Codiak BioSciences Reports Third Quarter 2022 Financial Results and Operational Progress

Rhea-AI Summary

Codiak BioSciences (CDAK) reported its third quarter 2022 results, showing total revenues of $0.5 million, a decline from $1.2 million in Q3 2021. The net loss was $19.3 million, an improvement from $21.7 million year-over-year, driven by reduced lab and personnel expenses. The company continues its Phase 1 trial of exoASO™-STAT6 for advanced liver cancer with preliminary data expected in 1H 2023. Additionally, Codiak has partnered with CEPI for its pan beta coronavirus vaccine program, receiving up to $2.5 million in funding.

Positive

• Net loss decreased from $21.7 million in Q3 2021 to $19.3 million in Q3 2022.
• Research and development expenses reduced from $15.5 million in 2021 to $10.8 million in 2022.
• Partnership with CEPI secured $2.5 million funding for vaccine development.

Negative

• Total revenues decreased from $1.2 million in Q3 2021 to $0.5 million in Q3 2022.

– Patient enrollment continuing in Phase 1 clinical trial of exoASO™-STAT6 in patients with advanced hepatocellular carcinoma; preliminary data anticipated during 1H 2023 –

– Presented preclinical data showing exoVACC™ pan beta coronavirus vaccine, supported by CEPI, elicits broad protective immunity against variants of SARS-CoV-2 and other potentially human transmissible animal coronaviruses –

– Two preclinical abstracts accepted at SITC 2022 for exoASO-STAT6 and exoASO™-C/EBPβ –

CAMBRIDGE, Mass., Nov. 03, 2022 (GLOBE NEWSWIRE) -- Codiak BioSciences, Inc. (NASDAQ: CDAK), a clinical-stage biopharmaceutical company pioneering the development of exosome-based therapeutics as a new class of medicines, today reported third quarter 2022 financial results and recent operational progress.

“During the third quarter we prioritized our pipeline to focus on the clinical trial underway with exoASO™-STAT6 in patients with certain liver, gastric and colorectal cancers, and on advancing our engEx^® Platform and its potential in vaccine development and gene delivery,” said Douglas E. Williams, Ph.D., President and CEO of Codiak. “We are also grateful for the support of our existing shareholders and the new investors who participated in our recent financing, and we remain focused on advancing our priority programs and delivering data from the exoASO-STAT6 clinical trial anticipated in the first half of 2023.”

Third Quarter 2022 and Recent Highlights

• Continued patient enrollment in the Phase 1 clinical trial of systemically administered exoASO-STAT6 in patients with advanced hepatocellular carcinoma, liver metastases from primary gastric cancer and colorectal cancer.
• Presented preclinical data at Vaccines Summit 2022 in October demonstrating Codiak’s exoVACC™ pan beta coronavirus vaccine elicits broad protective immunity against known variants of SARS-CoV-2 and seven SARS-related coronaviruses that are currently in bats and may have a high potential to jump into humans.
• Partnered with CEPI (Coalition for Epidemic Preparedness Innovations) in early Q3 to continue the advancement of vaccine candidates from the Company’s pan beta coronavirus program. CEPI will provide seed funding of up to $2.5 million, which Codiak anticipates will fund the completion of preclinical development and identification of a clinical candidate.
• Announced financing, restructuring and re-prioritization to focus on delivering data from the ongoing clinical trial of exoASO-STAT6, advancing exoVACC and supporting the engEx-AAV™ discovery program, a novel strategy that aims to enable repeat dosing of gene delivery constructs.

Anticipated Milestones and Events

• Continue enrollment in Phase 1 trial for exoASO-STAT6, with initial data expected in 1H 2023.
• Present new preclinical data for macrophage targeting programs exoASO-STAT6 and exoASO™-C/EBPβ at the Society for Immunotherapy of Cancer (SITC) in November 2022.
• Further validate engEx-AAV gene delivery platform, with in vivo proof of concept data expected later this year, to be presented in 1H 2023.
• Advance exoVACC pan beta coronavirus program toward identification of a clinical candidate through partnership with CEPI.
• Pursue partnership opportunities for select programs, the engEx Platform or at the corporate level to continue advancing this new modality of exosome-based therapeutics.
  

Third Quarter 2022 Financial Results
Total revenues for the quarter ended September 30, 2022 were $0.5 million, compared to $1.2 million for the same period in 2021. Revenues for the third quarter 2022 reflect grant revenue from the Company’s agreement with CEPI.

Net loss for the quarter ended September 30, 2022 was $19.3 million, compared to a net loss of $21.7 million for the same period in 2021. The decrease in net loss for the quarter was driven primarily by decreases in lab expenses and personnel-related costs in connection with the Company’s agreement with Lonza.

Research and development expenses were $10.8 million for the quarter ended September 30, 2022, compared to $15.5 million for the same period in 2021. The decrease in research and development expenses was driven primarily by decreases in lab expenses and personnel-related costs in connection with the Company’s agreement with Lonza.

General and administrative expenses were $6.6 million for the quarter ended September 30, 2022, compared to $7.2 million for the same period in 2021. The decrease was due primarily to reduced personnel costs, partially offset by an increase in legal fees for intellectual property rights.  

As of September 30, 2022, Codiak had cash, cash equivalents, and marketable securities of approximately $51.8 million.

About Codiak BioSciences
Codiak is a clinical-stage biopharmaceutical company pioneering the development of exosome-based therapeutics, a new class of medicines with the potential to transform the treatment of a wide spectrum of diseases with high unmet medical need. By leveraging the biology of exosomes as natural intercellular transfer mechanisms, Codiak has developed its proprietary engEx^® Platform to expand upon the innate properties of exosomes to design, engineer and manufacture novel exosome therapeutic candidates. Codiak has utilized its engEx^® Platform to generate a deep pipeline of engineered exosomes aimed at treating a broad range of disease areas, spanning oncology, infectious disease and rare disease.

Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including, among other things, statements concerning the development and therapeutic potential of the Company’s portfolio, the clinical development of exoASO-STAT6, statements regarding the capabilities and potential of Codiak’s engEx Platform and engineered exosomes generally, and statements regarding the program reprioritization, plans to expand discussions related to potential strategic corporate and program-based partnerships, and the restructuring of operations. Any forward-looking statements in this press release are based on management’s current expectations of future events and are subject to a number of risks and uncertainties that could cause actual results to differ materially and adversely from those set forth in or implied by such forward-looking statements. In particular, the statements regarding the initiation and timing of clinical trials are dependent upon availability of sufficient cash resources, and statements regarding the restructuring are dependent on Codiak’s ability to successfully implement the restructuring and the impact of the restructuring on Codiak’s business, as to which the Company can make no assurances. For a discussion of these risks and uncertainties, and other important factors, any of which could cause our actual results to differ from those contained in the forward-looking statements, see the section entitled “Risk Factors” in Codiak’s Annual Report on Form 10-K for the year ended December 31, 2021, and in subsequent filings with the Securities and Exchange Commission (SEC), as well as discussions of potential risks, uncertainties and other important factors in Codiak’s subsequent filings with the SEC. All information in this press release is current as of the date of this report, and Codiak undertakes no duty to update this information unless required by law.

- financial tables follow -

CODIAK BIOSCIENCES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
(unaudited)

	SEPTEMBER 30,				DECEMBER 31,
	2022				2021
Assets
Current assets:
Cash and cash equivalents	$	51,762			$	76,938
Prepaid manufacturing services		6,727				7,315
Prepaid expenses and other current assets		2,744				5,918
Total current assets		61,233				90,171
Property and equipment, net of accumulated depreciation of $14,990 and $11,809		20,538				23,479
Restricted cash		4,170				4,170
Operating right-of-use assets		20,955				21,957
Prepaid manufacturing services, net of current portion		27,500				31,893
Total assets	$	134,396			$	171,670
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	1,956			$	1,838
Accrued expenses		8,126				9,703
Deferred revenue		1,363				12,963
Operating lease liabilities		3,011				2,661
Total current liabilities		14,456				27,165
Long-term liabilities:
Deferred revenue, net of current portion		17,317				30,686
Note payable, net of discount		25,693				25,430
Derivative liability - warrants		5,428				—
Operating lease liabilities, net of current portion		32,573				34,884
Total liabilities		95,467				118,165
Commitments and contingencies (Note 7)
Stockholders’ equity:
Common stock, $0.0001 par value; 150,000,000 shares authorized as of September 30, 2022 and December 31, 2021; 36,829,626 and 22,383,830 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively		4				2
Additional paid-in capital		398,253				378,750
Accumulated deficit		(359,328	)			(325,247	)
Total stockholders’ equity		38,929				53,505
Total liabilities and stockholders’ equity	$	134,396			$	171,670

CODIAK BIOSCIENCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(In thousands, except share and per share data)
(unaudited)

	THREE MONTHS ENDED SEPTEMBER 30,								NINE MONTHS ENDED SEPTEMBER 30,
	2022				2021				2022				2021
Revenue:
Collaboration revenue	$	28			$	1,157			$	25,877			$	15,238
Grant revenue	494					—			494					—
Total revenue		522				1,157				26,371				15,238
Operating expenses:
Research and development		10,847				15,467				37,893				47,436
General and administrative		6,563				7,186				20,634				20,711
Impairment of prepaid manufacturing services		4,508				—				4,508				—
Total operating expenses		21,918				22,653				63,035				68,147
Loss from operations		(21,396	)			(21,496	)			(36,664	)			(52,909	)
Other income (expense):
Interest expense		(758	)			(689	)			(2,007	)			(2,091	)
Interest income		119				4				157				18
Other income		35				479				1,711				1,163
Change in fair value of derivative liability - warrants		2,722				—				2,722				—
Total other income (expense), net		2,118				(206	)			2,583				(910	)
Net loss	$	(19,278	)		$	(21,702	)		$	(34,081	)		$	(53,819	)
Net loss per share attributable to common stockholders, basic and diluted	$	(0.77	)		$	(0.97	)		$	(1.46	)		$	(2.49	)
Weighted average common shares outstanding, basic and diluted		25,159,757				22,325,334				23,373,684				21,599,405

Investor Contact:
Christopher Taylor
VP, Investor Relations and Corporate Communications
T: 617-949-4220
E: investor@codiakbio.com

Media Contact:
Cory Tromblee
Scient PR
E: media@codiakbio.com 

FAQ

What were Codiak BioSciences' earnings results for Q3 2022?

Codiak reported total revenues of $0.5 million and a net loss of $19.3 million for Q3 2022.

When can we expect preliminary data from the exoASO-STAT6 trial?

Preliminary data from the exoASO-STAT6 trial is anticipated in the first half of 2023.

What funding did Codiak receive for its coronavirus vaccine program?

Codiak partnered with CEPI, receiving up to $2.5 million to advance its pan beta coronavirus vaccine.

How did Codiak BioSciences manage its expenses in Q3 2022?

Codiak reported reduced lab and personnel costs, contributing to a decrease in net loss and expenses.