Fate Therapeutics, Inc. (NASDAQ: FATE), a clinical-stage
biopharmaceutical company dedicated to bringing a first-in-class
pipeline of induced pluripotent stem cell (iPSC)-derived cellular
immunotherapies to patients with cancer and autoimmune disorders,
today reported business highlights and financial results for the
first quarter ended March 31, 2023.
“Over the first months of 2023, we have sharpened our clinical
focus and significantly reduced our operating expenses, creating
the necessary cash runway to achieve key milestones across our
multiplexed-engineered CAR NK and CAR T-cell pipeline. We sincerely
thank our employees whose patience and perseverance have allowed us
to emerge through this transition period with a renewed sense of
energy, commitment, and drive to bring first-in-class, iPSC-derived
cellular immunotherapies to patients with cancer and autoimmune
disorders,” said Scott Wolchko, President and Chief Executive
Officer of Fate Therapeutics. “We are now well-positioned to
clinically assess higher therapeutic exposures for our FT576
BCMA-targeted CAR NK cell program in multiple myeloma and our FT819
CD19-targeted CAR T-cell program in B-cell malignancies. In
addition, we aim to bring our FT522 CD19-targeted CAR NK cell
program, which incorporates our proprietary ADR technology designed
to enhance NK cell potency, extend functional persistence, and
resist host immune cell rejection, into clinical development in the
second half of 2023 for B-cell lymphoma, and intend to expand its
clinical reach to include severe autoimmune disorders. Finally, we
are excited to be jointly developing our clinical strategy with ONO
Pharmaceutical for FT825/ONO-8250, our HER2-targeted CAR T-cell
collaboration program for solid tumors for which we plan to submit
an IND application in the second half of 2023.”
NK Cell Programs
- FT576 BCMA-targeted CAR NK Cell
Program Accruing Patients in Multi-dose Escalation Cohorts for
Multiple Myeloma. The Company’s Phase 1 study of FT576,
its multiplexed-engineered, BCMA-targeted chimeric antigen receptor
(CAR) NK cell product candidate for relapsed / refractory multiple
myeloma, is currently enrolling two-dose treatment cohorts as
monotherapy and in combination with CD38-targeted monoclonal
antibody (mAb) therapy at 300 million cells per dose. Upon
clearance of the current treatment cohorts, the Company plans to
open and assess three-dose treatment cohorts starting at 1 billion
cells per dose. At the 2022 American Society of Hematology (ASH)
Annual Meeting in December, the Company presented interim Phase 1
clinical data from nine heavily pre-treated patients in the
single-dose cohorts, which showed encouraging clinical evidence of
BCMA-targeted activity and a favorable safety profile indicating
the potential for administration in the outpatient setting.
Translational data from the CD38-targeted mAb combination regimen
showed rapid and selective depletion of CD38-positive patient
immune cells in the peripheral blood and bone marrow that extended
through the first month of therapy, indicating that the regimen may
uniquely serve to attenuate reconstitution of activated T cells,
extend functional persistence of FT576, and enable dual-antigen
targeting of myeloma cells.
- Initiation of Clinical
Assessment of FT522 ADR-armed, CD19-targeted CAR NK Cell Program
Anticipated in 2H23. FT522 is the Company’s first product
candidate to incorporate its proprietary alloimmune defense
receptor (ADR) technology, which has been shown in preclinical
studies to increase NK cell potency, enhance functional
persistence, and confer resistance to host immune cell
allo-reactivity. The Company has recently submitted an
Investigational New Drug (IND) application to the U.S. Food and
Drug Administration (FDA) to investigate the safety and activity of
FT522 in combination with CD20-targeted mAb therapy in patients
with B-cell lymphoma, including without prior administration of
intensive conditioning chemotherapy. In addition, the Company is
currently conducting preclinical studies to support clinical
assessment of FT522 in autoimmune disease, including in combination
with CD20- and CD38-targeted mAb therapy, to selectively target and
durably deplete pathogenic B cells, plasma cells, and auto-reactive
T cells.
T-cell Programs
- First-of-kind FT819 Program
Advancing in Single-dose Escalation Cohorts for B-cell
Malignancies. The Company’s landmark Phase 1 clinical
trial of FT819, which is the first-ever clinical investigation of a
T-cell product candidate manufactured from a clonal master iPSC
line, is currently enrolling patients in single-dose escalation
cohorts at 540 million cells in B-cell lymphoma and at 180 million
cells in chronic lymphocytic leukemia. At the 2022 ASH Annual
Meeting, the Company presented interim Phase 1 clinical data from
eight patients with relapsed / refractory aggressive large B-cell
lymphoma treated with a single dose of FT819 ranging from 90
million cells to 360 million cells, which demonstrated a favorable
safety profile and objective responses including in patients who
were not eligible for or had previously failed autologous
CD19-targeted CAR T-cell therapy. FT819 incorporates several novel
features including the integration of a novel CD19-targeted 1XX CAR
construct into the T-cell receptor alpha constant (TRAC) locus,
which is intended to promote uniform CAR expression, enhance T-cell
potency, and prevent graft-versus-host disease.
- 2023 IND Submission Planned for
HER2-targeted CAR T-cell Program for Solid Tumors. Under
the Company’s collaboration with ONO Pharmaceutical Co., Ltd.
(ONO), the companies are co-developing FT825/ONO-8250, an
iPSC-derived CAR T-cell product candidate targeting human epidermal
growth factor receptor 2 (HER2)-expressing solid tumors.
IND-enabling activities for FT825/ONO-8250 are currently ongoing,
and the Company plans to submit an IND application to the FDA in
2023 to jointly conduct with ONO a Phase 1 study for the treatment
of patients with HER2-positive solid tumors. The
multiplexed-engineered, iPSC-derived CAR T-cell product candidate
incorporates seven novel synthetic controls designed to enhance
effector cell function and overcome unique challenges in treating
solid tumors, including a novel HER2-targeted binding domain with a
differentiated targeting profile, a synthetic CXCR2 receptor to
promote cell trafficking, a synthetic TGFβ receptor to redirect
immunosuppressive signals in the tumor microenvironment, and a
synthetic interleukin-7 receptor fusion protein to induce T-cell
activation.
Strategic Pipeline Prioritization & Corporate
RestructuringDuring the first quarter of 2023, in
connection with the termination of its collaboration with Janssen
Biotech, Inc. (Janssen), the Company discontinued all collaboration
activities, including withdrawing an IND application previously
allowed by the FDA for a first collaboration product for the
treatment of B-cell lymphoma. In addition, following a strategic
review of its wholly-owned iPSC-derived NK cell and T-cell
programs, the Company focused its operations on advancing its most
innovative and differentiated programs and initiated the
discontinuation of its FT516, FT596, FT538, and FT536 NK cell
product candidates. As part of its corporate restructuring, the
Company reduced its workforce to approximately 220 employees.
First Quarter 2023 Financial Results & 2023
Guidance
- Cash & Investment
Position: Cash, cash equivalents and investments as of
March 31, 2023 were $412.8 million. In addition, as of March 31,
2023, cash receivables from collaborations were $13.5 million. The
Company expects its cash, cash equivalents, and investments to
exceed $300 million at year-end 2023.
- Total Revenue: Revenue
was $59.0 million for the first quarter of 2023, of which $52.3
million was associated with the termination of its collaboration
with Janssen and $6.7 million was derived from its ongoing
collaboration with ONO. Under the ONO collaboration, a one-time
amount of $6.2 million was recorded as revenue for the first
quarter of 2023 associated with the Company’s conduct of
IND-enabling activities for FT825/ONO-8250, for which ONO exercised
its development and commercialization option in November 2022. For
each of the remaining three quarters of 2023, the Company expects
to recognize approximately $0.8 million in revenue under the ONO
collaboration in connection with its conduct of preclinical
development activities for a second collaboration candidate
targeting an undisclosed solid tumor antigen.
- Total Operating
Expenses: For the first quarter of 2023, GAAP operating
expenses were $87.6 million, including research and development
expenses of $65.6 million and general and administrative expenses
of $21.9 million. Such amounts included $11.0 million of non-cash
stock-based compensation expense and a one-time charge of $12.9
million for severance and other employee termination-related costs
associated with the Company’s corporate restructuring. For the full
year ending December 31, 2023, the Company expects its GAAP
operating expenses to be between $265 million to $285 million.
- Shares Outstanding:
Common shares outstanding were 98.2 million, and preferred shares
outstanding were 2.8 million, as of March 31, 2023. Each preferred
share is convertible into five common shares.
Today's Conference Call and WebcastThe Company
will conduct a conference call today, Wednesday, May 3, 2023 at
5:00 p.m. ET to review financial and operating results for the
quarter ended March 31, 2023. In order to participate in the
conference call, please register using the conference link
here. The live webcast can be accessed under
"Events & Presentations" in the Investors section of the
Company's website at www.fatetherapeutics.com. The archived webcast
will be available on the Company's website beginning approximately
two hours after the event.
About Fate Therapeutics’ iPSC Product
PlatformThe Company’s proprietary induced pluripotent stem
cell (iPSC) product platform enables mass production of
off-the-shelf, multiplexed-engineered cell products that are
selectively designed, incorporate novel synthetic controls of cell
function, and are intended to deliver multiple mechanisms of
therapeutic importance to patients. Human iPSCs possess the unique
dual properties of unlimited self-renewal and differentiation
potential into all cell types of the body. The Company’s platform
combines multiplexed engineering and single-cell selection of human
iPSCs to create clonal master iPSC lines. Analogous to master cell
lines used to mass produce biopharmaceutical drug products such as
monoclonal antibodies, the Company utilizes its clonal master iPSC
lines as a renewable cell source to manufacture
multiplexed-engineered cell products which are well-defined and
uniform in composition, can be stored in inventory for
off-the-shelf availability, can be combined and administered with
other therapies, and can potentially reach a broad patient
population. As a result, the Company’s platform is uniquely
designed to overcome numerous limitations associated with the
manufacture of cell therapies using patient- or donor-sourced
cells. Fate Therapeutics’ iPSC product platform is supported by an
intellectual property portfolio of over 400 issued patents and 450
pending patent applications.
About FT576FT576 is an investigational,
universal, off-the-shelf natural killer (NK) cell cancer
immunotherapy derived from a clonal master induced pluripotent stem
cell (iPSC) line engineered with four functional components: a
proprietary chimeric antigen receptor (CAR) optimized for NK cell
biology that targets B-cell maturation antigen (BCMA); a novel
high-affinity 158V, non-cleavable CD16 (hnCD16) Fc receptor, which
has been modified to prevent its down-regulation and to enhance its
binding to tumor-targeting antibodies; an IL-15 receptor fusion
(IL-15RF) that augments NK cell activity; and the deletion of the
CD38 gene (CD38KO), which promotes persistence and function in high
oxidative stress environments. In preclinical studies, FT576 has
demonstrated that the high-avidity binding of the BCMA-targeted CAR
construct enables sustained tumor control against various multiple
myeloma cell lines, including in long-term in vivo xenograft mouse
models. Additionally, in combination with daratumumab, FT576 has
shown complete tumor clearance and improved survival compared to
primary BCMA-targeted CAR T cells in a disseminated xenograft model
of multiple myeloma. FT576 is being investigated in a multicenter
Phase 1 clinical trial for the treatment of relapsed / refractory
multiple myeloma as a monotherapy and in combination with
daratumumab (NCT05182073).
About FT819FT819 is an investigational,
universal, off-the-shelf, T-cell receptor (TCR)-less CD19 chimeric
antigen receptor (CAR) T-cell cancer immunotherapy derived from a
clonal master induced pluripotent stem cell (iPSC) line, which is
engineered with the following features designed to improve the
safety and efficacy of CAR19 T-cell therapy: a novel 1XX CAR
signaling domain, which has been shown to extend T-cell effector
function without eliciting exhaustion; integration of the CAR19
transgene directly into the T-cell receptor alpha constant (TRAC)
locus, which has been shown to promote uniform CAR19 expression and
enhanced T-cell potency; and complete bi-allelic disruption of TCR
expression for the prevention of graft-versus-host disease. FT819
demonstrated antigen-specific cytolytic activity in vitro against
CD19-expressing leukemia and lymphoma cell lines comparable to that
of primary CAR T cells, and persisted and maintained tumor
clearance in the bone marrow in an in vivo disseminated xenograft
model of lymphoblastic leukemia. FT819 is being investigated in a
multicenter Phase 1 clinical trial for the treatment of relapsed /
refractory B-cell malignancies, including B-cell lymphoma, chronic
lymphocytic leukemia, and acute lymphoblastic leukemia
(NCT04629729).
About Fate Therapeutics, Inc.Fate Therapeutics
is a clinical-stage biopharmaceutical company dedicated to bringing
a first-in-class pipeline of induced pluripotent stem cell
(iPSC)-derived cellular immunotherapies to patients with cancer and
autoimmune disorders. Using its proprietary iPSC product platform,
the Company has established a leadership position in creating
multiplexed-engineered iPSC lines and in the manufacture and
clinical development of off-the-shelf, iPSC-derived cell products.
The Company’s effector cell pipeline includes
multiplexed-engineered, iPSC-derived natural killer (NK) cell and
T-cell product candidates, which incorporate novel synthetic
controls of cell function, such as chimeric antigen receptors
(CARs) to target tumor-associated antigens, and are intended to
deliver multiple mechanisms of therapeutic importance to patients
including in combination with well-established cancer therapies.
Fate Therapeutics is headquartered in San Diego, CA. For more
information, please visit www.fatetherapeutics.com.
Forward-Looking StatementsThis release contains
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 including statements
regarding the progress of and plans related to the Company's
product candidates, clinical studies and preclinical research and
development programs, the therapeutic and market potential of the
Company’s product candidates, the Company’s clinical and product
development strategy, the Company’s plans to submit IND
applications for its FT522 CD19-targeted CAR NK cell program and
its FT825/ONO-8250 HER2-targeted CAR T-cell solid tumor program
under its collaboration with ONO, the Company's expectations
regarding its receipt of future payments for milestones achieved
under its collaboration agreement with Janssen prior to the
termination of the agreement, the anticipated effects of the
Company’s workforce reduction and reprioritization of preclinical
and clinical development activities, including its projected cash
runway, and the timing of such events. These and any other
forward-looking statements in this release are based on
management's current expectations of future events and are subject
to a number of risks and uncertainties that could cause actual
results to differ materially and adversely from those set forth in
or implied by such forward-looking statements. These risks and
uncertainties include, but are not limited to, the risk that the
Company’s product candidates may not demonstrate the requisite
safety or efficacy to warrant further development or to achieve
regulatory approval, the risk that results observed in prior
studies of the Company’s product candidates, including preclinical
studies and clinical trials, will not be observed in ongoing or
future studies involving these product candidates, the risk of a
delay or difficulties in the manufacturing of the Company’s product
candidates or in the initiation and conduct of, or enrollment of
patients in, any clinical trials, the risk that the Company may
cease or delay preclinical or clinical development of any of its
product candidates for a variety of reasons (including requirements
that may be imposed by regulatory authorities on the initiation or
conduct of clinical trials, changes in the therapeutic, regulatory,
or competitive landscape for which the Company’s product candidates
are being developed, the amount and type of data to be generated or
otherwise to support regulatory approval, difficulties or delays in
patient enrollment and continuation in the Company’s ongoing and
planned clinical trials, difficulties in manufacturing or supplying
the Company’s product candidates for clinical testing, and any
adverse events or other negative results that may be observed
during preclinical or clinical development), the risk that results
observed in preclinical studies of its product candidates may not
be replicated in ongoing or future clinical trials, the risk that
its product candidates may not produce therapeutic benefits or may
cause other unanticipated adverse effects, the risk that the
Company may not comply with its obligations under and otherwise
maintain its collaboration agreement with ONO Pharmaceutical, Ltd.
or other parties with which the Company may enter into future
collaborations on the agreed upon terms, the risk that research
funding and milestone payments received by the Company under its
collaborations may be less than expected, and the risk that the
Company may incur operating expenses in amounts greater than
anticipated. For a discussion of other risks and uncertainties, and
other important factors, any of which could cause the Company’s
actual results to differ from those contained in the
forward-looking statements, see the risks and uncertainties
detailed in the Company’s periodic filings with the Securities and
Exchange Commission, including but not limited to the Company’s
most recently filed periodic report, and from time to time in the
Company’s press releases and other investor communications. Fate
Therapeutics is providing the information in this release as of
this date and does not undertake any obligation to update any
forward-looking statements contained in this release as a result of
new information, future events or otherwise.
Condensed Consolidated Statements of
Operations and Comprehensive Loss(in thousands,
except share and per share
data)(unaudited)
|
Three Months Ended |
|
March 31, |
|
2023 |
|
2022 |
|
|
|
Collaboration revenue |
$ |
58,980 |
|
|
$ |
18,414 |
|
Operating expenses: |
|
|
|
|
|
Research and development |
|
65,629 |
|
|
|
72,139 |
|
General and administrative |
|
21,943 |
|
|
|
20,742 |
|
Total
operating expenses |
|
87,572 |
|
|
|
92,881 |
|
Loss
from operations |
|
(28,592 |
) |
|
|
(74,467 |
) |
Other
income (expense): |
|
|
|
|
|
Interest income |
|
3,694 |
|
|
|
418 |
|
Change in fair value of stock price appreciation milestones |
|
1,718 |
|
|
|
8,359 |
|
Other Income |
|
4,299 |
|
|
|
— |
|
Total
other income (expense), net |
|
9,711 |
|
|
|
8,777 |
|
Net
loss |
$ |
(18,881 |
) |
|
$ |
(65,690 |
) |
Other
comprehensive income (loss): |
|
|
|
|
|
Unrealized gain on available-for-sale securities, net |
|
1,208 |
|
|
|
(2,088 |
) |
Comprehensive loss |
$ |
(17,673 |
) |
|
$ |
(67,778 |
) |
Net
loss per common share, basic and diluted |
$ |
(0.19 |
) |
|
$ |
(0.68 |
) |
Weighted–average common shares used to compute basic and diluted
net loss per share |
|
98,054,687 |
|
|
|
96,343,529 |
|
|
|
|
|
|
|
Condensed Consolidated Balance
Sheets(in
thousands)(unaudited)
|
March 31, |
|
December 31, |
|
2023 |
|
2022 |
|
|
|
|
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
42,020 |
|
|
$ |
61,333 |
|
Accounts receivable |
|
13,500 |
|
|
|
38,480 |
|
Short-term investments |
|
366,878 |
|
|
|
374,894 |
|
Prepaid expenses and other current assets |
|
15,490 |
|
|
|
27,367 |
|
Total current assets |
|
437,888 |
|
|
|
502,074 |
|
Long-term investments |
|
3,912 |
|
|
|
4,942 |
|
Operating lease right-of-use
asset |
|
64,682 |
|
|
|
66,069 |
|
Other long-term assets |
|
123,854 |
|
|
|
132,476 |
|
Total assets |
$ |
630,336 |
|
|
$ |
705,561 |
|
|
|
|
|
Liabilities and
stockholders’ equity |
|
|
|
Current liabilities: |
|
|
|
Accounts payable and accrued expenses |
$ |
41,368 |
|
|
$ |
62,197 |
|
Deferred revenue, current portion |
|
1,738 |
|
|
|
42,226 |
|
CIRM award liability, current portion |
|
— |
|
|
|
4,000 |
|
Operating lease liability, current portion |
|
5,545 |
|
|
|
5,628 |
|
Total current liabilities |
|
48,651 |
|
|
|
114,051 |
|
Operating lease liability, net
of current portion |
|
102,070 |
|
|
|
103,710 |
|
Stock price appreciation
milestones, net of current portion |
|
2,143 |
|
|
|
3,861 |
|
Stockholders’ equity |
|
477,472 |
|
|
|
483,939 |
|
Total liabilities and
stockholders’ equity |
$ |
630,336 |
|
|
$ |
705,561 |
|
|
|
|
|
|
|
|
|
Contact:Matthew GuidoStern Investor Relations,
Inc.212.362.1200matthew.guido@sternir.com
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