On March 21, 2024 Exscientia plc (Nasdaq: EXAI) reported recent advancements in the Company’s pipeline, collaborations and operations, as well as financial results for the fourth quarter and full year 2023, are summarised below (Press release, Exscientia, MAR 21, 2024, View Source [SID1234641325]). Exscientia will host a conference call Thursday, March 21 at 12:30 p.m. GMT / 8:30 a.m. EDT.

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"In 2023, we significantly expanded our technological capabilities with the opening of our automation facility, concentrated our internal research on high value oncology targets and steadily progressed multiple new and existing programmes with our large pharma partners," said Dr. David Hallett, interim Chief Executive Officer and Chief Scientific Officer of Exscientia. "In 2024 we will continue to advance our pipeline programmes through clinical development. This includes GTAEXS617 (‘617), our CDK7 inhibitor currently in a Phase 1/2 clinical trial; LSD1, for which we anticipate initiating a Phase 1 patient study this year; and MALT1, which continues to progress through IND-enabling studies. In addition, we look forward to advancing our partnered programmes through potential milestones, while simultaneously inking new partnerships and expanding our technological capabilities to further cement our leadership in AI-powered drug design and development."

Key Business Highlights

Pipeline

•Patient enrolment is continuing to progress for the dose escalation phase of ELUCIDATE, the adaptive Phase 1/2 trial studying ‘617, a potential best-in-class CDK7 inhibitor, for the treatment of advanced solid tumours. The Company expects to announce a transition from the dose escalation to dose expansion phase in the second half of 2024
•EXS74539 (‘539), a highly differentiated LSD1 inhibitor, is continuing through IND/CTA enabling studies, and the Company anticipates initiating a Phase 1 clinical trial in cancer patients in 2024. ‘539 was precision designed by Exscientia to optimise the therapeutic window by combining reversible binding, brain penetration and a short half-life
•EXS4318 (‘4318), a PKC-theta inhibitor designed by Exscientia and in-licensed by Bristol Myers Squibb for immunology and inflammation indications, is continuing to advance in a Phase 1 study. Exscientia retains rights to receive milestone payments and potential royalties for ‘4318
•EXS73565 (‘565), the Company’s differentiated MALT1 inhibitor, precision designed with selectivity over UGT1A1, is also advancing through IND/CTA-enabling studies. The Company expects to provide further updates in 1H 2024

Collaborations & Partnerships

•In December 2023, the Company announced the addition of an existing Exscientia programme to its Sanofi collaboration
◦Preliminary data shows these compounds have good potency and selectivity towards the target and differentiated molecular properties
◦The addition of this discovery stage programme, identified and initially advanced by Exscientia, includes financial milestones over and above programmes initiated as part of the collaboration agreement
◦Exscientia received a $4 million in upfront payment in the first quarter of 2024 for this programme. The Company is eligible to receive up to an additional $41 million in preclinical milestone payments, as well as over $300 million in further milestone payments if the programme achieves all milestones under the agreement
◦Exscientia is also eligible to receive tiered royalties on sales of products that may be developed from this programme
•In October 2023, Exscientia also announced the achievement of the first discovery stage milestone from a different programme within the Sanofi collaboration
•Exscientia’s collaboration with Merck KGaA, Darmstadt, Germany, initially announced in September 2023, is ongoing, leveraging Exscientia’s precision design capabilities to design and discover novel small molecule drug candidates across oncology and immunology
•In December 2023, Exscientia announced that it had received a $2.3 million grant from Open Philanthropy to drive research on the host-interferon response as a pathway to treating and preventing pandemic influenza
◦Focus aligns with Exscientia’s ongoing commitment to pandemic preparedness, initiated with support from the Bill & Melinda Gates Foundation in 2021

•DSP-2342, a dual 5-HT2A/5-HT7 antagonist designed by Exscientia for Sumitomo Pharma for the treatment of psychiatric diseases, entered Phase I studies in April 2023
•DSP-2342 is the third compound designed by Exscientia that Sumitomo Pharma has advanced into the clinic

Platform

•Exscientia opened its novel automated discovery laboratory in mid-2023. This facility has the capability to integrate AI design methods with chemical synthesis and biological testing. This integration has the potential to bring significant further efficiencies to the drug design process and enhance the rate of learning of Exscientia’s generative design platform
•Exscientia continues to drive the development of its functional precision medicine platform with new studies and collaborations
◦In January 2024, Exscientia launched EXCYTE-2, a multi-centre observational study to evaluate the precision medicine platform in patients with acute myeloid leukaemia. This study has the potential to support the ongoing development of ‘539, Exscientia’s LSD1 inhibitor
◦In July 2023, Exscientia launched EXCYTE-1, a first-of-its-kind prospective observational study in ovarian cancer. This ongoing trial is the first trial evaluating the potential of Exscientia’s functional precision medicine platform in a solid tumour indication
◦The collaboration with Charité – Universitätsmedizin Berlin, announced in March 2023, evaluating Exscientia’s precision medicine platform as a tool to predict response in haematological cancers is also ongoing. This collaboration highlights the scalability of the primary patient tissue platform as Charité will be able to utilise cloud-based AI to analyse samples imaged onsite
•In the fourth quarter of 2023, Exscientia deployed large language models (LLMs) internally for the use of target hypothesis generation. These LLMs, based on both public and proprietary datasets, have been integrated with the Company’s existing target identification infrastructure with the aim to further enhance the productivity of Exscientia’s discovery platform

Investor Call and Webcast Information

Exscientia will host a conference call on Thursday, March 21 at 12:30 p.m. GMT / 8:30 a.m. EDT.
A webcast of the live call can be accessed by visiting the "Investors and Media" section of the Company’s website at investors.exscientia.ai. Alternatively, the live conference call can be accessed by dialling +1 (888) 596 4144 (U.S.), +44 800 358 0970 (U.K.), +1 (646) 968 2525 (International) and entering the conference ID: 8333895. A replay will be available for 90 days under "Events and Presentations" in the "Investors and Media" section of the Exscientia website.

Fourth Quarter and Full Year 2023 Financial Results

For the convenience of the reader, the Company has translated pound sterling amounts to U.S. dollars at the rate of £1.000 to $1.2743, which was the noon buying rate of the Federal Reserve Bank of New York on December 29, 2023.

Revenue: Revenue for the three and twelve months ended December 31, 2023 was $3.1 million and $25.6 million respectively, compared to $8.7 million and $34.7 million for the three and twelve months ended December 31, 2022. The decrease in revenue quarter on quarter and year on year is primarily the result of multiple new programmes starting with partners in the second half of 2023 with revenue recognition constrained by the early nature of these programmes, as well as pipeline prioritisation activities.

Research and development expenses: R&D expenses for the three and twelve months ended December 31, 2023 were $37.5 million and $163.7 million respectively, as compared to $45.4 million and $164.2 million for the same period ended December 31, 2022. The current quarter over quarter decrease in research and development expenses was primarily due to pipeline prioritisation activities and cost efficiency savings, including achieving faster cycle times and lower outsourcing costs.

General and administrative expenses: G&A expenses for the three and twelve months ended December 31, 2023, were $14.8 million, or 24.7% of total operating expenses, and $57.8 million, or 22.5% of total operating expenses respectively. For the three and twelve months ended December 31, 2022, G&A expenses increased by $4.3 million and $8.8 million compared to the three and twelve months ended December 31, 2022, primarily associated with increased personnel expenses.

Cash inflows: For the full year 2023, Exscientia received $27.4 million in cash inflows from its collaborations as compared to $117.8 million during the full year 2022, when the upfront payment for the Sanofi collaboration was received.

Net operating cash flow and cash balance: For the full year ending December 31, 2023, net operating cash outflows were $149.9 million, in comparison to $77.1 million for the full year 2022. Cash, cash equivalents and short term bank deposits as of December 31, 2023 were $462.6 million, as compared to $644.6 million as of December 31, 2022 using the December 29, 2023 constant currency rate.

Based on our current operating plans, the Company believes that its existing cash, cash equivalents and short-term bank deposits and anticipated milestones will be sufficient to fund its operations and capital expenditure requirements well into 2026.