Aadi Bioscience Announces Financial Results for the First Quarter 2024 and Provides Corporate Update

Rhea-AI Summary

Aadi Bioscience, a precision oncology company, announced Q1 2024 financial results with FYARRO sales of $5.4 million. The PRECISION1 trial is fully enrolled, with an interim analysis planned for Q3 2024. Phase 2 trials in EEC and NETs are progressing well. Despite an 8.8% decrease in sales due to distributor patterns, FYARRO continues to be a preferred PEComa treatment. The company ended Q1 with $88.3 million in cash. A conference call will discuss these updates.

Positive

• FYARRO sales of $5.4 million in Q1 2024.

• PRECISION1 trial fully enrolled with interim analysis in Q3 2024.

• Phase 2 trials in EEC and NETs progressing well.

• FYARRO established as preferred PEComa treatment.

Negative

• 8.8% decrease in sales due to distributor patterns.

• Net loss of $18.3 million for Q1 2024.

Insights

Financial Analyst

Aadi Bioscience's first quarter report indicates a decrease in sales by 8.8% compared to the previous year, which is attributed to changes in distributor ordering patterns and a reduction in new patient initiations. While the company anticipates a correction in the following quarters, it's critical to monitor subsequent earnings reports for signs of recovery or further decline. The cash reserves are reportedly sufficient to fund operations into Q4 2025, which provides some financial stability. However, the net loss has increased year-over-year from $15.2 million to $18.3 million, a matter of concern for stakeholders interested in the company's profitability trajectory. The mention of ending the collaboration with Mirati/Bristol Myers Squibb could also suggest a strategic pivot or a need to focus resources on the most promising trials, aspects that require close scrutiny in upcoming updates.

Oncology Clinical Development Expert

The full enrollment of the PRECISION1 trial and the progress of Phase 2 trials in EEC and NETs represent significant milestones for Aadi Bioscience's clinical development strategy. The focus on nab-sirolimus, a targeted therapy for mTOR pathway alterations, caters to a niche yet critical area in precision oncology. The success of these trials could lead to substantial advancements in treatment options for patients with specific cancer subtypes. However, the termination of the collaboration with a major pharmaceutical player raises questions about the strategic implications and future partnership opportunities. Investors should keep an eye on the interim analysis due in Q3 2024, which will be indicative of the drug's efficacy and safety profile and will likely have a significant impact on the company's valuation.

Market Research Analyst

From a market perspective, the performance of FYARRO, especially given its recent market introduction and competitive positioning as a preferred treatment for malignant PEComa, is pivotal. The reported sales figures and the expected rebound in Q2 are important indicators of market acceptance and penetration. The acknowledgment of Q1 sales impacted by external factors, not product efficacy or market demand, provides a contextual understanding of the financial results. It's essential to assess how the company will sustain and scale up FYARRO's market presence, especially in the context of the terminated collaboration and the shifts in its clinical development focus. Monitoring the competitive landscape, including any emerging therapies targeting mTOR-driven cancers, will also help investors understand the potential for FYARRO's sustained growth.

Fully enrolled registration-intended PRECISION1 trial; two-thirds interim analysis planned for Q3 2024

FYARRO® sales of $5.4 million for Q1 2024, reflects distributor ordering patterns and fewer commercial patient initiations at the start of the year

Conference call to be held today at 8:30 am EDT

LOS ANGELES, May 8, 2024 /PRNewswire/ -- Aadi Bioscience, Inc. (NASDAQ: AADI), a commercial-stage, precision oncology company focused on developing and commercializing therapies for cancers with alterations in the mTOR pathway, today announced financial results for the first quarter ended March 31, 2024, and highlighted recent corporate progress.

"I'm pleased to announce that PRECISION1 is now fully enrolled across a broad array of tumor types and our promising development plan continues to gain momentum. We look forward to providing the two-thirds interim analysis in the third quarter, and full results in early 2025. Additionally, the recently initiated Phase 2 trials in EEC and NETs are enrolling well, and we anticipate initial data from these later this year," said Dave Lennon, President and CEO of Aadi Bioscience. "On the commercial side, FYARRO continues to perform well and has cemented its position as the preferred treatment for malignant PEComa after just two years on the market. The impacts to sales in the first quarter are well-understood events and we expect to return to sales growth in Q2."

Recent Operational Highlights

• FYARRO net product sales were $5.4 million in the first quarter of 2024. This decrease of 8.8% from the prior year period reflects impacts from distributor ordering patterns and fewer new patient initiations than the historical average, which we anticipate will correct in subsequent quarters.
  
  
• Registration-intended PRECISION1 trial is now fully enrolled. PRECISION1 is exploring nab-sirolimus in solid tumors with TSC1 or TSC2 inactivating alterations. The two-thirds interim analysis is expected in Q3 2024, and study completion is expected by year-end.
  
  
• Enrollment into two Phase 2 trials ongoing. These tumor specific trials are investigating the potential of nab-sirolimus for difficult-to-treat mTOR-driven cancers: advanced or recurrent endometrioid-type endometrial cancer (EEC) in combination with letrozole, and neuroendocrine tumors (NETs). 
  
  
• At Aadi's request, Mirati/Bristol Myers Squibb and Aadi mutually agreed to terminate their collaboration and clinical supply agreement. Aadi is prioritizing investment in its Phase 2 trials in EEC and NETs. The Phase 1/2 trial with Mirati/Bristol Myers Squibb evaluated the combination of nab-sirolimus + adagrasib in non-small cell lung cancer with a KRAS^G12C mutation.

First Quarter 2024 Financial Results

• Cash, cash equivalents and short-term investments as of March 31, 2024, were $88.3 million as compared to $108.8 million as of December 31, 2023, which is expected to fund operations into Q4 2025 based on current plans.
  
  
• Total revenue for the quarter ended March 31, 2024, was $5.4 million, resulting from sales of FYARRO.
  
  
• Net loss for the three months ended March 31, 2024, was $18.3 million as compared to $15.2 million for the three months ended March 31, 2023.

Conference Call Information 

The Aadi management team is hosting a conference call and webcast today at 8:30 am EDT (5:30 am PDT) to provide a corporate update and discuss results for the first quarter 2024.

Participants may access a live webcast of the call on the "Investors & News" page of the Aadi Bioscience website at aadibio.com. To participate via telephone, please register in advance at this link. Upon registration, all telephone participants will receive a confirmation email detailing how to join the conference call, including the dial-in number along with a unique passcode and registrant ID that can be used to access the call. A replay of the conference call and webcast will be archived on the Company's website for at least 30 days.

About Aadi Bioscience 

Aadi is a commercial-stage precision oncology company focused on the development and commercialization of therapies for cancers with alterations in the mTOR pathway, a key regulator of cell growth and cancer progression. To unlock the full potential of mTOR inhibition, Aadi uniquely combines nanoparticle albumin-bound (nab) technology with the potent mTOR inhibitor, sirolimus. Aadi received FDA approval and commercializes FYARRO® for the treatment of adult patients with locally advanced unresectable or metastatic malignant perivascular epithelioid cell tumor (PEComa).

Aadi is exploring nab-sirolimus in PRECISION1, a Phase 2 tumor-agnostic registration-intended trial in mTOR inhibitor-naïve malignant solid tumors harboring TSC1 or TSC2 inactivating alterations. Aadi is also exploring nab-sirolimus in two tumor specific Phase 2 trials for difficult-to-treat mTOR-driven cancers: neuroendocrine tumors (NETs), and advanced or recurrent endometrioid-type endometrial cancer (EEC) in combination with letrozole. More information on the Company's development pipeline is available on the Aadi website at www.aadibio.com and connect with us on Twitter and LinkedIn.

Forward-Looking Statements

This press release contains certain forward-looking statements regarding the business of Aadi Bioscience that are not a description of historical facts within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on the Company's current beliefs and expectations and may include, but are not limited to, statements relating to: the Company's cash runway extending into the fourth quarter of 2025; the anticipated timing of commencement, enrollment, data releases and completion of the Company's clinical trials, including the expected PRECISION 1 two-thirds interim analysis in Q3 2024 and full results in early 2025 and Phase 2 trials in EEC and NETs later in 2024; the Company's anticipated growth and continued advancements, including in potential additional indications; expectations regarding the beneficial characteristics, safety, efficacy, therapeutic effects and the size of the potential targeted markets with respect to FYARRO, including in NETs and EEC; plans and potential for success relating to commercializing FYARRO; and the sufficiency of the Company's existing capital resources and the expected timeframe to fund the Company's future operating expenses and capital expenditure requirements. Actual results could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, uncertainties associated with the clinical development and regulatory approval of FYARRO in additional indications, including potential delays in the commencement, enrollment and completion of clinical trials for additional indications; risks associated with the ability to successfully commercialize FYARRO; failure to demonstrate the efficacy of FYARRO in clinical trials for additional indications; the risk that unforeseen adverse reactions or side effects may occur in the course of commercializing, developing and testing FYARRO; and risks related to the Company's estimates regarding future expenses, capital requirements and need for additional financing.

Additional risks and uncertainties that could cause actual outcomes and results to differ materially from those contemplated by the forward-looking statements are included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023, including under the caption "Item 1A. Risk Factors," and in Aadi's subsequent Quarterly Reports on Form 10-Q, and elsewhere in Aadi's reports and other documents that Aadi has filed, or will file, with the SEC from time to time and available at www.sec.gov.

All forward-looking statements in this press release are current only as of the date hereof and, except as required by applicable law, Aadi undertakes no obligation to revise or update any forward-looking statement, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise. All forward-looking statements are qualified in their entirety by this cautionary statement. This cautionary statement is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Contact:
IR@aadibio.com

 

AADI BIOSCIENCE, INC
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
		March 31,		December 31,
		2024		2023
Assets
Current assets:
Cash and cash equivalents		$               53,780		$               62,888
Short-term investments		34,491		45,957
Accounts receivable, net		4,933		5,488
Inventory		5,936		6,427
Prepaid expenses and other current assets		3,433		3,826
Total current assets		102,573		124,586
Property and equipment, net		5,686		4,802
Operating lease right-of-use assets		1,077		1,169
Other assets		1,737		1,866
Total assets		$             111,073		$             132,423
Liabilities and stockholders' equity
Current liabilities:
Accounts payable		$                 3,095		$                 5,898
Accrued liabilities		10,598		14,306
Operating lease liabilities, current portion		425		434
Due to licensor payable		5,757		5,757
Total current liabilities		19,875		26,395
Operating lease liabilities, net of current portion		738		833
Total liabilities		20,613		27,228
Stockholders' equity:
Common stock		2		2
Additional paid-in capital		377,718		374,129
Accumulated other comprehensive (loss) income		(8)		27
Accumulated deficit		(287,252)		(268,963)
Total stockholders' equity		90,460		105,195
Total liabilities and stockholders' equity		$             111,073		$             132,423

 

AADI BIOSCIENCE, INC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share data and earnings per share amounts)
(Unaudited)
				Three months ended
				March 31,
				2024		2023
	Revenue
	Product sales, net			$         5,353		$         5,867
	Total Revenue			5,353		5,867
	Operating expenses
	Selling, general and administrative			10,620		11,207
	Research and development			13,593		10,956
	Cost of goods sold			652		529
	Total operating expenses			24,865		22,692
	Loss from operations			(19,512)		(16,825)
	Other income (expense)
	Foreign exchange loss			(1)		-
	Interest income			1,282		1,660
	Interest expense			(58)		(58)
	Total other income (expense), net			1,223		1,602
	Net loss			$      (18,289)		$      (15,223)
	Net loss per share, basic and diluted
				$          (0.68)		$          (0.57)
	Weighted average number of common shares outstanding, basic and diluted			26,980,698		26,862,646

 

 

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SOURCE Aadi Bioscience

FAQ

<p>What were FYARRO sales in Q1 2024?</p>

FYARRO sales were $5.4 million in Q1 2024.

<p>What is the status of the PRECISION1 trial?</p>

The PRECISION1 trial is fully enrolled, with an interim analysis planned for Q3 2024.

<p>What trials are ongoing for nab-sirolimus?</p>

Phase 2 trials in EEC and NETs are ongoing for nab-sirolimus.

<p>How did distributor patterns impact sales in Q1 2024?</p>

Distributor patterns led to an 8.8% decrease in sales for Q1 2024.

<p>What was the net loss for Q1 2024?</p>

The net loss for Q1 2024 was $18.3 million.