Frequency Therapeutics, Inc. (Nasdaq: FREQ), a regenerative
medicine company focused on developing therapeutics to activate a
person’s innate potential to restore function, today announced
business updates and financial results for the first quarter ended
March 31, 2023.
“We are pleased with the team’s progress in advancing our
program for remyelination in multiple sclerosis and we remain on
track to commence our clinical program in the first half of 2024.
We have now shown that Frequency’s novel compounds can drive
oligodendrocyte differentiation in evolutionarily distinct species,
furthering our ability to predict human doses, and have
independently conducted preclinical studies demonstrating
statistical improvements in MRI measurements of white matter
volume, an important clinical endpoint. Having outperformed prior
published approaches in head-to-head in vivo studies, we believe
our work can result in a best-in-class treatment to complement
existing disease modifying therapies and provide significant
benefit to patients,” said David L. Lucchino, Frequency’s chief
executive officer.
Lucchino continued: “We are highly encouraged by the level of
interest in our approach and the enthusiasm for a potential
remyelinating agent as well as the transformative impact it could
have on the current standard of care for this debilitating disease.
Our focus remains on advancing the MS program through clinical
studies and beyond, while working to maximize returns for our
shareholders.”
Recent Program and Business
Updates
The Company’s discovery efforts are focused on its program to
induce remyelination for individuals living with multiple sclerosis
(MS), an area where there currently are no restorative options for
patients. MS is characterized by demyelination, the stripping of
axons of the myelin sheaths that support neuronal signal conduction
and axonal survival. Frequency has identified a novel target
relevant for remyelination and has shown that modulation of this
target induced robust oligodendrocyte differentiation and
expression of myelin proteins in vitro, as well as multiple new
chemical entities (NCEs) that induce robust remyelination following
demyelination in an adult in vivo animal model.
These novel agents substantially outperform other clinically
studied remyelination agents, with a single oral dose yielding
significantly more remyelination than up to 10 doses of comparator
compounds. The Company believes there is a well-defined clinical
path for the program, with functional outcomes such as visual
acuity, and objective biomarkers such as visual evoked potential
(VEP) and magnetic resonance imaging (MRI), for studying the
performance of remyelination therapies in MS patients.
As the Company advances the program through toxicology studies,
it has shown:
- Its NCEs drive oligodendrocyte differentiation in
evolutionarily distinct species including mice, rats, and pigs,
improving the ability to predict human doses.
- Statistical improvements in MRI measurements of white matter
volume, a potentially important clinical endpoint, in independently
conducted preclinical studies.
- Substantial remyelination occurs in both white matter, which
underlies sensory and motor function, and gray matter, which
mediates cognition. Cognitive deficits are commonly observed early
in disease progression and gray matter remyelination could drive
significant patient benefit.
Following its recent restructuring, the Company has funding into
2025, which will allow it to complete an initial clinical study for
its remyelination in MS program. In February, the Company announced
that it would be exploring strategic options and evaluating all
opportunities that can create value for shareholders.
First Quarter 2023 Financial
Results
Cash Position: As of March 31, 2023, Frequency had cash,
cash equivalents and marketable securities of $66.7 million
(excluding restricted cash), or $55.0 million net of debt. In
April, the Company prepaid all outstanding loans, eliminating its
debt burden.
Frequency believes that the restructuring activities will
generate sufficient cost savings to extend its runway into 2025 and
enable it to complete a first clinical trial of its MS Program.
Research and Development Expenses: Research and
development expenses were $11.4 million for the three months ended
March 31, 2023, as compared to $13.8 million for the comparable
period of 2022. Excluding stock-based compensation expense of $0.8
million, research and development expenses for the three months
ended March 31, 2023 were $10.6 million.
General and Administrative Expenses: General and
administrative expenses were $9.2 million for the three months
ended March 31, 2023, as compared to $9.5 million for the
comparable period of 2022. Excluding stock-based compensation
expense of $2.6 million, general and administrative expenses for
the three months ended March 31, 2023 were $6.6 million.
Net Loss: Net loss was $19.5 million for the three months
ended March 31, 2023, as compared to $23.4 million for the
comparable period of 2022.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. All statements contained in this press release that do not
relate to matters of historical fact should be considered
forward-looking statements, including without limitation statements
regarding the treatment potential and timing of the Company‘s
remyelination program in MS (MS Program), including the timing of
clinical development, the existence of a well-defined clinical path
for the MS Program, potential application of the regenerative
medicine platform to other diseases, the ability of our
regenerative medicine platform to provide patient benefit, and the
sufficiency of the Company’s capital resources, including having
sufficient resources to complete a first clinical trial in its MS
Program.
These forward-looking statements are based on management’s
current expectations. These statements are neither promises nor
guarantees, but involve known and unknown risks, uncertainties and
other important factors that may cause actual results, performance
or achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements, including, but not limited to, the
following: the impact of COVID-19 on the Company’s planned clinical
trials, research and development and manufacturing activities, the
Company’s business and financial markets; the Company has incurred
and will continue to incur significant losses and is not and may
never be profitable; the Company’s need for additional funding to
complete development and commercialization of any product
candidate; the unproven approach of the PCA platform and the
inability to identify additional potential product candidates; the
lengthy, expensive and uncertain process of clinical drug
development and regulatory approval; the Company’s limited
experience successfully obtaining marketing approval for and
commercializing product candidates; the results of pre-clinical
studies not being indicative of the results from clinical trials;
adverse events or undesirable side effects; disruptions at the FDA
and other regulatory agencies; failure to identify additional
product candidates; new or changed legislation; costly and damaging
litigation, including related to product liability or intellectual
property or brought by stockholders; misconduct by employees or
independent contractors; reliance on third parties, including to
conduct clinical trials and manufacture product candidates;
compliance with changing laws and regulations, including healthcare
and environmental, health, data privacy and safety laws and
regulations; failure to obtain, maintain and enforce protection of
patents and other intellectual property rights covering product
candidates; security breaches or failure to protect private
personal information; attracting and retaining key personnel; and
the Company’s ability to manage growth.
These and other important factors discussed under the caption
“Risk factors” in the Company’s Form 10-K filed with the Securities
and Exchange Commission (SEC) on March 10, 2023, and its other
reports filed with the SEC could cause actual results to differ
materially from those indicated by the forward-looking statements
made in this press release. Any such forward-looking statements
represent management’s estimates as of the date of this press
release. While the Company may elect to update such forward-looking
statements at some point in the future, it disclaims any obligation
to do so, even if subsequent events cause its views to change.
These forward-looking statements should not be relied upon as
representing the Company’s views as of any date subsequent to the
date of this press release.
About Frequency Therapeutics
Headquartered in Lexington, Mass., Frequency Therapeutics is
pioneering a new category in regenerative medicine that aims to
restore human function by developing therapeutics that activate a
person’s innate regenerative potential within the body through the
activation of progenitor cells. The Company’s lead preclinical
program is designed to activate oligodendrocyte precursor cells
with the goal of driving remyelination and potential functional
recovery for individuals living with multiple sclerosis. For more
information, visit www.frequencytx.com and follow Frequency on
Twitter @Frequencytx.
Frequency Therapeutics,
Inc.
Consolidated Statements of
Operations
(in thousands, except share
and per share amounts)
Three Months Ended March
31,
2023
2022
Operating expenses:
Research and development
11,355
13,781
General and administrative
9,156
9,477
Total operating expenses
20,511
23,258
Loss from operations
(20,511
)
(23,258
)
Interest income
523
95
Interest expense
(284
)
(178
)
Other income (expense), net
753
(33
)
Loss before income taxes
(19,519
)
(23,374
)
Income tax provision
(24
)
(12
)
Net loss
$
(19,543
)
$
(23,386
)
Net loss per share attributable to common
stockholders-basic and diluted
$
(0.55
)
$
(0.67
)
Weighted-average shares of common stock
outstanding-basic and diluted
35,324,053
34,810,676
Frequency Therapeutics,
Inc.
Consolidated Balance Sheet
Data
(in thousands)
March 31, 2023
December 31, 2022
Cash, cash equivalents and marketable
securities
66,650
83,097
Working capital
47,256
66,467
Total assets
101,501
121,238
Total liabilities
48,252
52,043
Accumulated deficit
(281,208
)
(261,665
)
Total stockholders' equity
53,249
69,195
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Investor and Media Contact: Frequency Therapeutics Email:
investors@frequencytx.com
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