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ERYTECH Provides Business and Financial Update for the First Half of 2022

·11-min read
Erytech Pharma S.A.
Erytech Pharma S.A.

ERYTECH Provides Business and Financial Update
for the First Half of 2022

Conference call and webcast on Tuesday, September 13, 2022
at 8:30am ET / 02:30pm CEST

  • U.S. cell therapy manufacturing facility sold to Catalent in April 2022

  • Evaluation of partnering options ongoing, strategic initiative expected in Q4 2022

  • Plans to pursue a BLA submission for Graspa® in hypersensitive ALL stopped

  • Cash and cash equivalents of €53.3 million ($55.8 million) at the end of June 2022

Cambridge, MA (U.S.) and Lyon (France), September 12, 2022 ERYTECH Pharma (Nasdaq & Euronext: ERYP), a clinical-stage biopharmaceutical company developing innovative therapies by encapsulating therapeutic drug substances inside red blood cells, today provided a business and financial update for the first half of 2022.

2022 has been so far, and will continue to be, a year of deep strategic refoundation for ERYTECH,said Gil Beyen, Chief Executive Officer of ERYTECH.Earlier this year and as a first result of the strategic review initiated last Fall after the disappointment of our Phase 3 trial in pancreatic cancer, we made a first important step with the sale of our U.S. production facility in Princeton, which significantly improved ERYTECH’s financial prospects and gave us the latitude to continue the transformation of the Company. The recent decision to halt the submission process of our BLA dossier for eryaspase in hypersensitive ALL leads us now to focus on strategic alternatives for ERYTECH. We have prioritized our resources on our most promising preclinical programs, and we are making good progress on partnering discussions, for which we expect to report updates in the last quarter of this year.

Business Highlights

  • U.S. cell therapy manufacturing facility sold to Catalent for a total consideration of USD 44.5 million

In April 2022, ERYTECH sold its commercial-scale cell therapy manufacturing facility in Princeton, New Jersey, to Catalent, for a total consideration of $44.5 million. ERYTECH’s staff at the site of 40 people has been fully transferred to Catalent.

ERYTECH maintained its GMP-approved manufacturing site in Lyon, France and its core expertise to continue innovating in cell therapy.

  • Good progress on strategic review and partnering alternatives

As announced on October 25th 2021, the Company has appointed a specialized advisor to evaluate its strategic and partnering options. After the transaction with Catalent, the Company has continued to evaluate further valuable strategic options to potentially leverage its assets and capabilities in a business combination with a strategic partner. Valuable options are under discussion and the Company expects to give further updates on these strategic initiatives in the 4th quarter of this year.

  • Plans to pursue a BLA submission for Graspa® in hypersensitive ALL stopped following recent feedbacks and new additional requests from the FDA

Following positive results of a Phase 2 trial, sponsored by the Nordic Organization for Peadiatric Hematology and Oncology (NOPHO), ERYTECH had been in an extended dialogue with the U.S. Food and Drug Administration (FDA) to evaluate the possibility for an approval of Graspa in acute lymphoblastic leukemia (ALL) patients who had previously experienced hypersensitivity reactions to pegylated asparaginase therapy.

A pre-BLA meeting to discuss the submission of a Biologics License Application (BLA) took place in June 2021 after which the Company confirmed its intention to submit a BLA, subject to successful completion of remaining activities, which included the submission of additional information to the FDA, responses to additional data requests, and the submission of the Initial Pediatric Study Plan (iPSP).

The Company submitted its iPSP in July 2022 and received feedback from the FDA in August 2022. After thorough evaluation of this feedback, which included a new request for additional data, and taking into account the changing competitive landscape, the Company decided to halt the BLA process of seeking approval.

  • Results of patients enrolled in TRYbeCA-2, Phase 2 clinical trial in triple-negative breast cancer (TNBC), reviewed

The TRYbeCA-2 trial evaluated eryaspase in combination with gemcitabine and carboplatin chemotherapy, compared to chemotherapy alone, in metastatic TNBC (first and second lines), with disease control rate as the primary end point of the trial.

Initial target enrollment was approximately 64 evaluable patients but following the disappointing results of eryaspase in the TRYbeCA-1 trial in second-line pancreatic cancer, the Company had decided, in consultation with the trial’s Steering Committee, to stop further enrollment in the trial. A total of 27 patients,11 and 14 evaluable patients in the eryaspase and control arms, respectively, have been finally enrolled.

The trial’s Steering Committee met in September 2022 to review the results of the 25 evaluable patients. No clinical benefit was demonstrated, which could be attributed to the immature closure of the trial and the small number of patients. The treatment was well tolerated.

  • Promising preclinical development with ERYCEVTM, novel red blood cell vesiculation technology

In April 2022, ERYTECH announced the presentation of its novel red blood cell vesiculation technology, ERYCEV, at the 24th Meeting of the European Red Cell Society (ERCS).

RBC-derived extracellular vesicles are formed naturally during senescence and storage of mature RBCs and are a potentially attractive drug delivery system. Vesiculation of RBCs that have already been loaded with active therapeutic compounds utilizing the ERYCAPS® process, entails the potential of producing cargo-loaded RBC-derived extracellular vesicles for the development of novel therapeutic approaches.

ERYCEV results to date illustrate the versatility of ERYTECH’s encapsulation science in RBCs and its potential for leverage in further partnered developments.

1H 2022 Financial Results

  • Key financial figures for the first half of 2022 compared with the same period of the previous year are summarized below:

In thousands of euros

 

1H 2022
(6 months)

1H 2021
(6 months)

Revenues

 

Other income

 

954

2,270

Net gain on asset sale

 

24,351

Operating income

 

25,304

2,270

Research and development

 

(17,300)

(23,208)

General and administrative

 

(7,911)

(8,027)

Operating expenses

 

(25,211)

(31,235)

Operating income (loss)

 

93

(28,966)

Financial income

 

3,370

2,807

Financial expenses

 

(750)

(1,791)

Financial income (loss)

 

2,620

1,016

Income tax

 

(3,737)

(2)

Net loss

 

(1,024)

(27,952)

  • Net loss for the first half of 2022 was €1.0 million, a €27.0 million improvement over the same period of last year, related mostly to the €24.4 million net gain on the sale of the Princeton facility, while operating expenses of €25.2 million were also showing a €6.0 million decrease (-19%) year-over-year, with a €5.9 million decrease in R&D expenses and a €0.1 million decrease in G&A.

  • Total operating expenses of €25.2 million included an impairment provision of €2.5 million on the Lyon production facility, related to the end of eryaspase operations, and a €1.9 million provision for restructuring, related to the resizing of French operations and staff.

  • Income tax included in 2022 a provision of €3.7 million ($4.1 million), reflecting the best estimate to date of the tax impacts of the capital gain from the sale of the Princeton facility.

  • As of June 30, 2022, ERYTECH had cash and cash equivalents totaling €53.3 million (approximately $55.8 million), compared with €33.7 million as of December 31, 2021. The €19.6 million increase in cash position during the first half of 2022 was the result of the net cash of €37.6 million received from the sale of the Princeton facility, a €20.4 million net cash utilization in operating activities and investing activities (excluding the sale of the Princeton facility) and €2.0 million generated in financing activities, including €3.0 million in pre-funding of the expected 2021 R&D tax credit, while the variation of the U.S. dollar against the euro led to a €0.4 million positive currency exchange impact.

  • The Company has not drawn any tranche on the convertible loan facility (OCABSA) since 2021 and there are no outstanding and unconverted notes. The OCABSA financing line has expired in June 2022.

  • Earlier this year, the company initiated a deep restructuring and cost reduction program, now further intensified with the halt of the BLA process. Considering this ongoing reduction in operating expenses, the Company believes that its current cash position can fund its current programs and planned operating expenses to mid-2024.

Key News Flow and Milestones Expected Over the Next 6 Months

  • Results from the Phase 1 rESPECT Trial of eryaspase in combination with mFOLFIRINOX in first-line pancreatic cancer (2H 2022)

  • Update on partnering discussions (Q4 2022)

First Half 2022 Conference Call Details

ERYTECH management will hold a conference call and webcast on Tuesday, September 13, 2022, at 8:30am ET / 2:30 pm CEST on the business highlights and financial results for the first half 2022. Gil Beyen, CEO, Eric Soyer, CFO/COO, and Iman El-Hariry, CMO, will deliver a brief presentation, followed by a Q&A session.

The audio call is accessible via the below registering link: https://register.vevent.com/register/BI8faf5b5c094c4e48b5ffac460994e65b

Once registered, participants will receive a unique access code and the call number details to join the teleconference.

The webcast can be followed live online via the link:
https://edge.media-server.com/mmc/p/ejb38tvf

In addition, the replay of the webcast will be available for a period of one year on this same link.


Availability of the 2022 Half-Year financial report

The Half-Year financial report as of June 30, 2022 has been made available to the public and filed with the Autorité des Marchés Financiers (AMF).

About ERYTECH

ERYTECH is a clinical-stage biopharmaceutical company developing innovative red blood cell-based therapeutics for severe forms of cancer and orphan diseases. Leveraging its proprietary ERYCAPS® platform, which uses a novel technology to encapsulate drug substances inside red blood cells, ERYTECH is developing a pipeline of product candidates for patients with high unmet medical needs.

ERYTECH produces its product candidates for treatment of patients in Europe at its GMP-approved manufacturing site in Lyon, France, and for patients in the United States through a long-term supply agreement with Catalent, operating from ERYTECH’s former GMP facility in Princeton, New Jersey, USA.

ERYTECH is listed on the Nasdaq Global Select Market in the United States (ticker: ERYP) and on the Euronext regulated market in Paris (ISIN code: FR0011471135, ticker: ERYP). ERYTECH is part of the CAC Healthcare, CAC Pharma & Bio, CAC Mid & Small, CAC All Tradable, EnterNext PEA-PME 150 and Next Biotech indexes.

For more information, please visit www.erytech.com

CONTACTS

 

ERYTECH                     
Eric Soyer
CFO & COO

NewCap
Mathilde Bohin / Louis-Victor Delouvrier
Investor relations
Nicolas Merigeau
Media relations



+33 4 78 74 44 38
investors@erytech.com



+33 1 44 71 94 94
erytech@newcap.eu

 

Forward-looking information

This press release contains forward-looking statements, forecasts and estimates with respect to the clinical results from and the development plans of eryaspase, business and regulatory strategy and anticipated future performance of ERYTECH and of the market in which it operates. Certain of these statements, forecasts and estimates can be recognized by the use of words such as, without limitation, “believes”, “anticipates”, “expects”, “intends”, “plans”, “seeks”, “estimates”, “may”, “will” and “continue” and similar expressions. All statements contained in this press release other than statements of historical facts are forward-looking statements, including, without limitation, statements regarding ERYTECH’s business and regulatory strategy and its evaluation of potential strategic transactions. Such statements, forecasts and estimates are based on various assumptions and assessments of known and unknown risks, uncertainties and other factors, which were deemed reasonable when made but may or may not prove to be correct. Actual events are difficult to predict and may depend upon factors that are beyond ERYTECH's control. Therefore, actual results may turn out to be materially different from the anticipated future results, performance or achievements expressed or implied by such statements, forecasts and estimates. Important factors that could cause actual results and outcomes to differ materially from those indicated in the forward-looking statements include, among others, the following: (1) the failure to achieve certain regulatory and commercial milestones; (2) the inability to maintain the listing of ERYTECH’s shares on the Nasdaq Global Select market and the Euronext regulated market; (3) changes in applicable laws or regulations; (4) the possibility that ERYTECH may be adversely affected by other economic, business and/or competitive factors; (5) the inability to agree to terms on a long-term supply agreement with Catalent; and (6) other risks and uncertainties indicated from time to time in ERYTECH’s regulatory filings. Further description of these risks, uncertainties and other risks can be found in the Company’s regulatory filings with the French Autorité des Marchés Financiers (AMF), the Company’s Securities and Exchange Commission (SEC) filings and reports, including in the Company’s 2021 Universal Registration Document (Document d’Enregistrement Universel) filed with the AMF on April 27, 2022 and in the Company’s Annual Report on Form 20-F filed with the SEC on April 28, 2022 and future filings and reports by the Company. Given these uncertainties, no representations are made as to the accuracy or fairness of such forward-looking statements, forecasts and estimates. Furthermore, forward-looking statements, forecasts and estimates only speak as of the date of this press release. Readers are cautioned not to place undue reliance on any of these forward-looking statements. ERYTECH disclaims any obligation to update any such forward-looking statement, forecast or estimates to reflect any change in ERYTECH’s expectations with regard thereto, or any change in events, conditions or circumstances on which any such statement, forecast or estimate is based, except to the extent required by law.

 

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