Cyclerion Therapeutics Reports Third Quarter 2020 Financial Results and Recent Corporate Updates
November 05 2020 - 7:00AM
Cyclerion Therapeutics, Inc. (Nasdaq: CYCN), a clinical-stage
biopharmaceutical company developing innovative medicines for
people with serious diseases of the central nervous system (CNS),
reported financial results for the third quarter ended September
30, 2020 and provided general corporate and pipeline updates.
“We are highly encouraged by the data from our IW-6463
translational pharmacology study showing robust and consistent
positive effects on multiple measures of brain neurophysiology that
are associated with age-related cognitive decline and
neurodegenerative diseases,” said Peter Hecht, Ph.D., Chief
Executive Officer of Cyclerion. “IW-6463 is a promising new
approach for CNS diseases that have very limited therapeutic
options today. Building on the exciting IW-6463 translational
pharmacology study results and leveraging our team’s neuroscience
expertise, the Company will concentrate on developing meaningful
treatments for serious CNS diseases. Our immediate priority is to
rapidly and efficiently further assess the clinical profile of
IW-6463, and we look forward to initiating enrollment in our MELAS
study this quarter and in our ADv study in 2021.”
Recent Program and Business Updates
- IW-6463 Program
Update: Cyclerion announced promising results from its
Phase 1 translational pharmacology study of IW-6463, the first
soluble guanylate cyclase (sGC) stimulator in clinical development
for CNS disorders. Treatment with IW-6463 in the 15-day 24-subject
crossover study confirmed and extended results seen in the earlier
Phase 1 study: once daily oral treatment demonstrated
blood-brain-barrier penetration, desired CNS exposure levels,
target engagement and showed IW-6463 to be safe and generally
well-tolerated. In this study, subjects receiving IW-6463 showed
improvements in several neurophysiological and objective
performance measures that are associated with age-related cognitive
decline and neurodegenerative diseases. Effects on cerebral blood
flow and markers of bioenergetics were not observed in this study
of healthy elderly subjects.These results support the ongoing
development of IW-6463 in serious CNS diseases. Cyclerion expects
to begin enrolling its Phase 2 clinical trial in patients with
Mitochondrial Encephalomyopathy, Lactic Acidosis, and Stroke-like
episodes (MELAS) this quarter. The Company will use the findings of
the translational pharmacology study, in addition to observations
from the previous Phase 1 study of 110 healthy subjects, to inform
further clinical development activities, including the initiation
of a planned Phase 2 clinical trial in Alzheimer’s disease with
vascular pathology (ADv) in 2021, as well as to explore other
potential indications.In July, the Company announced that it has
been awarded a grant from the Alzheimer's Association’s Part the
Cloud-Gates Partnership Grant Program. This award will support the
Company’s upcoming Phase 2 trial of IW-6463 in ADv. The award
provides Cyclerion with $2 million of funding over the next 2
years.
- Sickle Cell
Program Update: The Company announced top-line
results from its STRONG-SCD study of olinciguat, an
investigational, orally-administered, once daily, vascular sGC
stimulator for the potential treatment of sickle cell disease
(SCD). Olinciguat was generally well tolerated across all doses.
Results did not demonstrate adequate activity to support further
internal clinical development. Cyclerion intends to complete its
analysis of the study results and present or publish them in a
future medical forum.
- Praliciguat
Update: The Company is working to out-license rights to
praliciguat, its orally administered, once-daily systemic sGC
stimulator, and has expanded to discussions beyond treatment of
cardiometabolic disorders to include additional indications where
sGC stimulators have demonstrated efficacy.
- Financing: On July
29, Cyclerion announced a private equity investment of $24 million.
On September 3, 2020, the Company entered into a Sales Agreement
with Jefferies LLC with respect to an at-the-market offering (ATM
Offering) which allows the sale of up to $50M of shares from time
to time over the next three years at the open market price. As of
September 30, 2020, no shares have been issued or sold under the
ATM Offering.
- Strategic Update and Organization
Restructuring: Consistent with its previously announced
intent to focus on developing treatments for serious CNS diseases,
Cyclerion’s investments will be directed to fund its current CNS
priorities, including the upcoming MELAS study, the planned ADv
study and further characterization of IW-6463 pharmacology. The
Company will revamp its organization beginning immediately to align
with these priorities. The Company expects to take an aggregate
charge for one-time employee-related costs of approximately $5
million that is expected to be incurred primarily in Q4 2020 and
realize annual cash savings of approximately $10 million. The
Company also intends to exit its current laboratory and office
facilities in early 2021, from which it expects annual cash savings
of about $10 million. These and other spending reductions are
expected to lower the Company’s average quarterly cash use in 2021
by about 50% from the Q3 2020 level of approximately $15 million.
The Company anticipates that its current cash will be sufficient to
fund its current CNS priorities, including the ongoing MELAS study,
the planned ADv study and further characterization of IW-6463
pharmacology.
- Transition of President and Chief Scientific
Officer: Dr. Mark Currie, Cyclerion’s President and Chief
Scientific Officer (CSO), will transition at year end to become a
senior advisor. He will continue to assist the Company on
scientific and strategic matters related to the development of the
CNS portfolio. Dr. Andreas Busch, Chief Innovation Officer, will
effective immediately assume Dr. Currie’s CSO responsibilities
while Dr. Currie continues as President through year end.
Third Quarter 2020 Financial Results
- Cash
Position: Cash, cash equivalents, and restricted cash
balance on September 30, 2020 was approximately $71 million,
as compared to approximately $61 million on June 30,
2020.
- Research &
Development Expenses: Research and development
expenses were approximately $13.7 million for the third
quarter of 2020, as compared to approximately $22.3 million for the
third quarter of 2019. The decrease of approximately $8.6 million
was driven by a decrease of approximately $3.3 million in salaries
and other employee-related expenses primarily due to lower average
headcount, a decrease of approximately $2.0 million of facilities
and operating costs allocated to research and development primarily
from our reduced lease footprint and a decrease of approximately
$3.3 million in external research costs, primarily related to the
completion of praliciguat trials in the prior year.
- General and
Administrative Expenses: General and administrative
expenses were approximately $8.0 million for the third
quarter of 2020, as compared to approximately $7.1
million for the third quarter of 2019. The increase was
primarily due to professional fees supporting our recent financing
activities, partially offset by a net decrease in employee-related
and operating expenses due to lower average headcount.
- Net
Loss: Net loss was approximately $18.8
million for the third quarter of 2020, as compared
to $27.3 million for the third quarter of 2019.
About IW-6463
IW-6463 is the first CNS-penetrant sGC stimulator to be
developed as a symptomatic and potentially disease modifying
therapy for serious CNS diseases. Nitric oxide (NO) is one of
several fundamental neurotransmitters, but it has yet to be
leveraged for its full CNS therapeutic potential. IW-6463
stimulates sGC, a signaling enzyme that responds to the presence of
NO, to enhance the body’s natural ability to produce cyclic
guanosine monophosphate (cGMP), an important signaling molecule. An
impaired NO-sGC-cGMP signaling pathway is believed to play an
important role in the pathogenesis of neurodegenerative diseases
and is critical to basic neuronal functions. Agents that stimulate
sGC to produce cGMP may compensate for deficient NO signaling.
About Cyclerion Therapeutics
Cyclerion Therapeutics is a clinical-stage biopharmaceutical
company focused on discovering, developing and commercializing
innovative medicines for people with serious diseases of the
central nervous system (CNS). Cyclerion’s lead program is IW-6463
is a pioneering CNS-penetrant sGC stimulator in clinical
development for Mitochondrial Encephalomyopathy, Lactic Acidosis
and Stroke-like episodes (MELAS) and Alzheimer's Disease with
Vascular pathology (ADv).
For more information about Cyclerion, please visit
https://www.cyclerion.com/ and follow us on Twitter (@Cyclerion)
and LinkedIn (www.linkedin.com/company/cyclerion).
Forward Looking StatementThis press release
contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended. Our
forward-looking statements are based on current beliefs and
expectations of our management team that involve risks, potential
changes in circumstances, assumptions, and uncertainties, including
statements about the results and conduct of our clinical trials;
our interpretation of the data from the clinical trials; the
clinical potential of our molecules; the anticipated timing of our
planned clinical trials; our future business focus; the business
and operations of Cyclerion; and our future financial performance
and expense levels. We may, in some cases use terms such as
“predicts,” “believes,” “potential,” “continue,” “anticipates,”
“estimates,” “expects,” “plans,” “intends,” “may,” “could,”
“might,” “likely,” “will,” “should” or other words that convey
uncertainty of the future events or outcomes to identify these
forward-looking statements. Each forward-looking statement is
subject to risks and uncertainties that could cause actual results
to differ materially from those expressed or implied in such
statement. Applicable risks and uncertainties include the risks
listed under the heading “Risk Factors” and elsewhere in our 2019
Form 10-K filed on March 12, 2020, and in Cyclerion’s subsequent
SEC filings, including the Form 10-Qs filed on May 4, 2020, August
3, 2020 and November 5, 2020. Investors are cautioned not to place
undue reliance on these forward-looking statements. These
forward-looking statements (except as otherwise noted) speak only
as of the date of this press release, and Cyclerion undertakes no
obligation to update these forward-looking statements, except as
required by law.
InvestorsCarlo Tanzi, Ph.D.Kendall Investor
Relationsctanzi@kendallir.com
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