UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On February 27, 2024, Alector, Inc. (the “Company”) announced its financial results for the quarter ended December 31, 2023. A press release announcing these results, which is attached hereto as Exhibit 99.1, is incorporated herein by reference.
All of the information furnished in Item 2.02 and Item 9.01 (including Exhibit 99.1) shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. |
Description |
99.1 |
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104 |
Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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ALECTOR, INC. |
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Date: |
February 27, 2024 |
By: |
/s/ Arnon Rosenthal |
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Arnon Rosenthal, Ph.D. |
Exhibit 99.1
Alector Reports Fourth Quarter and Full Year 2023 Financial Results
and Provides Business Update
Data from INVOKE-2, evaluating the most advanced TREM2 candidate in clinical development for early Alzheimer’s disease (AD), expected in Q4 2024; trial enrollment completed in Q3 2023
First participant in the global PROGRESS-AD Phase 2 clinical trial of AL101 in early AD dosed in Q1 2024
Latozinemab granted FDA’s Breakthrough Therapy Designation for frontotemporal dementia due to a mutation in the progranulin gene (FTD-GRN)
Achieved target enrollment in pivotal INFRONT-3 latozinemab Phase 3 trial in FTD-GRN during Q4 2023
$620.0 million in cash, cash equivalents and investments after January 2024 equity offering anticipated to provide runway through 2026
Management to host conference call and webcast today at 4:30 p.m. ET/1:30 p.m. PT
South San Francisco, Calif., February 27, 2024 -- Alector, Inc. (Nasdaq: ALEC), a clinical-stage biotechnology company pioneering immuno-neurology, today reported fourth quarter and full year 2023 financial results and recent portfolio and business updates. As of December 31, 2023, Alector’s cash, cash equivalents and investments totaled $548.9 million. Pro forma for Alector’s January 2024 equity offering, cash, cash equivalents and investments total $620.0 million, which the company anticipates will provide runway through 2026.
“2023 was marked by continued progress on the execution of our late-stage clinical programs, highlighted by achieving target enrollment in both the INVOKE-2 Phase 2 trial of AL002 and the pivotal INFRONT-3 Phase 3 trial of latozinemab. Additionally, the FDA granted Breakthrough Therapy Designation to latozinemab for FTD-GRN, and we look forward to continued productive engagements with the FDA, recognizing the unmet need for people living with the condition. We are also pleased to report that the first patient has been dosed in the PROGRESS-AD Phase 2 trial of AL101/GSK4527226,” said Arnon Rosenthal, Ph.D., Chief Executive Officer of Alector. “Alector continues to be a pioneer in the field of immuno-neurology, and we are beginning the year with an advanced pipeline and an extended cash runway through 2026, approximately a full year beyond the expected FTD-GRN pivotal Phase 3 INFRONT-3 data readout. Our unwavering commitment to addressing neurodegeneration fuels progress across our clinical-stage programs,
with an anticipated data readout from the INVOKE-2 Phase 2 trial of AL002 in the fourth quarter of this year.”
Sara Kenkare-Mitra, Ph.D., President and Head of Research and Development at Alector added, “We also made meaningful strides in our Alector Brain Carrier platform, which is our proprietary blood brain barrier technology. We intend to leverage this platform technology selectively across our portfolio to increase exposure to the central nervous system by enhancing transport across the blood brain barrier. Moreover, we remain committed to the development of our early programs with additional targets in Alzheimer’s disease, amyotrophic lateral sclerosis, and Parkinson’s disease, which could position us to further expand our portfolio of transformative investigational therapies and achieve our ambitious vision of making brain disorders history.”
Cash Runway Extension Through 2026
With $620.0 million in cash, cash equivalents and investments pro forma for the January 2024 equity offering, Alector has extended its cash runway through 2026, approximately a full year beyond the expected data readout for the pivotal Phase 3 INFRONT-3 clinical trial of latozinemab in participants with frontotemporal dementia due to a mutation in the progranulin gene (FTD-GRN). The extended cash runway also allows the company to selectively accelerate investment in its novel, first-in-class proprietary portfolio.
Recent Clinical Updates
Immuno-Neurology Portfolio
Progranulin Programs (AL101/GSK4527226 and latozinemab (AL001)) Being Developed in Collaboration with GSK
TREM2 Program (AL002) Being Developed in Collaboration with AbbVie
Early Research Pipeline
Corporate
Fourth Quarter 2023 Financial Results
Revenue. Collaboration revenue for the quarter ended December 31, 2023, was $15.2 million, compared to $14.4 million for the same period in 2022. Collaboration revenue for the year ended December 31, 2023, was $97.1 million, compared to $133.6 million for the same period in 2022. The decrease in year-over-year collaborative revenue was primarily due to revenue recognized from the termination of the AL003 program in 2022, offset by higher revenue recognized for the AL101 programs, including a non-cash revenue adjustment due to contract modification to have GSK operationalize the AL101 Phase 2 study and higher revenue recognized for the AL002 program due to the addition of AL002 LTE and patient replacement revenue in 2023.
R&D Expenses. Total research and development expenses for the quarter ended December 31, 2023, were $47.7 million, compared to $54.5 million for the quarter ended December 31, 2022. Total research and development expenses for the year ended December 31, 2023, were $192.1 million compared to $210.4 million for the same period in 2022. The decrease in year-over-year R&D expenses was mainly driven by the Company’s strategy to prioritize late-stage programs.
G&A Expenses. Total general and administrative expenses for the quarter ended December 31, 2023, were $14.9 million, compared to $15.4 million for the quarter ended December 31, 2022. Total general and administrative expenses for the year ended December 31, 2023, were $56.7 million compared to $61.0 million for the year ended December 31, 2022. The decrease in year-over-year G&A expenses is primarily due to the decrease in consulting expenses related to accounting, recruiting, IT, and other general expenses, plus a decrease in insurance costs.
Net Loss. For the quarter ended December 31, 2023, Alector reported a net loss of $41.4 million, or $0.49 per share, compared to a net loss of $52.4 million, or $0.63 net loss per share, for the same period in 2022. For the year ended December 31, 2023, Alector reported a net loss of $130.4
million or $1.56 net loss per share, compared to a net loss of $133.3 million or $1.62 net loss per share, for the same period in 2022.
Cash Position. Cash, cash equivalents, and investments were $548.9 million as of December 31, 2023. In January 2024, Alector further strengthened its balance sheet with the completion of a follow-on financing issuing 10,869,566 shares of its common stock for total gross proceeds of $75 million before deducting underwriting discounts and commissions and estimated offering expenses. Management expects that this will be sufficient to fund current operations through 2026.
2024 Guidance. Management anticipates, for the year ending 2024, collaboration revenue to be between $60 million and $70 million, total research and development expenses to be between $210 million and $230 million, and total general and administrative expenses to be between $60 million and $70 million.
Fourth Quarter and Full Year 2023 Conference Call
Alector’s management team will host a conference call discussing Alector’s results for the fourth quarter and full year 2023 and provide a business update. The conference call will be webcast and accessible via the investor relations section of Alector’s website at www.alector.com.
To access the call, please use the following information:
Date: Tuesday, February 27, 2024
Time: 4:30 p.m. ET, 1:30 p.m. PT
The event will be webcast live under the investor relations section of Alector’s website at https://investors.alector.com/events-and-presentations/events and following the event a replay will be archived there for 30 days. Interested parties participating by phone will need to register using this online form. After registering for dial-in details, all phone participants will receive an auto-generated e-mail containing a link to the dial-in number along with a personal PIN number to use to access the event by phone.
About Alector
Alector is a clinical-stage biotechnology company pioneering immuno-neurology, a novel therapeutic approach for the treatment of neurodegenerative diseases. Immuno-neurology targets immune dysfunction as a root cause of multiple pathologies that are drivers of degenerative brain disorders. Alector has discovered and is developing a broad portfolio of innate immune system programs, designed to functionally repair genetic mutations that cause dysfunction of the brain’s immune system and enable rejuvenated immune cells to counteract emerging brain pathologies. Alector’s immuno-neurology product candidates are supported by biomarkers and seek to treat
indications, including Alzheimer’s disease and genetically defined frontotemporal dementia patient populations. Alector is headquartered in South San Francisco, California. For additional information, please visit www.alector.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this press release include, but are not limited to, statements regarding our business plans, business strategy, product candidates, planned and ongoing preclinical studies and clinical trials, expected milestones, expectations of our collaborations, and financial and cash guidance. Such statements are subject to numerous risks and uncertainties, including but not limited to risks and uncertainties as set forth in Alector’s Annual Report on Form 10-K for 2023, filed with the Securities and Exchange Commission (“SEC”), as well as the other documents Alector files from time to time with the SEC. These documents contain and identify important factors that could cause the actual results for Alector to differ materially from those contained in Alector’s forward-looking statements. Any forward-looking statements contained in this press release speak only as of the date hereof, and Alector specifically disclaims any obligation to update any forward-looking statement, except as required by law.
Selected Consolidated Balance Sheet Data
(in thousands)
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December 31, |
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December 31, |
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2023 |
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2022 |
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Cash, cash equivalents, and marketable securities |
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$ |
548,8611 |
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$ |
712,851 |
Total assets |
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621,827 |
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787,648 |
Total current liabilities (excluding deferred revenue) |
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94,973 |
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45,578 |
Deferred revenue (including current portion) |
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293,820 |
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491,601 |
Total liabilities |
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487,669 |
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573,206 |
Total stockholders’ equity |
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134,158 |
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214,442 |
Consolidated Statement of Operations Data
(in thousands, except share and per share data)
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Three Months Ended |
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Twelve Months Ended |
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2023 |
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2022 |
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2023 |
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2022 |
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Collaboration revenue |
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$ |
15,190 |
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$ |
14,440 |
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$ |
97,062 |
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$ |
133,617 |
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Operating expenses: |
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Research and development |
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47,723 |
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54,493 |
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192,115 |
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210,418 |
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General and administrative |
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14,920 |
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15,385 |
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56,687 |
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61,033 |
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Total operating expenses |
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62,643 |
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69,878 |
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248,802 |
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271,451 |
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Loss from operations |
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(47,453) |
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(55,438) |
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(151.740) |
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(137,834) |
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Other income, net |
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7,685 |
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3,731 |
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26,561 |
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7,778 |
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Net loss before income tax |
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(39,768) |
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(51,707) |
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(125,179) |
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(130,056) |
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Income tax expense |
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1,666 |
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721 |
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5,212 |
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3,254 |
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Net loss |
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$ |
(41,434) |
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$ |
(52,428) |
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$ |
(130,391) |
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$ |
(133,310) |
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Net loss per share, basic and diluted |
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$ |
(0.49) |
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$ |
(0.63) |
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$ |
(1.56) |
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$ |
(1.62) |
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Shares used in computing net loss per share basic and diluted |
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84,384,151 |
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82,763,688 |
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83,733,730 |
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82,467,587 |
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REFERENCES
1. U.S. Food and Drug Administration (FDA). Breakthrough Therapy.
Alector Contacts:
Alector
Katie Hogan
202-549-0557
katie.hogan@alector.com
1AB (media)
Dan Budwick
973-271-6085
dan@1abmedia.com
Argot Partners (investors)
Laura Perry
212.600.1902
alector@argotpartners.com