On March 29, 2023 Arcellx, Inc. (NASDAQ: ACLX), a biotechnology company reimagining cell therapy through the development of innovative immunotherapies for patients with cancer and other incurable diseases, reported business highlights and financial results for the fourth quarter and year ended December 31, 2022 (Press release, Arcellx, MAR 29, 2023, View Source [SID1234629577]).
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"2022 was a stellar year for Arcellx, both from a business and clinical perspective. We completed a successful IPO in February, secured additional capital through a follow-on offering in June, and ended the year announcing a global partnership with Kite to co-develop and co-commercialize CART-ddBCMA in multiple myeloma. In parallel, we initiated two Phase 1 studies utilizing our dosable and controllable CAR-T technology, ARC-SparX, and our Phase 2 iMMagine-1 pivotal study and presented robust long-term data from our Phase 1 expansion study of CART-ddBCMA in multiple myeloma at ASCO (Free ASCO Whitepaper) and ASH (Free ASH Whitepaper). We also made significant progress on the manufacturing front, setting us up for scalable manufacturing in the future," said Rami Elghandour, Arcellx’sChairman and Chief Executive Officer. "Leveraging our balance sheet of $580 million in cash positions us to continue building on our strong foundation as we advance our pipeline programs. Our team, in collaboration with our colleagues at Kite, remains focused on completing enrollment of iMMagine-1, initiating iMMagine-2 in earlier multiple myeloma lines, and presenting longer-term data from our Phase 1 expansion study of CART-ddBCMA. We’re also beginning commercial planning as we prepare for U.S. market entry with the goal of meeting the demand of the many patients in need."
Recent Business Highlights
Announced strategic collaboration with Kite, a Gilead Company, to co-develop and co-commercialize the company’s late-stage clinical CART-ddBCMA program in multiple myeloma. On December 9, 2022, Arcellx and Kite, a Gilead Company, announced a strategic collaboration to co-develop and co-commercialize Arcellx’s lead product candidate, CART-ddBCMA, for the treatment of patients with relapsed or refractory multiple myeloma (rrMM). The collaboration leverages expertise across both companies, including Kite’s global cell therapy leadership and industry-leading reliable manufacturing. Arcellx received an upfront payment of $225 million
and a $100 million equity investment. Kite and Arcellx will co-commercialize and split profits in the United States and Arcellx will receive low to mid-teen royalties outside the U.S.
Presented continued robust long-term responses from lead product candidate, CART-ddBCMA, being evaluated in a Phase 1 expansion trial in patients with relapsed or refractory multiple myeloma at the 64th ASH (Free ASH Whitepaper) Annual Meeting and Exposition and provided additional pipeline progress. On December 11, 2022, Arcellx presented new clinical data from its ongoing Phase 1 expansion study of its novel, autologous CART-ddBCMA therapy, for the treatment of patients with rrMM during a presentation at the 64th ASH (Free ASH Whitepaper) Annual Meeting and Exposition. The data demonstrated 100% ORR and deep and durable responses were observed in patients with poor prognostic factors. Overall, 27 of 38 (71%) evaluable patients reached CR/sCR and 20 of 25 patients (80%) dosed >12 months ago or had their 12-month follow-up visit by November 22, 2022, had reached CR/sCR. Additionally, CART-ddBCMA continued to be well tolerated with no delayed neurotoxicity or parkinsonian-like events reported. Arcellx also announced that it had dosed patients in its pivotal iMMagine-1 Phase 2 clinical trial and that it had initiated its Phase 1 clinical trial of ACLX-002 for the treatment of patients with AML/MDS.
Fourth Quarter and Full Year 2022 Financial Highlights
Cash, cash equivalents, and marketable securities:
As of December 31, 2022, Arcellx had cash, cash equivalents, and marketable securities of $254.8 million. In January 2023, Arcellx and Kite closed its agreement to co-develop and co-commercialize Arcellx’s late-stage clinical program CART-ddBCMA in multiple myeloma. Upon closing the agreement, Arcellx received a $225 million upfront payment from Kite and a $100 million equity investment from Gilead. Arcellx expects that the cash on hand, subsequent to the closing, will fund its operations through BLA filing of CART-ddBCMA planned for the first half of 2025.
R&D expenses:
Research and development expenses were $25.9 million for the quarter ended December 31, 2022, compared to $13.4 million for the quarter ended December 31, 2021, an increase of $12.5 million. Research and development expenses were $149.6 million for the year ended December 31, 2022, compared to $46.9 million for the year ended December 31, 2021, an increase of $102.7 million. This increase for the year was primarily driven by the accounting for an expense of $63.3 million related to manufacturing services agreements. In accordance with ASC 842, the Company was required to expense the related right of use asset associated with an embedded lease which was determined to have no alternative future use. Other increases were related to higher external costs associated with the advancement of the company’s CART-ddBCMA clinical program, other pipeline candidates, and increased headcount.
G&A expenses:
General and administrative expenses were $14.1 million for the quarter ended December 31, 2022, compared to $7.3 million for the quarter ended December 31, 2022, an increase of $6.8 million. General and administrative expenses were $41.7 million for the year ended December 31, 2022, compared to $18.1 million for the year ended December 31, 2021, an increase of $23.6 million. These increases were driven by increased headcount and professional services costs such as legal, audit services, and consultants.
Net loss:
Net loss was $39.0 million and $20.7 million for the quarters ended December 31, 2022, and 2021, respectively; and $188.7 million and $65.0 million for the years ended December 31, 2022, and 2021, respectively.