- MOMENTUM Phase 3 clinical trial enrollment on
track; top-line data anticipated in H1 2022 -
VANCOUVER, BC, Nov. 5, 2020
/PRNewswire/ - Sierra Oncology, Inc. (SRRA), a late-stage
biopharmaceutical company focused on the Phase 3 execution,
registration and potential commercialization of momelotinib, a
novel drug that may address serious unmet needs in myelofibrosis,
today reported its financial and operational results for the third
quarter ended September 30, 2020.
"We continue to make good progress in our pivotal MOMENTUM Phase
3 trial for momelotinib and anticipate completing target enrollment
by approximately mid-2021 and reporting top-line data in H1
2022, subject to any unforeseen impact from COVID-19," said Dr.
Stephen Dilly, President and CEO of
Sierra Oncology. "In addition, we anticipate presenting new
analyses from previously completed Phase 3 studies of momelotinib
at the American Society of Hematology annual meeting in December
2020."
"We are also developing our internal capabilities to support
potential future regulatory filings and commercialization of
momelotinib in the U.S., with key hires made recently in Regulatory
Affairs, Technical Operations, Legal, Pharmacovigilance,
Commercial, Business Development and Medical Affairs," added Dr.
Dilly. "We remain well capitalized to complete enrollment for the
MOMENTUM trial, report top-line results and to prepare for filing
and pre-commercialization."
Third Quarter 2020 Financial Results (all amounts reported in
U.S. currency)
Research and development expenses were
$10.4 million for the three months
ended September 30, 2020 compared with $10.1 million for the three months ended
September 30, 2019. The increase was primarily due to a
$1.5 million increase in clinical
trial costs for momelotinib and a $0.3
million increase in personnel-related costs pertaining to an
increase in stock-based compensation. These increases were offset
by a $1.5 million decrease in
clinical trial, third-party manufacturing, and research and
preclinical costs for SRA737. Research and development expenses
included non-cash stock-based compensation of $1.2 million and $0.9
million for the three months ended September 30, 2020 and 2019, respectively.
Research and development expenses were $32.2 million for the nine months ended
September 30, 2020, compared with $32.0
million for the nine months ended September 30, 2019.
The increase was primarily due to a $7.6
million increase in clinical trial and development costs for
momelotinib, and a non-cash charge of $1.5
million pertaining to the change in fair value of an
obligation to issue common stock and a warrant to Gilead Sciences,
Inc. (Gilead), which were issued during the first quarter of 2020.
These increases were offset by a $6.6
million decrease in clinical trial, third-party
manufacturing, research and preclinical costs for SRA737, a
$1.8 million decrease in
personnel-related and allocated overhead costs, and a $0.5 million decrease in third-party
manufacturing costs for momelotinib. Research and development
expenses included non-cash stock-based compensation of $2.7 million and $3.3
million for the nine months ended September 30, 2020 and 2019, respectively.
General and administrative expenses were $4.1 million for the three months ended
September 30, 2020, compared to $3.2
million for the three months ended September 30, 2019.
The increase was due to an increase in personnel-related and
allocated overhead costs of $0.7
million, primarily relating to an increase in stock-based
compensation, and an increase of $0.2
million in professional fees. General and administrative
expenses included non-cash stock-based compensation of $0.9 million and $0.4
million for the three months ended September 30, 2020 and 2019, respectively.
General and administrative expenses were $14.9 million for the nine months ended
September 30, 2020, compared to $10.0
million for the nine months ended September 30, 2019.
The increase was due to a $3.8
million increase in personnel-related and allocated overhead
costs, including a non-cash $2.2
million stock-based compensation charge pertaining to the
resignation of an executive and $1.0
million of severance charges, and an increase of
$1.1 million in professional fees
primarily relating to pre-commercial planning costs for
momelotinib. General and administrative expenses included non-cash
stock-based compensation of $4.0
million and $1.5 million for
the nine months ended September 30,
2020 and 2019, respectively.
Other income (expense), net was $22,000 of other expense, net for the three
months ended September 30, 2020, compared to $0.3 million of other income, net for the three
months ended September 30, 2019. The difference was primarily
attributable to a decrease in interest income due to lower interest
rates. Other income (expense), net was $15.7
million of other expense, net for the nine months ended
September 30, 2020, compared to $1.0
million of other income, net for the nine months ended
September 30, 2019. The difference was primarily attributable
to a non-cash charge of $16.2 million related to the change in fair
value of warrant liabilities which were reclassified to equity in
January 2020.
For the three months ended September 30, 2020, Sierra
incurred a Generally Accepted Accounting Principles (GAAP) net loss
of $14.5 million compared to a GAAP
net loss of $12.9 million for the
three months ended September 30, 2019. For the nine months
ended September 30, 2020, Sierra incurred a GAAP net loss of
$62.9 million compared to a GAAP net
loss of $40.8 million for the nine
months ended September 30, 2019. The GAAP net loss for the
nine months ended September 30, 2020 includes a non-cash
charge of $16.2 million related
to the change in fair value of warrant liabilities included in
other income (expense), net and a $1.5 million non-cash charge pertaining to
the obligation to issue securities to Gilead included in research
and development expenses as mentioned above.
Non-GAAP adjusted net loss was $12.4
million for the three months ended September 30, 2020,
compared with a non-GAAP adjusted net loss of $11.6 million for the three months ended
September 30, 2019. Non-GAAP adjusted net loss for the three
months ended September 30, 2020 and 2019 excludes expenses
related to stock-based compensation. For the nine months ended
September 30, 2020, Sierra incurred a non-GAAP adjusted net
loss of $38.5 million compared to a
non-GAAP adjusted net loss of $36.1
million for the nine months ended September 30, 2019.
Non-GAAP adjusted net loss for the nine months ended
September 30, 2020 excludes expenses related to the change in
fair value of warrant liabilities, the change in fair value of the
securities issuance obligation, and stock-based compensation.
Non-GAAP adjusted net loss for the nine months ended
September 30, 2019 excludes expenses related to stock-based
compensation. See "Non-GAAP Financial Measures" and "Reconciliation
of GAAP to Non-GAAP Financial Measures" below for a reconciliation
of this GAAP and non-GAAP financial measure.
Cash and cash equivalents totaled $109.0
million as of September 30, 2020, compared to
$147.5 million as of
December 31, 2019.
As of September 30, 2020, there were 10,495,732 total
shares of common stock outstanding and warrants to purchase
11,102,251 shares of common stock, with an exercise price equal
to $13.20 per share. There were 4,246,167 shares issuable
upon exercise of stock options and an additional warrant to
purchase 1,839 shares.
About Sierra Oncology
Sierra Oncology is a late stage
biopharmaceutical company focused on the Phase 3 execution,
registration and potential commercialization of momelotinib, a
novel drug that may address serious unmet needs in myelofibrosis.
Momelotinib is a selective and orally-bioavailable JAK1, JAK2 &
ACVR1 inhibitor with a differentiated mechanism of action that
enables it to potentially address all three key drivers of
myelofibrosis: anemia of inflammation, constitutional symptoms and
enlarged spleen. More than 1,200 subjects have received momelotinib
since clinical studies began in 2009, including more than 800
patients treated for myelofibrosis. Several of these patients
remain on treatment for more than 10 years.
Sierra is enrolling symptomatic and anemic patients, who have
been treated previously with a JAK inhibitor in MOMENTUM, a
randomized double-blind Phase 3 clinical trial. The U.S. Food and
Drug Administration has granted Fast Track designation to
momelotinib.
For more information, please
visit www.sierraoncology.com.
Cautionary Note on Forward-Looking Statements
This
press release contains forward-looking statements within the
meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, including, but not limited to,
statements regarding Sierra Oncology's expectations from current
data, anticipated clinical development activities, impact of the
COVID-19 pandemic on clinical trial plans, including enrollment and
site initiations, expected timing of release of further momelotinib
analysis, expected timing and success of enrollment of MOMENTUM,
potential benefits of momelotinib, and Sierra Oncology's
capitalization and sufficiency of its capital resources. All
statements other than statements of historical fact are statements
that could be deemed forward-looking statements. These statements
are based on management's current expectations and beliefs and are
subject to a number of risks, uncertainties and assumptions that
could cause actual results to differ materially from those
described in the forward-looking statements. Such forward-looking
statements are subject to risks and uncertainties, including, among
others, the risk that Sierra Oncology's cash resources may be
insufficient to fund its current operating plans and it may be
unable to raise additional capital when needed, the risk that
disruptions and impacts of COVID-19 will be significant and
lengthy, Sierra Oncology may be unable to successfully develop and
commercialize momelotinib, momelotinib may not demonstrate safety
and efficacy or otherwise produce positive results, Sierra Oncology
may experience delays in the clinical development of momelotinib,
Sierra Oncology may be unable to acquire additional assets to build
a pipeline of additional product candidates, Sierra Oncology's
third-party manufacturers may cause its supply of materials to
become limited or interrupted or fail to be of satisfactory
quantity or quality, Sierra Oncology may be unable to obtain and
enforce intellectual property protection for its technologies and
momelotinib and the other factors described under the heading "Risk
Factors" set forth in Sierra Oncology's filings with the Securities
and Exchange Commission from time to time. Sierra Oncology
undertakes no obligation to update the forward-looking statements
contained herein or to reflect events or circumstances occurring
after the date hereof, other than as may be required by applicable
law.
SIERRA ONCOLOGY, INC.
Condensed
Consolidated Balance
Sheets
(unaudited)
(in
thousands)
|
September 30,
2020
|
|
December 31,
2019
|
ASSETS
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
109,014
|
|
$
|
147,528
|
Prepaid expenses and
other current assets
|
|
2,956
|
|
|
2,369
|
Total current
assets
|
|
111,970
|
|
|
149,897
|
Property and
equipment, net
|
|
63
|
|
|
113
|
Operating lease
right-of-use asset
|
|
354
|
|
|
589
|
Other
assets
|
|
657
|
|
|
729
|
TOTAL
ASSETS
|
$
|
113,044
|
|
$
|
151,328
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
Accrued and other
liabilities
|
$
|
5,727
|
|
$
|
7,170
|
Accounts
payable
|
|
1,540
|
|
|
1,019
|
Deferred
revenue
|
|
200
|
|
|
—
|
Warrant
liabilities
|
|
—
|
|
|
45,935
|
Securities issuance
obligation
|
|
—
|
|
|
10,485
|
Total current
liabilities
|
|
7,467
|
|
|
64,609
|
Operating lease
liability
|
|
217
|
|
|
374
|
TOTAL
LIABILITIES
|
|
7,684
|
|
|
64,983
|
STOCKHOLDERS' EQUITY:
|
|
|
|
|
|
Preferred
stock
|
|
—
|
|
|
1
|
Common
stock
|
|
10
|
|
|
74
|
Additional paid-in
capital
|
|
933,916
|
|
|
851,957
|
Accumulated
deficit
|
|
(828,566)
|
|
|
(765,687)
|
TOTAL
STOCKHOLDERS' EQUITY
|
|
105,360
|
|
|
86,345
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
|
$
|
113,044
|
|
$
|
151,328
|
SIERRA ONCOLOGY, INC.
Condensed
Consolidated Statements of
Operations
(unaudited)
(in thousands,
except share and per share data)
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Collaboration
revenue
|
$
|
100
|
|
$
|
—
|
|
$
|
100
|
|
$
|
—
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
10,432
|
|
|
10,113
|
|
|
32,212
|
|
|
31,978
|
General and
administrative
|
|
4,112
|
|
|
3,151
|
|
|
14,916
|
|
|
9,995
|
Total operating
expenses
|
|
14,544
|
|
|
13,264
|
|
|
47,128
|
|
|
41,973
|
Loss from
operations
|
|
(14,444)
|
|
|
(13,264)
|
|
|
(47,028)
|
|
|
(41,973)
|
Other income
(expense), net:
|
|
|
|
|
|
|
|
|
|
|
|
Changes in fair value
of warrant liabilities
|
|
—
|
|
|
—
|
|
|
(16,240)
|
|
|
—
|
Other income
(expense), net
|
|
(22)
|
|
|
288
|
|
|
495
|
|
|
961
|
Total other income
(expense), net
|
|
(22)
|
|
|
288
|
|
|
(15,745)
|
|
|
961
|
Loss before provision
for (benefit from) income taxes, net
|
|
(14,466)
|
|
|
(12,976)
|
|
|
(62,773)
|
|
|
(41,012)
|
Provision for
(benefit from) income taxes, net
|
|
39
|
|
|
(73)
|
|
|
106
|
|
|
(199)
|
Net loss
|
$
|
(14,505)
|
|
$
|
(12,903)
|
|
$
|
(62,879)
|
|
$
|
(40,813)
|
Net loss per common
share, basic and diluted
|
$
|
(1.39)
|
|
$
|
(6.91)
|
|
$
|
(6.09)
|
|
$
|
(21.88)
|
Weighted-average
shares used in computing net loss per common
share,
basic and diluted
|
|
10,441,384
|
|
|
1,867,176
|
|
|
10,331,650
|
|
|
1,865,503
|
Non-GAAP Financial Measures
In addition to operating
results as calculated in accordance with GAAP, Sierra Oncology uses
certain non-GAAP financial measures when evaluating operational
performance. The following table presents the company's net loss
and net loss per common share calculated in accordance with GAAP
and as adjusted to remove the impact of certain non-cash charges.
Sierra Oncology's management believes that these non-GAAP financial
measures are useful to enhance understanding of the company's
financial performance, and are more indicative of its operational
performance and facilitate a better comparison among fiscal
periods.
These non-GAAP financial measures are not, and should not be
viewed as, substitutes for GAAP reporting measures. These non-GAAP
financial measures are not based on any comprehensive set of
accounting rules or principles, differ from GAAP measures with the
same names, and may differ from non-GAAP financial measures with
the same or similar names that are used by other companies. Sierra
Oncology believes that non-GAAP financial measures should only be
used to evaluate its results of operations in conjunction with the
corresponding GAAP financial measures. Sierra Oncology encourages
investors to carefully consider its results under GAAP, as well as
the reconciliations between these presentations, to more fully
understand our business.
Non-GAAP adjusted net loss and non-GAAP adjusted net loss per
share exclude changes in fair value for warrant liabilities,
changes in fair value for a securities issuance obligation and
stock-based compensation. Sierra Oncology excludes changes in fair
value of warrant liabilities because it is a non-cash expense and
has no direct correlation to the operation of its business. Sierra
Oncology excludes a non-cash charge pertaining to the changes in
fair value of an obligation to issue common stock and a warrant to
Gilead because it is a non-cash expense. Sierra Oncology excludes
non-cash stock-based compensation expense from its non-GAAP
financial measures because it believes that excluding this item
provides meaningful supplemental information regarding operational
performance. In particular, companies calculate stock-based
compensation expense using a variety of valuation methodologies and
subjective assumptions.
SIERRA ONCOLOGY, INC.
Reconciliation
of GAAP to Non-GAAP Financial
Measures
(unaudited)
(in thousands,
except share and per share data)
A reconciliation between GAAP net loss to non-GAAP adjusted net
loss and GAAP net loss per common share to non-GAAP adjusted net
loss per common share:
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
GAAP net
loss
|
$
|
(14,505)
|
|
$
|
(12,903)
|
|
$
|
(62,879)
|
|
$
|
(40,813)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Changes in fair value
of warrant liabilities (1)
|
|
—
|
|
|
—
|
|
|
16,240
|
|
|
—
|
Changes in fair value
to securities issuance obligation (2)
|
|
—
|
|
|
—
|
|
|
1,485
|
|
|
—
|
Stock-based
compensation (3)
|
|
2,074
|
|
|
1,280
|
|
|
6,609
|
|
|
4,737
|
Non-GAAP adjusted net
loss
|
$
|
(12,431)
|
|
$
|
(11,623)
|
|
$
|
(38,545)
|
|
$
|
(36,076)
|
GAAP net loss per
common share, basic and diluted
|
$
|
(1.39)
|
|
$
|
(6.91)
|
|
$
|
(6.09)
|
|
$
|
(21.88)
|
Adjustment to net
loss per common share
|
|
0.20
|
|
|
0.69
|
|
|
2.36
|
|
|
2.54
|
Non-GAAP adjusted net
loss per common share, basic and diluted
|
$
|
(1.19)
|
|
$
|
(6.22)
|
|
$
|
(3.73)
|
|
$
|
(19.34)
|
Weighted-average
shares used in computing net loss per common
share,
basic and diluted
|
|
10,441,384
|
|
|
1,867,176
|
|
|
10,331,650
|
|
|
1,865,503
|
(1)
|
To reflect a non-cash
charge to other income (expense), net for the changes in fair value
of warrant liabilities
|
(2)
|
To reflect a non-cash
charge to research and development expense for the changes in fair
value pertaining to the obligation to issue common stock and a
warrant to Gilead
|
(3)
|
To reflect a non-cash
stock-based compensation charge to research and development expense
and general and administrative expense
|
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SOURCE Sierra Oncology