Fate Therapeutics Reports Third Quarter 2017 Financial Results
November 01 2017 - 04:01PM
Clinical Data from First Subjects in VOYAGE Study
of FATE-NK100 for Acute Myelogenous Leukemia to be Presented at
SITC 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 third quarter ended September 30, 2017.
“We are poised to release initial Phase 1 clinical data for
FATE-NK100 and ProTmune at prominent scientific conferences during
the coming weeks,” said Scott Wolchko, President and Chief
Executive Officer of Fate Therapeutics. “Additionally, we are
pleased that two first-of-kind product candidates from our
proprietary iPSC-derived cancer immunotherapy pipeline have been
selected for oral presentations at the 2017 American Society of
Hematology Annual Meeting. Thousands of doses of homogeneous drug
product can be produced from a clonal iPSC master cell line in a
single manufacturing run. This represents a transformative approach
to enable off-the-shelf delivery of cancer immunotherapies that are
uniformly engineered and identical in composition from dose-to-dose
across patients. At ASH we will be unveiling exciting new
preclinical and manufacturing data to support our 2018 path to
clinic for iPSC-derived NK- and T-cell product candidates.”
Recent Highlights & Program
Updates
- Initial Clinical Data from VOYAGE Study of FATE-NK100
in AML to be Presented at SITC 2017. VOYAGE is an
open-label, accelerated dose-escalation clinical trial of
FATE-NK100, the Company’s first-in-class adaptive memory natural
killer (NK) cell product candidate, for the treatment of refractory
or relapsed acute myelogenous leukemia (AML). FATE-NK100 has
advanced through the first two of three dose cohorts in VOYAGE. The
Company will present the post-manufacturing potency, in vivo
persistence and anti-tumor activity of FATE-NK100 from the first
two subjects at the Society for Immunotherapy of Cancer (SITC) 32nd
Annual Meeting during a poster session on November 10. The
peer-reviewed non-clinical data describing the unique properties
and anti-tumor activity of FATE-NK100 were published in Cancer
Research in August.
- APOLLO Study of FATE-NK100 in Recurrent Ovarian Cancer
Open for Enrollment. In October, enrollment was
opened in the APOLLO study of FATE-NK100 for the treatment of women
with ovarian cancer resistant to, or recurrent on, platinum-based
treatment. APOLLO is designed to evaluate the safety and determine
the maximum dose of a single infusion of FATE-NK100 when
administered directly into the peritoneum in an outpatient setting.
Intraperitoneal delivery of NK cells is a novel strategy intended
to promote co-localization with tumor cells and maximize NK cell
persistence and anti-tumor activity. Other study endpoints include
objective response rate at 28 days post-infusion and
progression-free and overall survival.
- First Subject Treated in PROTECT Phase 2 Efficacy
Stage. PROTECT is a combined open-label Phase 1 /
blinded Phase 2 clinical trial of ProTmune, a next-generation
hematopoietic cell graft for patients with hematologic malignancies
undergoing allogeneic hematopoietic cell transplantation (HCT). In
October, the first subject was treated in the randomized,
controlled and blinded Phase 2 stage. The Phase 2 stage is
assessing the safety and efficacy of ProTmune in 60 subjects, where
subjects are being randomized, in a 1:1 ratio, to receive either
ProTmune or a conventional matched unrelated donor mobilized
peripheral blood cell graft. The primary efficacy endpoint is
incidence of acute graft-versus-host disease (GvHD) by Day 100
post-HCT, where prospective clinical studies have shown that 40% to
80% of patients undergoing matched unrelated donor HCT experience
Grades 2-4 acute GvHD.
- Day 100 Data from PROTECT Phase 1 Stage to be Presented
at 2017 ASH. The Company will present data on all
seven subjects administered ProTmune in the Phase 1 stage of
PROTECT at the 59th American Society of Hematology (ASH) Annual
Meeting during a poster session on December 11. Key clinical
outcomes, including incidence of acute GvHD, cancer relapse and
survival, at 100 days following HCT will be released. An ASH
abstract released today highlighted early data on the first five
Phase 1 subjects, three of whom had not yet reached Day 100, as of
a July 31, 2017 data cut-off.
- First iPSC-derived T-Cell Product Candidate to be
Showcased during Oral Presentation at 2017 ASH. An
oral presentation will describe the generation of CD8αβ+ T cells
from an induced pluripotent stem cell (iPSC) line engineered to
express a chimeric antigen receptor (CAR). This breakthrough was
led by Dr. Michel Sadelain, MD, PhD, Director, Center for Cell
Engineering, Memorial Sloan Kettering Cancer Center (MSK), under
the Company’s multi-year sponsored research collaboration with MSK.
The Company’s first iPSC-derived CAR T-cell product candidate
FT819, which is derived from a clonal iPSC master cell line
engineered to express a CAR targeting CD19 and edited to remove
T-cell receptor (TCR) expression, is undergoing preclinical
development.
- First iPSC-derived NK Cell Product Candidate FT500 to
be Showcased during Oral Presentation at 2017 ASH. An oral
presentation by Jeffrey S. Miller, MD, Deputy Director of the
Masonic Cancer Center, University of Minnesota, will describe the
production under current good manufacturing practice (cGMP)
conditions of FT500, the Company’s first-of-kind NK cell product
candidate derived from a clonal iPSC master cell line. Fate
Therapeutics plans to file a landmark Investigational New Drug
(IND) application with the U.S. Food & Drug Administration
(FDA) in the first quarter of 2018 to initiate first-in-human
clinical investigation of FT500 in combination with FDA-approved
checkpoint inhibitors for the treatment of advanced solid
tumors.
- Key Patent Issued for Enhanced Genetic Engineering of
CD34+ Cells. In August, the Company announced that
the U.S. Patent and Trademark Office issued U.S. Patent No.
9,675,641 covering the use of prostaglandins as viral transduction
enhancers for the genetic modification of CD34+ hematopoietic
cells. The patent, which broadly covers methods of using
prostaglandins to enhance ex vivo genetic engineering of
hematopoietic cells using viral vectors, is owned by the Indiana
University Research and Technology Corporation and is licensed
exclusively to Fate Therapeutics in all fields. Investigators
recently highlighted in Molecular Therapy that this practice
consistently increased transduction efficiency in primary CD34+
cells sourced from multiple normal human donors and from patients
with β-thalassemia or sickle cell disease, concluding that
prostaglandins may be critical to ensuring successful clinical gene
therapy using lentivirus-modified CD34+ cells.
Third Quarter 2017 Financial
Results
- Cash & Short-term Investment Position:
Cash, cash equivalents and short-term investments as of September
30, 2017 were $69.2 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. This use was offset by $7.5 million in net
cash proceeds received by the Company in July 2017 in connection
with the amendment of its loan agreement with Silicon Valley
Bank.
- Total Revenue: Revenue was $1.0 million for
the third quarter of 2017 and as well as 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 $11.4 million for the third quarter of 2017 compared
to $9.4 million for the comparable period in 2016. Operating
expenses for the third 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 $8.6 million for the third quarter of 2017 compared
to $6.8 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, and an increase in facilities costs
associated with the expansion of the Company’s laboratory
space.
- G&A Expenses: General and administrative
expenses were $2.8 million for the third 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 employee
compensation and benefits expense, including employee stock-based
compensation expense, and an increase in facilities costs
associated with the expansion of the Company’s office space.
- Shares Outstanding: Common shares outstanding
were 41.5 million as of September 30, 2017 and 41.4 million as of
December 31, 2016. Preferred shares outstanding as of September 30,
2017 and December 31, 2016 were 2.82 million, each of which is
convertible into five shares of common stock. All preferred shares
outstanding are from the Company’s sale and issuance of non-voting
Class A convertible preferred stock to Redmile Group, LLC in
November 2016.
Today's Conference Call and WebcastThe Company
will conduct a conference call today, Wednesday, November 1, 2017
at 5:00 p.m. ET to review financial and operating results for the
quarter ended September 30, 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 9892619.
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-NK100FATE-NK100 is a first-in-class
natural killer (NK) cell cancer immunotherapy comprised of adaptive
memory NK cells, a highly specialized and functionally distinct
subset of activated NK cells expressing the maturation marker CD57.
Higher frequencies of CD57+ NK cells in the peripheral blood or
tumor microenvironment in cancer patients have been linked to
better clinical outcomes. FATE-NK100 is produced through a
feeder-free, seven-day manufacturing process during which NK cells
sourced from a healthy donor are activated ex vivo with
pharmacologic modulators.
About ProTmune™ProTmune™ is an investigational
next-generation hematopoietic cell graft for the prevention of
acute graft-versus-host disease (GvHD) in subjects undergoing
allogeneic hematopoietic cell transplantation (HCT). ProTmune is
manufactured by pharmacologically modulating a donor-sourced,
mobilized peripheral blood graft ex vivo with two small molecules
(FT1050 and FT4145) to enhance the biological properties and
therapeutic function of the graft. Acute GvHD is a severe
immunological disease that commonly arises in patients during the
first weeks following allogeneic HCT when the newly-transplanted
donor immune cells attack the patient’s tissues and organs,
resulting in a potentially fatal immune system reaction. The
disease is the leading cause of early morbidity and mortality in
matched unrelated donor transplant, and there are currently no
FDA-approved preventive therapies and very few treatment options
for acute GvHD. ProTmune has been granted Orphan Drug and Fast
Track Designations by the FDA, and Orphan Medicinal Product
Designation by the European Medicines Agency.
About Fate Therapeutics’ iPSC Product
PlatformThe Company’s proprietary induced pluripotent stem
cell (iPSC) product platform enables genetic engineering,
high-throughput single-cell isolation and clonal selection of human
iPSCs and supports long-term maintenance of human iPSCs as master
pluripotent cell lines. Human iPSCs possess the unique dual
properties of unlimited self-renewal and differentiation potential
into all cell types of the body. Similar to master cell lines used
for the manufacture of monoclonal antibodies, clonal iPSC master
cell lines can serve as a renewable cell source for the consistent
and repeated manufacture of homogeneous cell products with the
potential to treat many different diseases and many thousands of
patients in an off-the-shelf manner. Fate Therapeutics’ iPSC
product platform is supported by an intellectual property portfolio
of over 90 issued patents and 100 pending patent applications.
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 cell lines, 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 StatementsThis 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 and the
receipt of data from its ongoing clinical trials, the Company’s
expected product development and regulatory strategy, and
associated timelines, for its iPSC-derived product candidates, the
therapeutic potential of ProTmune and FATE-NK100, and the Company’s
financial condition and 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
and clinical trials of ProTmune and FATE-NK100, will not be
observed in ongoing or future studies involving these product
candidates, the risk of a delay in the enrollment or evaluation of
subjects in any ongoing clinical studies, the risk that the Company
may cease or delay preclinical or clinical development 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 subject enrollment in current and planned clinical
trials, difficulties in manufacturing and supplying the Company’s
product candidates for clinical testing, 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 EndedSeptember
30, |
|
|
|
Nine Months EndedSeptember
30, |
|
|
|
|
2017 |
|
|
|
2016 |
|
|
|
2017 |
|
|
|
2016 |
|
|
|
(unaudited) |
|
Collaboration revenue |
|
$ |
1,026 |
|
|
$ |
1,026 |
|
|
$ |
3,079 |
|
|
$ |
3,375 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research
and development |
|
|
8,578 |
|
|
|
6,804 |
|
|
|
24,471 |
|
|
|
20,222 |
|
General
and administrative |
|
|
2,788 |
|
|
|
2,611 |
|
|
|
8,489 |
|
|
|
7,462 |
|
Total
operating expenses |
|
|
11,366 |
|
|
|
9,415 |
|
|
|
32,960 |
|
|
|
27,684 |
|
Loss
from operations |
|
|
(10,340 |
) |
|
|
(8,389 |
) |
|
|
(29,881 |
) |
|
|
(24,309 |
) |
Other
income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income |
|
|
152 |
|
|
|
37 |
|
|
|
400 |
|
|
|
95 |
|
Interest
expense |
|
|
(378 |
) |
|
|
(385 |
) |
|
|
(856 |
) |
|
|
(1,308 |
) |
Loss on
extinguishment of debt |
|
|
(118 |
) |
|
|
— |
|
|
|
(118 |
) |
|
|
— |
|
Total
other expense, net |
|
|
(344 |
) |
|
|
(348 |
) |
|
|
(574 |
) |
|
|
(1,213 |
) |
Net
loss |
|
$ |
(10,684 |
) |
|
$ |
(8,737 |
) |
|
$ |
(30,455 |
) |
|
$ |
(25,522 |
) |
Other
comprehensive income (loss): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain (loss) on available-for-sale securities, net |
|
|
26 |
|
|
|
(8 |
) |
|
|
(12 |
) |
|
|
3 |
|
Comprehensive loss |
|
$ |
(10,658 |
) |
|
$ |
(8,745 |
) |
|
$ |
(30,467 |
) |
|
$ |
(25,519 |
) |
Net loss
per common share, basic and diluted |
|
$ |
(0.26 |
) |
|
$ |
(0.27 |
) |
|
$ |
(0.74 |
) |
|
$ |
(0.85 |
) |
Weighted-average common shares used to compute basic and diluted
net loss per share |
|
|
41,428,845 |
|
|
|
32,090,174 |
|
|
|
41,407,995 |
|
|
|
29,920,075 |
|
Condensed Consolidated Balance
Sheets |
(in thousands) |
|
|
|
|
September 30,2017 |
|
|
|
December 31,2016 |
|
|
|
|
|
|
|
|
|
|
|
(unaudited) |
Assets |
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
43,231 |
|
|
$ |
88,609 |
Short-term investments and related maturity receivables |
|
|
25,983 |
|
|
|
3,503 |
Prepaid
expenses and other current assets |
|
|
825 |
|
|
|
1,211 |
Total
current assets |
|
|
70,039 |
|
|
|
93,323 |
Long-term assets |
|
|
2,636 |
|
|
|
1,725 |
Total
assets |
|
$ |
72,675 |
|
|
$ |
95,048 |
|
|
|
|
|
|
|
|
Liabilities and stockholders’ equity |
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
Accounts
payable and accrued expenses |
|
$ |
7,611 |
|
|
$ |
4,891 |
Long-term
debt, current portion |
|
|
— |
|
|
|
8,187 |
Current
portion of deferred revenue |
|
|
2,105 |
|
|
|
2,105 |
Other
current liabilities |
|
|
— |
|
|
|
4 |
Total
current liabilities |
|
|
9,716 |
|
|
|
15,187 |
Long-term debt, net of current portion |
|
|
14,789 |
|
|
|
2,501 |
Deferred
revenue |
|
|
1,250 |
|
|
|
2,829 |
Other
long-term liabilities |
|
|
1,171 |
|
|
|
1,377 |
Stockholders’ equity |
|
|
45,749 |
|
|
|
73,154 |
Total
liabilities and stockholders’ equity |
|
$ |
72,675 |
|
|
$ |
95,048 |
Contact:Christina TartagliaStern
Investor Relations, Inc.212.362.1200christina@sternir.com
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