA737 and a $0.9 million decrease in personnel-related and allocated overhead costs for the year ended December 31, 2020. These decreased costs were offset by a $9.4 million increase in clinical trial and development costs related to momelotinib for the year ended December 31, 2020. Research and development expenses included non-cash stock-based compensation of $4.3 million and $3.9 million for the year ended December 31, 2020 and 2019, respectively.
General and administrative expenses were $20.1 million for year ended December 31, 2020, compared to $13.7 million for the year ended December 31, 2019. The increase was due to a $4.9 million increase in personnel-related and allocated overhead costs, including a $3.4 million increase in non-cash stock-based compensation and $1.0 million of severance charges that were primarily related to the resignation of an executive, and an increase of $1.5 million in professional fees primarily relating to pre-commercial planning costs for momelotinib. General and administrative expenses included non-cash stock-based compensation of $5.2 million and $1.8 million for the year ended December 31, 2020 and 2019, respectively.
Total other income (expense), net was $15.8 million of other expense, net for the year ended December 31, 2020, compared to $21.4 million of other expense, net for the year ended December 31, 2019. The difference was primarily attributable to a non-cash charge of $20.9 million recognized during the year ended December 31, 2019, related to the change in fair value of warrant liabilities and $1.3 million of offering expenses pertaining to the issuance of the warrants in the 2019 public offering, offset by a non-cash charge of $16.2 million recognized during the year ended December 31, 2020, related to the change in fair value of warrant liabilities which were reclassified to equity in January 2020.
For the year ended December 31, 2020, Sierra incurred a Generally Accepted Accounting Principles (GAAP) net loss of $80.9 million compared to a GAAP net loss of $88.3 million for the year ended December 31, 2019. The GAAP net loss includes a non-cash charge of $16.2 million and $20.9 million, related to the change in fair value of warrant liabilities, for the year ended December 31, 2020 and December 31, 2019, respectively, and a non-cash charge of $1.5 million and $10.5 million pertaining to the obligation to issue securities to Gilead for the year ended December 31, 2020 and 2019, respectively.
Non-GAAP adjusted net loss was $53.7 million for the year ended December 31, 2020, compared with a non-GAAP adjusted net loss of $51.2 million for the year ended December 31, 2019. Non-GAAP adjusted net loss excludes expenses related to the change in fair value of warrant liabilities, the securities issuance obligation, and stock-based compensation. See "Non-GAAP Financial Measures" and "Reconciliation of GAAP to Non-GAAP Financial Measures" below for a reconciliation of this GAAP and non-GAAP financial measure.
Cash and cash equivalents totaled $104.1 million as of December 31, 2020, compared to $147.5 million as of December 31, 2019.
As of December 31, 2020, there were 11,128,484 total shares of common stock outstanding and warrants to purchase 11,102,251 shares of common stock, with an exercise price equal to $13.20 per share. There were 4,146,928 shares issuable upon exercise of stock options and an additional warrant to purchase 1,839 shares.