Translate Bio Announces Second Quarter 2020 Financial Results and Reviews Recent Progress

Rhea-AI Summary

Translate Bio (Nasdaq: TBIO) has expanded its collaboration with Sanofi Pasteur to develop mRNA vaccines for all infectious diseases. The partnership includes a $425 million investment from Sanofi, consisting of a $300 million upfront payment and $125 million in common stock. Translate Bio reported a net loss of $36.3 million for Q2 2020, despite collaboration revenue increasing to $16.3 million from $1.2 million in Q2 2019. The company ended Q2 with $292.2 million in cash, expected to fund operations for at least 36 months while advancing its COVID-19 vaccine trials.

Positive

• Expanded collaboration with Sanofi Pasteur for mRNA vaccine development.
• Received $425 million investment from Sanofi, enhancing financial position.
• Collaboration revenue rose to $16.3 million, up from $1.2 million in Q2 2019.

Negative

• Net loss increased to $36.3 million for Q2 2020 from $27.8 million in 2019.
• Operating expenses surged to $53.0 million, up from $29.4 million in Q2 2019.

-- Expanded collaboration with partner Sanofi Pasteur for all infectious diseases further unites Translate Bio’s leading mRNA technology and large-scale manufacturing with Sanofi’s world class vaccine development and distribution --

-- Continued progress in advancing COVID-19 vaccine candidates supports goal to initiate first-in-human clinical trial Q4 2020 --

-- Strong financial position to continue to invest in platform innovation and therapeutic program development --

LEXINGTON, Mass., Aug. 06, 2020 (GLOBE NEWSWIRE) -- Translate Bio (Nasdaq: TBIO), a clinical-stage messenger RNA (mRNA) therapeutics company developing a new class of potentially transformative medicines to treat diseases caused by protein or gene dysfunction, today announced financial results for the second quarter ended June 30, 2020 and reviewed recent corporate achievements and updates.

“While navigating the challenges of the COVID-19 pandemic, we continue to make progress in our preclinical programs – both in therapeutics for pulmonary diseases and in vaccine development under our collaboration with Sanofi Pasteur,” said Ronald Renaud, chief executive officer of Translate Bio. “Additionally, for our Phase 1/2 clinical trial for MRT5005 for the treatment of cystic fibrosis (CF), we and the clinical sites are assessing the potential for patients to safely return to the clinic for study enrollment and dosing.”

Mr. Renaud continued, “This quarter, we also announced an important expansion of our work with Sanofi. We believe that this expanded agreement allows us to broadly develop mRNA vaccines with a leader in the vaccine space, leveraging their resources and expertise to potentially deliver novel infectious disease vaccines globally. Our two teams continue to work together to advance multiple programs towards clinical development, with a primary focus on the COVID-19 vaccine program and the initiation of a first-in-human clinical trial in the fourth quarter of this year.”

“As we enter the second half of the year, we believe we are in a strong financial position to continue to invest in platform innovation and to build on our proprietary delivery capabilities to support advancement of our therapeutic development programs,“ added Mr. Renaud.

Second Quarter 2020 and Recent Updates

• Expanded collaboration with Sanofi Pasteur to develop mRNA vaccines for all infectious diseases: In June 2020, Translate Bio and Sanofi Pasteur announced the expansion of their existing 2018 collaboration and license agreement to develop mRNA vaccines for all infectious diseases. In the third quarter, under the expanded agreement, Translate Bio received $425.0 million, consisting of a $300.0 million upfront payment and a $125.0 million common stock investment. Translate Bio will also be eligible for potential future milestones and other payments up to $1.9 billion and tiered royalties based on worldwide sales of the developed vaccines.
  
  
• Completed $125 million public offering of common stock: In June 2020, the Company completed a public offering of 5,681,819 shares of common stock at a public offering price of $22.00 per share, for gross proceeds of $125.0 million.

Anticipated Milestones

• COVID-19 vaccine: advance development candidate to Investigational New Drug (IND) filing with the goal of clinical trial initiation in Q4 2020 (Sanofi Pasteur collaboration)
• Flu vaccine: advance development candidate to IND filing with clinical trial initiation anticipated mid-year 2021 (Sanofi Pasteur collaboration)
• MRT5005 (CF): report results from additional single-ascending dose group and multiple-ascending dose portion of Phase 1/2 clinical trial
• Preclinical pulmonary programs: advance next-generation CF, Primary Ciliary Dyskinesia, Idiopathic Pulmonary Fibrosis and Pulmonary Arterial Hypertension programs toward selection of development candidate
• Platform: identify next-generation lipid nanoparticles (LNPs) to support liver, lung and additional disease program development

Upcoming Events

• The Company will participate in the following virtual investment banking conferences:
       - Citi's 15th Annual BioPharma Virtual Conference, September 9-10, 2020
       - SVB Leerink CybeRx Series: Vaccine Forum, September 23-24, 2020
       - SVB Leerink CybeRx Series: Rare & Genetics, October 1, 2020
• The Company will give a presentation at the North American Cystic Fibrosis Conference, October 21-23, 2020, during a session entitled: Novel Nucleic Acid Strategies to Treat the Fundamental CF Defect

Second Quarter 2020 Financial Results and Financial Guidance

Translate Bio ended the second quarter of 2020 with $292.2 million in cash, cash equivalents and short-term investments and 69,359,509 shares of common stock outstanding. The Company expects that its existing cash, cash equivalents and short-term investments, together with the upfront payment and common stock equity investment of approximately $425.0 million from Sanofi received in the third quarter of 2020, will be sufficient to fund its operating expenses and capital expenditure requirements for at least the next 36 months.

Translate Bio reported a net loss of $36.3 million and $27.8 million for the three months ended June 30, 2020 and 2019, respectively.

Collaboration revenue was $16.3 million and $1.2 million for the three months ended June 30, 2020 and 2019, respectively, which was derived from the collaboration with Sanofi. The increase was related to increased activities for the vaccine program in the three months ended June 30, 2020 compared to the same period in 2019.

Operating expenses for the three months ended June 30, 2020 were $53.0 million, compared to $29.4 million for the same period in 2019, and were comprised of the following:

• Research and development expenses of $29.0 million during the second quarter of 2020, compared to $16.6 million for the same period in 2019. The increase is primarily due to continued development of the Company’s vaccine and discovery programs as well as an increase in personnel-related costs, partially offset by a decrease in expenses related to the Company’s MRT5201 and MRT5005 programs.
   
• General and administrative expenses of $8.6 million during the second quarter of 2020, compared to $7.9 million for the same period in 2019.
   
• Operating expenses of $15.3 million for change in the fair value of contingent consideration related to future potential milestone and earnout payment obligations. The expense recognized was primarily attributed to an increase in the fair value of the contingent consideration liability due to the time value of money due to the passage of time and a decrease in the discount rate.

About Translate Bio
Translate Bio is a clinical-stage mRNA therapeutics company developing a new class of potentially transformative medicines to treat diseases caused by protein or gene dysfunction.  Translate Bio is primarily focused on applying its technology to treat pulmonary diseases caused by insufficient protein production or where the reduction of proteins can modify disease. Translate Bio’s lead mRNA therapeutic program is being developed as a treatment for cystic fibrosis (CF) and is in a Phase 1/2 clinical trial. The Company is also pursuing the development of mRNA vaccines for infectious diseases under a collaboration with Sanofi Pasteur. The Company also believes its technology is applicable to a broad range of diseases, including diseases that affect the liver. Additionally, the platform may be applied to various classes of treatments, such as therapeutic antibodies for infectious disease and other diseases. For more information about the Company, please visit www.translate.bio or on Twitter at @TranslateBio.

Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, those regarding:  the potential for MRT5005 to address the underlying cause of CF and benefit patients; Translate Bio’s plans to resume enrollment and dosing its paused Phase 1/2 clinical trial of MRT5005; Translate Bio’s expectations with respect to its collaboration with Sanofi, including the anticipated advancement towards an IND filing and initiating clinical trials for a COVID-19 vaccine in Q4 2020, the anticipated IND filing with clinical trial initiation for a flu vaccine in mid-year 2021, and the development of mRNA vaccines and the delivery of infectious vaccines globally; Translate Bio’s plans to advance its pipeline of mRNA therapeutics and validate targets for additional pulmonary diseases;  Translate Bio’s plans to advance its additional disease program programs and platform; the period in which Translate Bio expects that its existing cash, cash equivalents and investments will enable it to fund its operations; Translate Bio’s beliefs regarding the broad applicability of its MRT platform; and Translate Bio’s plans, strategies and prospects for its business, including its lead development programs. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Such statements are subject to numerous important factors, risks and uncertainties that may cause actual events or results to differ materially from current expectations and beliefs, including but not limited to:  the current and potential future impacts of the COVID-19 pandemic on the Company’s business, financial condition, operations and liquidity; Translate Bio’s ability to advance the development of its platform and programs under the timelines it projects, demonstrate the requisite safety and efficacy of its product candidates and replicate in clinical trials any positive findings from preclinical studies; the successful advancement of the collaboration agreement between Translate Bio and Sanofi; uncertainties relating to the discovery and development of vaccine candidates based on mRNA, and specifically as it relates to the novel coronavirus, COVID-19; the content and timing of decisions made by the FDA, other regulatory authorities and investigational review boards at clinical trial sites, including decisions as it relates to ongoing and planned clinical trials; Translate Bio’s ability to obtain, maintain and enforce necessary patent and other intellectual property protection; the availability of significant cash required to fund operations; competitive factors; general economic and market conditions and other important risk factors set forth under the caption “Risk Factors” in Translate Bio’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2020 filed with the Securities and Exchange Commission on August 6, 2020 and in any other subsequent filings made by Translate Bio. Any forward-looking statements contained in this press release speak only as of the date hereof, and Translate Bio specifically disclaims any obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.

TRANSLATE BIO, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)
(UNAUDITED)
		Three Months Ended June 30,								Six Months Ended June 30,
			2020				2019				2020				2019
Collaboration revenue		$	16,319			$	1,174			$	20,974			$	2,648
Operating expenses:
Research and development			29,002				16,625				50,442				34,048
General and administrative			8,601				7,850				16,060				14,403
Change in fair value of contingent consideration			15,347				4,889				5,895				16,591
Total operating expenses			52,950				29,364				72,397				65,042
Loss from operations			(36,631	)			(28,190	)			(51,423	)			(62,394	)
Interest income			343				358				853				878
Loss before benefit from income taxes			(36,288	)			(27,832	)			(50,570	)			(61,516	)
Benefit from income taxes			—				—				—				486
Net loss		$	(36,288	)		$	(27,832	)		$	(50,570	)		$	(61,030	)

TRANSLATE BIO, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
(UNAUDITED)
			June 30,				December 31,
				2020				2019
Assets
Current assets:
Cash and cash equivalents			$	272,193			$	84,580
Short-term investments				20,029				104,098
Collaboration receivables				15,131				4,596
Prepaid expenses and other current assets				7,918				9,391
Restricted cash				950				950
Total current assets				316,221				203,615
Property and equipment, net				15,154				12,539
Right-of-use assets, net				10,130				10,400
Goodwill				21,359				21,359
Intangible assets, net				81,280				85,536
Other assets				10,134				2,752
Total assets			$	454,278			$	336,201
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable			$	12,912			$	15,968
Accrued expenses				11,126				7,072
Current portion of deferred revenue				27,109				18,100
Current portion of operating lease liability				619				530
Total current liabilities				51,766				41,670
Contingent consideration				109,550				103,655
Deferred revenue, net of current portion				9,818				25,256
Operating lease liability, net of current portion				11,751				12,084
Total liabilities				182,885				182,665
Stockholders’ equity:
Common stock				69				60
Additional paid-in capital				680,850				512,231
Accumulated deficit				(410,066	)			(359,496	)
Accumulated other comprehensive income				540				741
Total stockholders' equity				271,393				153,536
Total liabilities and stockholders' equity			$	454,278			$	336,201

Contacts for Translate Bio
Investors	Media
Teri Dahlman	Maura Gavaghan
tdahlman@translate.bio	mgavaghan@translate.bio
617-817-8655	617-233-1154

FAQ

What is the recent financial performance of Translate Bio (TBIO) for Q2 2020?

Translate Bio reported a net loss of $36.3 million for Q2 2020, compared to a loss of $27.8 million in Q2 2019. Collaboration revenue increased to $16.3 million.

How much funding did Translate Bio receive from Sanofi Pasteur?

Translate Bio received $425 million from Sanofi, including a $300 million upfront payment and a $125 million common stock investment.

What are the upcoming milestones for Translate Bio's COVID-19 vaccine?

Translate Bio aims to initiate the first-in-human clinical trial for its COVID-19 vaccine by Q4 2020.