AN2 Therapeutics Reports First Quarter 2024 Financial Results and Recent Business and Scientific Highlights
AN2 Therapeutics (Nasdaq: ANTX) released its Q1 2024 financial results and recent business updates. The company is focusing on the Phase 2/3 trial of epetraborole for treatment-refractory Mycobacterium avium Complex (TR-MAC). Phase 2 topline results are expected in August 2024. Phase 3 enrollment is paused due to lower than expected efficacy, not safety issues. R&D expenses rose to $14.7M from $12.0M YoY, while G&A expenses decreased to $3.6M from $4.1M. The net loss increased to $16.6M from $15.3M YoY. Cash reserves stood at $118.1M as of March 31, 2024.
- Expected Phase 2 topline results in August 2024 could provide critical efficacy data for epetraborole.
- Phase 3 trial continues for 97 patients enrolled before the voluntary pause.
- R&D expenses increased to $14.7M, indicating ongoing investment in clinical trials and research.
- G&A expenses decreased to $3.6M, showing improved administrative efficiency.
- Other income rose to $1.7M due to higher interest and investment income.
- Cash position is strong at $118.1M, providing financial flexibility.
- Phase 3 enrollment is paused due to potentially lower than expected efficacy in the Phase 2 study.
- Net loss increased to $16.6M from $15.3M YoY.
- Higher R&D expenses, despite the pause in Phase 3 enrollment, could affect future financial stability.
- The continuation of the Phase 3 trial depends on the unblinded Phase 2 data and FDA discussions.
Insights
AN2 Therapeutics' first quarter financial results reveal a mixed but generally stable financial position. The company reported higher R&D expenses of
The company's cash position remains strong, with
From a short-term perspective, the financials are stable, but the long-term outlook hinges on the success of the clinical trials and subsequent FDA discussions. The increase in R&D spending indicates a strong commitment to advancing their clinical pipeline, which is a positive sign for long-term growth potential.
The topline results from Phase 2 of the EBO-301 trial in August 2024 will be critical for AN2 Therapeutics. The trial focuses on epetraborole, a treatment for patients with treatment-refractory Mycobacterium avium Complex (TR-MAC), who have limited options. The decision to pause Phase 3 enrollment reflects a cautious approach, particularly given the lower-than-expected efficacy observed in blinded aggregate data.
The patient population in this trial is particularly challenging, with high rates of antibiotic resistance and severe lung disease. This context is important to understand the significance of any potential positive outcomes from the Phase 2 results. Should the data show efficacy, it would mark a significant breakthrough for a hard-to-treat condition, potentially paving the way for FDA approval and market entry. Conversely, negative results could delay progress and require a reassessment of the drug's viability.
The fact that the enrollment pause was not due to safety concerns is reassuring and may indicate that, while efficacy is a challenge, the safety profile of epetraborole is likely acceptable. This could still bode well for its eventual approval, provided efficacy data improves.
AN2 Therapeutics operates in a niche yet high-need market for rare infectious diseases. The upcoming Phase 2 data is pivotal, not just for the company but also for the broader market of antibiotic-resistant infections. Positive results could significantly boost AN2's market position, leading to higher market valuation and increased investor confidence.
The company's strategy to focus on such a specialized segment can be highly rewarding, considering the high unmet medical needs and fewer competitive pressures. However, it also comes with higher risks, especially in clinical outcomes. The current voluntary pause in Phase 3 is a double-edged sword. While it shows prudent management, it also indicates potential hurdles in demonstrating the drug's efficacy.
Investors should also watch the FDA's response closely. The agency's feedback post-Phase 2 results will be a important indicator of the drug's future path. Additionally, the strong cash position provides a cushion to navigate through these uncertainties, which is a positive factor.
Plan to report Phase 2 topline results in August 2024 from ongoing Phase 2/3 trial (EBO-301) in treatment-refractory Mycobacterium avium Complex (TR-MAC)
Phase 3 continues for 97 patients enrolled before the voluntary enrollment pause; lifting of the Phase 3 enrollment pause to be determined after review of unblinded Phase 2 data and discussions with the FDA
Cash, cash equivalents, and investments of
“The Phase 2 topline data, expected to be available in August, will include the first clinical efficacy data for epetraborole in patients with treatment-refractory MAC. The patients enrolled in EBO-301 are highly refractory with limited to no treatment options; and background regimens available provide little if any benefit,” said Eric Easom, Co-Founder, President and Chief Executive Officer. “We hope to see data demonstrating that epetraborole on top of background therapy will show benefit in these toughest to treat patients. The Phase 2 data package will be critical to informing the path forward for epetraborole in patients with treatment refractory MAC.”
First Quarter & Recent Business Updates:
Epetraborole Pivotal Phase 2/3 Clinical Study in TR-MAC Lung Disease
This double-blind, placebo-controlled trial is comparing epetraborole plus a background regimen versus placebo plus background regimen in patients with TR-MAC lung disease. In February 2024, the Company announced that it had voluntarily paused Phase 3 enrollment in the seamless Phase 2/3 clinical trial, pending further data review. While the Phase 3 part of the trial is paused for new enrollment, the Company is continuing to dose currently enrolled patients (n=97) under the existing protocol. The voluntary pause was instituted following an analysis of blinded aggregate data from the ongoing Phase 2 study, which showed potentially lower than expected efficacy. A blinded review of the aggregate baseline patient demographics points to a highly refractory patient population with high incidence of resistance to background regimens, prolonged nontuberculous mycobacteria (NTM) lung disease and high levels of cavitary disease; the study population also includes patients who are refractory to Arikayce, the only FDA-approved drug for refractory NTM caused by MAC. The decision to pause Phase 3 enrollment was not due to safety concerns.
The Company expects to announce topline data from the Phase 2 part of the trial in August 2024. Continuation of enrollment in the Phase 3 part of the study will be determined after reviewing the unblinded Phase 2 data and following discussions with FDA.
Selected First Quarter Financial Results
-
Research and Development (R&D) Expenses: R&D expenses for the first quarter of 2024 were
$14.7 million $12.0 million -
General and Administrative (G&A) Expenses: G&A expenses for the first quarter of 2024 were
$3.6 million $4.1 million -
Other Income, Net: Other income, net for the first quarter of 2024 was
$1.7 million $0.7 million -
Net loss: Net loss for the first quarter of 2024 was
$16.6 million $15.3 million -
Cash Position: The Company had cash, cash equivalents, and investments of
$118.1 million
About AN2 Therapeutics, Inc.
AN2 Therapeutics, Inc. is a clinical-stage biopharmaceutical company developing treatments for rare, chronic, and serious infectious diseases with high unmet needs. Our initial candidate is epetraborole, which we are studying as a once-daily, oral treatment with a novel mechanism of action for patients with nontuberculous mycobacteria (NTM) lung disease, a rare, chronic, and progressive infectious disease caused by bacteria known as mycobacteria, that leads to irreversible lung damage and can be fatal. For more information, please visit our website at www.an2therapeutics.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements expressed or implied in this press release include, but are not limited to, statements regarding: reporting topline data from Phase 2 of the EBO-301 trial; continued analysis and expectations regarding incoming data; continuation of the enrollment pause in Phase 3 of the EBO-301 trial; the occurrence and outcome of FDA discussions; potential of epetraborole; and other statements that are not historical fact. These statements are based on AN2’s current estimates, expectations, plans, objectives, and intentions, are not guarantees of future performance and inherently involve significant risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, but are not limited to, risks and uncertainties related to: the number of patients who remain enrolled in the Phase 2/3 trial; the ability of AN2 to resume enrollment in the Phase 2/3 trial, in the event the determination to resume enrollment is made; discussions with FDA; the ability of AN2 to effectively and timely make amendments to the Phase 2/3 pivotal trial design based on its analysis of the Phase 2 portion of the study and/or pursuant to additional FDA feedback; possible changes to AN2’s plans or priorities as it assesses study data; potential for protocol modifications, redesign, or study termination; timely enrollment of patients in AN2’s existing and future clinical trials; AN2’s ability to procure sufficient supply of its product candidate for its existing and future clinical trials; the potential for results from clinical trials to differ from preclinical, early clinical, preliminary, or expected results; significant adverse events, toxicities, or other undesirable side effects associated with AN2’s product candidate; the significant uncertainty associated with AN2’s product candidate ever receiving any regulatory approvals; AN2’s ability to obtain, maintain, or protect intellectual property rights related to its current and future product candidates; implementation of AN2’s strategic plans for its business and current and future product candidates; the sufficiency of AN2’s capital resources and need for additional capital to achieve its goals; global macroeconomic conditions and global conflicts; and other risks, including those described under the heading “Risk Factors” in AN2’s Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, and AN2’s other reports filed with the
AN2 THERAPEUTICS, INC. CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (in thousands, except share and per share data) (unaudited) |
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Three Months Ended
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2024 |
|
2023 |
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Operating expenses: |
|
|
|
|
|
||||
Research and development |
|
$ |
14,655 |
|
|
$ |
11,985 |
|
|
|
|
|
|
|
|
|
|
||
General and administrative |
|
|
3,641 |
|
|
|
4,054 |
|
|
Total operating expenses |
|
|
18,296 |
|
|
|
16,039 |
|
|
Loss from operations |
|
|
(18,296 |
) |
|
|
(16,039 |
) |
|
Other income, net |
|
|
1,679 |
|
|
|
716 |
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
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||
Net loss attributable to common stockholders |
|
$ |
(16,617 |
) |
|
$ |
(15,323 |
) |
|
Net loss per share attributable to common stockholders, basic and diluted |
|
$ |
(0.56 |
) |
|
$ |
(0.79 |
) |
|
Weighted-average number of shares used in computing net loss per share, basic and diluted |
|
|
29,763,278 |
|
|
|
19,385,646 |
|
|
Other comprehensive loss: |
|
|
|
|
|
||||
Unrealized (loss) gain on investments |
|
|
(222 |
) |
|
|
199 |
|
|
Comprehensive loss |
|
$ |
(16,839 |
) |
|
$ |
(15,124 |
) |
|
AN2 THERAPEUTICS, INC. CONDENSED BALANCE SHEETS (in thousands) |
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March 31,
|
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December 31,
|
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Assets |
|
|
|
|
|
|
|||
Cash and cash equivalents |
|
$ |
24,693 |
|
|
$ |
15,647 |
|
|
Short-term investments |
|
|
89,517 |
|
|
|
91,648 |
|
|
Prepaid expenses and other current assets |
|
|
2,103 |
|
|
|
3,212 |
|
|
Long-term investments |
|
|
3,904 |
|
|
|
27,194 |
|
|
Other assets, long-term |
|
|
1,043 |
|
|
|
1,043 |
|
|
Total assets |
|
$ |
121,260 |
|
|
$ |
138,744 |
|
|
|
|
|
|
|
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Liabilities and stockholders’ equity |
|
|
|
|
|
|
|||
Accounts payable |
|
$ |
2,433 |
|
|
$ |
2,676 |
|
|
Other current liabilities |
|
|
8,230 |
|
|
|
11,367 |
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
10,663 |
|
|
|
14,043 |
|
|
Stockholders’ equity |
|
|
110,597 |
|
|
|
124,701 |
|
|
Total liabilities and stockholders’ equity |
|
$ |
121,260 |
|
|
$ |
138,744 |
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240514775764/en/
Lucy O. Day
Chief Financial Officer
l.day@an2therapeutics.com
Anne Bowdidge
Investor Relations
abowdidge@an2therapeutics.com
Source: AN2 Therapeutics, Inc.
FAQ
When will AN2 Therapeutics report Phase 2 topline results for ANTX?
Why has AN2 Therapeutics paused Phase 3 enrollment for ANTX?
What are AN2 Therapeutics' Q1 2024 R&D expenses?
What is the cash position of AN2 Therapeutics as of March 31, 2024?
What was AN2 Therapeutics' net loss in Q1 2024?
What caused the increase in AN2 Therapeutics' other income in Q1 2024?
Were there any safety concerns related to the pause in ANTX Phase 3 enrollment?
