Mereo BioPharma Reports Full Year 2021 Financial Results and Recent Highlights
Mereo BioPharma Group (NASDAQ: MREO) announced its 2021 financial results, revealing a revenue of £36.5 million from a licensing agreement with Ultragenyx. The company reported a net profit of £12.7 million, a significant improvement from the £163.6 million loss in 2020, driven by a £40 million gain from financial instruments. R&D expenses increased by 44% to £23.6 million, mainly due to advancements in the etigilimab program. Noteworthy clinical updates include promising interim results from the ACTIVATE study and FDA orphan drug designation for alvelestat.
- Revenue increased to £36.5 million from licensing agreement with Ultragenyx.
- Net profit of £12.7 million compared to a net loss of £163.6 million in 2020.
- FDA orphan drug designation received for alvelestat, indicating strong potential.
- R&D expenses rose by 44% to £23.6 million, raising concerns about financial sustainability.
LONDON and REDWOOD CITY, Calif., March 31, 2022 (GLOBE NEWSWIRE) -- Mereo BioPharma Group plc (NASDAQ: MREO) (“Mereo” or the “Company”), a clinical-stage biopharmaceutical company focused on oncology and rare diseases, today announced financial results for the year ended December 31, 2021 and provided an update on recent corporate highlights.
“During 2021, we continued to execute on all fronts and made substantial progress across our pipeline. We further advanced our etigilimab anti-TIGIT program, reporting highly promising interim data from the ongoing ACTIVATE Phase 1b/2 study and expanded our research to include clear-cell ovarian cancer through our partnership with Cancer Focus Fund and MD Anderson,” said Dr. Denise Scots-Knight, Chief Executive Officer of Mereo. “In addition, we reported positive data from multiple studies of alvelestat, which also received orphan drug designation for the treatment of AATD. We ended the year well positioned for further success in 2022, with a strong balance sheet supported by the proceeds of our public offering early last year. Following our accomplishments in 2021, we look forward to our upcoming catalysts in 2022.”
Highlights from 2021 and Recent Developments
Etigilimab (MPH-313)
- Reported interim data in Q4 2021 from ACTIVATE Phase 1b/2 open label study of etigilimab anti-TIGIT antibody in combination with nivolumab in solid tumors
- Based on analysis of 15 patients in the efficacy analysis set with a minimum of one scan to-date or clinical progression, those receiving the etigilimab / nivolumab combination have achieved one complete response in cervical cancer, one partial response in ovarian cancer and four instances of stable disease in ovarian cancer, cervical and uveal melanoma
- Well tolerated with a favorable safety profile
- Ongoing Phase 1b/2 basket combination study continues to enroll well
- Update on additional patients and durability of initial responses expected in Q2 2022
- Update on additional patients and durability of initial responses expected in Q2 2022
Alvelestat (MPH-966)
- Received orphan designation from the FDA for the treatment of AATD
- Held an R&D Day update on the alvelestat programs in Q1 2022, including in the ongoing Phase 2 trial which enrolled 99 patients with AATD
- Data expected in early Q2 2022
- Reported positive bio-marker data from investigator-sponsored Phase 1b/2 study of alvelestat in patients with BOS following hematopoietic stem cell transplantation
- Reported positive top-line results from Phase 1b/2 trial in hospitalized patients with COVID-19 respiratory disease; Alvelestat, on top of standard of care, resulted in a more rapid time to improvement in WHO Disease Severity score in the first 5-7 days compared to placebo plus standard of care.
Corporate Updates
Partnerships
- Announced partnership with the Cancer Focus Fund supporting a Phase 1b/2 clinical study of etigilimab in combination with nivolumab in clear cell ovarian cancer to be conducted at The University of Texas MD Anderson Cancer Center
- Ultragenyx expects to enroll the first patient in the Phase 2/3 study of setrusumab in 5–25 year-olds with osteogenesis imperfecta in 1H 2022
Public Offering of American Depositary Shares
- Public offering gross proceeds of
$115.1 million in Q1 2021
Strengthened Board of Directors
- Pierre Jacquet, M.D., Ph.D. appointed to Board of Directors, September 2021
- Anne Hyland appointed to Board of Directors, March 2022
Full Year 2021 Financial Results
Revenue was
Full year 2021 research and development expenses were
Administrative expenses decreased by
Net profit attributable to equity holders for the year 2021 was a net profit of
Total ordinary shares outstanding at December 31, 2021 were approximately 585 million. Total ADSs outstanding at December 31, 2021 were approximately 116.5 million, with each ADS representing five ordinary shares of the Company.
Cash and short-term deposits totaled
About Mereo BioPharma
Mereo BioPharma is a biopharmaceutical company focused on the development of innovative therapeutics that aim to improve outcomes for oncology and rare diseases and plans to commercialize selected rare disease programs. The Company has developed a portfolio of six clinical stage product candidates. Mereo’s lead oncology product candidate, etigilimab (anti-TIGIT), has advanced into an open label Phase 1b/2 basket study evaluating anti-TIGIT in combination with an anti-PD-1 in a range of tumor types including three rare tumors and three gynecological carcinomas, cervical, ovarian, and endometrial carcinomas. The Company’s second oncology product, navicixizumab, for the treatment of late line ovarian cancer, has completed a Phase 1 study and has been partnered with OncXerna Therapeutics, Inc., formerly Oncologie, Inc. The Company has two rare disease product candidates, alvelestat for the treatment of severe Alpha-1 antitrypsin deficiency (AATD) and Bronchiolitis Obliterans Syndrome (BOS), and setrusumab for the treatment of osteogenesis imperfecta (OI). Alvelestat has recently received U.S. Orphan Drug Designation for the treatment of AATD and is being investigated in an ongoing Phase 2 proof-of-concept study in the U.S. and Europe, with top-line data expected in early Q2 2022. The Company’s partner, Ultragenyx Pharmaceutical, Inc., is expected to initiate a pivotal Phase 2/3 pediatric study and young adult study (5-25 years old) for setrusumab in OI in H1 2022.
Forward-Looking Statements
This press release contains “forward-looking statements.” All statements other than statements of historical fact contained in this press release are forward-looking statements within the meaning of Section 27A of the United States Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the United States Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements usually relate to future events and anticipated revenues, earnings, cash flows or other aspects of our operations or operating results. Forward-looking statements are often identified by the words “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “could,” “may,” “estimate,” “outlook” and similar expressions, including the negative thereof. The absence of these words, however, does not mean that the statements are not forward-looking. These forward-looking statements are based on the Company’s current expectations, beliefs and assumptions concerning future developments and business conditions and their potential effect on the Company. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting the Company will be those that it anticipates.
All of the Company’s forward-looking statements involve known and unknown risks and uncertainties some of which are significant or beyond its control and assumptions that could cause actual results to differ materially from the Company’s historical experience and its present expectations or projections. You should carefully consider the foregoing factors and the other risks and uncertainties that affect the Company’s business, including those described in the “Risk Factors” section of its latest Annual Report on Form 20-F, reports on Form 6-K and other documents furnished or filed from time to time by the Company with the Securities and Exchange Commission. The Company wishes to caution you not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly update or revise any of our forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise, except to the extent required by law.
| Mereo BioPharma Contacts: | |
| Mereo | +44 (0)333 023 7300 |
| Denise Scots-Knight, Chief Executive Officer | |
| Christine Fox, Chief Financial Officer | |
| Burns McClellan (Investor Relations Adviser to Mereo) | +1 212 213 0006 |
| Lee Roth | |
| Investors | investors@mereobiopharma.com |
Consolidated Statements of Comprehensive Income/(Loss)
| Year ended December 31, | |||
| 2021 | 2020 | 2019 | |
| £'000s | £'000s | £'000s | |
| Revenue | 36,464 | – | – |
| Cost of revenue | (17,908) | – | – |
| Research and development expenses | (23,559) | (16,347) | (23,608) |
| Administrative expenses | (15,933) | (21,222) | (15,909) |
| Operating loss | (20,936) | (37,569) | (39,517) |
| Net income recognized on acquisition of subsidiary | – | – | 1,035 |
| Finance income | 1 | 44 | 377 |
| Finance costs | (4,022) | (6,383) | (4,371) |
| Changes in the fair value of financial instruments | 40,039 | (109,849) | 875 |
| Gain/(loss) on disposal of intangible assets | 113 | (10,872) | – |
| Net foreign exchange loss | (954) | (1,821) | 483 |
| Profit/(loss) before tax | 14,241 | (166,450) | (41,118) |
| Taxation | (1,516) | 2,822 | 6,274 |
| Profit/(loss) for the year, attributable to equity holders of the parent | 12,725 | (163,628) | (34,844) |
| Items that may be reclassified subsequently to profit or loss: | |||
| Currency translation of foreign operations | (191) | 349 | (499) |
| Total comprehensive income/(loss) for the year, attributable to equity holdersof the parent | 12,534 | (163,279) | (35,343) |
| Basic profit/(loss) per share for the year (in £) | 0.02 | (0.48) | (0.39) |
| Diluted loss per share for the year (in £) | (0.05) | (0.48) | (0.39) |
Consolidated Balance Sheets
| As at December 31, | ||
| 2021 | 2020 | |
| Assets | £'000s | £'000s |
| Non-current assets | ||
| Property, plant and equipment | 2,530 | 1,573 |
| Intangible assets | 24,564 | 31,648 |
| 27,094 | 33,221 | |
| Current assets | ||
| Prepayments | 2,799 | 1,619 |
| R&D tax credits | – | 2,818 |
| Other taxes receivable | 809 | 804 |
| Other receivables | 1,419 | 1,016 |
| Cash and short-term deposits | 94,296 | 23,469 |
| 99,323 | 29,726 | |
| Total assets | 126,417 | 62,947 |
| Equity and liabilities | ||
| Non-current liabilities | ||
| Provisions | 1,320 | 1,216 |
| Convertible loan notes | 14,384 | 16,142 |
| Warrant liability | 8,336 | 50,775 |
| Lease liability | 1,754 | 1,158 |
| Other liabilities | 80 | 62 |
| 25,874 | 69,353 | |
| Current liabilities | ||
| Trade and other payables | 2,499 | 3,333 |
| Accruals | 3,826 | 4,178 |
| Current tax liabilities | 1,522 | – |
| Provisions | 2,803 | 418 |
| Lease liability | 622 | 636 |
| Other liabilities | 1,269 | – |
| 12,541 | 8,565 | |
| Total liabilities | 38,415 | 77,918 |
| Net assets/(liabilities) | 88,002 | (14,971) |
| Equity | ||
| Issued capital | 1,755 | 1,017 |
| Share premium | 247,460 | 161,785 |
| Other capital reserves | 129,835 | 128,374 |
| Employee Benefit Trust shares | (1,140) | (1,305) |
| Other reserves | 7,401 | 5,001 |
| Accumulated losses | (296,968) | (309,693) |
| Translation reserve | (341) | (150) |
| Total equity | 88,002 | (14,971) |
FAQ
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