Assembly Biosciences Announces Third Quarter 2018 Financial Results and Provides HBV Program Update

November 8, 2018 at 7:00 AM EST

ABI-H0731 Phase 2a Clinical Trials Actively Enrolling Patients; Data Continues to be Anticipated in 1H 2019

ABI-H2158 Phase 1a Study Initiated

ABI-H3733 Nominated as Third Core Inhibitor Candidate

SAN FRANCISCO, Nov. 08, 2018 (GLOBE NEWSWIRE) --  Assembly Biosciences, Inc. (NASDAQ: ASMB), a clinical-stage biotechnology company developing innovative therapeutics targeting hepatitis B virus (HBV) and diseases associated with the microbiome, today reported financial results for the third quarter ended September 30, 2018 and provided an update on the progress in its HBV and microbiome pipelines.

“We are excited about the advancements we have made in our HBV portfolio, with two core inhibitors now in clinical trials and the selection of a third potent, novel clinical candidate,” said Derek Small, President and Chief Executive Officer. “With the nomination of ABI-H3733 as our third candidate, we have a deep pipeline of HBV core inhibitors in development and continue our discovery efforts focused on identifying additional chemical scaffolds. We are actively enrolling patients in our ongoing ABI-H0731 Phase 2a proof-of-concept studies, and our team is committed to advancing potential curative therapy to HBV patients. Our microbiome platform has also made great strides over the past quarter and pending the successful conclusion of IND-enabling studies, we hope to have our first candidate ABI-M201 for ulcerative colitis in the clinic next year. Importantly, our strong balance sheet supports our development plans through multiple inflection points.”

Third Quarter and Recent Highlights

• Assembly continued enrolling patients in two Phase 2a studies evaluating ABI-H0731, the Company’s lead HBV core inhibitor. The Phase 2a viral antigen proof-of-concept study was recently expanded to include an additional cohort of virus suppressed HBeAg negative patients. The addition of this cohort is not expected to significantly impact enrollment timelines and will further Assembly’s understanding of outcomes in different patient populations as well as aid in the design of potential registrational studies.

• Assembly initiated a Phase 1a dose-ranging clinical trial of ABI-H2158, the Company’s second, highly potent core inhibitor, in healthy volunteers.

• Assembly has nominated its third core inhibitor candidate, ABI-H3733, derived from a new chemical class distinct from Assembly’s other core inhibitors in development. In nonclinical studies, ABI-H3733 has exhibited superior potency while maintaining good drug-like properties. ABI-H3733 is currently undergoing investigational new drug (IND) enabling studies.

• Microbiome candidate ABI-M201 (partnered with Allergan) is currently completing IND-enabling studies and is expected to enter the clinic in 2019 in patients with mild to moderate ulcerative colitis.

Anticipated Milestones and Events

• ABI-H0731

  • Final Phase 1b data will be presented at the American Association for the Study of Liver Diseases Annual Meeting (AASLD) on Sunday, November 11, 2018 in San Francisco by MF Yuen, MD, PhD, Chief of Division of Gastroenterology and Hepatology, Queen Mary Hospital, Hong Kong.
  • Interim Phase 2a data is expected in the first half of 2019.

• ABI-H2158

  • Interim Phase 1a data expected in mid 2019.

• ABI-M201

  • Initiate Phase 1b clinical study in 2019 in patients with mild to moderate ulcerative colitis.

• Upcoming events

  • AASLD,  San Francisco, November 9-13, 2018
  • Jefferies London Healthcare Conference, November 14-15, 2018
  • Global Mizuho Investor Conference in New York, December 3-4, 2018

Third Quarter Financial Results

Cash, cash equivalents and marketable securities were approximately $233.9 million as of September 30, 2018 compared to approximately $94.9 million as of June 30, 2018.

Revenues consisting of revenue from collaborative research were approximately $4.3 million for the three months ended September 30, 2018, compared to approximately $2.7 million for the same period in 2017. The increase in revenue was due to an increase in Allergan-related activities and expense reimbursement.

Research and development expenses, excluding stock-based compensation expense, were approximately $16.6 million for the three months ended September 30, 2018, compared to approximately $9.4 million for the same period in 2017. This increase was primarily due to an increase of approximately $5.5 million in research and development expenses related to the HBV program and an increase of approximately $1.6M in research and development expenses related to the microbiome program. Stock-based compensation expense was approximately $2.5 million for the three months ended September 30, 2018, compared to approximately $1.6 million for the same period in 2017.

General and administrative expenses, excluding stock-based compensation expense, were approximately $4.2 million for the three months ended September 30, 2018, compared to approximately $3.1 million for the same period in 2017. This increase was primarily due to increased headcount across the organization.  Stock-based compensation expense was approximately $3.5 million for the three months ended September 30, 2018, as compared to $1.0 million for the same period in 2017.

Net loss attributable to common stockholders was approximately $21.5 million, or $0.87 per basic and diluted share, for the three months ended September 30, 2018, compared to approximately $12.3 million, or $0.71 per basic and diluted share for the same period in 2017. This increase was primarily due to an increase in research and development expenses related to the HBV program, and expenses related to non-cash, stock-based compensation, employee incentive programs and increased headcount across the organization.       

About Assembly Biosciences
Assembly Biosciences, Inc. is a clinical-stage biotechnology company developing innovative therapeutics targeting hepatitis B virus (HBV) and diseases associated with the microbiome.  The HBV program is focused on advancing a new class of potent, oral core inhibitors that have the potential to increase cure rates for chronically infected patients. The microbiome program is developing novel oral live synthetic biotherapeutic candidates with Assembly’s fully integrated platform, including a robust process for strain identification and selection, GMP banking and production, and targeted delivery to the lower gastrointestinal tract with the GEMICEL® technology. For more information, visit assemblybio.com.

Forward-Looking Statements
The information in this press release contains forward-looking statements regarding future events, including statements about the clinical and therapeutic potential of core inhibitors, including ABI-H0731, ABI-H2158 and ABI-H3733, Assembly’s development programs, the initiation, progress and results of Assembly’s ongoing and planned clinical studies and the timing of these events, and the sufficiency of capital through inflection points. Certain forward-looking statements may be identified by reference to a future period or by use of forward-looking terminology such as “plan,” “upcoming,” “anticipated,” “will,” “expected,” and “potential.” Assembly intends such forward-looking statements to be covered by the safe harbor provisions contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results or developments may differ materially from those projected or implied in these forward-looking statements. More information about the risks and uncertainties faced by Assembly are more fully detailed under the heading “Risk Factors” in Assembly's Quarterly Report on Form 10-Q for the quarter ended September 30, 2018 filed with the Securities and Exchange Commission. Except as required by law, Assembly assumes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Contacts
Assembly Biosciences, Inc.
Investors:
Lauren Glaser
(415) 521-3828
lglaser@assemblybio.com 

  Assembly Biosciences, Inc.        
  Condensed Consolidated Balance Sheets September 30,   December 31,  
      2018       2017    
    (Unaudited)      
  ASSETS        
  Current assets        
  Cash and cash equivalents $   119,752,339     $   82,033,209    
  Marketable securities, at fair value     114,187,793         37,914,482    
  Accounts receivable from collaboration     2,589,862         2,273,421    
  Prepaid expenses and other current assets     3,342,759         897,400    
  Total current assets     239,872,753         123,118,512    
           
  Long-term assets        
  Marketable securities, at fair value     -         3,347,213    
  Property, plant and equipment, net     515,798         860,026    
  Security deposits     950,515         339,558    
  Intangible assets      29,000,000         29,000,000    
  Goodwill     12,638,136         12,638,136    
  Total long-term assets     43,104,449         46,184,933    
  Total assets $    282,977,202     $    169,303,445    
           
  LIABILITIES AND STOCKHOLDERS' EQUITY        
  Current liabilities        
  Accounts payable  $   2,987,565     $   2,123,939    
  Accrued expenses      6,517,053         6,139,000    
  Deferred revenue - short-term     5,105,104         5,229,227    
  Total current liabilities     14,609,722         13,492,166    
           
  Long-term liabilities        
  Deferred rent     7,903         -    
  Deferred tax liabilities     2,107,300         2,135,802    
  Deferred revenue - long-term     36,819,053         40,555,708    
  Total long-term liabilities     38,934,256         42,691,510    
  Total liabilities     53,543,978         56,183,676    
           
  Commitments and contingencies        
           
  Stockholders' equity        
  Preferred stock, $0.001 par value; 5,000,000 shares authorized; 0 shares issued and outstanding     -         -    
  Common stock, $0.001 par value; 100,000,000 and 50,000,000 shares authorized as of September 30, 2018 and December 31, 2017; 25,460,122 and 20,137,974 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively     25,460         20,138    
  Additional paid-in capital     545,388,704         364,528,037    
  Accumulated other comprehensive loss     (354,896 )       (392,391 )  
  Accumulated deficit     (315,626,044 )       (251,036,015 )  
  Total stockholders' equity     229,433,224         113,119,769    
  Total liabilities and stockholders' equity $    282,977,202     $    169,303,445    
           

 

  Assembly Biosciences, Inc.                  
  Condensed Consolidated Statements of Operations and Comprehensive Loss                  
  (Unaudited)   Three Months Ended September 30,   Nine Months Ended September 30,  
        2018       2017       2018       2017    
  Collaboration revenue   $   4,285,848     $   2,659,613     $   11,068,773     $   5,703,293    
                     
   Operating expenses:                   
   Research and development        19,108,918         10,929,436         51,490,220         33,628,196    
   General and administrative        7,752,493         4,180,357         25,992,186         12,022,357    
   Total operating expenses        26,861,411         15,109,793         77,482,406         45,650,553    
   Loss from operations        (22,575,563 )       (12,450,180 )       (66,413,633 )       (39,947,260 )  
                     
   Other income (expenses)                   
   Interest and other income        1,116,053         241,326         2,015,475         617,668    
   Realized loss from marketable securities        (82,070 )       (99,068 )       (232,320 )       (577,300 )  
   Total other income        1,033,983         142,258         1,783,155         40,368    
   Loss before income taxes        (21,541,580 )       (12,307,922 )       (64,630,478 )       (39,906,892 )  
                     
   Income tax benefit        6,542         35,903         40,449         105,416    
   Net loss    $    (21,535,038 )   $    (12,272,019 )   $    (64,590,029 )   $    (39,801,476 )  
                     
   Other comprehensive (loss) income                   
   Unrealized loss recognized in accumulated other comprehensive loss before reclassification, net of tax benefit of $50,664, $31,844, $44,192 and $89,281, respectively        (8,749 )       (51,203 )       (138,686 )       (143,562 )  
   Reclassification adjustment of unrealized loss included in net loss, net of tax expense of $56,139, $37,987, $56,139 and $221,358, respectively        25,931         61,081         176,181         355,942    
   Comprehensive loss    $    (21,517,856 )   $    (12,262,141 )   $    (64,552,534 )   $    (39,589,096 )  
                     
  Net loss per share, basic and diluted   $   (0.87 )   $   (0.71 )   $   (2.95 )   $   (2.30 )  
                     
  Weighted average common shares outstanding, basic and diluted       24,878,413         17,367,523         21,900,943         17,326,506    
                     

 

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Source: Assembly Biosciences, Inc.