- Phase 1/2 dose escalation safety and preliminary efficacy of
ANKET® NK cell engager, SAR'579/IPH6101, developed by Sanofi,
showed it was well tolerated with observed clinical benefit in
patients with R/R AML (ASCO 2023 annual meeting), FDA Fast Track
Designation awarded
- Exclusive worldwide rights granted to Takeda to research and
develop antibody drug conjugates (ADC) using a panel of selected
Innate antibodies; $5m upfront payment to Innate and up to $410m in
future milestones plus royalties
- Proprietary ANKET® IPH65 IND approved, progressing to Phase
1
- Proprietary IPH45 ADC target, nectin-4 disclosed
- Innate announces new Chief Medical Officer, Sonia
Quaratino
- Cash position of €124.7 million1 as of June 30, 2023,
anticipated cash runway into H2 2025
- Conference call to be held today at 2:00 p.m. CEST / 8:00
a.m. EDT
Innate Pharma SA (Euronext Paris: IPH; Nasdaq: IPHA)
(“Innate” or the “Company”) today reported its
consolidated financial results for the six months ended June 30,
2023. The consolidated financial statements are attached to
this press release.
“Based on our strong financial position, we continue momentum
with our clinical pipeline and were encouraged by the clinical data
from our first ANKET® NK cell engager, SAR'579/IPH6101 - in
partnership with Sanofi presented at the ASCO 2023 annual meeting.
We look forward to further data readouts in the future from this
and other exciting pipeline projects including on our ADC pipeline,
where we signed a partnership earlier this year with Takeda.
Importantly, already in the second half of this year, we expect to
report final results from our Phase 2 TELLOMAK trial with
lacutamab,” said Mondher Mahjoubi, Chief Executive Officer of
Innate Pharma. ”We have also continued to strengthen the team
at Innate and it is with great pleasure that we welcome Dr. Sonia
Quaratino as Chief Medical Officer. She has outstanding
international industry experience in clinical development,
including in senior roles at leading global pharmaceutical
companies. I would like to thank outgoing Joyson Karakunnel for his
great work in building/shaping the pipeline and the R&D team
during the past years at Innate and wish him well in his future
endeavors.”
Webcast and conference call
will be held today at 2:00 p.m. CEST (8:00 a.m. ET)
Access to live webcast:
https://events.q4inc.com/attendee/859850812
Participants may also join via
telephone by registering in advance of the event at
https://registrations.events/direct/Q4E60903
This information can also be
found on the Investors section of the Innate Pharma website,
www.innate-pharma.com. A replay of the webcast will be available on
the Company website for 90 days following the event.
___________________________
1 Including short term investments (€17.5
million) and non-current financial instruments (€35.8 million)
Pipeline highlights:
Lacutamab (anti-KIR3DL2
antibody):
- Innate continues to see progress for lacutamab with final data
from the TELLOMAK Phase 2 trial for both mycosis fungoides and
Sézary syndrome expected in H2 2023.
- In June 2023, interim efficacy results from the TELLOMAK Phase
2 study in advanced mycosis fungoides (MF) according to updated
lymph node classification were presented at the 17th International
Conference on Malignant Lymphoma, in Lugano, Switzerland. Results
confirm clinical activity and favorable safety profile of
lacutamab. Results showed that lacutamab produced an increased
global objective response rate (ORR) of 42.9% (95% confidence
interval [CI], 24.5-63.5) in patients with KIR3DL2 ≥ 1% MF (cohort
2, n=21), including 2 complete responses and 7 partial
responses.
- Initial PTCL data are expected in H2 2023. Two parallel
clinical trials to study lacutamab in patients with
KIR3DL2-expressing, relapsed/refractory peripheral T-cell lymphoma
(PTCL) are ongoing.
ANKET® (Antibody-based NK cell Engager
Therapeutics):
ANKET® is Innate’s proprietary platform for developing
next-generation, multi-specific NK cell engagers to treat certain
types of cancer. Innate’s pipeline includes four public drug
candidates born from the ANKET® platform: SAR’579 / IPH6101
(CD123-targeted), SAR’514 / IPH6401 (BCMA-targeted), IPH62
(B7-H3-targeted) and tetra-specific IPH65 (CD20-targeted). Several
other undisclosed proprietary preclinical targets are being
explored.
SAR’579 / IPH6101, SAR’514 / IPH6401 and IPH62 (partnered
with Sanofi)
SAR’579 / IPH6101
- The Phase 1/2 clinical trial by Sanofi is progressing well,
evaluating SAR’579 / IPH6101, a trifunctional anti-CD123
NKp46×CD16 NK cell engager and ANKET® platform lead asset, in
patients with relapsed or refractory acute myeloid leukemia (AML),
B-cell acute lymphoblastic leukemia (B-ALL) or high-risk
myelodysplastic syndrome (HR-MDS).
- Phase 1/2 dose escalation safety and preliminary efficacy of
SAR'579 / IPH6101 in R/R AML, B-ALL and HR-MDS were presented
during an oral presentation at the ASCO (American Society for
Clinical Oncology) 2023 Annual Meeting in June. Preliminary data
showed SAR’579 / IPH6101 was well tolerated and induced 3 complete
responses in the 8 patients at 1 mg/kg as highest dose.
- In June, SAR’579 / IPH6101 received U.S. Food and Drug
Administration (FDA) Fast Track Designation for the treatment of
hematological malignancies.
- Preclinical data showing the control of AML cells by a
trifunctional NKp46-CD16a-NK cell engager targeting CD123 were
published in Nature Biotechnology in January 2023.
SAR’514 / IPH6401
- In July 2023, partner Sanofi advanced SAR’514 / IPH6401,
a trifunctional anti-BCMA Nkp46xCD16 NK cell engager, to
first-in-human clinical trial in Relapsed/Refractory Multiple
Myeloma (RRMM) and Relapsed/Refractory Light-chain Amyloidosis
(RRLCA)
- Our partner presented preclinical data showing SAR’514 /
IPH6401 has potent in-vitro, in-vivo and ex-vivo anti-myeloma
effect through dual NK cell engagement in a poster at the American
Association for Cancer Research (AACR) 2023 in April.
IPH62
- As announced on December 19, 2022, Sanofi licensed IPH62, a NK
cell engager program targeting B7-H3 from Innate’s ANKET® platform,
and the company has the option to add up to two additional ANKET®
targets. Upon candidate selection, Sanofi will be responsible for
all development, manufacturing and commercialization. Under the
terms of the agreement, Innate received a €25m upfront payment and
is eligible for up to €1.35bn total in preclinical, clinical,
regulatory and commercial milestones plus royalties on potential
net sales.
IPH65 (proprietary)
- Following approval of the IND-filing by the FDA in July 2023,
IPH65, Innate’s proprietary CD20 targeted tetra-specific ANKET®
continues toward a Phase 1 clinical trial in 2023.
- Updated preclinical data on IPH65 were presented at the
European Hematology Association (EHA) 2023 congress in June.
Monalizumab (anti-NKG2A antibody),
partnered with AstraZeneca:
- Innate continues to see progress for monalizumab in the early
non-small cell lung cancer (NSCLC) setting, with the ongoing Phase
3 PACIFIC-9 study run by AstraZeneca. The study is evaluating
durvalumab (anti-PD-L1) in combination with monalizumab or
AstraZeneca’s oleclumab (anti-CD73) in patients with unresectable,
Stage III NSCLC who have not progressed following definitive
platinum-based concurrent chemoradiation therapy (CRT).
- Monalizumab was highlighted in two “Trial in progress” posters
at the ASCO 2023 Annual Meeting in June:
- Phase 3 study of durvalumab combined with oleclumab or
monalizumab in patients with unresectable stage III NSCLC
(PACIFIC-9).
- NeoCOAST-2: A Phase 2 study of neoadjuvant durvalumab plus
novel immunotherapies (IO) and chemotherapy (CT) or MEDI5752
(volrustomig) plus CT, followed by surgery and adjuvant durvalumab
plus novel IO or volrustomig alone in patients with resectable
non-small-cell lung cancer (NSCLC).
IPH5201 (anti-CD39), partnered with
AstraZeneca:
- In June 2023, the first patient was dosed in the MATISSE Phase
2 clinical trial conducted by Innate in neoadjuvant lung cancer for
IPH5201, an anti-CD39 blocking monoclonal antibody developed in
collaboration with AstraZeneca.
IPH5301 (anti-CD73):
- The investigator-sponsored CHANCES Phase 1 trial of IPH5301
with Institut Paoli-Calmettes is ongoing.
Antibody Drug
Conjugates:
- Fueling its R&D engine, the Company continues to develop
different approaches for the treatment of cancer utilizing its
antibody engineering capabilities to deliver novel assets, with its
innovative ANKET® platform and continuing to explore Antibody Drug
Conjugates (ADC) formats.
Takeda license agreement:
- In April 2023, Innate announced that it has entered into an
exclusive license agreement with Takeda under which Innate grants
Takeda exclusive worldwide rights to research and develop antibody
drug conjugates (ADC) using a panel of selected Innate antibodies
against an undisclosed target, with a primary focus in Celiac
disease. Under the terms of the license agreement, Innate received
a $5m upfront payment and is eligible to receive up to $410m in
future development, regulatory and commercial milestones if all
milestones are achieved during the term of the agreement, plus
royalties on potential net sales of any commercial product
resulting from the license.
IPH45 (nectin-4 ADC):
- Innate’s proprietary nectin-4 targeted antibody drug conjugate,
IPH45 continues toward a Phase 1 clinical trial.
Corporate Update:
- On April 26, Innate announced the establishment of a new
At-The-Market (ATM) program, pursuant to which it may, from time to
time, offer and sell to eligible investors a total gross amount of
up to $75 million American Depositary Shares (“ADS”). Each ADS
representing one ordinary share of Innate.
- Dr. Sonia Quaratino, MD, PhD, will join Innate Pharma as
Executive Vice President and Chief Medical Officer, effective
October 2023. Dr. Sonia Quaratino succeeds to Dr. Karakunnel who is
leaving the Company to pursue other challenges. Dr. Quaratino
brings over 25 years of experience in basic research, clinical
development, and translational medicine, having worked in academia,
global large pharmaceuticals, and biotechs. Recently, Dr. Quaratino
was Chief Medical Officer at Georgiamune INC.(USA) and prior to
that she was Chief Medical Officer at Kymab (UK), a clinical-stage
biopharmaceutical company with a focus on immune-mediated diseases
and immuno-oncology, acquired by Sanofi in 2021. Previously, she
held roles at Novartis (Switzerland) and Merck Serono (Germany),
and was Professor of Immunology in UK at the University of
Southampton. Her research has been published in high impact
scientific journals.
Financial highlights for the first half of 2023:
The key elements of Innate’s financial position and financial
results as of and for the six-month period ended June 30, 2023 are
as follows:
- Cash, cash equivalents, short-term investments and financial
assets amounting to €124.7 million (€m) as of June 30, 2023
(€136.6m as of December 31, 2022).
- Revenue and other income from continuing operations amounted to
€40.2m in the first half of 2023 (€45.6m in the first half of 2022)
and mainly comprise of:
- Revenue from collaboration and licensing agreements, which
mainly resulted from the partial or entire recognition of the
proceeds received pursuant to the agreements with AstraZeneca,
Sanofi and Takeda. They results from the partial or entire
recognition of the proceeds received pursuant to the agreements
with AstraZeneca, Sanofi and Takeda. They are recognized when the
entity's performance obligation is met. Their accounting is made at
a point in time or spread over time according to the percentage of
completion of the work that the Company is committed to carry out
under these agreements:
- (i) Revenue from collaboration and licensing agreements for
monalizumab decreased by €6.9m to €9.5m in the first half of 2023
(€16.4m in the first half of 2022). This change mainly results from
the transaction price increase of €13.4 million ($14.0 million) in
the first half of 2022, triggered by the launch of the “PACIFIC-9”
Phase 3 trial on April 28, 2022. As a reminder, this increase in
the transaction price led to the recognition of an additional
revenue of €12.5 million for the first half of 2022. However, this
decrease is partially offset by an increase in monalizumab-related
revenues for the first half of 2023, in line with the progress of
Phase 1/2 trials over the period.
- (ii) Revenue related to the license and collaboration agreement
signed with Sanofi in 2016 decreased by €1.0m, to €2.0m for the six
months ended June 30, 2023, as compared to €3.0m for the six months
ended June 30, 2022. The Company announced that, in June 2023, the
first patient was dosed in a Sanofi-sponsored Phase 1/2 clinical
trial evaluating SAR'514/IPH6401 in relapsed or refractory Multiple
Myeloma. As provided by the licensing agreement signed in 2016,
Sanofi made a milestone payment of €2.0 million, fully recognized
in revenue as of June 30, 2023. This amount was received by the
Company on July 21, 2023. As a reminder, the revenue recognized in
the first half of 2022 resulted from Sanofi's decision to advance
SAR'514/IPH6401 into investigational new drug (IND)-enabling
studies. As such, Sanofi had selected a second multispecific
antibody engaging NK cells as a drug candidate. This selection
triggered a €3.0 million milestone payment from Sanofi to the
Company, fully recognized in revenue as of June 30, 2022.
- (iii) Revenue of €18.7 million related to the research
collaboration and licensing agreement signed with Sanofi in 2022.
On January 25, 2023, the Company announced the expiration of the
waiting period under the Hart-Scott-Rodino (HSR) Antitrust
Improvements Act of 1976 and the effectiveness of the licensing
agreement as of January 24, 2023. Consequently, the Company
received an upfront payment of €25.0 million in March 2023,
including €18.5 million for the exclusive license, €1.5 million for
the research work and €5.0 million for the two additional targets
options. The €18.5 million upfront payment relating to the
exclusive license has been fully recognized in revenue as of June
30, 2023. The €1.5 million upfront payment will be recognized on a
straight-line basis over the duration of the research work that the
Company has agreed to carry out. The €5.0 million initial payment
relating to the options is recognized in deferred
revenue—non-current portion as of June 30, 2023. The Company will
recognize the related revenues either at the reporting date or
three years after the effective date.
- (iv) Revenue of €4.6m related to the licensing agreement signed
with Takeda in 2023. On April 3, 2023, the Company announced that
it has entered into an exclusive license agreement with Takeda
under which Innate grants Takeda exclusive worldwide rights to
research and develop antibody drug conjugates (ADC) using a panel
of selected Innate antibodies against an undisclosed target, with a
primary focus in Celiac disease. Takeda will be responsible for the
future development, manufacture and commercialization of any
potential products developed using the licensed antibodies. As
such, the Company considers that the license granted is a right to
use the intellectual property, which is granted fully and
perpetually to Takeda. The agreement does not stipulate that
Innate's activities will significantly affect the intellectual
property granted during the life of the agreement. Consequently,
the $5.0 million (or €4.6 million) initial payment, received by the
Company in May 2023, was fully recognized in revenue as of June 30,
2023.
- Government funding for research expenditures of €4.9m in the
first half of 2023 (€4.3m in the first half of 2022).
- Operating expenses from continuing operations are €40.6m in the
first half of 2023 (€37.1m in the first half of 2022), of which
77.5% (€31.5m) are related to R&D.
- R&D expenses from continuing operations increased by €6.5m
to €31.5m in the first half of 2023 (€25.0m in the first half of
2022). This change mainly results from (i) a €4.9m increase in
direct R&D expenses relating to €4.8m non-clinical program in
the Antibody Drug Conjugates (ADC) field and a slight increase of
clinical programs of €0.1m; (ii) Personnel expenses and other
R&D expenses increased by €1.6m (12.9%) to reach €14.2m in the
first half 2023 compared to €12.6m in the first half 2022. This
increase is mainly explained by €2.0m amortization for the rights
relating to IPH5201 following the first patient dosed in the Phase
2 MATISSE clinical trial. The amortization of rights related to the
monalizumab decreased by €0.3m.
- General and administrative (G&A) expenses from continuing
operations decreased by €3.0m to €9.1m in the first half of 2023
(€12.1m in the first half of 2022) mainly resulting from ((i) a
€1.4m decrease of personnel expenses mainly due to a reduction of
administrative workforce, (ii) a €0.6m decrease on non-scientific
advisory and consulting fees (limited use of recruitment agencies
and strategic consulting), and finally (iii) a decrease on other
expenses for €1.0m mainly related to a decrease on leasing and
maintenance for €0.5m to the benefit of research and development
enabling a more consistent allocation of support expenses to the
company's research laboratory as well as a reduction of 0.2 million
following more limited use of external communication and investor
relations service providers.
- Net income from discontinued operations related to Lumoxiti are
nil compared to a net loss of €0.1 million for the first half of
2022 corresponding to residual costs associated with the transfer
of activities to AstraZeneca. This transfer has now been
completed.
- A net financial gain of €2.1m in the first half of 2023 (net
financial loss of €2.1m in the first half of 2022), principally as
a result of the increase in fair value of certain of our financial
instruments and net foreign exchange gain over the period.
- A net income of €1.7m for the first half of 2023 (net income of
€6.3m for the first half of 2022).
The table below summarizes the IFRS consolidated financial
statements as of and for the six months ended June 30, 2023,
including 2022 comparative information.
In thousands
of euros, except for data per share
June
30, 2023
June
30, 2022
Revenue and other income
40,198
45,589
Research and development expenses
(31,453)
(24,956)
General and administrative expenses
(9,144)
(12,140)
Operating expenses
(40,597)
(37,096)
Operating income (loss)
(398)
8,494
Net financial income (loss)
2,116
(2,118)
Income tax expense
—
—
Net income (loss) from continuing
operations
1,718
6,376
Net income (loss) from discontinued
operations
—
(73)
Net income (loss)
1,718
6,303
Weighted average number of shares ( in
thousands) :
80,320
79,754
- Basic income (loss) per share
0.02
0.08
- Diluted income (loss) per share
0.02
0.08
- Basic income (loss) per share from
continuing operations
0.02
0.08
- Diluted income (loss) per share from
continuing operations
0.02
0.08
- Basic income (loss) per share from
discontinued operations
—
—
- Diluted income (loss) per share from
discontinued operations
—
—
June
30, 2023
December 31, 2022
Cash, cash equivalents and financial
assets
124,679
136,604
Total assets
199,049
207,863
Total shareholders’ equity
57,863
54,151
Total financial debt
40,658
42,251
About Innate Pharma:
Innate Pharma S.A. is a global, clinical-stage biotechnology
company developing immunotherapies for cancer patients. Its
innovative approach aims to harness the innate immune system
through therapeutic antibodies and its ANKET®
(Antibody-based NK cell Engager
Therapeutics) proprietary platform.
Innate’s portfolio includes lead proprietary program lacutamab,
developed in advanced form of cutaneous T cell lymphomas and
peripheral T cell lymphomas, monalizumab developed with AstraZeneca
in non-small cell lung cancer, as well as ANKET® multi-specific NK
cell engagers to address multiple tumor types.
Innate Pharma is a trusted partner to biopharmaceutical
companies such as Sanofi and AstraZeneca, as well as leading
research institutions, to accelerate innovation, research and
development for the benefit of patients.
Headquartered in Marseille, France with a US office in
Rockville, MD, Innate Pharma is listed on Euronext Paris and Nasdaq
in the US.
Learn more about Innate Pharma at www.innate-pharma.com
Information about Innate Pharma shares:
ISIN code
Ticker code
LEI
FR0010331421
Euronext: IPH Nasdaq: IPHA
9695002Y8420ZB8HJE29
Disclaimer on forward-looking information and risk
factors:
This press release contains certain forward-looking statements,
including those within the meaning of the Private Securities
Litigation Reform Act of 1995. The use of certain words, including
“believe,” “potential,” “expect” and “will” and similar
expressions, is intended to identify forward-looking statements.
Although the company believes its expectations are based on
reasonable assumptions, these forward-looking statements are
subject to numerous risks and uncertainties, which could cause
actual results to differ materially from those anticipated. These
risks and uncertainties include, among other things, the
uncertainties inherent in research and development, including
related to safety, progression of and results from its ongoing and
planned clinical trials and preclinical studies, review and
approvals by regulatory authorities of its product candidates, the
Company’s commercialization efforts, the Company’s continued
ability to raise capital to fund its development. For an additional
discussion of risks and uncertainties which could cause the
company's actual results, financial condition, performance or
achievements to differ from those contained in the forward-looking
statements, please refer to the Risk Factors (“Facteurs de Risque")
section of the Universal Registration Document filed with the
French Financial Markets Authority (“AMF”), which is available on
the AMF website http://www.amf-france.org or on Innate Pharma’s
website, and public filings and reports filed with the U.S.
Securities and Exchange Commission (“SEC”), including the Company’s
Annual Report on Form 20-F for the year ended December 31, 2022,
and subsequent filings and reports filed with the AMF or SEC, or
otherwise made public, by the Company.
This press release and the information contained herein do not
constitute an offer to sell or a solicitation of an offer to buy or
subscribe to shares in Innate Pharma in any country.
Summary of Interim Condensed Consolidated
Financial Statements and Notes as of JUNE 30, 2023
Interim Condensed Consolidated
Statements of Financial Position (in thousand euros)
June 30, 2023
December 31, 2022
Assets
Current assets
Cash and cash equivalents
71,414
84,225
Short-term investments
17,475
17,260
Trade receivables and others
55,566
38,346
Total current assets
144,455
139,831
Non-current assets
Intangible assets
903
1,556
Property and equipment
7,262
8,542
Non-current financial assets
35,790
35,119
Other non-current assets
86
149
Trade receivables and others -
non-current
880
14,099
Deferred tax asset
9,674
8,568
Total non-current assets
54,594
68,033
Total assets
199,049
207,863
Liabilities
Current liabilities
Trade payables and others
18,991
20,911
Collaboration liabilities – current
portion
6,538
10,223
Financial liabilities – current
portion
5,335
2,102
Deferred revenue – current portion
5,050
6,560
Provisions - current portion
1,753
1,542
Total current liabilities
37,667
41,338
Non-current liabilities
Collaboration liabilities – non-current
portion
49,520
52,988
Financial liabilities – non-current
portion
35,323
40,149
Defined benefit obligations
2,532
2,550
Deferred revenue – non-current portion
5,974
7,921
Provisions - non-current portion
494
198
Deferred tax liabilities
9,674
8,568
Total non-current liabilities
103,518
112,374
Shareholders’ equity
Share capital
4,027
4,011
Share premium
381,371
379,637
Retained earnings
(330,315
)
(272,213
)
Other reserves
1,064
819
Net income (loss)
1,718
(58,103
)
Total shareholders’ equity
57,863
54,151
Total liabilities and shareholders’
equity
199,049
207,863
Interim Condensed Consolidated
Statements of Income (loss) (in thousand euros)
June 30, 2023
June 30, 2022
Revenue from collaboration and licensing
agreements
35,344
41,271
Government financing for research
expenditures
4,854
4,319
Revenue and other income
40,198
45,589
Research and development expenses
(31,453
)
(24,956
)
General and administrative expenses
(9,144
)
(12,140
)
Operating expenses
(40,597
)
(37,096
)
Operating income (loss)
(398
)
8,494
Financial income
3,083
4,048
Financial expenses
(966
)
(6,166
)
Net financial income (loss)
2,116
(2,118
)
Net income (loss) before tax
1,718
6,376
Income tax expense
—
—
Net income (loss) from continuing
operations
1,718
6,376
Net income (loss) from discontinued
operations
—
(73
)
Net income (loss)
1,718
6,303
Weighted average number of shares : (in
thousands)
80,320
79,754
- Basic income (loss) per share
0.02
0.08
- Diluted income (loss) per share
0.02
0.08
- Basic income (loss) per share from
continuing operations
0.02
0.08
- Diluted income (loss) per share from
continuing operations
0.02
0.08
- Basic income (loss) per share from
discontinued operations
—
—
- Diluted income (loss) per share from
discontinued operations
—
—
Interim Condensed Consolidated
Statements of Cash Flow
(in thousand euros)
June 30, 2023
June 30, 2022
Net income (loss)
1,718
6,303
Depreciation and amortization, net
3,645
2,030
Employee benefits costs
83
192
Change in provision for charges
507
134
Share-based compensation expense
1,401
2,596
Change in valuation allowance on financial
assets
(1,044
)
2,255
Gains (losses) on financial assets
288
(1,333
)
Change in valuation allowance on financial
instruments
(130
)
(100
)
Gains on assets and other financial
assets
—
(25
)
Interest paid
—
194
Disposal of property and equipment
(scrapping)
591
—
Other profit or loss items with no cash
effect
6
(52
)
Operating cash flow before change in
working capital
7,065
12,194
Change in working capital
(18,530
)
(10,976
)
Net cash generated from / (used in)
operating activities:
(11,465
)
1,218
Acquisition of property and equipment,
net
(309
)
(420
)
Disposal of other assets
66
—
Purchase of other assets
(3
)
(1
)
Interest received on financial assets
—
25
Net cash generated from / (used in)
investing activities:
(246
)
(395
)
Proceeds from the exercise / subscription
of equity instruments
348
192
Repayment of borrowings
(1,594
)
(958
)
Net interest paid
—
(194
)
Net cash generated / (used in) from
financing activities:
(1,246
)
(960
)
Effect of the exchange rate changes
145
(670
)
Net increase / (decrease) in cash and
cash equivalents:
(12,811
)
(807
)
Cash and cash equivalents at the beginning
of the year:
84,225
103,756
Cash and cash equivalents at the end of
the six-months period:
71,414
102,949
Revenue and other income
The following table summarizes operating revenue for the periods
under review:
In thousands of euros
June 30, 2023
June 30, 2022
Revenue from collaboration and licensing
agreements
35,344
41,271
Government funding for research
expenditures
4,854
4,319
Revenue and other income
40,198
45,589
Revenue from collaboration and licensing agreements
Revenue from collaboration and licensing agreements decreased by
€5.9 million, to €35.3 million for the six months ended June 30,
2023, as compared to revenues from collaboration and licensing
agreements of €41.3 million for the six months ended June 30, 2022.
These revenues mainly result from the partial or entire recognition
of the proceeds received pursuant to the agreements with
AstraZeneca, Sanofi and Takeda. They are recognized when the
entity's performance obligation is met. Their accounting is made at
a point in time or spread over time according to the percentage of
completion of the work that the Company is committed to carry out
under these agreements.
The evolution for the first half of 2023 is mainly due to:
- A €6.9 million decrease in revenue related to monalizumab, to
€9.5 million for the six months ended June 30, 2023, as compared to
€16.4 million for the six months ended June 30, 2022. This change
mainly results from the transaction price increase of €13.4 million
($14.0 million) in the first half of 2022, triggered by the launch
of the “PACIFIC-9” Phase 3 trial on April 28, 2022. As a reminder,
this increase in the transaction price led to the recognition of an
additional revenue of €12.5 million for the first half of 2022.
However, this decrease is partially offset by an increase in
monalizumab-related revenues for the first half of 2023, in line
with the progress of Phase 1/2 trials over the period. As of June
30, 2023, the deferred revenue related to monalizumab is €4.7
million entirely classified as “Deferred revenue—Current portion”
in connection with the maturity of Phase 1/2 trials.
- A €4.8 million decrease in revenue related to IPH5201 which are
nil for the six months ended June 30, 2023 . The revenue for the
first half of 2022 resulted from the entire recognition in revenue
of the $5.0 million milestone payment received from AstraZeneca
following the signature on June 1, 2022 of an amendment to the
initial contract signed in October 2018. As a reminder, this
amendment sets the terms of the collaboration following
AstraZeneca’s decision to advance IPH5201 to a Phase 2 study. The
Company conducts the study. Both parties share the external cost
related to the study and incurred by the Company and AstraZeneca
provides products necessary to conduct the clinical trial.
- As a reminder, during the first half of 2022, AstraZeneca
informed the Company that it will not exercise its option to
license the four preclinical programs covered in the "Future
Programs Option Agreement". This option agreement was part of the
2018 multi-term agreement between AstraZeneca and the Company under
which the Company received an upfront payment of $20.0 million
(€17.4 million). Innate has regained full rights to further develop
the four preclinical molecules. Consequently, the entire initial
payment of $20.0 million, or €17.4 million was recognized as
revenue as of June 30, 2022.
- The recognition of €18.7 million in revenue as of June 30,
2023, relating to the research collaboration and licensing
agreement signed with Sanofi in 2022. On January 25, 2023, the
Company announced the expiration of the waiting period under the
Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976 and the
effectiveness of the licensing agreement as of January 24, 2023.
Consequently, the Company received an upfront payment of €25.0
million in March 2023, including €18.5 million for the exclusive
license, €1.5 million for the research work and €5.0 million for
the two additional targets options. The Company considers that the
license to the B7-H3 technology is a right to use the intellectual
property granted exclusively to Sanofi from the effective date of
the agreement. As such, the €18.5 million upfront payment relating
to the exclusive license has been fully recognized in revenue as of
June 30, 2023. The Company will provide collaborative research
services to Sanofi for a three years period from the effective date
of the collaboration, i.e. January 24, 2023. Consequently, the
corresponding upfront payment of €1.5 million will be recognized on
a straight-line basis over the duration of the research work that
the Company has agreed to carry out. As a result, a €0.2 million
has been recognized in revenue as of June 30, 2023, and amounts not
recognized in revenue are classified as deferred revenue—current
portion for €0.4 million and deferred revenue—non-current portion
for €0.9 million. Under the terms of this agreement, the Company
has also granted two exclusive options, exercisable no later than
three years after the effective date, for exclusive licenses to
Innate's intellectual property for the research, development,
manufacture and commercialization of NKCEs specifically targeting
two preclinical molecules. The Company considers that the option to
acquire an exclusive license provide a material right to Sanofi
that it would not receive without entering into this agreement. The
Company will recognize the related revenues either at the reporting
date or three years after the effective date. Consequently, the
€5.0 million initial payment relating to these options is
recognized in deferred revenue—non-current portion as of June 30,
2023.
- The recognition of €4.6 million in revenue from licensing
agreement signed with Takeda in 2023. On April 3, 2023, the Company
announced that it has entered into an exclusive license agreement
with Takeda under which Innate grants Takeda exclusive worldwide
rights to research and develop antibody drug conjugates (ADC) using
a panel of selected Innate antibodies against an undisclosed
target, with a primary focus in Celiac disease. Takeda will be
responsible for the future development, manufacture and
commercialization of any potential products developed using the
licensed antibodies. As such, the Company considers that the
license granted is a right to use the intellectual property, which
is granted fully and perpetually to Takeda. The agreement does not
stipulate that Innate's activities will significantly affect the
intellectual property granted during the life of the agreement.
Consequently, the $5.0 million (or €4.6 million) initial payment,
received by the Company in May 2023, was fully recognized in
revenue as of June 30, 2023.
- A €1.0 million decrease in revenue from collaboration and
research license agreement signed with Sanofi in 2016, to €2.0
million for the six months ended June 30, 2023, as compared to €3.0
million for the six months ended June 30, 2022. The Company
announced that, in June 2023, the first patient was dosed in a
Sanofi-sponsored Phase 1/2 clinical trial evaluating
SAR'514/IPH6401 in relapsed or refractory Multiple Myeloma. As
provided by the licensing agreement signed in 2016, Sanofi made a
milestone payment of €2.0 million, fully recognized in revenue as
of June 30, 2023. This amount was received by the Company on July
21, 2023. As a reminder, the revenue recognized in the first half
of 2022 resulted from Sanofi's decision to advance SAR'514/IPH6401
into investigational new drug (IND)-enabling studies. As such,
Sanofi had selected a second multispecific antibody engaging NK
cells as a drug candidate. This selection triggered a €3.0 million
milestone payment from Sanofi to the Company, fully recognized in
revenue as of June 30, 2022. This amount was received by the
Company on September 9, 2022.
- A €0.6 million increase in revenue from invoicing of research
and development costs. The change between the two periods is mainly
explained by the increase in research and development costs
incurred by the Company under these agreements during the first
half of 2023 in line with the clinical trial progress.
Government funding for research expenditures
Government financing for research expenditures increased by €0.5
million, or 12.4%, to €4.9 million for the six months ended June
30, 2023 as compared to €4.3 million the six months ended June 30,
2022. This change is primarily a result of a increase in the
research tax credit of €0.6 million, which is mainly due to (i) the
increase in depreciation on IPH5201 rights following the full
amortization of the additional payment of €2.0 million due to Orega
Biotech following the dosing of the first patient in the Phase 2
MATISSE clinical trial, and (ii) the absence of grants recognized
during the first half of 2023 as compared to the remaining Force
financing of €0,7 million received in the first half of 2022 from
BPI following the technical and commercial failure of the project
based on the results of the Phase 2 "Force" trial evaluating
avdoralimab in COVID-19. However, these decreases are partially
offset by a decrease in public and private R&D subcontracting
expenses eligible due to the maturity of clinical trials and the
non-inclusion, as a precautionary measure, of subcontracting
expenses with a supplier whose agreement is in the process of being
renewed as of June 30, 2023. In addition, this decrease is also
explained by the decrease in amortization of the monalizumab
intangible asset due to the extension of the amortization period,
as well as for certain tangible assets which had reached the end of
their amortization period, and also by lower R&D personnel
costs
The Company met again the SME status under European Union
criteria since December 31, 2020. As such, it was eligible for the
early repayment by the French treasury of the 2021 Research Tax
Credit for an amount of €10.3 million in 2022 and also the 2022
Research Tax Credit for an amount of €9.2 million. These amounts
was received by the Company on November 16,2022 and July 21, 2023,
respectively.
Operating expenses
The table below presents our operating expenses from continuing
operations for the six months periods ended June 30, 2023 and
2022:
In thousands of euros
June 30, 2023
June 30, 2022
Research and development expenses
(31,453
)
(24,956
)
General and administrative expenses
(9,144
)
(12,140
)
Operating expenses
(40,597
)
(37,096
)
Research and development expenses
Research and development (“R&D”) expenses from continuing
operations increased by €6.5 million, or 26.0%, to €31.5 million
for the six months ended June 30, 2023, as compared to €25.0
million for the six months ended June 30, 2022, representing a
total of 77.5% and 67.3% of the total operating expenses,
respectively. R&D expenses include direct R&D expenses
(subcontracting costs and consumables), depreciation and
amortization, and personnel expenses.
Direct R&D expenses increased by €4.9 million, or 39.4%, to
€17.3 million for the six months ended June 30, 2023, as compared
to €12.4 million for the six months ended June 30, 2022. This
increase is mainly explained by €4.8 million non-clinical program
in the Antibody Drug Conjugates – ADC field and a slight increase
of clinical programs of €0.1 million. The increase of €0.9 million
on IPH5201 is linked to startup costs of Phase 2 MATISSE clinical
trial and is partly offset by the decrease expenses related to
lacutamab program for €0.2 million as well as avdoralimab and
monalizumab programs for respectively 0.2 million euros and 0.2
million euros. These decreases follow the decision taken by the
Company at the end of the first half of 2020 to stop recruitment in
trials evaluating avdoralimab in oncology and the maturity of Phase
1/2 clinical trials entering the scope of the collaboration with
AstraZeneca regarding monalizumab.
Also, as of June 30, 2023, the collaboration liabilities
relating to monalizumab and the agreements signed with AstraZeneca
in April 2015, October 2018 and September 2020 amounted to €56.1
million, as compared to collaborations liabilities to €63.2 million
as of December 31, 2022. This decrease of €7.2 million mainly
results from (i) the net reimbursement of €6.4 million made in the
first half 2023 to AstraZeneca relating to the co-financing of the
monalizumab program, mainly including the Phase 3 INTERLINK-1 trial
launched in October 2020 and (ii) the decrease in the collaboration
commitment for the amount of €1.1 million in connection with the
observed exchange rate fluctuations over the period for the
euro-dollar parity.
Personnel and other expenses allocated to R&D increased by
€1.6 million, or 12.9%, to €14.2 million for the six months ended
June 30, 2023, as compared to an amount of €12.6 million for the
six months ended June 30, 2022. This increase is mainly due to €2.0
million amortization for the rights relating to IPH5201 following
the first patient dosed in the Phase 2 MATISSE clinical trial. The
amortization of rights related to the monalizumab is decreasing by
€0.3 million.
General and administrative expenses
General and administrative expenses from continuing activities
decreased by €3.0 million, or 24.7%, to €9.1 million for the six
months ended June 30, 2023, as compared to general and
administrative expenses of €12.1 million for the six months ended
June 30, 2022. General and administrative expenses represented a
total of 22.5% and 32.7% of the total operating expenses for the
six months ended June 30, 2023 and 2022, respectively.
Personnel expense includes the compensation paid to our
employees, and decreased by €1.4 million, to €4.4 million for the
six months ended June 30, 2023, as compared to €5.8 million for six
months ended June 30, 2022. This decrease of €1.4 million is mainly
due to a reduction of administrative workforce.
Non-scientific advisory and consulting expenses mostly consist
of auditing, accounting, taxation and legal fees as well as
consulting fees in relation to business strategy and operations and
hiring services. Non-scientific advisory and consulting expenses
decreased by €0.6 million, or 25.9%, to €1.7 million for the six
months ended June 30, 2023 as compared to €2.2 million for the six
months ended June 30, 2022. This decrease is mainly due to the
decrease in fees in connection with a limited use of recruitment
agencies and strategic consulting in first half 2023 compared to
first half 2022.
The fall in other expenses of €1.0 million mainly results from a
decrease on leasing and maintenance for €0.5 million for the
benefit of research and development enabling a more consistent
allocation of support expenses to the company's research laboratory
as well as a decrease of €0.2 million on external communication and
investor relations service providers.
Financial income (loss),
net
We recognized a net financial income of €2.1 million in the six
months ended June 30, 2023 as compared to a net financial loss of
€2.1 million in the six months ended June 30, 2022. This variance
mainly results from the variance in fair value of our financial
instruments (net gain of €1.0 million for the six months ended June
30, 2023 as compared to a net loss of €2.3 million for the six
months ended June 30, 2022) and a net foreign exchange gain of €0.4
million for the first half of 2023 as compared to a net foreign
exchange gain of €0.1 million for the first half of 2022.
Net loss from discontinued
operations
As a reminder, a Termination and Transition Agreement was
negotiated and executed, effective as of June 30, 2021 further to
the Company's decision to return the rights of Lumoxiti back to
AstraZeneca. Consecutively, activities related to Lumoxiti are
presented as discontinued operations since October 1, 2021.
Thus, the net income from discontinued operations related to
Lumoxiti are nil compared to a net loss of €0.1 million for the
first half of 2022 corresponding to residual costs associated with
the transfer of activities to AstraZeneca. This transfer has now
been completed.
Balance sheet items
Cash, cash equivalents, short-term investments and non-current
financial assets amounted to €124.7 million as of June 30, 2023, as
compared to €136.6 million as of December 31, 2022. Net cash as of
June 30, 2023 amounted to €83.6 million (€99.4 million as of
December 31, 2022). Net cash is equal to cash, cash equivalents and
short-term investments less current financial liabilities.
The Company also has bank borrowings of €39.6m, including €28.7m
of State Guaranteed Loans (“Prêts Garantis par l’Etat”) as of June
30, 2023, and €1.1m of lease liabilities.
The other key balance sheet items as of June 30, 2023 are:
- Deferred revenue of €11.0 million (including €6.0 million
booked as ‘Deferred revenue – non-current portion’) and
collaboration liabilities of €56.1 million (including €49.5 million
booked as ‘Collaboration liabilities - non-current portion’)
relating to the remainder of the initial payment received from
AstraZeneca not yet recognized as revenue or used as part of the
co-financing of the monalizumab program with AstraZeneca;
- Receivables from the French government amounting to €43.9
million in relation to the research tax credit for 2019, 2020, 2022
and the six-month period ended June 30, 2023;
- Shareholders’ equity of €57.9 million, including the net income
of the period of €1.7 million.
Cash-flow items
As of June 30, 2023, cash and cash equivalents amounted to €71.4
million, compared to €84.2 million as of December 31, 2022,
corresponding in a decrease of €12.8 million.
The net cash flow used during the period under review mainly
results from the following:
- Net cash flow used by operations of €11.5 million for the six
months ended June 30, 2023 as compared to net cash flows generated
by operations of €1.2 million for the six months ended June 30,
2022. The net cash flow used in operating activities includes (i)
the €25.0 million upfront payment received from Sanofi in March
2023 following the effectiveness of the research collaboration and
licensing agreement signed in December 2022 under which the Company
granted Sanofi an exclusive license to Innate Pharma's B7-H3 ANKET®
program and options on two additional targets, but also (ii) the
€4.6 million ($5.0 million) upfront payment received from Takeda
following the signing of an exclusive licensing agreement which the
Company grants Takeda exclusive worldwide rights for the research
and development of antibody drug conjugates (ADCs). As a reminder,
net cash flow from operating activities for the first half of 2022
included the collection of €47.7 million, in June 2022, following
the treatment of the first patient in the second Phase 3 clinical
trial evaluating monalizumab, “PACIFIC-9”, partially offset by the
€5.9 million payment to AstraZeneca on April 20, 2022 pursuant to
the Lumoxiti termination and transition agreement. Restated for
these transactions, net cash flow used in operating activities for
the first half of 2023 increased by €0.5 million as compared to the
first half of 2022. This change mainly results from the occurrence
of exceptional cash flows in the first half of 2022, notably in
connection with personnel costs and the BPI repayable advance. Net
outflows in connection with the monalizumab and IPH5201
collaboration agreement were stable over the period. Net cash flow
consumed by operating activities in connection with the Lumoxiti
discontinued operation are nil for the first half of 2023, as
compared to €5.5 million for the first half of 2022. The amount
consumed for the first half of 2022 mainly relates to the payment
of €5.9 million ($6.2 million) made to AstraZeneca in April 2022 in
accordance with the Lumoxiti termination and transition agreement
effective as of June 30, 2021.
- Net cash flow used in investing activities of €0.2 million, as
compared to €0.4 million for the first half of 2022. The Company
has not made any other investments in tangible, intangible or
significant financial assets during the first half of 2023 and
2022. Net cash flows consumed by investing activities in connection
with the Lumoxiti discontinued operation were nil for the first
half of 2023 and 2022.
- Net cash flows used in financing activities for the six months
ended June 30, 2023 were €1.2 million as compared to net cash flow
used in financing activities of €1.0 million the six months ended
June 30, 2022. These consumptions are mainly related to repayments
of financial liabilities. Net cash flows consumed by financing
activities in connection with the Lumoxiti discontinued operation
were nil for the first half of 2023 and 2022.
Post period events
None.
Nota
The interim consolidated financial statements for the six-month
period ended June 30, 2023 have been subject to a limited review by
our Statutory Auditors and were approved by the Executive Board of
the Company on September 13, 2023. They were reviewed by the
Supervisory Board of the Company on September 13, 2023. They will
not be submitted for approval to the general meeting of
shareholders.
Risk factors
Risk factors identified by the Company are presented in section
3 of the universal registration document (“Document
d’Enregistrement Universel”) submitted to the French stock-market
regulator, the “Autorité des Marchés Financiers”, on April 6, 2023
(AMF number D.23-0246). The main risks and uncertainties the
Company may face in the six remaining months of the year are the
same as the ones presented in the universal registration document
available on the internet website of the Company.
Of note, the risks that are likely to arise during the remaining
six months of the current financial year could also occur during
subsequent years.
Related party
transactions:
Transactions with related parties during the periods under
review are disclosed in Note 19 to the interim condensed
consolidated financial statements for the period ended June 30,
2023 prepared in accordance with IAS 34.
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For additional information, please contact:
Investors Innate
Pharma Henry Wheeler Tel.: +33 (0)4 84 90 32 88
Henry.Wheeler@innate-pharma.fr
Media Relations
NewCap Arthur Rouille Tel. : +33 (0)1 44 71 00 15
innate@newcap.eu
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