Tuesday, August 16, 2022

Genprex (GNPX)
REQORSA Approved For Dose Escalation In Phase 1/2 Trial

Robert LeBoyer, Vice President, Research Analyst, Life Sciences , Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Sufficient Safety Shown In First Cohort.  Genprex announced that the first cohort from its Phase 1/2 Acclaim-1 trial in non-small cell lung cancer (NSCLC) has shown sufficient safety to allow treatment of a second cohort at a higher dose. This approval from the Safety Review Committee (SRC) after it analyzed patient data in the first cohort. Genprex expects all three cohorts in the Phase 1 portion to be completed by YE22.

Mechanism Of Action Could Improve Patient Survival.  The Acclaim-1 study is Phase 1/2 trial testing the combination of REQORSA with Tagrisso (osimertinib) in non-small cell lung cancer (NSCLC).  This combines Tagrisso’s action as an EGF inhibitor with Requorsa’s delivery of the TUSC2 cancer suppressor gene.  REQORSA adds the inhibition of several pathways leading to tumor growth and proliferation, and restores pathways that defend against cancer.  The REQORSA combination has received Fast-Track designation for NSCLC from the FDA….

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Cocrystal Pharma Reports Second Quarter 2022 Financial Results and Provides Updates on its Antiviral Development Programs

Research, News, and Market Data on Cocrystal Pharma

• Planned Phase 2a study design with orally administered CC-42344 for the treatment of pandemic and seasonal influenza A
• Reported pharmacokinetic (PK) data from the single ascending dose portion of its Phase 1 study with CC-42344 supporting once-daily dosing
• Collaborated with the National Institute of Allergy and Infectious Diseases (NIAID) to evaluate the potential of the Company’s COVID-19 protease inhibitors and subsequently expanded the collaboration to support a scale-up synthesis of these inhibitors
• Initiated API (Active Pharmaceutical Ingredient) synthesis and process chemistry development with the goal in 2022 of initiating two Phase 1 healthy volunteer studies evaluating intranasal and oral protease inhibitors for COVID-19

BOTHELL, Wash., Aug.
15, 2022 (GLOBE NEWSWIRE) — Cocrystal Pharma, Inc. (Nasdaq: COCP) reports financial results for the three and six months ended June 30, 2022, and provides updates on its antiviral pipeline, upcoming milestones and business activities.

“This quarter we advanced our compounds in the clinic and announced a significant research collaboration. We were excited to announce the design of our Phase 2a human challenge study with our oral PB2 inhibitor CC-42344, enabling us to quickly evaluate antiviral efficacy and tolerability of influenza-infected healthy volunteers. Human influenza challenge studies have proven important in advancing the development of approved influenza antivirals. Additionally, due to the small sample size, a human challenge study can be completed quickly,” said Sam Lee, Ph.D., President and co-interim CEO of Cocrystal. “Later this year we expect to report results from our Phase 1 study in healthy volunteers that is underway in Australia. Our plan is to then file with the UK regulatory agency in early 2023 to proceed with the Phase 2a study.

“We have initiated API synthesis and process chemistry development with our novel, broad-spectrum COVID-19 intranasal/pulmonary and oral protease inhibitors, as we prepare data to support Investigational New Drug (IND) applications with the goal of initiating two Phase 1 healthy volunteer studies evaluating these inhibitors for COVID-19 this year,” he added.

“We continue to be well positioned to execute on our clinical and regulatory goals given our clean capital structure, cost-efficient business model and a cash balance we believe is sufficient to fund planned operations into 2024,” said James Martin, CFO and co-interim CEO. “We chose to conduct the Phase 2a influenza A trial with PB2 inhibitor CC-42344 in the UK due to the efficiency and data we expect from a human challenge model, as opposed to a traditional clinical trial model. Under the human challenge model healthy adults will be deliberately infected with influenza virus under carefully controlled conditions, which we believe will hasten trial enrollment and ensure subjects are infected with influenza A. Our niche contract research partner, Open Orphan, is one of the premier specialists in providing this unique clinical model.”

Antiviral Pipeline Overview

Many antiviral drugs are effective only against certain strains of a virus and are less effective or not effective at all against other strains or variants. Cocrystal is developing drug candidates that specifically target proteins involved in viral replication. Despite the numerous strains that may exist or emerge, these enzymes are required for viral replication and are essentially similar (highly conserved) across all strains. By targeting these highly conserved regions of the replication enzymes, our antiviral compounds are designed and tested to be effective against major virus strains.

COVID-19 and Other Coronavirus Programs
By targeting viral replication enzymes and protease, we believe it is possible to develop an effective treatment for all coronavirus diseases including COVID-19, Severe Acute Respiratory Syndrome (SARS) and Middle East Respiratory Syndrome (MERS). Our main SARS-CoV-2 protease inhibitors showed potent in
vitro pan-viral activity against common human coronaviruses, rhinoviruses and respiratory enteroviruses that cause the common cold, as well as against noroviruses that can cause symptoms of acute gastroenteritis.

In April 2022 we announced a collaboration with the NIAID to evaluate the potential of our COVID-19 3CL protease inhibitors for the treatment of COVID-19, with the NIAID responsible for in vitro and in
vivo studies evaluating the antiviral activity of the compounds. In June 2022 we expanded this collaboration by providing our proprietary process chemistry information for oral 3CL protease inhibitors to the NIAID to support scale-up synthesis of a key intermediate of these compounds.

• Intranasal/Pulmonary Protease
  Inhibitor CDI-45205
• CDI-45205 is our novel SARS-CoV-2 3CL (main) protease inhibitor being developed as a potential treatment for COVID-19 and its variants.
• We have initiated scale-up synthesis and process chemistry development with CDI-45205 as we generate data to support an IND application with the goal of progressing to a first-in-human clinical trial in 2022.
• We received guidance from the FDA regarding further preclinical and clinical development of CDI-45205 that provides a clearer pathway for the Phase 1 study we plan to initiate in 2022, as well as directives for designing a subsequent Phase 2 study.
• CDI-45205 and several analogs showed potent in vitro activity against the SARS-CoV-2 Omicron (Botswana and South Africa/BA.1), Delta (India/B.1.617.2), Gamma (Brazil/P.1), Alpha (United Kingdom/B.1.1.7) and Beta (South Africa/B.1.351) variants, surpassing the activity observed with the original wild-type (Wuhan) strain.
• CDI-45205 demonstrated good bioavailability in mouse and rat PK studies via intraperitoneal injection, and no cytotoxicity against a variety of human cell lines. CDI-45205 also demonstrated a strong synergistic effect with the FDA-approved COVID-19 medicine remdesivir.
• CDI-45205 was among the broad-spectrum viral protease inhibitors obtained from Kansas State University Research Foundation (KSURF) under an exclusive license agreement announced in April 2020. We believe the protease inhibitors obtained from KSURF have the ability to inhibit the inactive SARS-CoV-2 polymerase replication enzymes into an active form.
• Oral Protease Inhibitors

• We are investigating novel antiviral drug candidates CDI-988 and CDI-873 for development as potential oral treatments for SARS-CoV-2. Both candidates were designed and developed using our proprietary structure-based drug discovery platform technology. These agents are chemically differentiated and exhibit superior in vitro potency against SARS-CoV-2, with activity maintained against current variants of concern. Both candidates demonstrated a favorable safety profile and PK properties that are supportive of daily dosing.
• Our goal is to initiate a Phase 1 study in 2022 with one of these candidates. We believe the FDA’s guidance for further development of CDI-45205 provides us with a clearer pathway for the clinical development of our oral COVID-19 program.
• Replication Inhibitors

• We are using our proprietary structure-based drug discovery platform technology to discover replication inhibitors as orally administered therapeutic and prophylactic treatments for SARS-CoV-2. Replication inhibitors hold potential to work with protease inhibitors in a combination therapy regimen.

Influenza Programs
Influenza is a severe respiratory illness caused by either the influenza A or B virus that results in outbreaks of disease mainly during the winter months. According to a report published by Precision Reports in June 2022, the global influenza therapeutics market is projected to reach $9.5 billion by 2027, from $6.6 billion in 2020, growing at a 4.8% CAGR between 2021 and 2027. 

• Pandemic and Seasonal Influenza
  A
• A novel PB2 inhibitor, CC-42344 has shown excellent antiviral activity against influenza A strains including pandemic and seasonal strains, as well as strains resistant to Tamiflu^® and Xofluza
  ^®. CC-42344 also has favorable PK and drug-resistance profiles.
• In March 2022 we initiated enrollment in our Phase 1 study with orally administered 
  CC-42344 in healthy adults. This randomized, double-controlled, dose-escalating study is designed to assess the safety, tolerability and pharmacokinetics of CC-42344.
• In April 2022 we announced preliminary data from our Phase 1 study with CC-42344, demonstrating a favorable safety and PK profile in the first two cohorts administered single ascending doses of 100 mg and 200 mg.
• In July 2022 we announced completion of the single ascending dose portion of the Phase 1 study and reported that PK results from this portion of the study support once-daily dosing.
• We expect to report full results from the Phase 1 clinical study in 2022.
• We entered into an agreement with a clinical research organization to conduct a human challenge Phase 2a study evaluating safety, viral and clinical measures in influenza A-infected subjects. The study is expected to be initiated in the second half of 2023.
• Pandemic and Seasonal Influenza
  A/B program

• In January 2019 we entered into an Exclusive License and Research Collaboration Agreement with Merck Sharp & Dohme Corp. (“Merck”) to discover and develop certain proprietary influenza antiviral agents that are effective against both influenza A and B strains. This agreement includes milestone payments of up to $156 million plus royalties on sales of products discovered under the agreement.
• In January 2021 we announced completion of all research obligations under the agreement. Merck is now solely responsible for further preclinical and clinical development of compounds discovered under this agreement. Merck continues development activities with the compounds discovered under this agreement.

Norovirus Program

• We continue to develop certain proprietary broad-spectrum non-nucleoside polymerases for the treatment of human norovirus infections using our proprietary structure-based drug design technology platform and plan to conduct proof-of-concept animal studies.
• We also hold exclusive rights to norovirus protease inhibitors for use in humans under the KSURF license.
• Our goal is to select preclinical leads in the 2022-2023 timeframe.
• Norovirus is a global public health problem responsible for nearly 90% of epidemic, non-bacterial outbreaks of gastroenteritis around the world.

Hepatitis C Program

• We are seeking a partner to advance the development of CC-31244 following successful completion of a Phase 2a study. This compound has shown favorable safety and preliminary efficacy in a triple-regimen Phase 2a study in combination with Epclusa (sofosbuvir/velpatasvir) for the ultra-short duration treatment of individuals infected with the hepatitis C virus (HCV).
• HCV is a viral infection of the liver that causes both acute and chronic infection. In June 2022, the World Health Organization estimates that 58 million people worldwide have chronic HCV infections. 

Second Quarter 2022 Financial
Results

Research and development (R&D) expenses for the second quarter of 2022 were $2.4 million compared with $2.6 million for the second quarter of 2021, with the decrease primarily due to the influenza A program transitioning from the preclinical discovery stage into a clinical trial. The Company is anticipating increased R&D expenses during the second half of 2022 as it prepares for additional clinical trials.

General and administrative (G&A) expenses for the second quarter of 2022 were $1.4 million compared with $1.3 million for the second quarter of 2021, with the increase primarily due to legal expenses and higher insurance costs.

The Company’s litigation with an insurer resulted in the insurance company obtaining a summary judgment during the second quarter of 2022 and accounted for a potential $1.6 million adverse award by expensing this amount in the second quarter of 2022. The Company filed an appeal in July 2022. Pending the outcome of the appeal, the Company paid $1.6 million into the registry of the court which stayed execution of the Judgment.

During the six months ended June 30, 2022, the Company saw a significant decrease in the price of its common stock resulting in an overall reduction in market capitalization and our recorded net book value exceeded its market capitalization as of June 30, 2022. The Company concluded that goodwill was impaired in its entirety and recorded a $19.1 million non-cash impairment during the second quarter of 2022.

The net loss for the second quarter of 2022 was $24.4 million, or $0.25 per share, and included a non-cash impairment charge of $19.1 million resulting from the significant decrease in the price of the Company’s common stock price and market capitalization. The net loss for the second quarter of 2021 of $3.8 million, or $0.04 per share.

Six Month Financial
Results

R&D expenses for the six months ended June 30, 2022 were $5.2 million compared with $4.0 million for the first six months of 2021. G&A expenses for the six months ended June 30, 2022 were $2.7 million compared with $2.6 million for the six months ended June 30, 2021.

As stated above, the Company accounted for a potential $1.6 million legal settlement by expensing this amount during the six months ended June 30, 2022 and the Company concluded that goodwill was impaired in its entirety and recorded a $19.1 million non-cash impairment during six months ended June 30, 2022.

The net loss for the six months ended June 30, 2022 was $28.6 million, or $0.29 per share, and reflected the non-cash impairment charge described above. The net loss for the six months ended June 30, 2021 was $6.6 million, or $0.08 per share.

The Company reported unrestricted cash of $51.0 million as of June 30, 2022 compared with $58.7 million as of December 31, 2021. Net cash used in operating activities for the first half of 2022 was $7.6 million. The Company reported working capital of $48.8 million as of June 30, 2022.

About Cocrystal
Pharma, Inc.

Cocrystal Pharma, Inc. is a clinical-stage biotechnology company discovering and developing novel antiviral therapeutics that target the replication process of influenza viruses, coronaviruses (including SARS-CoV-2), hepatitis C viruses and noroviruses. Cocrystal employs unique structure-based technologies and Nobel Prize-winning expertise to create first- and best-in-class antiviral drugs. For further information about Cocrystal, please visit www.cocrystalpharma.com.

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, including statements regarding our goals of initiating two Phase 1 studies for our COVID-19 programs in 2022, our expectations of reporting data from the Phase 1 clinical study of our Influenza A product candidate later in 2022 and timeline for filing with the UK regulatory agency for a Phase 2a study in 2023, the viability and efficacy of potential treatments for coronavirus and other diseases, expectations for the global market for therapeutics, our attempts to discover replication inhibitors, our ability to execute our clinical and regulatory goals, our development of antiviral treatments for norovirus including our plan to conduct a proof-of-concept animal study and select a preclinical lead in 2022 or 2023, our expectations concerning R&D expenses, the expected sufficiency of our cash balance to fund our planned operations and our liquidity. The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “will,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events. Some or all of the events anticipated by these forward-looking statements may not occur. Important factors that could cause actual results to differ from those in the forward-looking statements include, but are not limited to, the risks arising from the impact of the COVID-19 pandemic and the Ukraine war on our Company, our collaboration partners, and on the national and global economy, including manufacturing and research delays arising from raw materials and labor shortages, supply chain disruptions and other business interruptions including and adverse impacts on our ability to obtain raw materials and test animals as well as similar problems with our vendors and our current Contract Research Organization (CRO) and any future CROs and Contract Manufacturing Organizations, the impact of inflation and Federal Reserve interest rate increases in response thereto on the economy, the ability of our current CRO to recruit volunteers for, and to proceed with, clinical studies, the results of our collaboration with NIAID relating to our 3CL protease inhibitors for the treatment of COVID-19, our reliance on Merck for further development in the influenza A/B program under the license and collaboration agreement, our and our collaboration partners’ technology and software performing as expected, financial difficulties experienced by certain partners, the results of future preclinical and clinical trials, general risks arising from clinical trials, receipt of regulatory approvals, regulatory changes, development of effective treatments and/or vaccines by competitors, including as part of the programs financed by the U.S. government, potential mutations in a virus we are targeting which may result in variants that are resistant to a product candidate we develop, and the outcome of our appeal of the summary judgment. Further information on our risk factors is contained in our filings with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2021. Any forward-looking statement made by us herein speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Investor Contact:
LHA Investor Relations
Jody Cain
310-691-7100

jcain@lhai.com

Media Contact:
JQA Partners
Jules Abraham
917-885-7378

Jabraham@jqapartners.com

Monday, August 15, 2022

Axcella Therapeutics (AXLA)
2Q Included The First of Two Phase 2 Data Announcements

Axcella is a clinical-stage biotechnology company pioneering a new approach to treat complex diseases using compositions of endogenous metabolic modulators (EMMs). The company’s product candidates are comprised of EMMs and derivatives that are engineered in distinct combinations and ratios to restore cellular homeostasis in multiple key biological pathways and improve cellular energetic efficiency. Axcella’s pipeline includes lead therapeutic candidates in Phase 2 development for the treatment of Long COVID and non-alcoholic steatohepatitis (NASH), and the reduction in risk of overt hepatic encephalopathy (OHE) recurrence. The company’s unique model allows for the evaluation of its EMM compositions through non-IND clinical studies or IND clinical trials. For more information, please visit www.axcellatx.com.

Robert LeBoyer, Vice President, Research Analyst, Life Sciences , Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

2Q Included Long COVID-19 Data Announcement and An Increase In Cash.  Axeclla reported a loss of $21.3 million or $(0.40) per share, compared with our estimate of $19.4 million or $(0.47) per share.  During the quarter, the company raised about $25 million through a direct stock offering, bringing cash and marketable securities to $44.4 million as of June 30.  The highlight of the quarter, in our opinion, was the announcement of Phase 2a data in Long COVID-19.

Phase 2a Data Was Encouraging.  The company recently announced positive data from its Phase 2a trial testing AXA1125 in Long COVID-19.  These data showed statistically significant improvements in several measures of physical and mental fatigue.  The company reiterated plans to meet with the FDA to discuss the design of the next clinical test during the coming months….

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Monday, August 15, 2022

Lineage Cell Therapeutics (LCTX)
OpRegen Collaboration Advances As Pipeline Products Move Toward INDs

Lineage Cell Therapeutics is a clinical-stage biotechnology company developing novel cell therapies for unmet medical needs. Lineage’s programs are based on its robust proprietary cell-based therapy platform and associated in-house development and manufacturing capabilities. With this platform Lineage develops and manufactures specialized, terminally differentiated human cells from its pluripotent and progenitor cell starting materials. These differentiated cells are developed to either replace or support cells that are dysfunctional or absent due to degenerative disease or traumatic injury or administered as a means of helping the body mount an effective immune response to cancer. Lineage’s clinical programs are in markets with billion dollar opportunities and include five allogeneic (“off-the-shelf”) product candidates: (i) OpRegen, a retinal pigment epithelial cell therapy in Phase 1/2a development for the treatment of geographic atrophy secondary to age-related macular degeneration; (ii) OPC1, an oligodendrocyte progenitor cell therapy in Phase 1/2a development for the treatment of acute spinal cord injuries; (iii) VAC2, a dendritic cell therapy produced from Lineage’s VAC technology platform for immuno-oncology and infectious disease, currently in Phase 1 clinical development for the treatment of non-small cell lung cancer (iv) ANP1, an auditory neuronal progenitor cell therapy for the potential treatment of auditory neuropathy, and (v) PNC1, a photoreceptor neural cell therapy for the treatment of vision loss due to photoreceptor dysfunction or damage. For more information, please visit www.lineagecell.com or follow the company on Twitter @LineageCell.

Robert LeBoyer, Vice President, Research Analyst, Life Sciences , Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Quarterly Revenues Include Revenue Recognition.  Lineage Cell Reported a loss of $6.8 million or $(0.04) per share, in-line with our estimate of $4.6 million or $(0.03) per share.  Progress on the OpRegen collaboration with Roche/Genentech accounted for revenue of $4.1 million out of $4.6 million total revenues.  The company ended the quarter with $72.0 million in cash.

OpRegen Progress Allowed Revenue Recognition.  The OpRegen collaboration with Roche/Genentech brought in net fees of about $29 million, after allocation of amounts due to its licensors.  The amount is being amortized over the course of the agreement, with revenue recognized as obligations under the agreement are met.  Lineage recognized $4.1 million under the agreement in 2Q22 and a total of $9.0 million for the year to date.  This reflects progress on Chemistry and Manufacturing Controls (CMC), technology transfers, and manufacturing milestones….

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Lineage to Present at H.C. Wainwright & Co. 2nd Annual Virtual Ophthalmology Conference

Research, News, and Market Data on Lineage Cell Therapeutics

CARLSBAD, Calif.–(
BUSINESS WIRE)–Lineage Cell
Therapeutics, Inc. (NYSE American and TASE: LCTX), a clinical-stage biotechnology company developing allogeneic cell therapies for unmet medical needs, announced today Brian M. Culley, Lineage’s Chief Executive Officer, will present at the H.C. Wainwright
2nd Annual Ophthalmology Virtual Conference, in a fireside chat hosted by Joseph Pantginis, Ph.D., Director of Research; Managing Director, Equity Research, H. C. Wainwright & Co. LLC. The fireside chat will be available to investors on demand, starting on August 17^th, 2022 at 7am ET.

Interested parties can register to view on-demand replay on the Events and
Presentations section of Lineage’s website. Additional videos are available on the Media page of the Lineage website.

About Lineage Cell Therapeutics, Inc.

Lineage Cell Therapeutics is a clinical-stage biotechnology company developing novel cell therapies for unmet medical needs. Lineage’s programs are based on its robust proprietary cell-based therapy platform and associated in-house development and manufacturing capabilities. With this platform Lineage develops and manufactures specialized, terminally differentiated human cells from its pluripotent and progenitor cell starting materials. These differentiated cells are developed to either replace or support cells that are dysfunctional or absent due to degenerative disease or traumatic injury or administered as a means of helping the body mount an effective immune response to cancer. Lineage’s clinical programs are in markets with billion dollar opportunities and include five allogeneic (“off-the-shelf”) product candidates: (i) OpRegen, a retinal pigment epithelial cell therapy in development for the treatment of geographic atrophy secondary to age-related macular degeneration, is being developed under a worldwide collaboration with Roche and Genentech, a member of the Roche Group; (ii) OPC1, an oligodendrocyte progenitor cell therapy in Phase 1/2a development for the treatment of acute spinal cord injuries; (iii) VAC2, a dendritic cell therapy produced from Lineage’s VAC technology platform for immuno-oncology and infectious disease, currently in Phase 1 clinical development for the treatment of non-small cell lung cancer; (iv) ANP1, an auditory neuronal progenitor cell therapy for the potential treatment of auditory neuropathy; and (v) PNC1, a photoreceptor neural cell therapy for the treatment of vision loss due to photoreceptor dysfunction or damage. For more information, please visit www.lineagecell.com or follow the company on Twitter @LineageCell.

Contacts

Lineage Cell Therapeutics, Inc. IR
Ioana C. Hone
(
ir@lineagecell.com)
(442) 287-8963

Russo Partners – Media Relations
Nic Johnson or David Schull
Nic.johnson@russopartnersllc.com
David.schull@russopartnersllc.com
(212) 845-4242

Ayala Pharmaceuticals Reports Second Quarter 2022 Financial Results and Provides Corporate Update

Research, News, and Market Data on Ayala Pharmaceuticals

August 15, 2022

Interim data from Part A of the RINGSIDE study
demonstrated substantial initial anti-tumor activity for AL102 as a single
agent and supports continued development

More advanced and comprehensive data set from RINGSIDE to be
presented at ESMO

REHOVOT, Israel and WILMINGTON, Del., Aug. 15, 2022 (GLOBE NEWSWIRE) — Ayala Pharmaceuticals, Inc. (Nasdaq: AYLA), a clinical-stage oncology company focused on developing and commercializing small molecule therapeutics for patients suffering from rare and aggressive cancers, primarily in genetically defined patient populations, today announced second-quarter 2022 financial results and provided a corporate update.

“We continue to make considerable progress across our pipeline, and we were particularly excited to announce interim results from the ongoing Phase 2/3 RINGSIDE trial evaluating AL102 in desmoid tumors. Although early, the results showed substantial initial anti-tumor activity and a favorable side effect profile,” said Roni Mamluk, Ph.D., Chief Executive Officer of Ayala. “Based on these positive results, our efforts are focused on finalizing the Part A of the study shortly followed by immediate initiation of Part B. For AL101, we were pleased with the latest interim results from the ACCURACY trial presented at ASCO, which demonstrated anti-tumor monotherapy activity and evidence of improved progression-free survival (PFS) in patients with recurrent/metastatic ACC.”

Second-quarter 2022
and Recent Business Highlights

• In July, announced positive interim data
  from Part A of the Phase 2/3 RINGSIDE study of AL102 in desmoid
  tumors: Data showed tumor shrinkage in substantially all patients who were evaluable at 16 weeks. AL102 was well tolerated at all three dosing regimens with no dose-limiting toxicities and no Grade 4/5 adverse events. The results from Part A will be used to determine the dose of AL102 to be evaluated in Part B of RINGSIDE, the randomized portion of the study, which Ayala is on track to initiate in 3Q 2022. More advanced and comprehensive data from RINGSIDE is expected to be presented at ESMO.
• Data on AL101 in adenoid cystic carcinoma
  (ACC) presented at ASCO 2022 Annual Meeting: In a poster at ASCO, the company provided an update from the 4mg and 6 mg AL101 cohorts in the ACCURACY study of AL101, a selective gamma-secretase inhibitor, in subjects with recurrent/metastatic (R/M) adenoid cystic carcinoma (ACC) harboring Notch activating mutations. An overall disease control rate of 66.7% was observed. The median PFS in each of the 4mg and 6mg dose cohorts was 3.7 months and 6.7 months among the patients who had a partial response.

Upcoming Milestones

• More
  advanced data from the RINGSIDE trial in desmoid tumors: Ayala expects to present a more comprehensive data set from Part A of the RINGSIDE trial of AL102 at ESMO.
• Initiation
  of Part B of the RINGSIDE trial: Part B will be a double-blind placebo-controlled study enrolling up to 156 patients with progressive disease, randomized between AL102 or placebo. The primary endpoint will be PFS with secondary endpoints including objective response rates, duration of response, and patient-reported quality of life measures.
• Initiate
  Phase 2 clinical trial evaluating AL102 in T-cell acute lymphoblastic
  leukemia (T-ALL): Ayala plans to begin an investigator-initiated Phase 2 clinical trial evaluating AL102 in R/R T-ALL around year-end.

Second-Quarter 2022 Financial Results

Cash Position: Cash and cash equivalents were $20.1 million as of June 30, 2022.

Collaboration Revenue: Collaboration revenue was $38 thousand for the second quarter of 2022, as compared to $761 thousand for the corresponding quarter in 2021.

R&D Expenses: Research and development expenses were $5.6 million for the second quarter of 2022, compared to $8.1 million for the corresponding quarter in 2021. The decrease is mainly due to the winding down of the ACCURACY study.

G&A Expenses: General and administrative expenses were $2.3 million for the second quarter of 2022, compared to $2.5 million for the second quarter of 2021.

Net Loss: Net loss was $8.2 million for the second quarter of 2022, resulting in basic and diluted net loss per share of $0.54. This compares with a net loss of $10.8 million for the second quarter of 2021 or basic and diluted net loss per share of $0.75 for that quarter.

For further details on the company’s financial results, refer to form Quarterly Report on Form 10-Q for the three months ended June 30, 2022, filed with the SEC on August 15, 2022.

About Ayala Pharmaceuticals

Ayala Pharmaceuticals, Inc. is a clinical-stage oncology company focused on developing and commercializing small molecule therapeutics for patients suffering from rare tumors and aggressive cancers. Ayala’s approach is focused on predicating, identifying and addressing tumorigenic drivers of cancer through a combination of its bioinformatics platform and next-generation sequencing to deliver targeted therapies to underserved patient populations. The company has two product candidates under development, AL101 and AL102, targeting the aberrant activation of the Notch pathway with gamma secretase inhibitors to treat a variety of tumors including desmoid tumors, adenoid cystic carcinoma and T-cell acute lymphoblastic leukemia (T-ALL). AL101, has received Fast Track Designation and Orphan Drug Designation from the U.S. FDA and is currently in a Phase 2 clinical trial for patients with ACC (ACCURACY) bearing Notch activating mutations. AL102 is currently in a Pivotal Phase 2/3 clinical trials for patients with desmoid tumors (RINGSIDE). For more information, visit www.ayalapharma.com.

Contacts:

Investors:
Joyce Allaire
LifeSci Advisors LLC
+1-617-435-6602

jallaire@lifesciadvisors.com 

Ayala Pharmaceuticals:
+1-857-444-0553

info@ayalapharma.com 

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including statements relating to our development of AL101 and AL102, the promise and potential impact of our preclinical or clinical trial data, the timing of and plans to initiate additional clinical trials of AL101 and AL102, the timing and results of any clinical trials or readouts, our participation at scientific or medical conferences, the sufficiency of cash to fund operations, and the anticipated impact of COVID-19, on our business. These forward-looking statements are based on management’s current expectations. The words ”may,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “estimate,” “believe,” “predict,” “potential” or “continue” or the negative of these terms or other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.

These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the following: we have incurred significant losses since inception and anticipate that we will continue to incur losses for the foreseeable future. We are not currently profitable, and we may never achieve or sustain profitability; we will require additional capital to fund our operations, and if we fail to obtain necessary financing, we may not be able to complete the development and commercialization of AL101 and AL102; we have identified conditions and events that raise substantial doubt about our ability to continue as a going concern; we have a limited operating history and no history of commercializing pharmaceutical products, which may make it difficult to evaluate the prospects for our future viability; we are heavily dependent on the success of AL101 and AL102, our most advanced product candidates, which are still under clinical development, and if either AL101 or AL102 does not receive regulatory approval or is not successfully commercialized, our business may be harmed; due to our limited resources and access to capital, we must prioritize development of certain programs and product candidates; these decisions may prove to be wrong and may adversely affect our business; the outbreak of COVID-19, may adversely affect our business, including our clinical trials; our ability to use our net operating loss carry forwards to offset future taxable income may be subject to certain limitations; our product candidates are designed for patients with genetically defined cancers, which is a rapidly evolving area of science, and the approach we are taking to discover and develop product candidates is novel and may never lead to marketable products; we were not involved in the early development of our lead product candidates; therefore, we are dependent on third parties having accurately generated, collected and interpreted data from certain preclinical studies and clinical trials for our product candidates; enrollment and retention of patients in clinical trials is an expensive and time-consuming process and could be made more difficult or rendered impossible by multiple factors outside our control; if we do not achieve our projected development and commercialization goals in the timeframes we announce and expect, the commercialization of our product candidates may be delayed and our business will be harmed; our product candidates may cause serious adverse events or undesirable side effects, which may delay or prevent marketing approval, or, if approved, require them to be taken off the market, require them to include safety warnings or otherwise limit their sales; the market opportunities for AL101 and AL102, if approved, may be smaller than we anticipate; we may not be successful in developing, or collaborating with others to develop, diagnostic tests to identify patients with Notch-activating mutations; we have never obtained marketing approval for a product candidate and we may be unable to obtain, or may be delayed in obtaining, marketing approval for any of our product candidates; even if we obtain FDA approval for our product candidates in the United States, we may never obtain approval for or commercialize them in any other jurisdiction, which would limit our ability to realize their full market potential; we have been granted Orphan Drug Designation for AL101 for the treatment of ACC and may seek Orphan Drug Designation for other indications or product candidates, and we may be unable to maintain the benefits associated with Orphan Drug Designation, including the potential for market exclusivity, and may not receive Orphan Drug Designation for other indications or for our other product candidates; although we have received Fast Track designation for AL101, and may seek Fast Track designation for our other product candidates, such designations may not actually lead to a faster development timeline, regulatory review or approval process; we face significant competition from other biotechnology and pharmaceutical companies and our operating results will suffer if we fail to compete effectively; we are dependent on a small number of suppliers for some of the materials used to manufacture our product candidates, and on one company for the manufacture of the active pharmaceutical ingredient for each of our product candidates; any future collaborations will be, important to our business. If we are unable to maintain our existing collaboration or enter into new collaborations, or if these collaborations are not successful, our business could be adversely affected; enacted and future healthcare legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product candidates, if approved, and may affect the prices we may set; if we are unable to obtain, maintain, protect and enforce patent and other intellectual property protection for our technology and products or if the scope of the patent or other intellectual property protection obtained is not sufficiently broad, our competitors could develop and commercialize products and technology similar or identical to ours, and we may not be able to compete effectively in our markets; we may engage in acquisitions or in-licensing transactions that could disrupt our business, cause dilution to our stockholders or reduce our financial resources; and risks related to our operations in Israel could materially adversely impact our business, financial condition and results of operations.

These and other important factors discussed under the caption “Risk Factors” in our Quarterly Report on Form 10-Q for the three months ended June 30, 2022 filed with the U.S. Securities and Exchange Commission (SEC) on August 15, 2022 and our other filings with the SEC, could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. New risk factors and uncertainties may emerge from time to time, and it is not possible to predict all risk factors and uncertainties. While we may elect to update such forward-looking statements at some point in the future, except as required by law, we disclaim any obligation to do so, even if subsequent events cause our views to change. Although we believe the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.