Pure Biologics has published its annual report for 2021 in which it summarizes its financial results and scientific achievements.
Development of scientific projects
“We spent the past year on intensive lab work and building business relationships with partners all over the world. We are very pleased with the progress made in both areas. As expected, as a company, we have entered the stage of preclinical research in animal models. Our first pilot experimental panel in the PB001 project, which took place in the first half of the year, ended with good results in terms of the safety of the assumed mechanism of action. In the PB002 project, we conducted the first animal study of a technical nature, thanks to which we determined certain parameters necessary for further planned steps in experiments. The other projects are also approaching the preclinical development phase. 2022 will surely be a key year for most of them.” – comments Dr. Filip Jeleń, President of the Management Board and Co-founder of Pure Biologics.
The Company’s immunooncology portfolio includes three antibody-based projects, each aimed at overcoming immunosuppression – the main obstacle to the removal of cancerous tumors by the human immune system.
The major achievements of the PB001 project during the year included the first preclinical tests in in vivo tumor models to test the safety of a novel therapeutic concept. The administered compound was safe at doses up to 250 mg/kg, which is a multiple of the expected therapeutic dose for the antibody, and thus the therapeutic concept (mechanism of action) seems safe.
In PB003 project a series of model compounds were developed that were successfully tested in cellular assays reflecting the intended therapeutic mode of action of PB003. In parallel, a series of proprietary antibodies were generated that will be used as building blocks for developing the preclinical lead candidate for PB003.
In PB004 the most important achievements include obtaining an appropriate format for the long acting BiKE (Bispecific Killer Engager) antibody targeting CD16 and ROR-1 receptors selected from the 42 structural formats initially considered. The long-acting BiKE has also been shown to be effective in triggering the killing of tumor cells exhibiting elevated levels of the ROR-1 marker by CD16-positive NK cells isolated from human blood. In March 2022, for the PB004 project, the Company entered into a contract with The Jackson Laboratory, a leading American animal research services company, to provide a research service including the first preclinical study in this project.
In 2022, proof-of-concept preclinical testing on various animal models is expected to be performed for all three immunooncology projects, and lead preclinical candidates for further development are also expected to be selected. Also for projects developing extracorporeal therapies based on aptamers, PB002 and PB005, in the year already started, in vivo efficacy studies are planned.
In PB006, targeted chemotherapy is under development for the treatment of melanoma using an aptamer targeting the IL-13R𝛼2 receptor Aptamer will carry a cytotoxic drug (directly killing cancer cells). Advances include the ongoing selection of the anti-IL-13R𝛼2 aptamer, positive experimental validation of the molecular target of the project, and development of the functional assays needed for lead molecule selection.
In November 2021, the Company granted a license for its own patented technology platform PureApta™ to the French company Novaptech – offering tests, sensors and other solutions based on aptamers. The license provides the Pure Biologics aptamer technology for research and development in Novaptech projects and assumes a joint decision on the further commercialization of the developed solutions.
Strengthening resources – a team and a new location
The key area of attention for each biotechnology company is the development of the potential of the scientific and commercial team, as well as the most modern laboratories.
The company strengthened the team, among others thanks to the joining in June 2021 of Dr. Pieter Spee, who will also join the Management Board of Pure Biologics on April 4, 2022. Dr. Spee, an immunologist, medical biologist and manager with many years of experience in international biopharmaceutical companies, is responsible for the scientific development of Pure Biologics projects.
In 2021, a two-year stock-based incentive program targeted at the Company’s key employees was also completed. All assumptions of the program have been met. The incentive program plays an important role in retaining the greatest talent.
In order to provide adequate infrastructure for the dynamic development of the Company, in December 2021, the Company signed a lease agreement for laboratory and office space in the “Business Garden” complex in Legnicka street in Wrocław. Under the contract, no later than November 1, 2022, Pure Biologics will have at its disposal an area of over 3000 m² (with the possibility of enlarging it by an additional 550 m²), which will include 1,400 m² of the most modern laboratory space.
Review of the market environment
Pure Biologics constantly monitors trends and tendencies in the partnering market, where innovative projects of biotechnology companies meet the market expectations of large pharmaceutical companies willing to take over such projects.
“Thanks to the continuous analysis of the market transactions of biotechnology companies with large pharmaceutical companies, we can evaluate the projects we are working on on an ongoing basis, and the ongoing transactions are a great justification for projects carried out in accordance with the chosen business model. Throughout 2021, we observed several significant transactions, worth almost USD 1 billion, in the immuno-oncological drug market close to our Company” – emphasizes Dr. Filip Jeleń.
The most interesting transaction confirming the right direction of the Company’s development seems to be the agreement from the beginning of October 2021, signed by Johnson & Johnson and Xencor. J&J has acquired the rights to develop and commercialize the bispecific antibody, plamotamab, which is in the first phase of clinical trials, and additional bispecific antibodies that will be developed during the two-year collaboration. Xencor received a $100 million initial fee for this transaction, and J&J will additionally purchase $25 million of the company’s shares. The partners will work together on the clinical development of plamotamab by sharing the costs – 80% of the costs will be borne by J&J, the rest will be financed by Xencor itself.
The global situation related to the COVID-19 pandemic affected the schedule and type of activities (the changes were mainly related to the change of dates, or – in some cases – the cancellation of scheduled events by the organizers), including changing the format of all events to virtual. The company actively participated in the following events:
- May 3-5, 2021 – Biotechgate Digital Partnering;
- June 10-17, 2021 – BIO Digital;
- June 29-July 1, 2021 – BOS (Biotech Outsourcing Strategies 2021) Virtual 2021;
- August 30-September 3, 2021 – Biotechgate Digital Partnering.
During the meetings arranged during these events, the Company presented a portfolio of its projects, in particular, aptamer and antibody-based candidates for drugs and therapeutic products. As a result, several dozen valuable contacts with potential partners or recipients of the technology were obtained.
The financial situation of the Company in 2021
The company’s liquidity position at the end of 2021 was very good and stable. Cash and deposit equivalents at the end of December 2021 amounted to almost PLN 33 million. By the end of 2023, the Company may still receive over PLN 70 million of non-diluting capital in the form of non-returnable subsidies for the ongoing R&D projects included in the current Pure Biologics portfolio.
Throughout the year, R&D works were carried out in accordance with the assumed budgets and there was no one-off event that would result in unexpected expenditure of a significant amount.
Due to the profile of its activity, based on research and development projects, the Company does not generate significant recurring revenues from sales.
Operating costs in 2021 amounted to PLN 28.5 million compared to PLN 28.3 million in the previous year. The net loss was PLN 11.8 million compared to PLN 11.8 million a year earlier. Revenues from subsidies in 2021 amounted to 17.8 million compared to 16.2 million a year earlier.
The achieved financial results are in line with the Company’s development strategy, which involves intensive research and development works aimed at increasing the value of the research projects held.
Regardless of its cash resources, the Company continues to use the advance financing model of subsidized R&D projects and intends to continue this model in the future. This allows to minimize the freezing of own working capital.