SELLAS Life Sciences Group, Inc. (NASDAQ: SLS) (“SELLAS” or the
“Company”), a late-stage clinical biopharmaceutical company focused
on the development of novel therapies for a broad range of cancer
indications, today reported its financial results for the quarter
ended March 31, 2022 and provided a business update.
“SELLAS achieved several key milestones in the first four months
of 2022, including expanding our development pipeline and
strengthening our balance sheet,” said Angelos Stergiou, M.D.,
Sc.D. h.c., President and Chief Executive Officer of SELLAS. “We
entered into an exclusive license agreement with GenFleet
Therapeutics (Shanghai), Inc. (“GenFleet”) granting us exclusive
rights for the development and commercialization of GFH009, a
highly selective and potentially first and best in class small
molecule cyclin-dependent kinase 9 (“CDK9”) inhibitor, across all
therapeutic and diagnostic uses worldwide outside of Greater China.
We believe that GFH009 is a complementary strategic fit to our
overall clinical development plans and provides us with an
opportunity to further advance into the market for acute myeloid
leukemia (“AML”) therapeutics. GFH009 affords us the potential to
treat active AML disease while our lead clinical candidate,
galinpepimut-S (GPS), is potentially used in the maintenance
setting in AML. The in-license of GFH009 also provides us an
opportunity to address a very important pediatric market of soft
tissue sarcomas as well as other cancers.”
Dr. Stergiou added, “During the first quarter, we continued to
advance the Phase 3 REGAL trial for our lead asset, GPS and, in
April, we also launched an expanded access program for GPS in
response to multiple requests from physicians with which we hope to
potentially improve clinical outcomes for patients and their
families. Subsequent to the quarter, we fortified SELLAS’ balance
sheet with the closing of a public offering with gross proceeds of
$25 million. The funds position us to advance our clinical programs
for both GPS and GFH009. We are pleased by the progress we made
over the first quarter of 2022 and remain steadfast in our mission
to develop innovative treatments and improve the standard of care
available to patients. With GPS and GFH009, we now have two
significant clinical assets in our pipeline, with several
opportunities to develop and potentially commercialize, cancer
drugs that can prolong the lives of patients battling cancer.”
Pipeline Updates:
Galinpepimut-S (GPS)
- Expanded Access Program: In April 2022, the
Company launched a pre-approval access/expanded access program
(“EAP”) with SELLAS’ lead asset, GPS, for treating patients
suffering from AML. For more information on the GPS EAP, please
visit the PIPELINE page at www.sellaslifesciences.com.
- Phase 3 REGAL Study: SELLAS continued to
progress enrollment of patients and activation of additional sites
in the United States, Europe, and Asia in the first quarter of
2022. The Company believes that enrollment for the REGAL study will
be completed in late 2022 or early in the first quarter of 2023 and
the planned interim analysis will occur by the end of the first
half of 2023, provided that its statistical assumptions and
assumptions regarding the impact of COVID-19 on the operations of
clinical sites as well as the duration of the pandemic remain
unchanged.
- Phase 1/2 GPS Study in Combination with Merck’s
KEYTRUDA®: In February 2022, the Company completed
enrollment in the Phase 1/2 clinical trial of GPS in combination
with Merck’s anti-PD-1 therapy, KEYTRUDA® (pembrolizumab), in
second or third line Wilms Tumor-1 (WT1+) relapsed or refractory
metastatic ovarian cancer. Data from 15 patients is currently being
reviewed by SELLAS and Merck, with top-line results expected by
mid-2022 and a final data analysis for all evaluable patients
expected by the end of 2022.
- Phase I GPS Study in China: In March 2022, an
IND application to initiate the first clinical trial in China for
GPS was approved by China’s National Medical Products
Administration (“NMPA”), which triggered a milestone payment of $1
million received by the Company in May 2022. The IND, for a small
Phase 1 clinical trial investigating safety, was submitted by
SELLAS’ partner in China, 3D Medicines Inc. (“3D Medicines”), with
3D Medicines expecting to initiate the trial by mid-2022. 3D
Medicines’ current clinical development plan provides for
initiation of a Phase 2 clinical trial following receipt of
satisfactory safety data from the Phase 1 clinical trial; the
initiation of the Phase 2 clinical trial will also trigger a
milestone payment to SELLAS.
- New Patent Allowance: In February 2022, the
U.S. Patent and Trademark Office issued a Notice of Allowance for a
patent application covering certain WT1-targeting peptides, in
combination with other molecules such as other peptides and
immunomodulating compounds, useful for treatment of WT1-expressing
cancers. The patent application covers WT1-targeting peptides
linked to other molecules and is expected to be granted later this
year. The patent will have a term extending to at least 2026. This
patent complements the Company’s existing composition of matter
patents covering GPS peptides which expire in 2033 not including
any potential extensions.
GFH009
- In-License: On March 31, 2022 the Company
announced it had entered into an exclusive license agreement with
GenFleet Therapeutics (Shanghai), Inc. (“GenFleet”), that grants
rights to SELLAS for the development and commercialization of
GFH009, a highly selective small molecule CDK9 inhibitor, across
all therapeutic and diagnostic uses worldwide outside of Greater
China (mainland China, Hong Kong, Macau and Taiwan). CDK9 activity
has shown a negative correlation with overall survival in a number
of cancer types, including hematologic cancers, such as AML and
lymphomas, as well as solid cancers, such as osteosarcoma,
pediatric soft tissue sarcomas, and melanoma, and endometrial,
lung, prostate, breast and ovarian cancer.
- Ongoing Phase 1 Clinical Trial: In April 2022,
SELLAS announced that initial data from the first four dose levels
of the ongoing Phase 1 dose-escalating clinical trial of GFH009
show a significant anti-leukemic effect at the 9mg and 15mg dose
levels given twice a week in AML patients resistant to
standard-of-care treatments, with two patients refractory to, or
relapsed after, venetoclax treatment experiencing greater or equal
to a 50 percent decrease in bone marrow blasts following GFH009
monotherapy. There have been no dose-limiting toxicities, including
no grade 3/4 neutropenia (an abnormally low count of a type of
white blood cells), in the first four dose levels (2.5mg, 4.5mg,
9mg and 15 mg) with the twice-weekly GFH009 dosing. The first AML
patient has been enrolled in the fifth dose level (22.5mg twice a
week) cohort. The last planned dose level in this clinical trial is
30mg.
Corporate Highlights:
- Underwritten Public Offering: On April 5,
2022, the Company consummated an underwritten public offering
providing gross proceeds to the Company of $25.0 million, before
deducting underwriting discounts and commissions and offering
expenses.
- Bolstered Leadership Team: In March 2022,
SELLAS appointed Robert Francomano as Chief Commercial Officer. In
January 2022, the Company promoted John Burns to Senior Vice
President, Finance, and Chief Accounting Officer.
- Settlement of Legacy Galena Litigations: In
February 2022, SELLAS received the final court approval of the
settlement of securities litigation relating to the Company’s
predecessor, Galena. This marked the end to all litigation related
to activities of Galena.
Financial Results for the First Quarter
2022:
Licensing revenue: Licensing revenue for the
first quarter of 2022 was $1.0 million, as compared to $5.7 million
for the same period in 2021. Licensing revenue in the first quarter
of 2022 was related to China’s NMPA approval of an IND application
by 3D Medicines and licensing revenue during the first quarter of
2021 was related to the initial transaction price of the license
agreement with 3D Medicines, which was recognized over a period of
time.
R&D Expenses: Research and development
expenses for the first quarter of 2022 were $4.6 million, as
compared to $4.3 million for the same period in 2021. The increase
was primarily due to an increase in clinical trial expenses for the
ongoing Phase 3 clinical trial of GPS in AML and personnel related
expenses due to increased headcount, partially offset by a decrease
in manufacturing expenses due to the timing of the manufacture of
registration batches of GPS in the prior year.
Acquired In-Process Research and Development:
Acquired in-process research and development for the first quarter
2022 was $10.0 million, related to the in-licensing of GFH009.
There was no acquired in-process research and development during
the first quarter of 2021.
G&A Expenses: General and administrative
expenses for the first quarter of 2022 were $3.0 million, as
compared to $3.6 million for the same period in 2022. The decrease
was primarily due to a decrease in amortization expense associated
with the capitalized contract acquisition costs of the 3D Medicines
license agreement and a decrease in professional service fees,
partially offset by an increase in personnel related expenses due
to increased headcount.
Net Loss: Net loss was $16.7 million for the
first quarter of 2022, or a basic and diluted loss per share of
$1.05, as compared to a net loss of $2.4 million for the same
period in 2021, or a basic and diluted loss per share of $0.16.
Cash Position: As of March 31, 2022, cash and
cash equivalents totaled approximately $14.3 million. Subsequent to
March 31, 2022, the Company consummated an underwritten public
offering providing gross proceeds to the Company of $25.0 million,
before deducting underwriting discounts and commissions and
offering expenses, and received a $1.0 million milestone payment
from 3D Medicines.About SELLAS Life Sciences Group,
Inc. SELLAS Life Sciences Group, Inc. (NASDAQ: SLS) is a
late-stage clinical biopharmaceutical company focused on the
development of novel therapeutics for a broad range of cancer
indications. SELLAS’ lead product candidate, GPS, is licensed from
Memorial Sloan Kettering Cancer Center and targets the WT1 protein,
which is present in an array of tumor types. GPS has potential as a
monotherapy or in combination with other therapies to address a
broad spectrum of hematologic malignancies and solid tumor
indications. The Company is also developing GFH009, a small
molecule, highly selective CDK9 inhibitor, which is licensed from
GenFleet Therapeutics (Shanghai), Inc., for all therapeutic and
diagnostic uses in the world outside of Greater China.
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
clinical development of GPS and GFH009 for various cancer
indications, including the timing of commencement and completion of
clinical trials therefor, the potential for GPS and GFH009 as drug
development candidates for various cancer indications, alone and in
combination with other therapeutic agents, the timing for the
completion of enrollment for the GPS REGAL Phase 3 clinical trial,
the timing for analyses and reporting of data for GPS, the
potential for regulatory approval and commercialization of GPS, and
the potential for additional milestone payments under the license
agreement with 3D Medicines. 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 COVID-19 pandemic and its impact on the Company’s clinical
plans, risks and uncertainties associated with immune-oncology
product development and clinical success thereof, the uncertainty
of regulatory approval, 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
31, 2022 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 ContactAllison SossKCSA Strategic
CommunicationsEmail: SELLAS@kcsa.com Phone: 212.896.1267
Media ContactRaquel Cona / Michaela FawcettKCSA
Strategic CommunicationsEmail: SELLAS@kcsa.com Phone:
212.896.1276
SELLAS LIFE SCIENCES GROUP,
INC.CONSOLIDATED STATEMENTS OF
OPERATIONS(Amounts in thousands, except share and
per share data)(Unaudited)
|
|
Three Months Ended March 31, |
|
|
|
2022 |
|
|
|
2021 |
|
Licensing revenue |
|
$ |
1,000 |
|
|
$ |
5,700 |
|
Operating expenses: |
|
|
|
|
Cost of licensing revenue |
|
|
100 |
|
|
|
100 |
|
Research and development |
|
|
4,611 |
|
|
|
4,284 |
|
Acquired in-process research and development |
|
|
10,000 |
|
|
|
— |
|
General and administrative |
|
|
3,024 |
|
|
|
3,561 |
|
Total operating expenses |
|
|
17,735 |
|
|
|
7,945 |
|
Operating loss |
|
|
(16,735 |
) |
|
|
(2,245 |
) |
Non-operating income
(expense): |
|
|
|
|
Change in fair value of warrant liability |
|
|
(11 |
) |
|
|
(31 |
) |
Change in fair value of contingent consideration |
|
|
— |
|
|
|
(129 |
) |
Interest income |
|
|
2 |
|
|
|
2 |
|
Total non-operating expense |
|
|
(9 |
) |
|
|
(158 |
) |
Net loss |
|
$ |
(16,744 |
) |
|
$ |
(2,403 |
) |
|
|
|
|
|
Per share information: |
|
|
|
|
Net loss per share, basic and
diluted |
|
$ |
(1.05 |
) |
|
$ |
(0.16 |
) |
Weighted average shares
outstanding, basic and diluted |
|
|
15,897,479 |
|
|
|
14,877,317 |
|
SELLAS LIFE SCIENCES GROUP,
INC.CONSOLIDATED BALANCE
SHEETS(Amounts in thousands, except share and per
share data)(Unaudited)
|
March 31, 2022 |
|
December 31, 2021 |
|
|
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
14,252 |
|
|
$ |
21,355 |
|
Restricted cash and cash equivalents |
|
100 |
|
|
|
100 |
|
Accounts receivable |
|
1,000 |
|
|
|
— |
|
Prepaid expenses and other current assets |
|
2,487 |
|
|
|
1,589 |
|
Total current assets |
|
17,839 |
|
|
|
23,044 |
|
Operating lease right-of-use
assets |
|
1,127 |
|
|
|
723 |
|
Goodwill |
|
1,914 |
|
|
|
1,914 |
|
Deposits and other assets |
|
554 |
|
|
|
594 |
|
Total assets |
$ |
21,434 |
|
|
$ |
26,275 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
2,842 |
|
|
$ |
2,144 |
|
Accrued expense and other current liabilities |
|
3,012 |
|
|
|
2,640 |
|
Operating lease liabilities |
|
325 |
|
|
|
198 |
|
Acquired in-process research and development payable |
|
4,500 |
|
|
|
— |
|
Total current liabilities |
|
10,679 |
|
|
|
4,982 |
|
Acquired in-process research
and development payable, non-current |
|
5,500 |
|
|
|
— |
|
Operating lease liabilities,
non-current |
|
883 |
|
|
|
610 |
|
Warrant liability |
|
51 |
|
|
|
40 |
|
Contingent consideration |
|
296 |
|
|
|
296 |
|
Total liabilities |
|
17,409 |
|
|
|
5,928 |
|
Commitments and contingencies
(Note 7) |
|
|
|
Stockholders’ equity: |
|
|
|
Preferred stock, $0.0001 par
value; 5,000,000 shares authorized; Series A convertible preferred
stock, 17,500 shares designated; no shares issued and outstanding
at March 31, 2022 and December 31, 2021 |
|
— |
|
|
|
— |
|
Common stock, $0.0001 par
value; 350,000,000 shares authorized, 15,905,999 and 15,895,637
shares issued and outstanding at March 31, 2022 and December 31,
2021, respectively |
|
2 |
|
|
|
2 |
|
Additional paid-in capital |
|
159,370 |
|
|
|
158,948 |
|
Accumulated deficit |
|
(155,347 |
) |
|
|
(138,603 |
) |
Total stockholders’ equity |
|
4,025 |
|
|
|
20,347 |
|
Total liabilities and stockholders’ equity |
$ |
21,434 |
|
|
$ |
26,275 |
|
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