Jasper Therapeutics(US:JSPR)2023-03-08 21:10PART I Business Jasper Therapeutics is a clinical-stage biotechnology company focused on developing therapeutics for mast and hematopoietic stem cell diseases - The company's lead product candidate is briquilimab, a monoclonal antibody targeting the CD117 receptor on mast and stem cells, being developed for therapeutic use in CSU and LR-MDS, and as a conditioning agent for stem cell transplants in diseases like SCID, AML/MDS, and SCD31 - Jasper is also developing an mRNA stem cell platform designed to reprogram stem cells to have a transient proliferative and survival advantage, potentially enabling higher engraftment levels without toxic conditioning4054 - The company holds exclusive worldwide license agreements with Amgen for the development and commercialization of briquilimab and with Stanford University for its use in stem cell clearance prior to transplantation42 Briquilimab Development Pipeline & Anticipated Milestones | Indication/Program | Stage | Anticipated Milestones | | :--- | :--- | :--- | | Therapeutic Development | | | | Lower to Intermediate Risk MDS | Clinical | 1H 2023 clinical study initiation | | Chronic Urticaria | Clinical | 2H 2023 clinical study initiation | | Transplant Development | | | | AML/MDS | Clinical | 1Q 2023 1-year AML clinical data presentation | | Severe Combined Immunodeficiency | Clinical | Prepare for BLA submission | | Fanconi Anemia | Clinical | 2023 patient enrollment ongoing | | Sickle Cell Disease | Clinical | 2023 patient enrollment ongoing | | Jasper mRNA Stem Cell Graft Platform | | | | Thalassemias, Sickle Cell Disease | Preclinical | 2024 first IND filing | Our Product Pipeline The pipeline is centered on briquilimab and an mRNA stem cell platform, with briquilimab in clinical trials for mast cell and stem cell disorders, and the mRNA platform in preclinical development - Briquilimab is being developed as a chronic therapy for CSU and LR-MDS, with IND filing for CSU planned for Q2 2023 and a study in LR-MDS patients anticipated to begin in 1H 20234853 - In a Phase 1/2 trial for SCID, briquilimab conditioning enabled donor engraftment and immune improvement in 7 out of 10 re-transplant patients, with no treatment-related SAEs reported3693 - In a Phase 1 trial for AML/MDS, briquilimab-based conditioning was well-tolerated in 31 patients, led to successful engraftment in all, and resulted in 67% of AML patients being alive and MRD-free at one year38107 - The mRNA stem cell platform is in preclinical development, with initial in-vitro results showing potential for enhanced stem cell proliferation and engraftment. The first IND filing is anticipated in 202431119123 Intellectual Property Jasper's intellectual property strategy relies on in-licensed patents from Amgen and Stanford, and its own patent filings, primarily covering briquilimab and hematopoietic stem cell transplantation - The company has exclusively licensed a patent portfolio from Amgen for its humanized c-kit antibody, with issued U.S. and European patents expected to expire in 2027135 - An exclusive license from Stanford University covers the use of briquilimab for depleting stem cells prior to transplantation, with patents also expected to expire in 2027136 - Jasper owns eleven patent families related to hematopoietic stem cell transplantation, which include ten U.S. provisional applications, one U.S. utility application, and three PCT applications. Any patents granted from these would be expected to expire in 2042 or 2044137 Competition Jasper faces intense competition in the biotechnology sector for its briquilimab CD117 program and its mRNA-modified stem cell therapy platform from various pharmaceutical and biotech companies - Competitors for the briquilimab program include Celldex, Acelyrin, and Gilead, which are also developing antibodies targeting CD117 for mast cell diseases or stem cell transplants143 - Competitors for the mRNA-modified stem cell therapy program include Vor Biopharma, Sana Biotechnology, and Orca Bio, which are developing treatment-resistant, hypoimmune, or precision allogeneic cell therapies143 Government Regulation The company's product candidates are regulated as biologics in the U.S. and EU, requiring extensive preclinical and clinical development, regulatory approvals, and post-market compliance - In the U.S., product candidates are regulated as biologics and require a Biologics License Application (BLA) for marketing approval, following successful preclinical and multi-phase clinical trials148150 - The FDA provides several expedited review programs, including Fast Track, Breakthrough Therapy, Priority Review, and Regenerative Advanced Therapy (RMAT), to accelerate the development and approval of drugs for serious conditions168173 - In the European Union, marketing authorization requires submitting a Marketing Authorization Application (MAA) through a centralized procedure administered by the EMA, which is compulsory for certain biologics and innovative products184185 - Sales of approved products depend on coverage and reimbursement from third-party payors like Medicare, Medicaid, and commercial insurers, who are increasingly focused on cost-containment and cost-effectiveness188190 Risk Factors The company faces substantial risks, including a history of significant net losses, dependence on its lead candidate and novel platform, reliance on third parties, and stock price volatility - The company has a history of significant net losses ($37.7 million in 2022) and expects to incur losses for the foreseeable future, requiring substantial additional funding to continue operations210 - Business success is substantially dependent on the lead product candidate, briquilimab. Failure to complete development, obtain approval, or commercialize it would severely harm the business208237 - The mRNA stem cell platform is a novel, unproven technology that is not yet clinically validated and may never lead to marketable products208245 - The company relies on a single manufacturer (Lonza) for the clinical supply of its product candidates and is highly dependent on intellectual property licensed from third parties like Amgen and Stanford209335350 - The company faces risks related to its stock, including price volatility, potential delisting from Nasdaq if minimum bid price requirements are not maintained, and significant dilution from future equity sales209460467 Unresolved Staff Comments The company reports that it has no unresolved staff comments from the SEC - There are no unresolved staff comments496 Properties The company leases approximately 13,400 square feet for its headquarters in Redwood City, California, with the current lease expiring in August 2026 - The company leases approximately 13,400 square feet of headquarters space in Redwood City, California497 - The current lease expires in August 2026, with a five-year extension option497 Legal Proceedings As of the report date, Jasper Therapeutics is not a party to any material legal proceedings - The company is not currently a party to any material legal proceedings498 Mine Safety Disclosures This item is not applicable to the company - Not applicable499 PART II Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The company's common stock and public warrants are listed on Nasdaq, with no dividends declared or anticipated, as earnings will be retained for business growth - Common stock and Public Warrants are listed on the Nasdaq Capital Market under symbols "JSPR" and "JSPRW"502 - The company has never paid dividends and does not plan to in the foreseeable future, retaining earnings for business growth504 Management's Discussion and Analysis of Financial Condition and Results of Operations Jasper Therapeutics reported a net loss of $37,685 thousand in 2022, driven by increased R&D and G&A expenses, but bolstered its cash position with a $101,400 thousand financing in January 2023 Financial Performance Summary (FY 2022 vs. FY 2021) | Metric | FY 2022 | FY 2021 | | :--- | :--- | :--- | | Net Loss | ($37,685 thousand) | ($30,637 thousand) | | Research & Development Expenses | $34,627 thousand | $25,421 thousand | | General & Administrative Expenses | $16,569 thousand | $11,412 thousand | | Cash Used in Operations | ($45,858 thousand) | ($33,678 thousand) | | Cash & Cash Equivalents (Year-End) | $38,250 thousand | $84,701 thousand | | Accumulated Deficit (Year-End) | ($105,100 thousand) | ($67,500 thousand) | - The increase in R&D expenses was driven by higher personnel-related costs (+$3.0 million), facilities/overhead (+$3.4 million), and consulting costs (+$1.4 million), partially offset by a decrease in CRO/CMO expenses (-$1.5 million)543544545 - The increase in G&A expenses was due to higher employee payroll and stock-based compensation (+$2.9 million) and increased professional services costs (+$1.9 million) to support operations as a public company546 - In January 2023, the company raised total estimated net proceeds of $101.4 million from a public offering and its ATM program, which is expected to fund the operating plan for at least the next 12 months518 Results of Operations For the year ended December 31, 2022, the company's net loss increased to $37.7 million due to a $14.4 million rise in total operating expenses, partially offset by increased other income Comparison of Operating Results (in thousands) | Line Item | Year Ended Dec 31, 2022 | Year Ended Dec 31, 2021 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Research and development | $34,627 | $25,421 | $9,206 | 36% | | General and administrative | $16,569 | $11,412 | $5,157 | 45% | | Total operating expenses | $51,196 | $36,833 | $14,363 | 39% | | Loss from operations | ($51,196) | ($36,833) | ($14,363) | 39% | | Total other income, net | $13,511 | $6,196 | $7,315 | 118% | | Net loss | ($37,685) | ($30,637) | ($7,048) | 23% | - The $9.2 million increase in R&D expenses was primarily due to a $6.4 million rise in internal costs (personnel and facilities) and a $2.8 million increase in external costs (consulting and supplies), despite a $1.5 million decrease in CRO/CMO spending542543544 - The $7.3 million increase in total other income was mainly driven by a $6.7 million larger gain on the change in fair value of the common stock warrant liability compared to the prior year541547 Liquidity and Capital Resources As of December 31, 2022, the company had $38.3 million in cash, and subsequently raised $101.4 million in January 2023, which is deemed sufficient for the next twelve months of operations - The company held $38.3 million in cash and cash equivalents as of December 31, 2022551 - In January 2023, the company raised approximately $96.9 million in net proceeds from an underwritten public offering and $4.5 million from its ATM offering553554 - Management concluded that existing cash plus the January 2023 financing proceeds are sufficient to fund the operating plan for at least twelve months from the filing date of this report518557 Cash Flow Summary (in thousands) | Cash Flow Activity | Year Ended Dec 31, 2022 | Year Ended Dec 31, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | $(45,858) | $(33,678) | | Net cash used in investing activities | $(576) | $(2,428) | | Net cash provided by financing activities | $55 | $100,969 | | Net (decrease) increase in cash | $(46,379) | $64,863 | Quantitative and Qualitative Disclosures About Market Risk The company's market risks are primarily interest rate risk on its cash holdings and foreign currency exchange risk, neither of which has been material to date - The company's primary market risk is interest rate risk on its $38.3 million of cash and cash equivalents, but historical fluctuations have not been significant588 - Foreign currency exchange risk arises from using certain vendors outside the U.S., but transaction gains and losses have not been material to date589 - The company does not have a formal hedging program for foreign currency risk589 Financial Statements and Supplementary Data This section presents the audited consolidated financial statements for Jasper Therapeutics for fiscal years 2022 and 2021, including balance sheets, statements of operations, and cash flows Consolidated Balance Sheet Data (in thousands) | | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $38,250 | $84,701 | | Total current assets | $41,731 | $87,831 | | Total assets | $48,361 | $93,654 | | Liabilities & Equity | | | | Total current liabilities | $7,065 | $8,020 | | Total liabilities | $12,372 | $24,136 | | Total stockholders' equity | $35,989 | $69,518 | Consolidated Statement of Operations Data (in thousands) | | Year Ended Dec 31, 2022 | Year Ended Dec 31, 2021 | | :--- | :--- | :--- | | Research and development | $34,627 | $25,421 | | General and administrative | $16,569 | $11,412 | | Loss from operations | ($51,196) | ($36,833) | | Net loss | ($37,685) | ($30,637) | | Net loss per share | ($1.03) | ($2.69) | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None746 Controls and Procedures Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2022 - Management concluded that disclosure controls and procedures were effective as of December 31, 2022748 - Management concluded that internal control over financial reporting was effective as of December 31, 2022750 - No material changes were made to internal control over financial reporting during the quarter ended December 31, 2022751 Other Information The company reports no other information for this item - None752 PART III Directors, Executive Officers and Corporate Governance Information regarding directors, executive officers, and corporate governance will be incorporated by reference from the upcoming 2023 Proxy Statement - Information is incorporated by reference from the upcoming 2023 Proxy Statement756 Executive Compensation Information regarding executive compensation will be incorporated by reference from the upcoming 2023 Proxy Statement - Information is incorporated by reference from the upcoming 2023 Proxy Statement757 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Information regarding security ownership will be incorporated by reference from the upcoming 2023 Proxy Statement - Information is incorporated by reference from the upcoming 2023 Proxy Statement758 Certain Relationships and Related Transactions, and Director Independence Information regarding related party transactions and director independence will be incorporated by reference from the upcoming 2023 Proxy Statement - Information is incorporated by reference from the upcoming 2023 Proxy Statement759 PART IV Principal Accountant Fees and Services Information regarding principal accountant fees and services will be incorporated by reference from the upcoming 2023 Proxy Statement - Information is incorporated by reference from the upcoming 2023 Proxy Statement761 Exhibits, Financial Statement Schedules This section lists the financial statements and exhibits filed with or incorporated by reference into the Form 10-K, including material agreements - The financial statements are listed in the Index to Financial Statements in Part II, Item 8762 - A comprehensive list of exhibits filed with the report is provided, including material agreements such as the Business Combination Agreement, license agreements with Amgen and Stanford, and equity incentive plans765 Form 10-K Summary The company reports no Form 10-K summary for this item - None769