Frequency Therapeutics, Inc, a clinical-stage regenerative medicine company focused on developing therapeutics to activate a person’s innate regenerative potential to restore function, announced business updates and financial results for the fourth quarter and full year ended December 31, 2021.
“The year ahead has numerous milestones for Frequency and our lead program FX-322, as we plan to complete enrollment and work toward a readout of our FX-322-208 Phase 2b study of individuals with sudden and noise-induced sensorineural hearing loss (SNHL). The design of the study is based on key insights from having built what we believe to be the largest clinical data set in the hearing restoration space, enabling us to hone-in on the severities and etiologies where we have observed FX-322 to have shown clinically meaningful outcomes. We are also aligned with the US Food and Drug Administration on speech perception as the primary endpoint for this study, which we believe increases the likelihood of future technical and regulatory success. We remain on track to report study results by the end of this year, or in the first quarter of next year,” said David L. Lucchino, Frequency’s Chief Executive Officer.
Lucchino continued: “2021 was also a highly productive year for our research engine as we worked to expand our clinical pipeline with a second program in hearing restoration. Our new hearing asset, FX-345, has shown pre-clinically to be highly potent, potentially enabling the drug candidate to exert its activity further into the cochlea and treat more and different types of SNHL. We also shared compelling data from our pre-clinical program for remyelination in MS, where we have discovered a novel target and demonstrated a powerful remyelinating effect in vivo. With significant readouts and milestones in the year ahead, we believe we have multiple opportunities to advance new regenerative approaches in hearing loss and MS while working to transform the standard of care for both of these conditions.”
Recent Pipeline Progress and Corporate Highlights
FX-322-208 Phase 2b Study in Acquired SNHL: In October 2021, Frequency announced that the first subject was dosed in a new Phase 2b study of acquired SNHL. FX-322-208 is a randomized, placebo-controlled, multi-center study designed to evaluate the impact of a single administration of FX-322 on speech perception in approximately 124 subjects with SNHL. FX-322-208 includes subjects with hearing loss associated with either noise-induced or sudden SNHL. The study’s primary endpoint is speech perception, a measure of sound clarity and understanding speech. Study enrollment is progressing to plan with more than 25 clinical sites in operation. The Company recently amended the study protocol, adding six- and nine-month visits to assess durability and provide further insight into potential redosing. Topline FX-322-208 study results are planned for either late 2022 or early 2023.
Based on learnings from five prior FX-322 studies, extensive design elements have been included in FX-322-208 to mitigate potential bias and help ensure the consistency of baseline hearing assessments. Data from these studies have also enabled Frequency to design the FX-322-208 study inclusive of the hearing loss etiologies and severities where speech perception improvements were previously observed. To date, no drug-related serious adverse events have been reported by individuals who have been dosed in any FX-322 study.
FX-345, a Second Sensory Hair Cell Regeneration Program for SNHL: In November 2021, Frequency announced FX-345 as “a new, highly potent, investigational therapeutic candidate for SNHL.” Pharmacokinetic measures and human modeling data suggest that administration of FX-345 can result in therapeutically active drug levels in a larger portion of the cochlea, which would enable Frequency to explore the potential for a hearing restoration therapeutic that could address a broad set of hearing loss severities and etiologies. FX-345 is being evaluated in investigational new drug (IND)-enabling studies and Frequency anticipates filing an IND application for FX-345 in the second half of 2022.
Pre-clinical Program for Remyelination in Multiple Sclerosis: In November 2021, Frequency announced a discovery effort to remyelinate neurons in the central nervous system to treat MS. The Company has identified a new biological target relevant to myelination and demonstrated that modulation of this target drives robust oligodendrocyte differentiation and expression of myelin proteins in vitro. Multiple novel chemical entities have been identified that induce robust remyelination in vivo. The Company expects to finalize selection of a lead remyelination development candidate for advancement into clinical development in 2022 with plans for an IND in 2023.
Recent Investor Events and Corporate Presentations
Oppenheimer 32nd Annual Healthcare Conference: On March 16 at 3:20 PM ET, Frequency CEO David L. Lucchino will present a Company overview. A replay will be available on the Company investor site at: www.frequency.com/investors.
Cowen 42nd Annual Health Care Conference: On March 7, CEO David L. Lucchino participated in a panel discussion with executives from other leading audiology and ophthalmology companies. A replay of the program can be found here.
40th Annual J.P. Morgan Healthcare Conference: On January 13, CEO David L. Lucchino and Frequency management provided a Company update and near-term timelines and milestones. A replay of the program can be found here.
Virtual R&D Event: On November 9, 2021, Frequency hosted a virtual investor event that reviewed advances of the Company’s FX-322 program for SNHL, as well as new potential restorative treatment programs for hearing loss and remyelination in MS. A replay of the program and of each individual presentation can be found here.
Fourth Quarter 2021 Financial Results
Cash Position: Cash, cash equivalents, and marketable securities as of December 31, 2021, were $142.4 million (excluding restricted cash). Based on current plans and assumptions, the Company believes its existing cash, cash equivalents, and marketable securities will be sufficient to fund its operations through the end of 2023. This guidance does not include potential future milestones which could be received from Astellas for continued FX-322 development, according to the announcement.
Revenue: As all revenue related to the Astellas Agreement was recognized as of June 30, 2021, there was no revenue recognized in the three months ending December 31, 2021, compared to $10.0 million in the comparable period of 2020. Revenue was $14.1 million for the twelve months ending December 31, 2021, compared to $37.0 million in the comparable period of 2020, the company says.
Research & Development Expenses: Research and development expenses were $12.8 million and $60.9 million for the three- and twelve-month periods ending December 31, 2021, respectively, as compared to $11.8 million and $37.4 million for the comparable periods of 2020. The increase was due to increased costs related to the Company’s lead product candidate, FX-322, as well as costs related to the Company’s new investigational therapeutic programs in hearing restoration and MS. Excluding stock-based compensation expense of $2.2 million and $9.6 million for the three- and twelve-months ending December 31, 2021, research and development expenses for the three- and twelve-months ending December 31, 2021, were $10.6 million and $51.3 million, respectively, according to the announcement.
General and Administrative Expenses: General and administrative expenses were $8.6 million and $37.2 million for the three- and twelve-months ending December 31, 2021, respectively, as compared to $8.4 million and $27.1 million for the comparable periods of 2020. The increase was primarily due to an increase in personnel-related costs including stock-based compensation, as well as costs associated with being a public company, primarily comprised of professional fees. Excluding stock-based compensation expense of $3.0 million and $12.2 million for the three- and twelve-months ending December 31, 2021, general and administrative expenses for the three- and twelve-months ending December 31, 2021, were $5.7 million and $25.1 million, respectively.
Net Loss: Net loss was $21.5 million and $84.7 million for the three- and twelve-months ending December 31, 2021, as compared to $10.2 million and $26.5 million for the comparable periods of 2020. The increase in net loss reflects the increase in research and development costs associated with the growth of Frequency’s research and development organization as well as the increase in general and administrative expenses required to support the growth of Frequency as a public company, according to the announcement.
Source: Frequency Therapeutics
