Homology Medicines Reports Third Quarter 2021 Financial Results and Recent Highlights

Rhea-AI Summary

Homology Medicines (Nasdaq: FIXX) announced it achieved three clinical programs in gene therapy and editing, with two trials initiated for phenylketonuria (PKU) and Hunter syndrome. The company reported a net loss of $(30.6) million or $(0.54) per share for Q3 2021, up from a loss of $(28.2) million in the prior year. Collaboration revenues rose to $1.7 million, driven by partnerships with Novartis and Pfizer. Operating expenses increased to $32.3 million, mainly due to R&D costs. Homology expects its cash reserves to last until Q1 2023, highlighting ongoing financial stability amidst clinical advancements.

Positive

• Achieved three clinical programs, moving two candidate therapies into trials.
• Collaboration revenues increased to $1.7 million, up from $0.6 million in 2020.
• Favorable clinical data presented for both HMI-103 and HMI-203 candidates.
• Maintained cash reserves of $187.6 million, projected to fund operations into Q1 2023.

Negative

• Net loss increased to $(30.6) million in Q3 2021 from $(28.2) million in Q3 2020.
• Total operating expenses rose to $32.3 million, up from $28.8 million year-over-year.
• R&D expenses climbed to $24.0 million, driven by costs associated with advancing clinical trials.

- Achieved Goal of Three Clinical Programs Across Gene Therapy and Gene Editing Technology Platform This Year -

- Start of First Gene Editing Trial Advances Mission to Develop Solutions for Both Adults and Pediatric Patients with PKU -

- Initiated juMPStart Trial of One-Time I.V. Gene Therapy Candidate for Adults with Hunter Syndrome -

BEDFORD, Mass., Nov. 15, 2021 (GLOBE NEWSWIRE) -- Homology Medicines, Inc. (Nasdaq: FIXX), a genetic medicines company, announced today financial results for the third quarter ended September 30, 2021, and highlighted recent accomplishments.

“We realized our goal to have three clinical programs underway this year by moving our gene editing candidate for PKU and gene therapy for Hunter syndrome into the clinic, both evaluating first-of-a-kind approaches for these diseases,” stated Arthur Tzianabos, Ph.D., President and CEO of Homology Medicines. “We have always planned to develop two solutions for people living with PKU, first with our ongoing pheNIX gene therapy trial in adults and now with our gene editing trial, which is focused initially on adults and then pediatric patients over time. In addition, our gene therapy program for patients with Hunter syndrome plans to evaluate a much needed one-time therapy designed to address both peripheral organ and cognitive manifestations of this disease with an I.V. infusion.”

Dr. Tzianabos added, “We continue to benefit from our internal commercial GMP manufacturing platform, as this fully integrated ‘plug and play’ capability has now delivered product for three successful INDs, including our first gene editing product candidate. Confidence in our AAVHSC technology and the team’s ability to develop genetic medicines builds as multiple programs have entered the clinic and is reflected in our recent commitment to expand our headquarters in support of continued growth and success.”

Third Quarter 2021 and Recent Accomplishments

• Announced the pheEDIT clinical trial, a Phase 1 dose-escalation study of one-time, in vivo product candidate HMI-103 that utilizes a nuclease-free gene editing approach for phenylketonuria (PKU) and leverages learnings from the Company’s ongoing pheNIX PKU trial with the same AAVHSC vector. Once positive safety and efficacy results are established in adults, Homology plans to enroll younger patients in clinical trials.
  • At the American Society of Human Genetics (ASHG) Meeting, data supporting HMI-103 gene editing precision were presented, including molecular methods that demonstrated on-target integration and no evidence of integration into any other genomic location in a humanized murine liver model.
  • HMI-103 received Fast Track designation by the U.S. Food and Drug Administration (FDA).
• Initiated the juMPStart clinical trial, a Phase 1 dose-escalation study of one-time, in vivo gene therapy candidate HMI-203, the first I.V. gene therapy designed to address both peripheral and central nervous system (CNS) effects, in adults with mucopolysaccharidosis type II (MPS II), or Hunter syndrome.
  • Data presented at ASHG showed adults with Hunter syndrome reported unmet medical needs despite the use of enzyme replacement therapy (ERT), particularly related to peripheral manifestations of the disease (e.g., range of motion and mobility, pain, etc.) and burden of chronic dosing. Preclinical data that supported the HMI-203 IND were also shared at scientific conferences, including systemic reduction of disease biomarkers in peripheral organs and the CNS, and prevention of skeletal deformaties.
• Provided an update on the ongoing pheNIX clinical trial, a Phase 2 dose expansion study evaluating HMI-102 gene therapy in adults with PKU. Specifically:
  • Both doses were generally well-tolerated and showed evidence of biological activity, including clinically meaningful reductions in phenylalanine (Phe) levels, increases in tyrosine (Tyr) and reductions in the Phe-to-Tyr ratio;         
  • Added new clinical trial sites for a total of 13 with more expected shortly, and expanded Medical Affairs, Clinical Development and Operations teams to support ongoing trials; and
  • Plans to provide a detailed data update in mid-2022 when more patients are expected to be enrolled in the trial.         
• In addition to studies supporting three clinical programs, Homology highlighted preclinical data from its GTx-mAb development program for paroxysmal nocturnal hemoglobinuria (PNH) at the European Society of Gene & Cell Therapy (ESGCT) Virtual Conference.
• Continued to support the rare disease patient community through educational efforts at national and regional patient advocacy-focused events.  
  

Third Quarter 2021 Financial Results

• Net loss for the quarter ended September 30, 2021 was $(30.6) million or $(0.54) per share, compared to a net loss of $(28.2) million or $(0.62) per share for the same period in 2020.
• Collaboration revenues for the quarter ended September 30, 2021 were $1.7 million, compared to $0.6 million for the quarter ended September 30, 2020. Collaboration revenues for the third quarter 2021 included the recognition of all remaining deferred revenue and final reimbursement of R&D expenses under the Company’s former collaboration with Novartis, in addition to revenue recognized under Homology’s stock purchase agreement with Pfizer.
• Total operating expenses for the quarter ended September 30, 2021 were $32.3 million, compared to $28.8 million for the quarter ended September 30, 2020, and consisted of research and development expenses and general and administrative expenses.
• Research and development expenses for the quarter ended September 30, 2021 were $24.0 million, compared to $20.4 million for the quarter ended September 30, 2020. Research and development expenses increased due to higher external development costs as HMI-103 and HMI-203 advanced into Phase 1 clinical trials during the quarter, as well as increased personnel costs to support ongoing development programs and new clinical programs, research initiatives, technology platform expansion and manufacturing capabilities. Partially offsetting these increases was a decrease in direct research expenses for HMI-102 due to the completion of manufacturing of drug product in the prior year for the Phase 1/2 pheNIX clinical trial. Additionally, the continued optimization of Homology’s ‘plug and play’ manufacturing process and platform has created efficiencies across all of programs that directly reduced spend for clinical trial and other materials and limited reliance on outside contract manufacturing organizations.
• General and administrative expenses for each of the quarters ended September 30, 2021 and 2020 were $8.4 million.
• As of September 30, 2021, Homology had approximately $187.6 million in cash, cash equivalents and short-term investments. Based on current projections, Homology continues to expect cash resources to fund operations into the first quarter of 2023.

Upcoming Event

• Stifel 2021 Virtual Healthcare Conference: November 17 at 9:20 a.m. ET
  

About Homology Medicines, Inc.
Homology Medicines, Inc. is a clinical-stage genetic medicines company dedicated to transforming the lives of patients suffering from rare diseases by addressing the underlying cause of the disease. The Company’s clinical programs include HMI-102, an investigational gene therapy for adults with phenylketonuria (PKU); HMI-103, a gene editing candidate for PKU; and HMI-203, an investigational gene therapy for Hunter syndrome. Additional programs focus on metachromatic leukodystrophy (MLD), paroxysmal nocturnal hemoglobinuria (PNH) and other diseases. Homology’s proprietary platform is designed to utilize its family of 15 human hematopoietic stem cell-derived adeno-associated virus vectors (AAVHSCs) to precisely and efficiently deliver genetic medicines in vivo through a gene therapy or nuclease-free gene editing modality, as well as to deliver one-time gene therapy to produce antibodies throughout the body through the GTx-mAb platform. Homology has a management team with a successful track record of discovering, developing and commercializing therapeutics with a focus on rare diseases. Homology believes its initial clinical data and compelling preclinical data, scientific and product development expertise, internal manufacturing capabilities and broad intellectual property position the Company as a leader in genetic medicines. For more information, visit www.homologymedicines.com.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding our expectations surrounding the potential, safety, efficacy, and regulatory and clinical progress of our product candidates; our plans to name a development candidate in a new therapeutic area and potential thereof; plans and timing for the release of additional preclinical and clinical data; our beliefs regarding our manufacturing capabilities; our position as a leader in the development of genetic medicines; the sufficiency of our cash and cash equivalents to fund our operations; and our participation in upcoming presentations and conferences. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the following: the impact of the COVID-19 pandemic on our business and operations, including our preclinical studies and clinical trials, and on general economic conditions; we have and expect to continue to incur significant losses; our need for additional funding, which may not be available; failure to identify additional product candidates and develop or commercialize marketable products; the early stage of our development efforts; potential unforeseen events during clinical trials could cause delays or other adverse consequences; risks relating to the capabilities of our manufacturing facility; risks relating to the regulatory approval process; our product candidates may cause serious adverse side effects; inability to maintain our collaborations, or the failure of these collaborations; our reliance on third parties; failure to obtain U.S. or international marketing approval; ongoing regulatory obligations; effects of significant competition; unfavorable pricing regulations, third-party reimbursement practices or healthcare reform initiatives; product liability lawsuits; failure to attract, retain and motivate qualified personnel; the possibility of system failures or security breaches; risks relating to intellectual property and significant costs as a result of operating as a public company. These and other important factors discussed under the caption “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 and our other filings with the SEC could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change.

- Financial Tables Follow -

HOMOLOGY MEDICINES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(Unaudited)
		As of
		September 30, 2021			December 31, 2020
Cash, cash equivalents and short-term investments		$	187,551		$	217,431
Property and equipment, net			32,697			37,002
Right-of-use assets			5,028			5,897
Other assets			5,540			3,407
Total assets		$	230,816		$	263,737
Accounts payable, accrued expenses and other liabilities		$	13,538		$	14,525
Operating lease liabilities			13,541			15,442
Deferred revenue			5,166			37,775
Stockholders' equity			198,571			195,995
Total liabilities and stockholders' equity		$	230,816		$	263,737

HOMOLOGY MEDICINES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(Unaudited)
		Three months ended September 30,								Nine months ended September 30,
			2021				2020				2021				2020
Collaboration revenue		$	1,677			$	567			$	33,169			$	1,722
Operating expenses:
Research and development			23,987				20,417				69,439				77,197
General and administrative			8,351				8,423				26,054				24,986
Total operating expenses			32,338				28,840				95,493				102,183
Loss from operations			(30,661	)			(28,273	)			(62,324	)			(100,461	)
Other income:
Interest income			53				41				143				1,558
Total other income			53				41				143				1,558
Net loss		$	(30,608	)		$	(28,232	)		$	(62,181	)		$	(98,903	)
Net loss per share-basic and diluted		$	(0.54	)		$	(0.62	)		$	(1.14	)		$	(2.19	)
Weighted-average common shares outstanding-basic and diluted			57,106,639				45,227,231				54,704,410				45,196,459

 

Company Contacts
Theresa McNeely
Chief Communications Officer
and Patient Advocate
tmcneely@homologymedicines.com
781-301-7277

Media Contact:
Cara Mayfield
Vice President, Patient Advocacy
and Corporate Communications
cmayfield@homologymedicines.com
781-691-3510

FAQ

What were Homology Medicines' earnings results for Q3 2021?

Homology Medicines reported a net loss of $(30.6) million or $(0.54) per share for Q3 2021.

How did collaboration revenues change for FIXX in Q3 2021?

Collaboration revenues increased to $1.7 million in Q3 2021, compared to $0.6 million in the same quarter of 2020.

What clinical trials did Homology Medicines initiate recently?

Homology initiated two trials: the pheEDIT trial for PKU and the juMPStart trial for Hunter syndrome.

What is the cash outlook for Homology Medicines?

As of September 30, 2021, Homology had approximately $187.6 million in cash, expected to fund operations into Q1 2023.