Sigilon Therapeutics Reports Third Quarter 2022 Financial Results and Business Highlights

Rhea-AI Summary

Sigilon Therapeutics, Inc. (NASDAQ: SGTX) reported Q3 2022 financial results, highlighting significant progress in its Shielded Living Therapeutics™ platform, with advancements in optimizing cross-linking chemistry and predictive models for pericapsular fibrotic overgrowth (PFO). Cash reserves decreased to $78.3 million from $123.4 million year-over-year. R&D expenses dropped to $8.3 million, reflecting a strategic reprioritization of programs, while net loss decreased to $8.7 million from $20.2 million. The company anticipates initiating IND-enabling studies for its diabetes and MPS-1 programs in H2 2023.

Positive

• Decreased net loss from $20.2 million in Q3 2021 to $8.7 million in Q3 2022.
• R&D expenses reduced from $16.6 million in Q3 2021 to $8.3 million in Q3 2022.
• Anticipated IND-enabling studies for SIG-002 and MPS-1 programs in H2 2023.

Negative

• Cash reserves declined from $123.4 million at the end of 2021 to $78.3 million as of September 30, 2022.

Identified important optimization features for its platform to mitigate PFO risks in current and future programs

Advanced iPS cell differentiation protocol for the diabetes program in preparation for anticipated IND-enabling studies in 2023

Continued optimization of the MPS-1 program, with plans to initiate IND-enabling studies in the second half of 2023

CAMBRIDGE, Mass., Nov. 10, 2022 (GLOBE NEWSWIRE) -- Sigilon Therapeutics, Inc. (NASDAQ: SGTX), a biotechnology company that seeks to develop functional cures for chronic diseases through its Shielded Living Therapeutics™ platform, today reported financial results for the third quarter ended September 30, 2022 as well as certain other business highlights.

“This year, we have made significant progress advancing our SLTx platform, including key improvements to our cross-linking chemistry designed to strengthen the stability of our spheres. In addition, we have developed preclinical models designed to predict pericapsular fibrotic overgrowth, including macrophage attachment assays and humanized mouse models, which we believe will be key to mitigating risk of an allogeneic immune response and accelerate product development,” said Rogerio Vivaldi, M.D., President and CEO of Sigilon. “I am grateful for the extraordinary effort put forth by our team to identify these important optimization features for the platform and to incorporate them into our diabetes and MPS-1 programs. We look forward to providing additional preclinical data for both programs showcasing the potential of the SLTx platform in the coming months.”

Recent Program Highlights and Anticipated Milestones

• After the development of inhibitors and the discovery of pericapsular fibrotic overgrowth (PFO) in a hemophilia A patient last year, Sigilon evaluated ways to optimize its SLTx platform. This resulted in improvements to the Company’s proprietary cross-linking chemistry, which has the potential to strengthen the spheres. Sigilon also developed allogeneic PFO prediction methods designed to rapidly evaluate the potential PFO response to encapsulated cell products. The Company has used these models to evaluate the allogeneic immune response to its current product candidates for diabetes and MPS-1. In addition, the Company expects to use these models to develop product candidates designed to avoid an allogeneic immune response and mitigate the risk of PFO, which the Company refers to as ImmunoQuiet™ cell therapies.
  

• At the Cell and Gene Therapy Meeting on the Mesa in October 2022, the Company presented data showing its proprietary iPS cell differentiation protocol for SIG-002, its product candidate for type 1 diabetes, which generates stem cell-derived islets that are similar to human cadaveric islets with a high percentage of beta cells, high levels of insulin content and glucose-regulated insulin secretion. In addition, the Company demonstrated that SIG-002 was efficacious in an STZ-induced diabetes mouse model after 10 weeks. The treated mice cleared an oral glucose challenge similar to clearance levels shown in non-diabetic control mice and maintained blood glucose levels at time zero after an overnight fast. The Company expects to initiate Investigational New Drug (IND)-enabling studies for SIG-002 in the second half of 2023 and expects to file an IND application for SIG-002 in 2024.
  

• Sigilon is optimizing its MPS-1 program to penetrate the blood brain barrier to address neurological manifestations, as well as to extend plasma half-life for the non-neurological manifestations. The Company expects to withdraw its Clinical Trial Applications (CTA) for its first MPS-1 product candidate, SIG-005, before year-end and plans to initiate IND-enabling studies for its optimized MPS-1 program in the second half of 2023. Sigilon also plans to file an IND application for a product candidate in its MPS-1 program in 2024.
  

• The Company submitted a Clinical Hold Response to the FDA for its hemophilia A program and withdrew its IND application for SIG-001. Sigilon also received approval to withdraw its CTA for SIG-001 for hemophilia A in the United Kingdom and plans to finalize activities pertaining to these regulatory filings before year-end.
  

Financial Results

• Cash Position: Cash, cash equivalents and marketable securities were $78.3 million as of September 30, 2022 compared to $123.4 million as of December 31, 2021. The decrease was primarily driven by cash used for operating activities. The Company expects that its cash, cash equivalents and marketable securities as of September 30, 2022 will support its currently anticipated operating expenses and capital expenditure requirements into 2024.
  

• R&D Expenses: Research and development expenses were $8.3 million for the third quarter of 2022 compared to $16.6 million for the third quarter of 2021. The decrease in research and development expenses was primarily related to decreased activity in ongoing platform and other early-stage program development, personnel expenses, facility-related expenses, which were offset by increased expenses related to the Company’s diabetes program. The decrease in platform and other early-stage program activity and personnel expenses was primarily due to the Company’s reprioritization of the development of the MPS-1 program, diabetes program and platform optimization following the Company’s restructuring activities in December 2021. The decrease in facility-related expenses was primarily due to the sublease of a portion of its facility.
  

• G&A Expenses: General and administrative expenses were $4.4 million for the third quarter of 2022 compared to $5.0 million for the third quarter of 2021. The decrease in general and administrative expenses was primarily related to decreased personnel expenses primarily as a result of the Company’s reprioritization and restructuring activities that occurred in December 2021 and the sublease of a portion of its facility.
  

• Net Loss: Net loss was $8.7 million for the third quarter of 2022 compared to $20.2 million for the third quarter of 2021. The decline in net loss as compared to the prior year was primarily due to savings realized from the Company’s reprioritization and corporate restructuring in December 2021.
  

About Sigilon Therapeutics
Sigilon Therapeutics seeks to develop functional cures for patients with a broad range of chronic diseases by harnessing the power of the human cell through its Shielded Living Therapeutics™ platform. Sigilon’s product candidates are non-viral engineered cell-based therapies designed to produce the crucial proteins, enzymes or other therapeutic molecules needed by patients living with chronic diseases such as lysosomal diseases and diabetes. The engineered cells are encapsulated by Sigilon’s Afibromer™ biomaterials matrix, which is designed to shield them from immune rejection. Sigilon was founded by Flagship Pioneering in conjunction with Daniel Anderson, Ph.D., and Robert Langer, Sc.D., of the Massachusetts Institute of Technology.

Forward-Looking Statements
This press release includes forward-looking statements. These forward-looking statements generally can be identified by the use of words such as “anticipate,” “expect,” “plan,” “could,” “may,” “will,” “believe,” “estimate,” “forecast,” “goal,” “project,” and other words of similar meaning. These forward-looking statements address various matters, including our expectations related to mitigation strategies for PFO, the initiation and timing of IND-enabling studies and an IND submission for SIG-002, the timing of an IND submission for a product candidate for our MPS-1 program and our expected cash runway. Each forward-looking statement contained in this press release is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statement. Applicable risks and uncertainties include, among others, that if we fail to achieve the expected financial and operational benefits of our corporate restructuring, our business and financial results may be harmed; negative results of preclinical or clinical studies of any of our product candidates could adversely affect our business and may require us to discontinue or delay development of other product candidates, which are all based on the same SLTx platform; the SLTx platform consists of novel technologies that are not yet clinically validated for human therapeutic use and the approaches we are taking to discover and develop novel therapeutics are unproven; we may not be successful in our efforts to identify and develop product candidates; if clinical trials of our current and future product candidates fail to demonstrate safety and efficacy to the satisfaction of regulatory authorities or do not otherwise produce positive results, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of such product candidates; if we are unable to obtain and maintain patent and other intellectual property protection our product candidates, our SLTx platform may be adversely affected, and the risks identified under the heading “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, and filed with the Securities and Exchange Commission (the “SEC”), as well as the other information we file with the SEC. We caution investors not to place considerable reliance on the forward-looking statements contained in this press release. You are encouraged to read our filings with the SEC, available at www.sec.gov, for a discussion of these and other risks and uncertainties. The forward-looking statements in this press release speak only as of the date of this document, and we undertake no obligation to update or revise any of these statements, except as required by law. Our business is subject to substantial risks and uncertainties, including those referenced above. Investors, potential investors, and others should give careful consideration to these risks and uncertainties.

Sigilon Therapeutics, Inc.
Condensed Consolidated Balance Sheets
(Unaudited, in thousands, except share and per share amounts)

	September 30,				December 31,
	2022				2021
Assets
Current assets:
Cash and cash equivalents	$	32,925			$	107,143
Marketable securities		45,344				16,213
Accounts receivable		23				59
Prepaid expenses and other current assets		2,084				2,729
Restricted cash—current		250				250
Total current assets		80,626				126,394
Property and equipment, net		3,053				3,994
Right‑of‑use assets		9,908				12,863
Restricted cash		1,031				1,118
Total assets	$	94,618			$	144,369
Liabilities and stockholders’ equity (deficit)
Current liabilities:
Accounts payable	$	1,408			$	2,344
Accrued expenses and other current liabilities		5,947				8,998
Lease liabilities, current portion		4,462				4,845
Current portion of long‑term debt		6,667				1,667
Deferred revenue from related party, current portion		12,071				17,034
Total current liabilities		30,555				34,888
Deferred revenue from related party, net of current portion		—				5,333
Lease liability, net of current portion		5,856				8,577
Long‑term debt, net of discount and current portion		13,621				18,411
Other liabilities		176				—
Total liabilities		50,208				67,209
Stockholders’ equity
Common stock, par value $0.001 per share; 175,000,000 shares authorized at September 30, 2022 and December 31, 2021; 32,454,237 and 32,359,895 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively		32				32
Preferred stock, par value $0.001 per share; 25,000,000 shares authorized at September 30, 2022 and December 31, 2021; no shares issued and outstanding at September 30, 2022 and December 31, 2021		—				—
Additional paid‑in capital		295,129				290,377
Accumulated other comprehensive loss		(636	)			(10	)
Accumulated deficit		(250,115	)			(213,239	)
Total stockholders’ equity		44,410				77,160
Total liabilities and stockholders’ equity	$	94,618			$	144,369

Sigilon Therapeutics, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(Unaudited, in thousands, except share and per share amounts)

	Three Months Ended September 30,								Nine Months Ended September 30,
	2022				2021				2022				2021
Revenue
Collaboration revenue	$	4,252			$	1,947			$	10,300			$	7,609
Operating expenses:
Research and development		8,280				16,645				31,775				50,381
General and administrative		4,395				5,041				14,461				15,572
Total operating expenses		12,675				21,686				46,236				65,953
Loss from operations		(8,423	)			(19,739	)			(35,936	)			(58,344	)
Other income (expense), net:
Interest income		300				56				542				212
Interest expense		(606	)			(499	)			(1,640	)			(1,481	)
Other income, net		58				26				158				47
Total other expense, net		(248	)			(417	)			(940	)			(1,222	)
Net loss attributable to ordinary shareholders	$	(8,671	)		$	(20,156	)		$	(36,876	)		$	(59,566	)
Net loss per share attributable to common stockholders—basic and diluted	$	(0.27	)		$	(0.63	)		$	(1.14	)		$	(1.88	)
Weighted average common stock outstanding—basic and diluted		32,399,855				32,055,551				32,389,771				31,707,068

SOURCE: Sigilon Therapeutics, Inc.

Investor Contact
Robert Windsor, Jr., J.D.
VP, Head of Investor Relations
Sigilon Therapeutics
robert.windsor@sigilon.com
617-586-3837

Media Contacts
Amy Bonanno
Solebury Strategic Communications
abonanno@soleburystrat.com
914-450-0349

FAQ

What were Sigilon Therapeutics' financial results for Q3 2022?

Sigilon reported a net loss of $8.7 million, down from $20.2 million in Q3 2021, with cash reserves at $78.3 million.

When does Sigilon expect to initiate IND-enabling studies?

Sigilon plans to initiate IND-enabling studies for its diabetes program (SIG-002) and MPS-1 program in the second half of 2023.

How did Sigilon's R&D expenses change in Q3 2022?

R&D expenses decreased to $8.3 million in Q3 2022, down from $16.6 million in Q3 2021.

What optimization features did Sigilon identify for its platform?

Sigilon identified key improvements in cross-linking chemistry and developed predictive models for PFO to mitigate allogeneic immune response.