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Five Prime Therapeutics Announces Second Quarter 2018 Financial Results

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  • Cabiralizumab continues to advance in randomized Phase 2 trial in
    pancreatic cancer
  • Bemarituzumab has advanced through Phase 1 safety lead-in of Phase
    1/3 FIGHT global trial in gastric cancer; preparation for Phase 3
    portion underway
  • Four product candidates in the clinic, fifth planned by end of 2018

Five
Prime Therapeutics, Inc.
(NASDAQ:FPRX), a clinical-stage
biotechnology company focused on discovering and developing innovative
immuno-oncology protein therapeutics, today provided a corporate update
and reported financial results for the fiscal quarter ended June 30,
2018.

"We are pleased with the progress across our pipeline, including BMS's
ongoing randomized Phase 2 clinical trial to evaluate cabiralizumab and
OPDIVO® with and without chemotherapy as a second-line
treatment in patients with advanced pancreatic cancer," said Aron
Knickerbocker, chief executive officer of Five Prime Therapeutics.
"We've also advanced bemarituzumab through the Phase 1 safety lead-in
portion of the global FIGHT trial in gastric cancer and are on track to
begin the Phase 3 portion of the trial before the end of the year.
Additionally, we are pleased that the first clinical candidate from our
immuno-oncology research collaboration with BMS, the TIM-3 antibody
BMS-986258, is now in a Phase 1/2 trial investigating it as a single
agent and in combination with OPDIVO. FPA150, our first-in-class B7-H4
antibody, is receiving strong interest from investigators and is
progressing well in the Phase 1 trial."

Mr. Knickerbocker continued, "We are committed to making prudent
clinical development decisions. Although we continue to observe efficacy
in the PVNS Phase 2 trial, we have decided not to advance cabiralizumab
into a pivotal trial in PVNS in 2019 because patients with this chronic,
non-malignant disease demonstrate a lower tolerance for side effects,
such as periorbital edema, relative to patients with cancer."

Second Quarter 2018 Business Highlights and Recent Developments

Clinical Pipeline:

Cabiralizumab
(FPA008):
An antibody that inhibits CSF1R and has been shown to
block the activation and survival of macrophages.

  • Bristol-Myers Squibb Company (BMS) continues to advance a randomized
    Phase 2 clinical trial in patients with locally advanced or metastatic
    pancreatic cancer.
    • The Phase 2 clinical trial (NCT03336216) evaluates cabiralizumab
      and OPDIVO (nivolumab) with and without mFOLFOX6 or
      gemcitabine/Abraxane chemotherapy compared to chemotherapy alone
      as a second-line treatment in patients with advanced pancreatic
      cancer. The Phase 2 trial is expected to enroll approximately 160
      patients from the United States, Europe, Japan and Taiwan.
  • Enrollment has closed and treatment continues in Five Prime's Phase
    1a/1b clinical trial of cabiralizumab and OPDIVO (nivolumab).
    • Five Prime and BMS are evaluating the safety, tolerability and
      preliminary efficacy of the immunotherapy combination of
      cabiralizumab with the PD-1 immune checkpoint inhibitor OPDIVO in
      advanced solid tumors, including in more than 70 patients with
      pancreatic cancer.
    • A poster titled "Pharmacodynamics (PD) and Genomic Profiling of
      Pts Treated with cabiralizumab (cabira) + nivolumab (NIVO) Provide
      Evidence of On-Target Tumor Immune Modulations and Support Future
      Clinical Applications" was presented and chosen for oral
      discussion at the 2018 American Society of Clinical Oncology
      (ASCO) Annual Meeting on June 4.
      • Data suggest cabiralizumab in combination with nivolumab
        decreases immunosuppressive macrophages and increases CD8+
        effector T-cells in the tumor microenvironment.
      • These data, together with preliminary clinical response data
        observed in patients with low tumor mutational burden, support
        further clinical development of cabiralizumab plus nivolumab
        in multiple indications, including pancreatic cancer.
  • Five Prime has decided not to advance cabiralizumab in pigmented
    villonodular synovitis (PVNS), a rare, locally aggressive,
    non-malignant tumor of the synovium, into a pivotal trial under the
    current dosing schedule.
    • Five Prime has been enrolling a second cohort in the Phase 2
      portion of a Phase 1/2 clinical trial (NCT02471716) to evaluate
      dosing every 4-6 weeks instead of every 2 weeks to optimize the
      therapeutic index of cabiralizumab in PVNS.
    • Although Five Prime continues to observe efficacy in this second
      cohort, the frequency of dose interruptions and discontinuations
      suggests that the current dosing schedule is unlikely to be
      optimal for a pivotal trial in this chronic, non-fatal disease.
    • The company is considering alternative dosing schedules as there
      continues to be a high unmet need for patients with PVNS.
  • Apexigen, Inc. and Yale Cancer Center announced a clinical trial
    collaboration to evaluate APX005M (anti-CD40) in combination with
    cabiralizumab and OPDIVO. The phase 1/1b study (NCT03502330) is
    designed to identify a safe dose of APX005M to be added to
    cabiralizumab and OPDIVO. The expansion portion of the trial will
    study the triple drug combination in patients with melanoma, non-small
    cell lung cancer (NSCLC) or renal cell carcinoma (RCC) whose disease
    has progressed on a prior regimen containing a PD-1 or PD-L1 inhibitor
    without intervening therapy.

Bemarituzumab
(FPA144): 
A first-in-class isoform-selective antibody with
enhanced antibody-dependent cell-mediated cytotoxicity (ADCC) in
development as a targeted immuno-therapy for tumors that overexpress
FGFR2b.

  • Five Prime advanced through the Phase 1 safety lead-in portion
    (NCT03343301) of the Phase 1/3 FIGHT (FGFR2b
    Inhibition in Gastric
    and Gastroesophageal Junction Cancer Treatment)
    global registrational trial.
    • The company expects to initiate patient dosing in the randomized,
      controlled Phase 3 portion of the trial before the end of the year
      in the U.S., Europe and Asia, including China and South Korea,
      where the incidence of gastric cancer is high.
    • The trial will evaluate bemarituzumab in combination with the
      modified FOLFOX6 standard-of-care chemotherapy regimen (mFOLFOX6)
      versus placebo plus mFOLFOX6 in approximately 550 patients with
      advanced gastric or gastroesophageal junction cancer whose tumors
      overexpress FGFR2b.
    • Five Prime is using immunohistochemistry (IHC) and circulating
      tumor DNA (ctDNA) tests to identify the estimated 10% of patients
      with FGFR2b-overexpressing gastric cancer who would be eligible
      for the trial.
  • A poster titled "FIGHT: A Phase 3 Randomized, Double-Blind, Placebo
    Controlled Study Evaluating (Bemarituzumab) FPA144 and Modified
    FOLFOX6 (mFOLFOX6) in Patients with Previously Untreated Advanced
    Gastric and Gastroesophageal Cancer with a Dose Finding Phase 1
    Lead-In" was presented at the 2018 ASCO Annual Meeting on June 3.

FPA150
(anti-B7-H4): 
A first-in-class antibody targeting B7-H4
designed to have two mechanisms of action: to block an inhibitory T-cell
checkpoint pathway and to enhance killing of B7-H4 overexpressing tumors
by ADCC. B7-H4 is frequently overexpressed in breast, ovarian,
endometrial and bladder cancers.

  • Five Prime continues to dose patients with FPA150 monotherapy in solid
    tumors in the dose escalation phase of the Phase 1a/1b clinical trial.
  • Dose escalation will be followed by expansion in pre-specified cohorts
    of patients whose tumors have high B7-H4 expression levels, as
    measured by an IHC molecular diagnostic test. The initial targeted
    tumors for the expansion cohorts are breast, ovarian, endometrial and
    bladder cancers.
  • During the dose escalation, Five Prime will also open an exploratory
    cohort to investigate FPA150 monotherapy in patients with tumors that
    overexpress B7-H4.

BMS-986258 (anti-TIM-3): A fully-human monoclonal antibody
targeting TIM-3 (T-cell immunoglobulin and mucin domain-3), an immune
checkpoint receptor that is known to limit the duration and magnitude of
T-cell responses.

  • In January 2018, BMS began a Phase 1/2 trial (NCT03446040),
    of BMS-986258, which is testing the antibody both as a single-agent
    and in combination with OPDIVO.
  • BMS-986258 is the first clinical candidate from BMS's immuno-oncology
    research collaboration with Five Prime.

Preclinical Research and Development:

FPT155 (CD80-Fc): A first-in-class CD80 fusion protein that uses
the binding interactions of soluble CD80 to (i) directly engage CD28 to
further enhance its co-stimulatory T-cell activation activity without
inducing super agonism, and (ii) block CTLA-4 from competing for
endogenous CD80, allowing CD28 signaling to prevail in T-cell activation
in the tumor microenvironment.

  • Studies in preclinical models suggest FPT155 has the potential to be a
    potent T-cell co-stimulator with strong monotherapy antitumor activity
    and may have a synergistic effect when combined with anti-PD1 therapy.
  • Five Prime anticipates initiating a Phase 1 clinical trial of FPT155
    in Australia in the fourth quarter of 2018.

Summary of Financial Results and Guidance:

  • Cash Position. Cash, cash equivalents and marketable securities
    totaled $352.8 million as of June 30, 2018, compared to $292.7
    million as of December 31, 2017. The increase in cash, cash
    equivalents and marketable securities was primarily attributable to
    $107.6 million in net proceeds from the January 2018 public offering
    of common stock and $34.5 million in milestone and upfront payments
    Five Prime received from collaboration partners net of cash used by
    Five Prime in operations to advance its three clinical stage programs
    as well as preclinical research and development.
  • Revenue. Collaboration and license revenue for the second
    quarter of 2018 decreased by $0.2 million, or 3%, to $7.6
    million from $7.8 million for the second quarter of 2017. This
    decrease was primarily due to decreased revenue recognized under the
    cabiralizumab collaboration agreement with BMS and the Fibrosis and
    CNS collaboration with UCB, offset by the collaboration and license
    revenue from our China collaboration with Zai Lab executed in December
    2017.
  • R&D Expenses. Research and development expenses for the
    second quarter of 2018 decreased by $8.3 million, or 20%, to $33.4
    million from $41.7 million in the second quarter of 2017. This
    decrease was primarily related to decreased spending on preclinical
    programs offset by an increase in clinical expenses to advance our
    development programs.
  • G&A Expenses. General and administrative expenses for the
    second quarter of 2018 increased by $0.4 million, or 4%, to $9.8
    million from $9.4 million in the second quarter of 2017. This is
    primarily due to increased consulting and facility costs offset by
    reduced personnel costs, including stock-based compensation.
  • Net Loss. Net loss for the second quarter of 2018 was $34.1
    million, or $0.99 per basic and diluted share, compared to a net loss
    of $44.3 million, or $1.58 per basic and diluted share, for the second
    quarter of 2017.
  • Shares Outstanding. Total shares outstanding were 34.5 million
    as of June 30, 2018.

Cash Guidance. Five Prime expects full-year 2018 net cash used in
operating activities to be less than $135 million, which includes the
previously mentioned milestone payments earned by Five Prime. Five Prime
estimates ending 2018 with approximately $250 million in cash, cash
equivalents and marketable securities.

Conference Call Information

Five Prime will host a conference call and live audio webcast today
at 4:30 p.m. (ET) / 1:30 p.m. (PT) to discuss its financial results and
provide a corporate update. To participate in the conference call,
please dial (877) 878-2269 (domestic) or (253) 237-1188 (international)
and refer to conference ID 4194786. To access the live webcast please
visit the "Events & Presentations" page under the "Investors" tab on
Five Prime's website at www.fiveprime.com.
An archived copy of the webcast will be available on Five Prime's
website beginning approximately two hours after the conference call.
Five Prime will maintain an archived replay of the webcast on its
website for at least 30 days after the conference call.

About Five Prime Therapeutics

Five Prime Therapeutics, Inc. discovers and develops innovative
therapeutics to improve the lives of patients with serious diseases.
Five Prime's comprehensive discovery platform, which encompasses
virtually every medically relevant extracellular protein, positions it
to explore pathways in cancer, inflammation and their intersection in
immuno-oncology, an area with significant therapeutic potential and the
focus of the company's R&D activities. Five Prime has entered into
strategic collaborations with leading global pharmaceutical companies
and has promising product candidates in clinical and late preclinical
development. For more information, please visit www.fiveprime.com
or follow us on LinkedIn,
Twitter
and Facebook.

Cautionary Note on Forward-looking Statements

This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Words
such as "may," "will," "expect," "plan," "anticipate," "estimate,"
"intend" and similar expressions (as well as other words or expressions
referencing future events, conditions or circumstances) are intended to
identify forward-looking statements. These forward-looking statements
are based on Five Prime's expectations and assumptions as of the date of
this press release. Each of these forward-looking statements involves
risks and uncertainties. Actual results may differ materially from these
forward-looking statements. Forward-looking statements contained in this
press release include statements regarding (i) the timing of the filing
of INDs or their foreign equivalents; (ii) the timing of initiation,
progress and scope of clinical trials for Five Prime's product
candidates; (iii) the potential use of our product candidates, including
in combination with other products, to treat patients; (iv) the extent
of protein overexpression in certain patient populations; (v) the
prevalence and incidence of certain diseases; (vi) Five Prime's
full-year 2018 net cash used in operating activities; and (vii) the
amount of Five Prime's cash, cash equivalents and marketable securities
at the end of 2018. Many factors may cause differences between current
expectations and actual results including unexpected safety or efficacy
data observed during research, preclinical or clinical studies, changes
in expected or existing competition, changes in the regulatory, pricing
or reimbursement environment, and unexpected litigation or other
disputes. Other factors that may cause actual results to differ from
those expressed or implied in the forward-looking statements in this
press release are discussed in Five Prime's filings with the U.S.
Securities and Exchange Commission, including the "Risk Factors"
contained therein. Except as required by law, Five Prime assumes no
obligation to update any forward-looking statements contained herein to
reflect any change in expectations, even as new information becomes
available.

 
Five Prime Therapeutics, Inc.
Selected Balance Sheets Data
(in thousands)
   
 

  June 30,  

December 31,
2018 2017

Balance Sheet Data:

Cash, cash equivalents and marketable securities $ 352,766 $ 292,690
Total assets 396,778 344,047
Total current liabilities (excluding deferred revenue) 26,873 38,268
Deferred revenue (in total, including short term portion) 14,156 22,936

Total stockholders' equity

336,858 265,202
 
Five Prime Therapeutics, Inc.
Condensed Statements of Operations
(in thousands, except per share amounts)
       
 

For The Three
Months Ended
June 30,

For The Three
Months Ended
June 30,

For The Six
Months Ended
June 30,

For The Six
Months Ended
June 30,

2018 2017 2018 2017
Collaboration revenue $ 7,580 $ 7,822 $ 40,066 $ 17,957
Operating expenses:
Research and development 33,380 41,744 76,932 75,504
General and administrative   9,782     9,363     20,260     19,849  
Total operating expenses 43,162 51,107 97,192 95,353
Loss from operations (35,582 ) (43,285 ) (57,126 ) (77,396 )
Interest and other income, net   1,522     702     2,676     1,370  
Loss before income tax (34,060 ) (42,583 ) (54,450 ) (76,026 )
Income tax provision     (1,703 )     (1,703 )
Net loss $ (34,060 ) $ (44,286 ) $ (54,450 ) $ (77,729 )
Basic and diluted net loss per common share $ (0.99 ) $ (1.58 ) $ (1.63 ) $ (2.79 )
 
Weighted-average shares used to compute basic and diluted net loss
per common share
 

34,401

   

27,946

   

33,363

   

27,813

 
 

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