ALX Oncology Holdings Inc., (“ALX Oncology” or “the Company”)
(Nasdaq: ALXO), an immuno-oncology company developing therapies
that block the CD47 immune checkpoint pathway, today reported
financial results for the third quarter ended September 30, 2023,
and provided a corporate update.
Third Quarter 2023 Highlights and Recent
Developments
- Reported positive interim Phase 2
ASPEN-06 clinical trial results for evorpacept for the treatment of
advanced HER2-positive gastric/gastroesophageal junction (“GEJ”)
cancer.
- Completed public offering generating
gross proceeds of approximately $63.2 million.
- Realigned leadership team to match
platform asset evorpacept’s maturing portfolio of programs and
refined long-term development strategy.
- Advanced pipeline of nine programs
evaluating evorpacept in combination with anti-cancer antibodies,
antibody-drug conjugates (“ADCs”), and PD-1/PD-L1 immune checkpoint
inhibitors.
- Commenced assessment of indications for
future clinical studies where standard of care and market
opportunities maximize evorpacept’s potential.
“This past quarter proved to be an important growth milestone
for the Company highlighted by the outstanding interim results from
the ASPEN-06 phase 2 clinical trial which again demonstrated
evorpacept’s best-in-class safety profile and unique mechanism of
action,” commented Jason Lettmann, Chief Executive Officer of ALX
Oncology. “With this additional clinical validation in gastric
cancer and having completed an oversubscribed public offering, we
are now accelerating our portfolio of clinical programs combining
evorpacept with anti-cancer antibodies as well as with ADCs and
PD-1/PD-L1 immune checkpoint inhibitors and are heading into the
final months of 2023 with a great deal of momentum.”
Evorpacept Pipeline Update
Throughout the third quarter, the Company continued to advance
its pipeline of proprietary and partnered programs addressing
multiple hematologic and solid malignancies. In October 2023, the
Company reported positive interim Phase 2 data from the ASPEN-06
clinical trial, a randomized multi-center international study
evaluating evorpacept in combination with trastuzumab, CYRAMZA®
(ramucirumab) and paclitaxel for the treatment of patients with
HER2-positive gastric/GEJ cancer, which is the first randomized
clinical trial to show activity in the solid tumor setting in the
CD47 space. This prespecified interim analysis represented results
from 54 randomized patients with second and third line gastric/GEJ
cancer, including a meaningful number of patients previously
treated with ENHERTU® (trastuzumab deruxtecan) and checkpoint
inhibitors. Patients were treated with evorpacept at 30 mg/kg every
two weeks, mirroring the treatment cycle of trastuzumab, CYRAMZA
and paclitaxel.
To summarize the key findings, a confirmed overall response rate
(“ORR”) of 52% was demonstrated for the evorpacept combination
treatment arm compared to 22% for the control group of trastuzumab
+ CYRAMZA + paclitaxel; median duration of response (“mDOR”) was
not reached for the evorpacept combination treatment arm compared
to 7.4 months for the control group; and the safety profile of
evorpacept was consistent with the Company’s previous clinical
trials and was well-tolerated. Furthermore, the interim results
compare favorably to the efficacy reported for CYRAMZA + paclitaxel
in the RAINBOW study (ORR of 28% and mDOR of 4.4 months), which is
the regulatory benchmark and global standard of care for second
line gastric/GEJ cancer.
Upcoming Clinical Milestones for
Evorpacept’s Development Pipeline
- 1H 2024
- Non-Hodgkin
Lymphoma – Phase 1b investigator-sponsored trial with rituximab +
lenalidomide top line results (Q1/Q2 2024)
- Gastric/GEJ Cancer
– Phase 2 ASPEN-06 randomized top line final results (Q2 2024)
- 2H 2024
- Head and Neck
Squamous Cell Carcinoma – Phase 2 ASPEN-03 with KEYTRUDA randomized
top line results
- Head and Neck
Squamous Cell Carcinoma – Phase 2 ASPEN-04 with KEYTRUDA +
chemotherapy randomized top line results
- Gastric/GEJ Cancer
– Phase 3 ASPEN-06 study initiation
- Urothelial
Carcinoma – Phase 1b ASPEN-07 with PADCEV® (enfortumab
vedotin-ejfv) top line results
- Breast Cancer –
Phase 1b I-SPY study with ENHERTU top line results
Corporate Update
ALX Oncology achieved a significant corporate development
milestone during the third quarter with the realignment of the
Company’s leadership team. Jason Lettmann, who has been involved
with ALX Oncology for nearly a decade since its founding, having
co-led the Company’s first institutional financing and serving as a
member of its Board of Directors since 2015, was appointed Chief
Executive Officer in September 2023. In turn, Dr. Jaume Pons who
founded ALX Oncology and served as its Chief Executive Officer
since inception, transitioned to the role of President and Chief
Scientific Officer. This represents an important growth milestone
for the Company as it signifies the clinical maturity of
evorpacept’s portfolio of therapeutic candidates and enables Dr.
Pons to focus on pipeline extension opportunities while continuing
to generate scientific support for the platform asset.
An additional recent highlight was the closing of an
underwritten public offering of common stock and pre-funded
warrants in October 2023 which provided ALX Oncology with gross
proceeds of approximately $63.2 million. The Company sold 8,663,793
shares of common stock, which included 1,293,103 shares of common
stock pursuant to the full exercise of the underwriters’ option to
purchase additional shares and, in lieu of common stock to certain
investors, pre-funded warrants to purchase 1,250,000 shares of
common stock in the offering. The shares of common stock were sold
at a public offering price of $6.38 per share (the closing price on
October 4, 2023), and the pre-funded warrants were sold at a public
offering price of $6.379 per pre-funded warrant.
Third Quarter 2023 Financial Results:
- Cash, Cash Equivalents and
Investments: Cash, cash equivalents and investments as of
September 30, 2023, were $196.4 million. ALX Oncology believes its
cash, cash equivalents, and investments along with the ability to
draw down an additional $40 million of its term loan and the net
proceeds from its recent public offering are sufficient to fund
planned operations into early 2026.
- Research and Development
(“R&D”) Expenses: R&D expenses consist primarily
of pre-clinical, clinical and manufacturing expenses related to the
development of the Company’s current lead product candidate,
evorpacept, and R&D employee-related expenses. These expenses
for the three months ended September 30, 2023, were $45.8 million,
compared to $29.4 million for the prior-year period. The increase
was primarily attributable to an increase of $16.4 million in
clinical costs from an increase in the number of active trials and
patient enrollment as well as manufacturing of clinical trial
materials to support a higher number of active clinical trials and
future expected patient enrollment related to the advancement of
evorpacept.
- General and Administrative
(“G&A”) Expenses: G&A expenses consist primarily
of administrative employee-related expenses, legal and other
professional fees, patent filing and maintenance fees, and
insurance. These expenses for the three months ended September 30,
2023, were $7.5 million, compared to $7.3 million for the prior
year period.
- Net loss: GAAP net
loss was $51.0 million for the third quarter ended September 30,
2023, or $1.24 per basic and diluted share, as compared to a GAAP
net loss of $35.3 million for the third quarter ended September 30,
2022, or $0.87 per basic and diluted share. Non-GAAP net loss was
$44.0 million for the third quarter ended September 30, 2023, as
compared to a non-GAAP net loss of $29.1 million for the third
quarter ended September 30, 2022. A reconciliation of GAAP to
non-GAAP financial results can be found at the end of this news
release.
About ALX Oncology
ALX Oncology is a publicly traded, clinical-stage
immuno-oncology company focused on helping patients fight cancer by
developing therapies that block the CD47 immune checkpoint
inhibitor and bridge the innate and adaptive immune system. ALX
Oncology’s lead product candidate, evorpacept, is a next generation
CD47 blocking therapeutic that combines a high-affinity CD47
binding domain with an inactivated, proprietary Fc domain.
Evorpacept has demonstrated promising clinical responses across a
range of hematologic and solid malignancies in combination with a
number of leading anti-cancer antibodies. ALX Oncology is currently
focusing on combining evorpacept with anti-cancer antibodies, ADCs,
and PD-1/PD-L1 immune checkpoint inhibitors.
Evorpacept’s Unique Profile: Anchored by a Rational
Design and Dual Development Pillars
Rationally engineered with an inactive Fc effector function,
evorpacept’s clinical data to date has demonstrated a substantially
improved safety profile over other anti-CD47 molecules in the
clinic with an active Fc (i.e., binding the Fc gamma receptor on
macrophages). This best-in-class safety profile allows for higher
dosage with minimal overlapping toxicity in the combination
treatment setting. CD47 expressed on cancer cells binds to its
receptor SIRP alpha, which is predominantly expressed on two cell
types: macrophages and dendritic cells. The Company’s pipeline of
therapeutic candidates with standard-of-care agents include:
Anti-cancer antibodies (the “don’t eat
me” signal): evorpacept enables
Fc-mediated antibody-dependent phagocytosis by macrophages in
combination with anti-cancer antibodies (e.g., Herceptin®) with an
active Fc domain, which is otherwise impaired by CD47 expression on
cancer cells binding to SIRP alpha on macrophages. This same
mechanism of action applies to ADCs.
PD-1/PD-L1 immune checkpoint inhibitors (the
“don’t activate T-cells”
signal): evorpacept enables T-cell activation by dendritic
cells that are constitutively inhibited by CD47 expression on
cancer cells binding to SIRP alpha on dendritic cells. Activated
dendritic cells present neoantigens to T-cells that once activated
will kill cancer cells when the PD-1/PD-L1 inhibitory interaction
is blocked by T-cell checkpoint inhibitors.
Cautionary Note Regarding Forward-Looking
Statements
This press release contains forward-looking statements that
involve substantial risks and uncertainties. Forward-looking
statements include statements regarding future results of
operations and financial position, business strategy, product
candidates, planned preclinical studies and clinical trials,
results of clinical trials, research and development costs,
regulatory approvals, timing and likelihood of success, plans and
objects of management for future operations, as well as statements
regarding industry trends. Such forward-looking statements are
based on ALX Oncology’s beliefs and assumptions and on information
currently available to it on the date of this press release.
Forward-looking statements may involve known and unknown risks,
uncertainties and other factors that may cause ALX Oncology’s
actual results, performance or achievements to be materially
different from those expressed or implied by the forward-looking
statements. These and other risks are described more fully in ALX
Oncology’s filings with the Securities and Exchange Commission
(“SEC”), including ALX Oncology’s Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and other documents ALX Oncology
files with the SEC from time to time. Except to the extent required
by law, ALX Oncology undertakes no obligation to update such
statements to reflect events that occur or circumstances that exist
after the date on which they were made.
ALX ONCOLOGY HOLDINGS
INC.Condensed Consolidated Statements of
Operations(unaudited)(in thousands, except share and per
share amounts)
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
$ |
45,766 |
|
|
$ |
29,382 |
|
|
$ |
100,011 |
|
|
$ |
73,203 |
|
General and administrative |
|
|
7,509 |
|
|
|
7,299 |
|
|
|
22,244 |
|
|
|
22,014 |
|
Total operating expenses |
|
|
53,275 |
|
|
|
36,681 |
|
|
|
122,255 |
|
|
|
95,217 |
|
Loss
from operations |
|
|
(53,275 |
) |
|
|
(36,681 |
) |
|
|
(122,255 |
) |
|
|
(95,217 |
) |
Interest income |
|
|
2,677 |
|
|
|
1,370 |
|
|
|
7,654 |
|
|
|
2,471 |
|
Interest expense |
|
|
(391 |
) |
|
|
(2 |
) |
|
|
(1,150 |
) |
|
|
(7 |
) |
Other income (expense), net |
|
|
(1 |
) |
|
|
(7 |
) |
|
|
418 |
|
|
|
(20 |
) |
Loss
before income taxes |
|
|
(50,990 |
) |
|
|
(35,320 |
) |
|
|
(115,333 |
) |
|
|
(92,773 |
) |
Income
tax (provision) benefit |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
Net
loss |
|
$ |
(50,990 |
) |
|
$ |
(35,320 |
) |
|
$ |
(115,333 |
) |
|
$ |
(92,773 |
) |
Net loss
per share, basic and diluted |
|
$ |
(1.24 |
) |
|
$ |
(0.87 |
) |
|
$ |
(2.82 |
) |
|
$ |
(2.28 |
) |
Weighted-average shares of common stock used to compute net
loss per shares, basic and diluted |
|
|
41,147,938 |
|
|
|
40,747,026 |
|
|
|
40,963,015 |
|
|
|
40,684,172 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Balance Sheet
Data(unaudited)(in thousands)
|
|
September 30, |
|
|
December 31, |
|
|
|
2023 |
|
|
2022 |
|
Cash, cash equivalents and investments |
|
$ |
196,444 |
|
|
$ |
282,906 |
|
Total assets |
|
$ |
220,107 |
|
|
$ |
306,489 |
|
Total liabilities |
|
$ |
51,355 |
|
|
$ |
43,025 |
|
Accumulated deficit |
|
$ |
(440,800 |
) |
|
$ |
(325,467 |
) |
Total stockholders’ equity |
|
$ |
168,752 |
|
|
$ |
263,464 |
|
|
|
|
|
|
|
|
|
|
GAAP to Non-GAAP Reconciliation
(unaudited) (in thousands)
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
GAAP net loss, as reported |
|
$ |
(50,990 |
) |
|
$ |
(35,320 |
) |
|
$ |
(115,333 |
) |
|
$ |
(92,773 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation expense |
|
|
6,964 |
|
|
|
6,207 |
|
|
|
19,552 |
|
|
|
17,544 |
|
Accretion of term loan discount and issuance costs |
|
|
63 |
|
|
|
— |
|
|
|
186 |
|
|
|
— |
|
Total adjustments |
|
|
7,027 |
|
|
|
6,207 |
|
|
|
19,738 |
|
|
|
17,544 |
|
Non-GAAP
net loss |
|
$ |
(43,963 |
) |
|
$ |
(29,113 |
) |
|
$ |
(95,595 |
) |
|
$ |
(75,229 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Use of Non-GAAP Financial Measures
We supplement our consolidated financial statements presented on
a GAAP basis by providing additional measures which may be
considered “non-GAAP” financial measures under applicable SEC
rules. We believe that the disclosure of these non-GAAP financial
measures provides our investors with additional information that
reflects the amounts and financial basis upon which our management
assesses and operates our business. These non-GAAP financial
measures are not in accordance with generally accepted accounting
principles and should not be viewed in isolation or as a substitute
for reported, or GAAP, net loss, and are not a substitute for, or
superior to, measures of financial performance performed in
conformity with GAAP.
“Non-GAAP net loss” is not based on any standardized methodology
prescribed by GAAP and represents GAAP net loss adjusted to exclude
stock-based compensation expense and accretion of term loan
discount and issuance costs. Non-GAAP financial measures used by
ALX Oncology may be calculated differently from, and therefore may
not be comparable to, non-GAAP measures used by other
companies.
Investor Contact:
Peter Garcia
Chief Financial Officer, ALX Oncology
(650) 466-7125 Ext. 113
peter@alxoncology.com
Malini Chatterjee, Ph.D.
Blueprint Life Science Group
mchatterjee@bplifescience.com
Media Contact:
Karen Sharma
MacDougall
(781) 235-3060
alx@macbiocom.com
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