On March 16, 2022 Sana Biotechnology, Inc. (NASDAQ: SANA), a company focused on creating and delivering engineered cells as medicines, reported financial results and business highlights for the fourth quarter and year ended December 31, 2021 (Press release, Sana Biotechnology, MAR 16, 2022, View Source [SID1234610174]).

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"We are pleased with the progress we are making in our pipeline and in building capabilities to execute our vision of exploiting the potential of engineered cells to treat a number of diseases that don’t have effective treatments today," said Steve Harr, Sana’s President and Chief Executive Officer. "In 2021, we meaningfully strengthened our balance sheet, advanced our pipeline giving us the potential for two investigational new drug applications (INDs) in 2022 and multiple INDs per year going forward, built out our supply chain, including commercial access to gene-editing reagents and pluripotent stem cells, and commenced the build-out of our own manufacturing facility. Most importantly, we successfully attracted talent in key business areas, which, combined with the people already inside of the company, give us the capabilities, insights, focus, and dedication to reach our mission for patients."

Recent Corporate Highlights

Demonstrating forward progress in moving toward clinical trials for Sana’s multiple platforms including Sana’s ex vivo hypoimmune allogeneic CAR T, in vivo fusogen CAR T, and stem cell-derived programs:

Continued progress in building Sana’s hypoimmune ex vivo platform
Presented data in non-human primates showing survival and immune evasion, without immune suppression, of transplanted stem cells with Sana’s hypoimmune gene modifications.
Entered into a non-exclusive license and development agreement with FUJIFILM Cellular Dynamics, Inc. (FCDI) for access to FCDI induced pluripotent stem cells (iPSCs).
Gained access to gene editing capability to enable programs within Sana’s allogeneic CAR T and pluripotent stem cell portfolio through non-exclusive license for commercial rights to Beam Therapeutics Inc.’s (Beam) CRISPR Cas12b.
Progressed Sana’s hypoimmune allogeneic CD19-targeted CAR T program, SC291; IND expected as early as this year
Continue to progress on key steps required to advance to clinical trials, including contract manufacturing agreement for Phase I clinical supply, gene-editing reagent access through Beam license, Good Laboratory Practices (GLP) toxicology studies, and Good Manufacturing Practices (GMP) manufacturing processes and scale-up.
Presented data showing that hypoimmune CAR T cells evade both innate and adaptive immune systems in murine models, even in animals with pre-existing immunity to CAR T cells.
Presented data showing that CD19-targeted hypoimmune CAR T cells effectively kill tumor cells in mice and functionally evade the innate and adaptive immune system in allogeneic mouse recipients with either a murine or humanized immune system.
Progressed Sana’s in vivo CAR T program, SG295, utilizing a CD8-targeted fusosome to deliver a CD19-targeted CAR; IND expected as early as this year
Continue to progress on key steps to advance to clinical trials, including contract manufacturing agreement for Phase I clinical supply, GLP toxicology studies, and GMP manufacturing processes and scale-up.
Presented data highlighting ability of a single intravenous administration of a CD8-targeted fusosome containing a CD20-targeted CAR to deplete CD20+ B cells in NHPs.
Presented data highlighting ability of a single intravenous administration of SG295 to eliminate CD19+ tumor cells in mouse tumor models.
Expanded Sana’s CAR T capability to potentially develop best-in-class, broadly accessible CAR T cell therapies
Entered into an exclusive agreement with the National Institutes of Health (NIH) for worldwide commercial rights to the NIH’s CD22 chimeric antigen receptor with a fully-human binder. This CAR construct has shown efficacy in several clinical studies, including in CD19 CAR T cell therapy failures. Targeting both CD19 and CD22 with an "off-the-shelf" product, whether in combination with Sana’s hypoimmune platform or fusogen platform, offers the potential of higher and more durable complete response rates in earlier-stage patients as well as in patients that have previously failed an autologous CD19 CAR T cell therapy.
Entered into a non-exclusive agreement with IASO Biotherapeutics and Innovent Biologics for commercial rights to a clinically validated fully-human B cell maturation antigen (BCMA) CAR construct, which Sana intends to incorporate into both the company’s ex vivo hypoimmune allogeneic and in vivo fusogen platforms for the treatment of multiple myeloma.
Progressed Sana’s stem cell-derived pancreatic beta cell program, SC451, with potential to treat type 1 diabetes
Presented pre-clinical murine data demonstrating the ability to make stem cell-derived hypoimmune pancreatic islet cells with robust function and hypoimmune pancreatic islet cells that evade immune detection and have the ability to regulate glucose levels.
Established necessary agreements to establish GMP grade cell lines, including FCDI and Beam licenses, and secured contract manufacturing partner for cell bank production.
Remain on track for an IND as early as 2023.
Progressed Sana’s stem cell-derived cardiomyocyte program with the goal of treating heart failure
Presented data that demonstrated four edits in ion channels that alter the electrical properties of pluripotent stem cell-derived cardiomyocytes such that they eliminate engraftment arrythmias in a pig transplant model. These results demonstrate important progress in addressing a key risk associated with transplanting cardiomyocytes into the heart.
Strengthened balance sheet and Board leadership; signed lease to add internal manufacturing capability

Strengthened balance sheet with net proceeds of $626.6 million from the sale of 27 million shares of common stock in the company’s initial public offering.
Expanded Board of Directors with the addition of Joshua Bilenker, M.D., CEO of Treeline Biosciences, Alise Reicin, M.D., CEO of Tectonic Therapeutic, and Michelle Seitz, CFA, Chairman and CEO of Russell Investments.
Announced a lease agreement to develop a manufacturing facility in Fremont, California to support the manufacture of late-stage clinical development and early commercial product candidates across the multiple technologies in the pipeline.
Fourth Quarter 2021 Financial Results

GAAP Results

Cash Position: Cash, cash equivalents, and marketable securities as of December 31, 2021 were $746.9 million compared to $412.0 million as of December 31, 2020, an increase of $334.9 million. The increase was primarily driven by net proceeds of $626.4 million received in Sana’s initial public offering in February 2021, partially offset by cash used in operations of $201.1 million, a one-time upfront cash payment to Beam of $50.0 million to license its genome editing technology, and cash used for the purchase of property and equipment of $29.9 million.

Research and Development Expenses: For the three and twelve months ended December 31, 2021, research and development expenses, inclusive of non-cash expenses, was $108.5 million and $248.6 million, respectively, compared to $36.5 million and $132.9 million, respectively, for the same periods in 2020. The increases of $72.0 million and $115.7 million, respectively, for the three and twelve months ended December 31, 2021 were due to the one-time upfront payment to Beam to license its genome editing technology, an increase in personnel expenses related to increased headcount to expand Sana’s research and development capabilities, costs for laboratory supplies, costs for preclinical studies and external manufacturing, and facility costs. Research and development expenses include non-cash stock-based compensation of $5.3 million and $15.2 million, respectively, for the three and twelve months ended December 31, 2021 and $2.3 million and $4.9 million, respectively, for the same periods in 2020.

Research and Development Related Success Payments and Contingent Consideration: For the three months ended December 31, 2021, we recognized a non-cash gain of $9.9 million, and for the twelve months ended December 31, 2021, we recognized non-cash expense of $57.9 million, in connection with the change in the estimated fair value of the success payment liabilities and contingent consideration in aggregate, compared to expenses of $67.6 million and $124.9 million, respectively, for the same periods in 2020.

General and Administrative Expenses: General and administrative expenses for the three and twelve months ended December 31, 2021, inclusive of non-cash expenses, were $12.7 million and $50.4 million, respectively, compared to $9.2 million and $28.3 million, respectively, for the same periods in 2020. The increases of $3.5 million and $22.1 million, respectively, in the three and twelve months ended December 31, 2021 were primarily due to increased personnel-related expenses attributable to an increase in headcount to build our infrastructure and support our continued research and development activities, legal fees to support our patent portfolio and license arrangements, insurance associated with being a public company, consulting fees, and facility costs. General and administrative expenses include stock-based compensation of $2.0 million and $7.1 million, respectively, for the three and twelve months ended December 31, 2021 and $0.4 million and $0.9 million, respectively, for the same periods in 2020.

Net Loss: Net loss for the three and twelve months ended December 31, 2021 were $110.7 million, or $0.60 per share, and $355.9 million, or $2.14 per share, respectively, compared to $113.2 million, or $7.40 per share, and $285.3 million, or $21.92 per share, respectively, for the same periods in 2020.
Non-GAAP Measures

Non-GAAP Operating Cash Burn: Non-GAAP operating cash burn for the twelve months ended December 31, 2021 was $209.6 million compared to $125.0 million for the same period in 2020. Non-GAAP operating cash burn is the decrease in cash, cash equivalents, and marketable securities, excluding cash inflows from financing activities, cash outflows from business development activities, and the purchase of property and equipment.

Non-GAAP Research and Development Expenses: Non-GAAP research and development expenses for the three and twelve months ended December 31, 2021 were $108.5 million and $248.6 million, respectively, compared to $36.5 million and $123.0 million, respectively, for the same periods in 2020. Non-GAAP research and development expenses excludes certain one-time costs to acquire technology.

Non-GAAP Net Loss: Non-GAAP net loss for the three and twelve months ended December 31, 2021 was $120.6 million, or $0.65 per share, and $298.1 million, or $1.79 per share, respectively, compared to $45.5 million, or $2.98 per share, and $150.4 million, or $11.56 per share, respectively, for the same periods in 2020. Non-GAAP net loss excludes certain one-time costs to acquire technology and non-cash expenses related to the change in the estimated fair value of contingent consideration and success payment liabilities.
A discussion of non-GAAP measures, including a reconciliation of GAAP and non-GAAP measures, is presented below under "Non-GAAP Financial Measures."