On May 8, 2025 Sutro Biopharma, Inc. (Sutro or the Company) (NASDAQ: STRO), an oncology company pioneering site-specific and novel-format antibody drug conjugates (ADCs), reported its financial results for the first quarter of 2025 and recent business highlights (Press release, Sutro Biopharma, MAY 8, 2025, View Source [SID1234652763]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"In the first quarter, we announced a strategic decision to shift Sutro’s product candidate focus from luvelta to our pipeline of wholly-owned novel exatecan and dual-payload ADCs. As part of this review, we selected STRO-004—a next-generation Tissue Factor-targeting exatecan/Topo 1 ADC—as our lead clinical candidate, supported by strong preclinical data that point to its best-in-class potential," said Jane Chung, Sutro’s Chief Executive Officer. "At AACR (Free AACR Whitepaper), we presented on STRO-004’s potent, dose-dependent anti-tumor activity and favorable safety profile across multiple dose levels and highlighted the unique capabilities of our XpressCF+ cell-free platform to develop novel dual-payload ADCs—an approach that holds significant promise for some of the most difficult-to-treat cancers. Additionally, next week, we have the opportunity to present preclinical data on STRO-006 for the first time, demonstrating encouraging pharmacokinetics (PK) and anti-tumor activity."

Ms. Chung continued: "We currently are on track to deliver three new INDs over the next three years, starting with STRO-004, which is expected to enter clinical studies in the second half of this year. Our rich pipeline, made possible by our optimized cell-free platform, is designed to engage complex, hard-to-drug targets with next-generation single- and dual-payloads. We are also already seeing the extraordinary capabilities of our platform yield important advances in our collaboration with Astellas, with the recent initiation of an IND-enabling toxicology study for the first dual-payload immunostimulatory ADC program under our collaboration, triggering a milestone payment to Sutro. Our team remains inspired by the immense potential of our platform and pipeline, and the substantial benefit it can bring to patients and to our partners."

Corporate and Program Updates

•
In March, Sutro announced completion of a strategic portfolio review resulting in the prioritization of its wholly-owned next-generation ADC programs. While Sutro will not continue the development of luveltamab tazevibulin (luvelta) on its own, it remains open to partnership opportunities.

Wholly-Owned Pipeline

•
STRO-004: Sutro’s novel exatecan Tissue Factor ADC has been prioritized as the Company’s lead program, with an initial focus on solid tumors. The Company is preparing to submit an IND and initiate a first-in-human study in the second half of 2025.
•
STRO-006: Sutro’s differentiated integrin beta-6 (ITGB6) ADC is expected to enter clinical development in 2026, aimed at multiple solid tumors.
•
Dual-Payload Program: An IND for Sutro’s first wholly-owned dual-payload ADC is anticipated to be filed in 2027.

Existing Collaborations for Next-Generation ADCs

•
Ipsen: A drug development program is ongoing with Ipsen for STRO-003, a ROR1 ADC.
•
Astellas: Two research and development programs are ongoing with Astellas for dual-payload immunostimulatory ADCs (iADCs), one of which has initiated an IND-enabling toxicology study triggering a milestone payment to Sutro.

These collaborations remain a strategic priority given their long-term value creation potential and the increasing relevance of specialized ADCs in the treatment of cancer.

Medical Conferences

•
21st Annual PEGS Boston: The Essential Proteins Engineering & Cell Therapy Summit: In May, Sutro will present promising preclinical data with STRO-006, highlighting its superior anti-tumor activity compared to first generation ITGB6 ADCs at clinically relevant dose levels, as well as its favorable PK and tolerability profile.
•
2025 American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting: In April, Sutro presented encouraging preclinical results with STRO-004 and its dual-payload ADC programs. Among the highlights, a single dose of STRO-004 led to promising overall response and disease control rates in Tissue Factor-positive patient-derived xenograft models spanning multiple cancer types. Additionally, STRO-004 has a favorable safety profile in cynomolgus monkeys up to 50 mg/kg, the highest dose tested.
•
Society of Gynecologic Oncology (SGO) Annual Meeting on Women’s Cancer: In March, expanded data were presented in a late-breaking oral presentation from the dose-optimization portion of the REFRαME-O1 trial with luvelta in patients with platinum resistant ovarian cancer. In the study, luvelta demonstrated encouraging antitumor activity in patients with late-stage ovarian cancer across all levels of Folate Receptor-α expression of 25% or greater, including an improved overall response rate, a low discontinuation rate, and a consistent safety profile across dose levels.

Upcoming Investor Conferences

Management will participate in the following upcoming healthcare investor conferences. Webcasts of the presentations will be accessible through the News & Events page of the Investor Relations section of the Company’s website at www.sutrobio.com. Archived replays will be available for at least 30 days after the event.

•
TD Cowen’s 6th Annual Oncology Innovation Summit, May 27-28, 2025, Virtual
•
Jefferies 2025 Global Healthcare Conference, June 3-5, 2025, in New York

Organization

•
As part of the restructuring, Jane Chung, President and Chief Operating Officer, assumed the responsibilities as Chief Executive Officer and was appointed as a member of the Sutro Board. The Company is also reducing its organizational headcount by nearly 50 percent and decommissioning its manufacturing facility by year-end 2025. Manufacturing capabilities to support the next-generation ADC pipeline have been fully established and scaled up externally.

First Quarter 2025 Financial Highlights

Cash, Cash Equivalents and Marketable Securities

As of March 31, 2025, Sutro had cash, cash equivalents and marketable securities of $249.0 million, as compared to $316.9 million as of December 31, 2024. Cost reductions subsequently realized from the restructuring, combined with refocused clinical development priorities give the Company an expected cash runway into early 2027, excluding additional anticipated milestones from existing collaborations.

Revenue

Revenue was $17.4 million for the quarter ended March 31, 2025, as compared to $13.0 million for the quarter ended March 31, 2024, with the 2025 amount related principally to the Astellas collaboration. Future collaboration and license revenue under existing agreements, and from any additional collaboration and license partners, will fluctuate as a result of the amount and timing of revenue recognition of upfront, milestones, and other agreement payments.

Research & Development (R&D) and General & Administrative (G&A) Expenses

Total R&D and G&A expenses for the quarter ended March 31, 2025 were $64.9 million, as compared to $69.6 million for the quarter ended March 31, 2024. The 2025 period includes non-cash expenses for stock-based compensation of $5.5 million and depreciation and amortization of $1.9 million, as compared to $6.1 million and $1.8 million, respectively, in the 2024 period. For the quarter ended March 31, 2025, R&D expenses were $51.6 million and G&A expenses were $13.3 million.

Restructuring and Related Costs

Restructuring and related costs for the quarter ended March 31, 2025 were $21.0 million. Sutro will continue to recognize restructuring and related costs in future periods for the deprioritization of the luvelta program, of which it expects to recognize a significant portion in 2025. The ultimate amount of expense will be affected by the timing to complete Sutro’s cost commitments to its third-party CROs and CMOs and the full wind-down of the clinical trials. Sutro will revise its estimates of the costs to deprioritize these studies for the luvelta program and the amount of severance and benefits paid to employees as new information becomes available to the Company in future periods.