PureTech Health plc - Half-Year Report
Strong regulatory, clinical and financial momentum across the Founded Entities and Wholly Owned Pipeline, including three regulatory approvals and three clinical readouts, validate PureTech's model and support future growth
PureTech generated cash of over $245 million in the first half of 2020 and approximately $101 million in August 2020 (post-period) from sales of equity in Founded Entities
Founded Entities are well-capitalised, having raised over $890 million since July 2018, $136.5 million of which was from the first six months of 2020
Strong cash position of $310.5 million as of 30 June 2020 on a parent company level projected to fund Wholly Owned Pipeline and operations into the first quarter of 2024, prior to receipt of approximately $101 million in August 2020
Company to host a webcast and conference call today at 9.00 EDT / 14.00 BST
PureTech Health plc (LSE: PRTC) ("PureTech Health," "PureTech," or "the Company"), today announces its half-yearly results for the six months ended 30 June 2020.
PureTech, which is comprised of PureTech and its Founded Entities1 (together, "the Group"), is a clinical-stage biotherapeutics company dedicated to discovering, developing and commercialising highly differentiated medicines for devastating diseases, including intractable cancers, lymphatic and gastrointestinal diseases, central nervous system disorders and inflammatory and immunological diseases, among others. The Company has created an extensive pipeline through the expertise of its experienced research and development team and its extensive network of scientists, clinicians and industry leaders. This pipeline, which is being advanced both internally and through PureTech's Founded Entities, is comprised of 24 products and product candidates, including two that have received US Food and Drug Administration (FDA) clearance and European marketing authorisation. The PureTech pipeline includes innovative platforms and therapeutic candidates that were developed in collaboration with some of the world's leading experts. All of the underlying programmes and platforms that resulted in this pipeline of products and product candidates were initially identified or discovered and then advanced by the PureTech team through key validation points based on the Company's insights into the biology of the brain, immune and gut, or BIG, systems and the interface between those systems, referred to as the BIG Axis.
1) Unless the context specifically indicates otherwise, references in this report to "Founded Entities" refer to the entities that PureTech founded and in which PureTech continues to hold equity. While PureTech maintains ownership of equity interests in its Founded Entities, the Company does not, in all cases, maintain control over these entities (by virtue of (i) majority voting control and (ii) the right to elect representation to the entities' board of directors) or direct the management and development efforts for these entities. Consequently, not all such entities are consolidated in the financial statements. Where PureTech maintains control, the entity is referred to as a Controlled Founded Entity in this report and is consolidated in the financial statements. Where PureTech does not maintain control, the entity is referred to as a Non-Controlled Founded Entity in this report and is not consolidated in the financial statements. As of 30 June 2020, Controlled Founded Entities include Alivio Therapeutics, Inc., Follica, Incorporated, Entrega, Inc., Vedanta Biosciences, Inc. and Sonde Health, Inc., and Non-Controlled Founded Entities include Akili Interactive Labs, Inc., Gelesis, Inc., Karuna Therapeutics, Inc., and Vor Biopharma Inc.
Webcast and conference call details
Members of the PureTech management team will host a conference call at 9.00 EDT / 14.00 BST today, 27 August, to discuss these results. A live webcast and presentation slides will be available on the investors section of PureTech's website under the Reports and Presentations tab. To join the conference call please dial:
United Kingdom: 0800 640 6441
United Kingdom (Local): 020 3936 2999
United States: 1 855 9796 654
United States (Local): 1 646 664 1960
All other locations: +44 20 3936 2999
Access code: 380513
Participants should log on approximately 10 minutes in advance to download slides and ensure proper setup to receive the webcast. For those unable to listen to the call live, a replay will be available on the PureTech website.
Wholly Owned Pipeline
PureTech's team, network and expertise in the BIG Axis has enabled the Company to continue to advance and strengthen its Wholly Owned Pipeline2, an important driver of PureTech's potential future growth. Focused on the lymphatic system and related immunological disorders, this pipeline includes one clinical-stage product candidate for the potential treatment of a range of conditions involving fibrosis, inflammation and impaired lymphatic flow (LYT-100; deupirfenidone), two preclinical product candidates for intractable cancers (LYT-200; targeting galectin-9 and LYT-210 targeting; gamma-delta1 T cells) and three discovery platforms, the most advanced of which has generated a product candidate for a range of neurological conditions (LYT-300; oral allopregnanolone).
Key developments and progress during the period across PureTech's Wholly Owned Pipeline include:
- PureTech initiated a multiple ascending dose study to evaluate the safety, tolerability and pharmacokinetic profile of LYT-100 in healthy participants in March 2020. Results are anticipated in the second half of 2020.
- PureTech announced plans to advance clinical-stage product candidate LYT-100 as a potential treatment for serious respiratory complications linked to inflammation and fibrosis that persist following the resolution of SARS-CoV-2 (COVID-19) infection (Long COVID) in May 2020. The global, randomised, placebo-controlled trial is expected to initiate in Q3 2020 with topline results expected in mid-2021. PureTech is also exploring the potential application of LYT-100 in additional respiratory conditions, including idiopathic pulmonary fibrosis (IPF) and interstitial lung diseases (ILDs).
- PureTech also plans to initiate a proof-of-concept trial in people with breast cancer-related, upper limb secondary lymphoedema that is expected to begin in the second half of 2020, with topline results expected in 2021.
- PureTech presented a scientific poster supporting its novel monoclonal antibody targeting galectin-9 (LYT-200) at the American Association for Cancer Research (AACR) 2020 Virtual Annual Meeting in June 2020. The poster shared new data that established galectin-9 as a novel target for cancer immunotherapy and provided evidence that therapies targeting galectin-9 may enable the immune system to attack an array of solid tumours. PureTech expects to file an Investigational New Drug Application (IND) for LYT-200 and to initiate a Phase 1 clinical study in solid tumours in the second half of 2020, with results anticipated in 2021.
- PureTech is advancing its GlyphTM technology platform, which employs the body's natural lipid absorption and transport process to orally administer drugs via the lymphatic system and bypass first-pass metabolism. PureTech has evaluated and validated more than 20 molecules as well as a range of novel linker chemistries with this technology platform. The most advanced is LYT-300, which is an oral form of FDA-approved allopregnanolone currently marketed in the US as ZulressoTM (which, unlike LYT-300, is administered as a 60-hour intravenous infusion) that may be applicable to a range of neurological conditions. PureTech has demonstrated oral bioavailability with LYT-300 in large animals (non-human primates) of over 30 per cent and expects to initiate first-in-human clinical studies by the end of 2021.
- PureTech progressed its OrasomeTM technology platform, which utilises multiple vesicle components, including those isolated from milk. The platform is designed to transport macromolecular medicines to selected mucosal cell types of the intestinal tract, where the therapeutics act either directly in the gastrointestinal (GI) tract, transit through the mucosa to the underlying lymphatic vascular network or, in the case of cargos that yield messenger RNAs (mRNAs), enable the body to produce its own therapeutic proteins and peptides, such as antibodies within mucosal cells that are secreted into the mucosal lymphatic vascular network for subsequent systemic distribution. PureTech expects preclinical proof-of-concept data in 2020 and anticipates results from a non-human primate proof-of-concept study in 2021. The proof-of-concept studies are designed to evaluate the presence of therapeutic serum levels of biotherapeutics (peptides and proteins such as antibodies) produced by the body following the oral administration of designer payloads. This work could lay the foundation for IND-enabling clinical studies for one or more additional product candidates to be included in the Company's Wholly Owned Pipeline. PureTech has also regained full rights to certain milk exosome technology applications from F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc, enabling PureTech to advance this technology for antisense oligonucleotides.
- PureTech continued to progress its meningeal lymphatics platform, which aims to correct lymphatic dysfunction in the brain to potentially improve outcomes for a range of neurodegenerative and neuroinflammatory conditions that are not currently effectively treated, such as Alzheimer's disease (AD) and Parkinson's disease. PureTech is mapping the architectural framework that enables the meningeal lymphatics to play a crucial role at the brain-immune nexus and is exploring nodes of intervention for modulating this vasculature and improving macromolecular drainage. Data will be submitted to a peer-reviewed publication in 2021.
2) References in this report to "Wholly Owned Pipeline" refer to the Company's four product candidates (LYT-100, LYT-200, LYT-210 and LYT-300), three discovery platforms, and potential future product candidates and discovery platforms that the Company may develop or obtain.
PureTech's Founded Entities3 have also made significant progress, including:
- Karuna (PureTech ownership: 12.8%; PureTech also has a right to royalty payments as a percentage of net sales)
o In June 2020, Karuna announced next steps in the EMERGENT programme, the clinical programme evaluating KarXT for the treatment of adults with schizophrenia, following the completion of a successful End-of-Phase 2 meeting with the FDA. The outcome of the meeting supports the progression of KarXT into Phase 3 development. Karuna plans to initiate two five-week inpatient trials evaluating the efficacy and safety of KarXT for the treatment of acute psychosis in adults with schizophrenia. The first Phase 3 trial, EMERGENT-2, is expected to commence by the end of 2020. This five-week, 1:1 randomised, flexible-dose, double-blind, placebo-controlled, inpatient trial will enrol approximately 250 adults in the US and evaluate the change in Positive and Negative Syndrome Scale total score at Week 5 of KarXT versus placebo as the primary outcome measure. Details of the second efficacy trial, EMERGENT-3, are expected to be finalised by the end of 2020, with initiation expected in the first half of 2021.
o In January 2020, PureTech sold 2.1 million of its Karuna shares for a cash consideration of $200.9 million. In May 2020, PureTech sold an additional 555,500 shares for a cash consideration of $45 million. On 26 August 2020 (post-period), PureTech sold an additional 1.3 million shares for a cash consideration of approximately $101 million. PureTech intends to use the combined proceeds of approximately $346 million to fund its operations and growth for the foreseeable future, and to further expand and advance its Wholly Owned Pipeline and for growth opportunities.
o In May 2020, Karuna presented data from EMERGENT-1, the Phase 2 clinical trial evaluating KarXT for the treatment of acute psychosis in patients with schizophrenia, at the American Society of Clinical Psychopharmacology (ASCP) 2020 Annual Meeting. The poster and oral presentation detailed new and previously reported efficacy and safety data from the Phase 2 clinical trial.
- Akili (PureTech ownership: 34.0%)
o In June 2020, Akili received clearance from the FDA to market EndeavorRxTM (AKL-T01) as a prescription treatment for children with attention-deficit/hyperactivity disorder (ADHD). The EndeavorRx treatment will be available with a prescription to families soon. In June 2020, Akili also received a Conformité Européenne (CE) Mark certification for EndeavorRx as a prescription-only digital therapeutic software intended for the treatment of attention and inhibitory control deficits in paediatric patients with ADHD. The approval enables the future marketing of EndeavorRx in European Economic Area member countries. Akili plans to launch EndeavorRx in the US initially and it is exploring expansion opportunities in Europe.
o In April 2020, Akili announced that ENDEAVORTM (AKL-T01) would be available for use by children with ADHD and their families in response to new guidance from the FDA recognising the need for access to certain low-risk, clinically-validated digital health devices for psychiatric conditions during the COVID-19 pandemic.
o In January 2020, Akili announced that a study achieved its primary endpoint evaluating the effects of AKL-T01 in children with ADHD when used with and without stimulant medication. The study achieved its predefined primary efficacy outcome, demonstrating that AKL-T01 showed a statistically significant improvement in the ADHD Impairment Rating Scale (IRS) from baseline after one month of treatment (p<0.001) in both children taking stimulant medications and in those not taking stimulants.
o In February 2020, The Lancet Digital Health journal published the results from Akili's STARS-ADHD pivotal trial of AKL-T01.
- Gelesis Inc. (PureTech ownership: 21.0%; PureTech also has a right to royalty payments as a percentage of net sales)
o In June 2020, Gelesis received a CE Mark to market Plenity®4 throughout the European Economic Area as a class III medical device indicated for weight loss in overweight and obese adults with a Body Mass Index (BMI) of 25-40 kg/m2, when used in conjunction with diet and exercise. Gelesis plans to bring Plenity to the US first, where it is now available to a limited extent while Gelesis ramps up commercial operations and inventory for a full launch in 2021.
o In June 2020, Gelesis announced a partnership with China Medical Systems Holdings Ltd. (CMS) for the commercialisation of Plenity in China. Through the terms of the deal, CMS provides to Gelesis $35 million upfront in a combination of licensing fees and equity investment with the potential for an additional $388 million in future milestone payments as well as royalties.
o In March 2020, Gelesis was named to Fast Company's list of the World's Most Innovative Companies for 2020 in the Biotech category.
- Vedanta Biosciences, Inc. (PureTech ownership: 50.4%)
o In June 2020, Vedanta announced positive topline data from two Phase 1 studies in healthy volunteers of VE202, Vedanta's orally-administered live biotherapeutic product (LBP) candidate for IBD. A more complete study dataset and analyses will be submitted to a peer-reviewed journal. Vedanta has regained full rights to the programme from Janssen Biotech, Inc. and plans to take the programme forward into Phase 2 studies over the next 12 months.
o Vedanta has also continued to progress its three ongoing clinical trials of VE303, VE416 and VE800. In 2021, Vedanta anticipates topline results from a Phase 2 trial of VE303 in high-risk CDI, a Phase 1/2 study of VE416 for food allergy, and a first-in-patient clinical trial of VE800 in combination with Bristol-Myers Squibb's programmed death-1 (PD-1) immune checkpoint inhibitor Opdivo® (nivolumab) in patients with select types of advanced or metastatic cancer.
o In June 2020, Vedanta strengthened its balance sheet with an additional $12 million in new equity and R&D collaboration funds, bringing its total Series C round to $71.1 million.
Follica Incorporated (PureTech ownership: 78.3%; PureTech also has a right to royalty payments as a percentage of net sales)
o In June 2020, Follica announced positive feedback from an End-of-Phase 2 meeting with the FDA for its programme to treat male androgenetic alopecia. Follica plans to advance the programme into Phase 3 development in the second half of 2020 following the successful safety and efficacy optimisation study announced in December 2019.
- Vor Biopharma Inc. (PureTech ownership: 11.8%)
o In the July 2020 post-period, Vor announced a $110 million Series B financing to advance VOR33 into clinical trials, deepen its portfolio and accelerate the validation of additional targets for its scientific platform.
o In January 2020, Vor held a pre-IND meeting with the FDA to gather feedback to assemble the data package for a potential IND filing. Vor expects to initiate a Phase 1 study of VOR33 in acute myeloid leukaemia in 2021.
o In May 2020, Vor announced the appointment of Nathan Jorgensen, PhD, as chief financial officer.
o In the July 2020 post-period, Vor announced the appointments of Daniella Beckman and David Lubner to its Board of Directors and Christopher Slapak, MD, as chief medical officer.
- Alivio Therapeutics, Inc. (PureTech ownership: 78.6%)
o Alivio continued to advance its targeted disease immunomodulation platform for the potential treatment of chronic and acute inflammatory disorders. Alivio expects to file an IND for ALV-306 in pouchitis and initiate a clinical trial in 2021. Alivio also expects to file an IND for ALV-107 for IC/BPS in 2021 and an IND for ALV-304 in Inflammatory Bowel Disease (IBD) in 2022. Alivio is also evaluating the potential application of its proprietary platform to enable the oral administration of biologics in additional indications.
- Sonde Health, Inc. (PureTech ownership: 45.8%)
o In the July 2020 post-period, Sonde launched Sonde One, a new voice-enabled health detection and monitoring app, to potentially help employers reopen offices in the rapidly changing COVID-19 environment. The tool combines 6-second voice analysis, CDC-informed COVID-19 questionnaire and body temperature reading in one app and is designed to give employees clear instructions about where they can work within one minute.
o To date, Sonde has collected 300,000 voice samples from over 50,000 individuals, as a part of the ongoing validation of its platform.
- Entrega, Inc. (PureTech ownership: 72.9%)
o Entrega continued to advance its platform for the oral delivery of biologics, vaccines and other drugs that are otherwise not efficiently absorbed when taken orally. As part of its collaboration with Eli Lilly, Entrega is progressing a broad range of prototypes in preclinical studies.
3) Relevant ownership interests for Founded Entities were calculated on a diluted basis (as opposed to a voting basis) as of 30 June 2020, including outstanding shares, options and warrants, but excluding unallocated shares authorised to be issued pursuant to equity incentive plans. Ownership of Vor is based on the assumption that all future tranches of the most recent financing round are funded. Karuna ownership is calculated on an outstanding voting share basis as of 26 August 2020.
4) Important Safety Information: Plenity is contraindicated in patients who are pregnant or are allergic to cellulose, citric acid, sodium stearyl fumarate, gelatine, or titanium dioxide. Plenity may alter the absorption of medications. Read Sections 6 and 8.3 of the Instructions for Use carefully. Avoid use in patients with the following conditions: esophageal anatomic anomalies, including webs, diverticuli, and rings; suspected strictures (such as patients with Crohn's disease); or complications from prior gastrointestinal (GI) surgery that could affect GI transit and motility. Use with caution in patients with active GI conditions such as gastro-esophageal reflux disease (GERD), ulcers or heartburn. The overall incidence of adverse events (AEs) in the Plenity group was no different than the placebo group. The most common side effects were diarrhea, distended abdomen, infrequent bowel movements, and flatulence. For the safe and proper use of Plenity, US Instructions for Use or the EU Instructions for Use.
Upcoming Milestones (next 12 to 24 months)
Several milestones are anticipated over the next 12 to 24 months:
- PureTech anticipates results from a multiple ascending dose study of LYT-100 in healthy participants in the second half of 2020.
- PureTech expects to initiate a global, randomised, placebo-controlled Phase 2 trial of LYT-100 for the treatment for serious respiratory complications linked to inflammation and fibrosis that persist following the resolution of SARS-CoV-2 (COVID-19) infection in Q3 2020, with topline results anticipated in mid-2021.
- PureTech expects to initiate a proof-of-concept study of LYT-100 in people with breast cancer-related, upper limb secondary lymphoedema in the second half of 2020, with topline results anticipated in 2021.
- PureTech is exploring the potential application of LYT-100 in additional respiratory conditions, including idiopathic pulmonary fibrosis (IPF) and interstitial lung diseases (ILDs).
- PureTech expects to file an IND for LYT-200 and to initiate a Phase 1 study in solid tumours in the second half of 2020, with results anticipated in 2021.
- PureTech plans to continue to advance preclinical and biomarker studies for LYT-210 in the second half of 2020.
- PureTech expects to carry out additional preclinical studies with LYT-300 (oral allopregnanolone) to support the initiation of first-in-human clinical studies by the end of 2021. Achieving oral bioavailability for allopregnanolone, a natural neurosteroid, may enable its development for the potential treatment of a range of neurological conditions.
- PureTech expects preclinical proof-of-concept data in the second half of 2020 and anticipates results from a non-human primate proof-of-concept study in 2021 for its Orasome technology platform, which utilises multiple vesicle components, including those isolated from milk. This work could lay the foundation for IND-enabling clinical studies for one or more additional product candidates.
- PureTech expects to submit data to a peer-reviewed publication in 2021 from its work exploring nodes of intervention for modulating the architectural framework that enables the meningeal lymphatics to play a crucial role at the brain-immune nexus and improve macromolecular drainage.
- Karuna expects to initiate the first Phase 3 trial in the EMERGENT programme, EMERGENT-2, evaluating KarXT for the treatment of adults with schizophrenia, by the end of 2020.
- Karuna expects topline results from a Phase 1b clinical trial evaluating the safety and tolerability of KarXT in healthy elderly volunteers by the end of 2020.
- Akili expects that the EndeavorRxTM treatment will be available with a prescription to families in the US soon.
- Gelesis expects a full launch of Plenity® in the US in 2021.
- Gelesis expects to initiate a Phase 3 study of GS500 in functional constipation in the second half of 2020.
- Gelesis plans to seek FDA input on the requirements for expanding the Plenity label for treating adolescents.
- Gelesis expects topline results from a Phase 2 study of Gelesis200 in weight management and glycaemic control in adults with type 2 diabetes and prediabetes in 2021.
- Gelesis expects to initiate a Phase 2 study of GS300 in non-alcoholic steatohepatitis/non-alcoholic fatty liver disease (NASH/NAFLD) in the second half of 2020.
- Vedanta expects to advance VE202 into a Phase 2 study in IBD in 2021.
- Vedanta anticipates topline results from a Phase 2 trial of VE303 in high-risk CDI in 2021.
- Vedanta anticipates topline results from the first-in-patient clinical trial of VE800 in combination with Bristol-Myers Squibb's programmed death-1 (PD-1) immune checkpoint inhibitor Opdivo® (nivolumab) in patients with select types of advanced or metastatic cancer in 2021.
- Vedanta anticipates topline data from a Phase 1/2 study of VE416 for food allergy in 2021.
- Follica expects to initiate a Phase 3 registration study in male androgenetic alopecia in the second half of 2020.
- Vor expects to initiate a Phase 1 study of VOR33 in acute myeloid leukaemia in 2021.
- Alivio expects to file an IND for ALV-306 in pouchitis and initiate a clinical trial in 2021.
- Alivio expects to file an IND for ALV-107 for IC/BPS in 2021 and an IND for ALV-304 in IBD in 2022.
- Sonde anticipates topline results from a depression detection study in the second half of 2020.
- PureTech Level Cash Reserves5 grew by $189.9 million within the period, and as of 30 June 2020 were $310.5 million (31 December 2019: $120.6 million). These figures exclude the approximate $101 million in proceeds from the 26 August 2020 sale of 1.3 million Karuna common shares.
- Consolidated Cash Reserves6 at 30 June 2020 were $340.1 million (31 December 2019: $162.4 million).
- Founded Entities also strengthened their collective balance sheets by attracting $136.5 million7 in equity investments and non-dilutive funding, including $135.5 million from third parties. The balance of the funding is between PureTech and its Founded Entities. Since July 2018, Founded Entities have raised over $890 million, of which $823.4 (92%) was from third parties.
- perating Loss for the period was $52.8 million (30 June 2019: $70.3 million).
5) PureTech Level Cash Reserves represent cash balances and short-term investments held at PureTech Health LLC, PureTech Management, Inc., PureTech Health PLC, PureTech Securities Corporation of $284.2 million and the internal pipeline of $26.3million for the six months ended 30 June 2020, all of which are wholly-owned entities of PureTech, excluding cash balances and short-term investments of Controlled Founded Entities.
6) Consolidated Cash Reserves includes cash balances of $340.1million and short-term investments of nil at 30 June 2020 as shown on the Consolidated Statements of Financial Position.
7) Vor's $110 million Series B is included in this figure as it closed in June 2020 and was announced in the July 2020 post-period.
Commenting on PureTech's half-yearly results, Daphne Zohar, founder and chief executive officer of PureTech, said:
"The first half of 2020 has been an exceptional period for PureTech with the achievement of multiple notable regulatory milestones, important clinical progress and substantial financings and monetisation events across our Wholly Owned Pipeline and Founded Entities. In the month of June alone we announced the FDA clearance of Akili's EndeavorRxTM and the European marketing authorisation of both Gelesis' Plenity® and Akili's EndeavorRx, two products initiated and developed from PureTech's unique and productive R&D engine. We are proud to have delivered on our commitment to patients in two areas of medicine where great need exists, and we look forward to the US launch of both products in the near-term.
"We also progressed our Wholly Owned Pipeline with the initiation of a Phase 1 study for LYT-100, which we plan to advance into two, Phase 2 studies for the treatment of serious respiratory complications that persist following the resolution of COVID-19 infection and breast cancer related lymphoedema before the end of the year, along with a Phase 1 study of LYT-200 for the treatment of solid tumours.
"During this period, we have also demonstrated a strong commitment to value realisation through the monetisation of Founded Entity equity. In the first half of 2020 we generated over $245 million from the sales of minority shares in certain Founded Entities to help fuel the future growth of the Company, and we are well-capitalised into the first quarter of 2024 with $310.5 million as of 30 June 2020. We have also generated an additional approximately $101 million in the August post-period from a subsequent sale of Founded Entity equity.
"We are energised by the progress from the first half of the year, and we aim to continue this momentum across our Wholly Owned Pipeline and our Founded Entities as we collectively work to deliver highly differentiated medicines for patients and value for shareholders."
For more information, please contact:
+1 617 456 0032
Daphne Zohar, founder & chief executive officer
Allison Mead Talbot, head of communications
FTI Consulting (Communications adviser to PureTech)
+44 (0) 20 3727 1000
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