BOSTON, May 7, 2020 /PRNewswire/ -- Stealth
BioTherapeutics Corp (Nasdaq: MITO), a clinical-stage biotechnology
company focused on the discovery, development and commercialization
of novel therapies for diseases involving mitochondrial
dysfunction, today reported financial results for the first quarter
ended March 31, 2020 and provided a
corporate update.
"Our industry – and our global community – is facing
unprecedented challenges due to the COVID-19 pandemic. In
these trying times, Stealth is fortunate to have strong shareholder
support, leaving us well-capitalized into 2021, with enthusiastic
and focused employees, who have shown tremendous dedication to
developing mitochondrial medicines for patients suffering from
cardiomyopathic, ophthalmic, neurological and neuropathic
disorders," said Reenie McCarthy,
chief executive officer of Stealth. "Our team has rallied
remarkably to work to ensure the continued progress of our ongoing
clinical and regulatory efforts and the safety of our
patients. We look forward to additional regulatory
interactions regarding our Barth program, hopefully, over the
summer and hope to see an uptick in enrollment in our Phase
2b study in dry AMD as various
regions of the country reopen in the coming weeks. We are
also continuing our efforts to expand our rare metabolic
cardiomyopathy franchise and advance our pipeline of novel
mitochondrial medicines."
COVID-19 Business Update:
Ongoing Clinical Trials
Stealth is committed to advancing its ongoing clinical programs
in Barth and dry AMD. As previously announced, the Company
anticipates completing enrollment for its Phase 2b trial in dry AMD by year-end and hopes to see
an uptick in enrollment as various regions of the country reopen in
the coming weeks. The Company is continually monitoring additional
risks and potential delays in its clinical study sites and contract
research organizations and will provide any further updates as
appropriate.
Drug Supply
The Company believes that it has sufficient drug supply to
complete its ongoing clinical studies and does not expect delays to
its ongoing clinical trials due to manufacturing or supply-chain
issues as a result of COVID-19.
First Quarter 2019 and Recent Highlights
- Announced $20 million
financing. In April 2020, the
Company closed a $20 million private
placement with Morningside Venture (I) Investments Limited,
extending its expected financial runway into 2021.
- Type C meeting. In March
2020, the Company had a productive Type C meeting with the
Division of Rare Disease and Medical Genetics (DRDMG) of the U.S.
Food and Drug Administration (FDA) to discuss its data in Barth
syndrome. The Company has requested a follow-up Type C meeting with
DRDMG, expected this summer, to present and discuss additional data
requested by the DRDMG and to further clarify a potential path to
NDA.
- Announced improvement in cardiac function in Barth. In
March 2020, data presented at the
American College of Cardiology (ACC) 2020 Virtual Annual Meeting
showed that treatment through week 36 of the open-label extension
study with elamipretide was associated with significant improvement
in the slope of change from baseline for left ventricular stroke
volume (p=0.0001), as well as significant improvements from
baseline in left ventricular end diastolic (p=0.0004) and end
systolic (p=0.0098) volumes, as well as trends toward improvement
in other echocardiographic parameters. Together, the data suggest
that prolonged treatment with elamipretide may lead to cardiac
reverse remodeling.
- Announced Barth rare pediatric designation. In
March 2020, the Company announced
receipt of Rare Pediatric Disease (RPD) designation from the FDA
for elamipretide for the treatment of Barth syndrome. Under this
program, upon FDA priority review and approval of elamipretide for
Barth syndrome, if any, the Company would be eligible for a voucher
that could be used to obtain priority review for a subsequent human
drug application.
- Announced positive Barth data from efficacy study. In
February 2020, the Company announced
positive results from its SPIBA-001 natural history comparative
control efficacy study in Barth patients, demonstrating a greater
than 80 meter improvement in the primary endpoint of 6 Minute Walk
Test at one year compared to natural history controls
(p=0.0005).
- Expanded clinical pipeline. In January 2020, the Company initiated a
first-in-human Phase 1 trial evaluating its second-generation
pipeline compound, SBT-272, in healthy subjects. The Company
anticipates that preclinical data expected later this year in
models of amyotrophic lateral sclerosis (ALS) and multiple system
atrophy (MSA) will help inform SBT-272's clinical development
pathway for rare neurodegenerative diseases.
- Implemented strategic repositioning. In January 2020, the Company implemented strategic
actions to reduce costs and reposition its focus on Barth and other
rare metabolic cardiomyopathies, in addition to its ophthalmic and
pipeline neurology programs following the 2019 year-end
announcement of its MMPOWER-3 clinical study results.
Key Upcoming Milestones
- Requesting follow-up Type C meeting with FDA to discuss
additional data and regulatory path in Barth syndrome.
- Complete enrollment of Phase 2 clinical trial in dry AMD
expected by year-end 2020.
- Pre-clinical data for SBT-272 in ALS and MSA and for SBT-259 in
Charcot-Marie-Tooth disease expected by year-end 2020.
Financial Results for the Three Months Ended March 31, 2020
Cash Position: Cash and cash equivalents were
$31.2 million at March 31, 2020, compared to $50.8 million at December
31, 2019. An additional $20.0
million was received in April
2020, pursuant to a private placement transaction with
Morningside Venture (I) Investments Limited.
Research and Development (R&D) Expenses:
R&D expenses were $9.8 million
for the three months ended March 31,
2020, compared to $14.3
million for the same period in 2019. The decrease was
primarily due to a $1.7 million
decrease in employee and consultant costs, offset by a net
$0.5 million increase attributable to
the strategic repositioning, a $1.5
million net decrease in clinical trial costs due to timing
of trials, a $1.3 million decrease in
contract manufacturing, a $0.3
million decrease in discovery related expenses due to timing
of activities and a $0.2 million
decrease in regulatory costs.
General and Administrative (G&A) Expenses:
G&A expenses were $5.2 million
for the three months ended March 31,
2020, compared to $4.2 million
for the same period in 2019. The increase in administrative
expenses was attributed to a $0.8
million increase in professional services and activities
attributable to operating as a public company, a $0.7 million increase in employee and consultant
related costs primarily driven by share based compensation expense,
and a net $0.4 million increase in
employee costs attributable to its strategic repositioning, offset
in part by a decrease of $0.9 million
in pre-commercial activities attributable to the strategic
repositioning.
Other Expense, Net:
Other expense was $0.5 million for
the three months ended March 31,
2020, compared to $24.7
million for the same period in 2019. The decrease in other
expense is primarily attributed to a non-cash $22.7 million loss on extinguishment of debt
associated with the conversion of convertible notes into ordinary
shares in connection with our 2019 IPO, a $4.0 million decrease in interest expense related
to the convertible debt, a $0.3
million change in fair value of warrant liability. These
decreases were offset in part by a $2.7
million change in fair value gain on the derivative
liability associated with the convertible debt and a $0.1 million decrease in interest income.
Net Loss:
Net loss was $15.5 million, or
$0.04 basic and diluted net loss per
ordinary share, for the three months ended March 31, 2020, as compared to $43.2 million, or $0.20 basic and diluted net loss per ordinary
share, for the same period in 2019. The decreased loss was
primarily attributable to the $22.7
million non-cash loss associated with the conversion of
convertible notes in connection with our 2019 IPO, decreased
operating costs of $3.5 million and a
net decrease in other expenses of $1.5
million.
Conference Call
Management will host a conference call today at 8:30 am ET to discuss the financial results and
provide a general business update. The call can be accessed by
dialing 1 (866) 939-3921 or 1 (678) 302-3550 (international) and
referencing conference ID 49677344. A live audio webcast of the
event can be accessed by visiting the Investors & News section
of Stealth's Investor website, https://investor.stealthbt.com/. A
replay of the webcast will be archived on Stealth's website for 30
days following the event.
About Stealth
We are a clinical-stage biotechnology company focused on the
discovery, development and commercialization of novel therapies for
diseases involving mitochondrial dysfunction. Mitochondria, found
in nearly every cell in the body, are the body's main source of
energy production and are critical for normal organ function.
Dysfunctional mitochondria characterize a number of rare genetic
diseases and are involved in many common age-related diseases,
typically involving organ systems with high energy demands such as
the heart, the eye, and the brain. We believe our lead product
candidate, elamipretide, has the potential to treat both rare
metabolic cardiomyopathies, such as Barth, Duchenne and Becker
muscular dystrophies and Friedreich's ataxia, as well as ophthalmic
diseases entailing mitochondrial dysfunction, such as dry
age-related macular degeneration and Leber's hereditary optic
neuropathy. We are evaluating our second-generation clinical stage
candidate, SBT-272, for rare neurodegenerative disease indications
following promising preclinical data in amyotrophic lateral
sclerosis, or ALS. We have optimized our discovery platform to
identify novel mitochondria-targeted compounds, including SBT-259,
the SBT-550 series of compounds, and other compounds which may be
nominated as therapeutic product candidates or utilized as
scaffolds to deliver other compounds to mitochondria.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of The Private Securities Litigation Reform Act of
1995. Such forward-looking statements include those regarding
Stealth BioTherapeutics' plans, strategies and expectations for its
preclinical and clinical advancement of its drug development
programs, including its ongoing clinical trials of elamipretide and
SBT-272; the potential benefits of Stealth BioTherapeutics' product
candidates; its key milestones for 2020; its plans regarding future
data presentations; its anticipated interactions with regulatory
agencies; and its financial guidance regarding the period in which
it will have capital available to fund its operations.
Statements that are not historical facts, including
statements about Stealth BioTherapeutics' beliefs, plans and
expectations, are forward-looking statements. The words
"anticipate," "expect," "hope," "plan," "potential," "possible,"
"will," "believe," "estimate," "intend," "may," "predict,"
"project," "would" and similar expressions are intended to identify
forward-looking statements, although not all forward-looking
statements contain these identifying words. Stealth
BioTherapeutics may not actually achieve the plans, intentions or
expectations disclosed in these forward-looking statements, and you
should not place undue reliance on these forward-looking
statements. Actual results or events could differ materially
from the plans, intentions and expectations disclosed in the
forward-looking statements as a result of known and unknown risks,
uncertainties and other important factors, including: Stealth
BioTherapeutics' ability to obtain additional funding and to
continue as a going concern; the impact of the COVID-19 pandemic;
the ability to successfully demonstrate the efficacy and safety of
Stealth BioTherapeutics' product candidates and future product
candidates; the preclinical and clinical results for Stealth
BioTherapeutics' product candidates, which may not support further
development and marketing approval; the potential advantages of
Stealth BioTherapeutics' product candidates; the content and timing
of decisions made by the U.S. FDA, the EMA or other regulatory
authorities, investigational review boards at clinical trial sites
and publication review bodies, which may affect the initiation,
timing and progress of preclinical studies and clinical trials of
Stealth BioTherapeutics product candidates; Stealth
BioTherapeutics' ability to obtain and maintain requisite
regulatory approvals and to enroll patients in its planned clinical
trials; unplanned cash requirements and expenditures; competitive
factors; Stealth BioTherapeutics' ability to obtain, maintain and
enforce patent and other intellectual property protection for any
product candidates it is developing; and general economic and
market conditions. These and other risks are described in
greater detail under the caption "Risk Factors" included in the
Stealth BioTherapeutics' most recent Annual Report on Form 20-F
filed with the Securities and Exchange Commission ("SEC"), as well
as in any future filings with the SEC. Forward-looking
statements represent management's current expectations and are
inherently uncertain. Except as required by law, Stealth
BioTherapeutics does not undertake any obligation to update
forward-looking statements made by us to reflect subsequent events
or circumstances.
Investor Relations
Stern Investor Relations
Lauren Stival, 212-362-1200
IR@StealthBT.com
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STEALTH
BIOTHERAPEUTICS CORP
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|
|
|
|
|
Condensed
Consolidated Statements of Operations
|
|
(in thousands, except share and per share data)
|
|
(unaudited)
|
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|
|
|
|
|
|
|
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Three months
ending March 31,
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|
|
2020
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2019
|
|
Operating
expenses:
|
|
|
|
|
|
Research and
development
|
|
$
9,847
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|
$
14,328
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|
General and
administrative
|
|
5,180
|
|
4,157
|
|
Total operating
expenses
|
|
15,027
|
|
18,485
|
|
Loss from
operations
|
|
(15,027)
|
|
(18,485)
|
|
Other income
(expense):
|
|
|
|
|
|
Loss on extinguishment
of debt
|
|
—
|
|
(22,700)
|
|
Change in fair value
of derivative liability
|
|
—
|
|
2,782
|
|
Change in fair value
of warrant liability
|
|
—
|
|
(300)
|
|
Interest
income
|
|
123
|
|
208
|
|
Interest expense and
other
|
|
(636)
|
|
(4,683)
|
|
Total other
expense
|
|
(513)
|
|
(24,693)
|
|
Net loss attributable
to ordinary shareholders
|
|
$
(15,540)
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|
$
(43,178)
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|
Net loss per share
attributable to ordinary shareholders —
basic and diluted
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|
$
(0.04)
|
|
$
(0.20)
|
|
Weighted average
ordinary shares used in net loss per share
attributable to ordinary shareholders — basic and
diluted
|
|
436,720,810
|
|
220,035,294
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STEALTH
BIOTHERAPEUTICS CORP
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|
Condensed
Consolidated Balance Sheets
|
(in thousands)
|
(unaudited)
|
|
|
March
31,
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December
31,
|
|
|
2020
|
|
2019
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Assets
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|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents (a)
|
|
$
31,242
|
|
$
50,768
|
Prepaid expenses and
other current assets
|
|
620
|
|
1,630
|
Total current
assets
|
|
31,862
|
|
52,398
|
Property and
equipment, net
|
|
285
|
|
345
|
Total
assets
|
|
$
32,147
|
|
$
52,743
|
Liabilities and
shareholders' equity
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
6,513
|
|
$
9,520
|
Accrued expenses and
other current liabilities
|
|
7,270
|
|
8,495
|
Accrued interest
payable
|
|
1,303
|
|
1,219
|
Current portion of
long-term debt
|
|
14,634
|
|
14,716
|
Total current
liabilities
|
|
29,720
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|
33,950
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Long-term debt, less
current portion
|
|
—
|
|
1,526
|
Total
liabilities
|
|
29,720
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|
35,476
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Total shareholders'
equity
|
|
2,427
|
|
17,267
|
Total liabilities
and shareholders' equity
|
|
$
32,147
|
|
$
52,743
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|
|
|
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(a)
|
An additional $20.0
million was received in April 2020, pursuant to a private
placement
transaction with Morningside Venture (I) Investments
Limited
|
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SOURCE Stealth BioTherapeutics Inc.