Kite Pharma Inc (NASDAQ: KITE) provided a corporate update and reported fourth quarter and full-year 2016 financial results for the period that ended December 31, 2016.
In a separate announcement today, Kite issued positive top-line results from the primary analysis of the ZUMA-1 study of axicabtagene ciloleucel in patients with aggressive non-Hodgkin lymphoma (NHL). Kite continues to expect completion of its rolling submission of a Biologics License Application (BLA) to the U.S. Food and Drug Administration (FDA) for axicabtagene ciloleucel (KTE-C19) for the treatment of aggressive NHL by the end of the first quarter 2017, with potential approval and commercial launch in 2017.
“The accomplishments, leadership additions to the company, and performance of Kite during 2016 put us in a position of strength as we prepare to potentially deliver the first CAR-T therapy for aggressive NHL to patients later this year,” said Arie Belldegrun, M.D., FACS, Chairman, President, and Chief Executive Officer. “Beyond axicabtagene ciloleucel, we have taken important steps to expand Kite’s global footprint and pipeline of cell therapy candidates. Through our recently announced strategic collaborations with Fosun Pharma and Daiichi Sankyo, our plans for submission and potential launch in Europe, and ongoing clinical studies of axicabtagene ciloleucel, we look ahead to an increasingly strong future for Kite.”
Fourth Quarter and Full Year 2016 Financial Results
- Revenues were $4.9 million for the fourth quarter of 2016 and $22.2 million for the full year of 2016.
- Research and development expenses were $58.9 million for the fourth quarter of 2016, which includes $8.9 million of non-cash stock-based compensation expense. For the full year of 2016, research and development expenses were $197.9 million, which includes $34.7 million of non-cash stock-based compensation expense.
- General and administrative expenses were $31.8 million for the fourth quarter of 2016, which includes $10.8 million of non-cash stock-based compensation expense. For the full year of 2016, general and administrative expenses were $97.4 million, which includes $38.8 million of non-cash stock-based compensation expense.
- Net loss was $84.9 million, or $1.70 per share, for the fourth quarter of 2016. For the full year of 2016, net loss was $267.1 million, or $5.46 per share.
- Non-GAAP net loss for the fourth quarter of 2016 was $65.2 million, or $1.31 per share, excluding non-cash stock-based compensation expense of $19.7 million. For the full year of 2016, non-GAAP net loss was $193.5 million, or $3.95 per share, excluding non-cash stock-based compensation expense of $73.6 million.
- As of December 31, 2016, Kite had $414.4 million in cash, cash equivalents, and marketable securities. In January 2017, Kite received a $50 million upfront payment from Daiichi Sankyo related to the recently announced strategic collaboration in Japan.
2017 Financial Guidance
- Kite expects full year 2017 net cash burn to be between $325 million and $340 million, which includes approximately $30 million in capital expenditures but excludes cash inflows or cash outflows from business development activities, if any, and excludes planned upfront payments totaling $90 million from recently announced strategic collaborations in Asia. Estimated full year 2017 cash burn is driven primarily by a projected GAAP net loss of between $450 million and $465 million. The 2017 projected net loss includes non-cash stock-based compensation expenses of approximately $135 million.
- Kite expects full year 2017 revenue to be between $40 million and $50 million, which assumes no product revenue, and full year 2017 GAAP operating expenses to be between $490 million and $515 million.
- As previously announced, Kite expects to have sufficient cash resources to fund its current operations, including planned clinical development programs, through the first half of 2018. This projection excludes cash inflows or cash outflows from future business development activity, if any.
Axicabtagene Ciloleucel/KTE-C19 Progress
- Presented positive interim results from the ZUMA-1 Phase 2 study of axicabtagene ciloleucel in aggressive NHL in a late-breaker oral presentation at the 2016 American Society of Hematology (ASH) annual meeting.
- Reported a Phase 1 update from the ZUMA-3 and ZUMA-4 trials of KTE-C19 in adult and pediatric relapsed/refractory acute lymphoblastic leukemia at the 2016 ASH annual meeting.
- Initiated ZUMA-6, a Phase 1b/2 study of axicabtagene ciloleucel in combination with the checkpoint inhibitor atezolizumab in patients with chemorefractory diffuse large B-cell lymphoma (DLBCL) in collaboration with Genentech.
- Presented results from SCHOLAR-1, the first patient-level pooled analysis of outcomes in chemorefractory DLBCL, providing an important historical benchmark for studies of the disease.
- Initiated BLA rolling submission to the FDA for axicabtagene ciloleucel in December 2016.
- Received Orphan Drug Designation from the FDA for KTE-C19 in the treatment of five additional B-cell malignancies, granting Kite the designation for the major indications in hematologic malignancies in the US. KTE-C19 also has Orphan Drug Designation in the EU for these indications.
- Received Priority Medicines (PRIME) status from the European Medicines Agency for KTE-C19 in the treatment of chemorefractory DLBCL.
Axicabtagene Ciloleucel Commercial & Manufacturing Readiness
- Achieved 99 percent success rate in the manufacturing of clinical product patient dose from a single apheresis for the multi-center ZUMA-1 clinical trial.
- Marked the official opening of Kite’s commercial manufacturing plant, a state-of-the-art facility in El Segundo, California estimated to have the capacity to produce more than 4,000 patient therapies per year.
- Initiated development of Kite Konnect™, a cloud-based solution for commercial-scale ordering, logistics, monitoring and delivery of T-cell therapies, designed to enable a positive prescriber and patient experience.
Pipeline Expansion and Developments
- Submitted an investigational new drug (IND) application for KITE-718, a TCR product candidate that targets MAGE-A3/A6 antigens expressed on solid tumors.
- Initiated plans to file an IND application in 2017 for KITE-585, a CAR product candidate targeting B cell maturation antigen (BCMA) for multiple myeloma.
- Initiated plans to file IND applications in 2018 for KITE-796, a CAR product candidate targeting CLL-1 in acute myeloid leukemia (AML), and for KITE-439, a TCR product candidate targeting human papillomavirus (HPV)-16 E7 for cervical cancer, head and neck cancer, and other solid tumors.
- Entered into a new Cooperative Research and Development Agreement (CRADA) for the development of a fully human anti-CD19 CAR product candidate to treat B-cell malignancies with the National Cancer Institute (NCI).
- Licensed intellectual property related to a fully human anti-CD19 CAR to treat B-cell malignancies from the National Institutes of Health (NIH).
- Expanded the TCR portfolio by licensing intellectual property from the NIH related to multiple TCR product candidates for the treatment of solid tumors expressing mutated KRAS antigens.
- Entered into a new CRADA for the development of TCR product candidates directed against HPV-16 E6 and E7 for the treatment of HPV-associated cancers with the NCI.
- Licensed a technology platform from The Regents of the University of California, on behalf of the University of California, Los Angeles, for the scalable production of T cells using pluripotent stem cell lines capable of indefinite self-renewal and designed to overcome limitations of current allogeneic approaches.
- Partnered with Leiden University Medical Center to develop TCR product candidates targeting solid tumors associated with HPV-16 infection. (Original Source)
Shares of Kite Pharma closed yesterday at $56.83. KITE has a 1-year high of $64.30 and a 1-year low of $39.82. The stock’s 50-day moving average is $51.38 and its 200-day moving average is $51.95.
On the ratings front, Kite Pharma has been the subject of a number of recent research reports. In a report issued on February 22, Wells Fargo analyst Jim Birchenough initiated coverage with a Hold rating on KITE. Separately, on February 1, Wedbush’s David Nierengarten initiated coverage with a Hold rating on the stock and has a price target of $46.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Jim Birchenough and David Nierengarten have a yearly average return of 27.1% and 31.2% respectively. Birchenough has a success rate of 53% and is ranked #89 out of 4504 analysts, while Nierengarten has a success rate of 54% and is ranked #81.
Overall, 3 research analysts have assigned a Hold rating and 9 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $65.50 which is 15.3% above where the stock closed yesterday.
Kite Pharma, Inc. is a clinical stage biotechnology company, which engages in the development and commercialization of novel cancer immunotherapy products designed to target and kill cancer cells. It uses engineered autologous cell therapy, which involves the genetic engineering of T cells. Its lead product candidate, KTE-C19, a CAR-based therapy, which seeks treat patients with refractory diffuse large B-cell lymphoma, primary mediastinal large B-Cell lymphoma, and transformed follicular lymphoma.