On November 13, 2018 Rubius Therapeutics, Inc. (Nasdaq: RUBY), a biotechnology company developing an entirely new class of allogeneic cellular therapies, reported third quarter 2018 financial results and operational progress (Press release, Rubius Therapeutics, NOV 13, 2018, View Source [SID1234531334]).
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"During the third quarter, we remained focused on advancing our first program, RTX-134, for the treatment of phenylketonuria. We are on track to file an Investigational New Drug application during the first quarter of 2019," said Pablo J. Cagnoni, M.D., chief executive officer of Rubius Therapeutics. "We are also continuing to advance our earlier pipeline, which we believe holds broad therapeutic potential across cancer, autoimmune disease and additional enzyme deficiencies. In order to successfully bring our medicines to patients, we are ensuring that we will have state-of-the-art manufacturing capabilities in place, as shown through the purchase, in July, of our 135,000-square foot manufacturing facility in Smithfield, RI."
Third quarter highlights include:
· On track to submit first IND for lead program, RTX-134, during the first quarter of 2019, and an additional three to four INDs during 2019 and 2020
· Closed initial public offering (IPO) in July 2018, raising $254.3 million in net proceeds
· Acquired and initiated renovations on manufacturing facility in Smithfield, RI; facility is expected to be operational by the end of 2020
· Continued to generate promising preclinical data in support of additional pipeline programs; data expected to be published during 2019
· Strengthened internal capabilities in discovery, platform development and manufacturing and grew the organization to 110 employees to predominantly support research and development (R&D) activities
Third Quarter Financial Results
Net loss for the third quarter of 2018 was $26.4 million or $0.42 per common share, compared to $11.9 million or $1.48 per common share in the third quarter of 2017.
In the third quarter of 2018, Rubius invested $14.4 million in R&D related to its novel RED PLATFORM and towards expanding and advancing its product pipeline, compared to $6.1 million in the third quarter of 2017. The year-over-year increase was due to an additional $2.9 million of costs incurred in preparation for the Phase 1/2a clinical trial for RTX-134, and $3.6 million was associated with personnel costs and stock-based compensation driven by increases in R&D headcount to support Rubius’ goal of delivering four to five IND’s during 2019 and 2020.
G&A expenses were $13.2 million during the third quarter of 2018, as compared to $5.8 million for the third quarter of 2017. The higher costs were primarily driven by a $4.6 million increase in stock-based compensation and a $1.9 million increase in personnel costs and professional fees to support the Company’s growth and to operate as a public company.
Nine Month Financial Results
Net loss for the first nine months of 2018 was $62.0 million or $2.33 per common share, compared to $27.0 million or $3.42 per common share in the first nine months of 2017.
In the nine months ended September 30, 2018, Rubius invested $35.2 million in R&D related to its novel RED PLATFORM and towards expanding and advancing its product pipeline, compared to $14.6 million in the first nine months of 2017. The year-over-year increase was due to an increase of $5.8 million of costs incurred in preparation for the Phase 1/2a clinical trial for RTX-134, and $6.6 million in personnel costs and stock-based compensation driven by increases in R&D headcount to support Rubius’ goal of delivering four to five IND’s during 2019 and 2020.
G&A expenses were $27.3 million during the first nine months of 2018, as compared to $11.2 million for the same period in 2017. The higher costs were primarily driven by a $8.7 million increase in stock-based compensation and a $6.0 million increase in personnel costs and professional fees to support the Company’s growth and to operate as a public company.
During the third quarter of 2018, the Company adopted new guidance for the accounting for stock-based payments to nonemployees, effective as of January 1, 2018. As a result of this adoption, previously reported amounts for the six months ended June 30, 2018 for R&D expenses and G&A expenses were reduced by $0.7 million and $8.0 million, respectively.
Cash Position
As of September 30, 2018, cash, cash equivalents and investments grew significantly to $408.9 million as compared to $104.3 million as of December 31, 2017, providing Rubius with a cash runway into 2021. The increase in cash reflects $254.3 million of net proceeds from the company’s IPO during the third quarter of 2018 and $101.0 million of net proceeds received from its Series C preferred stock financing during the first quarter of 2018. The proceeds received from the financings were offset by $38.6 million used in operations during the nine-month period and $11.7 million of capital purchases, including $8.0 million to acquire the manufacturing facility in Smithfield, Rhode Island.
About Phenylketonuria and RTX-134
Phenylketonuria (PKU) is an inherited, rare enzymatic disorder characterized by the body’s inability to effectively metabolize the amino acid phenylalanine. The accumulation of phenylalanine in the blood causes damage to the central nervous system and a range of symptoms, including intellectual disability, delayed development and impaired cognitive function. RTX-134 is an allogeneic cellular therapy for the treatment of PKU, which expresses the enzyme phenylalanine ammonia lyase (PAL) inside the cell. In preclinical studies, phenylalanine was shown to diffuse into RTX-134, where PAL converted phenylalanine into ammonia and trans-cinnamic acid, metabolites that are cleared by the body. Compared to current therapeutic interventions, RCT product candidates may have a longer and more sustained treatment duration given the 120-day half-life of red blood cells and may avoid immune-driven adverse events and reduction in efficacy, which result from antibody formation.