Neurogene Reports First Quarter 2024 Financial Results and Highlights Recent Updates

Rhea-AI Summary

Neurogene Inc. (Nasdaq: NGNE) reported its first quarter 2024 financial results and highlighted recent corporate updates, focusing on the NGN-401 gene therapy trial for Rett syndrome. The company presented favorable safety data at the ASGCT Annual Meeting, received Australian HREC approval for the trial, and remains on track to provide interim efficacy data in Q4:24. Neurogene maintains a strong balance sheet with cash runway into 2H:26.

Positive

• Positive financial results with cash, cash equivalents, and investments totaling $169.5 million as of March 31, 2024.

• Expansion of NGN-401 trial with dosing the third patient, inclusion of additional patients and a high-dose cohort.

• Favorable safety data presented at the ASGCT Annual Meeting with NGN-401 showing good tolerance.

• Approval received to conduct the NGN-401 trial in Australia, enhancing the trial's reach.

• Anticipated milestones include releasing interim efficacy data in Q4:24 and advancing an additional product candidate in 2025.

Negative

• Increased R&D expenses of $13.5 million compared to $10.3 million in Q1 2023, driven by higher NGN-401 trial costs and preclinical expenses.

• Rise in G&A expenses to $5.2 million from $2.8 million in Q1 2023, attributed to higher compensation, professional fees, and other costs.

• Net loss of $16.9 million for Q1 2024, up from $12.3 million in Q1 2023, signaling a financial challenge.

Insights

Medical Research Analyst

The updates provided by Neurogene indicate a forward momentum in their gene therapy programs, particularly for the NGN-401 trial in Rett syndrome. The favorable safety data is a significant factor, as it may influence the drug's potential market approval paths. If interim efficacy data, expected later this year, are positive, it could lead to a surge in investor confidence. It’s noteworthy that managing adverse events related to AAV administration is a known challenge in gene therapy and Neurogene’s reported mild/Grade 1 AEs could be seen as a benchmark in the field. Looking at the financials, a strong cash position is essential for clinical-stage biotechs and Neurogene's cash runway into the second half of 2026 is an indicator of stability, allowing the company to pursue its research without the immediate need for additional financing. However, increased R&D expenses, while typical for clinical trial progression, along with elevated G&A costs due to scaling operations, have contributed to the net loss. For long-term investors, the company's commitment to advancing gene therapies and managing operational expenses could be a point of interest, but the increased net loss year-over-year could be a concern that merits monitoring.

Financial Analyst

From a financial standpoint, Neurogene's Q1 2024 report reveals a significant liquidity position, with $169.5 million in cash and equivalents, which is a strong indicator of financial health for a clinical-stage biopharmaceutical company. The cash outflows of $9.6 million for the quarter, primarily for transaction-related expenses, appear managed and within expectations for a company at this development stage. The increase in R&D expenses aligns with the company's clinical advancements, suggesting a strategic investment in its core programs. However, the year-over-year uptick in net loss may raise some flags for investors looking for profitability or reduced burn rates. The anticipated future milestones and interim data reports could serve as catalysts for stock performance. Thus, while the increased operational expenditures hint at growth, the widening net loss may warrant caution among investors sensitive to short-term cash flows.

Biotech Industry Analyst

Neurogene's strategy to expand its gene therapy platform into additional disease areas reflects an ambition to leverage transgene regulation, which could heighten the company's profile within the biotech industry. The eventual entry of an additional product candidate into the clinic in 2025 could diversify the company's pipeline and potentially open new revenue streams. Clinical development in the gene therapy space, particularly for rare diseases like Rett syndrome, is fraught with high risk but offers high reward. With the HREC approval in Australia, Neurogene's geographical expansion for its trials may reflect its commitment to global development and increases the diversity of its clinical data. Investors should note that the regulatory landscape for gene therapies is complex and evolving and alignment with FDA on a streamlined pathway for the NGN-101 program for CLN5 Batten Disease is crucial. Such alignment can significantly reduce development time and costs, improving the potential for return on investment.

Presented favorable safety data from Phase 1/2 NGN-401 gene therapy trial for Rett syndrome at ASGCT Annual Meeting

Received Australian HREC approval for NGN-401 trial

Remains on track to provide interim NGN-401 efficacy data from Cohort 1 in 4Q:24

Strong balance sheet with cash runway into 2H:26

NEW YORK--(BUSINESS WIRE)-- Neurogene Inc. (Nasdaq: NGNE), a clinical-stage company founded to bring life-changing genetic medicines to patients and families affected by rare neurological diseases, today announced first quarter 2024 financial results and highlighted recent corporate updates.

“We have made substantial progress in our NGN-401 Rett syndrome gene therapy program since the beginning of the year, including dosing the third patient, expanding the trial to include additional patients and a high-dose cohort, and the recent clearance to conduct the trial in Australia,” said Rachel McMinn, Ph.D., Founder and Chief Executive Officer of Neurogene. “We were pleased to present data at the ASGCT Annual Meeting earlier this week, which continued to show that NGN-401 has been generally well-tolerated. We remain on track to release interim efficacy data from the low-dose cohort in the fourth quarter of 2024.”

Continued Dr. McMinn, “The NGN-401 data support our strategy to expand into additional disease areas that could benefit from gene therapy with transgene regulation, and we continue to plan to advance an additional product candidate into the clinic in 2025. We remain in a strong financial position with cash runway into the second half of 2026.”

First Quarter 2024 and Recent Highlights, and Anticipated Milestones

Phase 1/2 Trial of NGN-401 Gene Therapy for Treatment of Rett Syndrome

• Presented favorable safety data from the first three pediatric patients in low-dose Cohort 1 at the American Society of Gene and Cell Therapy (ASGCT) Annual Meeting:
  • NGN-401 has been generally well-tolerated in all three patients with approximately nine, six and three months of follow-up, respectively
  • All treatment-related adverse events (AEs) have been mild/Grade 1, and all laboratory value changes are known risks of AAV administration and asymptomatic
  • No signs or symptoms of MeCP2 overexpression toxicity reported in any patient, including Patient 1 who is nine months post-dosing and has a mild MECP2 variant predicted to result in residual MeCP2 expression
  • No treatment-emergent or intracerebroventricular procedure-related serious AEs
• Announced today acknowledgment from the Australian Therapeutic Goods Administration and approval from the Human Research Ethics Committee (HREC) to conduct the Phase 1/2 clinical trial for NGN-401 in Australia, the third region in which the trial is cleared
• Continues to expect to report interim clinical data, including efficacy data from Cohort 1, in the fourth quarter of 2024; additional interim data, including from Cohort 2, are expected in the second half of 2025
• Previously expanded the trial to include a high-dose Cohort 2 and more patients in low-dose Cohort 1; these updates are expected to generate a more complete data package and inform the design of a future NGN-401 registrational study
• Remains on track to complete enrollment in Cohort 1 in the second half of 2024 and to begin enrollment in Cohort 2 in the second quarter of 2024

Phase 1/2 Trial of NGN-101 Gene Therapy for Treatment of CLN5 Batten Disease

• Continuing enrollment in high-dose Cohort 3, and plans to provide interim clinical data and a regulatory update in the second half of 2024; given the rarity of the disease, U.S. Food and Drug Administration alignment on a streamlined registrational pathway will be critical for continued investment in the program

Additional Corporate Updates

• Advancing early-stage portfolio, and anticipates an additional product candidate using transgene regulation technology to enter the clinic in 2025

Upcoming Events

• 5th Annual Goldman Sachs Global Healthcare Conference: Management will provide a corporate presentation on June 12 at 1:20 p.m. ET and participate in 1x1 meetings
• 2024 IRSF (International Rett Syndrome Foundation) Rett Syndrome Scientific Meeting: Presentation of safety data from the Phase 1/2 NGN-401 gene therapy trial for Rett syndrome on June 18-19, 2024

First Quarter 2024 Financial Results

• Cash Position: Cash, cash equivalents and investments as of March 31, 2024 were $169.5 million. Cash outflows pertaining to the transaction with Neoleukin Therapeutics, including the offering costs associated with the pre-closing financing, were $9.6 million for the quarter ended March 31, 2024. The Company expects current cash, cash equivalents and marketable securities to fund operations into the second half of 2026.
• Research & Development (“R&D”) Expenses: R&D expenses were $13.5 million for the three months ended March 31, 2024 compared to $10.3 million for the three months ended March 31, 2023. The increase in R&D expenses was primarily driven by an increase in NGN-401 clinical trial costs, increased preclinical costs related to our early discovery programs, and an increase in compensation and benefits expenses due to an increase in R&D headcount.
• General & Administrative (“G&A”) Expenses: G&A expenses were $5.2 million for the three months ended March 31, 2024 compared to $2.8 million for the three months ended March 31, 2023. The increase in G&A expenses was primarily driven by an increase in compensation and benefits expenses due to an increase in G&A headcount, professional fees, insurance, information technology and other costs associated with becoming a public company.
• Net Loss: Net loss was $16.9 million for the three months ended March 31, 2024 compared to net loss of $12.3 million for the three months ended March 31, 2023.

About Neurogene
The mission of Neurogene is to treat devastating neurological diseases to improve the lives of patients and families impacted by these rare diseases. Neurogene is developing novel approaches and treatments to address the limitations of conventional gene therapy in central nervous system disorders. This includes selecting a delivery approach to maximize distribution to target tissues and designing products to maximize potency and purity for an optimized efficacy and safety profile. The Company’s novel and proprietary EXACT transgene regulation platform technology allows for the delivery of therapeutic levels while limiting transgene toxicity associated with conventional gene therapy. Neurogene has constructed a state-of-the-art gene therapy manufacturing facility in Houston, Texas. CGMP production of NGN-401 was conducted in this facility and will support pivotal clinical development activities. For more information, visit www.neurogene.com.

Cautionary Note Regarding Forward-Looking Statements
Statements in this press release which are not historical in nature are intended to be, and hereby are identified as, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial condition, or otherwise, based on current expectations and beliefs of the management of Neurogene, as well as assumptions made by, and information currently available to, management of Neurogene, including, but not limited to, statements regarding: the therapeutic potential and utility, efficacy and clinical benefits of NGN-401 and NGN-101; the safety and tolerability profile of NGN-401; trial designs, clinical development plans and timing for each of NGN-401 and NGN-101, including anticipated timing of enrollment in and clinical trial results from the Company’s NGN-401 Phase 1/2 trial for Rett syndrome or NGN-101 Phase 1/2 trial for CLN5 Batten Disease; initiation of new clinical sites for NGN-401 in Australia; expected interactions with the FDA regarding NGN-101; nomination of additional preclinical product candidates; and our expected cash resources and liquidity. Forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “may,” “will,” “should,” “would,” “expect,” “anticipate,” “plan,” “likely,” “believe,” “estimate,” “project,” “intend,” “on track,” and other similar expressions or the negative or plural of these words, or other similar expressions that are predictions or indicate future events or prospects, although not all forward-looking statements contain these words. Forward-looking statements are based on current beliefs and assumptions that are subject to risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, likelihood, and degree of occurrence, which could cause actual results to differ materially from anticipated results and many of which are outside of Neurogene’s control. Such risks, uncertainties and assumptions include, among other things: risks related to the timing and success of enrolling patients in the expanded cohort of our Phase 1/2 clinical trial of NGN-401 for the treatment of Rett syndrome; the expected timing and results of dosing of patients in our clinical trials, including NGN-401 and NGN-101; the potential that we may not be able to expand our Phase 1/2 clinical trial of NGN-401 for the treatment of Rett syndrome into Australia based on a variety of factors, including but not limited to any decisions of regulatory authorities, costs of expanding the trial in Australia, the availability of suitable clinical test sites, and the ability to enroll patients in Australia, or other reasons; the potential for negative impacts to patients resulting from using a higher dose of NGN-401 in Cohort 2 of the Phase 1/2 clinical trial for the treatment of Rett syndrome; the risk that we may not be able to report our data on the predicted timeline; risks related to our ability to obtain regulatory approval for, and ultimately commercialize, our product candidates, including NGN-401; and other risks and uncertainties identified under the heading "Risk Factors" included in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (“SEC”) on March 18, 2024, or our Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, and other filings that the Company has made and may make with the SEC in the future. Nothing in this communication should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that the contemplated results of any such forward-looking statements will be achieved. Forward-looking statements in this communication speak only as of the day they are made and are qualified in their entirety by reference to the cautionary statements herein. Except as required by applicable law, Neurogene undertakes no obligation to revise or update any forward-looking statement, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.

This communication contains hyperlinks to information that is not deemed to be incorporated by reference into this communication.

- Financial Tables Follow -

Neurogene Inc.
Condensed Consolidated Balance Sheets
(In Thousands of U.S. dollars)
		March 31, 2024			December 31, 2023
Assets
Cash and cash equivalents		$	150,140		$	148,210
Other current assets			24,001			52,138
Non-current assets			21,209			22,225
Total assets		$	195,350		$	222,573
Liabilities
Current liabilities		$	11,818		$	22,973
Non-current liabilities			12,755			13,576
Total liabilities			24,573			36,549
Stockholders' equity			170,777			186,024
Total liabilities and stockholders' equity		$	195,350		$	222,573

Neurogene Inc.
Condensed Consolidated Statements of Operations
(In thousands of U.S. dollars, except share information)
		Three Months Ended
		March 31,
		2024				2023
Operating expenses:
Research and development		$	13,541			$	10,283
General and administrative			5,238				2,752
Total operating expenses			18,779				13,035
Loss from operations			(18,779	)			(13,035	)
Other income, net			1,858				772
Net loss		$	(16,921	)		$	(12,263	)
Per share information: (1)
Net loss per share, basic and diluted		$	(1.00	)		$	(28.28	)
Weighted-average shares of common stock outstanding, basic and diluted			16,903,735				433,623
(1) For the three months ended March 31, 2023, net loss per share information is presented for the Company’s then outstanding Class A common stock. For the three months ended March 31, 2024, net loss per share information is presented for the Company’s common stock. See Note 1, Reverse Merger and Pre-Closing Financing and Note 3, Net Loss Per Share Attributable to Common Stockholders, for additional information.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240510025849/en/

Company:

Cara Mayfield

Vice President, Corporate Affairs

cara.mayfield@neurogene.com

Investors:

Melissa Forst

Argot Partners

Neurogene@argotpartners.com

Source: Neurogene Inc.

FAQ

What is the stock symbol of Neurogene Inc.?

Neurogene Inc. is listed on Nasdaq under the ticker symbol NGNE.

What gene therapy program did Neurogene focus on in Q1 2024?

Neurogene focused on the NGN-401 gene therapy program for Rett syndrome in Q1 2024.

When is Neurogene expected to release interim efficacy data for NGN-401?

Neurogene is expected to release interim efficacy data for NGN-401 in the fourth quarter of 2024.

What was Neurogene's net loss in Q1 2024?

Neurogene reported a net loss of $16.9 million in the first quarter of 2024.