BOSTON, April 6, 2021 /PRNewswire/ -- Stealth
BioTherapeutics Corp (Nasdaq: MITO), a clinical-stage biotechnology
company focused on the discovery, development, and
commercialization of novel therapies for diseases involving
mitochondrial dysfunction, today reported financial results for the
year ended December 31, 2020 and
announced recent business highlights.
"As we look forward to data from our fully-enrolled Phase 2
program in dry age-related macular degeneration during the first
half of 2022, we are poised to progress our planned clinical
expansion into rare metabolic cardiomyopathies and neurological
diseases, with multiple trial initiations expected this year," said
Reenie McCarthy, Chief Executive
Officer at Stealth. "Our recent and ongoing discussions with FDA
may result in a delay in our Barth NDA submission, but helped
identify options to generate additional data we believe may support
a filing within a reasonable time-frame. We appreciate the
strong engagement by senior Division and Office level FDA
personnel, and we believe that our learnings from this program will
help inform our approach to larger rare cardiomyopathic disease
indications."
Fourth Quarter 2020 and Recent Highlights
- Barth syndrome. In January
2021, the Company announced that it had met with the
Division of Cardiology and Nephrology (DCN) to discuss its Barth
development program and planned submission of its New Drug
Application (NDA) for the treatment of cardiomyopathy in Barth
syndrome. In late February 2021 and
in early April 2021, the Company met
again with DCN to discuss both matters. FDA expressed its view that
the existing clinical data are insufficient to demonstrate
substantial evidence of effectiveness and do not support NDA
review, and suggested potential paths forward to generate
additional data, including by a randomized withdrawal of therapy
from patients in the Company's ongoing open label extension trial
and from additional potential patients the Company could
enroll. The Company has not yet received a record of this
meeting. The Company is evaluating the proposed withdrawal
protocol among other potential next steps.
- In late 2020, the Barth Syndrome Foundation, which is the
global advocacy group representing Barth patients, announced its
petition requesting the Company to submit and the FDA to review an
NDA for elamipretide for the treatment of Barth. On March 3, 2021, the Barth Syndrome Foundation
announced that DCN and other FDA representatives attended a
March 3 listening session requested
by members of the Barth syndrome community. The listening session
was a first-of-its-kind engagement in which the FDA sought to
understand the level of uncertainty Barth patients would accept
regarding the effectiveness of new therapies, which is a type of
flexibility FDA's December 2019
Guidance for Industry: Demonstrating Substantial Evidence of
Effectiveness recommends the FDA consider in rare disease
settings.
- Geographic atrophy. In February
2021, the Company announced that it had completed enrollment
of 176 patients in its ReCLAIM-2 Phase 2b clinical trial in patients with geographic
atrophy. This milestone triggered the payment of an additional
$10 million of development funding to
the Company under the Development Funding Agreement announced in
November 2020. Design and preliminary
baseline demographics for the ReCLAIM-2 trial were presented at
Angiogenesis, Exudation, and Degeneration 2021 in February 2021.
- SBT-272. As previously reported, data presented at
the 2020 Annual NEALS Meeting demonstrated that SBT-272 improved
neurite length and branching in mutant TDP43 primary upper motor
neurons. TDP43 pathology, which is believed to play a role in
neuronal cell death, has been observed in multiple
neurodegenerative diseases, including Amyotrophic Lateral
Sclerosis, Frontotemporal Lobar Degeneration, Lewy Body Dementia,
Progressive Supranuclear Palsy, and Alzheimer's Disease. The
Company is conducting toxicology studies to support a potential
Phase 2a clinical study in patients with neurological disease in
2022.
- Development Funding Agreement. In November 2020, the Company announced the first
closing under a Development Funding Agreement to support the
clinical development of elamipretide. To date, the Company has
received $30 million and is eligible
to receive an additional $5 million
on submission of an NDA for the treatment of cardiomyopathy in
Barth syndrome.
- Registered Direct Offerings. In November 2020, the Company received gross
proceeds of $3.2M from the registered
direct offering of 2,844,446 ADSs. In February 2021, the Company received gross
proceeds of $4.7 million from the
registered direct offering of 2,339,000 ADSs.
Key Upcoming Milestones
- Geographic atrophy: Data expected in Q2 2022.
- Expansion of cardiomyopathy franchise: A Phase 2a
investigator-initiated open-label clinical trial assessing
elamipretide in a cohort of patients affected by visual decline
and/or cardiomyopathy associated with Friedreich's ataxia is
expected to commence during Q2 2021. The Company anticipates that
data from this trial will help inform pivotal trial design. A
meeting with the FDA to discuss protocol design for a trial to
evaluate elamipretide in patients with cardiomyopathy associated
with Duchenne muscular dystrophy is expected during Q3 2021.
- Initiation of Phase 3 clinical trial in rare mitochondrial
diseases caused by nuclear DNA (nDNA) mutations: The
Company plans to meet with the FDA during Q2 2021 prior to
initiating a Phase 3 clinical trial in the prespecified subgroup of
primary mitochondrial disease patients with nDNA mutations who
appeared to respond to elamipretide therapy in the Company's Phase
3 trial in primary mitochondrial myopathy.
- Expansion of neurology franchise: The Company is
continuing its neurology pipeline expansion efforts with SBT-272
and a group of compounds from its SBT-550 series and expects to
announce results of SBT-272 preclinical studies and initiation of
SBT-550 pre-IND enabling studies during 2021.
Financial Results for the year ended December 31, 2020
Cash Position: Cash and cash equivalents were
$32.8 million at December 31, 2020, compared to $50.8 million at December
31, 2019. In February 2021,
the Company received $10.0 million
under the Development Funding Agreement with Morningside
Venture (I) Investments Ltd., as a result of the tranche 2
milestone event upon completing enrollment in its ReCLAIM-2 Phase 2
clinical trial of elamipretide for the treatment of dry AMD and
gross proceeds of $4.7 million from a
registered direct offering of its ADSs.
Revenue: We did not have any revenue in 2020 compared to
$21.1 million of revenue in 2019.
Revenue in 2019 represents non-refundable upfront payments under
the Alexion Arrangement that were recognized in full in accordance
with applicable accounting standards as we completed our
performance obligation in 2019. Alexion terminated the Agreement in
January 2020, and as such, no
additional revenue will be recognized under the Alexion
Arrangement.
Research and Development (R&D) Expenses: R&D
expenses decreased by $15.3 million
to $29.3 million for the year ended
December 31, 2020, from $44.6 million for the year ended December 31, 2019. This decrease was primarily
due to a net decrease of $8.7 million
in employee and consultant related costs attributable to the
strategic repositioning implemented in Q1 2020, a $3.2 million decrease in contract manufacturing,
a $1.8 million net decrease in
clinical costs primarily driven by the closeout of our Primary
Mitochondrial Myopathy development efforts which ended in
December 2019, a $1.4 million decrease in preclinical costs and a
$0.2 million net decrease in
regulatory costs.
General and Administrative (G&A) Expenses: G&A
expenses decreased by $2.9 million to
$19.4 million for the year ended
December 31, 2020, from $22.3 million for the year ended December 31, 2019. The increase was primarily
attributable to a decrease of $4.3
million in pre-commercial activities offset in part by a
$1.4 million increase in professional
services for various financing transactions and increased costs of
insurance.
Other Expense: Other expense decreased by $17.1 million to $8.8 million for the year ended December 31, 2020 from $25.9 million for the year ended
December 31, 2019. Other
expense in 2020 consisted of a $7.1
million non-cash expense due to the change in fair value of
the derivative liability and $1.8
million in interest expense offset by $0.1 million in interest income. Other
expense in 2019 consisted of a $22.7
million loss on extinguishment of debt recorded in
conjunction with the IPO, $6.7
million in interest expense mostly related to convertible
debt and $0.3 million loss due to the
change in fair value of the warrant liability offset in part by a
$2.8 million gain from the fair value
adjustment of the derivative liability associated with the
convertible debt and $1.0 million in
interest income.
Conference Call
Management will host a conference call today at 8:30 am ET to discuss the financial results and
provide a general business update. The call can be accessed by
dialing (877)-407-0989 (domestic) or (201)-389-0921 (international)
and referencing conference ID 13717131. A live audio webcast of the
event can be accessed by visiting the Investors & News section
of Stealth's Investor website, https://investor.stealthbt.com/. A
replay of the webcast will be archived on Stealth's website for 30
days following the event.
About Stealth
We are a clinical-stage biotechnology company focused on the
discovery, development, and commercialization of novel therapies
for diseases involving mitochondrial dysfunction. Mitochondria,
found in nearly every cell in the body, are the body's main source
of energy production and are critical for normal organ function.
Dysfunctional mitochondria characterize a number of rare genetic
diseases and are involved in many common age-related diseases,
typically involving organ systems with high energy demands such as
the heart, the eye, and the brain. We believe our lead product
candidate, elamipretide, has the potential to treat both rare
metabolic cardiomyopathies, such as Barth, Duchenne muscular
dystrophy and Friedreich's ataxia, rare mitochondrial diseases
entailing nuclear DNA mutations, as well as ophthalmic diseases
entailing mitochondrial dysfunction, such as dry age-related
macular degeneration and Leber's hereditary optic neuropathy. We
are evaluating our second-generation clinical-stage candidate,
SBT-272, and our new series of small molecules, SBT-550, for rare
neurological disease indications following promising preclinical
data. We have optimized our discovery platform to identify novel
mitochondria-targeted compounds which may be nominated as
therapeutic product candidates or utilized as mitochondria-targeted
vectors to deliver other compounds to mitochondria.
Forward-looking Statements
This press release contains forward-looking statements within
the meaning of The Private Securities Litigation Reform Act of
1995. Such forward-looking statements include those regarding
Stealth BioTherapeutics' plans, strategies and expectations for its
preclinical and clinical advancement of its drug development
programs, including its ongoing clinical trials of elamipretide and
planned clinical trial of SBT-272; its plans for a potential
submission of an NDA; its expectations regarding regulatory
interactions, including its evaluation of the possibility that
existing data and the data from the withdrawal protocol may provide
sufficient evidence to support NDA review; the potential benefits
of Stealth BioTherapeutics' product candidates; its key milestones
for 2021 and 2022; and its plans regarding future data
presentations. Statements that are not historical facts, including
statements about Stealth BioTherapeutics' beliefs, plans and
expectations, are forward-looking statements. The words
"anticipate," "expect," "hope," "plan," "potential," "possible,"
"will," "believe," "estimate," "intend," "may," "predict,"
"project," "would" and similar expressions are intended to identify
forward-looking statements, although not all forward-looking
statements contain these identifying words. Stealth BioTherapeutics
may not actually achieve the plans, intentions or expectations
disclosed in these forward-looking statements, and you should not
place undue reliance on these forward-looking statements. Actual
results or events could differ materially from the plans,
intentions and expectations disclosed in the forward-looking
statements as a result of known and unknown risks, uncertainties
and other important factors, including: Stealth BioTherapeutics'
ability to obtain additional funding and to continue as a going
concern; the impact of the COVID-19 pandemic; the ability to
successfully demonstrate the efficacy and safety of Stealth
BioTherapeutics' product candidates and future product candidates;
the preclinical and clinical results for Stealth BioTherapeutics'
product candidates, which may not support further development and
marketing approval; the potential advantages of Stealth
BioTherapeutics' product candidates; the content and timing of
decisions made by the FDA, the EMA or other regulatory authorities,
investigational review boards at clinical trial sites and
publication review bodies, which may affect the initiation, timing
and progress of preclinical studies and clinical trials of Stealth
BioTherapeutics product candidates; Stealth BioTherapeutics'
ability to obtain and maintain requisite regulatory approvals and
to enroll patients in its planned clinical trials; unplanned cash
requirements and expenditures; competitive factors; Stealth
BioTherapeutics' ability to obtain, maintain and enforce patent and
other intellectual property protection for any product candidates
it is developing; and general economic and market conditions. These
and other risks are described in greater detail under the caption
"Risk Factors" included in the Stealth BioTherapeutics' most recent
Annual Report on Form 20-F filed with the Securities and Exchange
Commission ("SEC"), as well as in any future filings with the SEC.
Forward-looking statements represent management's current
expectations and are inherently uncertain. Except as required by
law, Stealth BioTherapeutics does not undertake any obligation to
update forward-looking statements made by us to reflect subsequent
events or circumstances.
Investor Relations
Stern Investor Relations
Janhavi Mohite, 212-362-1200
IR@StealthBT.com
STEALTH
BIOTHERAPEUTICS CORP
|
Consolidated
Balance Sheets
|
(in thousands)
|
(unaudited)
|
|
|
December
31,
|
|
December
31,
|
|
|
2020
|
|
2019
|
Assets
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents (a)
|
|
$
32,787
|
|
$
50,768
|
Prepaid expenses and
other current assets
|
|
2,253
|
|
1,630
|
Total current
assets
|
|
35,040
|
|
52,398
|
Property and
equipment, net
|
|
106
|
|
345
|
Deferred financing
costs and other non-current assets
|
|
702
|
|
—
|
Total
assets
|
|
$
35,848
|
|
$
52,743
|
Liabilities and
shareholders' equity (deficit)
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
3,526
|
|
$
9,520
|
Accrued expenses and
other current liabilities
|
|
7,024
|
|
8,495
|
Accrued interest
payable
|
|
1,499
|
|
1,219
|
Current portion of
long-term debt
|
|
9,000
|
|
14,716
|
Total current
liabilities
|
|
21,049
|
|
33,950
|
Long-term debt, less
current portion
|
|
—
|
|
1,526
|
Long-term deferred
rent, less current portion
|
|
16
|
|
—
|
Development
derivative liability - related party
|
|
25,155
|
|
—
|
Total
liabilities
|
|
46,220
|
|
35,476
|
Total shareholders'
equity (deficit)
|
|
(10,372)
|
|
17,267
|
Total liabilities
and shareholders' equity (deficit)
|
|
$
35,848
|
|
$
52,743
|
(a)
|
Pursuant to the
Development Funding Agreement, an additional $10.0M was received
from Morningside Venture (I) Investments Ltd. upon the completion
of enrollment of our RECLAIM-2 Phase 2 clinical trial of
elamipretide for the treatment of Dry AMD in February 2021.
Additionally, gross proceeds of $4.7 million from a registered
direct offering of the Company's ADSs were also received in
February 2021.
|
STEALTH
BIOTHERAPEUTICS CORP
|
Consolidated
Statements of Operations
|
(in thousands, except share and per share data)
|
(unaudited)
|
|
|
Year Ended
December 31,
|
|
|
2020
|
|
2019
|
|
|
|
|
|
Revenue
|
|
$
—
|
|
$
21,087
|
Operating
expenses:
|
|
|
|
|
Research and
development
|
|
29,305
|
|
44,604
|
General and
administrative
|
|
19,366
|
|
22,315
|
Total operating
expenses
|
|
48,671
|
|
66,919
|
Loss from
operations
|
|
(48,671)
|
|
(45,832)
|
Other income
(expense):
|
|
|
|
|
Loss on
extinguishment of debt
|
|
—
|
|
(22,700)
|
Change in fair value
of derivative liability
|
|
(7,117)
|
|
2,782
|
Change in fair value
of warrant liability
|
|
—
|
|
(300)
|
Interest
income
|
|
139
|
|
988
|
Interest expense and
other
|
|
(1,808)
|
|
(6,666)
|
Total other
expense
|
|
(8,786)
|
|
(25,896)
|
Net loss attributable
to ordinary shareholders
|
|
$
(57,457)
|
|
$
(71,728)
|
Net loss per share
attributable to ordinary shareholders — basic and
diluted
|
|
$
(0.10)
|
|
$
(0.19)
|
Weighted average
ordinary shares used in net loss per share attributable to
ordinary shareholders — basic and diluted
|
|
556,169,255
|
|
375,669,759
|
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SOURCE Stealth BioTherapeutics Inc.