Equillium Reports on Fourth Quarter and Full Year 2023 Financial Results and Corporate and Clinical Highlights
- Strong cash position of $40.9 million at the end of 2023 for sustained operations.
- Completion of Phase 2 clinical study enrollment for EQ101 in alopecia areata with upcoming topline data.
- Positive results from Phase 1b EQUALISE study of itolizumab in lupus nephritis patients presented at medical meetings.
- Anticipated Ono Pharmaceutical's option exercise decision for itolizumab in 2H 2024.
- Successful financial results for Q4 2023 and full year, showcasing revenue growth and controlled expenses.
- Revenue decline from $15.8 million in Q4 2022 to $9.2 million in Q4 2023.
- Net loss reported for Q4 2023 compared to net income in Q4 2022.
- Decrease in cash, cash equivalents, and short-term investments from $71.0 million in 2022 to $40.9 million in 2023.
Insights
The financial results and clinical updates from Equillium, Inc. are a significant indicator of the company's trajectory and potential impact on the biotech sector. The reported cash balance of $40.9 million signals a stable financial position, providing a runway into the second half of 2025. This timeline is important for investors as it offers a clear window for the company's operational sustainability without the immediate need for additional capital raising, which can dilute share value.
The completion of the Phase 2 clinical study enrollment for EQ101, targeting alopecia areata, is noteworthy. Current treatments for this condition have considerable side effects and a safer alternative could capture a substantial market share. The anticipation of topline data in Q2 2024 means that investors should be attentive to this potential catalyst for stock volatility. Furthermore, the possibility of a $331 million payment from Ono Pharmaceutical upon exercising their option for itolizumab rights could significantly bolster Equillium's financials and extend its cash runway, which is a positive sign for shareholder value.
The positive data from the Phase 1b EQUALISE study of itolizumab in lupus nephritis presented at ASN and ACR meetings is a promising development. The safety profile and response rates in highly proteinuric patients could indicate a strong therapeutic potential for itolizumab. As lupus nephritis is a serious condition with limited treatment options, a new successful therapy could disrupt the market and provide significant revenue for Equillium.
The advancement of EQ302 as a bi-specific inhibitor targeting IL-15 and IL-21 with improved potency and oral delivery is another strategic R&D move. If this inhibitor demonstrates efficacy in gastrointestinal indications, it could address a range of conditions with high unmet medical needs, such as celiac disease and inflammatory bowel disease, which are areas of intense interest in the pharmaceutical industry. The potential market for effective treatments in these areas is substantial and a successful development could have a significant impact on the company's growth.
Equillium's reported revenue for the fourth quarter of 2023 at $9.2 million, compared with $15.8 million for the same period in 2022, reflects a substantial change year-over-year. However, the full-year revenue growth from $15.8 million in 2022 to $36.1 million in 2023 is a strong positive indicator, driven by the development funding and amortization from the asset purchase agreement with Ono. This growth in revenue is a positive sign for investors, suggesting that the company's partnership strategy is paying off.
The decrease in net loss for the full year of 2023 to $13.3 million from $62.4 million in 2022 is significant. This reduction is attributed to lower operating expenses and greater revenue related to the Ono partnership. Such financial health improvements are essential for investor confidence, particularly in the biotech industry where profitability is often long-term. The financial prudence demonstrated by the reduction in general and administrative expenses also reflects positively on company management.
Completed enrollment of Phase 2 clinical study of EQ101 in alopecia areata: topline data expected in Q2 2024
Presented positive data from Phase 1b EQUALISE study of itolizumab in lupus nephritis patients at American Society of Nephrology (ASN) & American College of Rheumatology (ACR) meetings
Ono Pharmaceutical option exercise decision for itolizumab expected in 2H 2024
“The past year we have been focused on clinical execution that has set up the potential milestones we have in front of us in 2024,” said Bruce Steel, chief executive officer at Equillium. “The Phase 1b EQUALISE study of itolizumab in patients with lupus nephritis is now complete. We presented positive data from this study at the annual meetings of both ASN and ACR in the fourth quarter last year and we expect to deliver the topline data to our partner Ono in the coming weeks. We expect to announce the results of the interim review by the data monitoring committee of our Phase 3 EQUATOR study of itolizumab in patients with acute graft-versus-host disease in the third quarter, which would represent the final data deliverable to trigger Ono’s option exercise period, which will expire three months following such deliverables. If Ono exercises their option to acquire our rights to itolizumab we would receive an exercise payment of approximately
“Our lead multi-cytokine inhibitor, EQ101, a first in class, tri-specific inhibitor targeting IL-2, IL-9 and IL-15, has completed enrollment in a Phase 2 study for the treatment of moderate to severe alopecia areata. There remains a large unmet medical need for safer alternatives to JAK inhibitors, which carry black-box warnings and are today the only approved class of drugs to treat alopecia areata patients. This is the first study in which EQ101 has been tested in alopecia areata patients, where we are looking for signs of clinical activity above historically low observed placebo responses. We’re pleased to have completed enrollment of this study and look forward to announcing topline data in the second quarter this year.”
“In addition to clinical execution, we have also focused efforts on advancing the rest of our novel multi-cytokine inhibitor programs,” said Steve Connelly, chief scientific officer at Equillium. “EQ302, our first-in-class, bi-specific inhibitor of IL-15 and IL-21, is a second-generation peptide with improved potency that is orally deliverable and stable in the gut. We believe this represents a compelling product profile well positioned to target gastrointestinal indications including celiac disease, inflammatory bowel disease, and eosinophilic esophagitis. We look forward to advancing this program towards the clinic.”
Q4 2023 Highlights:
- Presented positive data from the Phase 1b EQUALISE study of itolizumab in lupus nephritis patients at the annual meetings of both ASN and ACR. The presentations highlighted a well-tolerated safety profile and data that demonstrated high complete and partial response rates with rapid and deep reductions in urine protein creatinine ratios in highly proteinuric patients when itolizumab was added to mycophenolate mofetil and corticosteroids.
- Hosted an Analyst & Investor Day featuring Arash Mostaghimi, MD, MPA, MPH, associate professor of dermatology at Harvard Medical School, that highlighted Equillium’s pipeline, the multi-cytokine platform and clinical-stage multi-cytokine inhibitors, with a focus on EQ101, currently in a Phase 2 clinical study for moderate to severe alopecia areata.
- Announced a presentation at the 18th Annual Peptide Therapeutics Symposium highlighting EQ302, a first-in-class, second generation, orally deliverable multi-cytokine inhibitor targeting IL-15 and IL-21. The presentation outlined the origins of EQ302 from its parent peptide and data illustrating that adding hydrocarbon staples to the peptide conferred increased stability in the gastrointestinal tract while retaining its cytokine inhibitory properties.
Anticipated Upcoming Milestones:
- EQ101: Phase 2 clinical study in subjects with moderate to severe alopecia areata – topline data anticipated in Q2 2024
- Itolizumab: EQUALISE lupus nephritis topline data to Ono anticipated in the coming weeks; EQUATOR acute graft-versus-host disease interim review anticipated in Q3 2024
- Ono option exercise decision anticipated in 2H 2024
Fourth Quarter and Full Year 2023 Financial Results
Revenue for the fourth quarter of 2023 was
Research and development (R&D) expenses for the fourth quarter of 2023 were
General and administrative (G&A) expenses for the fourth quarter of 2023 were
Net loss for the fourth quarter of 2023 was
Cash, cash equivalents and short-term investments totaled
About Multi-Cytokine Platform and Multi-Cytokine Inhibitors EQ101 & EQ302
Our proprietary multi-cytokine platform generates rationally designed composite peptides that selectively block key cytokines at the shared receptor level targeting pathogenic cytokine redundancies and synergies while preserving non-pathogenic signaling. This approach is expected to avoid the broad immuno-suppression and off-target safety liabilities that may be associated with other therapeutic classes, such as Janus kinase inhibitors. Many immune-mediated diseases are driven by the same combination of dysregulated cytokines, and we believe identifying the key cytokines for these diseases will allow us to target and develop customized treatment strategies for multiple autoimmune and inflammatory diseases.
Current platform assets include EQ101, a clinical stage, first-in-class, selective, tri-specific inhibitor of IL-2, IL-9, and IL-15 for intravenous and subcutaneous delivery and EQ302, a preclinical stage, first-in-class, selective, bi-specific inhibitor of IL-15 and IL-21 for oral delivery.
About Itolizumab
Itolizumab is a clinical-stage, first-in-class anti-CD6 monoclonal antibody that selectively targets the CD6-ALCAM signaling pathway to downregulate pathogenic T effector cells while preserving T regulatory cells critical for maintaining a balanced immune response. This pathway plays a central role in modulating the activity and trafficking of T cells that drive a number of immuno-inflammatory diseases.
About Equillium
Equillium is a clinical-stage biotechnology company leveraging a deep understanding of immunobiology to develop novel therapeutics to treat severe autoimmune and inflammatory disorders with high unmet medical need. The company’s pipeline consists of the following novel first-in-class immunomodulatory assets and product platform targeting immuno-inflammatory pathways. EQ101: a selective tri-specific cytokine inhibitor targeting IL-2, IL-9, and IL-15; currently under evaluation in a Phase 2 proof-of-concept clinical study of patients with alopecia areata being conducted in
For more information, visit www.equilliumbio.com.
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1 Option exercise payment is denominated in
Forward Looking Statements
Statements contained in this press release regarding matters that are not historical facts are “forward-looking Statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “anticipate”, “believe”, “could”, “continue”, “expect”, “estimate”, “may”, “plan”, “outlook”, “future” and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These statements include, but are not limited to, statements regarding Equillium’s plans for developing EQ101, EQ302 and itolizumab and the expected timeline for results from clinical studies, anticipated upcoming milestones, the timing for triggering Ono’s option period and for receiving Ono’s option decision, the potential impacts of Ono’s option exercise decision, the timing for an IND submission for EQ302, the fluctuation of the foreign exchange rate, Equillium’s cash runway, and the potential benefits of Equillium’s product candidates. Because such statements are subject to risks and uncertainties, many of which are outside of Equillium’s control, actual results may differ materially from those expressed or implied by such forward-looking statements. Risks that contribute to the uncertain nature of the forward-looking statements include: Equillium’s ability to execute its plans and strategies; risks related to performing clinical and pre-clinical studies; whether the results from clinical and pre-clinical studies will validate and support the safety and efficacy of Equillium’s product candidates; changes in the competitive landscape; risks related to Ono’s financial condition and decision to exercise its option, if ever to purchase itolizumab or terminate the asset purchase agreement; uncertainties related to Equillium’s capital requirements; and having to use cash in ways or on timing other than expected and the impact of market volatility on cash reserves. These and other risks and uncertainties are described more fully under the caption "Risk Factors" and elsewhere in Equillium's filings and reports, which may be accessed for free by visiting the Securities and Exchange Commission’s website and on Equillium’s website under the heading “Investors.” Investors should take such risks into account and should not rely on forward-looking statements when making investment decisions. All forward-looking statements contained in this press release speak only as of the date on which they were made. Equillium undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.
Equillium, Inc. |
||||||
Condensed Consolidated Balance Sheets |
||||||
(In thousands) |
||||||
(unaudited) |
||||||
|
|
December 31, |
||||
|
|
2023 |
|
2022 |
||
Assets |
||||||
Cash, cash equivalents and short-term investments |
$ |
40,866 |
$ |
71,023 |
||
Accounts receivable |
|
3,735 |
|
2,838 |
||
Prepaid expenses and other assets |
|
5,133 |
|
3,369 |
||
Operating lease right-of-use assets |
|
796 |
|
1,191 |
||
Total assets |
$ |
50,530 |
$ |
78,421 |
||
Current liabilities |
||||||
Accounts payable and other current liabilities |
$ |
11,844 |
$ |
17,338 |
||
Current portion of deferred revenue |
|
15,729 |
|
14,700 |
||
Total current liabilities |
|
27,573 |
|
32,038 |
||
Long-term deferred revenue |
|
- |
|
10,378 |
||
Other long-term liabilities |
|
384 |
|
4,063 |
||
Total liabilities |
|
27,957 |
|
46,479 |
||
Total stockholders' equity |
|
22,573 |
|
31,942 |
||
Total liabilities and stockholders' equity |
$ |
50,530 |
$ |
78,421 |
||
Equillium, Inc. |
||||||||||||||||
Condensed Consolidated Statements of Operations |
||||||||||||||||
(In thousands, except share and per share data) |
||||||||||||||||
(unaudited) |
||||||||||||||||
|
Three Months Ended
|
Year Ended
|
||||||||||||||
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
||||
Revenue |
$ |
9,211 |
|
$ |
15,759 |
$ |
36,084 |
|
$ |
15,759 |
|
|||||
Operating expenses: |
||||||||||||||||
Research and development |
|
9,183 |
|
|
8,525 |
|
|
37,039 |
|
|
37,547 |
|
||||
Acquired in-process research and development |
|
- |
|
|
- |
|
|
- |
|
|
23,049 |
|
||||
General and administrative |
|
3,228 |
|
|
5,192 |
|
|
13,567 |
|
|
17,239 |
|
||||
Total operating expenses |
|
12,411 |
|
|
13,717 |
|
|
50,606 |
|
|
77,835 |
|
||||
(Loss) income from operations |
|
(3,200 |
) |
|
2,042 |
|
|
(14,522 |
) |
|
(62,076 |
) |
||||
Other income (expense), net |
|
874 |
|
|
731 |
|
|
1,767 |
|
|
(352 |
) |
||||
Net (loss) income before income tax expense |
|
(2,326 |
) |
|
2,773 |
|
|
(12,755 |
) |
|
(62,428 |
) |
||||
Income tax expense |
|
16 |
|
|
- |
|
|
580 |
|
|
- |
|
||||
Net (loss) income |
$ |
(2,342 |
) |
$ |
2,773 |
|
$ |
(13,335 |
) |
$ |
(62,428 |
) |
||||
Net (loss) income per common share, basic and diluted |
$ |
(0.07 |
) |
$ |
0.08 |
|
$ |
(0.38 |
) |
$ |
(1.85 |
) |
||||
Weighted-average number of common shares outstanding, basic and diluted |
|
35,153,124 |
|
|
34,366,926 |
|
|
34,726,384 |
|
|
33,727,945 |
|
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View source version on businesswire.com: https://www.businesswire.com/news/home/20240325649617/en/
Investor Contact
Michael Moore
Vice President, Investor Relations & Corporate Communications
619-302-4431
ir@equilliumbio.com
Source: Equillium, Inc.
FAQ
What is Equillium's cash balance at the end of 2023?
When is the topline data for the Phase 2 clinical study of EQ101 in alopecia areata expected?
What positive data was presented from the Phase 1b EQUALISE study of itolizumab?
When is Ono Pharmaceutical's option exercise decision for itolizumab expected?
What was the revenue for the fourth quarter of 2023?
What was Equillium's net loss for the full year of 2023?
How much cash, cash equivalents, and short-term investments did Equillium have as of December 31, 2023?
