On February 29, 2024 Shattuck Labs, Inc. (Shattuck) (NASDAQ: STTK), a clinical-stage biotechnology company pioneering the development of bi-functional fusion proteins as a new class of biologic medicine for the treatment of patients with cancer and autoimmune disease, reported financial results for the fourth quarter and full year ended December 31, 2023 and provided recent business highlights (Press release, Shattuck Labs, FEB 29, 2024, View Source [SID1234640666]).

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"Over the course of 2023, the SL-172154 program rapidly transitioned from Phase 1A dose-escalation studies to Phase 1B dose expansion studies in PROC, HR-MDS, and TP53m AML, which enabled us to share initial efficacy data in the fourth quarter," said Taylor Schreiber, M.D., Ph.D., Chief Executive Officer of Shattuck. "We have now begun 2024 with the momentum and financial resources to expand our HR-MDS and TP53m AML studies and capitalize on the potential first-in-class opportunity that now exists in those indications. We have expanded our ongoing trials, and look forward to defining our registrational strategy following the next clinical updates expected mid-year in HR-MDS, AML, and PROC. While we will remain focused on advancing SL-172154, our pre-clinical pipeline has continued to mature, as evidenced by our recent collaboration with Ono, and publications in both Cancer Cell and Cancer Research. We look forward to providing additional updates across the portfolio over the course of 2024."

Clinical Milestones Expected in 2024
SL-172154 (SIRPα-Fc-CD40L)
•Objective response rates and duration of response based on the then-available data from the Phase 1B expansion cohorts of SL-172154 in combination with AZA in frontline HR-MDS and frontline TP53m AML expected mid-year 2024.
•Objective response rate and duration of response based on the then-available data from the Phase 1B clinical trial of SL-172154 in combination with PLD in PROC expected mid-year 2024.
•Initial combination data from the Phase 1B clinical trial of SL-172154 in combination with mirvetuximab soravtansine in PROC expected mid-year 2024.

Fourth Quarter 2023 Business Highlights and Other Recent Developments
ARC Clinical-Stage Pipeline
SL-172154 (SIRPα-Fc-CD40L)
•Completed Initial Enrollment and Expanded the Phase 1B Portion of the Ongoing Phase 1A/B Clinical Trial of SL-172154 in Frontline HR-MDS and Frontline TP53m AML Patients: This trial is evaluating the safety, tolerability, pharmacokinetics, anti-tumor activity, and pharmacodynamic effects of SL-172154 in combination with AZA in both frontline HR-MDS patients and frontline TP53m AML patients. The data from the dose-escalation portion of the clinical trial in primarily relapsed/refractory patients was presented at the 65th ASH (Free ASH Whitepaper) Annual Meeting. Initial data from the dose-expansion portion of the trial in frontline patients suggest that SL-172154 improved complete response rates relative to what would be expected historically with AZA alone in previously untreated HR-MDS (predominantly TP53m HR-MDS population) and TP53m AML. SL-172154 demonstrated an acceptable safety and tolerability profile both as monotherapy and in combination with AZA. No destructive anemia was observed. Objective response rates and duration of response based on the then-available data from the Phase 1B expansion cohorts of SL-172154 in combination with AZA in frontline HR-MDS and TP53m AML are expected mid-year 2024.
•Completed Enrollment of Ongoing Phase 1B Clinical Trial of SL-172154 in Combination with PLD in PROC Patients and Presented Positive Interim Data: This trial is evaluating the safety, tolerability, pharmacokinetics, anti-tumor activity, and pharmacodynamic effects of SL-172154 (using the selected dose of 3.0 mg/kg), in combination with PLD in patients with PROC. The initial data from this Phase 1B clinical trial in PROC patients was presented in November 2023. Initial data suggest that SL-172154 improved the response rate relative to what would be expected from PLD alone. The initial data suggest SL-172154 had an acceptable safety profile in combination with PLD. Objective response rate and duration of response based on the then-available data from the Phase 1B clinical trial of SL-172154 in combination with PLD in PROC are expected mid-year 2024.
•Continued Dosing in Phase 1B Clinical Trial of SL-172154 in Combination with Mirvetuximab Soravtansine in PROC Patients. This trial is evaluating the safety, pharmacokinetics, pharmacodynamic effects, and preliminary anti-tumor activity of SL-172154 administered in combination with mirvetuximab soravtansine in patients with PROC. Mirvetuximab soravtansine is an antibody-drug conjugate targeting folate receptor alpha (FRα), which provides for both direct tumor cell killing as well as enhanced macrophage phagocytosis through binding with Fc gamma receptors and has received accelerated approval in the United States for PROC patients whose tumors are shown to be FRα positive, defined as ≥75%, as determined by the VENTANA FOLR1 (FOLR1-2.1) Assay. Initial combination data from the Phase 1B clinical trial of SL-172154 in combination with mirvetuximab soravtansine in PROC is expected mid-year 2024.
Preclinical
•Published Acquired Resistance (AR) Model in Cancer Cell: In a recent publication in the journal Cancer Cell, the preclinical development of a mouse anti-PD1 AR model by Shattuck was shown to closely mimic the clinical and molecular signatures of those in human patients with non-small cell lung cancer (NSCLC), who have developed AR to anti-PD(L)1 therapies, including a dysregulated interferon response. Findings such as these are important to guide the identification of new targets and development of new treatment strategies for this growing unmet need.
•Published Preclinical mRNA Work in Cancer Research: In a recent study published in Cancer Research, scientists at Shattuck and Moderna demonstrated the feasibility of delivering certain hexameric, dual-sided fusion proteins as lipid-encapsulated mRNA. The expression level, duration of exposure, and efficacy in a murine anti-tumor model achieved by the mRNA delivery outperformed that of the corresponding intravenous administration of recombinant fusion proteins. These results demonstrated feasibility for delivery of complex fusion proteins generally, which may have important pharmacokinetic and pharmacoeconomic benefits for indications outside of oncology.

Upcoming Events
•Shattuck plans to attend the following investor or scientific conferences. Details are included on the Events & Presentations section of the Company’s website.
▪Cowen 44th Annual Health Care Conference (Boston, MA) March 4-6, 2024
▪Leerink Global Biopharma Conference (Miami, FL) March 11-13, 2024
▪Citi’s Biotech C-Suite Fireside Chat Series, held virtually March 20, 2024
▪American Association of Cancer Research Annual Meeting (San Diego, CA) April 5-10, 2024
Corporate Updates
•Shattuck and Ono Enter into Collaboration Agreement: On February 13, 2024, Shattuck announced a strategic collaboration and license agreement with Ono in which Shattuck will lead research and preclinical development of certain compounds selected by Ono from its pipeline of bifunctional fusion proteins to a pair of prespecified targets for potential treatment of autoimmune and inflammatory diseases. Under the terms of the agreement, Shattuck will receive an up-front payment and be eligible for success-based licensing, regulatory, and commercial milestone payments with a total value of up to $227 million, as well as tiered royalties based on global net sales. Shattuck will lead discovery research of certain prespecified compounds.
•Shattuck Closes Financing: On December 21, 2023, Shattuck announced a $50 million public offering of common stock and concurrent private placement of pre-funded warrants. Net proceeds from the public offering and the private placement are intended to further support the development of its pipeline candidates, including SL-172154, as well as general working capital.
Fourth Quarter and Full-Year 2023 Financial Results
•Cash and Cash Equivalents and Investments: As of December 31, 2023 cash and cash equivalents and investments were $130.6 million, as compared to $161.3 million as of December 31, 2022.
•Research and Development (R&D) Expenses: R&D expenses for the quarter ended December 31, 2023,were $15.2 million, as compared to $21.9 million for the quarter ended December 31, 2022. R&D expenses for the year ended December 31, 2023 were $74.3 million, as compared to $82.9 million for the year ended December 31, 2022. This decrease was primarily driven by decreases in the manufacturing of trial materials to support clinical development of our ongoing clinical trials, personnel-related costs, and lab supplies but were offset by an increase in clinical trial cost.
•General and Administrative (G&A) Expenses: G&A expenses for the quarter ended December 31, 2023 were $4.4 million, as compared to $4.8 million for the quarter ended December 31, 2022. General and administrative expenses for the year ended December 31, 2023 were $19.3 million, as compared to $21.1 million for the year ended December 31, 2022. This decrease for the full year was primarily the result of recognizing a litigation settlement of $1.4 million in 2022, and the decrease in the fourth quarter of 2023 was primarily driven by a decrease in insurance and personnel-related cost.
•Net Loss: Net loss was $17.7 million for the quarter ended December 31, 2023, or $0.41 per basic and diluted share, as compared to a net loss of $25.4 million for the quarter ended December 31, 2022, or $0.60 per basic share and diluted share. Net loss for the year ended December 31, 2023 was $87.3 million, or $2.05 per basic and diluted share, as compared to $101.9 million, or $2.41 per basic and diluted share, for the year ended December 31, 2022.
Financial Guidance
Shattuck believes its cash and cash equivalents and investments will be sufficient to fund its operations into 2026, beyond results from its Phase 1 clinical trials of SL-172154. This cash runway guidance is based on the Company’s current operational plans and excludes any additional capital that may be received, proceeds from business development transactions, and/or additional costs associated with clinical development activities that may be undertaken.

About SL-172154
SL-172154 (SIRPα-Fc-CD40L) is an investigational ARC fusion protein designed to simultaneously inhibit the CD47/SIRPα checkpoint interaction and activate the CD40 costimulatory receptor to bolster an anti-tumor immune response in patients with advanced cancer. Multiple Phase 1 clinical trials are ongoing for patients with PROC and patients with AML and HR-MDS.

On February 29, 2024 SELLAS Life Sciences Group, Inc. (NASDAQ: SLS) ("SELLAS" or the "Company"), a late-stage clinical biopharmaceutical company focused on the development of novel therapies for a broad range of cancer indications, reported that the date and time for the presentation of data from the acute myeloid leukemia cohort of patients in the Phase 1 dose-escalation study of SLS009 (formerly GFH009) will be presented in an oral presentation at the 2024 European School of Haematology Acute Leukaemias (ESH) Conference: How to Diagnose and Treat Acute Leukaemias, taking place March 1-3, 2024, in Stockholm, Sweden has changed from Sunday, March 3, 2024 at 12 pm CEST to Friday March 1, 2024 at 12:55 pm CEST (Press release, Sellas Life Sciences, FEB 29, 2024, View Source [SID1234640665]).

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The presentation details are below:

Title: Phase 1 Dose-Escalation Study of GFH009 in Acute Myeloid Leukemia
Session Date and Time: Friday, March 1, 2024, at 12:55 pm CEST
Session Title: Leukemia Treatment Challenges
Presenter: Dr. Tapan Kadia, Professor in the Department of Leukemia at The University of Texas MD Anderson Cancer Center in Houston, Texas
Abstract Number: 6192705

On February 29, 2024 Pfizer Inc. (NYSE: PFE) reported its strategic priorities for the newly formed Oncology organization — and how its deep and diverse pipeline, industry-leading Oncology expertise, and anticipated near- and mid-term catalysts are expected to position the company to deliver strong growth and shareholder value (Press release, Seagen, FEB 29, 2024, View Source [SID1234640664]). A replay of the webcast and related materials, including the presentations and a summary and transcript, will be made available on the Pfizer investor relations website at www.pfizer.com/investors.

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"With the completion of the Seagen acquisition in 2023, Pfizer has significantly expanded its Oncology organization to amplify its efforts to advance new standards of care and improve outcomes for patients," said Chris Boshoff, Chief Oncology Officer and Executive Vice President, Pfizer. "With the energy of our highly talented colleagues, the tremendous potential of our pipeline and scientific engine, and scale of the Pfizer enterprise, we believe we are poised to deliver on our vision of accelerating breakthroughs that help people with cancer globally live better and longer lives."

Boshoff continued, "We have a clear strategy focused on three core scientific modalities and four main types of cancer, where we have the deep expertise and knowledge to advance our leadership. With many significant catalysts expected through the first half of 2025 and beyond, our Oncology organization is well-positioned to be a critical driver of potential long-term sustainable sales and profit growth for Pfizer through the end of the decade."

During the event, Chris Boshoff and members of the Pfizer Oncology leadership team highlighted the company’s expanded capabilities and portfolio following the completion of the acquisition of Seagen in December 2023. Pfizer Oncology is focused on expanding its leadership in four main cancer types: breast cancer, including three main hormonal subtypes; genitourinary cancer, including prostate and urothelial cancers; hematology-oncology, including multiple myeloma and lymphomas, such as Hodgkin’s disease; and thoracic cancers, which includes lung and head and neck cancers.

Pfizer’s Oncology portfolio is focused on three core scientific modalities: small molecules, antibody drug conjugates (ADCs), and bispecific antibodies, including other immuno-oncology biologics. The company is progressing a next-generation ADC platform aimed at novel targets and improved, differentiated payloads, as well as investigational advanced biologics and novel combinations of medicines.

The company outlined potential significant catalysts anticipated through the first half of 2025, including:

Continued focus on four recent priority indication launches, including PADCEV (enfortumab vedotin-ejfv) in combination with pembrolizumab in locally advanced / metastatic urothelial cancer; XTANDI (enzalutamide) in nonmetastatic castration-sensitive prostate cancer (nmCSPC) with biochemical recurrence at high-risk for metastasis; TALZENNA (talazoparib) in combination with XTANDI in metastatic castration-resistant prostate cancer (mCRPC); and ELREXFIO (elranatamab-bcmm) for the treatment of adult patients with relapsed or refractory multiple myeloma who have received at least four prior lines of therapy.
Seven anticipated Phase 3 readouts, including results for vepdegestrant in second-line estrogen receptor positive metastatic breast cancer (ER+ mBC) (VERITAC-2), BRAFTOVI (encorafenib) in first-line BRAF+ metastatic colorectal cancer (BREAKWATER), sasanlimab in non-muscle invasive bladder cancer (CREST), and ELREXFIO in double-class exposed relapsed/refractory multiple myeloma (MagnetisMM-5).
Six anticipated Phase 3 study starts, which includes three new trials recently initiated for key pipeline assets: atirmociclib (CDK4i) in second-line hormone receptor positive (HR+) mBC, sigvotatug vedotin (B6A; integrin beta-6 (IB6)-directed ADC) in second/third-line non-small cell lung cancer (NSCLC), and ELREXFIO in patients with multiple myeloma after their cancer progresses on anti-CD38 treatment (MagnetisMM-32 trial).
Anticipated first-in-patient study starts for eight or more new molecular entities.
During the meeting, Pfizer also shared new or updated clinical data from various pipeline programs, including atirmociclib, ELREXFIO, felmetatug vedotin (B7H4 ADC), mevrometostat (EZH2i), PD-L1 ADC (PF-08046054), and sigvatutag vedotin.

Through its strategy, by 2030, the company anticipates 8 or more potential blockbusters and expects biologics to contribute approximately 65% of Oncology revenues, compared to approximately 6% in 2023.

Prescribing Information for Pfizer Medicines

Please see full Prescribing Information for PADCEV (enfortumab vedotin).

Please see full Prescribing Information for TALZENNA (talazoparib).

Please see full Prescribing Information for XTANDI (enzalutamide).

Please read full Prescribing Information, including BOXED WARNING, for ELREXFIOTM (elranatamab-bcmm).

Please see full Prescribing Information for BRAFTOVI (encorafenib).

On February 29, 2024 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, 2023 (Press release, Sana Biotechnology, FEB 29, 2024, View Source [SID1234640663]).

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"2023 was an important year for the company, setting a strong foundation in three therapeutic areas with significant unmet needs – blood cancers, B-cell mediated autoimmune diseases, and type 1 diabetes. With the ongoing trials in these areas – ARDENT, GLEAM, VIVID, and the primary islet cell investigator-sponsored trial – we expect to treat 40-60 patients across multiple indications in 2024 and report data from each study," said Steve Harr, Sana’s President and Chief Executive Officer. "By year-end 2024, our goal is to demonstrate that we are able to transplant allogeneic cells in patients in multiple settings without immune detection or rejection, delivering potentially transformative therapies across multiple therapeutic areas. With the recent financing, we were able to strengthen the balance sheet, allowing us to continue to invest appropriately in moving our clinical pipeline forward."

Recent Corporate Highlights

Advancing four clinical programs across seven indications, including an allogeneic CAR T program targeting CD19+ cancers, an allogeneic CAR T program for B-cell mediated autoimmune diseases, an allogeneic CAR T program targeting CD22+ cancers, and a primary islet cell therapy in type 1 diabetes:

SC291 is a hypoimmune (HIP)-modified CD19-directed allogeneic CAR T for patients with B-cell malignancies and B-cell mediated autoimmune diseases.

The ARDENT trial evaluates SC291 in patients with B-cell malignancies. Early SC291 data from the ongoing ARDENT trial suggest the ability to dose safely, the desired immune evasion profile, and early clinical efficacy. Enrollment in this dose escalation study continues, and Sana expects to share more data in 2024.
The GLEAM trial evaluates SC291 in patients with B-cell mediated autoimmune diseases including lupus nephritis, extrarenal lupus, and antineutrophil cytoplasmic antibody (ANCA)-associated vasculitis. The Investigational New Drug Application (IND) cleared in 4Q 2023, and Sana expects to share initial data in 2024.
The VIVID trial evaluates SC262, a HIP-modified CD22-directed allogeneic CAR T, in patients with relapsed or refractory B-cell malignancies. The VIVID trial initially investigates SC262 in patients who have received prior CD19-directed CAR T therapy. The IND cleared in early 2024, and Sana expects to share initial data in 2024.
UP421 is a primary human HIP-modified islet cell therapy for patients with type 1 diabetes. The goal of this investigator-sponsored trial is to understand islet cell survival and immune evasion without immunosuppression in patients with autoimmunity, along with function as measured by C-peptide production. The Clinical Trial Application (CTA) cleared in 4Q 2023, and Sana expects initial data to be shared in the first half of 2024.
Published preclinical data in Cell Stem Cell demonstrating that HIP-modified islet cells provided lasting endocrine function in a fully immunocompetent non-human primate, enabling the achievement of exogenous insulin independence without immunosuppression for six-month study duration:

Sana developed HIP-modified allogeneic islet cells, which cluster into effective endocrine organoids termed "pseudo islet grafts" (p-islets). HIP p-islets engrafted and provided stable endocrine function, enabling insulin independence in the absence of immunosuppression.
The allogeneic HIP p-islet graft survived for the six-month duration of the study with no indication of immune recognition of the HIP p-islet engraftment at any time.
To demonstrate that there was no regeneration or recovery of an endogenous islet cell population in the diabetic NHP, HIP p-islets were eliminated using an anti-CD47 antibody, demonstrating proof of principle of CD47 overexpression and a potential safety switch.
Published preclinical data in Nature Communications, Science Translational Medicine, and Nature Biotechnology describing immune evasion, persistence, and durable anti-tumor activity of HIP-modified CD19-directed CAR T cells and HIP-modified pseudo-islets control type 1 diabetes in preclinical models:

Sana developed HIP-modified CD19-targeted allogeneic CAR T cells and compared them to unmodified CD19-targeted allogeneic CAR T cells in a murine leukemia model with a humanized immune system. Although both HIP-modified and unmodified CAR T cells showed robust early tumor killing, cell durability was much greater in humanized mice treated with HIP-modified cells. HIP-modified allogeneic CAR T cells persisted and removed all evidence of tumor for the duration of the study. HIP-modified CAR T cells also cleared all evidence of tumor after re-injection with cancer cells 90 days into the study.

Preclinical data showed that p-islets survive, persist, escape allogeneic and autoimmune rejection, and normalize blood glucose in diabetic models with humanized immune systems.

Preclinical data demonstrated that HIP-modified cells survive allogeneic transplant across several species, including non-human primates with normal immune systems, and remain fully functional.
Advanced Sana’s HIP ex vivo platform with presentations at AACR (Free AACR Whitepaper), ADA, ISSCR, and ASH (Free ASH Whitepaper):

Presented preclinical data demonstrating that HIP-modified CAR T cells provide lasting tumor control in immunocompetent allogeneic humanized mice even with tumor re-challenge.
Presented preclinical data showing that HIP-modified CD19-directed CAR T cells have the potential to serve as a universal off-the-shelf therapy with long-term durability of response without immunosuppression.
Presented preclinical data showing HIP-modified primary pancreatic islet cells alleviate type 1 diabetes in humanized mice and avoid immune rejection without immunosuppression.
Presented preclinical data showing that intramuscular administration of islet cells in humanized mice does not impact cell function and viability and may serve as a preferred administration route for patients.
Presented preclinical data supporting HIP-modified CD22-directed and GPRC5D-directed allogeneic CAR T cell programs.
Presented preclinical data highlighting the SC379 glial progenitor cell program.
Completed financing with gross proceeds of approximately $189.8 million to further support activities to enable multiple data readouts and announced key corporate updates:

Closed on an upsized public offering in February 2024 of 21.8 million shares of Sana’s common stock, which includes the full exercise of the underwriter’s option, and pre-funded warrants to purchase 12.7 million shares of Sana’s common stock. The gross proceeds from this offering were approximately $189.8 million before deducting underwriting discounts and commissions and estimated offering expenses.
Strengthened the Research and Development leadership with the appointment of two seasoned drug developers, Doug Williams, Ph.D., as President of Research and Development, and Gary Meininger, M.D., as Chief Medical Officer.
Announced an increased focus on the ex vivo cell therapy platform based on extensive preclinical and early translational clinical data and a reduction in near-term investment on the fusogen in vivo delivery platform, resulting in an expected 2024 operating burn below $200 million.
Named on the BioSpace 2024 Best Places to Work small employers list for the second year in a row.
Fourth Quarter 2023 Financial Results

GAAP Results

Cash Position: Cash, cash equivalents, and marketable securities as of December 31, 2023 were $205.2 million compared to $434.0 million as of December 31, 2022. The decrease of $228.8 million was primarily driven by cash used in operations of $253.6 million and cash used for the purchase of property and equipment of $20.0 million. The decrease in cash was partially offset by net proceeds of $27.0 million from at the market equity offerings during the year ended December 31, 2023.

Research and Development Expenses: For the three and twelve months ended December 31, 2023, research and development expenses, inclusive of non-cash expenses, were $63.0 million and $268.8 million, respectively, compared to $63.9 million and $285.9 million for the same periods in 2022. The decrease of $0.9 million for the three months ended December 31, 2023 compared to the same period in 2022 was primarily due to decreased laboratory and research costs, partially due to the portfolio prioritizations in 2022 and 2023, a decline in personnel-related costs, including non-cash stock-based compensation, and lower costs for third-party manufacturing at CDMOs. These decreases were partially offset by costs incurred related to the impairment of certain lab equipment and leasehold improvements, primarily due to the portfolio prioritization in the fourth quarter of 2023 and increased clinical development costs. The decrease of $17.1 million for the twelve months ended December 31, 2023 compared to the same period in 2022 was primarily due to decreased laboratory and research costs partially due to the portfolio prioritizations in 2022 and 2023, lower costs for third-party manufacturing at CDMOs, decreased costs to acquire technology, and lower non-cash stock-based compensation expense. These decreases were partially offset by increased clinical development costs and costs incurred related to the impairment of certain lab equipment and leasehold improvements, primarily due to the portfolio prioritization in the fourth quarter of 2023. Research and development expenses include non-cash stock-based compensation of $4.9 million and $23.2 million, respectively, for the three and twelve months ended December 31, 2023, and $6.0 million and $26.6 million, for the same periods in 2022.

Research and Development Related Success Payments and Contingent Consideration: For the three and twelve months ended December 31, 2023, Sana recognized a non-cash expense of $6.8 million and a non-cash gain of $49.0 million, respectively, in connection with the change in the estimated fair value of the success payment liabilities and contingent consideration in aggregate, compared to gains of $5.5 million and $84.9 million for the same periods in 2022. The value of these potential liabilities may fluctuate significantly with changes in Sana’s market capitalization and stock price.

General and Administrative Expenses: General and administrative expenses for the three and twelve months ended December 31, 2023, inclusive of non-cash expenses, were $20.8 million and $73.3 million, respectively, compared to $23.3 million and $71.6 million for the same periods in 2022. The decrease of $2.5 million for the three months ended December 31, 2023 compared to the same period in 2022 was primarily due lower personnel-related costs, including non-cash stock-based compensation, a decrease in costs related to Sana’s previously planned manufacturing facility in Fremont, California (Fremont facility), which were formerly in research and development expense, and lower insurance costs. These decreases were partially offset by an increase in patent and other legal fees. The increase of $1.7 million for the twelve months ended December 31, 2023 compared to the same period in 2022 was primarily due to an increase in patent and other legal fees, a loss on termination of lease associated with the Fremont facility (Fremont lease), and increased facility costs. These increases were partially offset by the write-off of construction in progress costs in 2022 for the Fremont facility, and a decrease in insurance costs.

Net Loss: Net loss for the three and twelve months ended December 31, 2023 was $88.1 million, or $0.45 per share, and $283.3 million, or $1.46 per share, respectively, compared to $80.4 million, or $0.42 per share, and $269.5 million, or $1.43 per share for the same periods in 2022.

On February 29, 2024 Puma Biotechnology, Inc. (NASDAQ: PBYI), a biopharmaceutical company, reported financial results for the fourth quarter and year ended December 31, 2023. Unless otherwise stated, all comparisons are for the fourth quarter and full year 2023 compared to the fourth quarter and full year 2022 (Press release, Puma Biotechnology, FEB 29, 2024, View Source [SID1234640662]).

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Product revenue, net consists entirely of revenue from sales of NERLYNX, Puma’s first commercial product. Product revenue, net for the fourth quarter of 2023 was $53.2 million, compared to $53.7 million in the fourth quarter of 2022. Product revenue, net for the full year 2023 was $203.1 million, compared to $200.0 million in 2022.

Based on accounting principles generally accepted in the United States (GAAP), Puma reported net income of $12.3 million, or $0.26 per basic and diluted share, for the fourth quarter of 2023, compared to a net loss of $5.6 million, or $0.12 per basic and diluted share, for the fourth quarter of 2022. Net income for full year 2023 was $21.6 million, or $0.46 per basic share and $0.45 per diluted share, compared to a net income of $2,000, or $0.00 per basic and diluted share, for full year 2022.

Non-GAAP adjusted net income was $14.8 million, or $0.31 per basic and diluted share, for the fourth quarter of 2023, compared to non-GAAP adjusted net loss of $3.0 million, or $0.07 per basic and diluted share, for the fourth quarter of 2022. Non-GAAP adjusted net income for full year 2023 was $31.8 million, or $0.68 per basic share and $0.67 per diluted share, compared to non-GAAP adjusted net income of $11.8 million, or $0.26 per basic and diluted share, for full year 2022. Non-GAAP adjusted net income/loss excludes stock-based compensation expense. For a reconciliation of GAAP net income/loss to non-GAAP adjusted net income/loss and GAAP net income/loss per share to non-GAAP adjusted net income/loss per share, please see the financial tables at the end of this news release.

Net cash provided by operating activities for the fourth quarter of 2023 was $10.4 million, compared to $7.7 million for the fourth quarter of 2022. Net cash provided by operating activities for full year 2023 was $27.0 million, compared to net cash used in operating activities of $15.8 million for full year 2022. At December 31, 2023, Puma had cash, cash equivalents, and marketable securities of $96.0 million, compared to cash, cash equivalents, and marketable securities of $81.1 million at December 31, 2022.

"We are pleased to report positive net income for both the fourth quarter and full year 2023," said Alan H. Auerbach, Chairman, Chief Executive Officer and President of Puma. "NERLYNX sales in the fourth quarter were negatively impacted by the lower enrollments seen in Q3, as well as a higher than expected gross to net for the quarter. We have continued to reduce our internal expenses to account for this higher gross to net and lower Q3 enrollments, as we recognize our fiscal responsibility to continue to be net income positive in 2024. Puma also continues to execute on the clinical development of alisertib, and in February, we were pleased to initiate ALISertib in CAncer (ALISCA-Lung1), a Phase II clinical trial of alisertib monotherapy for the treatment of patients with extensive stage small cell lung cancer."

Mr. Auerbach added, "We anticipate the following key milestones over the next 12 months: (i) presentation of biomarker studies from the randomized trial of alisertib plus fulvestrant versus alisertib alone in hormone receptor positive, HER2-negative breast cancer (H1 2024); (ii) updated data from the clinical trial of alisertib in combination with osimertinib in patients with metastatic EGFR-mutant non small cell lung cancer who have developed osimertinib resistance (H1 2024); (iii) initiation of ALISCA-Breast1, a Phase II trial of alisertib in combination with endocrine treatment in patients with chemotherapy-naïve HER2-negative, hormone receptor-positive metastatic breast cancer (Q4 2024); and (iv) interim data from ALISCA-Lung1, a Phase II clinical trial of alisertib monotherapy for the treatment of patients with extensive stage small cell lung cancer (H2 2024)."

Revenue

Total revenue consists of product revenue, net from sales of NERLYNX, license revenue and royalty revenue. For the fourth quarter of 2023, total revenue was $72.2 million, of which $53.2 million was product revenue, net, and $19.0 million was royalty revenue. This compares to total revenue of $65.7 million for the fourth quarter of 2022, of which $53.7 million was product revenue, net, and $12.0 million was royalty revenue. For the year ended December 31, 2023, total revenue was $235.6 million, of which $203.1 million was product revenue, net, and $32.5 million was royalty revenue. This compares to total revenue in 2022 of $228.0 million, of which $200.0 million was product revenue, net, and $28.0 million was royalty revenue.

Operating Costs and Expenses

Total operating costs and expenses were $57.4 million for the fourth quarter of 2023, compared to $55.7 million for the fourth quarter of 2022. Total operating costs and expenses were $203.0 million for full year 2023, compared to $204.3 million for full year 2022.

Cost of Sales

Cost of sales was $24.3 million for the fourth quarter of 2023, compared to $16.8 million for the fourth quarter of 2022. Cost of sales was $62.7 million for full year 2023, compared to cost of sales of $55.1 million for full year 2022.

Selling, General and Administrative Expenses

Selling, general and administrative (SG&A) expenses were $20.2 million for the fourth quarter of 2023, compared to $25.1 million for the fourth quarter of 2022. SG&A expenses for full year 2023 were $89.9 million, essentially unchanged from $90.0 million for full year 2022. The slight increase includes an increase in payroll and related costs of approximately $3.5 million, primarily due to a one-time $2.0 million CARES Act credit in 2022, increased compensation of $1.5 million in 2023, and a $0.9 million credit loss reserve. These increases were offset by a decrease of $4.1 million in professional fees and expenses related to consultants and contractors, as well as lower insurance expenses and administrative costs.

Research and Development Expenses

Research and development (R&D) expenses were $12.9 million for the fourth quarter of 2023, compared to $13.8 million for the fourth quarter of 2022. R&D expenses for full year 2023 were $50.4 million, compared to $52.2 million for full year 2022. The $1.8 million decrease in R&D expenses during full year 2023 compared to full year 2022 resulted primarily from the reduction and closure of NERLYNX clinical trial sites of approximately $4.7 million, partially offset by an increase in internal R&D expenses of approximately $3.2 million, primarily due to a tax credit recorded during the year ended December 31, 2022 under the CARES Act, without a comparable tax credit in 2023.

Acquired In-Process Research and Development Expense

Puma recorded acquired in-process R&D expense related to an alisertib up-front payment of $7.0 million during the year ended December 31, 2022. No similar expenses were recorded in 2023.

Total Other Income (Expenses)

Total other expenses were $2.0 million for the fourth quarter of 2023, compared to $15.3 million for the fourth quarter of 2022. Total other expenses were $9.9 million for full year 2023, compared to $23.2 million for full year 2022. The $13.3 million decrease in other expenses in full year 2023 resulted primarily from legal verdict expenses recorded in 2022, with no similar accruals in 2023, as well as an increase in other income related to higher interest rates in 2023.

First Quarter 2024 and Full Year 2024 Financial Outlook

First Quarter 2024

Full Year 2024

Net Product Revenue

$38 – $40 million

$183 – $190 million

Royalty Revenue

$2.5 – $3 million

$30 – $33 million

License Revenue

$0 million

$1 – $2 million

Net Income/(Loss)

$(10) – $(12) million

$12 – $15 million

Gross to Net Adjustment

23% – 24%

21.5% – 22.5%

Conference Call

Puma Biotechnology will host a conference call to discuss its fourth quarter and full year 2023 financial results and provide an update on Puma’s business and outlook at 1:30 p.m. PST/4:30 p.m. EST on Thursday, February 29, 2024. The call may be accessed by dialing 1-877-709-8150 (domestic) or 1-201-689-8354 (international). Please dial in at least 10 minutes in advance and inform the operator that you would like to join the "Puma Biotechnology Conference Call." A live webcast of the conference call and presentation slides may be accessed on the Investors section of the Puma Biotechnology website at View Source A replay of the call will be available approximately one hour after completion of the call and will be archived on Puma’s website for 90 days.