Geron Corporation (Nasdaq: GERN), a late-stage clinical biopharmaceutical company developing a first-in-class telomerase inhibitor, imetelstat, to treat hematologic malignancies, today reported business updates and financial results for the first quarter of 2023.
“We believe that imetelstat has a compelling commercial value proposition and is well-positioned to become a standard of care in lower risk MDS, based on unprecedented broad durability of transfusion independence in the IMerge Phase 3 trial and high unmet need in this patient population,” said John A. Scarlett, M.D., Chairman and Chief Executive Officer. “We are on track to submit a New Drug Application in the U.S. next month and are preparing for a potential U.S. commercial launch in the first half of 2024. Further, we are planning to submit a Marketing Authorization Application in the EU in the second half of 2023 and preparing for an EU commercial launch by the end of 2024.”
Dr. Scarlett also noted, “We also continue to make progress on recruiting and enrolling patients into IMpactMF, the first and only Phase 3 study of JAK inhibitor relapsed/refractory myelofibrosis patients with a primary endpoint of overall survival. If this trial is successful, we expect imetelstat to become a transformational agent for these patients.”
Dr. Scarlett added, “As of the end of the quarter, we had over $400 million on the balance sheet, which we believe provides the financial resources to operate the company through the end of the third quarter of 2025. This means we expect to launch in lower risk MDS without being compromised by lack of funding, while also supporting IMpactMF and our other ongoing earlier stage programs.”
Financial Resources to Support Potential Commercial Launch of Imetelstat in Lower Risk Myelodysplastic Syndromes (MDS)
As of March 31, 2023, the Company had $409.2 million in cash and marketable securities. In January 2023, the Company closed an underwritten public offering of common stock and pre-funded warrant, plus the full exercise of the underwriters’ option to purchase additional shares of common stock, for net cash proceeds of $213.3 million, after deducting the underwriting discount and other offering expenses. In addition, the Company received $59.8 million upon the cash exercise of outstanding warrants in the first quarter of 2023. Based on the Company’s current operating plans and expectations regarding the timing of regulatory approval and commercialization of imetelstat in the United States (U.S.) in the first half of 2024, Geron projects that its existing financial resources will be sufficient to fund its projected operating requirements through the end of the third quarter of 2025.
First Quarter 2023 Financial Results
For the first quarter of 2023, the Company reported a net loss of $38.1 million, or $0.07 per share, compared to $30.1 million, or $0.09 per share, for the first quarter of 2022.
Revenues for the first quarter of 2023 were $21,000 compared to $123,000 for the same period in 2022. Royalty revenues in 2023 and 2022 primarily reflect estimated royalties from sales of cell-based research products from the Company’s divested stem cell assets.
Total operating expenses for the first quarter of 2023 were $40.1 million, compared to $28.8 million for the same period in 2022. Research and development expenses for the first quarter of 2023 were $27.2 million, compared to $22.1 million for the same period in 2022. The increase in research and development expenses for the three months ended March 31, 2023, compared to the same period in 2022, primarily reflects higher clinical trial costs related to supporting IMerge Phase 3 and IMpactMF and increased personnel-related expenses for additional headcount. General and administrative expenses for the first quarter of 2023 were $12.9 million compared to $6.7 million for the same period in 2022. The increase in general and administrative expenses for the three months ended March 31, 2023, compared to the same period in 2022, primarily reflects new costs for commercial preparatory activities and higher personnel-related expenses for additional headcount.
Interest income for the first quarter of 2023 was $3.9 million, compared to $112,000 for the same period in 2022. The increase in interest income for the three months ended March 31, 2023, compared to the same period in 2022, primarily reflects higher yields on the Company’s marketable securities as a result of rising interest rates, as well as a larger investment portfolio with the cash proceeds from the January 2023 offering and warrant exercises in the first quarter of 2023.
Interest expense for the first quarter of 2023 was $1.9 million, compared to $1.5 million for the same period in 2022. The increase in interest expense for the three months ended March 31, 2023, compared to the same period in 2022, primarily reflects higher interest rates. Under the terms of the loan agreement, the interest-only payment period was extended by 12 months from April 2023 to April 2024 as a result of achieving positive top-line results from IMerge Phase 3 in January 2023. Currently, the Company has $50.0 million in principal debt outstanding.
Projected 2023 Financial Guidance Reaffirmed
For fiscal year 2023, under generally accepted accounting principles (GAAP), the Company continues to expect total expenses in the range of approximately $210 million to $220 million, which includes non-cash items such as: stock-based compensation expense, amortization of debt discounts and issuance costs and depreciation and amortization. The Company expects non-GAAP total expenses for fiscal year 2023 to be in the range of approximately $200 million to $210 million. This guidance excludes estimated non-cash items such as: stock-based compensation expense, amortization of debt discounts and issuance costs, as well as depreciation and amortization.
The fiscal year 2023 financial guidance reflects costs to support planned regulatory submissions in 2023; continued support of ongoing clinical trials, IMerge Phase 3, IMpactMF, IMproveMF and IMpress, as well as preclinical studies in lymphoid malignancies and discovery research for a next generation telomerase inhibitor; manufacturing commercial inventory of imetelstat; preparations for potential U.S. commercial launch of imetelstat in lower risk MDS; projected increases in headcount and interest payments on outstanding debt.
As of March 31, 2023, the Company had 120 employees. The Company plans to grow to a total of approximately 150 to 160 employees by year-end 2023.
Source: https://www.businesswire.com/
