Cellectis Provides Business Update and Reports Financial Results for First Quarter 2020
Published on May 06, 2020 in New York, NY
- Proprietary allogeneic CAR T-cell programs on track in Phase 1 dose escalation trials; AMELI-01 in r/r AML patients, BALLI-01 in r/r B-ALL patients and MELANI-01 in r/r MM patients
- Appointed Chief Medical Officer, Carrie Brownstein, M.D., who joins from Celgene
- Construction progress of GMP manufacturing facilities on track in Paris and Raleigh
- Cash position1 of $351 million as of March 31, 2020
1 Cash position includes cash, cash equivalents and current financial assets and restricted cash. Restricted cash was $26 million as of March 31, 2020.
May 6, 2020 – New York – Cellectis (Euronext Growth: ALCLS; Nasdaq: CLLS), a clinical-stage biopharmaceutical company focused on developing immunotherapies based on allogeneic gene-edited CAR T-cells (UCART), today announced its results for the three-month period ended March 31, 2020.
“From the beginning of the COVID-19 crisis, we have made it our priority to continue all of our operations. Our three Phase 1 clinical trials are ongoing and on track, reinforcing Cellectis’ resilient commitment to cure cancer patients. We enrolled patients throughout our three Phase 1 dose escalation trials, advanced preclinical programs and remained on schedule with the construction of our in-house GMP manufacturing facilities in Raleigh and Paris,” said Dr. André Choulika, Chairman and CEO, Cellectis. “We also welcomed a new significant member to our leadership team, Dr. Carrie Brownstein, as Chief Medical Officer. Dr. Brownstein’s outstanding track record in oncology and her industry experience from Roche, Regeneron and Celgene, where she progressed products from early clinical development through commercialization, will drive the execution of our innovative UCART clinical platform.”
Cellectis will hold a conference call for investors on Thursday, May 7, 2020 at 7:30 AM EDT / 1:30 PM CET. The call will include the Company’s first quarter results and an update on business activities.
The live dial-in information for the conference call is:
US & Canada only: +1 877-407-3104
International: +1 201-493-6792
In addition, a replay of the call will be available until May 20, 2020 by calling +1 877-660-6853 (Toll Free US & Canada); +1 201-612-7415 (Toll Free International)
Conference ID: 13688263
First Quarter 2020 and Recent Highlights
Proprietary Allogeneic CAR T-Cell Development Programs
During the first quarter of 2020, we continued to enroll patients in our three proprietary Phase 1 dose escalation trials, AMELI-01 evaluating UCART123 in relapsed/refractory (R/R) acute myeloid leukemia, BALLI-01 evaluating UCART22 in R/R B-cell acute lymphoblastic leukemia and MELANI-01 evaluating UCARTCS1 in R/R multiple myeloma.
At the time of this update, all three clinical trials continue to progress through their respective dose levels. As a reminder, MELANI-01 and BALLI-01 are scheduled to complete 3 consecutive dose cohorts and AMELI-01 is scheduled to complete 4 consecutive dose cohorts, with an average duration of 3 months per dose cohort followed by expansion cohorts at the optimal dose.
The primary objective of each first-in-human dose escalation study is to evaluate the safety and determine an optimal UCART dose and corresponding lymphodepletion regimen. In addition to safety, correlative studies will evaluate T-cell expansion, window of persistence and anti-tumor activity at all dose levels.
Our allogeneic CAR T-cell product candidates have been manufactured, shipped and received by our clinical centers in the second half of 2019. Our clinical vials currently in storage are expected to cover at least the dose escalation portion of our three ongoing Phase 1 trials.
We plan to share preliminary data on our programs by the end of this year likely around the time of relevant scientific meetings, provided the enrollment of new patients and ability to conduct patient follow-up would not be significantly adversely impacted by the COVID-19 situation.
In April 2020, Cellectis announced the appointment of Carrie Brownstein, M.D., to the role of Chief Medical Officer. Dr. Brownstein oversees clinical research and development for Cellectis’ clinical programs. She is assuming her new position based in the Cellectis New York office and is joining the Company’s executive committee.
Dr. Brownstein joins Cellectis as a seasoned clinical and medical expert from Celgene, where she most recently served as Vice President, Global Clinical Research and Development, Therapeutic Area Head for myeloid diseases. In this role, Dr. Brownstein managed a clinical team of physicians and scientists across multiple global sites and was responsible for management and cross-functional development of products to treat patients with myeloid diseases. Prior to Celgene, Dr. Brownstein served as Executive Director, Clinical Sciences Oncology at Regeneron Pharmaceuticals where she led teams investigating multiple early development programs and assets, including T-cell engaging bispecific antibodies. Dr. Brownstein started her industry career at Hoffman-La Roche (Roche Pharmaceuticals), where she held roles of increasing responsibility, and most recently served as Senior Medical Director supporting the development and approval of a number of hematology and oncology therapies. Prior to her career in industry, Dr. Brownstein practiced medicine as a pediatric oncologist within notable New York institutions such as New York Presbyterian Columbia University and Mount Sinai Medical Center.
Dr. Brownstein received her M.D. from Tufts University School of Medicine and completed her internship and residency at the Babies and Children’s Hospital of Columbia Presbyterian Medical Center (NYP, Morgan Stanley Children’s Hospital) in New York, NY. She completed a fellowship in pediatric hematology and oncology at Memorial Sloan Kettering Cancer Center also in New York, NY.
In parallel, Cellectis is continuing construction of its in-house manufacturing facilities in Paris and Raleigh, and remains on track for their anticipated go-live dates in 2020 and 2021 respectively.
The 14,000 square foot manufacturing facility in Paris, France is designed to produce Cellectis’ critical raw and starting material supplies for UCART clinical studies and commercial products. The 82,000 square foot commercial-scale manufacturing facility in Raleigh, North Carolina is designed to provide GMP manufacturing for clinical supplies and commercial manufacturing upon regulatory approval.
Partnered Pipeline Updates
On March 4, 2020, we announced the execution of an amendment to the License, Development and Commercialization Agreement with Les Laboratoires Servier (Servier). Under this amendment, Cellectis granted Servier an expanded exclusive worldwide license to develop and commercialize, either directly or through its US sublicensee, Allogene Therapeutics, all next generation gene-edited allogeneic CAR T-cell products targeting CD19, including rights to UCART19/ALLO-501 and ALLO-501A, an anti-CD19 candidate in which the domains recognizable by rituximab recognition domains have been removed,
In this amendment, financial terms were improved to include an additional USD 27.6 million (EUR 25 million) upfront payment, as well as up to USD 410 million (EUR 370 million) in clinical and commercial milestones. The royalty rate was also increased from tiered high single-digit royalties to flat low double-digit royalties based on annual net sales of the licensed products.
In addition, Cellectis regained exclusive control over the five undisclosed allogeneic CAR T-cell targets previously covered by the initial agreement.
With respect to the three out-licensed programs, Allogene Therapeutics has announced that the ALPHA clinical trial evaluating UCART19 in R/R Diffused Large B-cell Lymphoma and Follicular Lymphoma, and the UNIVERSAL clinical trial evaluating UCARTBCMA in R/R multiple myeloma, have continued to enroll and dose patients, while the PALL and CALM clinical trials evaluating UCART19 in R/R B-cell acute lymphoblastic leukemia, which is sponsored by Servier, has halted recruitment due to the COVID-19 crisis.
In March 2020, Cellectis announced that the US Patent and Trademark Office (USPTO) had granted to the Company a new patent covering methods of preparing allogeneic T-cells for immunotherapy with CRISPR-Cas9 technology. This patent US10,584,352 claims “a method of preparing and administering T-cells for immunotherapy comprising the steps of: (a) providing primary human T-cells from a donor, (b) genetically modifying the primary human T-cells to eliminate expression of the T-cell receptor (TCR), comprising expressing in the cells (i) a Cas9 endonuclease fused to a nuclear localization signal (NLS), and (ii) a guide RNA that directs said endonuclease to at least one targeted locus encoding the TCR in the T-cell genome, (c) expanding the genetically modified T-cells, and (d) administering at least 10,000 of the expanded genetically modified T-cells to a patient.”
This patent complements the European patent EP3004337, claiming a method of preparing T-cells for immunotherapy using the CRISPR-Cas9 system, initially granted on August 2, 2017 and upheld by the European Patent Office (EPO) in November 2019 following an opposition procedure initiated in May 2018.
In January 2020, Cellectis was also granted European Patent EP3116902, which claims “a method for preparing an engineered T-cell comprising the steps of (a), inhibiting the expression of beta 2-microglobulin (B2M) and/of class II major histocompatibility complex transactivator (CIITA) in a T-cell that has been provided; and (b) inactivating at least one gene encoding a component of the T-cell receptor (TCR) in said T-cell; and (c) introducing into said T-cell an exogenous nucleic acid molecule comprising a nucleotide sequence coding for a Chimeric Antigen Receptor (CAR) directed against at least one antigen expressed at the surface of a malignant or infected cell.”
In January 2020, Cellectis announced the publication of a review titled “Off-the-shelf’ allogeneic CAR T cells: development and challenges” in Nature Reviews Drug Discovery by Prof. Stéphane Depil, Dr. Philippe Duchateau, Prof. Stephan Grupp, Prof. Ghulam Mufti and Dr. Laurent Poirot. The authors review the opportunities and challenges presented by universal allogeneic CAR T-cell therapies, such as the potential of taking T-cells from a healthy donor instead of using patient-derived cells and the challenge that graft-versus-host-disease (GvHD) could potentially poses during treatment.
In January 2020, Cellectis and Iovance Biotherapeutics entered into a research collaboration and exclusive worldwide license agreement whereby Cellectis grants Iovance an exclusive license under certain TALEN® technology in order to develop tumor infiltrating lymphocytes (TIL) that have been genetically edited to create more potent cancer therapeutics. This license enables Iovance Biotherapeutics’ use of TALEN® technology, addressing multiple gene targets to modify TIL for therapeutic use in several cancer indications. Financial terms of the license include development, regulatory and sales milestone payments from Iovance Biotherapeutics to Cellectis, as well as royalty payments based on net sales of TALEN®-modified TIL products.
The COVID-19 pandemic and government actions to contain it have resulted in significant disruptions to various public and commercial activities, caused disruptions to global and regional supply chains, and weighed heavily on global and regional economic conditions. As described above, Cellectis has experienced limited disruption to date from the COVID-19 crisis and has continued operations, with our three Phase 1 clinical trials and the construction of our manufacturing facilities remaining on track.
At Calyxt, there has been limited disruption to date on research and development and seed distribution. However, the COVID-19 crisis has resulted in lower demand for high oleic soybean oil, corresponding to overall lower industry demand resulting from disruptions to the food industry. Potential disruptions to protein processing facilities may also impact demand for high oleic soybean meal among Calyxt’s protein producer customers. Calyxt is responding to demand pricing and market uncertainties by adjusting its short-term crush strategy and evaluating operating expense reductions to increase financial flexibility and liquidity.
The COVID-19 situation is evolving rapidly and there remains a high degree of uncertainty regarding the duration and severity of the pandemic, government actions to contain it, and the potential impact on global and regional economic activity. Accordingly, the overall impact to Cellectis’ and Calyxt’s businesses will be dependent on future developments, which are highly uncertain and difficult to predict.
The interim condensed consolidated financial statements of Cellectis, which consolidate the results of Calyxt, Inc. of which Cellectis is a 68.8% stockholder, have been prepared in accordance with International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board (“GAAP”).
We present certain financial metrics broken out between our two reportable segments – Therapeutics and Plants – in the appendices of this First Quarter 2020 financial results press release.
First quarter 2020 Financial Results
Cash: As of March 31, 2020, Cellectis, including Calyxt, had $351 million in consolidated cash, cash equivalents, current financial assets and restricted cash of which $304 million are attributable to Cellectis on a stand-alone basis. This compares to $364 million in consolidated cash, cash equivalents, current financial assets and restricted cash as of December 31, 2019 of which $304 million was attributable to Cellectis on a stand-alone basis. This net decrease of $13 million primarily reflects (i) $33 million of proceeds in the first quarter of 2020 received from Servier in connection with the March 2020 amendment to the License, Development and Commercialization Agreement (including €5 million of Value Added Taxes which were repaid in April 2020), which was offset by (ii) $29 million of net cash flows used in operating, investing and lease financing activities of Cellectis, (iii) $13 million of net cash flows used in operating and capital expenditures activities of Calyxt and (iv) $4 million of unfavorable FOREX impact. We believe that the consolidated cash, cash equivalents, current financial assets and restricted cash position of Calyxt as of March 31, 2020 will be sufficient to fund their operations into late 2021 while amounts attributable to Cellectis will be sufficient to fund our operations into 2022.
Revenues and Other Income: Consolidated revenues and other income were $52 million for the three months ended March 31, 2020 compared to $3 million for the three months ended March 31, 2019. 95% of consolidated revenues and other income was attributable to Cellectis in the first quarter of 2020. This increase between first quarter 2020 and 2019 was mainly attributable to a $28 million upfront payment received in March 2020 and the recognition of $19 million of other previously-received upfront and milestone payments on the five released targets based on the March 2020 amendment of the License, Development and Commercialization Agreement signed with Servier. The remaining increase was explained primarily by higher high oleic soybean meal revenues at Calyxt.
Cost of Revenues: Consolidated cost of revenues were $5 million for the three-month period ended March 31, 2020 compared to $1 million for the three-month period ended March 31, 2019. This increase was primarily explained by the cost of products sold during the period by Calyxt.
R&D Expenses: Consolidated R&D expenses were $21 million for the three-month period ended March 31, 2020 compared to $15 million for the three-month period ended March 31, 2019. 87% of consolidated R&D expenses was attributable to Cellectis in the first quarter of 2020. The $6 million increase between first quarter 2020 and 2019 was primarily attributable to higher employee expenses and non-cash stock-based compensation expenses of respectively $2 million and $1 million, respectively, and to higher purchases and external expenses of $3 million at Cellectis.
SG&A Expenses: Consolidated SG&A expenses were $12 million for the three-month period ended March 31, 2020 compared to $11 million for the three-month period ended March 31, 2019. 47% of consolidated SG&A expenses was attributable to Cellectis in the first quarter of 2020. The $1 million increase was attributable to higher purchases and external expenses of $1 million at Calyxt.
Net Income (loss) Attributable to Shareholders of Cellectis: The consolidated net income attributable to Shareholders of Cellectis was $20 million (or $0.47 income per share) for the three-month period ended March 31, 2020, of which $28 million was attributed to Cellectis, compared to a loss of $15 million (or $0.36 loss per share) for the three-month period ended March 31, 2019, of which $10 million was attributable to Cellectis. This $35 million increase in net gain between first quarter 2020 and 2019 was primarily driven by a significant increase in revenues of $49 million which was partially offset by an increase in operating expenses of $11 million and a decrease in net financial gains of $3 million.
Adjusted Net Income (Loss) Attributable to Shareholders of Cellectis: The consolidated adjusted net income attributable to Shareholders of Cellectis was $24 million (or $0.57 income per share) for the three-month period ended March 31, 2020, of which $31 million was attributable to Cellectis, compared to a loss of $11 million (or $0.26 loss per share) for the three-month period ended March 31, 2019, of which $7 million was attributable to Cellectis. Please see "Note Regarding Use of Non-GAAP Financial Measures" for reconciliation of GAAP net income (loss) attributable to shareholders of Cellectis to adjusted net income (loss) attributable to shareholders of Cellectis.
We currently foresee focusing on our cash spending at Cellectis for the remainder of 2020 in the following areas:
- Supporting the development of our deep pipeline of product candidates, including the manufacturing and clinical trials expenses of UCART123, UCART22 and UCARTCS1;
- Building our state-of-the-art manufacturing capabilities in Paris and Raleigh; and
- Strengthening our manufacturing and clinical departments, including hiring talented personnel.