SELLAS Life Sciences Group, Inc. (Nasdaq: SLS) (“SELLAS” or the
“Company”), a clinical-stage biopharmaceutical company focused on
the development of novel cancer immunotherapies for a broad range
of cancer indications, today reported financial results for the
year ended December 31, 2018 and provided a business update.
“In February, we initiated a review of a wide range of strategic
alternatives to maximize shareholder value, such as a sale of the
Company, a merger, or a strategic investment or financing,” stated
Dr. Angelos M. Stergiou, M.D., ScD h.c., President and Chief
Executive Officer of SELLAS. “We are currently actively exploring
these alternatives with the goal of identifying a plan that will
enhance shareholder value while advancing our novel cancer
immunotherapy clinical pipeline.”
2018 and Recent Business Highlights
Corporate Developments
- In February 2019, the Company announced that its Board of
Directors is conducting a review of strategic options focusing on
maximizing shareholder value. SELLAS has engaged Cantor Fitzgerald
& Co. to act as its strategic and financial advisor for this
process.
- In March 2019, the Company entered into a warrant exchange
agreement with a single investor, the proceeds of which are being
used by the Company to further its development programs and
business operations during the strategic alternatives evaluation
process.
Clinical Pipeline
Galinpepimut-S (GPS)
- In November 2018, following discussion with the U.S. Food and
Drug Administration (FDA), the Company announced a streamlined
clinical trial design and biostatistical plan for a Phase 3
registrational study for GPS in acute myeloid leukemia (AML). The
planned Phase 3 registrational study will be a 1:1 randomized,
open-label study comparing GPS in the maintenance setting to
investigators’ choice of best available treatment in adult AML
patients who have achieved hematologic complete remission, with or
without thrombocytopenia (CR2/CR2p), after second-line antileukemic
therapy and who are deemed ineligible for or unable to undergo
allogeneic stem-cell transplantation. The primary endpoint is
overall survival and secondary endpoints include leukemia-free
survival, antigen-specific T-cell immune response dynamics over
time and rates of achievement of measurable residual disease
negativity. The study will have a planned interim safety and
futility analysis after 80 events (deaths). The Phase 3 study is
expected to enroll approximately 116 patients at approximately 50
clinical sites in the United States and Europe. The Company is
completing preparations for the initiation of this study which is
subject to the receipt of sufficient funding. This study is being
led by Drs. Hagop Kantarjian of MD Anderson Cancer Center and Gert
Ossenkoppele of Amsterdam University Medical Center (VUMC) and the
HOVON network.
- In December 2018, SELLAS initiated enrollment of the Phase 1/2
open-label, non-comparative, multicenter, multi-arm study of GPS in
combination with Merck’s anti-PD-1 therapy Keytruda®
(pembrolizumab) in patients with selected WT1-positive advanced
cancers, including both hematologic malignancies and solid tumors.
This study, which is being conducted under a Clinical Trial
Collaboration and Supply Agreement with Merck (known as MSD outside
the United States and Canada), will assess the efficacy and safety
of the combination, with exploratory long-term follow-up for
overall survival and safety, and is expected to enroll
approximately 90 patients at up to 20 sites in the United States.
The initial tumor types to be treated will be AML (patients unable
to attain deeper morphological response than partial on
hypomethylating agents and who are not eligible for allogeneic
hematopoietic stem cell transplant) and ovarian cancer (second or
third line), to be followed by triple negative breast cancer (TNBC)
(second line), small cell lung cancer (second line), and colorectal
cancer (third or fourth line). The study is being led by Drs.
Richard Maziarz of Oregon Health and Science University and Roisin
O’Cearbhaill of Memorial Sloan Kettering Cancer Center.
Nelipepimut-S (NPS)
- In 2018, the Company announced positive data from a
prospective, randomized, single-blinded, controlled Phase 2b
independent investigator-sponsored clinical trial of the
combination of NPS (NeuVax™) + trastuzumab (Herceptin®) targeting
HER2 low-expressing breast cancer patient cohorts. In the study,
NPS + trastuzumab demonstrated clinically and statistically
significant efficacy in the cohort of patients with TNBC, with a
p-value of 0.013 and a 75.2% reduction in risk of relapse or
death.
- A preplanned secondary efficacy analysis across human leukocyte
antigen (HLA) allele subgroups from the Phase 2b study confirmed
the therapeutic potential of NPS in patients with early-stage TNBC
in the adjuvant setting across HLA types A-02, -03, -24 and -26,
which cover approximately 80-85% of the North American/European
populations and 86-90% of Asian/Pacific basin populations.
Additional positive data from the Phase 2b study showed a
clinically meaningful and statistically significant decrease in the
number of clinically detectable relapses in the TNBC cohort with
the combination of NPS + trastuzumab (7.5%) vs. trastuzumab alone
(27.3%) (p=0.004). In addition, four pre-defined subgroups of TNBC
patients in the NPS +trastuzumab arm demonstrated an average
decrease of 84.2% in relative risk of relapse or death at 24 months
(p=0.004-0.014).
- Based on the Phase 2b data presented in 2018, as well as the
unanimous recommendation of the Data Safety Monitoring Board to
expeditiously seek regulatory guidance from the FDA for further
development of NPS + trastuzumab in TNBC, SELLAS is currently in
continuing active discussions with the FDA.
Year End 2018 Financial Results
Cash Position: As of December 31, 2018, cash
and cash equivalents were $5.3 million, compared to $2.3 million as
of December 31, 2017. Net cash used in operating activities was
$30.4 million for the year ended December 31, 2018, compared to
$11.0 million for the year ended December 31, 2017. Net cash
provided by financing activities was $23.1 million for the year
ended December 31, 2018, primarily attributable to $31.5 million in
net proceeds from the sale of equity securities, partially offset
by $7.6 million in principal payments on previously outstanding
debt. Net cash provided by financing activities for the year ended
December 31, 2017 was $5.5 million, primarily attributable to $6
million in net proceeds from the sale of equity securities,
partially offset by $0.5 million on previously outstanding
long-term debt.
R&D Expenses: Research and
development expenses were $8.8 million for the year ended December
31, 2018, as compared to $6.1 million for the year ended December
31, 2017. The $2.7 million increase was primarily due to increases
in clinical and regulatory consulting and other clinical expenses
related to startup costs for the Phase 1/2 basket trial of GPS in
combination with pembrolizumab (Keytruda®) in multiple tumor types
during 2018, and ongoing costs incurred related to the Phase 2b
trial of NPS in combination with trastuzumab (Herceptin®). These
increases were partially offset by decreases in compensation and
benefits, including stock-based compensation, and manufacturing
expenses.
G&A Expenses: General and
administrative expenses were $12.8 million for the year ended
December 31, 2018, as compared to $15.1 million for the year ended
December 31, 2017. The $2.3 million decrease was primarily driven
by a decrease in compensation and employee benefits, including
stock-based compensation, and in banking and advisory fees
partially offset by increases in outside services and public
company costs, rebates and returns of former commercial products,
and insurance premiums.
Net Loss: Net loss for the year ended December
31, 2018 was $27.7 million and loss attributable to common
stockholders was $41.3 million, or a basic and diluted loss per
share to common stockholders of $4.82, as compared to a net loss of
$23.8 million and loss attributable to common stockholders of $24.4
million for the year ended December 31, 2017, or a basic and
diluted loss per share to common stockholders of $10.44. Net loss
and loss attributable to common stockholders for the year ended
December 31, 2018 includes a $9.6 million one-time non-cash
impairment charge of in-process research and development associated
with the termination of a license agreement for anagrelide CR
formulation (GALE-401).
Keytruda® and Herceptin® are registered
trademarks of Merck Sharp & Dohme Corp., a subsidiary of Merck
& Co., Inc., Kenilworth, N.J., USA, and Genentech, Inc.,
respectively, and are not trademarks of SELLAS. The manufacturers
of these brands are not affiliated with and do not endorse SELLAS
or its products.
About SELLAS Life Sciences Group, Inc.
SELLAS is a clinical-stage biopharmaceutical company focused on
novel cancer immunotherapeutics for a broad range of cancer
indications. SELLAS’ lead product candidate, GPS, is licensed from
Memorial Sloan Kettering Cancer Center and targets the Wilms Tumor
1 (WT1) protein, which is present in an array of tumor types. GPS
has potential as a monotherapy or in combination to address a broad
spectrum of hematologic malignancies and solid tumor indications.
SELLAS has a Phase 3 clinical trial planned (pending funding
availability) for GPS in AML and is also studying GPS in
combination with pembrolizumab (Keytruda®) in multiple indications.
SELLAS has received Orphan Drug designations for GPS from the FDA
and the European Medicines Agency for AML, malignant pleural
mesothelioma (MPM), and multiple myeloma (MM); GPS has also
received Fast Track designation for AML, MPM and MM from the FDA.
SELLAS’ second product candidate, NPS, is a HER2-directed cancer
immunotherapy being investigated for the prevention of the
recurrence of breast cancer after standard of care treatment in the
adjuvant setting. NPS has received Fast Track status designation by
FDA for the treatment of patients with early stage breast cancer
with low to intermediate HER2 expression, otherwise known as HER2
1+ or 2+, which includes TNBC patients, following standard of
care.
For more information on SELLAS, please visit
www.sellaslifesciences.com.
Forward-Looking Statements
This press release contains forward-looking statements. All
statements other than statements of historical facts are
“forward-looking statements,” including those relating to future
events. In some cases, forward-looking statements can be identified
by terminology such as “plan,” “expect,” “anticipate,” “may,”
“might,” “will,” “should,” “project,” “believe,” “estimate,”
“predict,” “potential,” “intend,” or “continue” and other words or
terms of similar meaning. These statements include, without
limitation, statements related to the Company’s plans to explore
strategic alternatives, the potential outcome and benefits of a
strategic transaction or a financing, the further development of
GPS and NPS, including the timing of clinical results, the
potential time to market for GPS and NPS, the potential results
from a clinical trial and interactions with the U.S. Food and Drug
Administration. These forward-looking statements are based on
current plans, objectives, estimates, expectations and intentions,
and inherently involve significant risks and uncertainties. Actual
results and the timing of events could differ materially from those
anticipated in such forward-looking statements as a result of these
risks and uncertainties, which include, without limitation, risks
and uncertainties associated with the Company’s ability to identify
potential strategic and financial transactions and to complete any
transactions it pursues, whether SELLAS will be able to realize the
expected benefits from a strategic review or a strategic
transaction, immune-oncology product development and clinical
success thereof, the uncertainty of regulatory approval, the
uncertainty of finding potential partners for product candidate
development, and other risks and uncertainties affecting SELLAS and
its development programs as set forth under the caption “Risk
Factors” in SELLAS’ Annual Report on Form 10-K filed on March 22,
2019 and in its other SEC filings. Other risks and uncertainties of
which SELLAS is not currently aware may also affect SELLAS’
forward-looking statements and may cause actual results and the
timing of events to differ materially from those anticipated. The
forward-looking statements herein are made only as of the date
hereof. SELLAS undertakes no obligation to update or supplement any
forward-looking statements to reflect actual results, new
information, future events, changes in its expectations or other
circumstances that exist after the date as of which the
forward-looking statements were made.
Investor Contact:Will O’ConnorStern Investor
Relations, Inc.212-362-1200ir@sellaslife.com
Investor RelationsSELLAS Life Sciences Group,
Inc.917.438.4353info@sellaslife.com
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