Aduro Biotech Provides Business Update and Reports First Quarter 2020 Financial Results
“We ended the first quarter of 2020 with a cash position of
- Announced corporate restructuring to reduce operating expenses and extend cash runway into 2023.
- Received a
$10 milliondevelopment milestone payment from license partner, Merck & Co., Inc. (known as MSD outside the United Statesand Canada) (Merck). The payment was received as a result of Merck’s initiation of a Phase 2 clinical trial of MK-5890, the anti-CD27 agonist antibody licensed to Merck in 2014, in patients with advanced squamous or non-squamous non-small cell lung cancer (NSCLC) that have been previously treated with anti-PD-L1 therapy.
- Announced an update on clinical trial timelines and business operations in light of the COVID-19 global pandemic.
º We expect delays in activating additional sites and enrolling patients into Part 3 of the Phase 1 clinical trial of BION-1301 in IgA nephropathy. As a result, our ability to report data in IgA nephropathy patients will likely be delayed until the first half of 2021.
º Despite some delays in additional site activation and patient enrollment and anticipated delays in patient follow-up and data analysis, we expect to present interim data for the ongoing Phase 2 clinical trial evaluating ADU-S100 and pembrolizumab in SCCHN in the second half of 2020.
º We are continuing preparations to initiate a Phase 1 clinical trial evaluating ADU-S100 as an intravesical monotherapy for non-muscle invasive bladder cancer in the second half of 2020. However, study start-up activities may be delayed.
- Cash Position – Cash, cash equivalents and marketable securities totaled
$205.9 millionat March 31, 2020, compared to $213.6 millionat December 31, 2019.
- Revenue – Revenue was
$14.0 millionfor the first quarter of 2020 compared to $3.9 millionfor the same period in 2019. The increase in revenue for the quarter was primarily due to recognition of the $10.0 milliondevelopment milestone payment received under our license and research agreement with Merck.
- Expenses –
º Research and development expenses were
$15.8 millionfor the first quarter of 2020 compared to $17.5 millionfor the same period in 2019. The quarter to date costs decreased primarily due to lower costs related to our programs that are winding down partially offset by higher costs as a result of focused spending towards our STINGand APRIL programs. The decrease was also attributable to lower compensation and related personnel costs as well as stock-based compensation as compared to 2019.
º General and administrative expenses were
$7.8 millionfor the first quarter of 2020 compared to $8.2 millionfor the same period in 2019. The quarter to date costs decreased primarily due to lower personnel and stock-based compensation expense, as compared to 2019.
º Restructuring and related expense was
$4.3 millionfor the first quarter of 2020 compared to $3.0 millionfor the same period in 2019. The 2020 restructuring and related expenses consisted of severance and employee retention costs as well as the impairment of property and equipment associated with the planned closure of the Oss facility as part of the January 2020restructuring plan. The $3.0 millionrestructuring and related expense recorded in 2019, which includes employee severance and retention payments, related to the January 2019strategic reset.
- Net Loss – Net loss for the first quarter of 2020 was
$7.6 millionor $0.09per share compared to net loss of $23.4 millionor $0.29per share for the same period in 2019. In addition to the factors described above, the net loss was offset by approximately $5.7 millionof income tax benefit related to an income tax refund resulting from the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The income tax refund is expected to be received in the second half of 2020.
Cautionary Note on Forward-Looking Statements
This press release contains forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements regarding our current intentions or expectations concerning, among other things, the potential for our technology, continued advancement of our programs, timelines for our programs, including expected timing for presentations of clinical data, expected delays resulting from COVID-19, our focus on our
Consolidated Statements of Operations
(In thousands, except share and per share amounts)
|Three Months Ended March 31,|
|Collaboration and license revenue||$||13,950||$||3,938|
|Research and development(1)||15,828||17,494|
|General and administrative(1)||7,819||8,224|
|Restructuring and related expense||4,308||2,994|
|Amortization of intangible assets||136||140|
|Total operating expenses||28,091||28,852|
|Loss from operations||(14,141||)||(24,914||)|
|Other expense, net||(19||)||(19||)|
|Total other income||901||1,452|
|Loss before income tax||(13,240||)||(23,462||)|
|Income tax benefit||5,665||35|
|Net loss per common share, basic and diluted||$||(0.09||)||$||(0.29||)|
|Shares used in computing net loss per common share, basic and diluted||80,757,801||79,673,294|
|(1) Includes the following share-based compensation expenses:|
|Research and development||863||2,033|
|General and administrative||1,172||1,670|
Consolidated Balance Sheets
|Cash and cash equivalents||$||94,381||$||59,624|
|Income tax receivable||5,665||—|
|Prepaid expenses and other current assets||2,676||3,958|
|Total current assets||212,314||217,902|
|Property and equipment, net||22,492||24,688|
|Operating lease right-of-use assets||20,722||21,110|
|Intangible assets, net||18,478||18,978|
|Liabilities and Stockholders’ Equity|
|Accrued clinical trial and manufacturing expenses||4,823||4,253|
|Accrued expenses and other liabilities||10,116||8,181|
|Operating lease liabilities||1,765||1,803|
|Total current liabilities||23,264||21,601|
|Deferred tax liabilities||3,459||3,527|
|Operating lease liabilities||31,258||31,636|
|Other long-term liabilities||753||940|
|Commitments and contingencies|
|Additional paid-in capital||554,192||552,077|
|Accumulated other comprehensive income||(140||)||414|
|Total stockholders’ equity||59,581||65,595|
|Total liabilities and stockholders’ equity||$||285,495||$||291,313|
Source: Aduro Biotech, Inc.