Lyell Immunopharma, Inc. (Lyell) (Nasdaq: LYEL), a clinical‑stage
T-cell reprogramming company dedicated to developing curative cell
therapies for patients with solid tumors, today provided business
highlights and reported financial results for the third quarter of
2022.
“In the past year we have advanced two product
candidates into clinical development and have added LYL119, a
second-generation CAR T-cell product candidate, to our pipeline of
wholly owned novel cell therapies,” said Liz Homans, CEO of Lyell.
“As we continue to progress our pipeline, we are grateful for the
support of physicians, clinical site staff, patients and their
families and our dedicated and talented employees who enable our
mission,” said CEO Liz Homans. “Our strong financial position
allows us to execute against our long-range plans with a cash
runway into 2026, which takes us through important clinical
milestones. These expected milestones include initial clinical data
from both of our wholly owned product candidates, LYL797 and
LYL845.”
Recent Business Highlights
- Announced FDA
clearance of the IND for LYL845, a TIL product candidate enhanced
with Lyell’s novel epigenetic reprogramming technology for solid
tumors. LYL845 is an autologous TIL therapy enhanced with Lyell’s
Epi-R™ reprogramming technology designed to create polyclonal T
cell populations with properties of durable stemness and improved
function.
- The Phase 1 trial
is expected to initially enroll patients with relapsed and/or
refractory metastatic or locally advanced melanoma and subsequently
expand into non-small cell lung cancer and colorectal cancer.
- Initial data
presentation for LYL845 is expected in 2024.
- Announced the
presentation of five abstracts at the 2022 Society for
Immunotherapy of Cancer (SITC) Annual Meeting highlighting
preclinical data on Lyell’s product candidates and new genetic and
epigenetic reprogramming technologies. The abstracts showcase
compelling preclinical data underlying Lyell’s lead TIL product
candidate, LYL845, as well as preclinical data on new stackable
genetic and epigenetic reprogramming technologies being
incorporated into LYL119, its second-generation investigational
ROR1-targeting CAR T-cell product candidate.
- Presented the
first-in-human Phase 1 trial design for LYL797, Lyell’s
ROR1-targeted CAR T-cell therapy enhanced with genetic and
epigenetic reprogramming for the treatment of solid tumors, at the
European Society for Medical Oncology (ESMO) Congress 2022 in
Paris, France.
- Patient screening
in the Phase 1 trial of LYL797 was initiated in late March;
however, clinical site activation was initially slower than
anticipated. Lyell has undertaken several measures to accelerate
administrative site activation activities and has also increased
the number of sites that will participate in the trial. As a
result, although site activations are now progressing well,
enrollment has been slower than anticipated.
- Despite the
accelerated pace of site activations, in order to present a
meaningful dataset in terms of both the number of patients and
duration of response to therapy, the timing of presentation of
initial data is now expected to occur in the first half of
2024.
- Announced the
appointment of Rahsaan W. Thompson, as Chief Legal Officer. Mr.
Thompson is a biopharmaceutical industry veteran, with more than 20
years of experience with development stage and commercial
companies.
- Announced that GSK
informed Lyell that, as part of a number of strategic actions it is
taking, it is discontinuing its development of product candidates
targeting NY-ESO-1, including the second-generation product
candidates incorporating our genetic and epigenetic reprogramming
technologies (LYL132 and LYL331). The termination of the
collaboration agreement with Lyell will be effective December 24,
2022. Given the early stage of these second-generation programs,
the decision is not based on any clinical efficacy or safety data
from these programs.
Third Quarter
2022 Financial Results
Revenue
- Revenue was
approximately zero and $2.8 million for the three months ended
September 30, 2022 and 2021, respectively. No additional
research and development pursuant to the GSK Agreement was
performed in the third quarter of 2022, which drove a decrease in
revenue of $2.8 million.
GAAP and Non-GAAP Operating Expenses
- Lyell reported a
net loss of $70.3 million for the third quarter ended
September 30, 2022, compared to a net loss of $48.9 million
for the same period in 2021. Non-GAAP net loss, which excludes
non-cash stock-based compensation, non-cash expenses related to the
change in the estimated fair value of success payment liabilities
and non-cash impairment adjustment of other investments, was
$43.7 million for the third quarter ended September 30,
2022 compared to $35.7 million for the same period in 2021.
- Research and
development (R&D) expenses were $41.6 million for the third
quarter ended September 30, 2022, compared to $31.4 million
for the same period in 2021. The increase in R&D expenses was
primarily driven by increases in personnel and infrastructure costs
to support the expansion of our R&D and manufacturing
capabilities. Non‑GAAP R&D expenses, which exclude non-cash
stock-based compensation and non-cash expenses related to the
change in the estimated fair value of success payment liabilities
for the third quarter ended September 30, 2022, were
$34.7 million, compared to $28.7 million for the same
period in 2021.
- General and
administrative (G&A) expenses were $26.1 million for the third
quarter ended September 30, 2022, compared to $21.2 million
for the same period in 2021. The increase in G&A expenses was
primarily due to a $4.3 million increase in stock-based
compensation expense, primarily related to award modifications and
new awards granted. Non‑GAAP G&A expenses, which exclude
non-cash stock-based compensation, for the third quarter ended
September 30, 2022 were $11.4 million, compared to
$10.9 million for the same period in 2021. The increase in
non-GAAP G&A expenses was driven by public company operating
costs.
A discussion of non-GAAP financial measures,
including reconciliations of the most comparable GAAP measures to
non-GAAP financial measures, is presented below under “Non-GAAP
Financial Measures.”
Cash, cash equivalents and marketable
securities
Cash, cash equivalents and marketable securities
as of September 30, 2022 were $750.7 million, compared to
$898.3 million as of December 31, 2021. Certain clinical trial
expenses projected for 2022 are now expected to be incurred in
2023. As a result of expense timing, as well as diligent expense
management, Lyell believes that its cash, cash equivalents and
marketable securities balances will be sufficient to meet working
capital and capital expenditure needs into 2026.
About Lyell Immunopharma,
Inc.
Lyell is a clinical-stage T-cell reprogramming
company dedicated to developing curative cell therapies for
patients with solid tumors. The Company is advancing a pipeline of
therapies designed to address what it believes are the primary
barriers that limit consistent, reliable and curative responses to
adoptive T-cell therapy: T-cell exhaustion and lack of durable
stemness, which includes the ability to proliferate, persist and
self-renew, as well as generate differentiated effector cell
progenies to provide durable anti-tumor functionality. Lyell is
applying its proprietary ex vivo genetic and epigenetic
reprogramming technologies to address these barriers in order to
develop new medicines with improved, durable and potentially
curative clinical outcomes. Lyell is based in South San Francisco,
California with facilities in Seattle and Bothell, Washington. To
learn more, please visit www.lyell.com.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements expressed or implied
in this press release include, but are not limited to, statements
regarding: Lyell’s anticipated progress, business plans, business
strategy and clinical trials; Lyell advancing its pipeline or
growing its capabilities; the potential clinical benefits and
therapeutic potential of Lyell’s product candidates; the
sufficiency of Lyell’s cash resources to support advancement of
multiple product candidates through key clinical milestones and
execute against Lyell’s long-range plans; expected milestones;
Lyell’s belief that its cash resources will be sufficient to meet
working capital and capital expenditure needs into 2026; enrollment
expectations for the planned Phase 1 clinical trial of LYL845; the
timing of initial clinical data from Lyell’s planned Phase 1 trials
for LYL797 and LYL845; the potential of Lyell reprogramming
technologies to help resist cell-exhaustion; and other statements
that are not historical fact. These statements are based on Lyell’s
current plans, objectives, estimates, expectations and intentions,
are not guarantees of future performance 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, but are not limited to, risks and
uncertainties related to: the effects of the COVID-19 pandemic;
geopolitical instability; macroeconomic conditions; Lyell’s ability
to submit planned INDs or initiate or progress clinical trials on
the anticipated timelines, if at all; our lack of experience as a
company in enrolling, conducting or completing clinical trials;
Lyell’s ability to manufacture and supply its product candidates
for its clinical trials; the preclinical profiles of Lyell’s
product candidates not translating in clinical trials; the
potential for results from clinical trials to differ from
preclinical, early clinical, preliminary or expected results;
significant adverse events, toxicities or other undesirable side
effects associated with Lyell’s product candidates; the significant
uncertainty associated with Lyell’s product candidates ever
receiving any regulatory approvals; Lyell’s ability to obtain,
maintain or protect intellectual property rights related to its
product candidates; implementation of Lyell’s strategic plans for
its business and product candidates; the sufficiency of Lyell’s
capital resources and need for additional capital to achieve its
goals; and other risks, including those described under the heading
“Risk Factors” in Lyell’s most recently filed quarterly report on
Form 10-Q and subsequent filings with the SEC. Forward-looking
statements contained in this press release are made as of this
date, and Lyell undertakes no duty to update such information
except as required under applicable law.
Lyell Immunopharma, Inc.
Unaudited Selected Consolidated Financial
Data
(in thousands)
Statement of Operations Data:
| |
Three Months Ended September 30, 2022 |
|
Nine Months Ended September 30, 2022 |
| |
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
| Revenue |
$ |
3 |
|
|
$ |
2,755 |
|
|
$ |
36,297 |
|
|
$ |
7,828 |
|
| Operating expenses: |
|
|
|
|
|
|
|
|
Research and development |
|
41,607 |
|
|
|
31,433 |
|
|
|
121,156 |
|
|
|
119,408 |
|
|
General and administrative |
|
26,084 |
|
|
|
21,241 |
|
|
|
90,959 |
|
|
|
57,184 |
|
|
Other operating income, net |
|
(1,251 |
) |
|
|
(758 |
) |
|
|
(3,544 |
) |
|
|
(1,526 |
) |
|
Total operating expenses |
|
66,440 |
|
|
|
51,916 |
|
|
|
208,571 |
|
|
|
175,066 |
|
| Loss from operations |
|
(66,437 |
) |
|
|
(49,161 |
) |
|
|
(172,274 |
) |
|
|
(167,238 |
) |
|
Interest income, net |
|
2,251 |
|
|
|
270 |
|
|
|
3,600 |
|
|
|
842 |
|
|
Other (expense) income, net |
|
(1,068 |
) |
|
|
16 |
|
|
|
(1,047 |
) |
|
|
(117 |
) |
|
Impairment of other investments |
|
(5,000 |
) |
|
|
— |
|
|
|
(5,000 |
) |
|
|
— |
|
|
Total other (loss) income, net |
|
(3,817 |
) |
|
|
286 |
|
|
|
(2,447 |
) |
|
|
725 |
|
| Net loss |
$ |
(70,254 |
) |
|
$ |
(48,875 |
) |
|
$ |
(174,721 |
) |
|
$ |
(166,513 |
) |
Balance Sheet Data:
| |
September 30, 2022 |
|
December 31, 2021 |
| |
|
|
|
| Cash, cash equivalents and
marketable securities |
$ |
750,651 |
|
$ |
898,325 |
| Property and equipment,
net |
$ |
125,727 |
|
$ |
120,098 |
| Total assets |
$ |
977,269 |
|
$ |
1,127,406 |
| Total stockholders’
equity |
$ |
820,026 |
|
$ |
929,787 |
Non-GAAP Financial Measures
To supplement our financial results and guidance
presented in accordance with U.S. generally accepted accounting
principles (GAAP), we present non-GAAP net loss, non-GAAP R&D
expenses and non-GAAP G&A expenses. Non-GAAP net loss and
non-GAAP R&D expenses exclude non-cash stock-based compensation
expense and non-cash expenses related to the change in the
estimated fair value of success payment liabilities from GAAP net
loss and GAAP R&D expenses. Non-GAAP net loss further adjusts
for the income tax effect, if any, of the non-GAAP adjustments.
Non-GAAP G&A expenses exclude non-cash stock-based compensation
expense from GAAP G&A expenses. We believe that these non-GAAP
financial measures, when considered together with our financial
information prepared in accordance with GAAP, can enhance
investors’ and analysts’ ability to meaningfully compare our
results from period to period, and to identify operating trends in
our business. We have excluded stock-based compensation expense and
non-cash expenses related to the change in the estimated fair value
of success payment liabilities from our non-GAAP financial measures
because they are non-cash expenses that may vary significantly from
period to period as a result of changes not directly or immediately
related to the operational performance for the periods presented.
We also regularly use these non-GAAP financial measures internally
to understand, manage and evaluate our business and to make
operating decisions. These non-GAAP financial measures are in
addition to, and not a substitute for or superior to, measures of
financial performance prepared in accordance with GAAP. In
addition, these non-GAAP financial measures have no standardized
meaning prescribed by GAAP and are not prepared under any
comprehensive set of accounting rules or principles and, therefore,
have limits in their usefulness to investors. We encourage
investors to carefully consider our results under GAAP, as well as
our supplemental non-GAAP financial information, to more fully
understand our business.
Lyell Immunopharma, Inc.
Unaudited Reconciliation of GAAP to
Non-GAAP Net Loss
(in thousands)
| |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
| |
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
| Net loss - GAAP |
$ |
(70,254 |
) |
|
$ |
(48,875 |
) |
|
$ |
(174,721 |
) |
|
$ |
(166,513 |
) |
| Adjustments: |
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
19,123 |
|
|
|
13,042 |
|
|
|
63,561 |
|
|
|
41,023 |
|
|
Change in the estimated fair value of success payment
liabilities |
|
2,441 |
|
|
|
110 |
|
|
|
2,177 |
|
|
|
19,343 |
|
|
Impairment of other investments |
|
5,000 |
|
|
|
— |
|
|
|
5,000 |
|
|
|
— |
|
| Net loss - Non-GAAP(1) |
$ |
(43,690 |
) |
|
$ |
(35,723 |
) |
|
$ |
(103,983 |
) |
|
$ |
(106,147 |
) |
(1) There was no income tax effect related to
the adjustments made to calculate non-GAAP net loss because of the
full valuation allowance on our net U.S. deferred tax assets for
all periods presented.
Lyell Immunopharma, Inc.
Unaudited Reconciliation of GAAP to
Non-GAAP Research and Development Expenses
(in thousands)
| |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
| |
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
| Research and development -
GAAP |
$ |
41,607 |
|
|
$ |
31,433 |
|
|
$ |
121,156 |
|
|
$ |
119,408 |
|
| Adjustments: |
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
(4,442 |
) |
|
|
(2,673 |
) |
|
|
(12,401 |
) |
|
|
(12,615 |
) |
|
Change in the estimated fair value of success payment
liabilities |
|
(2,441 |
) |
|
|
(110 |
) |
|
|
(2,177 |
) |
|
|
(19,343 |
) |
| Research and development -
Non-GAAP |
$ |
34,724 |
|
|
$ |
28,650 |
|
|
$ |
106,578 |
|
|
$ |
87,450 |
|
Lyell Immunopharma, Inc.
Unaudited Reconciliation of GAAP to
Non-GAAP General and Administrative Expenses
(in thousands)
| |
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
| |
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
| General and administrative -
GAAP |
$ |
26,084 |
|
|
$ |
21,241 |
|
|
$ |
90,959 |
|
|
$ |
57,184 |
|
| Adjustments: |
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
(14,681 |
) |
|
|
(10,369 |
) |
|
|
(51,160 |
) |
|
|
(28,408 |
) |
| General and administrative -
Non-GAAP |
$ |
11,403 |
|
|
$ |
10,872 |
|
|
$ |
39,799 |
|
|
$ |
28,776 |
|
Contact:Ellen RoseSenior Vice
President, Communications and Investor Relationserose@lyell.com
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