Chinook Therapeutics Reports Fourth Quarter and Full Year 2022 Financial Results and Provides Corporate Updates
02/27/2023 - 04:00 PM
SEATTLE, Feb. 27, 2023 (GLOBE NEWSWIRE) -- Chinook Therapeutics, Inc. (Nasdaq: KDNY), a biopharmaceutical company focused on the discovery, development and commercialization of precision medicines for kidney diseases, today reported financial results for the fourth quarter and year ended December 31, 2022 and provided corporate updates.
“During 2022, we made excellent progress across our pipeline, including driving strong enrollment of our phase 3 ALIGN, phase 2 AFFINITY and phase 1/2 BION-1301 clinical trials, generating compelling clinical data from our atrasentan and BION-1301 programs for IgA nephropathy (IgAN), initiating our phase 1 clinical trial of CHK-336 in healthy volunteers and continuing to advance our preclinical programs for rare, severe chronic kidney diseases,” said Eric Dobmeier, president and chief executive officer of Chinook Therapeutics. “Our mission at Chinook is to change the course of kidney care by developing therapies that make dialysis and transplant unnecessary for patients living with kidney disease. With our strong financial position and growing team, we look forward to an exciting 2023 when we will be presenting data from all three of our clinical programs at medical conferences, commencing a phase 3 study of BION-1301 in patients with IgAN mid-year and reporting topline proteinuria data from the ongoing phase 3 ALIGN study of atrasentan.”
2022 and Recent Accomplishments
Atrasentan A ) receptor antagonist that has potential therapeutic benefit in multiple chronic kidney diseases by reducing proteinuria and having direct anti-inflammatory and anti-fibrotic effects to preserve kidney function. The phase 3 ALIGN trial is evaluating atrasentan in patients with IgAN and the phase 2 AFFINITY basket trial is evaluating atrasentan in patients with proteinuric glomerular diseases.
Enrollment in the phase 3 ALIGN trial of atrasentan now exceeds 270 patients. The interim proteinuria endpoint analysis will be performed on the first 270 patients enrolled. In response to review of the statistical analysis plan for the ALIGN trial, Chinook received correspondence from the U.S. Food and Drug Administration (FDA) last week recommending that evaluation of the interim proteinuria endpoint analysis for accelerated approval in the ALIGN trial be delayed from week 24 to week 36. The FDA referenced the likelihood that the later timepoint would allow for a greater amount of eGFR data to be evaluated at the time of accelerated approval. Chinook plans to engage with the FDA as soon as possible to discuss their advice. If Chinook shifts the interim proteinuria endpoint analysis of the ALIGN trial to 36 weeks, topline proteinuria data would be expected in the fourth quarter of 2023. Therefore, Chinook is updating its timing to report topline proteinuria data from the ALIGN trial to the second half of 2023. Chinook has completed enrollment of the IgAN patient cohort of the AFFINITY trial, and continues to enroll the other cohorts, including patients with focal segmental glomerulosclerosis (FSGS), Alport syndrome and diabetic kidney disease in combination with SGLT2 inhibitors. Chinook plans to report additional data from cohorts of the AFFINITY trial in the second half of 2023. In November 2022, the United States Patent and Trademark Office (USPTO) issued U.S. Patent No. 11,491,137, titled, “Methods of Improving Renal Function,” which is directed to methods of treating patients with IgAN with atrasentan, and expires in 2040 absent any patent term extensions. Several presentations on atrasentan were delivered at nephrology conferences throughout 2022, including:Updated interim data from the IgAN patient cohort of the phase 2 AFFINITY trial demonstrated consistent and clinically meaningful proteinuria reductions in patients with IgAN already on a maximally tolerated and stable dose of a RAS inhibitor. Specifically, atrasentan demonstrated mean reductions in 24-hour urine protein creatinine ratio (UPCR) of 38.1% at six weeks of treatment, 48.3% at 12 weeks of treatment and 54.7% at 24 weeks of treatment. After 24 weeks of treatment, 15 of the 19 patients (79% ) who had completed this visit had greater than a 40% reduction in UPCR. There were no meaningful changes in blood pressure or acute eGFR effects, suggesting proteinuria reductions were not primarily due to hemodynamic effects of atrasentan, and there were no increases in BNP or mean bodyweight, suggesting minimal fluid retention. Atrasentan was well-tolerated, with no treatment-related serious adverse events. (ASN Kidney Week 2022) Preclinical research on single-cell RNA-seq of a mouse model of IgAN, revealing a prominent expansion of failed repair proximal tubular epithelial cells, which was reversed by atrasentan but not by ACE inhibition. (ASN Kidney Week 2022) Preclinical mechanistic data describing atrasentan’s effect to block mesangial cell injury and the pathogenic transcriptional networks driving IgAN progression in a model system. (59th ERA Congress) BION-1301
Chinook has finalized trial design, is conducting site and country feasibility and completing global regulatory interactions to enable initiation of a phase 3 trial of BION-1301 in mid-2023. Chinook has completed enrollment of 30 patients in Cohort 2 of Part 3 of the ongoing phase 1/2 trial of BION-1301. Patients in Cohort 2 receive a subcutaneous (SC) dose of 600 mg of BION-1301 every two weeks. Chinook plans to report additional data from Cohorts 1 and 2 in the first and second half of 2023. Chinook presented interim data from Cohorts 1 and 2 in a poster presentation at ASN Kidney Week 2022 in November, further demonstrating BION-1301’s disease-modifying potential in IgAN by generating rapid and durable reductions in mechanistic biomarkers and corresponding clinically meaningful proteinuria reductions within three months of initiating treatment, which was consistent across both cohorts. 30.4% in seven patients at 12 weeks of treatment, 48.8% in eight patients at 24 weeks of treatment, 66.9% in eight patients at 52 weeks of treatment, 67.4% in four patients at 76 weeks of treatment and 71.0% in two patients at 100 weeks of treatment. 28.7% in 15 patients at 12 weeks of treatment and 53.8% in 9 patients at 24 weeks of treatment, similar to reductions observed at the same timepoints in Cohort 1. BION-1301 was granted orphan drug designation for the treatment of primary IgAN by the European Commission in July 2022. CHK-336
The phase 1 single ascending dose (SAD) and multiple ascending dose (MAD) clinical trial evaluating CHK-336 in healthy volunteers is ongoing, and initial data from this trial is expected in the first half of 2023. Chinook presented a poster on CHK-336 at ASN Kidney Week 2022, demonstrating preclinical efficacy in PH1 and PH2 mouse models, and the potential for benefit in non-genetic hyperoxalurias caused by oxalate overproduction was also described. Precision Medicine Research & Discovery
Chinook delivered an oral presentation at ASN Kidney Week 2022 in November on a multi-omics approach to the characterization of IgAN in the NURTuRE cohort, integrating clinical, histological, transcriptomic and serum proteomic data to gain deeper insights into patient stratification and IgAN disease pathogenesis. Also at ASN, Chinook presented a poster in collaboration with Evotec on a human data-driven, patient-centric and multi-omics-enabled target identification framework focused on common cellular and molecular mechanisms of CKD by leveraging the NURTuRE and QUOD patient cohorts. Chinook delivered an oral presentation at the 59th ERA Congress in May 2022 on the approach used in collaboration with Evotec to leverage the NURTuRE CKD biobank to generate mechanistic disease understanding for patient-centric, integrated target and biomarker discovery that will enable the development of novel precision treatments for CKD patient subsets. Corporate
Chinook recently announced the appointment of Andrew Oxtoby as Chief Commercial Officer. Under Andrew’s leadership, Chinook will develop its go-to-market strategy and build a commercial organization in preparation for the potential launch of atrasentan and future pipeline products. Andrew brings to Chinook over 20 years of experience in marketing, sales, finance and commercial leadership roles at Aimmune Therapeutics and Eli Lilly and Company. Sairopa B.V. (Sairopa) entered into an exclusive agreement with Exelixis, Inc. in November 2022 for the development of ADU-1805, a monoclonal antibody targeting SIRPα, and received an upfront payment of $40.0 million . The U.S. Food and Drug Administration (FDA) recently cleared Sairopa’s Investigational New Drug (IND) Application to evaluate the safety and pharmacokinetics of ADU-1805 in adults with advanced solid tumors, which triggers a $35.0 million milestone payment that will be paid to Sairopa in the first quarter of 2023. Under the terms of the agreement, Sairopa is eligible to receive additional payments if Exelixis exercises its option and upon achievement of specified development, commercial and net sales milestones, as well as tiered royalties on net sales worldwide. As of December 31, 2022, Chinook owned approximately a 36% interest in Sairopa and has one seat on its board of directors. Chinook will hold its shares in Sairopa until there is a liquidation event, at which time, in accordance with the CVR agreement, 50% of any net proceeds will accrue to the benefit of the CVR holders, net of deductions permitted, including taxes and certain other expenses. Chinook closed a $120.7 million public offering in May 2022, which included the exercise in full of the underwriters’ option to purchase additional shares of common stock. Chinook announced an outreach initiative in collaboration with the IgA Nephropathy Foundation and Komodo Health in April 2022, leveraging data and technology to drive awareness of IgAN and engage key medical providers at nephrology practices across the U.S., with the goal of ensuring patients have access to optimal support and treatment options earlier in their disease journey. Fourth Quarter and Full Year Ended December 31, 2022 Financial Results
Cash Position – Cash, cash equivalents and marketable securities totaled $385.3 million as of December 31, 2022, compared to $355.1 million as of December 31, 2021. Revenue – Revenue for the quarter and year ended December 31, 2022 was $0.5 million and $6.1 million , respectively, compared to $51.2 million and $51.6 million for the same periods in 2021. The higher revenue amounts in 2021 were primarily due to $41.2 million non-cash revenue recognized under Chinook’s license agreement with SanReno Therapeutics and a $10.0 million milestone payment earned under the collaboration agreement with Merck.Expenses – Research and development expenses for the quarter and year ended December 31, 2022 were $43.0 million and $141.2 million , respectively, compared to $24.9 million and $97.0 million , respectively, for the same periods in 2021. The increase was primarily due to higher employee-related costs, including stock-based compensation expense, an increase in licensing and contract research and manufacturing costs, consulting and outside services fees, as well as facilities and other costs to continue the progression of our research and clinical programs. General and administrative expenses for the quarter and year ended December 31, 2022 were $9.8 million and $36.3 million , respectively, compared to $7.7 million and $31.9 million , respectively, for the same periods in 2021. The increase was primarily due to higher employee-related costs, including stock-based compensation expense, higher consulting and outside services costs to support our operations, and other costs. These increases were partially offset by a decrease in facilities costs. The change in fair value of contingent consideration and contingent value rights liabilities for the quarter and year ended December 31, 2022 resulted in expenses of $7.3 million and $12.0 million , respectively, compared to expenses of $5.8 million and $27.3 million , respectively, for the same periods in 2021. The increase in these non-cash expenses in the quarter ended December 31, 2022 was primarily due to an increase in the fair value of the contingent value rights liability related to the preferred shares in Sairopa mainly as a result of Sairopa entering into a license agreement with Exelixis in November 2022. The decrease in the year ended December 31, 2022 was primarily due to a higher fair value in 2021 that included the impact of earning a milestone payment under the license agreement with Merck. Net Loss – Net loss for the quarter ended December 31, 2022 was $62.6 million , or $0.90 per share, compared to net income of $7.5 million , or $0.15 per basic share for the same period in 2021. Net loss for the year ended December 31, 2022 was $187.9 million , or $2.92 per share, compared to $102.9 million , or $2.26 per share for the same period in 2021. About Chinook Therapeutics, Inc. www.chinooktx.com .
Cautionary Note on Forward-Looking Statements
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CHINOOK THERAPEUTICS, INC. Condensed Consolidated Statements of Operations (In thousands, except per share amounts) (Unaudited) Three Months Ended December 31, Year Ended December 31, 2022 2021 2022 2021 Collaboration and license revenue $ 512 $ 51,236 $ 6,128 $ 51,625 Operating expenses: Research and development 42,952 24,930 141,211 96,987 General and administrative 9,765 7,741 36,291 31,899 Change in fair value of contingent consideration 7,268 5,754 11,987 27,317 Amortization of intangible assets 433 422 1,722 1,687 Total operating expenses 60,418 38,847 191,211 157,890 Gain on sale of assets to equity method investment — — — 7,227 Income (loss) from operations (59,906 ) 12,389 (185,083 ) (99,038 ) Investment and other income (expense), net 2,447 5 4,809 (170 ) Income (loss) before income taxes and equity method (57,459 ) 12,394 (180,274 ) (99,208 ) Income tax expense (4,341 ) (3,297 ) (4,341 ) (2,093 ) Equity method investment loss (754 ) (1,552 ) (3,250 ) (1,636 ) Net income (loss) $ (62,554 ) $ 7,545 $ (187,865 ) $ (102,937 ) Net income (loss) per share attributable to common Basic $ (0.90 ) $ 0.15 $ (2.92 ) $ (2.26 ) Diluted $ (0.90 ) $ 0.14 $ (2.92 ) $ (2.26 ) Weighted-average shares used in computing net Basic 69,217 51,675 64,370 45,607 Diluted 69,217 53,690 64,370 45,607
CHINOOK THERAPEUTICS, INC. Condensed Consolidated Balance Sheets (In thousands) (Unaudited) December 31, December 31, 2022 2021 Assets Current assets: Cash and cash equivalents $ 115,438 $ 181,724 Marketable securities 262,887 105,113 Accounts receivable 1,091 10,061 Prepaid expenses and other current assets 6,176 3,741 Total current assets 385,592 300,639 Marketable securities 6,989 68,215 Property and equipment, net 16,908 18,935 Restricted cash 2,074 2,074 Operating lease right-of-use assets 48,970 55,385 Investment in equity securities 41,200 41,200 Equity method investment 4,071 8,205 Intangible assets, net 24,287 26,009 In-process research & development 36,550 36,550 Goodwill 117 117 Other assets 7,326 6,474 Total assets $ 574,084 $ 563,803 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable $ 9,751 $ 8,580 Accrued and other current liabilities 33,636 17,104 Operating lease liabilities 4,948 4,401 Contingent value rights liability 2,500 10,000 Total current liabilities 50,835 40,085 Contingent value rights liability - non-current 37,318 24,591 Contingent consideration liability 4,420 5,160 Deferred tax liabilities 5,076 735 Operating lease liabilities, net of current maturities 34,494 39,589 Total liabilities 132,143 110,160 Stockholders’ equity 441,941 453,643 Total liabilities and stockholders’ equity $ 574,084 $ 563,803
