Lysogene Reports First Half 2022 Financial Results

·8 min read
  • Full data analysis of AAVance Phase 2/3 Gene Therapy Clinical Trial with LYS-SAF302 in MPS IIIA expected early Q4 2022

  • Completion of Phase 1 adaptive clinical trial evaluating safety of LYS-GM101 in 5 patients with GM1 gangliosidosis

  • Cash position of €7.7m at the end of June 2022, providing financial visibility to the end of January 2023

PARIS, September 23, 2022--(BUSINESS WIRE)--Regulatory News:

Lysogene (FR0013233475 – LYS) (Paris:LYS), a phase 3 gene therapy platform Company targeting central nervous system (CNS) diseases, today reports its first half 2022 financial results, approved by the Board of Directors on 23 September 2022. The financial statements were subject to a limited review by the Company’s statutory auditors. The full interim financial report is available on the Company’s website in the Investors’ section.

Karen Aiach, Founder, Chairman and Chief Executive Officer of Lysogene, said: "We are finally reaching the most exciting time in Lysogene's journey as results of our lead gene therapy candidate, LYS-SAF302, are expected in the next few weeks. The data set is currently being analyzed by independent data providers and we look forward to having a comprehensive view of the efficacy of our drug candidate to hopefully confirm the preliminary positive efficacy signal observed so far. With these results, we will be able to discuss the next steps with the regulatory authorities." Karen Aiach added: "We also continue to work on strategic options to extend the Company's cash runway to fund the development of our extensive pipeline of preclinical programs targeting high prevalence diseases".

Selected financial information on 30 June 2022 (IFRS financial statements)

Comprehensive Income Statement

in thousands of euros

30/06/2022

30/06/2021

Operating income

-

Revenue

8,439

2,922

-

Other operating revenue

1,603

1,305

Total operating income

10,042

4,227

Operating expenses

-

Research and Development expenses

(6,512)

(6,859)

-

General and Administrative expenses

(2,625)

(2,566)

Total operating expenses

(9,137)

(9,425)

Operating income

905

(5,198)

Net financial income (expense)

(202)

(333)

Net income (loss)

703

(5,531)

Weighted average number of shares outstanding

17,385,028

16,794,212

Earnings per share (€)

0.04

(0.33)

Number of shares outstanding as of 30 June 2022: 17,811,140

Cash position at January 01

12,336

18,780

Change in net cash

(4,616)

(3,710)

Cash position at June 30

7,720

15,070

In the first half 2022, total operating income reached €10.0 million versus €4.2 million in 2021 with:

  • Revenue of €8.4 million versus €2.9 million in 2021. Until December 31, 2021, the payments made by Sarepta under the license-collaboration agreement were recorded in proportion to the direct internal and external costs associated with the development of LYS-SAF302 in accordance with IFRS 15.

As a result of the termination of the agreement notified on January 11, 2022, the Company fully recognized in the first half of 2022 all outstanding payments from Sarepta for an amount of €8.4 million.

  • Other operating revenue of €1.6 million and consisted mainly of the Research Tax Credit.

Operating expenses amounted to €9.1 million in the first half 2022 compared to €9.4 million in 2021 with:

  • Research and Development expenses of €6.5 million, down €0.3 million versus 2021 mainly due to:

    • a decrease in personnel expenses related to the variation in headcount over the period and to a lesser impact of free share plans,

    • external expenses almost stable over the period with an increase in expenses related to the production campaign of LYS-GM101 clinical batches, offset by a decrease in expenses related to litigation as the Company recorded in 2021 a $2.8 million impact of the settlement of a commercial dispute with an industrial partner.

  • General and Administrative expenses of €2.6 million, slightly up versus 2021 with:

    • an increase in external costs, notably associated with legal fees related to the structuring of financings,

    • partly offset by a decrease in personnel expenses due to the variation in headcount over the period and a lesser impact of free share plans.

Net financial result was negative by €0.2 million consisting of fees and accrued interest on the loans granted to the Company at the end of 2021 and beginning of 2022.

The net profit for the period was €0.7 million versus a net loss of €5.5 million in 2021.

At 30 June 2022, the Company’s cash position amounted to €7.7 million. Based on projected cash runway, it would allow the Company to finance its operations until the end of January 2023.

To extend its cash runway, the Company has already initiated discussions to explore all possible strategic options. It is currently evaluating the following options: (i) a capital increase (private placement, public offering, equity lines or other equity instruments); (ii) a financing by debt (bond issuing, repayable advance or venture loan); (iii) a license grant on one or several of its products to benefit from the upfront and milestones payments related to such collaboration.

Nevertheless, among all possible options, the Company today prioritizes a non-dilutive one under the form of a license collaboration on one or several of its products. Given the low market capitalization currently, potential equity fundings would be deemed highly dilutive. Financing by debt is the least likely solution at this stage given that the Company has already subscribed to several debt instruments in the past 18 months for an amount of €11.9m from the European Investment Bank, The Public Investment Bank and the Bred (cf note 10 of the financial statements).

In addition, the Company will maintain its cost control initiatives initiated at the beginning of the year. To cover the expenses already incurred and overhead costs until 30 September 2023, the Company estimates that it will need an additional €8 million funding (which could be reduced by €3.2 million from the reimbursement of the 2022 Research Tax Credit). This amount assumes that no new R&D expenses will be incurred from February 2023.

Clinical update

LYS-SAF302 program

In the first half of 2022, the Company published initial efficacy data from the AAVance Phase 2/3 clinical trial evaluating LYS-SAF302 in patients with MPS IIIA.

The positive effect of LYS-SAF302 on the MPS IIIA disease biomarker heparan sulfate in the cerebrospinal fluid was confirmed with statistically significant decreases of about 20% in average levels of total HS-derived oligosaccharides in the CSF relative to baseline levels. Moreover, the drug candidate appeared to have a positive effect on the development of the youngest patients. In the 6 patients treated at less than 31 months, stable or continuously increasing cognitive, language and motor functions was observed, including subjects with SGSH mutations associated with the severe disease phenotype.

Full study results are expected early Q4 2022, along with results from the PROVide patient reported outcome videos study. Based on this comprehensive clinical data package, the company plans to initiate discussions with regulatory authorities in the US and in Europe to determine next steps.

LYS-GM101 program

In the first half of 2022, the Company completed recruitment of its Phase 1 adaptive clinical trial with its investigation gene therapy LYS-GM101 in GM1 gangliosidosis which is designed to evaluate the safety of the drug candidate.

All five patients treated in this initial phase will be monitored and, depending on the results, the next phase of the study should be launched early next year with the recruitment of 12 additional patients.

About Lysogene

Lysogene is a gene therapy Company focused on the treatment of orphan diseases of the central nervous system (CNS). The Company has built a unique capability to enable delivery of gene therapies to the CNS to treat lysosomal diseases and other disorders of the CNS. A phase 2/3 clinical trial in MPS IIIA is ongoing. An adaptive clinical trial in GM1 gangliosidosis is also ongoing. Lysogene is also developing an innovative AAV gene therapy approach for the treatment of Fragile X syndrome, a genetic disease related to autism. The Company also entered into an exclusive worldwide license agreement with Yeda, the commercial arm of the Weizmann Institute of Science, for a novel gene therapy candidate for Parkinson disease with GBA1 mutations. www.lysogene.com.

Forward Looking Statement

This press release may contain certain forward-looking statements, especially on the Company’s progress of its clinical trials and cash runway. Although the Company believes its expectations are based on reasonable assumptions, all statements other than statements of historical fact included in this press release about future events are subject to (i) change without notice, (ii) factors beyond the Company’s control, (iii) clinical trial results, (iv) increased manufacturing costs, (v) potential claims on its products. These statements may include, without limitation, any statements preceded by, followed by or including words such as "target," "believe," "expect," "aim," "intend," "may," "anticipate," "estimate," "plan," "objective", "project," "will," "can have," "likely," "should," "would," "could" and other words and terms of similar meaning or the negative thereof. Forward-looking statements are subject to inherent risks and uncertainties beyond the Company’s control that could cause the Company’s actual results, performance or achievements to be materially different from the expected results, performance or achievements expressed or implied by such forward-looking statements. A further list and description of these risks, uncertainties and other risks can be found in the Company’s regulatory filings with the French Autorité des Marchés Financiers, including in the 2021 universal registration document, registered with the French Markets Authorities on April 19, 2022, and future filings and reports by the Company. Furthermore, these forward-looking statements are only as of the date of this press release. Readers are cautioned not to place undue reliance on these forward-looking statements. Except as required by law, the Company assumes no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future. If the Company updates one or more forward-looking statements, no inference should be drawn that it will or will not make additional updates with respect to those or other forward-looking statements.

This press release has been prepared in both French and English. In the event of any differences between the two texts, the French language version shall supersede.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220923005458/en/

Contacts

Stéphane Durant des Aulnois
Chief Financial Officer
stephane.durant-des-aulnois@lysogene.com
+ 33 1 41 43 03 99