Trending: Updated: Database error causes widespread, ongoing Salesforce outage affecting Pardot customers
Juno Therapeutics CEO Hans Bishop. Photo by Dan DeLong for GeekWire
Juno Therapeutics CEO Hans Bishop. Photo by Dan DeLong for GeekWire

Juno Therapeutics, which spun out of Fred Hutchinson Cancer Research Center, Memorial Sloan Kettering Cancer Center, Seattle Children’s Research Institute just three years ago, today issued financial results for the third quarter in which it posted strong revenue gains, and continued losses.

The Seattle biotech company reported revenue of $20.8 million for the quarter, compared to revenue of $1.6 million for the same quarter last year. The boost was largely tied to a partnership agreement with Celgene.

Meanwhile, its cash burn increased to $59.5 million during the quarter, as Juno continued to accumulate losses as it works on experimental cancer therapies and moves toward manufacturing of its drug therapies.

Shares of the company soared 12 percent today, jumping to $28.41.The stock is still down 35 percent so far this year. It went public at $24 per share in December 2014. Reuters reported that a number of biotech and drug company stocks saw their shares rise on Wednesday in the wake of Donald Trump’s historic victory. Investors had worried that federal regulations could have cut drug prices under a Hillary Clinton administration.

It finished the quarter with cash and cash equivalents of $1.04 billion, with CFO Steve Harr said allows for long-term investing in the T-cell technologies its pioneering to attempt to wipe out cancer.

In September, Juno published a study on its immunotherapy treatments for blood cancers, one which showed that the drugs could be more effective and less toxic than other treatments.

You can see the full release here:

Juno Therapeutics, Inc. (NASDAQ: JUNO), a biopharmaceutical company focused on re-engaging the body’s immune system to revolutionize the treatment of cancer, today reported financial results and business highlights for the third quarter 2016.

“JCAR017, a key product candidate of our CD19 platform, has shown encouraging preliminary efficacy and safety results in NHL and pediatric ALL. At the upcoming American Society of Hematology meeting, additional data from our Phase I trial for JCAR017 in NHL patients will be presented,” said Hans Bishop, Juno’s President and Chief Executive Officer. “Progress with CAR T therapy continues as we strive to bring these innovative product candidates to patients battling cancer. We look forward to the upcoming presentations at ASH, including 11 total presentations from a number of ongoing and completed studies.”

Third Quarter 2016 and Recent Corporate Highlights

Clinical Update:

CD19 Portfolio:
Announced seven oral and four poster presentations at the 58th American Society of Hematology (ASH) Annual Meeting, detailing updated clinical and preclinical results generated in partnership with its collaborators. New data with JCAR017 in adult patients with relapsed/refractory (r/r) diffuse large B-cell lymphoma (DLBCL), which is a subtype of non-Hodgkin lymphoma (NHL), data from the PLAT-02 trial for pediatric patients with r/r acute lymphoblastic leukemia (ALL), and data from a Phase I trial with JCAR014 in high-risk, ibrutinib-refractory patients with chronic lymphocytic leukemia (CLL) will be presented.

JCAR015
Announced the removal on July 12, 2016 by the U.S. FDA of a clinical hold that the agency had placed on the Phase II ROCKET trial on July 6, 2016. The ROCKET trial has reopened for enrollment using JCAR015 with cyclophosphamide (cy) preconditioning alone, and all sites are currently treating patients. Juno’s trials and plans for its other CD19-directed CAR T cell product candidates, including JCAR017, were not affected.

JCAR017
Announced Phase I NHL preliminary efficacy and safety data for the ongoing trial. Juno will update results with more patients and durability data at the ASH Annual Meeting.

JCAR014

Researchers at the Fred Hutchinson Cancer Research Center (FHCRC) published clinical data in Science Translational Medicine demonstrating that patients who received a dose of CD19-targeted defined composition engineered T cells after chemotherapy went into complete remission. By controlling the mixture of T cells that patients receive, the researchers can see relationships between cell doses and patient outcomes that were previously elusive. The data also suggest that with a defined one-to-one composition of cells, efficacy of treatment is increased, while toxic side effects are decreased. Like JCAR014, JCAR017 uses a one-to-one ratio of helper and killer CAR T cells, and Juno believes it has the potential to be a “best-in-class” treatment for r/r NHL, r/r CLL, and adult and pediatric r/r ALL.

Corporate Development News:

Juno entered into an exclusive license agreement with Memorial Sloan Kettering Cancer Center (MSK) and Eureka Therapeutics, Inc. for a novel, fully-human binding domain targeting B-cell maturation antigen (BCMA), along with antibodies against two additional undisclosed multiple myeloma targets to be used for the potential development and commercialization of CAR cell therapies for patients with multiple myeloma. MSK and Eureka Therapeutics received an undisclosed upfront payment and are eligible to receive additional payments upon the achievement of undisclosed clinical, regulatory, and commercial milestones, and royalties on net sales. The parties expect the BCMA CAR to enter human testing as early as the first half of 2017.

Juno acquired RedoxTherapies, a privately-held company. The acquisition provides Juno with an exclusive license to vipadenant, a small molecule adenosine A2a receptor antagonist that has the potential to disrupt important immunosuppressive pathways in the tumor microenvironment in certain cancers. Juno intends to explore this molecule in combination with its engineered T cell platform and may over time explore it in other areas as well. The upfront consideration for the RedoxTherapies acquisition was $10.0 million in cash. The seller is also eligible to receive payments upon the achievement of clinical, regulatory, and commercial milestones.

Third Quarter 2016 Financial Results

Cash Position: Cash, cash equivalents, and marketable securities as of September 30, 2016 were $1.04 billion compared to $1.11 billion as of June 30, 2016 and $1.22 billion as of December 31, 2015.

Cash Burn: Excluding cash inflows and outflows from upfront payments related to business development, cash burn in the third quarter of 2016 was $59.5 million including $6.4 million for the purchase of property and equipment, compared to $45.7 million in the third quarter of 2015 including $14.2 million for the purchase of property and equipment. The cash burn increase of $13.8 million was primarily driven by cash outflows in connection with the overall growth of the business, offset by $9.2 million received from Celgene in the third quarter of 2016 for reimbursement of costs incurred by Juno in connection with the CD19 program and by lower spend for property and equipment.

Revenue: Revenue for the three and nine months ended September 30, 2016 was $20.8 million and $58.2 million, respectively, compared to $1.6 million and $14.1 million for the three and nine months ended September 30, 2015, respectively. The increase of $19.2 million and $44.1 million in the three and nine months ended September 30, 2016, respectively, was due primarily to revenue recognized in connection with the Celgene collaboration and CD19 opt-in. Included in revenue for the nine months ended September 30, 2016 and 2015 was $14.3 million and $12.3 million received in connection with the Novartis sublicense agreement, respectively.

R&D Expenses: Research and development expenses for the three and nine months ended September 30, 2016, inclusive of non-cash expenses and computed in accordance with GAAP, were $60.9 million and $206.9 million, respectively, compared to $11.5 million and $129.5 million for the same periods in 2015. The increases in 2016 were primarily due to increased costs incurred to execute Juno’s clinical development strategy, manufacture its product candidates, and expand its overall research and development capabilities, milestones achieved in 2016, an increase in stock-based compensation expense, and the difference between the three months ended September 30, 2016 and 2015 in the gain related to Juno’s estimated success payment liability. These increases were offset by lower upfront payments for technology acquisition in 2016 compared with 2015, a gain recognized during the nine months ended September 30, 2016 related to the change in the estimated value of Juno’s contingent consideration liabilities, and the difference between the nine months ended September 30, 2016 and 2015 in the gain or expense related to Juno’s estimated success payment liability. For the three months ended September 30, 2016 and 2015, Juno recorded a gain of $17.7 million and $25.6 million, respectively, related to Juno’s success payment liability, resulting in an increase in research and development expense of $7.9 million. For the nine months ended September 30, 2016, Juno recorded a gain of $20.8 million related to Juno’s success payment liability, compared to an expense of $17.3 million for the same period in 2015, resulting in a decrease of $38.1 million in research and development expense.

Non-GAAP R&D Expenses: Non-GAAP research and development expenses for the three and nine months ended September 30, 2016 were $62.2 million and $214.5 million, respectively, compared to $34.5 million and $75.4 million for the same periods in 2015. Non-GAAP research and development expenses for the three and nine months ended September 30, 2016 include $7.9 million and $25.8 million of stock-based compensation expense, respectively, compared to $3.1 million and $7.3 million for the same periods in 2015. Non-GAAP research and development expenses in 2016 exclude the following:

A gain of $17.7 million and $20.8 million for the three and nine months ended September 30, 2016, respectively, associated with the change in the estimated fair value and elapsed service period for Juno’s potential success payment liabilities to FHCRC and MSK.

Non-cash stock-based compensation expense of $0.9 million and $3.3 million for the three and nine months ended September 30, 2016, respectively, related to a 2013 restricted stock award to a co-founding director that became a consultant upon his departure from Juno’s board of directors in 2014.
An expense of $0.3 million for the three months ended September 30, 2016 and a gain of $5.2 million for the nine months ended September 30, 2016 associated with the change in the estimated fair value of the contingent consideration liabilities recorded in connection with the Stage and X-Body acquisitions.

Upfront payments related to technology licensing and the RedoxTherapies acquisition of $15.0 million for the three and nine months ended September 30, 2016.

Non-GAAP research and development expenses in 2015 exclude the following:
A gain of $25.6 million for the three months ended September 30, 2015 and expense of $17.3 million for the nine months ended September 30, 2015 associated with the change in estimated fair value and elapsed accrual period for Juno’s potential success payment liabilities to FHCRC and MSK.
Non-cash stock-based compensation expense of $1.3 million and $4.8 million for the three and nine months ended September 30, 2015, respectively, related to a 2013 restricted stock award to a co-founding director that became a consultant upon his departure from Juno’s board of directors in 2014. An expense of $1.3 million and $1.2 million for the three and nine months ended September 30, 2015, respectively, associated with the change in the estimated fair value of the contingent consideration liabilities recorded in connection with the Stage and X-Body acquisitions.
Upfront payments related to license agreements of $30.8 million for the nine months ended September 30, 2015 associated with the Editas and Fate Therapeutics collaborations.
G&A Expenses: General and administrative expenses on a GAAP basis for the three and nine months ended September 30, 2016 were $18.4 million and $51.2 million, respectively, compared to $13.6 million and $41.2 million for the same periods in 2015. The increase in the third quarter of 2016 compared to the same period in 2015 was primarily due to an increase in litigation and patent legal costs, consulting costs related to commercial readiness, and personnel costs, including non-cash stock-based compensation expense. These were offset by a decrease in costs supporting business development activities. The increase in the nine months ended September 30, 2016 compared to the same period in 2015 was primarily due to increased personnel costs, including non-cash stock-based compensation expense and consulting costs related to commercial readiness, offset by lower costs supporting business development activities and lower litigation costs. General and administrative expenses include $5.4 million and $15.9 million of non-cash stock-based compensation expense for the three and nine months ended September 30, 2016, respectively, compared to $4.7 million and $9.4 million for the same periods in 2015.

GAAP Net Loss: Net loss for the three and nine months ended September 30, 2016 was $56.9 million, or $0.56 per share, and $192.8 million, or $1.91 per share, respectively, compared to $23.2 million, or $0.26 per share and $154.2 million, or $1.80 per share for the same periods in 2015.

Non-GAAP Net Loss: Non-GAAP net loss, which incorporates the non-GAAP R&D expense, for the three and nine months ended September 30, 2016 was $58.3 million, or $0.57 per share, and $200.4 million, or $1.99 per share, respectively, compared to $46.3 million, or $0.52 per share, and $100.0 million, or $1.17 per share, respectively, for the same periods in 2015.
A reconciliation of GAAP net loss to non-GAAP net loss is presented below under “Non-GAAP Financial Measures.”

2016 Financial Guidance Reaffirmed

Juno reaffirms 2016 cash burn guidance, excluding cash inflows or outflows from upfront payments related to business development activities, of between $220 million and $250 million.
Operating burn estimated to be between $170 million and $195 million.

Capital expenditures estimated to be between $40 million and $55 million, the vast majority of which are related to one-time infrastructure build-outs.

Conference Call Information

Juno will host a conference call today to review Juno’s financial results for the third quarter 2016 beginning at 2:00 p.m. Pacific Time (PT)/5:00 p.m. Eastern Time (ET). Analysts and investors can participate in the conference call by dialing (855) 780-7198 for domestic callers and (631) 485-4870 for international callers, using the conference ID# 7555725.
The webcast can be accessed live on the Investor Relations page of Juno’s website, www.JunoTherapeutics.com, and will be available for replay for 30 days following the call.

About Juno
Juno Therapeutics is building a fully integrated biopharmaceutical company focused on re-engaging the body’s immune system to revolutionize the treatment of cancer. Founded on the vision that the use of human cells as therapeutic entities will drive one of the next important phases in medicine, Juno is developing cell-based cancer immunotherapies based on chimeric antigen receptor and high-affinity T cell receptor technologies to genetically engineer T cells to recognize and kill cancer. Juno is developing multiple cell-based product candidates to treat a variety of B-cell malignancies as well as solid tumors. Several product candidates have shown compelling clinical responses in clinical trials in refractory leukemia and lymphoma conducted to date. Juno’s long-term aim is to leverage its cell-based platform to develop new product candidates that address a broader range of cancers and human diseases. Juno brings together innovative technologies from some of the world’s leading research institutions, including the Fred Hutchinson Cancer Research Center, Memorial Sloan Kettering Cancer Center, Seattle Children’s Research Institute, the University of California, San Francisco, and The National Cancer Institute. Juno Therapeutics has an exclusive license to the St. Jude Children’s Research Hospital patented technology for CD19-directed product candidates that use 4-1BB, which was developed by Dario Campana, Chihaya Imai, and St. Jude Children’s Research Hospital.

Like what you're reading? Subscribe to GeekWire's free newsletters to catch every headline

Comments

Job Listings on GeekWork

Find more jobs on GeekWork. Employers, post a job here.