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 August 3, 2023, Alector, Inc. (the “Company”) announced its financial results for the quarter ended June 30, 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: |
August 3, 2023 |
By: |
/s/ Arnon Rosenthal |
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Arnon Rosenthal, Ph.D. |
Exhibit 99.1
Alector Reports Second Quarter 2023 Financial Results and Provides Business Update
Closed screening in the INVOKE-2 Phase 2 trial of AL002 in participants with early Alzheimer’s disease; completing enrollment in Q3 2023, with data readout expected in Q4 2024
Presented update on INVOKE-2 at the Alzheimer’s Association International Conference (AAIC)
Anticipate completing enrollment in pivotal INFRONT-3 trial of latozinemab with symptomatic FTD-GRN participants in Q4 2023 based on recent interactions with the FDA and EMA
$630.0 million in cash, cash equivalents and investments provide runway through 2025;
revenue and expense guidance updated for 2023
Management to host conference call and webcast today at 4:30 p.m. ET / 1:30 p.m. PT
South San Francisco, Calif., August 3, 2023 -- Alector, Inc. (Nasdaq: ALEC), a clinical-stage biotechnology company pioneering immuno-neurology, today reported second quarter 2023 financial results and recent portfolio and business updates. As of June 30, 2023, Alector’s cash, cash equivalents and investments totaled $630.0 million.
“We expect to complete enrollment in the INVOKE-2 Phase 2 clinical trial of AL002 in early Alzheimer’s disease in the third quarter,” said Arnon Rosenthal, Ph.D., Chief Executive Officer of Alector. “We have received positive feedback from the FDA and the EMA to conduct a primary analysis on approximately 90-100 symptomatic participants in our pivotal INFRONT-3 Phase 3 clinical trial of latozinemab in FTD-GRN. We anticipate completing enrollment in INFRONT-3 in the fourth quarter of this year.”
Sara Kenkare-Mitra, Ph.D., President and Head of Research and Development at Alector added, “While we continue to progress our late-stage clinical programs, we are also strategically advancing our innovative research portfolio to fuel our pipeline. I am particularly excited about the ongoing development of our blood brain barrier technology and the progress on our preclinical program targeting GPNMB for the treatment of Parkinson’s disease.”
Recent Clinical Updates
Immuno-Neurology Portfolio
TREM2 Program (AL002) Being Developed in Collaboration with AbbVie
Alector Reports Second Quarter 2023 Financial Results
Page 2
Progranulin Programs (latozinemab (AL001) and AL101/ GSK4527226) Being Developed in Collaboration with GSK
Alector Reports Second Quarter 2023 Financial Results
Page 3
Early Research Pipeline
Recent Corporate Updates
Second Quarter 2023 Financial Results
Revenue. Collaboration revenue for the quarter ended June 30, 2023, was $56.2 million, compared to $79.9 million for the same period in 2022. The $23.6 million decrease was mainly due to $68.9 million of collaboration revenue recognized in the second quarter of 2022 due to changes in estimated costs to satisfy the performance obligations resulting from the termination of the AL003 program and a $16.7 million decrease in revenue recognized for the latozinemab programs. This was offset by a $33.5 million increase in revenue recognized for the AL101 programs, including a cumulative non-cash revenue adjustment due to contract modification to have GSK operationalize the AL101 Phase 2 trial, and a $28.5 million increase to collaboration revenue for the AL002 program due to changes in total expected costs and the addition of AL002 LTE and patient replacement revenue in 2023.
R&D Expenses. Total research and development expenses for the quarter ended June 30, 2023, were $46.2 million, compared to $54.5 million for the quarter ended June 30, 2022. The decrease of $8.4 million was mainly due to the Company’s strategy to prioritize late-stage programs and higher cost share amounts with GSK that are recorded as contra expense.
G&A Expenses. Total general and administrative expenses for the quarter ended June 30, 2023, were $13.6 million, compared to $15.8 million for the same period in 2022. The decrease of $2.2 million was primarily due to a decrease in consulting expenses related to accounting, recruiting, IT, and other general expenses.
Net Income. For the quarter ended June 30, 2023, Alector reported a net income of $1.4 million, or $0.02 net income per share, compared to a net income of $9.9 million, or $0.12 net income per share, for the same period in 2022.
Alector Reports Second Quarter 2023 Financial Results
Page 4
Cash Position. Cash, cash equivalents, and investments were $630.0 million as of June 30, 2023. Management continues to expect that this will be sufficient to fund current operations through 2025.
2023 Guidance. Management is revising guidance for the year ending 2023, increasing collaboration revenue to now be between $90 million and $100 million, decreasing total research and development expenses to now be between $210 million and $220 million and tightening expectations for total general and administrative expenses to now be between $60 million and $65 million.
Second Quarter 2023 Conference Call
Alector’s management team will host a conference call discussing Alector’s results for the second quarter of 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: Thursday, August 3, 2023
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.
Alector Reports Second Quarter 2023 Financial Results
Page 5
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 target genetically defined patient populations in frontotemporal dementia and Alzheimer’s disease. 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 and the timing of enrollment in and data readouts from such trials, expected milestones, including the proposed timing on engagement with regulatory authorities for certain product candidates, 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 Quarterly Report on Form 10-Q filed on August 3, 2023 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.
Alector Reports Second Quarter 2023 Financial Results
Page 6
Selected Consolidated Balance Sheet Data
(in thousands)
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June 30, |
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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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$ |
630,048 |
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$ |
712,851 |
Total assets |
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708,737 |
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787,648 |
Total current liabilities (excluding deferred revenue) |
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63,720 |
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45,578 |
Deferred revenue (including current portion) |
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313,893 |
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491,601 |
Total liabilities |
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512,431 |
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573,206 |
Total stockholders’ equity |
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196,306 |
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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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Six 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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$ |
56,214 |
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$ |
79,851 |
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$ |
72,763 |
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$ |
104,325 |
Operating expense: |
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Research and development |
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46,177 |
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54,534 |
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98,064 |
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107,577 |
General and administrative |
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13,626 |
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15,842 |
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28,403 |
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31,396 |
Total operating expenses |
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59,803 |
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70,376 |
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126,467 |
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138,973 |
Income (loss) from operations |
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(3,589) |
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9,475 |
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(53,704 |
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(34,648) |
Other income, net |
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6,357 |
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1,450 |
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11,516 |
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1,714 |
Net income (loss) before income tax |
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2,768 |
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10,925 |
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(42,188 |
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(32,934) |
Income tax expense |
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1,393 |
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1,042 |
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2,294 |
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1,800 |
Net income (loss) |
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$ |
1,375 |
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$ |
9,883 |
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$ |
(44,482 |
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$ |
(34,734) |
Net income (loss) per share: |
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Basic net income (loss) per share |
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$ |
0.02 |
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$ |
0.12 |
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$ |
(0.53 |
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$ |
(0.42) |
Diluted net income (loss) per share |
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$ |
0.02 |
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$ |
0.12 |
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$ |
(0.53 |
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$ |
(0.42) |
Weighted-average shares used in calculating: |
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Basic net income (loss) per share |
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83,497,125 |
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82,394,784 |
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83,186,052 |
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82,248,880 |
Diluted net income (loss) per share |
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83,566,293 |
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82,588,368 |
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83,186,052 |
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82,248,880 |
Alector Reports Second Quarter 2023 Financial Results
Page 7
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