On February 23, 2023 Arvinas, Inc. (Nasdaq: ARVN), a clinical-stage biotechnology 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, 2022 and provided a corporate update (Press release, Arvinas, FEB 23, 2023, View Source [SID1234627597]).
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"2022 was an exciting year for Arvinas as we transitioned into a late-stage development organization and laid the foundation for an important year of data readouts and trial initiations in 2023," said John Houston, Ph.D., president and chief executive officer at Arvinas. "Notably, the initiation of our Phase 3 monotherapy trial with ARV-471 in ER+/HER2- metastatic breast cancer marks our first registrational study and if successful, will lead to our first commercial product bringing an important new treatment option to patients. We are on-track to initiate our second and third Phase 3 trials – one in the first line setting with ARV-471 and one with bavdegalutamide in metastatic castrate resistant prostate cancer – in the second half of this year, further validating our novel PROTAC discovery engine platform."
Recent Developments and 4Q Business Highlights
Gained alignment with FDA on an approach to the planned 1L Phase 3 trial with ARV-471 in combination with palbociclib to enable trial initiation in 2H 2023
The approach includes a Phase 3 lead-in to evaluate the optimal dose of palbociclib (100 mg or 75 mg) in combination with 200 mg ARV-471
The approach follows the recent analysis of data from the ongoing Phase 1b combination study of ARV-471 with palbociclib, in which an increase in palbociclib exposure was observed relative to historical palbociclib pharmacokinetic data
Initiated the VERITAC-2 Phase 3 2L+ clinical trial of ARV-471 as a monotherapy for the treatment of patients with ER+/HER2- metastatic breast cancer
Presented results from the Phase 2 cohort expansion portion (VERITAC) of a Phase 1/2 study with ARV-471 for the treatment of ER+/HER2- metastatic breast cancer
Initiated two arms of a Phase 1b umbrella trial with ARV-471; one in combination with ribociclib and another with abemaciclib (TACTIVE-U)
Initiated a Phase 2 trial with ARV-471 as a monotherapy in the neoadjuvant setting (TACTIVE-N)
Presented new preclinical neuroscience data at Society for Neuroscience’s "Neuroscience 2022" meeting demonstrating cross-species oral bioavailability and biodistribution into deep brain regions of nonhuman primates
Disclosed a BCL6 (B-cell lymphoma 6) PROTAC degrader in oncology and a LRRK2 (leucine-rich repeat kinase 2) PROTAC degrader in neuroscience as the Company’s next IND or CTA submissions
Appointed Everett Cunningham to the Company’s Board of Directors
Anticipated Upcoming Milestones and Expectations
ARV-471
With Pfizer, the companies plan to:
Initiate a Phase 3 trial with ARV-471 + palbociclib as a first-line treatment in patients with ER+/HER2- locally advanced or metastatic breast cancer (2H 2023)
Initiate additional arms of the Phase 1b combination umbrella trial (TACTIVE-U) with other targeted therapies (2023)
Provide an update with preliminary data from the Phase 1b combination trial with palbociclib (1H 2023)
Submit and present data from the Phase 1b combination trial with palbociclib at a medical congress (2H 2023)
AR Franchise (Bavdegalutamide/ARV-110, ARV-766)
Initiate a global Phase 3 trial with confirmed bavdegalutamide dose in metastatic castration-resistant prostate cancer (mCRPC) for patients with AR T878/H875 tumor mutations (2H 2023)
Complete enrollment in the Phase 1b combination study with bavdegalutamide plus abiraterone (2H 2023)
Share Phase 1 dose escalation trial data with ARV-766 in mCRPC (2Q 2023)
Initiate a Phase 1b or Phase 2 trial in patients who have not previously received novel hormonal agents (2H 2023)
Pipeline:
Submit two investigational new drug (IND)/clinical trial authorization (CTA) applications for the Company’s BCL6 (oncology) and LRRK2 (neuroscience) PROTAC protein degraders by year-end 2023
Progress at least two additional PROTAC protein degrader programs into IND- or CTA-enabling studies by year-end 2023
Financial Guidance
Based on its current operating plan, Arvinas believes its cash, cash equivalents, restricted cash and marketable securities as of December 31, 2022, is sufficient to fund planned operating expenses and capital expenditure requirements into 2026.
Full Year and Fourth Quarter Financial Results
Cash, Cash Equivalents, Restricted Cash and Marketable Securities Position: As of December 31, 2022, cash, cash equivalents, restricted cash and marketable securities were $1,210.8 million, as compared with $1,507.1 million as of December 31, 2021. The decrease in cash, cash equivalents, restricted cash and marketable securities of $296.3 million for the year was primarily related to cash used in operations of $279.2 million (net of $6.5 million received from two collaborators), unrealized loss on marketable securities of $14.6 million, loss on the sales of securities of $0.4 million and the purchase of lab equipment and leasehold improvements of $6.8 million, partially offset by proceeds from the exercise of stock options of $4.7 million.
Research and Development Expenses: Research and development expenses were $315.0 million and $98.3 million for the year and quarter ended December 31, 2022, as compared with $180.4 million and $61.8 million for the year and quarter ended December 31, 2021. The increase in research and development expenses of $134.6 million for the year was primarily due to an increase in expenses associated with our platform and exploratory programs of $77.7 million, our AR program (which includes bavdegalutamide (ARV-110) and ARV-766) of $15.7 million and our ER program of $41.2 million, which is net of the cost sharing of ARV-471 under the global Pfizer collaboration agreement to develop and commercialize ARV-471 that was initiated in July 2021 (ARV-471 Collaboration Agreement). The increase in research and development expenses of $36.5 million for the quarter was primarily due to an increase in expenses associated with our platform and exploratory programs of $24.9 million, our AR program of $5.5 million and our ER program of $6.0 million.
General and Administrative Expenses: General and administrative expenses were $79.6 million and $15.1 million for the year and quarter ended December 31, 2022, as compared with $61.6 million and $18.9 million for the year and quarter ended December 31, 2021. The increase in general and administrative expenses of $18.0 million for the year was primarily due to an increase of personnel related costs of $15.0 million and professional fees of $5.6 million. The decrease in general and administrative expenses of $3.8 million for the quarter was primarily due to a decrease in facility costs attributable to our general and administrative functions.
Revenue: Revenue was $131.4 million and $38.0 million for the year and quarter ended December 31, 2022 as compared with $53.6 million and $28.7 million for the year and quarter ended December 31, 2021. Revenue is related to the ARV-471 Collaboration Agreement with Pfizer that was initiated in July 2021, 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, the amended and restated option, license and collaboration agreement with Genentech that was initiated in November 2017 and revenue related to our Oerth Bio joint venture which was initiated in July 2019. The increase in revenues of $77.8 million and $9.3 million for the year and quarter was primarily due to revenues from the ARV-471 Collaboration Agreement with Pfizer.
Income Tax Expense: Income tax expense was $20.9 million and $10.8 million for the year and quarter ended December 31, 2022, as compared with zero for the year and quarter ended December 31, 2021 due to taxable income projected for fiscal year 2022 primarily related to revenue recognized in 2022 for tax purposes from the ARV-471 Collaboration Agreement.
Loss from Equity Method Investment: Loss from equity method investment totaled $10.6 million and $3.0 million for the year and quarter ended December 31, 2022, compared with $6.9 million and $2.3 million for the year and quarter ended December 31, 2021 due to increased operating losses incurred by Oerth Bio.
Net Loss: Net loss was $282.5 million and $82.9 million for the year and quarter ended December 31, 2022, as compared with $191.0 million and $52.9 million for the year and quarter ended December 31, 2021. The increase in net loss for the year and quarter was primarily due to increased research and development expenses, general and administrative expenses and losses from equity investment, partially offset by increased revenue.
About bavdegalutamide (ARV-110)
Bavdegalutamide (ARV-110) is an investigational orally bioavailable PROTAC protein degrader designed to selectively target and degrade the androgen receptor (AR). Bavdegalutamide is being developed as a potential treatment for men with metastatic castration-resistant prostate cancer.
Bavdegalutamide 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. In July 2021, Arvinas announced a global collaboration with Pfizer for the co-development and co-commercialization of ARV-471; Arvinas and Pfizer will equally share worldwide development costs, commercialization expenses, and profits.
About ARV-766
ARV-766 is an investigational orally bioavailable PROTAC protein degrader designed to selectively target and degrade AR. In preclinical studies, ARV-766 degraded all resistance-driving point mutations of AR, including L702H, a mutation associated with treatment with abiraterone and other AR-pathway therapies.
ARV-766 is being developed as a potential treatment for men with metastatic castration-resistant prostate cancer, and ARV-766 may also have applicability in other AR-driven diseases both in and outside oncology. ARV-766 has demonstrated activity in preclinical models of resistance to currently available AR-targeted therapies.