Mereo BioPharma Reports Third Quarter 2024 Financial Results and Provides Corporate Update
Rhea-AI Summary
Mereo BioPharma reported Q3 2024 financial results with cash position of $80.5 million, expected to fund operations into 2027. The company's setrusumab received Breakthrough Therapy designation from FDA for osteogenesis imperfecta treatment. Q3 net loss increased to $15.0 million from $6.5 million in Q3 2023, primarily due to foreign exchange losses. R&D expenses decreased 12% to $3.2 million, while G&A expenses increased 9% to $6.2 million. The company continues to advance setrusumab's Phase 3 program with partner Ultragenyx and expects alvelestat to be Phase 3-ready by end of 2024.
Positive
- Strong cash position of $80.5 million providing runway into 2027
- Setrusumab received FDA Breakthrough Therapy designation
- 12% reduction in R&D expenses from $3.6M to $3.2M
Negative
- Net loss increased by $9.2M to $15.0M in Q3 2024
- G&A expenses increased 9% to $6.2M
- Foreign exchange losses of $6.4M in Q3 2024 versus $2.5M gain in Q3 2023
Insights
The Q3 results reveal a strong financial position with
The FDA's Breakthrough Therapy designation for setrusumab significantly enhances the company's market position and potential commercialization prospects. The pipeline progress, particularly with setrusumab's Phase 3 trials and alvelestat becoming Phase 3-ready, indicates strong development momentum. Partnership discussions for alvelestat could provide additional upside through potential milestone payments and commercialization rights.
The Breakthrough Therapy designation for setrusumab represents a significant regulatory milestone, particularly given the absence of approved therapies for osteogenesis imperfecta. The preliminary clinical evidence, including positive 14-month results from the Orbit study showing meaningful fracture rate reduction, validates the drug's potential. The dual regulatory support (FDA Breakthrough and EU PRIME designation) strengthens the likelihood of approval.
The strategic focus on pre-commercial activities in European markets, including HTA discussions and real-world evidence generation through SATURN, demonstrates a well-planned commercialization strategy. Alvelestat's progression toward Phase 3 readiness in AATD lung disease further diversifies the pipeline with another promising rare disease candidate.
Setrusumab receives Breakthrough Therapy designation from the FDA
Cash of
LONDON, Nov. 12, 2024 (GLOBE NEWSWIRE) -- Mereo BioPharma Group plc (NASDAQ: MREO) (“Mereo” or the “Company”), a clinical-stage biopharmaceutical company focused on rare diseases, today announced its financial results for the third quarter ended September 30, 2024, and provided an update on recent corporate highlights. The Company reported cash and cash equivalents of
“The Phase 3 program for setrusumab, led by our partners at Ultragenyx, continues to progress according to plan and we look forward to reporting the topline data during 2025,” said Dr. Denise Scots-Knight, Chief Executive Officer of Mereo. “The recent receipt of Breakthrough Therapy designation from the U.S. FDA follows on from the PRIME designation we obtained in Europe. This reinforces the high unmet medical need for treatments for individuals affected by osteogenesis imperfecta (OI) who currently have no approved therapies, and the potential of setrusumab. Our pre-commercial efforts in our key European markets are progressing well, including the discussions with the HTAs and payors through EUNetHA and scientific advice in the individual countries. We continue to engage in discussions with multiple potential partners regarding the development and commercialization of alvelestat for AATD lung disease. We remain on track for alvelestat to be Phase 3-ready around the end of the year, further solidifying our commitment to bringing innovative treatments to individuals with rare diseases.”
Third Quarter 2024 Highlights, Recent Developments and Anticipated Milestones
Setrusumab (UX143)
- Our partner, Ultragenyx Pharmaceutical Inc., received Breakthrough Therapy Designation from the U.S. Food and Drug Administration (FDA) for setrusumab (UX143) as a treatment to reduce the risk of fracture associated with osteogenesis imperfecta (OI) Type I, III, or IV in patients 2 years of age and older.
- The FDA’s decision was based on preliminary clinical evidence including the positive 14-month results from the Phase 2 portion of the Orbit study, which demonstrated a rapid and clinically meaningful decrease in fracture rate in patients, and from the completed Phase 2b ASTEROID study.
- Led by Ultragenyx, the Companies are actively advancing the Phase 3 Orbit and Cosmic studies of setrusumab in OI.
- The 14-month data from the Phase 2/3 Orbit study were presented by Ultragenyx in a late-breaking oral presentation at the American Society for Bone and Mineral Research (ASBMR) 2024 Annual Meeting.
- A further paper from SATURN (Systematic Accumulation of Treatment practices and Utilization, Real world evidence, and Natural history data for OI), has been published. This is part of the Company’s pre-launch activities designed to generate additional evidence to support coverage, pricing and reimbursement decisions across Europe.
Alvelestat (MPH-966)
- Following the FDA feedback on the detailed Phase 3 package, including the study protocol and the initial validation work on SGRQ in AATD, the Company continues to expect that alvelestat will be Phase 3 ready around the end of 2024.
- The Company remains in discussions with several potential partners regarding the development and commercialization of alvelestat for AATD.
Third Quarter 2024 Financial Results
Total research and development (R&D) expenses decreased by
General and administrative (G&A) expenses increased by
Net loss for the third quarter of 2024 was
As of September 30, 2024, the Company had cash and cash equivalents of
Total ordinary shares issued as of September 30, 2024, were 773,672,299. Total ADS equivalents as of September 30, 2024, were 154,734,459, with each ADS representing five ordinary shares of the Company.
About Mereo BioPharma
Mereo BioPharma is a biopharmaceutical company focused on the development of innovative therapeutics for rare diseases. The Company has two rare disease product candidates, setrusumab for the treatment of osteogenesis imperfecta (OI) and alvelestat primarily for the treatment of severe alpha-1 antitrypsin deficiency-associated lung disease (AATD-LD). The Company’s partner, Ultragenyx Pharmaceutical, Inc., has completed enrollment in the Phase 3 portion of a pivotal Phase 2/3 pediatric study in young adults (5 to 25 years old) for setrusumab in OI and in the Phase 3 study in pediatric patients (2 to <7 years old) in the first half of 2024. The partnership with Ultragenyx includes potential additional milestone payments of up to
Forward-Looking Statements
This press release contains “forward-looking statements” that involve substantial risks and uncertainties. All statements other than statements of historical fact contained herein are forward-looking statements within the meaning of Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities Exchange Act of 1934, as amended. Forward-looking statements usually relate to future events and anticipated revenues, earnings, cash flows or other aspects of our operations or operating results. Forward-looking statements are often identified by the words “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “could,” “may,” “estimate,” “outlook” and similar expressions, including the negative thereof. The absence of these words, however, does not mean that the statements are not forward-looking. These forward-looking statements are based on the Company’s current expectations, beliefs and assumptions concerning future developments and business conditions and their potential effect on the Company. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting the Company will be those that it anticipates.
All of the Company’s forward-looking statements involve known and unknown risks and uncertainties some of which are significant or beyond its control and assumptions that could cause actual results to differ materially from the Company’s historical experience and its present expectations or projections. Such risks and uncertainties include, among others, the uncertainties inherent in the clinical development process; the Company’s reliance on third parties to conduct and provide funding for its clinical trials; the Company’s dependence on enrollment of patients in its clinical trials; and the Company’s dependence on its key executives. You should carefully consider the foregoing factors and the other risks and uncertainties that affect the Company’s business, including those described in the “Risk Factors” section of its Annual Report on Form 10-K, as well as discussions of potential risks, uncertainties, and other important factors in the Company’s subsequent filings with the Securities and Exchange Commission. The Company wishes to caution you not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly update or revise any of our forward-looking statements after the date they are made, whether as a result of new information, future events or otherwise, except to the extent required by law.
Mereo BioPharma Contacts: | ||
| Mereo | +44 (0)333 023 7300 | |
| Denise Scots-Knight, Chief Executive Officer | ||
| Christine Fox, Chief Financial Officer | ||
| Burns McClellan (Investor Relations Adviser to Mereo) | +01 646 930 4406 | |
| Lee Roth | ||
| Investors | investors@mereobiopharma.com | |
| MEREO BIOPHARMA GROUP PLC CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share data) (Unaudited) | ||||||||
| September 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 80,522 | $ | 57,421 | ||||
| Prepaid expenses and other current assets | 3,830 | 5,156 | ||||||
| Research and development incentives receivables | 2,371 | 1,183 | ||||||
| Total current assets | 86,723 | 63,760 | ||||||
| Property and equipment, net | 315 | 405 | ||||||
| Operating lease right-of-use assets, net | 909 | 1,245 | ||||||
| Intangible assets, net | 799 | 1,089 | ||||||
| Total assets | $ | 88,746 | $ | 66,499 | ||||
| Liabilities | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,748 | $ | 2,346 | ||||
| Accrued expenses | 3,529 | 5,467 | ||||||
| Convertible loan notes – current | 5,551 | — | ||||||
| Operating lease liabilities – current | 736 | 652 | ||||||
| Other current liabilities | 2,644 | 1,021 | ||||||
| Total current liabilities | 14,208 | 9,486 | ||||||
| Convertible loan notes – non-current | — | 4,394 | ||||||
| Warrant liabilities – non-current | 1,040 | 412 | ||||||
| Operating lease liabilities – non-current | 394 | 906 | ||||||
| Other non-current liabilities | 568 | 764 | ||||||
| Total liabilities | $ | 16,210 | $ | 15,962 | ||||
| Commitments and contingencies (Note 16) | ||||||||
| Shareholders’ Equity | ||||||||
| Ordinary shares, par value | 3,051 | 2,775 | ||||||
| Treasury shares | — | (1,230 | ) | |||||
| Additional paid-in capital | 536,426 | 486,107 | ||||||
| Accumulated deficit | (455,837 | ) | (419,630 | ) | ||||
| Accumulated other comprehensive loss | (11,104 | ) | (17,485 | ) | ||||
| Total shareholders’ equity | 72,536 | 50,537 | ||||||
| Total liabilities and shareholders’ equity | $ | 88,746 | $ | 66,499 | ||||
| MEREO BIOPHARMA GROUP PLC CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (In thousands, except share and per share amounts) (Unaudited) | ||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Revenue | $ | — | $ | — | $ | — | $ | 9,000 | ||||||||
| Operating expenses: | ||||||||||||||||
| Cost of revenue | — | 235 | — | (2,847 | ) | |||||||||||
| Research and development | (3,170 | ) | (3,594 | ) | (12,109 | ) | (12,614 | ) | ||||||||
| General and administrative | (6,203 | ) | (5,708 | ) | (19,980 | ) | (14,827 | ) | ||||||||
| Loss from operations | (9,373 | ) | (9,067 | ) | (32,089 | ) | (21,288 | ) | ||||||||
| Other income/(expenses) | ||||||||||||||||
| Interest income | 983 | 689 | 2,160 | 1,368 | ||||||||||||
| Interest expense | (353 | ) | (700 | ) | (995 | ) | (2,528 | ) | ||||||||
| Changes in the fair value of warrants | (59 | ) | — | (576 | ) | 440 | ||||||||||
| Foreign currency transaction (loss)/gain, net | (6,425 | ) | 2,465 | (5,780 | ) | 455 | ||||||||||
| Other expenses, net | — | — | — | (6 | ) | |||||||||||
| Benefit from research and development tax credit | 226 | 82 | 1,073 | 1,202 | ||||||||||||
| Net loss before income tax | (15,001 | ) | (6,531 | ) | (36,207 | ) | (20,357 | ) | ||||||||
| Income tax benefit | — | — | — | — | ||||||||||||
| Net loss | $ | (15,001 | ) | $ | (6,531 | ) | $ | (36,207 | ) | $ | (20,357 | ) | ||||
| Loss per share – basic and diluted | $ | (0.02 | ) | $ | (0.01 | ) | $ | (0.05 | ) | $ | (0.03 | ) | ||||
| Weighted average shares outstanding – basic and diluted | 770,146,589 | 684,974,190 | 727,808,860 | 645,997,203 | ||||||||||||
| Net loss | $ | (15,001 | ) | $ | (6,531 | ) | $ | (36,207 | ) | $ | (20,357 | ) | ||||
| Other comprehensive income/(loss) – Foreign currency translation adjustments, net of tax | 7,174 | (3,579 | ) | 6,381 | 99 | |||||||||||
| Total comprehensive loss | $ | (7,827 | ) | $ | (10,110 | ) | $ | (29,826 | ) | $ | (20,258 | ) | ||||
FAQ
What is Mereo BioPharma's (MREO) current cash position as of Q3 2024?
How much did MREO's net loss increase in Q3 2024?
What regulatory designation did setrusumab receive from the FDA in 2024?
How long is MREO's current cash expected to fund operations?
