Adaptimmune Reports Q4/Full Year 2023 Financial Results and Business Updates
- U.S. FDA accepted BLA for afami-cel for advanced synovial sarcoma with a priority review and a PDUFA date of August 4th, 2024.
- Company targeting launch of afami-cel upon FDA approval with sales projected up to $400 million.
- Cash runway into early 2026 with over $300 million in cash.
- Clinical pipeline update shows ADP-A2M4CD8 with promising response rates in solid tumors.
- None.
Insights
The FDA's priority review of afami-cel marks a significant milestone in the treatment of advanced synovial sarcoma, a disease with limited treatment options since 2013. Synovial sarcoma, a subset of soft tissue sarcomas, presents a high unmet medical need and the potential approval of afami-cel could offer a novel therapeutic option for patients. As an oncologist, the fact that this engineered T-cell therapy has reached a fully enrolled Cohort 2 in the pivotal SPEARHEAD-1 trial is promising. The therapy's mechanism, targeting the MAGE-A4 antigen, represents a shift towards precision medicine in oncology, potentially improving outcomes for patients who express this specific tumor antigen.
Furthermore, the projected peak sales of up to $400 million indicate a substantial market opportunity. This is particularly relevant given the rarity of the condition, which affects 5%-10% of approximately 13,000 annual soft tissue sarcoma cases in the U.S. The financial implications for Adaptimmune and the broader market for cell therapies in solid tumors could be significant, especially if this therapy sets a precedent for future treatments.
From a financial perspective, the acceptance of the Biologics License Application (BLA) by the FDA and the set Prescription Drug User Fee Act (PDUFA) date are critical for Adaptimmune's valuation and stock performance. The company's cash runway into early 2026, with over $300 million in liquidity, positions it well to manage the commercial launch of afami-cel, assuming approval. The financial guidance provided, including the R&D tax credits from the UK government, offers reassurance of fiscal stability in the near term.
It's worth noting that the increased revenue in 2023, primarily due to the termination of the Astellas collaboration, demonstrates Adaptimmune's ability to manage its partnerships and financial strategy effectively. The strategic combination with TCR2 Therapeutics and the transition of the lete-cel program back to Adaptimmune also suggest a refocusing of resources on promising assets. Investors should consider the implications of these strategic decisions on the company's long-term growth and profitability.
Analyzing the market dynamics, the potential launch of afami-cel in Q3 of 2024 could disrupt the current treatment paradigm for advanced synovial sarcoma. The company's strategy to initially focus on a limited number of Authorized Treatment Centers before expanding is a prudent approach to manage the complexities of cell therapy delivery. The success of this launch will be a bellwether for Adaptimmune's commercial capabilities and will likely influence investor confidence.
The companion diagnostic for MAGE-A4, which is under FDA review, is also a critical component of the commercial strategy, as it will identify eligible patients for the therapy. The integration of a companion diagnostic aligns with current trends towards personalized medicine and could enhance the therapy's adoption rate by ensuring the right patients are treated. This is a key consideration for stakeholders evaluating the potential reach and impact of afami-cel within the oncology market.
U.S. FDA accepted BLA for afami-cel for the treatment of advanced synovial sarcoma with priority review and a PDUFA date of August 4th, 2024
Confirmatory evidence for afami-cel full approval agreed with FDA; will use data from Cohort 2 of pivotal SPEARHEAD-1 trial, which is fully enrolled
Company is targeting launch of afami-cel upon receipt of FDA approval with commercial, manufacturing, and supply chain teams preparing for product delivery
Lete-cel program transitioned back to Adaptimmune and the Company is planning for US commercial launch in 2026
Sarcoma franchise of afami-cel and lete-cel leverages same development and commercial footprint with US peak year sales projected to be up to
Cash runway into early 2026; with greater than
Webcast to be held today, March 6, 2024, at 8:00 a.m. EST. (1:00 p.m. GMT)
Company will hold an investor day at its Navy Yard facility on April 18th – more details to follow
Philadelphia, Pennsylvania and Oxford, United Kindgom--(Newsfile Corp. - March 6, 2024) - Adaptimmune Therapeutics plc (NASDAQ: ADAP), a company redefining the treatment of solid tumor cancers with cell therapy, today reported financial results for the fourth quarter and full year ended December 31, 2023, and provided a business update on the progress made in establishing its sarcoma franchise.
Adrian Rawcliffe, Adaptimmune's Chief Executive Officer: "Adaptimmune is poised to bring afami-cel to market – which will be the first ever engineered T-cell therapy for a solid tumor. Afami-cel is the first product in our sarcoma franchise, which, if approved, along with lete-cel, has the potential to redefine the landscape for the treatment of advanced synovial sarcoma and MRCLS. This franchise, which is only the beginning of our commercial ambitions, is projected to deliver up to
Sarcoma Franchise
Afami-cel
- Adaptimmune is preparing to launch the first product in its sarcoma franchise, afami-cel, for the treatment of advanced synovial sarcoma pending review and approval by the FDA with a PDUFA date of August 4, 2024.
- Synovial sarcoma is a solid tumor cancer with high unmet medical need for which there has been no new effective treatment since 2013. Synovial sarcoma represents
5% -10% of the ~13,000 soft tissue sarcoma cases in the United States each year.a - If approved, afami-cel would be the first engineered T-cell therapy for a solid tumor to receive commercial approval in the U.S.
- Data from Cohort 2 of the pivotal trial SPEARHEAD-1 will serve as confirmatory evidence for full approval. This cohort is fully enrolled.
- Adaptimmune does not anticipate an advisory committee meeting, at this time, based on feedback received from FDA.
- Adaptimmune is preparing to launch afami-cel in Q3 of 2024 in the U.S. Initially, launch will be focused on 6-10 selected treatment centers ("Authorized Treatment Centers" or "ATCs") and will expand to up to ~30 additional ATCs. Field teams are being recruited and are engaging with ATCs.
- The marketing application for the companion diagnostic for MAGE-A4 is currently under FDA review and is expected to be approved contemporaneously with the BLA.
- Adaptimmune is a fully integrated cell therapy company and will deliver afami-cel's commercial supply from the Company's Navy Yard cell therapy manufacturing facility in Philadelphia. Adaptimmune's manufacturing and supply chain organization has delivered hundreds of clinical cell therapy batches to people enrolled in the Company's clinical trials, to date.
Lete-cel
- The second product in Adaptimmune's sarcoma franchise, lete-cel, is being investigated in the pivotal IGNYTE-ESO trial (NCT03967223), which at an interim analysis exhibited response in 18/45 of patients (ORR
40% ). The primary efficacy endpoint requires 16/60 patients have responses, so this trial has met its primary endpoint for efficacy. The full pivotal analyses are anticipated in late 2024. - Adaptimmune has received an upfront amount and will receive milestone-based payments totaling £30 million under the agreement with GSK.
- Lete-cel will enable Adaptimmune to expand its addressable synovial sarcoma patient population by targeting the NY-ESO cancer antigen, in addition to MAGE-A4 targeted by afami-cel, as well as treating Myxoid Round Cell Liposarcoma (MRCLS) patients.
- Once approved and marketed, afami-cel and lete-cel have the potential to treat more than 1,000 people with soft tissue sarcomas annually in the United Statesb
Clinical pipeline update
- As reported in ESMO 2023, ADP-A2M4CD8, Adaptimmune's next-generation engineered T-cell therapy exhibited
35% response rate in a broad range of solid tumors;50% response rate in 26 patients with ovarian, urothelial, and head & neck cancers. - ADP-A2M4CD8 is being investigated in the SURPASS-3 Phase 2 clinical trial (NCT05601752) for the treatment of platinum-resistant ovarian cancer. ADP-A2M4CD8 received FDA RMAT designation in 2022 for the treatment of patients with platinum resistant ovarian cancer. The SURPASS-3 trial is currently enrolling patients.
- Cohorts in the Phase 1 SURPASS trial are ongoing for people with head & neck and urothelial (bladder) cancers with ADP-A2M4CD8 in combination with standard of care checkpoint inhibitor therapy.
Preclinical pipeline update
- IND-enabling studies are underway for ADP-600 (PRAME) and ADP-520 (CD70) programs
- Genentech collaboration to research and develop allogeneic cell therapies continues as planned
- Wholly owned allogeneic pipeline advancing; process development in progress at Adaptimmune's allogeneic manufacturing facility in Milton Park, UK.
Corporate and other news
- Strategic combination with TCR2 Therapeutics completed in June of 2023
- Cintia Piccina appointed as Chief Commercial Officer
- The Company received R&D tax credits from the UK government in January 2024 of
$30.8m
Financial Results for the three months and year ended December 31, 2023
- Cash / liquidity position: As of December 31, 2023, Adaptimmune had cash and cash equivalents of
$143.9 million and Total Liquidity1 of$146.9 million , compared to$108.0 million and$204.6 million , respectively, as of December 31, 2022. - Revenue: Revenue for the three months and year ended December 31, 2023, was
$0.2 million and$60.3 million , respectively, compared to$11.0 million and$27.1 million for the same periods in 2022. Revenue has increased in 2023, compared to the same period in 2022 primarily due to the termination of the Astellas collaboration, resulting in the remaining deferred income for the collaboration being recognized as revenue in March 2023. - Research and development (R&D) expenses: R&D expenses for the three months and year ended December 31, 2023, were
$33.2 million and$126.5 million , respectively, compared to$23.1 million and$127.7 million for the same periods in 2022. R&D expenses in the three months ended December 31, 2023 increased due to a decrease in offsetting reimbursements receivable for research and development tax and expenditure credits. R&D expenses in the year ended December 31, 2023 decreased due to a decrease in the average number of employees engaged in research and development following the restructuring completed in the first quarter of 2023, decreases in subcontracted expenditures, a decrease in share-based compensation expenses and a decrease in in-process research and development costs, which was mostly offset by a decrease in offsetting reimbursements receivable for research and development tax and expenditure credits. - General and administrative (G&A) expenses: G&A expenses for the three months and year ended December 31, 2023, were
$16.9 million and$73.5 million , respectively, compared to$15.2 million and$63.4 million for the same periods in 2022. G&A expenses in the year ended December 31, 2023 increased due to restructuring and charges recognised in the first quarter of 2023, an increase in other corporate costs due to an increase in accounting, legal and professional fees incurred in relation to the TCR2 Therapeutics, Inc merger agreement and severance and other related costs for former TCR2 Therapeutics leadership, offset by a decrease in share-based compensation expenses. - Gain on bargain purchase: a
$22.0 million gain on bargain purchase was recognised in the year ended December 31, 2023, from the strategic combination with TCR2 Therapeutics, Inc. - Net loss: Net loss attributable to holders of the Company's ordinary shares for the three months and year ended December 31, 2023, was
$47.9 million and$113.9 million , respectively ($(0.04) and$(0.09) per ordinary share), compared to$29.3 million and$165.5 million , respectively ($(0.03) and$(0.17) per ordinary share), for the same periods in 2022.
Financial Guidance
The Company believes that its existing cash, cash equivalents and marketable securities, together with the additional payments under the Strategic Collaboration and License Agreement with Genentech and payments under the Termination and Transfer Agreement with GSK, will fund the Company's current operations into early 2026, as further detailed in the Company's Annual Report on Form 10-K for the year ended December 31, 2023, to be filed with the Securities and Exchange Commission following this earnings release.
Webcast Information
The Company will host a live webcast to provide additional details at 8:00 a.m. EST (1:00 p.m. GMT) today, March 6, 2024. A live webcast of the conference call and replay can be accessed at https://www.gowebcasting.com/13137. Call in information is as follows: 1-800-319-4610 (US or Canada) or +1-416-915-3239 (International and additional options available HERE).
About Adaptimmune
Adaptimmune is a clinical-stage biopharmaceutical company focused on designing, developing, and delivering cell therapies to transform the lives of people with cancer. The Company's unique engineered T-cell receptor (TCR) platform enables the engineering of T-cells to target and destroy cancers across multiple solid tumor types.
Forward-Looking Statements
This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (PSLRA). These forward-looking statements involve certain risks and uncertainties. Such risks and uncertainties could cause our actual results to differ materially from those indicated by such forward-looking statements, and include, without limitation: the success, cost and timing of our product development activities and clinical trials and our ability to successfully advance our TCR therapeutic candidates through the regulatory and commercialization processes. For a further description of the risks and uncertainties that could cause our actual results to differ materially from those expressed in these forward-looking statements, as well as risks relating to our business in general, we refer you to our Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2022, our Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other filings with the Securities and Exchange Commission. The forward-looking statements contained in this press release speak only as of the date the statements were made and we do not undertake any obligation to update such forward-looking statements to reflect subsequent events or circumstances.
Total Liquidity (a non-GAAP financial measure)
Total Liquidity (a non-GAAP financial measure) is the total of cash and cash equivalents and marketable securities (available-for-sale debt securities). Each of these components appears separately in the condensed consolidated balance sheet. The U.S. GAAP financial measure most directly comparable to Total Liquidity is cash and cash equivalents as reported in the condensed consolidated financial statements, which reconciles to Total Liquidity as follows (in thousands):
| December 31, | December 31, | |||||
| 2023 | 2022 | |||||
| Cash and cash equivalents | $ | 143,991 | $ | 108,033 | ||
| Marketable securities - available-for-sale debt securities | 2,947 | 96,572 | ||||
| Total Liquidity | $ | 146,938 | $ | 204,605 |
The Company believes that the presentation of Total Liquidity provides useful information to investors because management reviews Total Liquidity as part of its assessment of overall solvency and liquidity, financial flexibility, capital position and leverage.
Condensed Consolidated Statement of Operations
(unaudited, in thousands, except per share data)
| Three months ended | Year ended | |||||||||||
| December 31, | December 31, | |||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||
| Development revenue | 231 | 11,028 | 60,281 | 27,148 | ||||||||
| Revenue | $ | 231 | $ | 11,028 | $ | 60,281 | $ | 27,148 | ||||
| Research and development | (33,208 | ) | (23,052 | ) | (126,509 | ) | (127,726 | ) | ||||
| General and administrative | (16,879 | ) | (15,218 | ) | (73,513 | ) | (63,387 | ) | ||||
| Total operating expenses | (50,087 | ) | (38,270 | ) | (200,022 | ) | (191,113 | ) | ||||
| Operating loss | (49,856 | ) | (27,242 | ) | (139,741 | ) | (163,965 | ) | ||||
| Interest income | 1,596 | 523 | 5,964 | 1,542 | ||||||||
| Gain on bargain purchase | — | — | 22,049 | — | ||||||||
| Other income (expense), net | (313 | ) | (1,537 | ) | (807 | ) | (536 | ) | ||||
| Loss before income tax expense | (48,573 | ) | (28,256 | ) | (112,535 | ) | (162,959 | ) | ||||
| Income tax credit/(expense) | 656 | (994 | ) | (1,336 | ) | (2,497 | ) | |||||
| Net loss attributable to ordinary shareholders | $ | (47,917 | ) | $ | (29,250 | ) | $ | (113,871 | ) | $ | (165,456 | ) |
| Net loss per ordinary share | ||||||||||||
| Basic and diluted | $ | (0.04 | ) | $ | (0.03 | ) | $ | (0.09 | ) | $ | (0.17 | ) |
| Weighted average shares outstanding: | ||||||||||||
| Basic and diluted | 1,362,672,380 | 984,715,238 | 1,206,440,978 | 967,242,403 | ||||||||
Condensed Consolidated Balance Sheets
(unaudited, in thousands, except share data)
| December 31, | December 31, | |||||
| 2023 | 2022 | |||||
| Assets | ||||||
| Current assets | ||||||
| Cash and cash equivalents | $ | 143,991 | $ | 108,033 | ||
| Marketable securities - available-for-sale debt securities (amortized cost of | 2,947 | 96,572 | ||||
| Accounts receivable, net of allowance for expected credit losses of | 821 | 7,435 | ||||
| Other current assets and prepaid expenses | 59,793 | 43,330 | ||||
| Total current assets | 207,552 | 255,370 | ||||
| Restricted cash | 3,026 | 1,569 | ||||
| Operating lease right-of-use assets, net of accumulated amortization of | 20,762 | 18,019 | ||||
| Property, plant and equipment, net of accumulated depreciation of | 50,946 | 53,516 | ||||
| Intangible assets, net of accumulated amortization of | 330 | 442 | ||||
| Total assets | $ | 282,616 | $ | 328,916 | ||
| Liabilities and stockholders' equity | ||||||
| Current liabilities | ||||||
| Accounts payable | $ | 8,128 | $ | 4,753 | ||
| Operating lease liabilities, current | 5,384 | 2,728 | ||||
| Accrued expenses and other current liabilities | 30,303 | 31,215 | ||||
| Restructuring provision | — | 2,285 | ||||
| Deferred revenue, current | 28,973 | 23,520 | ||||
| Total current liabilities | 72,788 | 64,501 | ||||
| Operating lease liabilities, non-current | 19,851 | 20,349 | ||||
| Deferred revenue, non-current | 149,060 | 160,892 | ||||
| Other liabilities, non-current | 1,404 | 1,296 | ||||
| Total liabilities | 243,103 | 247,038 | ||||
| Stockholders' equity | ||||||
| Common stock - Ordinary shares par value £0.001, 1,702,760,280 authorized and 1,363,008,102 issued and outstanding (2022: 1,282,773,750 authorized and 987,109,890 issued and outstanding) | 1,865 | 1,399 | ||||
| Additional paid in capital | 1,064,569 | 990,656 | ||||
| Accumulated other comprehensive loss | (3,748 | ) | (875 | ) | ||
| Accumulated deficit | (1,023,173 | ) | (909,302 | ) | ||
| Total stockholders' equity | 39,513 | 81,878 | ||||
| Total liabilities and stockholders' equity | $ | 282,616 | $ | 328,916 | ||
Condensed Consolidated Cash Flow Statement
(unaudited, in thousands)
| Year ended | Year ended | |||||
| December 31, | December 31, | |||||
| 2023 | 2022 | |||||
| Cash flows from operating activities | ||||||
| Net loss | $ | (113,871) | $ | (165,456) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
| Depreciation | 9,453 | 5,266 | ||||
| Amortization | 387 | 809 | ||||
| Gain on bargain purchase | (22,049 | ) | — | |||
| Share-based compensation expense | 11,773 | 18,240 | ||||
| Unrealized foreign exchange losses/(gains) | 198 | (2,438 | ) | |||
| (Accretion)/amortization on available-for-sale debt securities | (1,986 | ) | 2,525 | |||
| Other | 167 | 816 | ||||
| Changes in operating assets and liabilities: | ||||||
| Increase in receivables and other operating assets | (1,291 | ) | (9,813 | ) | ||
| (Decrease)/increase in payables and other current liabilities | (9,087 | ) | 4,408 | |||
| (Increase)/decrease in deferred revenue | (14,574 | ) | 3,874 | |||
| Net cash used in operating activities | (140,880 | ) | (141,769 | ) | ||
| Cash flows from investing activities | ||||||
| Acquisition of property, plant and equipment | (4,681 | ) | (29,496 | ) | ||
| Acquisition of intangible assets | ||||||
FAQ
What is the PDUFA date for afami-cel for the treatment of advanced synovial sarcoma?
What is the sales projection for the sarcoma franchise including afami-cel and lete-cel?
What is the cash runway for Adaptimmune into early 2026?
What are the response rates of ADP-A2M4CD8 in various solid tumors?
