Surface Oncology Reports Financial Results and Corporate Highlights for Second Quarter 2020
August 11 2020 - 6:30AM
Surface Oncology (Nasdaq: SURF), a clinical-stage immuno-oncology
company developing next-generation immunotherapies that target the
tumor microenvironment, today reported financial results and
corporate highlights for the second quarter 2020, as well as
anticipated corporate milestones for the remainder of the year.
“The second quarter of 2020 was one of great progress for
Surface on several fronts. We advanced multiple programs in
clinical development, entered into a clinical collaboration with
Merck and secured additional financial resources via top-tier
investors,” said Jeff Goater, chief executive officer. “Our team
has done an amazing job adapting to challenges from the global
COVID-19 pandemic. To date, our clinical and preclinical timelines
have not been impacted by the pandemic and we continue to monitor
the situation. I could not be more proud of what we have
accomplished, nor more excited about what is to come for Surface in
the second half of 2020.”
Recent Corporate Highlights:
- In April, initiated a Phase 1 clinical trial of its
first-in-class antibody SRF388, which targets the immunosuppressive
cytokine IL-27. The study design is based on a compelling
translational hypothesis supported in part by a study presented at
American Association for Cancer Research (AACR) this year
demonstrating that high levels of IL-27 correlate strongly with the
risk of developing liver cancer. Presentation can be found
here.
- In May, entered into a clinical trial collaboration with Merck
(NYSE: MRK) to evaluate the safety and efficacy of combining
Surface’s SRF617, an investigational antibody therapy targeting
CD39, with Merck’s KEYTRUDA® (pembrolizumab), the first anti-PD-1
therapy approved in the United States. This combination will be
studied as a future component of the ongoing first-in-human Phase
1/1b study of SRF617 and will be evaluated in patients with solid
tumors, with a focus on patients with gastric cancer and those who
have developed resistance to checkpoint inhibition — both areas of
high unmet need.
- In the second quarter, raised approximately $39 million
combined through its At-the-Market (ATM) facility and its venture
debt facility. The ATM offering included participation based upon
interest received from EcoR1 Capital LLC, Venrock Healthcare
Capital Partners, BVF Partners L.P., and RS Investments, a Victory
Capital investment franchise.
- In June, presented updated preclinical data on SRF813 and lead
candidates SRF617 and SRF388 at the 2020 AACR virtual annual
meeting. Presentations can be found in the Posters &
Publications section on this page.
- Advanced SRF813, a high affinity, fully human IgG1 antibody
against CD112R (PVRIG) into IND-enabling studies. Preclinical
studies support SRF813’s differentiated profile compared to the
leading competitor and have indicated CD112R (PVRIG) inhibition
activates both NK and T cells, resulting in robust anti-tumor
activity and immunological memory.
- Continued progression of the ongoing Phase 1/1b trial of NZV930
(targeting CD73) by Surface Oncology’s partner Novartis.
Selected Anticipated 2020 Corporate
Milestones:
- Preclinical data presentations anticipated at Society for
Immunotherapy of Cancer (SITC) in November 2020
- Initial clinical updates for both SRF617 and SRF388 anticipated
by the end of 2020
- IND filing for SRF813 mid 2021
Financial Results:
As of June 30, 2020, cash, cash equivalents and marketable
securities were $112.5 million, compared to $105.2 million on
December 31, 2019.
Research and development (R&D) expenses were $9.5 million
for the second quarter ended June 30, 2020, compared to $13.2
million for the same period in 2019. This decrease was primarily
driven by a reduction in expenses associated with contract
manufacturing and other IND-enabling activities, as a result of the
SRF617 and SRF388 IND filings in 2019, offset by an increase in
spend on the SRF617 and SRF388 Phase 1 clinical trials, which began
in 2020. R&D expenses included $0.7 million in stock-based
compensation expense for the second quarter ended June 30,
2020.
General and administrative (G&A) expenses were $5.0 million
for the second quarter ended June 30, 2020, compared to $5.4
million for the same period in 2019. This decrease was primarily
due to decreased personnel costs and professional fees as a result
of the strategic restructuring announced in January 2020. G&A
expenses included $1.3 million in stock-based compensation expense
for the second quarter ended June 30, 2020.
For the second quarter ended June 30, 2020, net loss was $14.8
million, or basic and diluted net loss per share attributable to
common stockholders of $0.44. Net loss was $17.8 million for the
same period in 2019, or basic and diluted net loss per share
attributable to common stockholders of $0.64.
Financial Outlook:
Surface Oncology continues to project that current cash and cash
equivalents are sufficient to fund the Company into 2022.
About Surface Oncology:
Surface Oncology is an immuno-oncology company developing
next-generation antibody therapies focused on the tumor
microenvironment. Its pipeline includes two wholly-owned lead
programs targeting CD39 (SRF617) and IL-27 (SRF388), a
clinical-stage collaboration with Novartis targeting CD73 (NZV930),
and two preclinical programs, each focused primarily on activating
natural killer cells (via targeting CD112R, also known as PVRIG
(SRF813)) or depleting regulatory T cells (via targeting CCR8
(SRF114)). Surface’s novel cancer immunotherapies are designed to
achieve a clinically meaningful and sustained anti-tumor response
and may be used alone or in combination with other therapies. For
more information, please visit www.surfaceoncology.com.
Cautionary Note Regarding Forward-Looking
Statements:
Certain statements set forth in this press release constitute
“forward-looking” statements within the meaning of the Private
Securities Litigation Reform Act of 1995, as amended.
Forward-looking statements can be identified by terms such as
“believes,” “expects,” “plans,” “potential,” “would,” or similar
expressions, and the negative of those terms. These forward-looking
statements are based on Surface Oncology’s management’s current
beliefs and assumptions about future events and on information
currently available to management.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause Surface Oncology’s
actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements. These risks
include, but are not limited to, risks and uncertainties related to
Surface Oncology’s ability to successfully develop SRF388, SRF617,
SRF813 and its other product candidates through current and future
milestones or regulatory filings on the anticipated timeline, if at
all, the therapeutic potential of Surface Oncology’s product
candidates, the risk that results from preclinical studies or early
clinical trials may not be representative of larger clinical
trials, the risk that Surface Oncology’s product candidates,
including SRF388, SRF617 and SRF813, will not be successfully
developed or commercialized, the risks related to Surface
Oncology’s dependence on third-parties in connection with its
manufacturing, clinical trials and preclinical studies, and the
potential impact of COVID-19 on our clinical and preclinical
development timelines and results of operations. Additional risks
and uncertainties that could affect Surface Oncology’s future
results are included in the section titled “Risk Factors” in our
Annual Report on Form 10-K for the year ending December 31, 2019
and our Quarterly Report on Form 10-Q for the quarter ending March
31, 2020, both of which are available on the Security and Exchange
Commission’s website at www.sec.gov and Surface Oncology’s website
at www.surfaceoncology.com.
Additional information on potential risks will be made available
in other filings that Surface Oncology makes from time to time with
the Securities and Exchange Commission. In addition, any
forward-looking statements contained in this press release are
based on assumptions that Surface Oncology believes to be
reasonable as of this date. Except as required by law, Surface
Oncology assumes no obligation to update these forward-looking
statements, or to update the reasons if actual results differ
materially from those anticipated in the forward-looking
statements.
Contacts:Investors Matt
Lanematt@gilmartinir.com 617-901-7698
MediaTom Donovan tom@tenbridgecommunications.com
857-559-3397
Selected Financial Information:
(In thousands, except share and per share
amounts)
(Unaudited)
|
Three months ended June 30, |
|
Six months ended June 30, |
Statement of
Operations Items |
2020 |
|
2019 |
|
2020 |
|
2019 |
Collaboration revenue — related party |
$ |
— |
|
|
$ |
143 |
|
|
$ |
38,592 |
|
|
$ |
14,577 |
|
Operating expenses: |
|
|
|
|
|
|
|
Research and development |
9,548 |
|
|
13,236 |
|
|
20,836 |
|
|
27,545 |
|
General and administrative |
4,995 |
|
|
5,417 |
|
|
9,782 |
|
|
10,510 |
|
Total operating expenses |
14,543 |
|
|
18,653 |
|
|
30,618 |
|
|
38,055 |
|
Income (loss) from
operations |
(14,543 |
) |
|
(18,510 |
) |
|
7,974 |
|
|
(23,478 |
) |
Interest and other income,
net |
(264 |
) |
|
752 |
|
|
(211 |
) |
|
1,521 |
|
Net income (loss) |
(14,807 |
) |
|
(17,758 |
) |
|
7,763 |
|
|
(21,957 |
) |
Net income (loss) per share
attributable to common stockholders — basic |
$ |
(0.44 |
) |
|
$ |
(0.64 |
) |
|
$ |
0.25 |
|
|
$ |
(0.79 |
) |
Weighted average common shares
outstanding— basic |
33,418,412 |
|
|
27,845,136 |
|
|
30,697,779 |
|
|
27,835,471 |
|
Net income (loss) per share
attributable to common stockholders — diluted |
$ |
(0.44 |
) |
|
$ |
(0.64 |
) |
|
$ |
0.24 |
|
|
$ |
(0.79 |
) |
Weighted average common shares
outstanding— diluted |
33,418,412 |
|
|
27,845,136 |
|
|
33,763,452 |
|
|
27,835,471 |
|
Selected Balance Sheet
Items: |
June 30,2020 |
|
December 31,2019 |
Cash, cash equivalents and marketable securities |
$ |
112,539 |
|
|
$ |
105,161 |
|
Total assets |
154,526 |
|
|
131,693 |
|
Accounts payable and accrued
expenses |
5,780 |
|
|
11,396 |
|
Deferred revenue – related
party |
— |
|
|
38,592 |
|
Total stockholders’
equity |
97,671 |
|
|
56,666 |
|
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