Finch Therapeutics Provides Corporate Updates and Reports Third Quarter 2022 Financial Results
November 10 2022 - 7:00AM
Finch Therapeutics Group, Inc. (“Finch” or “Finch Therapeutics”)
(Nasdaq: FNCH), a clinical-stage microbiome therapeutics company
leveraging its Human-First Discovery® platform to develop a novel
class of orally administered biological drugs, today provided
corporate updates and reported financial results for the third
quarter ended September 30, 2022.
“We are pleased with the tremendous progress our team has made
recently to advance the development of our lead program, with
patient dosing now underway in our PRISM4 Phase 3 trial of CP101, a
product candidate that we believe holds the potential to fulfill
the need for a convenient, one-time oral therapy to prevent
recurrent C. difficile infection,” said Mark Smith, PhD, Chief
Executive Officer of Finch Therapeutics. “In an effort to
accelerate our timeline to topline PRISM4 data and conserve
capital, we are evaluating possible modifications to PRISM4 for
future discussion with FDA, such as a reduction in the size of the
randomized portion of the trial, an approach that may be informed
in part by regulatory insights from the recent FDA advisory
committee meeting for an enema-based microbiome product candidate.
We look forward to providing additional updates as we continue to
advance this important program.”
Recent Program Highlights
- Proceeded with Patient Dosing in PRISM4 Recurrent CDI
Trial, with Topline PRISM4 Data Anticipated in H1 2024: In
October 2022, Finch announced that it had proceeded with patient
dosing in PRISM4, a Phase 3 trial of CP101 for the prevention of
recurrent C. difficile infection (CDI). The PRISM4 trial has two
parts: a randomized, double-blind, placebo-controlled portion and
an open-label portion for eligible participants who experience a
recurrence during the randomized portion of PRISM4. Topline data
from the randomized portion of PRISM4 is anticipated in the first
half of 2024. To expand the safety database for CP101 in support of
a potential Biologics License Application (BLA), Finch plans to
allow direct entry into the open-label portion of PRISM4 following
the completion of enrollment in the randomized portion of
PRISM4.
- Presented CP101 PRISM-EXT Biomarker Data at ACG
2022: In October 2022, Finch announced the presentation of
biomarker data from the PRISM-EXT open-label trial of CP101 in
recurrent CDI at the American College of Gastroenterology (ACG)
2022 Annual Scientific Meeting. Following open-label administration
of CP101 after standard-of-care (SOC) CDI antibiotics, there was a
significant increase in microbiome diversity from baseline through
week 8 and week 24 in PRISM-EXT participants. Higher engraftment of
CP101-associated taxa and improvement in diversity were both
associated with prevention of CDI recurrence through week 8 in
PRISM-EXT participants. As previously reported, 80.3% and 78.8% of
participants who received CP101 following SOC antibiotics in
PRISM-EXT were without CDI recurrence through week 8 and week 24,
respectively (n=132).
- Conducted Strategic Portfolio Review:
Following a recent strategic review of its portfolio, which
includes wholly-owned microbiome product candidates for recurrent
CDI, inflammatory bowel disease (IBD) and autism spectrum disorder
(ASD), Finch is prioritizing the development of CP101 in recurrent
CDI and exploring opportunities to potentially advance the
development of its pre-clinical candidates for IBD through
strategic partnerships. In connection with the strategic review,
Finch has suspended efforts to initiate a Phase 1 trial of FIN-211
in ASD while the Company explores opportunities to leverage
clinical data generated by ongoing third-party studies to inform
its autism program strategy going forward, as previously
announced.
Recent Corporate Highlights
- Appointed Howard Franklin, MD, MBA, as Chief Medical
Officer: Dr. Franklin, a general surgeon and
biopharmaceutical executive with more than 20 years of experience
spanning clinical practice, clinical development, medical affairs,
regulatory strategy, and product commercialization, previously
served as Interim Chief Medical Officer for Finch. Prior to Finch,
Dr. Franklin served as Chief Medical Officer at Salix
Pharmaceuticals, where he provided leadership and expertise to
program teams focused on the development of GI therapeutics. Prior
to Salix, he held leadership roles within early-stage biotechnology
companies as well as large pharmaceutical companies, including Icon
Bioscience, Oceana Therapeutics, The Medicines Company, and Esprit
Pharma.
Third Quarter 2022 Financial Results
- Finch reported a net loss of $40.4 million for the third
quarter of 2022, compared to a net loss of $10.0 million for the
same period in 2021. The net loss was driven by a charge of $18.1
million for the full impairment of the Company’s goodwill during
the current quarter. Additionally, there was a decrease in revenue
of $11.2 million due to changes under Finch’s collaboration
agreement with Takeda, including Takeda’s election in August 2022
to terminate the agreement. Finch also reported an increase in
restructuring expenses of $1.3 million quarter-over-quarter.
- Research and development (R&D) expenses were $11.9 million
for the third quarter of 2022, compared to $15.5 million for the
same period in 2021. The decrease in R&D expense was driven by
a decrease in expenses related to the CP101 program, primarily due
to a decrease in external clinical research organization costs, in
addition to a decrease in IBD program expenses due to Takeda’s
election in August 2022 to terminate its collaboration agreement
with Finch. Additionally, there was a decrease in expenses
associated with both the hepatitis B (HBV) and ASD programs, due to
the Company's decision to suspend its HBV program, announced on
March 31, 2022, and its subsequent decision, announced on September
1, 2022, to suspend its Phase 1 clinical trial in ASD.
- General and administrative (G&A) expenses were $9.6 million
for the third quarter of 2022, compared to $5.7 million for the
same period in 2021. The increase in G&A expense was primarily
due to an increase in professional fees, in addition to an increase
in facility-related costs and stock-based compensation expense.
This increase was partially offset by a decrease in
employee-related expenses due to reduced headcount.
- Finch’s cash and cash equivalents as of September 30, 2022 were
$85.3 million, compared to $133.5 million as of December 31, 2021.
Finch believes its cash and cash equivalents on hand as of
September 30, 2022, together with anticipated cash inflows from
executed subleases for one of the Company’s office and lab
facilities, will fund its operations into Q2 2024.
About the PRISM4 Phase 3 Trial
PRISM4 is a randomized, double-blind, placebo-controlled,
multi-center Phase 3 trial evaluating the efficacy and safety of a
one-time oral administration of CP101 for the prevention of
recurrent C. difficile infection (CDI). After completing
standard-of-care CDI antibiotics for their most recent CDI
recurrence, eligible participants will be randomized in a 2:1 ratio
to receive either CP101 or placebo. Participants will be evaluated
for CDI recurrence and safety through week 8, the primary endpoint,
as well as through week 24. Participants who qualify may enroll in
the optional open label arm and receive CP101 if they experience a
CDI recurrence through week 8 of the trial. To learn more about the
trial, visit clinicaltrials.gov (Identifier: NCT05153499) or the
study website at https://prism4trial.com/.
About Finch Therapeutics
Finch Therapeutics is a clinical-stage microbiome therapeutics
company leveraging its Human-First Discovery® platform to develop a
novel class of orally administered biological drugs. Finch’s lead
candidate, CP101, is in late-stage clinical development for the
prevention of recurrent C. difficile infection and has received
Breakthrough Therapy and Fast Track designations from the U.S. Food
and Drug Administration. Finch is exploring strategic options to
potentially advance the development of its pre-clinical candidates
FIN-524 for ulcerative colitis and FIN-525 for Crohn's disease and
its pre-clinical program in autism spectrum disorder. Finch
routinely posts information that may be important to its investors
on its website at www.finchtherapeutics.com. Finch encourages
investors to consult the “Investors & News” section of its
website regularly.
Human-First Discovery® is a registered trademark of Finch
Therapeutics Group, Inc.
Forward-Looking Statements
This press release includes “forward-looking statements.” Words
such as “will,” "anticipates," "believes," "expects," "intends,"
“plans,” “potential,” "projects,” “would” and "future" or similar
expressions are intended to identify forward-looking statements.
These forward-looking statements include, but are not limited to,
statements regarding: the therapeutic potential of Finch’s product
candidates, including the potential of CP101 to fulfill the need
for a convenient, one-time oral therapy for the prevention of
recurrent CDI; possible modifications to PRISM4 and Finch’s ability
to leverage regulatory insights from a recent FDA advisory
committee meeting; Finch’s ability to accelerate its timeline to
topline PRISM4 data and conserve capital; the anticipated timing
for topline data from PRISM4; Finch’s plans to allow direct entry
in the open-label portion of PRISM4 to expand the safety database
for CP101; potential strategic partnerships to advance Finch’s
product candidates; opportunities to leverage clinical data
generated by third-party studies to inform Finch’s ASD program
strategy; Finch’s cash runway; and Finch’s ability to develop a
novel class of orally administered biological drugs. Because such
statements are subject to risks and uncertainties, actual results
may differ materially from those expressed or implied by such
forward-looking statements. These risks and uncertainties include,
among others, those related to: Finch’s limited operating history
and historical losses; Finch’s ability to raise additional funding
to complete the development and any commercialization of its
product candidates; Finch’s dependence on the success of its lead
product candidate, CP101; the possibility that Finch may be delayed
in initiating, enrolling or completing any clinical trials,
including PRISM4; results of clinical trials may not be indicative
of final or future results from later stage or larger clinical
trials (or in broader patient populations once the product is
approved for use by regulatory agencies) or may not be favorable or
may not support further development; Finch’s product candidates may
not generate the benefits to patients that are anticipated; results
of clinical trials may not be sufficient to satisfy regulatory
authorities to approve Finch’s product candidates in their targeted
or other indications (or such authorities may request additional
trials or additional information); Finch’s ability to comply with
regulatory requirements; ongoing regulatory obligations and
continued regulatory review may result in significant additional
expense to Finch and Finch could be subject to penalties for
failure to comply; competition from third parties that are
developing products for similar uses; Finch’s ability to maintain
patent and other intellectual property protection and the
possibility that Finch’s intellectual property rights may be
infringed, invalid or unenforceable or will be threatened by third
parties; Finch’s ability to qualify and scale its manufacturing
capabilities; Finch’s lack of experience in selling, marketing and
distributing its product candidates; Finch’s dependence on third
parties in connection with manufacturing, clinical trials and
preclinical studies; and risks relating to the impact and duration
of the COVID-19 pandemic on Finch’s business. These and other risks
are described more fully in Finch’s filings with the Securities and
Exchange Commission (“SEC”), including the section titled “Risk
Factors” in Finch’s Annual Report on Form 10-K for the year ended
December 31, 2021 filed with the SEC on March 31, 2022, as
supplemented by Finch’s Quarterly Reports on Form 10-Q filed with
the SEC on May 16, 2022 and August 11, 2022, as well as discussions
of potential risks, uncertainties, and other important factors in
Finch’s other filings with the SEC. All forward-looking statements
contained in this press release speak only as of the date on which
they were made. Except to the extent required by law, Finch
undertakes no obligation to update such statements to reflect
events that occur or circumstances that exist after the date on
which they were made.
Investor Contact: Stephen Jasper Gilmartin
Group (858) 525-2047 stephen@gilmartinir.com
Media Contact: Jenna Urban Berry & Company
Public Relations (212) 253-8881 jurban@berrypr.com
Finch Therapeutics Group,
Inc.Condensed Consolidated Statements of
Operations (Unaudited)(in thousands, except share
and per share data)
|
|
FOR THE THREE MONTHSENDED SEPTEMBER 30, |
|
|
FOR THE NINE MONTHSENDED SEPTEMBER 30, |
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
Collaboration revenue |
|
$ |
138 |
|
|
$ |
11,343 |
|
|
$ |
853 |
|
|
$ |
17,726 |
|
Total revenue |
|
|
138 |
|
|
|
11,343 |
|
|
|
853 |
|
|
|
17,726 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Research
and development |
|
|
11,859 |
|
|
|
15,537 |
|
|
|
41,312 |
|
|
|
42,476 |
|
General
and administrative |
|
|
9,584 |
|
|
|
5,739 |
|
|
|
27,152 |
|
|
|
16,173 |
|
Impairment of goodwill |
|
|
18,057 |
|
|
|
— |
|
|
|
18,057 |
|
|
|
— |
|
Restructuring expense |
|
|
1,270 |
|
|
|
— |
|
|
|
2,173 |
|
|
|
— |
|
Total operating expenses |
|
|
40,770 |
|
|
|
21,276 |
|
|
|
88,694 |
|
|
|
58,649 |
|
Loss
from operations |
|
|
(40,632 |
) |
|
|
(9,933 |
) |
|
|
(87,841 |
) |
|
|
(40,923 |
) |
Other
income (expense) |
|
|
261 |
|
|
|
(22 |
) |
|
|
203 |
|
|
|
1,818 |
|
Net loss |
|
$ |
(40,371 |
) |
|
$ |
(9,955 |
) |
|
$ |
(87,638 |
) |
|
$ |
(39,105 |
) |
Net loss
per share attributable to common stockholders—basic and
diluted |
|
$ |
(0.85 |
) |
|
$ |
(0.21 |
) |
|
$ |
(1.84 |
) |
|
$ |
(1.07 |
) |
Weighted-average common stock outstanding—basic and diluted |
|
|
47,728,130 |
|
|
|
47,445,195 |
|
|
|
47,611,872 |
|
|
|
36,408,506 |
|
Finch Therapeutics Group,
Inc.Condensed Consolidated Balance Sheet Data
(Unaudited)(in thousands)
|
|
SEPTEMBER 30,2022 |
|
|
DECEMBER 31,2021 |
|
Assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
85,292 |
|
|
$ |
133,481 |
|
Other assets |
|
|
102,676 |
|
|
|
91,888 |
|
Total assets |
|
$ |
187,968 |
|
|
$ |
225,369 |
|
Liabilities, redeemable convertible preferred stock and
stockholders' equity |
|
|
|
|
|
|
Liabilities |
|
|
67,102 |
|
|
|
23,145 |
|
Stockholders' equity |
|
|
120,866 |
|
|
|
202,224 |
|
Total liabilities and stockholders' equity |
|
$ |
187,968 |
|
|
$ |
225,369 |
|
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