Mersana Therapeutics(MRSN) - 2022 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Collaboration revenue for Q2 2022 was $4.3 million, compared to an immaterial amount in Q2 2021, reflecting revenue from the collaboration with Janssen [38] - Research and development expenses increased to $41.2 million in Q2 2022 from $32 million in Q2 2021, driven by clinical and manufacturing costs for XMT-1660 and UpRi [39] - General and administrative expenses rose to $14.8 million in Q2 2022 from $8.9 million in Q2 2021, primarily due to increased consulting fees and headcount [41] - Net loss for Q2 2022 was $52.2 million, or $0.55 per share, compared to a net loss of $40.9 million, or $0.59 per share in Q2 2021 [42] Business Line Data and Key Metrics Changes - The company is advancing three clinical trials: UPLIFT, UP-NEXT, and UPGRADE, focusing on UpRi as a foundational medicine in ovarian cancer [15][17] - XMT-1660 and XMT-2056 have recently cleared INDs, with XMT-1660 targeting B7-H4 and XMT-2056 targeting HER2 [18][30] Market Data and Key Metrics Changes - The collaboration with GSK provides an upfront option purchase fee of $100 million, extending the company's cash runway into the first half of 2024 [12][33] - If GSK exercises its option, the company could receive an additional $90 million and up to approximately $1.3 billion in milestone payments [34] Company Strategy and Development Direction - The company aims to be a leader in the ADC space, with a focus on advancing its Immunosynthen platform and establishing UpRi in ovarian cancer [7][14] - Strategic partnerships, such as the recent collaboration with GSK, are viewed as essential for leveraging the company's platforms and enhancing financial resources [8][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the progress made in clinical trials and the potential for transformative developments in 2023 [19][43] - The company acknowledges the high unmet medical needs in ovarian cancer treatment and aims to address these through its ongoing trials [22] Other Important Information - The company ended the quarter with approximately $225 million in cash and marketable securities, with additional access to $35 million in low-cost capital [36] - The company is actively diversifying its clinical pipeline while maintaining a strong focus on its ADC platforms [18][30] Q&A Session Summary Question: Are you still running the Phase 1 study for XMT-2056? - Yes, the Phase 1 study is ongoing and remains wholly owned by the company, focusing on breast cancer [47] Question: Any additional color on the timelines for the option exercise with GSK? - It is too early to provide specific timelines for the option exercise [49] Question: Was there any new data shared with GSK during the diligence process for 2056? - The diligence process was comprehensive, involving both public and additional data to support the potential of 2056 [54] Question: How many patients and what follow-up can be expected for UPGRADE data in Q4? - Initial interim data will focus on safety and tolerability, with further efficacy characterized in the expansion data [55]