Fate Therapeutics Reports First Quarter 2017 Financial Results
May 15 2017 - 04:01PM
ProTmune™ PROTECT Safety Data Expected in
Mid-2017
Fate Therapeutics, Inc. (NASDAQ:FATE), a clinical-stage
biopharmaceutical company dedicated to the development of
programmed cellular immunotherapies for cancer and immune
disorders, today reported business highlights and financial results
for the quarter ended March 31, 2017.
“This has been an exciting quarter for us as we have
successfully launched our multi-pronged clinical development
strategy for FATE-NK100 across both hematologic and solid tumor
malignancies. We also continue to be encouraged by investigator
enthusiasm for ProTmune and look forward to sharing key clinical
data in mid-2017 from the safety stage of our PROTECT study,” said
Scott Wolchko, President and Chief Executive Officer of Fate
Therapeutics. “Additionally, we are very pleased with the
constructive feedback we received from regulatory authorities in
both the United States and the United Kingdom regarding our
specific manufacturing and development plans for our first-of-kind
cell products derived from master pluripotent cell lines. These
formal meetings confirmed our alignment with key regulatory
agencies in bringing our off-the-shelf iPSC-derived cell products
into human clinical trials.”
Recent Highlights & Program
Updates
- Launched First-in-Human Clinical Trial of
FATE-NK100. An investigator-initiated clinical trial of
FATE-NK100, the Company’s first-in-class adaptive memory natural
killer (NK) cell product candidate, was opened for patient
enrollment at the Masonic Cancer Center, University of Minnesota
(UMN) for the treatment of refractory or relapsed acute myelogenous
leukemia. The VOYAGE study is utilizing accelerated dose-escalation
to evaluate the safety and determine the maximum dose of a single
intravenous infusion of FATE-NK100. The anti-tumor activity of
FATE-NK100, including rates of complete response, clearance of
minimal residual disease, disease-free survival and overall
survival, will also be assessed.
- Secured FDA Clearance of IND for FATE-NK100 in Advanced
Solid Tumors. In May 2017, the U.S. Food and Drug
Administration (FDA) cleared the Company’s investigational new drug
(IND) application for the clinical investigation of FATE-NK100,
including in combination with monoclonal antibody therapy, in
subjects with advanced solid tumor malignancies. The Company plans
to enroll subjects in the DIMENSION study concurrently across three
FATE-NK100 treatment arms: as monotherapy for solid tumor
malignancies, including small cell lung cancer and hepatocellular
carcinoma; in combination with trastuzumab for advanced HER2+
cancers, including breast and gastric cancers; and in combination
with cetuximab for advanced EGFR1+ cancers, including colorectal
and head and neck cancers. Accelerated dose-escalation will be
utilized to evaluate the safety and anti-tumor activity of FATE
NK100 in an outpatient setting.
- Conducted Formal Regulatory Engagements with FDA and
MHRA for hnCD16-iNK Cell Product Candidate. Fate
Therapeutics held a Pre-IND meeting with the FDA and a Scientific
Advice meeting with the UK Medicines and Healthcare products
Regulatory Agency (MHRA) in March and April 2017, respectively, to
support the clinical translation of its induced pluripotent stem
cell (iPSC)-derived NK cell products. These formal meetings
reviewed the Company’s preclinical development, proposed
manufacturing plans and clinical trial design for its first-of-kind
NK cell product candidate, an off-the-shelf targeted cancer
immunotherapy derived from an engineered iPSC line. Based on these
interactions, the Company expects to file applications with both
regulatory authorities within the next twelve months to conduct a
first-in-human clinical trial for the treatment of cancer. In
February 2017, Fate Therapeutics and UMN expanded their
collaboration to initiate clinical translation of the Company’s
iPSC-derived NK cell products, including its off-the-shelf targeted
hnCD16-iNK cell product candidate derived from a master iPSC line
engineered to express a proprietary high-affinity, non-cleavable
CD16 receptor (hnCD16).
- Granted Foundational iPSC Manufacturing
Patent. In March 2017, the U.S. Patent and Trademark
Office issued U.S. Patent No. 9,593,311 which protects cellular
compositions comprising iPSCs and a WNT pathway activator, such as
a GSK3 inhibitor. This latest issuance, which expires in 2029,
continues to extend the Company’s dominant U.S. patent position
covering OCT4-based cell reprogramming, including gene expression
vectors and cell compositions necessary for generating iPSCs. The
newly-patented compositions are critical for selecting and
expanding iPSC clones and for maintaining clonal populations in a
state of pluripotency, both of which are required to create master
pluripotent cell lines for the manufacture of homogeneous cell
products. The patent, which is owned by the Whitehead Institute for
Biomedical Research and licensed exclusively to the Company for all
therapeutic purposes, adds to the Company’s significant iPSC
intellectual property portfolio of over 90 issued patents and 100
pending patent applications.
First Quarter 2017 Financial
Results
- Cash & Short-term Investment Position:
Cash, cash equivalents and short-term investments as of March 31,
2017 were $82.3 million compared to $92.1 million as of December
31, 2016. The decrease was primarily driven by the Company’s use of
cash to fund operating activities and to service principal and
interest obligations under its loan agreement with Silicon Valley
Bank.
- Total Revenue: Revenue was $1.0 million for
the first quarter of 2017 compared to $1.3 million for the
comparable period in 2016. All revenue was derived from the
Company’s research collaboration and license agreement with Juno
Therapeutics.
- Total Operating Expenses: Total operating
expenses were $11.0 million for the first quarter of 2017 compared
to $9.2 million for the comparable period in 2016. Operating
expenses for the first quarter of 2017 included $0.9 million of
stock compensation expense, compared to $0.8 million for the
comparable period in 2016.
- R&D Expenses: Research and development
expenses were $8.0 million for the first quarter of 2017 compared
to $6.6 million for the comparable period in 2016. The increase in
R&D expenses was primarily related to an increase in
third-party service provider fees to support the clinical
development of ProTmune and FATE-NK100 and the preclinical
advancement of the Company’s off-the-shelf iPSC-derived cellular
immunotherapy programs.
- G&A Expenses: General and administrative
expenses were $3.0 million for the first quarter of 2017 compared
to $2.6 million for the comparable period in 2016. The increase in
G&A expenses was primarily related to an increase in
intellectual property-related expenses.
- Shares Outstanding: Common shares outstanding
as of March 31, 2017 and December 31, 2016 were 41.4 million.
Preferred shares outstanding as of March 31, 2017 and December 31,
2016 were 2.82 million, each of which is convertible into five
shares of common stock. All preferred shares outstanding relate to
the Company’s sale and issuance of 2.82 million shares of
non-voting Class A convertible preferred stock to Redmile Group,
LLC in November 2016.
Today's Conference Call and Webcast
The Company will conduct a conference call today,
Monday, May 15, 2017 at 5:00 p.m. ET to review financial and
operating results for the quarter ended March 31, 2017. In order to
participate in the conference call, please dial 877-303-6235
(domestic) or 631-291-4837 (international) and refer to conference
ID 18632775. The live webcast can be accessed under "Events &
Presentations" in the Investors & Media section of the
Company's website at www.fatetherapeutics.com. The archived webcast
will be available on the Company's website beginning approximately
two hours after the event.
About Fate Therapeutics, Inc.
Fate Therapeutics is a clinical-stage
biopharmaceutical company dedicated to the development of
programmed cellular immunotherapies for cancer and immune
disorders. The Company’s hematopoietic cell therapy pipeline is
comprised of NK- and T-cell immuno-oncology programs, including
off-the-shelf product candidates derived from engineered induced
pluripotent cells, and immuno-regulatory programs, including
product candidates to prevent life-threatening complications in
patients undergoing hematopoietic cell transplantation and to
promote immune tolerance in patients with autoimmune disease. Its
adoptive cell therapy programs are based on the Company’s novel ex
vivo cell programming approach, which it applies to modulate the
therapeutic function and direct the fate of immune cells. Fate
Therapeutics is headquartered in San Diego, CA. For more
information, please visit www.fatetherapeutics.com.
Forward-Looking Statements
This release contains "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995, including statements regarding the Company’s advancement
of and plans related to the Company’s product candidates, clinical
studies, research and development programs, the Company’s progress
and plans for its clinical investigation of ProTmune™ and of
FATE-NK100, the Company’s expected product development and
regulatory strategy for its iPSC-derived product candidates, the
scope of the Company’s intellectual property, and the Company’s
projected cash expenditures. These and any other forward-looking
statements in this release are based on management's current
expectations of future events and are subject to a number of risks
and uncertainties that could cause actual results to differ
materially and adversely from those set forth in or implied by such
forward-looking statements. These risks and uncertainties include,
but are not limited to, the risk that results observed in prior
studies, including preclinical studies of ProTmune and the
Company’s other product candidates, will not be observed in ongoing
or future studies involving these product candidates, the risk that
the Company may cease or delay preclinical or clinical development
activities for any of its existing or future product candidates for
a variety of reasons (including requirements that may be imposed by
regulatory authorities and requirements for regulatory approval,
difficulties or delays in patient enrollment in current and planned
clinical trials, and any adverse events or other negative results
that may be observed during preclinical or clinical development),
and the risk that the Company’s expenditures may exceed current
expectations for a variety of reasons. For a discussion of other
risks and uncertainties, and other important factors, any of which
could cause our actual results to differ from those contained in
the forward-looking statements, see the risks and uncertainties
detailed in the Company’s periodic filings with the Securities and
Exchange Commission, including but not limited to the Company’s
most recently filed periodic report, and from time to time the
Company’s other investor communications. Fate Therapeutics is
providing the information in this release as of this date and does
not undertake any obligation to update any forward-looking
statements contained in this release as a result of new
information, future events or otherwise.
Availability of Other Information about Fate
Therapeutics, Inc.
Investors and others should note that the Company
routinely communicates with investors and the public using its
website (www.fatetherapeutics.com) and its investor relations
website (ir.fatetherapeutics.com), including without limitation,
through the posting of investor presentations, SEC filings, press
releases, public conference calls and webcasts on these websites.
The information posted on these websites could be deemed to be
material information. As a result, investors, the media, and others
interested in Fate Therapeutics are encouraged to review this
information on a regular basis. The contents of the Company’s
website, or any other website that may be accessed from the
Company’s website, shall not be deemed incorporated by reference in
any filing under the Securities Act of 1933, as amended.
|
|
Condensed Consolidated Statements of Operations
and Comprehensive Loss |
|
(in thousands, except share and per share
data) |
|
|
|
|
|
|
Three Months EndedMarch
31, |
|
|
|
|
2017 |
|
|
|
2016 |
|
|
|
(unaudited) |
Collaboration revenue |
|
$ |
1,027 |
|
|
$ |
1,322 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
Research
and development |
|
|
7,966 |
|
|
|
6,636 |
|
General
and administrative |
|
|
3,032 |
|
|
|
2,602 |
|
Total
operating expenses |
|
|
10,998 |
|
|
|
9,238 |
|
Loss
from operations |
|
|
(9,971 |
) |
|
|
(7,916 |
) |
Other
income (expense): |
|
|
|
|
|
|
|
|
Interest
income |
|
|
111 |
|
|
|
27 |
|
Interest
expense |
|
|
(266 |
) |
|
|
(488 |
) |
Total
other expense, net |
|
|
(155 |
) |
|
|
(461 |
) |
Net
loss |
|
$ |
(10,126 |
) |
|
$ |
(8,377 |
) |
Other
comprehensive gain (loss): |
|
|
|
|
|
|
|
|
Unrealized gain (loss) on available-for-sale securities, net |
|
|
(33 |
) |
|
|
14 |
|
Comprehensive loss |
|
$ |
(10,159 |
) |
|
$ |
(8,363 |
) |
Net loss
per common share, basic and diluted |
|
$ |
(0.24 |
) |
|
$ |
(0.29 |
) |
Weighted-average common shares used to compute basic and diluted
net loss per share |
|
|
41,388,329 |
|
|
|
28,777,790 |
|
|
|
|
Condensed Consolidated Balance
Sheets |
(in thousands) |
|
|
|
|
March 31, |
|
|
|
December 31, |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
(unaudited) |
|
|
|
|
Assets |
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
40,608 |
|
|
$ |
88,609 |
Short-term investments |
|
|
41,692 |
|
|
|
3,503 |
Prepaid
expenses and other current assets |
|
|
1,137 |
|
|
|
1,211 |
Total
current assets |
|
|
83,437 |
|
|
|
93,323 |
Long-term assets |
|
|
1,892 |
|
|
|
1,725 |
Total
assets |
|
$ |
85,329 |
|
|
$ |
95,048 |
|
|
|
|
|
|
|
|
Liabilities and stockholders’ equity |
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
Accounts
payable and accrued expenses |
|
$ |
7,169 |
|
|
$ |
4,891 |
Long-term
debt, current portion |
|
|
7,620 |
|
|
|
8,187 |
Current
portion of deferred revenue |
|
|
2,105 |
|
|
|
2,105 |
Other
current liabilities |
|
|
3 |
|
|
|
4 |
Total
current liabilities |
|
|
16,897 |
|
|
|
15,187 |
Long-term debt, net of current portion |
|
|
1,081 |
|
|
|
2,501 |
Deferred
revenue |
|
|
2,303 |
|
|
|
2,829 |
Other
long-term liabilities |
|
|
1,190 |
|
|
|
1,377 |
Stockholders’ equity |
|
|
63,858 |
|
|
|
73,154 |
Total
liabilities and stockholders’ equity |
|
$ |
85,329 |
|
|
$ |
95,048 |
|
Contact:
Christina Tartaglia
Stern Investor Relations, Inc.
212.362.1200
christina@sternir.com
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