On August 19, 2024 Akari Therapeutics, Plc (Nasdaq: AKTX), an innovative biotechnology company developing advanced therapies for autoimmune and inflammatory diseases, reported financial results for the second quarter ended June 30, 2024 as well as recent company highlights (Press release, Akari Therapeutics, AUG 19, 2024, View Source [SID1234645976]).
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"Moving into my fourth month as Interim CEO of Akari, we continue to make progress on multiple fronts. We prioritized our PAS-nomacopan geographic atrophy development program, and I am pleased to report we are making steady progress. In July we received positive and constructive Pre-IND (PIND) feedback from the US FDA and based on the feedback, we plan on filing an IND application in 2025 for our Phase 1 clinical studies of PAS-nomacopan in geographic atrophy. In addition, in support of this IND application, I am happy to share that we have released our first full-scale batch of drug substance under applicable Good Manufacturing Practice (GMP) conditions, which will be suitable for clinical use. This manufacturing has been supported by our manufacturing partner, Wacker Biotech GmbH. Sufficient clinical material has been produced to support both the final IND-enabling studies and initial clinical development in geographic atrophy (GA). I would like to thank the FDA as well as Dr. Miles Nunn and his development team at Akari, who have worked tirelessly to advance the development of PAS-nomacopan into the clinic," stated Dr. Samir R. Patel, Interim CEO of Akari.
"Our merger with Peak Bio continues to progress and we remain on track for a fourth quarter closing," continued Dr. Patel. "We continue to explore licensing and partnership opportunities for both nomacopan and PAS-nomacopan."
Recent Company Highlights
Announced portfolio prioritization plan for combined go-forward company which will focus on Peak’s antibody drug conjugate (ADC) platform technology and Akari’s PAS-nomacopan GA program. As a result of this prioritization, the Company’s HSCT-TMA program was suspended.
Announced key leadership changes, including the appointment of experienced life sciences entrepreneur Samir R. Patel, M.D. as interim CEO. Interim CEO employment contract consists solely of equity compensation.
Implemented reduction-in-force as part of an operational restructuring plan, which included the elimination of certain senior management positions, to reduce operating costs while supporting the Company’s long-term strategic plan.
Issued unsecured convertible, short-term promissory notes to Dr. Patel and Ray Prudo, M.D., the Company’s Chairman of the Board, each in the amount of $500,000 to provide operating capital.
Raised a total of $7.6 million in gross proceeds from a private placement of ADSs and warrants with certain investors, including Dr. Patel and Dr. Prudo.
Received positive and constructive regulatory feedback from the US FDA for PAS-nomacopan in the treatment of GA which will provide alignment and clarity on Akari’s IND enabling preclinical plans and clinical strategy prior to advancement into Phase 1 clinical studies. Based on the FDA’s feedback, the company plans to file an IND application for the use of PAS-nomacopan in GA in the second half of 2025.
Full-scale drug substance GMP batch manufactured by Wacker Biotech GmbH has been released and is suitable for use in the clinic, providing enough clinical material to support both the final IND-enabling studies and initial clinical development in GA.
Second Quarter 2024 Financial Results
As of June 30, 2024, the Company had cash of $4.2 million, compared to $3.8 million as of December 31, 2023.
Research and development expenses were $3.3 million and $5.6 million for the three and six months ended June 30, 2024, respectively, as compared to $1.5 million and $3.3 million, respectively, for the same periods in 2023. The increases on a year-to-date basis were due primarily to increases in manufacturing costs associated with the development of PAS-nomacopan.
General and administrative expenses were $2.2 million and $4.9 million for the three and six months ended June 30, 2024, respectively, as compared to $3.1 million and $6.0 million, respectively, for the same periods in 2023. The decreases on a year-to-date basis were due primarily to decreased headcount as part of the implementation of a reduction-in-force as part of our operational restructuring plan that was announced in May 2024.
Merger-related costs were $0.3 million and $1.3 million for the three and six months ended June 30, 2024, respectively, and represent costs incurred directly related to the proposed merger with Peak Bio, which was announced in March 2024. No such costs were incurred during the same periods in 2023.
Restructuring and other costs were $1.6 million for each of the three and six months ended June 30, 2024 and relate to costs incurred directly related to the reduction-in-force as part of our operational restructuring plan, which was announced in May 2024. No such costs were incurred during the same periods in 2023.
Net loss was $7.6 million and $13.1 million for the three and six months ended June 30, 2024, respectively, as compared to $4.0 million and $3.0 million, respectively, for the same periods in 2023.
Readers are referred to, and encouraged to read in its entirety, the company’s Quarterly Report on Form 10-Q for the three and six months ended June 30, 2024, as filed with the Securities and Exchange Commission on August 19, 2024, which includes further detail on the Company’s business plans, operations, financial condition, and results of operations.
About the Merger
On March 5, 2024, Akari and Peak Bio announced a definitive agreement to merge as equals in an all-stock transaction. The combined entity will operate as Akari Therapeutics, Plc, which is expected to continue to be listed and trade on the Nasdaq Capital Market as AKTX, under the Chairmanship of Hoyoung Huh, MD, PhD. Under the terms of the agreement, Peak stockholders will receive a number of Akari ordinary shares (represented by American Depositary Shares) for each share of Peak stock they own, as determined on the basis of the exchange ratio described in the agreement. The exchange is expected to result in implied equity ownership in the combined company of approximately 50% for Akari shareholders and approximately 50% for Peak stockholders on a fully diluted basis, subject to adjustment under certain circumstances, including based on each party’s relative level of net cash at the closing of the proposed transaction. The transaction is expected to close in the fourth quarter of this year subject to the satisfaction of customary closing conditions, including approval by the shareholders of both companies.