Jounce Therapeutics Reports Third Quarter 2020 Financial Results

Rhea-AI Summary

Jounce Therapeutics (NASDAQ: JNCE) announced its third-quarter 2020 results, reporting a net loss of $24.9 million, or $0.73 per share. The company initiated the Phase 2 SELECT trial for vopratelimab and established a license agreement with Gilead for JTX-1811, receiving $120 million in cash. Jounce's cash position decreased to $105.3 million by September 30, 2020, primarily due to operating expenses, with a projected annual cash burn of $80 million to $95 million. Upcoming milestones include starting a Phase 1 trial for JTX-8064 by year-end 2020.

Positive

• Established exclusive license agreement with Gilead for JTX-1811, bringing in $120 million.
• Initiated Phase 2 SELECT trial for vopratelimab to target NSCLC patients.
• Expected to start Phase 1 trial for JTX-8064 by year-end 2020.

Negative

• Net loss of $24.9 million for Q3 2020, significantly down from net income of $98.9 million in Q3 2019.
• No license and collaboration revenue recognized in Q3 2020, compared to $50 million in Q3 2019.

-On track to begin enrollment in the Phase 1 trial for JTX-8064 by year-end 2020-

-Established exclusive license agreement with Gilead for JTX-1811-

-Initiated the Phase 2 SELECT biomarker selection trial of vopratelimab in combination with JTX-4014-

-Company to host conference call and webcast today at 8:00 AM ET-

CAMBRIDGE, Mass., Nov. 06, 2020 (GLOBE NEWSWIRE) -- Jounce Therapeutics, Inc. (NASDAQ: JNCE), a clinical-stage company focused on the discovery and development of novel cancer immunotherapies and predictive biomarkers, today reported financial results for the third quarter ended September 30, 2020, and provided a corporate update.

“Jounce made continued progress this quarter and I am very proud of the work our team has done to initiate our next clinical study, SELECT, and move our lead macrophage program, JTX-8064, an inhibitor of the LILRB2 (or ILT4) receptor, towards the clinic. Notably, we also entered into a license agreement with Gilead for our anti-CCR8 program JTX-1811,” said Richard Murray, Ph.D., chief executive officer and president of Jounce Therapeutics. “Our broad pipeline of clinical and preclinical programs targets both PD-1 naïve and experienced patient populations, allowing for the potential to extend clinical benefit to individuals who have not previously benefited from IO therapy. We look forward to leveraging our expertise and IO pipeline to further our goal of bringing the right immunotherapies to the right patients.”

Pipeline Update:
Clinical Programs: Vopratelimab and JTX-4014

• Initiated Phase 2 SELECT trial of vopratelimab: Jounce initiated the randomized Phase 2 SELECT trial to evaluate vopratelimab in combination with JTX-4014, a PD-1 inhibitor, versus JTX-4014 alone in immunotherapy naïve TIS^vopra biomarker-selected, second line NSCLC patients. Jounce expects to enroll approximately 75 patients outside the U.S. and expects to report clinical data in late 2021.
   
• Reported interim analysis data from Phase 2 EMERGE trial and announced no expansion of enrollment: The interim analysis of the EMERGE Phase 2 clinical trial of the ipilimumab and vopratelimab combination did not meet its pre-specified criteria for expansion of the study. Overall survival and biomarkers will continue to be evaluated.

Preclinical Development Programs: JTX-8064 and JTX-1811

• On track to initiate Phase 1 clinical trial of JTX-8064 by year-end 2020: Enrollment in the Phase 1 dose escalation trial of JTX-8064, a highly-selective, potential first in class antibody that targets the Leukocyte Immunoglobulin Like Receptor B2 (LILRB2 or ILT4) on macrophages, is expected to begin by year-end 2020.
   
• New JTX-8064 preclinical data to be presented at the Society for Immunotherapy of Cancer’s (SITC) 2020 Annual Meeting:  On November 11, 2020 Jounce will present additional preclinical data for JTX-8064 at the SITC Annual Meeting. The poster will include data informing the indication selection and biomarker strategies for JTX-8064 to maximize potential therapeutic benefit for patients with solid tumor malignancies.
   
• Established exclusive license agreement with Gilead for the development and commercialization of JTX-1811: In September 2020, Jounce announced an exclusive license agreement providing Gilead with the worldwide rights to JTX-1811, Jounce’s highly selective, potential first-in-class antibody designed to selectively deplete immunosuppressive tumor-infiltrating T regulatory cells. The transaction closed in October 2020 and Jounce received $120 million in cash, including a $35 million equity investment. Under the terms of the agreement, Jounce continues to progress JTX-1811 to IND clearance and is on track for an IND filing in the first half 2021.

Third Quarter 2020 Financial Results:

• Cash position: As of September 30, 2020, cash, cash equivalents and investments were $105.3 million, compared to $170.4 million as of December 31, 2019. The decrease in cash, cash equivalents and investments was primarily due to operating expenses incurred during the period. Not included in the September 30, 2020 cash balance is the $120.0 million we received upon the closing of the Gilead agreements in October 2020.
  
  
• License and collaboration revenue: Jounce did not recognize any revenue in the third quarter of 2020. License and collaboration revenue recognized during the third quarter of 2019 was comprised of $50.0 million of cash revenue related to Jounce’s license agreement with Celgene and $69.4 million of non-cash revenue recognition related to Jounce’s first strategic collaboration with Celgene, which ended in July 2019.
  
  
• Research and development expenses: Research and development expenses were $18.0 million for the third quarter of 2020, compared to $15.1 million for the same period in 2019. The increase in research and development expenses was primarily due to increased IND-enabling expenses for JTX-1811, external clinical and regulatory costs associated with the SELECT clinical trial and increased employee compensation costs.
  
  
• General and administrative expenses: General and administrative expenses were $7.1 million for the third quarter of 2020, compared to $6.5 million for the same period in 2019. The increase in general and administrative expenses was primarily due to increased employee compensation costs.
  
  
• Net (loss) income: Net loss was $24.9 million for the third quarter of 2020, resulting in basic and diluted net loss per share of $0.73. Net income was $98.9 million for the same period in 2019, resulting in a basic net income per share of $2.99 and diluted net income per share of $2.90. The increase in net loss was primarily attributable to no license and collaboration revenue in the third quarter of 2020 and an increase in operating expenses.

Financial Guidance:

Based on its current operating and development plans, Jounce continues to expect gross cash burn on operating expenses and capital expenditures for the full year 2020 to be approximately $80.0 million to $95.0 million.

Jounce expects its existing cash, cash equivalents and investments as of September 30, combined with the

FAQ

What were Jounce Therapeutics' financial results for Q3 2020?

Jounce reported a net loss of $24.9 million, or $0.73 per share, with no revenue recognized.

When is the Phase 1 trial for JTX-8064 expected to start?

The Phase 1 trial for JTX-8064 is expected to begin by year-end 2020.

What agreement did Jounce Therapeutics establish with Gilead?

Jounce established an exclusive license agreement with Gilead for JTX-1811, securing $120 million.