On March 1, 2021 Arvinas, Inc. (Nasdaq: ARVN), a clinical-stage biopharmaceutical company creating a new class of drugs based on targeted protein degradation, reported financial results for the fourth quarter and full year ended December 31, 2020 and provided a corporate update (Press release, Arvinas, MAR 1, 2021, View Source [SID1234575838]).

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"2020 was a breakthrough year for Arvinas and for the patients we aim to serve, as we reported clear signals of efficacy in both of our clinical-stage programs. These data provided further validation that our approach to protein degradation could potentially change the lives of patients with few or no therapeutic options," said John Houston, Ph.D., Chief Executive Officer at Arvinas. "Despite the unprecedented circumstances of a pandemic, our clinical trials and preclinical research continued to deliver, and we enter 2021 well positioned to extend our success and progress our programs in oncology and neurodegeneration."

Business Highlights and Recent Developments

Presented interim Phase 1 data for ARV-471 showing potential for best-in-class safety and tolerability, estrogen receptor (ER) degradation greater than that previously reported for the current standard of care agent (fulvestrant), and a robust efficacy signal in heavily pretreated patients with locally advanced or metastatic ER positive / HER2 negative (ER+/HER2-) breast cancer
Presented data from the ongoing dose escalation portion of the Phase 1/2 trial of ARV-110 in men with metastatic castration-resistant prostate cancer (mCRPC), providing additional evidence of anti-tumor activity and patient benefit, including a prostate specific antigen reduction ≥50% (PSA50) in 2 of 5 (40%) in a molecularly defined patient population
Closed an underwritten public offering of 6,571,428 shares of common stock at a public offering price of $70.00 per share, including the exercise in full by the underwriters of their option to purchase additional shares of common stock. Arvinas received net proceeds of $431.9 million, after deducting underwriting discounts and commissions and offering expenses
Initiated the ARDENT Phase 2 dose expansion study of ARV-110 (Dose: 420 mg daily)
Initiated the VERITAC Phase 2 dose expansion study of ARV-471 (Dose: 200 mg daily)
Initiated a Phase 1b trial of ARV-471 in combination with Ibrance (palbociclib)
Anticipated Milestones and Expectations

ARV-471

Completion of the Phase 1 dose escalation (1H21)
Presentation of completed Phase 1 dose escalation data (2H21)
Announcement of safety data from the Phase 1b trial in combination with Ibrance (palbociclib) (2H21)
Initiation of a window of opportunity study in adjuvant breast cancer (2H21)
Initiation of a combination trial of ARV-471 and another targeted therapy in 2L/3L metastatic breast cancer (2H21)
ARV-110

Completion of the Phase 1 dose escalation (1H21)
Presentation of completed Phase 1 dose escalation data (2H21)
Announcement of interim data from the ARDENT Phase 2 dose expansion at 420 mg (2H21)
Initiation of combination trial(s) with standards-of-care (2021)
Other Clinical Milestones

Initiation of first-in-human study of ARV-766, an androgen receptor (AR) degrader with a differentiated profile from ARV-110, in patients with metastatic castration-resistant prostate cancer (1H21)
Financial Guidance

Based on its current operating plan, Arvinas expects its cash, cash equivalents, and marketable securities will be sufficient to fund its planned operating expenses and capital expenditures into 2024.

Full Year and Fourth Quarter Financial Results

Cash, Cash Equivalents and Marketable Securities Position: As of December 31, 2020, cash, cash equivalents and marketable securities were $688.5 million as compared with $280.9 million as of December 31, 2019. The increase primarily related to net proceeds from the issuance of common stock and proceeds from the exercise of stock options of $504.7 million, proceeds from two collaborators of $7.4 million, partially offset by cash used to fund operations of approximately $98.1 million and cash used to purchase fixed assets and leasehold improvements of $6.4 million.

Research and Development Expenses: Research and development expenses were $108.4 million and $33.2 million for the year and quarter ended December 31, 2020, respectively, as compared with $67.2 million and $20.4 million for the year and quarter ended December 31, 2019, respectively. The increase in research and development expenses for the year of $41.2 million primarily related to Arvinas’ continued investment in its wholly owned platform, exploratory and lead optimization programs of $17.6 million, its androgen receptor (AR) program of $12.3 million and estrogen receptor program (ER) of $11.3 million. The increase in research and development expense for the quarter of $12.8 million primarily related to Arvinas’ continued investment in its wholly owned platform, exploratory and lead optimization programs of $5.1 million, its AR program of $4.8 million and ER program of $2.9 million.

General and Administrative Expenses: General and administrative expenses were $38.3 million and $12.2 million for the year and quarter ended December 31, 2020, respectively, as compared with $27.3 million and $7.3 million for the year and quarter ended December 31, 2019, respectively. The increase in general and administrative expenses for the year of $11.0 million related to an increase of $9.6 million in personnel and facility related costs, including $4.8 million related to stock compensation expense, and insurance, taxes and professional fees of $1.4 million. The increase in general and administrative expenses for the quarter of $5.0 million primarily related to an increase of $2.9 in personnel and facility cost, including $1.4 million related to stock compensation expense and $1.7 million of legal and other professional services.

Revenues: Revenues were $21.8 million and $2.2 million for the year and quarter ended December 31, 2020, respectively, as compared with $43.0 million and $4.9 million for the year and quarter ended December 31, 2019, respectively. Revenue for the year ended December 31, 2019 included $24.7 million of revenue recognized from the Arvinas contribution of the license to the joint venture between Bayer and Arvinas to pursue the PROTAC technology in agricultural applications (the Joint Venture). The remaining collaboration revenue of $18.3 million and revenue of $4.9 million for the year and quarter ended December 31, 2019, respectively, was generated from the license and rights to technology fees and research and development activities related to the collaboration and license agreement with Bayer that was initiated in July 2019, the collaboration and license agreement with Pfizer that was initiated in January 2018, and the amended and restated option, license and collaboration agreement with Genentech that was initiated in November 2017. The increase in collaboration revenue of $3.5 million for the year was primarily related to the Bayer agreement having only a partial year of revenue recognized in 2019 and an increase in activities related to the Pfizer agreement. The decrease in collaboration revenue of $2.7 million in the quarter primarily related to a collaborator adding new targets that extended the period of revenue recognition for the collaboration agreement.

Loss from Equity Method Investment: Loss from equity method investment for the year ended December 31, 2019 was $24.7 million, which related to the loss from the equity method investment in the Joint Venture. The loss was generated from the Joint Venture’s expensing the values associated with the contributed intellectual property from the Joint Venture partners.

Net Loss: Net loss was $119.3 million and $41.5 million for the year and quarter ended December 31, 2020, respectively, as compared with $70.3 million and $21.0 million for the year and quarter ended December 31, 2019, respectively. The increase in net loss for the year and quarter ended December 31, 2020 of $49.0 million and $20.5 million, respectively, primarily related to Arvinas’ continued investment in its platform, exploratory and lead optimization programs, its AR program, its ER program, and an increase in general and administrative infrastructure costs.

About ARV-110
ARV-110 is an investigational orally bioavailable PROTAC protein degrader designed to selectively target and degrade the androgen receptor (AR). ARV-110 is being developed as a potential treatment for men with metastatic castration-resistant prostate cancer.

ARV-110 has demonstrated activity in preclinical models of AR mutation or overexpression, both common mechanisms of resistance to currently available AR-targeted therapies.

About ARV-471
ARV-471 is an investigational orally bioavailable PROTAC protein degrader designed to specifically target and degrade the estrogen receptor (ER) for the treatment of patients with locally advanced or metastatic ER+/HER2- breast cancer.

In preclinical studies, ARV-471 demonstrated near-complete ER degradation in tumor cells, induced robust tumor shrinkage when dosed as a single agent in multiple ER-driven xenograft models, and showed superior anti-tumor activity when compared to a standard of care agent, fulvestrant, both as a single agent and in combination with a CDK4/6 inhibitor.