Company Secures up to $150 Million in
Non-Dilutive Funding from Oxford Finance LLC; Expected Cash Runway
Through 2025 to Support Continued Development and Potential
Commercial Launches of VS-6766 and Defactinib
Enrollment Complete in Selection Phase (Part A)
of RAMP 201 Evaluating VS-6766 +/- Defactinib for the Treatment of
Low-Grade Serous Ovarian Cancer; Expect to Report Results from Part
A in 2Q 2022
Enrollment Complete in Selection Phase (Part A)
of RAMP 202 Evaluating VS-6766 +/- Defactinib for the Treatment of
KRAS G12V Mutant Non-Small Cell Lung Cancer; Expect to Report
Results from Part A in 2H 2022
Clinical Collaborations and
Investigator-Sponsored Trial Programs Ongoing in Additional Areas
of High Unmet Need
Verastem Oncology (Nasdaq: VSTM), a biopharmaceutical company
committed to advancing new medicines for patients with cancer,
today reported financial results for the three months and full year
ended December 31, 2021, and highlighted recent progress.
“We anticipate a catalyst-driven year and are well-positioned to
maximize the potential of VS-6766 as a backbone therapy across RAS
pathway-driven solid tumors in order to bring new solutions to
patients in areas of high unmet need. Our recent debt facility adds
flexibility to our financial strength and is expected to support
the continued development and potential commercial launches of
VS-6766 and defactinib, including building on our breakthrough
therapy designation in low-grade serous ovarian cancer,” said Brian
Stuglik, Chief Executive Officer of Verastem Oncology. “We plan to
report results from the selection phase of RAMP 201, our lead
program in patients with low-grade serous ovarian cancer,
regardless of KRAS status, during the second quarter. And, as part
of our non-small cell lung cancer program, we are targeting KRAS
mutant patient subpopulations across four clinical trials and we
are anticipating initial readouts from three NSCLC studies,
including RAMP 202 with defactinib, the investigator-sponsored
study with everolimus, and RAMP 203 with LUMAKRASTM (sotorasib)
this year.”
Fourth Quarter 2021 and Recent Highlights
Verastem’s lead drug candidate VS-6766 is a RAF/MEK clamp that
induces inactive complexes of MEK with ARAF, BRAF and CRAF,
potentially creating a more complete and durable anti-tumor
response through maximal RAS pathway inhibition.
Low Grade Serous Ovarian Cancer (LGSOC)
- Planned enrollment is complete in the selection phase (Part A;
n=64) of the registration-directed Phase 2 RAMP 201 study
investigating VS-6766 alone or in combination with defactinib for
the treatment of recurrent LGSOC. Verastem remains on track to
report topline results from Part A during the second quarter of
2022, following discussions with regulatory authorities.
- Enrollment has commenced in the expansion phase (Part B) of
RAMP 201, with both treatment arms (VS-6766 alone and in
combination with defactinib) currently advancing in all patients.
Verastem expects to complete enrollment in Part B during the second
half of 2022.
KRAS Mutant Non-Small Cell Lung Cancer (NSCLC)
- Planned enrollment is now complete in the selection phase (Part
A; n=32) of the registration-directed RAMP 202 study investigating
VS-6766 alone and in combination with defactinib in patients with
KRAS G12V mutant NSCLC. The Company expects to report topline
results from Part A and initiate Part B during the second half of
2022, following discussions with regulatory authorities.
- Based on preclinical rationale, Verastem has added BRAF mutant
cohorts to the RAMP 202 study in order to efficiently evaluate
VS-6766 with defactinib in BRAF-mutant NSCLC. In Part A of the
study, the Company expects to enroll two cohorts comprised of 15
patients each to evaluate the combination in patients with V600E or
non-V600E BRAF mutations, respectively. These cohorts are open and
enrolling.
- The Company entered into two clinical agreements to study
VS-6766 in combination with KRAS G12C inhibitors in patients with
KRAS G12C-mutant NSCLC, including patients who have progressed on a
KRAS G12C inhibitor. Initial results from the ongoing Phase 1/2
RAMP 203 study evaluating VS-6766 in combination with Amgen’s
LUMAKRASTM (sotorasib) are expected to be reported during the
second half of 2022. Initiation of the Phase 1/2 RAMP 204 study
evaluating VS-6766 in combination with Mirati’s adagrasib is
expected during the second quarter of 2022.
Corporate Updates
- Secured debt facility with Oxford Finance LLC for up to $150
Million. Under the terms of the credit facility with Oxford Finance
LLC, Verastem drew an initial $25 million term loan at closing. The
Company has the ability to access up to an additional $125 million
in a series of tranches, $75 million of which are based on certain
pre-determined milestones and $50 million at the lender’s
discretion.
- With the credit facility and expected milestones related to the
sale of COPIKTRA® (duvelisb) to Secura Bio Inc. (Secura) in 2020,
the Company expects to have a cash runway through 2025 to support
the continued development and potential commercial launches of
VS-6766 and defactinib.
- In the first quarter of 2022, Secura Bio Inc.’s (Secura)
sublicensee, CSPC Pharmaceutical Group Limited, obtained drug
registration approval for duvelisib granted by the National Medical
Products Administration of the People’s Republic of China for the
treatment of adult patients with relapsed or refractory follicular
lymphoma after at least two prior systematic therapies. This
entitles Verastem to a $2.5 million milestone payment from Secura,
pursuant to the sale of COPIKTRA® (duvelisb) to Secura in
2020.
- Appointed Michelle Robertson to join the Verastem Board of
Directors. Ms. Robertson is the Chief Financial Officer at Editas
Medicine and brings more than 25 years of finance and commercial
operations leadership to the Board. Timothy Barberich will be
retiring from the Board as of March 31, 2022. Verastem appreciates
his significant contributions since his appointment in March,
2014.
- Appointed Channing Der, PhD, Sarah Graham Kenan Distinguished
Professor at the University of North Carolina at Chapel Hill to the
Company’s Scientific Advisory Board.
Fourth Quarter 2021 Financial Results
Total revenue for the three months ending December 31, 2021
(2021 Quarter) was $0.5 million, compared to $0.5 million for the
three months ended December 31, 2020 (2020 Quarter).
Total research and development (R&D) and selling, general
and administrative (SG&A) expenses for the 2021 Quarter were
$17.1 million, compared to $17.3 million for the 2020 Quarter.
R&D expenses for the 2021 Quarter were $11.4 million,
compared to $10.2 million for the 2020 Quarter. The increase of
$1.2 million, or 11.8%, primarily resulted from increase in
contract research organization costs and investigator fees.
SG&A expenses for the 2021 Quarter were $5.7 million,
compared to $7.1 million for the 2020 Quarter. The decrease of $1.4
million, or 19.7%, primarily resulted from lower employee related
expenses and consulting and professional fees.
Net loss for the 2021 Quarter was $16.5 million, or $0.09 per
share (basic and diluted), compared to net loss of $19.9 million,
or $0.12 per share (basic and diluted), for the 2020 Quarter.
For the 2021 Quarter, non-GAAP adjusted net loss was $14.9
million, or $0.08 per share (diluted), compared to non-GAAP
adjusted net loss of $14.8 million, or $0.09 per share (diluted),
for the 2020 Quarter. Please refer to the GAAP to Non-GAAP
Reconciliation attached to this press release.
Full-Year 2021 Financial Results
Verastem Oncology ended the fourth quarter of 2021 with cash,
cash equivalents and investments of $100.3 million. On a pro forma
basis, inclusive of the funding received from the $25 million
drawdown of new debt facility, cash, cash equivalents and
investments were $125.3 million as of December 31, 2021.
Total revenue for the year ended December 31, 2021 (2021 Period)
was $2.1 million, compared to $88.5 million for the year ended
December 31, 2020 (2020 Period). Revenue for the 2021 Period was
comprised of (i) $1.4 million of revenue recognized for milestones
and royalties as part of the sale of COPIKTRA to Secura Bio, Inc.
(Secura), and (ii) $0.6 million of transition services revenue for
certain support functions provided to Secura pursuant to the Secura
transition services agreement which was entered into in connection
with the sale of COPIKTRA to Secura. Revenue for the 2020 Period
revenue was comprised of (i) $70.0 million recognized for the
upfront payment made as part of the sale of COPIKTRA to Secura,
(ii) $15.2 million of net product revenue, (iii) $2.9 million of
license and collaboration revenue, and (iv) $0.4 million of
transition services revenue for certain support functions provided
to Secura.
Total R&D and SG&A expenses for the 2021 Period were
$63.5 million, compared to $104.1 million for the 2020 Period.
R&D expense for the 2021 Period was $39.3 million, compared
to $41.4 million for the 2020 Period. The decrease of $2.1 million,
or 5.1%, was primarily related to the upfront non-refundable
payment of $3.0 million to Chugai Pharmaceutical Co., Ltd for the
VS-6766 license in the 2020 Period, and a decrease in other
operating costs. This decrease was partially offset by an increase
in investigator fees and an increase in personnel related
costs.
SG&A expense for the 2021 Period was $24.1 million, compared
to $62.8 million for the 2020 Period. The decrease of $38.7
million, or 61.6%, was primarily resulted from the Company’s shift
in strategic direction and the sale of COPIKTRA to Secura, which
led to lower employee-related expenses and consulting and
professional fees.
Net loss for the 2021 Period was $71.2 million, or $0.41 per
share (basic and diluted), compared to $67.7 million, or $0.44 per
share (basic and diluted), for the 2020 Period.
For the 2021 Period, non-GAAP adjusted net loss was $54.1
million, or $0.31 per share (diluted), compared to non-GAAP
adjusted net loss of $37.8 million, or $0.25 per share (diluted),
for the 2020 Period. Please refer to the GAAP to Non-GAAP
Reconciliation attached to this press release.
Use of Non-GAAP Financial Measures
To supplement Verastem Oncology’s condensed consolidated
financial statements, which are prepared and presented in
accordance with generally accepted accounting principles in the
United States (GAAP), the Company uses the following non-GAAP
financial measures in this press release: non-GAAP adjusted net
(loss) income and non-GAAP net (loss) income per share. These
non-GAAP financial measures exclude certain amounts or expenses
from the corresponding financial measures determined in accordance
with GAAP. Management believes this non-GAAP information is useful
for investors, taken in conjunction with the Company’s GAAP
financial statements, because it provides greater transparency and
period-over-period comparability with respect to the Company’s
operating performance and can enhance investors’ ability to
identify operating trends in the Company’s business. Management
uses these measures, among other factors, to assess and analyze
operational results and trends and to make financial and
operational decisions. Non-GAAP information is not prepared under a
comprehensive set of accounting rules and should only be used to
supplement an understanding of the Company’s operating results as
reported under GAAP, not in isolation or as a substitute for, or
superior to, financial information prepared and presented in
accordance with GAAP. In addition, these non-GAAP financial
measures are unlikely to be comparable with non-GAAP information
provided by other companies. The determination of the amounts that
are excluded from non-GAAP financial measures is a matter of
management judgment and depends upon, among other factors, the
nature of the underlying expense or income amounts. Reconciliations
between these non-GAAP financial measures and the most comparable
GAAP financial measures for the three months and year ended
December 31, 2021 and 2020 are included in the tables accompanying
this press release after the unaudited condensed consolidated
financial statements.
About VS-6766
VS-6766 (formerly known as CH5126766 and RO5126766) is a RAF/MEK
clamp that induces inactive complexes of MEK with ARAF, BRAF and
CRAF potentially creating a more complete and durable anti-tumor
response through maximal RAS pathway inhibition. VS-6766 is
currently in late-stage development.
In contrast to other MEK inhibitors, VS-6766 blocks both MEK
kinase activity and the ability of RAF to phosphorylate MEK. This
unique mechanism allows VS-6766 to block MEK signaling without the
compensatory activation of MEK that appears to limit the efficacy
of other inhibitors. The U.S. Food and Drug Administration granted
Breakthrough Therapy designation for the combination of Verastem
Oncology’s investigational RAF/MEK inhibitor VS-6766, with
defactinib, its FAK inhibitor, for the treatment of all patients
with recurrent low-grade serous ovarian cancer (LGSOC) regardless
of KRAS status after one or more prior lines of therapy, including
platinum-based chemotherapy.1
Verastem Oncology is conducting Phase 2 registration-directed
trials of VS-6766 alone and with defactinib in patients with
recurrent LGSOC and in patients with recurrent KRAS G12V-mutant
NSCLC as part of its RAMP (Raf And Mek Program) clinical trials,
RAMP 201 and RAMP 202, respectively. Verastem Oncology has also
established clinical collaborations with Amgen and Mirati to
evaluate LUMAKRAS™ (sotorasib) and adagrasib in combination with
VS-6766 in KRAS G12C-mutant NSCLC as part of the RAMP 203 and RAMP
204 trials, respectively.
About Verastem Oncology
Verastem Oncology (Nasdaq: VSTM) is a development-stage
biopharmaceutical company committed to the development and
commercialization of new medicines to improve the lives of patients
diagnosed with cancer. Our pipeline is focused on novel small
molecule drugs that inhibit critical signaling pathways in cancer
that promote cancer cell survival and tumor growth, including
RAF/MEK inhibition and focal adhesion kinase (FAK) inhibition. For
more information, please visit www.verastem.com.
Forward-Looking Statements Notice
This press release includes forward-looking statements about
Verastem Oncology’s strategy, future plans and prospects, including
statements related to the potential clinical value of various of
its clinical trials, the timing of commencing and completing
trials, including topline data reports, and potential for
additional development programs involving Verastem Oncology’s lead
compound. The words "anticipate," "believe," "estimate," "expect,"
"intend," "may," "plan," "predict," "project," "target,"
"potential," "will," "would," "could," "should," "continue," “can,”
“promising” and similar expressions are intended to identify
forward-looking statements, although not all forward-looking
statements contain these identifying words. Each forward-looking
statement is subject to risks and uncertainties that could cause
actual results to differ materially from those expressed or implied
in such statement.
Applicable risks and uncertainties include the risks and
uncertainties, among other things, regarding: the success in the
development and potential commercialization of our product
candidates, including VS-6766 in combination with other compounds,
including defactinib, LUMAKRASTM and others; the occurrence of
adverse safety events and/or unexpected concerns that may arise
from additional data or analysis or result in unmanageable safety
profiles as compared to their levels of efficacy; our ability to
obtain, maintain and enforce patent and other intellectual property
protection for our product candidates; the scope, timing, and
outcome of any legal proceedings; decisions by regulatory
authorities regarding labeling and other matters that could affect
the availability or commercial potential of our product candidates;
whether preclinical testing of our product candidates and
preliminary or interim data from clinical trials will be predictive
of the results or success of ongoing or later clinical trials; that
the timing, scope and rate of reimbursement for our product
candidates is uncertain; that third-party payors (including
government agencies) may not reimburse; that there may be
competitive developments affecting our product candidates; that
data may not be available when expected; that enrollment of
clinical trials may take longer than expected; that our product
candidates will experience manufacturing or supply interruptions or
failures; that we will be unable to successfully initiate or
complete the clinical development and eventual commercialization of
our product candidates; that the development and commercialization
of our product candidates will take longer or cost more than
planned; that we or Chugai Pharmaceutical Co., Ltd. will fail to
fully perform under the VS-6766 license agreement; that we or our
other collaboration partners may fail to perform under our
collaboration agreements; that we may not have sufficient cash to
fund our contemplated operations; that we may be unable to obtain
adequate financing in the future through product licensing,
co-promotional arrangements, public or private equity, debt
financing or otherwise; that we will be unable to execute on our
partnering strategies for VS-6766 in combination with other
compounds; that we will not pursue or submit regulatory filings for
our product candidates; and that our product candidates will not
receive regulatory approval, become commercially successful
products, or result in new treatment options being offered to
patients.
Other risks and uncertainties include those identified under the
heading “Risk Factors” in the Company’s Annual Report on Form 10-K
for the year ended December 31, 2021 as filed with the Securities
and Exchange Commission (SEC) on March 28, 2022 and in any
subsequent filings with the SEC. The forward-looking statements
contained in this press release reflect Verastem Oncology’s views
as of the date hereof, and the Company does not assume and
specifically disclaims any obligation to update any forward-looking
statements whether as a result of new information, future events or
otherwise, except as required by law.
References
1 Verastem Oncology Press Release. Verastem Oncology Receives
Breakthrough Therapy Designation for VS-6766 with Defactinib in
Recurrent Low-Grade Serous Ovarian Cancer. May 24, 2021. Available
at:
https://investor.verastem.com/news-releases/news-release-details/verastem-oncology-receives-breakthrough-therapy-designation-vs.
Accessed March 2022.
Verastem Oncology
Condensed Consolidated Balance
Sheets
(in thousands)
(unaudited)
December 31,
December 31,
2021
2020
Cash, cash equivalents, &
investments
$
100,256
$
147,221
Accounts receivable, net
516
239
Prepaid expenses and other current
assets
4,968
3,473
Property and equipment, net
210
416
Right-of-use asset, net
2,302
2,726
Restricted cash and other assets
410
274
Total assets
$
108,662
$
154,349
Current Liabilities
$
18,590
$
17,093
Convertible senior notes
249
19,051
Lease Liability, long-term
2,264
2,931
Stockholders’ equity
87,559
115,274
Total liabilities and stockholders’
equity
$
108,662
$
154,349
Verastem Oncology
Condensed Consolidated
Statements of Operations
(in thousands, except per share
amounts)
(unaudited)
Three months ended December
31,
Year ended December
31,
2021
2020
2021
2020
Revenue:
Product revenue, net
$
—
$
134
$
—
$
15,232
License and collaboration revenue
—
—
—
2,912
Sale of COPIKTRA license and related
assets revenue
545
—
1,447
70,000
Transition services revenue
—
372
606
372
Total revenue
545
506
2,053
88,516
Operating expenses:
Cost of sales - product
—
12
—
1,765
Cost of sales - intangible
amortization
—
—
—
793
Cost of sales – sale of COPIKTRA license
and related assets
—
—
—
31,187
Research and development
11,396
10,153
39,347
41,376
Selling, general and administrative
5,660
7,095
24,115
62,755
Total operating expenses
17,056
17,260
63,462
137,876
Loss from operations
(16,511)
(16,754)
(61,409)
(49,360)
Other expense
—
—
—
(1,313)
Interest income
40
18
181
515
Interest expense
(10)
(1,354)
(9,972)
(15,794)
Loss on debt extinguishment
—
(1,580)
—
(1,580)
Net loss before income taxes
$
(16,481)
$
(19,670)
$
(71,200)
$
(67,532)
Income tax expense
—
194
—
194
Net loss
(16,481)
(19,864)
(71,200)
(67,726)
Net loss per share—basic and diluted
$
(0.09)
$
(0.12)
$
(0.41)
$
(0.44)
Weighted average common shares outstanding
used in computing:
Net loss per share – basic and diluted
182,672
169,902
174,406
153,330
Verastem Oncology
Reconciliation of GAAP to
Non-GAAP Financial Information
(in thousands, except per share
amounts)
(unaudited)
Three months ended December
31,
Year ended December
31,
2021
2020
2021
2020
Net loss reconciliation
Net loss (GAAP basis)
$
(16,481)
$
(19,864)
$
(71,200)
$
(67,726)
Adjust:
Amortization of acquired intangible
asset
—
—
—
793
Stock-based compensation expense
1,574
2,933
7,711
8,118
Non-cash interest, net
44
554
9,331
10,319
Severance and Other
—
(160)
40
4,621
Change in fair value of derivative
—
—
—
1,313
Chugai license payment
—
—
—
3,000
Loss on debt extinguishment
—
1,580
—
1,580
Notes third party exchange costs
—
171
—
171
Adjusted net loss (non-GAAP
basis)
$
(14,863)
$
(14,786)
$
(54,118)
$
(37,811)
Reconciliation of Net loss Per
Share
Net loss per share – diluted (GAAP
Basis)
$
(0.09)
$
(0.12)
$
(0.41)
$
(0.44)
Adjust per diluted share
Amortization of acquired intangible
asset
—
—
—
—
Stock-based compensation expense
0.01
0.02
0.04
0.05
Non-cash interest, net
—
—
0.06
0.07
Severance and Other
—
—
—
0.03
Change in fair value of derivative
—
—
—
0.01
Chugai license payment
—
—
—
0.02
Loss on debt extinguishment
—
0.01
—
0.01
Notes third party exchange costs
—
—
—
—
Adjusted net loss per share –
diluted
(non-GAAP Basis)
$
(0.08)
$
(0.09)
$
(0.31)
$
(0.25)
Weighted average common shares outstanding
used in computing net loss per share—diluted
182,672
169,902
174,406
153,330
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220328005166/en/
Investors:
Ajay Munshi Vice President, Corporate Development +1
781-469-1579 amunshi@verastem.com
Nate LiaBraaten +1 212-600-1902 nate@argotpartners.com
Media:
Lisa Buffington Corporate Communications +1 781-292-4205
lbuffington@verastem.com
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