On August 2, 2018 Evelo Biosciences, Inc. (Nasdaq:EVLO) (Evelo), a clinical stage biotechnology company developing monoclonal microbials designed to act on the gut-body network for the treatment of a wide range of diseases, reported financial results and provided a business update for the second quarter ended June 30, 2018 (Press release, Evelo Biosciences, AUG 2, 2018, View Source [SID1234528391]).
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"Our recent accomplishments represent important progress across our business, as we entered the clinic with our first monoclonal microbial, EDP1066, and continued to advance our broad portfolio of preclinical product candidates in a range of inflammatory and oncology indications," said Simba Gill, Ph.D., President and Chief Executive Officer of Evelo. "Looking to the second half of 2018, we are focused on advancing EDP1815 and EDP1503 into their first clinical trials in inflammatory disease and oncology, respectively, as we seek to advance our diversified portfolio of monoclonal microbials toward ten potential clinical readouts between 2019 and 2020 across different diseases and underlying biologies. We are also committed to further understanding of the gut-body network more broadly, as highlighted by our recently-signed research collaboration with world-leaders at Harvard University, which will enable us to further explore the gut’s role in modulating immune activity throughout the body."
Second Quarter and Recent Business Highlights:
Pipeline:
In May 2018, the U.S. Food and Drug Administration accepted an Investigational New Drug application to begin a 70-patient open-label Phase 2 clinical trial of EDP1503, a monoclonal microbial for the treatment of cancer. The University of Chicago will conduct this investigator-sponsored open-label clinical trial, which is designed to evaluate the safety, tolerability, and efficacy of EDP1503 in combination with a checkpoint inhibitor in patients with metastatic melanoma.
In April 2018, Evelo dosed the first subject in its 96-subject Phase 1 clinical trial of EDP1066, a monoclonal microbial for the treatment of inflammatory diseases. This clinical trial is designed to evaluate the safety and tolerability of a range of daily doses of EDP1066 in healthy volunteers and in patients with psoriasis and atopic dermatitis. Additional exploratory endpoints include the effect of EDP1066 on validated clinical measures of disease and on an integrated set of biomarkers.
Harvard University Research Collaboration:
In June 2018, Evelo entered into a research collaboration with scientists at Harvard University to study the gut-body network. Evelo will work with three of the world’s leading experts in immunology and microbiology at Harvard Medical School: Diane Mathis, Ph.D., the Morton Grove-Rasmussen Professor of Microbiology and Immunobiology, Christophe Benoist, M.D., Ph.D., the Morton Grove-Rasmussen Professor of Immunohematology, and Dennis Kasper, M.D., the William Ellery Channing Professor of Medicine and Professor of Microbiology and Immunobiology. The collaboration aims to further elucidate the mechanisms by which microbes acting on cells in the gut have the potential to treat disease elsewhere in the body. Under the multi-year agreement, Evelo has an exclusive option to license from Harvard intellectual property rights that may arise from this research collaboration.
Corporate:
In June 2018, Evelo was added to the Russell 3000, Russell 2000 and Russell Microcap Indexes as part of the Russell Investments’ annual reconstitution.
In May 2018, Evelo completed its initial public offering of common stock at $16.00 per share, raising $75.8 million in net proceeds after deducting underwriting discounts and commissions and other offering expenses.
Upcoming Anticipated Milestones:
Initiation of the University of Chicago’s investigator-sponsored, open-label Phase 2 clinical trial of EDP1503 in combination with a PD-1 inhibitor in patients with metastatic melanoma expected in the second half of 2018.
Initiation of a Phase 1 clinical trial of EDP1815, an anti-inflammatory monoclonal microbial product candidate, in patients with psoriasis and atopic dermatitis in the fourth quarter of 2018.
Initiation of a Phase 2 clinical trial of EDP1503 in combination with a checkpoint inhibitor in patients with multiple cancer types in the first half of 2019.
Initial clinical data from ongoing Phase 1 clinical trial of EDP1066 in patients with psoriasis and atopic dermatitis in the first half of 2019.
Second Quarter 2018 Financial Results:
Cash Position: As of June 30, 2018, cash and cash equivalents were $178.9 million, as compared to cash and cash equivalents of $38.2 million as of December 31, 2017. This increase was due to net proceeds of $81.3 million from the issuance of Series C Preferred Stock, net proceeds of $75.8 million from Evelo’s initial public offering and $5.0 million of additional drawings from Evelo’s existing debt facility, partially offset by cash used to fund operating activities for the first half of 2018. Evelo expects that its cash and cash equivalents will enable it to fund its planned operating expenses and capital expenditure requirements into the second half of 2020.
Research and Development Expenses: R&D expenses were $10.2 million for the three months ended June 30, 2018, compared to $4.7 million for the three months ended June 30, 2017. The increase of $5.5 million was due primarily to increases in costs related to Evelo’s inflammation and gut-body network platform expenses as well as increased personnel costs.
General and Administrative Expenses: G&A expenses were $5.1 million for the three months ended June 30, 2018, compared to $1.5 million for the three months ended June 30, 2017. The increase of $3.6 million was due primarily to increased general and administrative personnel costs, professional and consulting fees, and facility expenses supporting Evelo’s growing organization and public company infrastructure.
Net Loss Attributable to Common Stockholders: Net loss attributable to common stockholders was $16.7 million for the three months ended June 30, 2018, or $0.85 per basic and diluted share, as compared to a net loss attributable to common stockholders of $7.8 million for the three months ended June 30, 2017, or $2.09 per basic and diluted share.