On May 9, 2023 Precision BioSciences, Inc. (Nasdaq: DTIL), a clinical stage gene editing company developing ARCUS-based ex vivo allogeneic CAR T and in vivo gene editing therapies, reported financial results for the first quarter ended March 31, 2023 and provided a business update (Press release, Precision Biosciences, MAY 9, 2023, View Source [SID1234631289]).

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"Our progress in the first quarter of 2023 makes it clear that we are focused on the generation of meaningful clinical data from our CAR T programs while working in parallel to advance our broad in vivo portfolio into the clinic as soon as possible," said Michael Amoroso, Chief Executive Officer at Precision BioSciences. "We continue to collect data from our latest patient cohorts for both our azer-cel and PBCAR19B programs and anticipate providing an update once we have sufficient follow up from these cohorts. We expect that these data will inform key next steps for development and potential regulatory interactions."

"From our in vivo portfolio, we continue to leverage the core features of ARCUS that we believe drive high efficiency gene insertion and the ability to make large gene excisions while advancing programs where we see a clear and rapid path to the clinic. Preclinical data presentations at the Global Hepatitis Summit 2023 on hepatitis B virus (HBV) and an upcoming, late breaker oral presentation on Duchenne muscular dystrophy (DMD) at the American Society of Gene & Cell Therapy Meeting highlight key execution steps that have brought ARCUS closer to the clinic. We look forward to providing further updates across our wholly owned and partnered gene editing programs at our upcoming in vivo gene editing R&D Day in the middle of the year," added Mr. Amoroso.

Ex Vivo Allogeneic CAR T Portfolio:

Azer-cel: Precision continues to progress its Phase 1/2a clinical trial of azer-cel, the Company’s lead investigational anti-CD19 allogeneic CAR T candidate, in adult subjects with non-Hodgkin lymphoma (NHL) who have relapsed following CAR T treatment. Precision plans to provide an update on the expansion cohort as well as additional long-term follow up from the previously presented azer-cel cohorts in May 2023. As of May 1, 2023, seven patients have been treated in the expansion/Phase 2a cohort with a lower dose lymphodepletion regimen, in addition to the 12 patients who were treated in previous cohorts.

PBCAR19B: Precision continues to progress the ongoing Phase 1 study of PBCAR19B, its second generation, anti-CD19 targeting allogeneic CAR T candidate designed to evade immune rejection by host T cell and natural killer (NK) cells with a single-gene edit to knock-down beta-2 microglobulin and insert an HLA-E transgene. The Company also expects to provide a program update on seven patients treated at Dose Level 2 in May 2023.

In Vivo Gene Editing Portfolio:

Chronic Hepatitis B Virus (HBV): Precision is prioritizing nomination of a development candidate for its wholly owned PBGENE-HBV in vivo program, with the goal of submitting a Clinical Trial Application (CTA) and/or Investigational New Drug Application (IND) in 2024. An abstract titled "Targeting Hepatitis B cccDNA with a Sequence-Specific ARCUS Nuclease to Eliminate Hepatitis B Virus In Vivo" was presented in April 2023 at the Global Hepatitis Summit 2023. Data showed that ARCUS demonstrated a high degree of on-target antiviral activity, as measured by substantial reductions of both intracellular cccDNA and secretion of HBsAg, with no detectable translocations in ARCUS-treated primary human hepatocytes. These data support the further development of PBGENE-HBV with the goal of developing a functional cure for HBV. The Company plans to present additional data in 2023.

Novartis Partnered Program: Precision continues to advance its gene editing program with Novartis to develop a custom ARCUS nuclease for patients with sickle cell disease and beta thalassemia. The collaborative intent is to insert, in vivo, a therapeutic anti-sickling gene as a potential one-time transformative treatment administered directly to the patient that would overcome many of the hurdles present today with other therapeutic technologies, including those targeting an ex vivo gene editing approach.

Prevail, a wholly-owned subsidiary of Lilly, Partnered Programs: Precision continues its in vivo gene editing collaboration with Prevail Therapeutics, a wholly-owned subsidiary of Eli Lilly and Company (Lilly), in applying ARCUS nucleases to three initial targets, including DMD in muscle, a central nervous system directed target, and a liver directed target. The goal of the PBGENE-DMD program is to utilize a pair of ARCUS nucleases, delivered by a single AAV, that are designed to excise an approximately 500,000 base pair mutation "hot spot" region from the dystrophin gene to generate a variant of the dystrophin protein that is functionally competent.

In April 2023, Precision announced that a late-breaking abstract featuring preclinical data from its PBGENE-DMD program for the potential treatment of DMD was selected for an oral presentation at the American Society of Gene & Cell Therapy (ASGCT) (Free ASGCT Whitepaper) 26th Annual Meeting being held May 16-20, 2023 in Los Angeles, CA.

Ornithine Transcarbamylase (OTC) Deficiency: Led by iECURE, an ARCUS-mediated gene insertion approach is being pursued as a potential treatment for neonatal onset ornithine transcarbamylase (OTC) deficiency. Non-human primate (NHP) data presented by researchers from the University of Pennsylvania’s Gene Therapy Program demonstrated sustained gene insertion of a therapeutic OTC transgene one-year post-dosing in newborn and infant NHP with high efficiency. iECURE is targeting to submit a CTA and/or IND in the second half of 2023.

Other ARCUS Research: Preclinical data presented at the Keystone Symposium in March 2023 demonstrated the unique potential of ARCUS nucleases to achieve high frequency gene insertion in nondividing primary hepatocytes. These data highlight the potential advantage of ARCUS for use in developing therapeutics for gene addition, for which Precision believes ARCUS is highly differentiated given the need for extremely low levels of off-target editing and high insertion efficiency.

Corporate:

Intellectual Property (IP) Update: In February 2023, the U.S. Patent and Trademark Office issued Precision a Notice of Allowance for an application with composition of matter claims covering a PCSK9-specific ARCUS nuclease. This ARCUS nuclease has been used preclinically for both gene deletion approaches for cardiovascular diseases such as familial hypercholesterolemia as well as a viable and safe site to insert a functional copy of a specific gene to restore function addressing other diseases requiring gene addition. This patent further builds on the Company’s IP portfolio that cover the ARCUS platform and its use developing novel ex vivo and in vivo gene editing therapies.

Quarter Ended March 31, 2023 Financial Results:

Cash and Cash Equivalents: As of March 31, 2023, Precision had approximately $158 million in cash and cash equivalents. In line with the same period for 2022, net cash used in operating activities for the quarter ended March 31, 2023 are expected to be higher in the first fiscal quarter than the remainder of 2023 primarily due to the timing of the Company’s annual compensation cycle. The Company expects that existing cash and cash equivalents, expected operational receipts, and available credit will be sufficient to fund its operating expenses and capital expenditure requirements through the first quarter of 2025.

Revenues: Total revenues for the quarter ended March 31, 2023 were $8.8 million, as compared to $3.3 million for the same period in 2022. The increase of $5.5 million in revenue during the quarter ended March 31, 2023 was primarily driven by revenue recognized under the Novartis agreement as work thereunder began in the third quarter of 2022.

Research and Development Expenses: Research and development expenses were $22.2 million for the quarter ended March 31, 2023, as compared to $20.0 million for the same period in 2022. The increase of $2.2 million was primarily due to an increase in direct research and development expenses related to our azer-cel and PBCAR19B product candidates as well as consulting fees related to our increased focus on quality management, partially offset by a decrease in expenses related to manufacture of materials for use in preclinical studies, PBCAR20A external development costs, and share-based compensation expense from recent forfeitures.

General and Administrative Expenses: General and administrative expenses were $11.1 million for the quarter ended March 31, 2023, as compared to $10.7 million for the same period in 2022. The increase of $0.4 million was primarily related to consulting fees related to in vivo program competitive landscape analyses, partially offset by a decrease in insurance expense.

Net Loss: Net loss was $25.1 million, or $(0.23) per share (basic and diluted), for the quarter ended March 31, 2023, as compared to a net loss of $28.2 million, or $(0.46) per share (basic and diluted), for the same period in 2022. Weighted average shares of common stock outstanding were approximately 111.3 million for the quarter ended March 31, 2023, as compared to approximately 61.0 million for the quarter ended March 31, 2022. The increase in weighted average shares of common stock outstanding was primarily due to a $50 million underwritten offering of common stock and Novartis’ $25 million equity investment in 2022.