On April 10, 2024 Ryvu Therapeutics (WSE: RVU), a clinical-stage drug discovery and development company focusing on novel small molecule therapies that address emerging targets in oncology, reported preclinical data from its synthetic lethality pipeline, RVU120, and MEN1703 (SEL24) at the 2024 AACR (Free AACR Whitepaper) Annual Meeting, April 5-10 in San Diego, California (Press release, Ryvu Therapeutics, APR 10, 2024, View Source [SID1234641993]).

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"We are excited to present our latest advancements in oncology therapeutics at the AACR (Free AACR Whitepaper) Annual Meeting this year. Strong preclinical data from our two lead synthetic lethality programs – PRMT5 and WRN – are encouraging as we make progress toward the identification of competitive clinical candidates," said Krzysztof Brzózka, Ph.D., Chief Scientific Officer of Ryvu Therapeutics.

Dr. Brzózka added, "We are also proud of our ONCO Prime target discovery platform, which recently received a significant grant from the Polish Agency for Enterprise Development, giving validation and financial support to our innovative drug discovery efforts. At AACR (Free AACR Whitepaper), we present promising data in KRAS-mutant patient-derived colorectal cancer cells, where the ONCO Prime platform has identified promising novel drug targets. With these initial data, we continue to expand the platform’s potential to discover novel anticancer targets across various tumor types."

The ONCO Prime target discovery platform aims to identify novel drug targets based on patient-derived primary cell cultures, omics characterization, and functional assays. It already supports preclinical development of Ryvu programs, including PRMT5 and WRN. In March 2024, the Polish Agency for Enterprise Development (PARP) recommended awarding a PLN 26 million (approx. USD 6.6 million) grant to Ryvu to cover five years of ONCO Prime research activities retroactive to May 2023. The ONCO Prime platform covers a broad spectrum of tumor types, and data from colorectal cancer are presented in AACR (Free AACR Whitepaper) Poster No. 4684, ‘A comprehensive platform for identification of KRAS-specific synthetic lethal targets using patient-derived cells.’

AACR 2024 Poster highlights:

Abstract Title: ‘Discovery of novel MTA-cooperative PRMT5 inhibitors as targeted therapeutics for MTAP-deleted cancers.’
Session Name: HDAC and Methyltransferase Inhibitors
Session date and time: Tuesday, April 9, 9:00 AM – 12:30 PM PST
Poster Number: 4598

Ryvu has developed potentially best-in-class MTA-cooperative PRMT5 inhibitors showing favorable drug-like properties and effective PRMT5 inhibition dependent on MTA binding.
Ryvu PRMT5 inhibitor has a robust antiproliferative effect on MTAP-deleted cell lines and provides a good safety window for MTAP WT cells, as shown in a wide cell line panel.
Novel Ryvu compounds are characterized by significantly improved PK profile that allow for oral administration.
In vitro safety evaluations did not reveal any significant liabilities of the tested compounds.
The correlation between compound exposure and on-target effect was confirmed in PK/PD and efficacy studies in MTAP-deleted tumor models.
Abstract Title: ‘Discovery of WRN inhibitors as targeted therapy in the treatment of microsatellite unstable (MSI-H) tumors.’
Session Name: Novel Antitumor Agents 4
Session date and time: Tuesday, April 9, 1:30 PM – 05:00 PM PST
Poster Number: 5942

Structure-based optimization performed at Ryvu facilitated the rapid expansion and delivery of a compound library with novel intellectual property (IP), demonstrating target engagement in cells and selective potency over other RecQ family members.
The pharmacokinetic properties of these compounds were favorable, allowing progress to in vivo studies, which confirmed the efficacy of Ryvu’s WRN inhibitors in xenograft MSI-H cancer models.
Data on Ryvu’s WRN inhibitors provide pharmacological proof-of-concept with synthetic lethal effect and support WRN inhibition as a new, targeted oncological therapy in MSI-high tumors.
Abstract Title: ‘A comprehensive platform for identification of KRAS-specific synthetic lethal targets using patient-derived cells.’
Session Name: New Targets, Technologies, and Drug Delivery Systems
Session date and time: Tuesday, April 9, 9:00 AM – 12:30 PM PST
Poster Number: 4684

Ryvu’s cutting-edge drug discovery platform uniquely combines high throughput capabilities with the precision and translational impact traditionally associated with later, lower throughput stages.
By leveraging human stem cell-derived model cells (PDC), patient-derived xenografts (PDXs) and clinical samples, we have created a groundbreaking approach to identifying synthetic lethal (SL) targets specific to oncogenic pathways.
In conjunction with our novel ranking algorithm, these models have successfully identified potential drug targets in KRAS-mutant cells—targets that remained undetected in immortalized CRC cell lines, likely due to genetic and epigenetic alterations accumulated over years of cell culture.
Chemical compound screening has produced promising results that have been further validated through comparison with a varied collection of patient-derived CRC cultures, ensuring the findings’ reliability and clinical relevance.
These data position Ryvu’s primary model platform as an invaluable resource for target discovery research with broad applicability across a variety of tumors.
Abstract Title: ‘Combination JAK1/2 and CDK8/19 inhibition demonstrates enhanced efficacy in myeloproliferative neoplasms.’
Session Name: Targeted, Combination, and Differentiation Therapies
Session date and time: Wednesday, April 10, 9:00 AM – 12:30 PM PST
Poster Number: 7225

RVU120, a highly selective and potent CDK8/19 inhibitor, shows potential efficacy as both monotherapy and in combination with ruxolitinib (RUX), a JAK1/2 inhibitor, for the treatment of myeloproliferative neoplasms (MPN) and polycythemia vera (PV).
In vivo treatment with RVU120/RUX+RVU120 significantly reduced disease manifestation (splenomegaly, WBC, fibrosis scoring, hematopoiesis) compared to VEH/RUX.
These data suggest that inhibition of JAK1/2 and CDK8/19 could be a novel therapeutic strategy in MPNs.
Abstract Title: ‘MEN1703/SEL24 exhibits promising antitumoral activity in preclinical models of myelofibrosis both as a single agent and combined with ruxolitinib.’
Session Name: Novel Antitumor Agents 2
Session date and time: Sunday, April 7, 01:30 AM – 05:00 PM PST
Poster Number: 665

MEN1703 (SEL24) demonstrates efficacy both as a monotherapy and in combination with the JAK inhibitor ruxolitinib (RUX) in preclinical models of myelofibrosis (MF).
MEN1703 demonstrated anti-tumoral efficacy in MF preclinical models, exhibiting in vitro activity at clinically relevant concentrations. Notably, the combination of MEN1703 with the standard of care, RUX, exhibited synergistic effects and molecular analyses confirmed the inhibition of downstream targets of PIM.
The results support the therapeutic potential and relevance of MEN1703 in treating myelofibrosis.
Posters are available on View Source

On April 10, 2024 TORL BioTherapeutics, LLC (TORL), a clinical-stage biotechnology company involved in discovery and development of new antibody-based immunotherapies designed to improve and extend the lives of patients with cancer worldwide reported that the Company announced its closing of an oversubscribed $158 million Series B-2 financing (Press release, TORL Biotherapeutics, APR 10, 2024, View Source [SID1234641992]). The financing led by Deep Track Capital, with new participation from leading global biotechnology investors including RA Capital Management, Perceptive Advisors, and Avidity Partners as well as all existing biotechnology investors including Goldman Sachs Alternatives, UC Investments, Bristol Myers Squibb, Vertex Ventures HC, Moore Strategic Ventures, Blue Owl Healthcare Opportunities, and Perceptive Xontogeny Venture Fund, brings the total raised to date to greater than $350 million. Proceeds from this Series B-2 financing will be used to continue the clinical development of TORL-1-23, the Company’s first-in-class ADC to treat CLDN 6+ tumors, through Phase 1 and a pivotal Phase 2 trial that will start in the second half of 2024. This Phase 2 trial is designed to facilitate regulatory review and potential approvals for TORL-1-23 as a new therapy for patients with CLDN 6+, platinum-resistant ovarian cancer. Proceeds will also be used to fund the on-going Phase 1 studies for the TORL-2-307 program, both a monoclonal antibody (mAb) and an ADC, for the treatment of CLDN 18.2+ solid tumors, TORL-3-600, an ADC for the treatment of CDH17+ colorectal cancer, and TORL-4-500, an ADC for the treatment of Delta like non-canonical Notch Ligand 1 (DLK1) positive solid tumors.

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"We are grateful for the continued support from our existing world-class life sciences investors and are extremely pleased to add RA Capital Management, Perceptive Advisors, and Avidity Partners to the TORL team," said Mark Alles, TORL’s Chairman and CEO. "This investment significantly enhances our opportunity to deliver multiple data-driven milestones from our novel antibody-based discovery platform and clinical-stage oncology drug development pipeline."

"Our leadership of the TORL Series B-2 Financing reflects our confidence in the scientific and business expertise of the TORL team, and the promise and potential of the Company’s emerging ADC pipeline," said Rebecca Luse, Principal at Deep Track Capital. "The era of ADCs in oncology has arrived, and TORL is well-positioned to succeed in this rapidly growing approach to treating cancer."

TORL’s pipeline of targets, ADCs and mAbs were discovered in the laboratory of Board Member and Scientific Co-founder Dennis Slamon, M.D., Ph.D., Professor of Medicine, and Chief of the Division of Hematology/Oncology at UCLA’s David Geffen School of Medicine. Dr. Slamon is an accomplished medical oncologist and scientist whose research was pivotal in the identification of HER2 as a therapeutic target in breast cancer and the subsequent development and regulatory approvals for trastuzumab (HerceptinÒ). His laboratory and research team also defined CDK4/6 as a therapeutic target in hormone receptor positive (HR+) breast cancer. Subsequently, Dr. Slamon’s group led the clinical development of CDK4/6 inhibitors, resulting in global regulatory approvals for Palbociclib (IbranceÒ) and Ribociclib (KisqaliÒ) for the clinical management of HR+ breast cancer.

"TORL is built on more than thirty years of experience discovering molecular alterations associated with solid tumors and hematologic malignancies. This work is followed by development of new and novel targeted therapeutics and clinical strategies for their use to improve and extend the lives of patients challenged with these diseases," said Dr. Slamon. "We are pleased at the spectrum of diseases for which this approach appears to work as well as the performance of our predictive and development platforms to date. We remain committed to delivering many more breakthrough therapies for patients with serious unmet global medical needs in cancer."

The Company was co-founded in 2019 by Board Member, President, and CFO Dave Licata. Through TORL’s innovative and strategic partnership with the Slamon Research Laboratory at UCLA, the Company was granted exclusive development and commercialization rights to a large portfolio of biologics-based drugs designed to target specific antigens overexpressed in cancer cells. Mr. Licata’s and Dr. Slamon’s common vision for a new approach to antibody-based drug development created TORL and its pipeline of promising cancer therapies.

"TORL’s oversubscribed Series B-2 financing provides the capital necessary for TORL to complete our pivotal, registration-enabling Phase 2 study starting later this year for TORL-1-23, a first-in-class, and potentially best-in-class, ADC targeting CLDN 6 in platinum-resistant ovarian cancer. It also allows us to continue to advance our three other promising clinical stage programs and pipeline," said Mr. Licata. "With this continued strong support from our investors, we believe we can generate significant long-term value for them, our employees, and most importantly, the patients we seek to serve."

Vince Ruiz from Crandon Law LLC served as lead counsel to TORL BioTherapeutics, LLC.

Schulte, Roth & Zabel LLP served as counsel to Deep Track Capital.

About the TORL123-001 (TRIO-049) Clinical Study
Select centers are enrolling patients in Part 2, expansion, of TORL’s phase 1 study, TORL123-001 (TRIO-049), assessing the safety, pharmacokinetics, biomarkers, and antitumor activity of TORL-1-23. Further details including current study sites can be found at View Source

About TORL2307MAB-001 (TRIO-051) Clinical Study
TORL is currently enrolling patients in Part 2, the expansion portion, of their phase 1 study, TORL2307MAB-001 (TRIO-051), assessing the safety, pharmacokinetics, biomarkers, and antitumor activity of TORL-2-307MAB at select global sites around the world. Further details including current study sites can be found at View Source

About TORL2307ADC-001 (TRIO-052) Clinical Study
TORL’s Phase 1 study, TORL2307ADC-001 (TRIO-052), is currently open to enrollment for the expansion portion, Part 2, assessing the safety, pharmacokinetics, biomarkers, and antitumor activity of TORL-2-307ADC. Further details including current study sites can be found at View Source

About TORL3600-001 (TRIO-055) Clinical Study
A limited set of sites are currently enrolling patients in the escalation portion of TORL’s phase 1 study, TORL3600-001 (TRIO-055), assessing the safety, pharmacokinetics, biomarkers, and antitumor activity of TORL-3-600. Further details including current study sites can be found at View Source

About TORL 4-500-001 (TRIO-056) Clinical Study
This Phase 1 study, TORL4500-001 (TRIO-056), is actively enrolling patients in the escalation portion, part 1, assessing the safety, pharmacokinetics, biomarkers, and antitumor activity of TORL-4-500. The study is open at an exclusive group of sites. Further details including current study sites can be found at View Source

On April 10, 2024 Aptevo Therapeutics Inc. (NASDAQ:APVO), a clinical-stage biotechnology company focused on developing novel immune-oncology therapeutics based on its proprietary ADAPTIR and ADAPTIR-FLEX platform technologies, reported advancements in both clinical programs and one preclinical program (Press release, Aptevo Therapeutics, APR 10, 2024, View Source [SID1234641991]).

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A heavily pretreated breast cancer patient, enrolled in the ALG.APV-527 Phase 1 open-label, multi-center, multi-cohort trial for the treatment of multiple solid tumor types, entered the trial and improved from progressive disease to long-lasting stable disease (SD) while on therapy. The patient has remained on study for more than nine months and been successfully transitioned to a higher dose level, which may allow for increased clinical benefit. The trial is more than 50% enrolled and dosing in cohort five (of six) is imminent.

"I’m encouraged by the promise that ALG.APV-527 brings to the treatment of solid tumor patients. Witnessing a patient maintaining a stable disease, especially for more than nine months, and then moving to a higher dose level within a Phase 1 trial is uncommon, but we believe it can be therapeutically beneficial for this patient and is a testament to the drug’s clinical potential," stated Dirk Huebner, MD, Chief Medical Officer at Aptevo.

The Company is on track to initiate part 1 of its upcoming two-part Phase 1b/2 trial in 1H 2024. The study will further evaluate APVO436 for the treatment of acute myeloid leukemia (AML). Aptevo has partnered with premier CRO, Prometrika, for the upcoming study. The first part is a dose optimization trial evaluating standard of care venetoclax + azacitidine along with APVO436 as a frontline treatment for AML patients. It is planned as an open-label, multi-center, multi-cohort study. The trial will evaluate safety/tolerability and efficacy of the triplet combination at multiple dose levels.

The therapeutic combination of venetoclax + azacitidine + APVO436 was selected based on outcomes from the Company’s dose expansion trial that showed promising outcomes across all categories of evaluation including safety, efficacy, and duration of remission.

"We are eager to initiate the next phase of development in support of lead candidate APVO436 as a therapeutic option in combination therapy for the treatment of AML," said Marvin White, President and CEO of Aptevo. "APVO436 results have been positive across the board. For example, we demonstrate an exemplary safety profile, noting that patients experienced cytokine release syndrome at rates that are about one-third the benchmarks demonstrated in literature. Similarly, efficacy results demonstrate clinical responses that are almost double the benchmarks in literature. We anticipate that our dose optimization results will reinforce our growing body of data and demonstrate the clinical potential of APVO436 in patients with frontline AML."

APVO711 is currently progressing through preclinical evaluation intended to target a broad range of solid tumors. The Company continues to move this anticancer checkpoint inhibitor with added dual mechanism of action functionality toward the clinic. Key learnings to date include:

APVO711 imparts beneficial attributes to both antigen presenting cells and T cells that boost the immune response targeted at controlling tumor cells
Experiments in cultured cells have confirmed that APVO711 enhances tumor cell killing by T cells
In vivo studies have confirmed that APVO711 reduces the size of PD-L1-expressing tumors
"We are pleased with the progress we have made to date in preclinical studies for our dual mechanism checkpoint inhibitor APVO711. This PD-L1 x CD40 molecule, represents an anticancer approach that combines a checkpoint inhibitor with a potent immune mediator. This innovative therapeutic strategy holds promise for unleashing the full potential of the immune system to combat cancer, offering new hope for patients in need of more effective treatments," said Michelle H. Nelson, Ph.D., Director of Immunobiology at Aptevo Therapeutics.

More About the Programs

ALG.APV-527
ALG.APV-527 is a conditional 4-1BB agonist bispecific that is designed for activation only upon simultaneous binding to 4-1BB and 5T4. It is designed to target cancer cells by activating both T cells and natural killer cells and is intended to bind to tumor-specific antigens while sparing healthy cells and maximizing immune response. This has the potential to be clinically important because 4-1BB can stimulate the immune cells (antitumor-specific T cells and NK cells) involved in tumor control, making 4-1BB a particularly compelling target for cancer immunotherapy. The compound is currently being evaluated for multiple solid tumor types in a multi-center, dose escalation trial that is more than 50% enrolled.

Additional promising preliminary data includes:

In addition to the patient described above, a second heavily pretreated breast cancer patient who was progressing prior to enrolling in the trial has sustained long lasting stable disease and remained on study drug for seven months. Analysis demonstrated measurable level of drug in circulation (pharmacokinetic) and reproducible elevation of serum pharmacodynamic markers with dosing, suggesting the drug is biologically active
Treatment to date has been overall well-tolerated, and a maximum tolerated dose has not yet been determined, dose-escalation in higher-dose cohorts is ongoing as the Company moves into cohort five (of six)
ALG.APV-527 has been measurable in all patients with plasma concentration of ALG.APV-527 consistent with the administered dose
Biomarker analyses indicate the expression of the targets (4-1BB and 5T4) in tumor biopsies and confirm biological activity of ALG.APV-527
"We are excited by the emerging data from the ALG.APV-527 clinical trial, indicating biological activity and generating stable disease even at the lowest dose levels tested in heavily pretreated patients. This molecule is engineered to target cancer cells while preserving healthy tissues, all the while amplifying a specific immune response. We eagerly anticipate sharing forthcoming data and continuing to unveil the immense potential of this bispecific candidate in the solid tumor space," expressed Dirk Huebner, MD, Chief Medical Officer at Aptevo.

APVO436
Aptevo’s wholly owned lead proprietary drug candidate, APVO436 is targeting AML and is differentiated by design to redirect the immune system of the patient to destroy leukemic cells and leukemic stem cells expressing the target antigen CD123, which is a compelling target for AML due to its overexpression on leukemic stem cells and AML blasts . This antibody-like recombinant protein therapeutic is designed to engage both leukemic cells and T cells of the immune system and bring them closely together to trigger the destruction of leukemic cells. APVO436 is purposefully designed to reduce the likelihood and severity of CRS by use of a unique CD3 derived from CRIS-7 vs. the CD3 used by other competitors. APVO436 has received orphan drug designation ("orphan status") for AML according to the Orphan Drug Act.

The Phase 1b Dose escalation trial results showed a 91% clinical benefit rate in combination with venetoclax + azacitidine in venetoclax naïve patients, a 27% incidence of CRS across all trial cohorts (the majority were grades 1 & 2) and meaningful duration of remission, including three patients who transitioned to transplant after receiving therapy, the best possible outcome for AML patients.

The Company is planning to commence the first part of the Phase 1b/2 dose optimization program in the first half of 2024.

APVO711
APVO711, a bispecific checkpoint inhibitor with added functionality, targets PD-L1 and CD40, and is designed to function to synergistically induce a biological response. This is achieved by simultaneously engaging in two clinically validated T cell activating mechanisms: 1) blocking of PD-L1/PD-1 inhibitory pathway and 2) CD40 signaling augments APC maturation resulting in enhanced T cell stimulation. APVO711 is designed to activate CD40 only in the presence of PD-L1 binding for an improved safety profile. The Company believes APVO711 has the potential to positively impact the treatment paradigm of multiple solid tumor types for which there is currently significant unmet medical need.

On April 10, 2024 Theratechnologies Inc. ("Theratechnologies" or the "Company") (TSX: TH) (NASDAQ: THTX), a biopharmaceutical company focused on the development and commercialization of innovative therapies, reported business highlights and financial results for the first quarter of fiscal year 2024 ended February 29, 2024 (Q1 2024) (Press release, Theratechnologies, APR 10, 2024, View Source [SID1234641990]). All figures are in US dollars unless otherwise stated.

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"I am pleased to wrap up the quarter by reaffirming our full year 2024 guidance of revenues between $87 and $90 million and an Adjusted EBITDA in the range of $13-15 million. Our new cost structure together with our strategic focus on commercial capabilities puts Theratechnologies on the brink of producing stronger cash flow and value for shareholders," said Paul Lévesque, President and Chief Executive Officer at Theratechnologies. "EGRIFTA SV continues to be our engine of growth and according to key performance metrics such as enrollments and unique patients, we are on track to achieve and even surpass our long-term objectives. As anticipated during our recent fourth quarter call, we are experiencing some variability in revenue growth reporting based on the buildup and subsequent drawdown of inventories in the early part of fiscal 2023. Despite lower revenues this quarter, we expect a reverse trend in the second quarter and an evening out of revenues in the second half of 2024. We continue to demonstrate strength on the bottom line, with an improved net loss of $4.4 million versus a net loss of $10.4 million in Q1 2023. This quarter also marks our third consecutive quarter of near-flat-to-positive Adjusted EBITDA, up more than $3.6 million2 from Q1 2023."

Lévesque added, "Following our recent Type A meeting with the FDA on the sBLA for tesamorelin F8, we remain on track to resubmit our file and receive a decision from the FDA on this new product formulation before the end of 2024. With M&A more important than ever to the evolution of portfolio and our overall growth strategy, I am confident that our positive trajectory of Adjusted EBITDA will facilitate the acquisition of new assets that should contribute to value creation for our business. We continue to prioritize our Phase 1 clinical trial studying sudocetaxel zendusortide in advanced ovarian cancer and welcome its acceleration with the recent milestone of the enrollment of the next cohort of patients at the higher dose level. Now that we have significantly advanced our oncology program with important evidence on multiple PDCs with different payloads, coupled with the more than 40 patients already treated with sudocetaxel zendusortide, we believe we are in a position of strength to continue engaging with a partner for additional developmental steps."

First-Quarter 2024 Revenues
(in thousands of U.S. dollars)

Three Months Ended Change
February 29, 2024 February 28, 2023
EGRIFTA SV net sales 9,586 12,711 (24.6 %)
Trogarzo net sales 6,661 7,197 (7.4 %)
Revenue 16,247 19,908 (18.4 %)

Recent Highlights:

Sudocetaxel Zendusortide (TH1902) and SORT1+ Technology

On February 15, 2024, the Company announced the completion of enrollment of the first six participants in Part 3 of its Phase 1 clinical trial of sudocetaxel zendusortide in patients with advanced ovarian cancer, and on March 21, 2024, we announced that we were moving to the next dose level in Part 3 of its Phase 1 clinical trial of sudocetaxel zendusortide in patients with advanced ovarian cancer. The study’s Medical Review Committee (MRC) has deemed the dose level in the first cohort of patients safe and has approved initiation of the next cohort with an increased dose, in accordance with the updated dose optimization protocol. Study centers are now actively recruiting patients for the second cohort, with one patient already enrolled and treated with the higher dose.

On March 22, 2024, the Company announced that it will phase down its preclinical oncology research activities. The Company will continue to prioritize its ongoing Phase 1 clinical trial of sudocetaxel zendusortide, in patients with advanced ovarian cancer. The phasing down of research activities is aligned with the Company’s focus on its commercial business and will further optimize its organizational cost structure, pursuant to the goal of generating positive Adjusted EBITDA. These changes are expected to result in a restructuring charge of approximately $600,000 in cash charges related to severance and other expenses and approximately $800,000 in non-cash charges. The Company anticipates all charges to be fully taken during 2024.

Appointment of new members to the Board of Directors

On March 21, 2024, the Company announced the appointment of Jordan Zwick, Chief Business Officer at Mirador Therapeutics Inc., to its Board of Directors and as a member of the Company’s Audit Committee.

On April 5, 2024, the Company announced the appointment of Elina Tea, CFA, Chief Financial Officer at GLS North America, to its Board of Directors, as the designated candidate to Investissement Québec ("IQ") pursuant to the shareholder rights agreement entered into between Theratechnologies and IQ in October 2023. Ms. Tea has also been appointed to the Company’s Audit Committee.

With the appointments of Jordan Zwick and Elina Tea, the Company’s Audit Committee will now comprise four independent members including Gérald Lacoste and Frank Holler as Chair.

American Association for Cancer Research ("AACR")

On March 28, 2024, Theratechnologies announced that two posters would be presented at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting 2024, demonstrating the potential of its SORT1+ Technology platform – including novel camptothecin-peptide conjugates and its lead investigational peptide drug conjugate (PDC) candidate, sudocetaxel zendusortide (TH1902), as anticancer treatments.

These preclinical presentations reinforce existing data for sudocetaxel zendusortide to activate anti-PD-L1 immunotherapy tumor cell killing in SORT+1 cancers and provide the first evidence for novel camptothecin-peptide conjugates in the treatment of SORT1+ colorectal cancers.

2024 Revenue and Adjusted EBITDA Guidance

Our anticipated FY2024 revenue guidance range is confirmed between $87 million and $90 million, or growth of the commercial portfolio in the range of 6.4% and 10.0%, as compared to the 2023 fiscal year results. We anticipate Adjusted EBITDA, a non-IFRS measure, to be between $13 and $15 million for fiscal 2024.

First Quarter Fiscal 2024 Financial Results

The financial results presented in this press release are taken from the Company’s Management’s Discussion and Analysis ("MD&A") and interim consolidated financial statements ("Interim Financial Statements") for the three-month period ended February 29, 2024 ("First Quarter Fiscal 2024") which have been prepared in accordance with International Accounting Standard ("IAS") 34, Interim Financial Reporting of International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). The MD&A and the Interim Financial Statements can be found at www.sedarplus.ca, on EDGAR at www.sec.gov and at www.theratech.com. Unless specified otherwise, all amounts in this press release are in U.S. dollars and all capitalized terms have the meaning ascribed thereto in our MD&A.

First Quarter Fiscal 2024 Financial Results

Revenue
Consolidated revenue for the three months ended February 29, 2024, amounted to $16,247,000 compared to $19,908,000 for the same period last year, representing a decrease of 18.4%.

For the first quarter of Fiscal 2024, sales of EGRIFTA SV reached $9,586,000 compared to $12,711,000 in the first quarter of the prior year, representing a decrease of 24.6%. Lower sales of EGRIFTA SV were mostly the result of lower unit sales due to unusual loading of inventories which occurred in the first quarter of 2023 (mostly in December 2022 and January 2023). EGRIFTA SV sales were also impacted by larger government rebates and returns in the first quarter of fiscal 2024.

In the first quarter of Fiscal 2024, Trogarzo sales amounted to $6,661,000 compared to $7,197,000 for the same quarter of 2023, representing a decrease of 7.4%. Trogarzo unit sales in the first quarter of 2024 were down mostly as a result of the inventory loading at specialty pharmacies that occurred in the first quarter of 2023.

Cost of Sales
For the three-month period ended February 29, 2024, cost of sales was $5,284,000 compared to $4,693,000 in the comparable period of Fiscal 2023. In 2024, cost of sales was affected by a $837,000 provision related to the manufacturing of a batch of F8 formulation of tesamorelin, as the F8 Formulation was not yet approved by the FDA for commercialization. Excluding the provision taken in 2024, cost of goods sold was relatively stable for Trogarzo, but was affected for EGRIFTA SV by slightly higher production related costs.

R&D Expenses
R&D expenses in the three-month period ended February 29, 2024, amounted to $3,752,000 compared to $9,356,000 in the comparable period of Fiscal 2023, a decrease of 60%. The decrease during the first quarter of Fiscal 2024 was largely due to lower spending on life-cycle management projects as well as lower activity in our oncology program. R&D expenses in 2023 also included expenses related to the production of the validation batches of BWFI ($536,000) and expenses related to the production of clinical batches of TH1902 ($838,000). No such expenses were recorded in 2024.

Selling Expenses
Selling expenses in the three-month period ended February 29, 2024, amounted to $5,701,000 compared to $6,814,000 in the comparable period of Fiscal 2023 or a 16.3% decrease. Lower selling expenses are related to the management of expenses in alignment with our goal of reaching and maintaining positive adjusted EBITDA on a yearly basis.

General and Administrative Expenses
General and administrative expenses in the first quarter of Fiscal 2024 amounted to $3,756,000, compared to $4,452,000 reported in the same period of Fiscal 2023, representing a decrease of 15.6%. The decrease is a result of lower overall spending across the Company, which results in the lower level of administrative support required.

Net Finance Costs
Net finance costs for the three-month period ended February 29, 2024, were $2,125,000 compared to $4,940,000 in the same period last year. The decrease in net finance cost is mostly due to the loss on debt modification, in 2023, of $2,650,000 related to the issuance of the Marathon Warrants issued in connection to the amendments to the Credit Agreement. Interest expense was $2,274,000, higher than $1,784,000 in 2023, mostly related to the higher interest rate and higher outstanding balance on the Marathon Credit Facility.

Adjusted EBITDA
Adjusted EBITDA was $(247,000) for the first quarter of fiscal 2024 compared to $(3,892,000) for the same period of 2023. The improvement is mainly due to the realignment of expenses with our focus on our commercial operations, and our goal of being adjusted EBITDA positive on a yearly basis. Adjusted EBITDA in the first quarter of 2023 was negatively affected by certain production costs, namely an expense related to the production of the validation batches of BWFI of $536,000, and $838,000 in expenses related to production batches of TH1902. See "Non-IFRS and Non-US-GAAP Measure" above and see "Reconciliation of Adjusted EBITDA" below for a reconciliation to Net Loss for the relevant periods.

Net loss
Taking into account the revenue and expense variations described above, we recorded a net loss of $4,481,000, or $0.10 per share, in the first quarter of Fiscal 2024, a marked improvement from the loss of $10,443,000, or $0.43 per share, recorded in the first quarter of Fiscal 2023.

Financial Position, Liquidity and Capital Resources

Going Concern Uncertainty

As part of the preparation of the Interim Financial Statements, management is responsible for identifying any event or situation that may cast doubt on the Company’s ability to continue as a going concern. Substantial doubt regarding the Company’s ability to continue as a going concern exists if events or conditions, considered collectively, indicate that the Company may be unable to honor its obligations as they fall due during a period of at least, but not limited to, 12 months from February 29, 2024. If the Company concludes that events or conditions cast substantial doubt on its ability to continue as a going concern, it must assess whether the plans developed to mitigate these events or conditions will remove any possible substantial doubt.

For the three-month ended February 29, 2024, the Company incurred a net loss of $4,481,000 (2023-$10,443,000) and had positive cash flows from operating activities of $1,421,000 (2023- $2,361,000). As at February 29, 2024, cash amounted to $32,240,000 and bonds and money market funds amounted to $6,213,000.

The Company’s loan facility with its lender Marathon (the "Loan Facility") contains various covenants, including minimum liquidity covenants whereby the Company needs to maintain significant cash, cash equivalent and eligible short-term investments balances in specified accounts, which restricts the management of the Company’s liquidity (refer to Note 6 of the Interim Financial Statements). A breach of the liquidity covenant (a "Liquidity Breach") provides the lender with the ability to demand immediate repayment of the Loan Facility and makes available to the lender the collateralized assets, which include substantially all cash, bonds and money market funds which are subject to control agreements, and may trigger an increase of 300 basis points of the interest rate on the outstanding loan balance. During Fiscal 2023, the Company incurred a Liquidity Breach and entered into several amendments to the Marathon Credit Agreement to amend certain of the terms and conditions therein (see note 6 of the Interim Financial Statements).

As of February 29, 2024, the material covenants of the credit agreement providing for the Loan Facility, as amended ( the "Marathon Credit Agreement") include: (i) minimum liquidity requirements to be between $15,000,000 and $20,000,000, based on the Marathon adjusted EBITDA (as defined in the Marathon Credit Agreement, the "Marathon Adjusted EBITDA") targets over the most recently ended four fiscal quarters; and, (ii) quarterly minimum Marathon Adjusted EBITDA targets There is no assurance that the lender will agree to amend or to waive any future potential covenant breaches, if any. The Company does not meet the condition precedents to drawdown additional amounts under the Marathon Credit Agreement and does not currently have other committed sources of financing available to it.

The Company’s ability to continue as a going concern for a period of at least, but not limited to, 12 months from February 29, 2024, involves significant judgement and is dependent on the adherence to the conditions of the Marathon Credit Agreement or to obtain the support of the lender (including possible waivers and amendments, if necessary), increase its revenues and the management of its expenses (including the reorganization mainly focused on its R&D activities) in order to meet or exceed the Marathon Adjusted EBITDA target and generate sufficient positive operating cash flows. Some elements of management’s plans are outside of management’s control and the outcome cannot be predicted at this time. Should management’s plans not materialize, the Company may be in default under the Marathon Credit Agreement, be forced to reduce or delay expenditures and capital additions and seek additional alternative financing, or sell or liquidate its assets. As a result, there is material uncertainty related to events or conditions that cast substantial doubt about the Company’s ability to continue as a going concern.

The Interim Financial Statements have been prepared assuming the Company will continue as a going concern, which assumes the Company will continue its operations in the foreseeable future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The Interim Financial Statements do not include any adjustments to the carrying values and classification of assets and liabilities and reported expenses that might result from the outcome of this uncertainty and that may be necessary if the going concern basis was not appropriate for the Interim Financial Statements. If the Company was unable to continue as a going concern, material impairment of the carrying values of the Company’s assets, including intangible assets, could be required.

Analysis of cash flows

We ended the first quarter of fiscal 2024 with $38,453,000 in cash, bonds and money market funds. Available cash is invested in highly liquid fixed income instruments including governmental and municipal bonds, and money market funds.

For the three-month period ended February 29, 2024, cash used in operating activities before changes in operating assets and liabilities improved to $3,129,000, compared to $5,700,000 in the comparable period of Fiscal 2023.

In the first quarter of fiscal 2024, changes in operating assets and liabilities had a positive impact on cash flow of $1,421,000 (2023-positive impact of $2,361,000). These changes included a positive impact from lower accounts receivable ($3,027,000), lower prepaid expenses and deposits ($567,000), and higher accounts payable ($1,422,000). These positive impacts were offset by an increase in provisions ($3,382,000).

During the first quarter of 2024, cash provided by investing activities amounted to $134,000, and financing activities used $275,000 in cash.

Non-IFRS and Non-U.S. GAAP Measure

The information presented in this press release includes a measure that is not determined in accordance with International Financial Reporting Standards ("IFRS") or U.S. generally accepted accounting principles ("U.S. GAAP"), being the term "Adjusted EBITDA". "Adjusted EBITDA" is used by the Corporation as an indicator of financial performance and is obtained by adding to net profit or loss, finance income and costs, depreciation and amortization, income taxes, share-based compensation from stock options, and certain write-downs (or related reversals) of inventories. "Adjusted EBITDA" excludes the effects of items that primarily reflect the impact of long-term investment and financing decisions rather than the results of day-to-day operations. The Corporation believes that this measure can be a useful indicator of its operational performance from one period to another. The Corporation uses this non-IFRS measure to make financial, strategic and operating decisions. Adjusted EBITDA is not a standardized financial measure under the financial reporting framework used to prepare the financial statements of the Corporation to which the measure relates and might not be comparable to similar financial measures disclosed by other issuers. The Corporation has reinstated its use of Adjusted EBITDA starting this quarter and has included Adjusted EBITDA for the comparative period. A quantitative reconciliation of the Adjusted EBITDA is presented in the table below:

Reconciliation of Adjusted EBITDA
(In thousands of U.S. dollars)

Three-month periods ended February Years ended November 30
29, 2024 28, 2023 2023 2022
Net loss (4,481 ) (10,443 ) (23,957 ) (47,237 )
Add :
Depreciation and amortization3 517 939 3,315 12,471
Net Finance costs4 2,125 4,940 12,909 6,886
Income taxes 110 96 421 443
Restructuring costs 18 - 2,215 3,872
Inventory provision 837 - 220 1,477
Share-based compensation 627 576 1,963 -
Adjusted EBITDA (247 ) (3,892 ) (2,914 ) (22,088 )

Conference Call Details

The call will be held on Wednesday, April 10 at 8:30 a.m. ET and will be hosted by Paul Lévesque, President and Chief Executive Officer. Mr. Lévesque will be joined by other members of the management team, including Philippe Dubuc, Senior Vice President and Chief Financial Officer, Christian Marsolais, Ph.D., Senior Vice President and Chief Medical Officer and John Leasure, Global Commercial Officer who will be available to answer questions from participants following prepared remarks.

Participants are encouraged to join the call at least ten minutes in advance to secure access. Conference call dial-in and replay information can be found below.

CONFERENCE CALL INFORMATION
Conference Call Date April 10, 2024
Conference Call Time 8:30 a.m. ET
Webcast link View Source
Dial in 1-888-513-4119 (toll free) or 1-412-902-6615 (international)
Access Code 4991919
CONFERENCE CALL REPLAY
Toll Free 1-877-344-7529 (US) / 1-855-669-9658 (Canada)
International Toll 1-412-317-0088
Replay Access Code 3783831
Replay End Date April 17, 2024
To access the replay using an international dial-in number, please select this link: View Source

An archived webcast will also be available on the Company’s Investor Relations website under ‘Past Events’.

On April 10, 2024 Tallac Therapeutics, Inc., a privately held clinical stage biopharmaceutical company pioneering the discovery and development of novel antibody-oligonucleotide conjugates, reported the presentation of preclinical data demonstrating TAC-001 potentiates cancer vaccine efficacy and rejuvenates vaccine responses (Press release, Tallac Therapeutics, APR 10, 2024, View Source [SID1234641989]). TAC-001 is an investigational, systemically delivered, Toll-like Receptor Agonist Antibody Conjugate (TRAAC) molecule, designed to selectively activate B cells to drive an anti-tumor immune response. The data will be presented today as part of the Vaccines, Antigens, and Antigen Presentation 2 session at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) 2024 Annual Meeting taking place in San Diego, April 5-10, 2024.

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The findings presented in the poster "A B cell targeted TLR9 Agonist Antibody Conjugate Potentiates Cancer Vaccine Efficacy and Rejuvenates Vaccine Responses in the Elderly" demonstrate that in combination with cancer vaccines, TAC-001 promotes robust and durable vaccine specific IgG titers, skews humoral response to Th1 phenotype, and rejuvenates vaccine responses. Moreover, TAC-001 enhances vaccine specific T cell activation and cytotoxic activity. As a result, anti-tumor vaccine efficacy is greatly improved by the combination with TAC-001. "The emerging data on TAC-001 in combination with cancer vaccines enhances our understanding of TAC-001 mechanisms in eliciting humoral and cellular anti-tumor immunity and provide a compelling rationale for combining TAC-001 with cancer vaccines in the clinic. This preclinical proof of concept expands the prospective therapeutic application of TAC-001 in oncology and other disease indications" said Dr. Hong I. Wan, president, CEO, and co-founder of Tallac Therapeutics.

AACR Poster Presentation Details:

Title: "A B cell targeted TLR9 Agonist Antibody Conjugate Potentiates Cancer Vaccine Efficacy and Rejuvenates Vaccine Responses in the Elderly."
Session Type: Poster Session
Session Category: Immunology
Session Title: Vaccines, Antigens, and Antigen Presentation 2
Abstract Number: 6746
Section 4, April 10, 9:00AM-12:30PM
About TAC-001 (CD22 TRAAC)

TAC-001 is a Toll-like Receptor Agonist Antibody Conjugate (TRAAC) comprised of a potent toll-like receptor 9 agonist (T-CpG) conjugated to an antibody against CD22, a receptor restricted to B cells, including tumor-infiltrating B cells. TAC-001 is designed to systemically deliver T-CpG to B cells by binding to CD22, leading to internalization of TAC-001, TLR9 signaling, B cell activation and a cascade of immune reactions. Preclinical studies demonstrate that the innate and adaptive immune responses triggered by TAC-001 lead to potent anti-tumor activity. TAC-001 is being developed for the treatment of solid tumors and is currently in a Phase 1/2 Study in cancer patients (NCT05399654). Emerging clinical data demonstrating tolerability, pharmacodynamic activity and preliminary clinical activity of single agent TAC-001 were observed (SITC 2023).