CD22

ZYNLONTA® (loncastuximab tesirine-lpyl) net sales of $16.6 million in 4Q 2023 and $69.1 million for full year (FY) 2023; 4Q sales grew sequentially in both academic and community settings Focused pipeline progressing with continued LOTIS-7 dose escalation, screening patients for ADCT-601 targeting AXL in pancreatic cancer, and advancing differentiated solid tumor research platform FY 2023 operating expenses decreased 21%1 year-over-year due to portfolio prioritization and operational efficiencies; $278.6M of cash with expected runway extended into 4Q 2025 Company to host conference call today at 8:30 a.m. EDT LAUSANNE, Switzerland, March 13, 2024 (GLOBE NEWSWIRE) -- ADC Therapeutics SA (NYSE: ADCT) today reported financial results for the fourth quarter and full year ended December 31, 2023, and provided business updates. “During 2023, we reset our business and capital allocation strategy, strengthened our team and established a clear roadmap to drive value creation for all our stakeholders,” said Ameet Mallik, Chief Executive Officer of ADC Therapeutics. “In the fourth quarter we saw results of our strategy in action across a number of key areas. The impact of our new commercial model resulted in a resumption of growth for ZYNLONTA® sales volume compared to the third quarter, in both community and academic settings. Meanwhile, our prioritized pipeline delivered encouraging data, which we were pleased to share in a business update in January. We also disclosed for the first time our new, differentiated solid tumor platform, which can bring substantial opportunities for the Company through internal and external development. With an expected cash runway into the fourth quarter of 2025 and multiple potential value-generating catalysts ahead, I am excited about our prospects and look forward to updating you on our progress in 2024.” Recent Highlights and Developments ZYNLONTA® (loncastuximab tesirine-lpyl) ZYNLONTA generated product net sales of $16.6 million in the fourth quarter of 2023, representing a 17% increase over the third quarter of 2023 and a 16% decrease over the fourth quarter of 2022. A return to sequential quarter-over-quarter growth in the fourth quarter of 2023 followed the restructuring of the commercial model, with sales volume increasing in both community and academic settings. The year-over-year net sales decline reflected disruption during the year from the restructuring of the go-to-market model together with the impact of increased competition and higher gross-to-net sales deductions, partially offset by a slight price increase. Hematology Pipeline LOTIS-5: The Phase 3 confirmatory trial for ZYNLONTA in combination with rituximab in patients with 2L+ diffuse large B-cell lymphoma (DLBCL) continues to see accelerated enrollment. As noted by the clinical team and confirmed with the Independent Data Monitoring Committee (IDMC), we have observed higher-than-expected censoring in this trial. As a result, we may need to enroll additional patients, beyond the originally planned 350 patients, to achieve the required number of pre-specified progression-free survival events. The Company continues to expect to complete enrollment of this trial in 2024. The IDMC noted no safety concerns and recommended the trial to proceed at its most recent meeting held on January 16, 2024.LOTIS-7: The Phase 1b trial of ZYNLONTA in combination with bispecific antibodies glofitamab or mosunetuzumab for the treatment of heavily pre-treated patients with DLBCL, follicular lymphoma (FL) and marginal zone lymphoma (MZL) is actively enrolling patients. The dose-limiting toxicity (DLT) period has been cleared for the first two dosing levels of ZYNLONTA (90 µg/kg, 120 µg/kg) in both arms and we are currently enrolling patients at 150 µg/kg. After the first Investigator assessment, we have seen evidence of anti-tumor activity among the majority of patients dosed at the first two levels, with mixed histologies including DLBCL, FL and MZL. The Company expects to share additional data once a larger and more mature dataset is available.Investigator-Initiated Trial: As announced by the Company on January 4, 2024, an oral presentation at the American Society of Hematology (ASH) 2023 Annual Meeting from the University of Miami investigator-initiated trial exploring ZYNLONTA in combination with rituximab in high-risk relapsed or refractory FL patients indicated a best overall response rate of 96.3% and a complete response rate of 85.2%​. After a median follow-up of 9.7 months, the median progression-free survival (PFS) was not reached, and the 12-month PFS was 92.3%​. The majority of AEs were grade 1. Grade 3 AEs included neutropenia (n=2; 6.2%), and one case each (3.1%) of hyperglycemia, increased ALT, fatigue, dyspnea and skin infection. Neutropenia was the only grade 4 AE (n=1; 3.1%).ADCT-602 (targeting CD22): Dose escalation and expansion in the Phase 1 study with relapsed or refractory acute lymphoblastic leukemia in collaboration with MD Anderson Cancer Center is progressing and additional clinical trial sites are being added to accelerate enrollment. Solid Tumor Pipeline ADCT-601 (targeting AXL): In the Phase 1b trial, the maximum tolerated dose has been reached, and the study is currently in dose optimization. On January 4, 2024, the Company announced that early signs of anti-tumor activity had been seen in both monotherapy and in combination and that the safety profile indicated that ADCT-601 was well tolerated at the doses tested. Additional data from the trial are expected to be shared in a presentation at the American Association for Cancer Research (AACR) Annual Meeting 2024 (April 5–10, 2024). The abstract details are available online. The ongoing dose-optimization/expansion phase is comprised of a monotherapy arm including patients with sarcoma, pancreatic cancer and AXL-expressing non-small cell lung cancer (NSCLC) and a combination arm with gemcitabine in patients with sarcoma and pancreatic cancer. Screening was recently initiated for pancreatic cancer in the monotherapy arm.Early-stage pipeline: The Company is advancing a portfolio of investigational ADCs including those targeting Claudin-6, NaPi2b and PSMA. These candidates are based on an innovative proprietary approach which utilizes exatecan with a novel hydrophilic linker as a highly potent and differentiated payload. Data on the Claudin-6 and NaPi2b programs are expected to be shared in presentations at the AACR Annual Meeting 2024. Abstracts details are currently available online. A research investor event is being planned for 2Q 2024 to share additional information. Upcoming Expected Milestones ZYNLONTA Achieve commercial brand profitability in 2024LOTIS-5: Complete enrollment in 2024LOTIS-7: Additional data from the Phase 1b dose-escalation in 3L+ in mixed histologies (Part 1) in 2Q 2024 and from the dose-expansion in 2L+ DLBCL (Part 2) in 2H 2024Investigator-initiated trial in FL: The study is being expanded to 100 patients in a multicenter clinical trial. Updates are expected at medical meetings.Investigator-initiated trial in MZL: The study is designed to enroll 50 patients in a multicenter clinical trial. A futility analysis is expected to be conducted in 2Q 2024. Updates are expected at medical meetings. Pipeline ADCT-601 (targeting AXL) Additional data updates from the Phase 1 study in patients with sarcoma, pancreatic cancer and NSCLC in 2024 ADCT-602 (targeting CD22) Additional data from the Phase 1 study in 2024 Preclinical Advancing a broad portfolio of investigational ADCs for solid tumor indications Fourth Quarter and FY 2023 Financial Results Cash and Cash Equivalents Cash and cash equivalents were $278.6 million as of December 31, 2023, compared to $326.4 million as of December 31, 2022. The Company currently expects its cash runway to extend into the fourth quarter of 2025. Product Revenues Net product revenues were $16.6 million for the fourth quarter and $69.1 million for full year 2023, compared to $19.8 million and $74.9 million, respectively, for the fourth quarter and full year 2022. Net product revenues are for U.S. sales of ZYNLONTA. The fourth quarter and full year decrease was primarily due to higher gross-to-net deductions and lower sales volume which was impacted by disruption following restructuring of the commercial organization and increased competition, partially offset by a slightly higher price. License Revenues and Royalties License revenues and royalties were $0.1 million for the fourth quarter and $0.5 million for full year 2023, compared to $50.0 million and $135.0 million, respectively, for the fourth quarter and full year 2022. The fourth quarter and full year decrease was primarily due to upfront and milestone payments under our exclusive license agreements with Sobi and MTPC that were recognized in 2022. Research and Development (R&D) Expenses R&D expenses were $30.3 million for the fourth quarter and $127.1 million for full year 2023, compared to $48.1 million and $186.5 million, respectively, for the fourth quarter and full year 2022. R&D expenses decreased due to less investment in camidanlumab tesirine (Cami), as well as productivity initiatives and focused investment toward prioritized development programs. The decrease in R&D expenses related to Cami was primarily due to completion of the Phase 2 study in 2022 and the Company’s decision to pause the program while it evaluated FDA feedback. R&D expenses in the fourth quarter and full year 2023 also decreased due to lower share-based compensation expense resulting from fluctuations in the share price and award forfeitures in connection with terminations. Selling and Marketing (S&M) Expenses S&M expenses were $13.9 million for the fourth quarter and $57.5 million for full year 2023, as compared to $16.2 million and $69.1 million, respectively, for the fourth quarter and full year 2022. The decrease in S&M expenses for the fourth quarter and full year was primarily due to lower spend on marketing and analytics, lower wages and benefits, as well as lower share-based compensation expense resulting from fluctuations in the share price and award forfeitures in connection with terminations. General & Administrative (G&A) Expenses G&A expenses were $11.3 million for the fourth quarter and $48.4 million for full year 2023, compared to $15.7 million and $74.4 million, respectively, for the fourth quarter and full year 2022. G&A expenses decreased for the fourth quarter and full year primarily due to lower share-based compensation expense resulting from fluctuations in the share price and award forfeitures in connection with terminations, as well as lower wages and benefits and insurance costs. Net Loss and Adjusted Net Loss Net loss was $85.0 million, or a net loss of $1.03 per basic and diluted share, for the fourth quarter of 2023 and $240.1 million, or a net loss of $2.94 per basic and diluted share for full year 2023. This compares to a net loss of $23.3 million, or a net loss of $0.29 per basic and diluted share, for the fourth quarter of 2022 and $157.1 million, or a net loss of $2.01 per basic and diluted share, for full year 2022. The increase in net loss in both periods primarily reflects the reduction in license revenues and royalties, together with higher income tax expense and lower product revenues, partially offset by lower operating expense. Adjusted net loss, which is a non-GAAP financial measure, was $79.5 million, or an adjusted net loss of $0.97 per basic and diluted share for the fourth quarter of 2023 and $185.7 million, or an adjusted net loss of $2.27 per basic and diluted share for the full year 2023. This compares to an adjusted net loss of $6.7 million, or an adjusted net loss of $0.08 per basic and diluted share, for the fourth quarter of 2022 and $80.3 million, or an adjusted net loss of $1.03 per basic and diluted share, for full year 2022. The increase in adjusted net loss for the fourth quarter and full year 2023 primarily reflects the reduction in License revenues and royalties, together with higher income tax expense and lower product revenues, partially offset by lower operating expense. Conference Call Details ADC Therapeutics management will host a conference call and live audio webcast to discuss fourth quarter and full year 2023 financial results and provide a company update today at 8:30 a.m. Eastern Time. To access the conference call, please register here. Registrants will receive the dial-in number and unique PIN. It is recommended that you join 10 minutes before the event, though you may pre-register at any time. A live webcast of the call will be available under “Events & Presentations” in the Investors section of the ADC Therapeutics website at ir.adctherapeutics.com. The archived webcast will be available for 30 days following the call. About ZYNLONTA® (loncastuximab tesirine-lpyl) ZYNLONTA® is a CD19-directed antibody drug conjugate (ADC). Once bound to a CD19-expressing cell, ZYNLONTA is internalized by the cell, where enzymes release a pyrrolobenzodiazepine (PBD) payload. The potent payload binds to DNA minor groove with little distortion, remaining less visible to DNA repair mechanisms. This ultimately results in cell cycle arrest and tumor cell death. The U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA) have approved ZYNLONTA (loncastuximab tesirine-lpyl) for the treatment of adult patients with relapsed or refractory (r/r) large B-cell lymphoma after two or more lines of systemic therapy, including diffuse large B-cell lymphoma (DLBCL) not otherwise specified (NOS), DLBCL arising from low-grade lymphoma and also high-grade B-cell lymphoma. The trial included a broad spectrum of heavily pre-treated patients (median three prior lines of therapy) with difficult-to-treat disease, including patients who did not respond to first-line therapy, patients refractory to all prior lines of therapy, patients with double/triple hit genetics and patients who had stem cell transplant and CAR-T therapy prior to their treatment with ZYNLONTA. This indication is approved by the FDA under accelerated approval and in the European Union under conditional approval based on overall response rate and continued approval for this indication may be contingent upon verification and description of clinical benefit in a confirmatory trial. Please see full prescribing information including important safety information about ZYNLONTA at www.ZYNLONTA.com. ZYNLONTA is also being evaluated as a therapeutic option in combination studies in other B-cell malignancies and earlier lines of therapy. About ADC Therapeutics ADC Therapeutics (NYSE: ADCT) is a commercial-stage global leader and pioneer in the field of antibody drug conjugates (ADCs). The Company is advancing its proprietary ADC technology to transform the treatment paradigm for patients with hematologic malignancies and solid tumors. ADC Therapeutics’ CD19-directed ADC ZYNLONTA (loncastuximab tesirine-lpyl) received accelerated approval by the FDA and conditional approval from the European Commission for the treatment of relapsed or refractory diffuse large B-cell lymphoma after two or more lines of systemic therapy. ZYNLONTA is also in development in combination with other agents and in earlier lines of therapy. In addition to ZYNLONTA, ADC Therapeutics has multiple ADCs in ongoing clinical and preclinical development. ADC Therapeutics is based in Lausanne (Biopôle), Switzerland and has operations in London, the San Francisco Bay Area and New Jersey. For more information, please visit https://adctherapeutics.com/ and follow the Company on LinkedIn. ZYNLONTA® is a registered trademark of ADC Therapeutics SA. Use of Non-GAAP Financial Measures In addition to financial information prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP), this document also contains certain non-GAAP financial measures based on management’s view of performance including: Adjusted total operating expensesAdjusted net lossAdjusted net loss per share Management uses such measures internally when monitoring and evaluating our operational performance, generating future operating plans and making strategic decisions regarding the allocation of capital. We believe that these adjusted financial measures provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and facilitate operating performance comparability across both past and future reporting periods. These non-GAAP measures have limitations as financial measures and should be considered in addition to, and not in isolation or as a substitute for, the information prepared in accordance with GAAP. When preparing these supplemental non-GAAP measures, management typically excludes certain GAAP items that management does not believe are indicative of our ongoing operating performance. Furthermore, management does not consider these GAAP items to be normal, recurring cash operating expenses; however, these items may not meet the GAAP definition of unusual or non-recurring items. Since non-GAAP financial measures do not have standardized definitions and meanings, they may differ from the non-GAAP financial measures used by other companies, which reduces their usefulness as comparative financial measures. Because of these limitations, you should consider these adjusted financial measures alongside other GAAP financial measures. The following items are excluded from adjusted net loss and adjusted net loss per share: Shared-Based Compensation Expense: We exclude share-based compensation expense from our adjusted financial measures because share-based compensation expense, which is non-cash, fluctuates from period to period based on factors that are not within our control, such as our stock price on the dates share-based grants are issued. Share-based compensation expense has been, and will continue to be for the foreseeable future, a recurring expense in our business and an important part of our compensation strategy. Certain Other Items: We exclude certain other significant items that we believe do not represent the performance of our business, from our adjusted financial measures. Such items are evaluated by management on an individual basis based on both quantitative and qualitative aspects of their nature. While not all-inclusive, examples of certain other significant items excluded from our adjusted financial measures would be: changes in the fair value of derivatives and warrant obligations and the effective interest expense associated with the Facility Agreement with Deerfield and the senior secured term loan facility and the effective interest expense and cumulative catch-up adjustments associated with the deferred royalty obligation under the royalty purchase agreement with HealthCare Royalty Partners. See the attached Reconciliation of GAAP Measures to Non-GAAP Measures for explanations of the amounts excluded and included to arrive at the non-GAAP financial measures. Forward-Looking Statements This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. In some cases you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “would”, “expect”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “seem”, “seek”, “future”, “continue”, or “appear” or the negative of these terms or similar expressions, although not all forward-looking statements contain these identifying words. Forward-looking statements are subject to certain risks and uncertainties that can cause actual results to differ materially from those described. Factors that may cause such differences include, but are not limited to: the success of the Company’s updated corporate strategy; the expected cash runway into the beginning of Q4 2025, the effectiveness of the new commercial go-to-market strategy, competition from new technologies, the Company’s ability to grow ZYNLONTA® revenue in the United States; Swedish Orphan Biovitrum AB (Sobi®) ability to successfully commercialize ZYNLONTA® in the European Economic Area and market acceptance, adequate reimbursement coverage, and future revenue from the same; approval by the NMPA of the BLA for ZYNLONTA® in China submitted by Overland ADCT BioPharma and future revenue from the same, our strategic partners’, including Mitsubishi Tanabe Pharma Corporation, ability to obtain regulatory approval for ZYNLONTA® in foreign jurisdictions, and the timing and amount of future revenue and payments to us from such partnerships; the timing and results of the Company’s or its partners’ research and development projects or clinical trials including LOTIS 5 and 7, ADCT 601 and 602 as well as IITs in FL and MZL and early research in certain solid tumors with different targets, linkers and payloads; the timing and outcome of regulatory submissions for the Company’s products or product candidates; actions by the FDA or foreign regulatory authorities; projected revenue and expenses; the Company’s indebtedness, including Healthcare Royalty Management and Blue Owl and Oaktree facilities, and the restrictions imposed on the Company’s activities by such indebtedness, the ability to comply with the terms of the various agreements and repay such indebtedness and the significant cash required to service such indebtedness; and the Company’s ability to obtain financial and other resources for its research, development, clinical, and commercial activities. Additional information concerning these and other factors that may cause actual results to differ materially from those anticipated in the forward-looking statements is contained in the “Risk Factors” section of the Company's Annual Report on Form 10-K and in the Company's other periodic and current reports and filings with the U.S. Securities and Exchange Commission. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance, achievements or prospects to be materially different from any future results, performance, achievements or prospects expressed in or implied by such forward-looking statements. The Company cautions investors not to place undue reliance on the forward-looking statements contained in this document. ADC Therapeutics SAConsolidated Statement of Operations (Unaudited)(in thousands, except for per share data) For the three months ended December 31, For the years ended December 31, 2023 2022 2023 2022Revenue Product revenues, net $16,643 $19,798 $69,060 $74,908License revenues and royalties 147 50,000 498 135,000Total revenue, net 16,790 69,798 69,558 209,908Operating expense Cost of product sales (1,215) (320) (2,529) (3,301)Research and development (30,331) (48,081) (127,127) (186,457)Selling and marketing (13,927) (16,176) (57,464) (69,052)General and administrative (11,295) (15,689) (48,424) (74,442)Total operating expense (56,768) (80,266) (235,544) (333,252)Loss from operations (39,978) (10,468) (165,986) (123,344) Other income (expense) Interest income 3,291 2,259 10,540 2,568Interest expense (12,909) (9,756) (46,325) (36,731)Loss on debt extinguishment — — — (42,114)Other, net 9,724 1,211 6,352 52,804Total other income (expense) 106 (6,286) (29,433) (23,473)Loss before income taxes (39,872) (16,754) (195,419) (146,817)Income tax expense (43,171) (3,055) (39,106) (227)Loss before equity in net losses of joint venture (83,043) (19,809) (234,525) (147,044)Equity in net losses of joint venture (1,988) (3,535) (5,528) (10,084)Net loss $(85,031) $(23,344) $(240,053) $(157,128) Net loss per share Net loss per share, basic and diluted $(1.03) $(0.29) $(2.94) $(2.01)Weighted average shares outstanding, basic and diluted 82,292,594 80,463,306 81,712,166 78,152,964 ADC Therapeutics SAConsolidated Balance Sheet (Unaudited)(in thousands) December 31 2023 December 31 2022ASSETS Current assets Cash and cash equivalents $278,598 $326,441Accounts receivable, net 25,182 72,971Inventory 16,177 12,073Prepaid expenses and other current assets 16,334 23,495Total current assets 336,291 434,980 Non-current assets Property and equipment, net 5,622 3,355Operating lease right-of-use assets 10,511 6,905Interest in joint venture 1,647 7,613Deferred taxes, net — 37,104Other long-term assets 711 902Total assets $354,782 $490,859 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities Accounts payable $15,569 $12,351Accrued expenses and other current liabilities 50,634 68,491Operating lease liabilities, short-term 1,467 1,097Total current liabilities 67,670 81,939 Deferred royalty obligation 303,572 212,353Senior secured term loans 112,730 109,714Operating lease liabilities, long-term 10,180 6,564Other long-term liabilities 8,879 838Total liabilities 503,031 411,408 Total shareholders’ (deficit) equity (148,249) 79,451 Total liabilities and shareholders’ equity $354,782 $490,859 ADC Therapeutics SAReconciliation of GAAP Measures to Non-GAAP Measures (Unaudited)(in thousands, except for share and per share data) Three Months Ended December 31, Years Ended December 31,(in thousands)2023 2022 Change % Change 2023 2022 Change % ChangeTotal operating expense (56,768) (80,266) 23,498 (29)% (235,544) (333,252) 97,708 (29)%Adjustments: Share-based compensation expense (i)2,220 8,344 (6,124) (73)% 13,495 50,637 (37,142) (73)%Adjusted total operating expenses (54,548) (71,922) 17,374 (24)% (222,049) (282,615) 60,566 (21)% Three months ended December 31, Twelve months ended December 31,in thousands (except for share and per share data)2023 2022 2023 2022Net loss$(85,031) $(23,344) $(240,053) $(157,128)Adjustments: Share-based compensation expense (i)2,220 8,344 13,495 50,637Convertible loans, derivatives, change in fair value income (ii)— — — (25,650)Loss on debt extinguishment (iii)— — — 42,114Deerfield warrants obligation, change in fair value expense (income) (ii)279 (2,086) (497) (11,504)Effective interest expense on convertible loans (iv)— — — 7,684Effective interest expense on senior secured term loan facility (iv)4,650 3,912 18,398 5,845Deferred royalty obligation interest expense (v)8,253 5,844 27,915 23,200Deferred royalty obligation cumulative catch-up adjustment (income) expense (v)(9,823) 631 (4,972) (15,482)Adjusted net loss$(79,452) $(6,699) $(185,714) $(80,284) Net loss per share, basic and diluted(1.03) (0.29) (2.94) (2.01)Adjustment to net loss per share, basic and diluted0.06 0.21 0.67 0.98Adjusted net loss per share, basic and diluted(0.97) (0.08) (2.27) (1.03)Weighted average shares outstanding, basic and diluted82,292,594 80,463,306 81,712,166 78,152,964 (i)Share-based compensation expense represents the cost of equity awards issued to our directors, management and employees. The fair value of awards is computed at the time the award is granted, and is recognized over the requisite service period less actual forfeitures by a charge to the statement of operations and a corresponding increase in additional paid-in capital within equity. These accounting entries have no cash impact. (ii)Change in the fair value of the convertible loan derivatives and Deerfield warrant obligation results from the valuation at the end of each accounting period. There are several inputs to these valuations, but those most likely to result in significant changes to the valuations are changes in the value of the underlying instrument (i.e., changes in the price of our common shares) and changes in expected volatility in that price. These accounting entries have no cash impact. (iii)As a result of the exchange agreement entered into on August 15, 2022, the Company recognized a loss on debt extinguishment which primarily consists of the difference between the aggregate principal amount and carrying amount of the convertible loans and exit fee as well as the unpaid interest payments through the maturity date. (iv)Effective interest expense on convertible loans and senior secured term loans relates to the increase in the value of our loans in accordance with the amortized cost method. (v)Deferred royalty obligation interest expense relates to the accretion expense on our deferred royalty obligation pursuant to the royalty purchase agreement with HCR and cumulative catch-up adjustment (income) expense relates to changes in the expected payments to HCR based on a periodic assessment of our underlying revenue projections. CONTACTS: Investors and MediaNicole RileyADC TherapeuticsNicole.Riley@adctherapeutics.com+1 862-926-9040 ________________ (1) on a non-GAAP basis or 29% on a GAAP basis including stock-based compensation expense. See reconciliation of GAAP measures to non-GAAP measures in accompanying financial tables

Goal to treat 40-60 patients in 2024 in four trials across seven indications in oncology, B-cell mediated autoimmune diseases, and type 1 diabetes Early SC291 data from ongoing ARDENT trial in relapsed/refractory NHL and CLL suggest ability to dose safely, demonstrate the desired immune evasion profile, and early clinical efficacy using hypoimmune technology Announced SC291 IND clearance for B-cell mediated autoimmune diseases with goal to report initial clinical data in 2024 Announced SC262 IND clearance for relapsed/refractory B-cell malignancies with goal to report initial clinical data in 2024 Announced CTA authorization for investigator-sponsored trial with hypoimmune-modified primary islet cells with potential clinical data in 1H2024 Publication in Cell Stem Cell demonstrates transplanted allogeneic hypoimmune-modified islet cells evade rejection and control glucose without immunosuppression or insulin treatment in non-human primate diabetes study Q4 2023 cash position of $205.2 million and expected 2024 operating cash burn below $200 million Recent financing of $189.8 million in gross proceed combined with existing cash position supports activities through multiple data readouts SEATTLE, Feb. 29, 2024 (GLOBE NEWSWIRE) -- Sana Biotechnology, Inc. (NASDAQ: SANA), a company focused on creating and delivering engineered cells as medicines, today reported financial results and business highlights for the fourth quarter and year ended December 31, 2023. “2023 was an important year for the company, setting a strong foundation in three therapeutic areas with significant unmet needs – blood cancers, B-cell mediated autoimmune diseases, and type 1 diabetes. With the ongoing trials in these areas – ARDENT, GLEAM, VIVID, and the primary islet cell investigator-sponsored trial – we expect to treat 40-60 patients across multiple indications in 2024 and report data from each study,” said Steve Harr, Sana’s President and Chief Executive Officer. “By year-end 2024, our goal is to demonstrate that we are able to transplant allogeneic cells in patients in multiple settings without immune detection or rejection, delivering potentially transformative therapies across multiple therapeutic areas. With the recent financing, we were able to strengthen the balance sheet, allowing us to continue to invest appropriately in moving our clinical pipeline forward.” Recent Corporate Highlights Advancing four clinical programs across seven indications, including an allogeneic CAR T program targeting CD19+ cancers, an allogeneic CAR T program for B-cell mediated autoimmune diseases, an allogeneic CAR T program targeting CD22+ cancers, and a primary islet cell therapy in type 1 diabetes: SC291 is a hypoimmune (HIP)-modified CD19-directed allogeneic CAR T for patients with B-cell malignancies and B-cell mediated autoimmune diseases.The ARDENT trial evaluates SC291 in patients with B-cell malignancies. Early SC291 data from the ongoing ARDENT trial suggest the ability to dose safely, the desired immune evasion profile, and early clinical efficacy. Enrollment in this dose escalation study continues, and Sana expects to share more data in 2024.The GLEAM trial evaluates SC291 in patients with B-cell mediated autoimmune diseases including lupus nephritis, extrarenal lupus, and antineutrophil cytoplasmic antibody (ANCA)-associated vasculitis. The Investigational New Drug Application (IND) cleared in 4Q 2023, and Sana expects to share initial data in 2024.The VIVID trial evaluates SC262, a HIP-modified CD22-directed allogeneic CAR T, in patients with relapsed or refractory B-cell malignancies. The VIVID trial initially investigates SC262 in patients who have received prior CD19-directed CAR T therapy. The IND cleared in early 2024, and Sana expects to share initial data in 2024.UP421 is a primary human HIP-modified islet cell therapy for patients with type 1 diabetes. The goal of this investigator-sponsored trial is to understand islet cell survival and immune evasion without immunosuppression in patients with autoimmunity, along with function as measured by C-peptide production. The Clinical Trial Application (CTA) cleared in 4Q 2023, and Sana expects initial data to be shared in the first half of 2024. Published preclinical data in Cell Stem Cell demonstrating that HIP-modified islet cells provided lasting endocrine function in a fully immunocompetent non-human primate, enabling the achievement of exogenous insulin independence without immunosuppression for six-month study duration: Sana developed HIP-modified allogeneic islet cells, which cluster into effective endocrine organoids termed “pseudo islet grafts” (p-islets). HIP p-islets engrafted and provided stable endocrine function, enabling insulin independence in the absence of immunosuppression.The allogeneic HIP p-islet graft survived for the six-month duration of the study with no indication of immune recognition of the HIP p-islet engraftment at any time. To demonstrate that there was no regeneration or recovery of an endogenous islet cell population in the diabetic NHP, HIP p-islets were eliminated using an anti-CD47 antibody, demonstrating proof of principle of CD47 overexpression and a potential safety switch. Published preclinical data in Nature Communications, Science Translational Medicine, and Nature Biotechnology describing immune evasion, persistence, and durable anti-tumor activity of HIP-modified CD19-directed CAR T cells and HIP-modified pseudo-islets control type 1 diabetes in preclinical models: Sana developed HIP-modified CD19-targeted allogeneic CAR T cells and compared them to unmodified CD19-targeted allogeneic CAR T cells in a murine leukemia model with a humanized immune system. Although both HIP-modified and unmodified CAR T cells showed robust early tumor killing, cell durability was much greater in humanized mice treated with HIP-modified cells. HIP-modified allogeneic CAR T cells persisted and removed all evidence of tumor for the duration of the study. HIP-modified CAR T cells also cleared all evidence of tumor after re-injection with cancer cells 90 days into the study.Preclinical data showed that p-islets survive, persist, escape allogeneic and autoimmune rejection, and normalize blood glucose in diabetic models with humanized immune systems.Preclinical data demonstrated that HIP-modified cells survive allogeneic transplant across several species, including non-human primates with normal immune systems, and remain fully functional. Advanced Sana’s HIP ex vivo platform with presentations at AACR, ADA, ISSCR, and ASH: Presented preclinical data demonstrating that HIP-modified CAR T cells provide lasting tumor control in immunocompetent allogeneic humanized mice even with tumor re-challenge.Presented preclinical data showing that HIP-modified CD19-directed CAR T cells have the potential to serve as a universal off-the-shelf therapy with long-term durability of response without immunosuppression.Presented preclinical data showing HIP-modified primary pancreatic islet cells alleviate type 1 diabetes in humanized mice and avoid immune rejection without immunosuppression.Presented preclinical data showing that intramuscular administration of islet cells in humanized mice does not impact cell function and viability and may serve as a preferred administration route for patients.Presented preclinical data supporting HIP-modified CD22-directed and GPRC5D-directed allogeneic CAR T cell programs.Presented preclinical data highlighting the SC379 glial progenitor cell program. Completed financing with gross proceeds of approximately $189.8 million to further support activities to enable multiple data readouts and announced key corporate updates: Closed on an upsized public offering in February 2024 of 21.8 million shares of Sana’s common stock, which includes the full exercise of the underwriter’s option, and pre-funded warrants to purchase 12.7 million shares of Sana’s common stock. The gross proceeds from this offering were approximately $189.8 million before deducting underwriting discounts and commissions and estimated offering expenses.Strengthened the Research and Development leadership with the appointment of two seasoned drug developers, Doug Williams, Ph.D., as President of Research and Development, and Gary Meininger, M.D., as Chief Medical Officer.Announced an increased focus on the ex vivo cell therapy platform based on extensive preclinical and early translational clinical data and a reduction in near-term investment on the fusogen in vivo delivery platform, resulting in an expected 2024 operating burn below $200 million.Named on the BioSpace 2024 Best Places to Work small employers list for the second year in a row. Fourth Quarter 2023 Financial Results GAAP Results Cash Position: Cash, cash equivalents, and marketable securities as of December 31, 2023 were $205.2 million compared to $434.0 million as of December 31, 2022. The decrease of $228.8 million was primarily driven by cash used in operations of $253.6 million and cash used for the purchase of property and equipment of $20.0 million. The decrease in cash was partially offset by net proceeds of $27.0 million from at the market equity offerings during the year ended December 31, 2023.Research and Development Expenses: For the three and twelve months ended December 31, 2023, research and development expenses, inclusive of non-cash expenses, were $63.0 million and $268.8 million, respectively, compared to $63.9 million and $285.9 million for the same periods in 2022. The decrease of $0.9 million for the three months ended December 31, 2023 compared to the same period in 2022 was primarily due to decreased laboratory and research costs, partially due to the portfolio prioritizations in 2022 and 2023, a decline in personnel-related costs, including non-cash stock-based compensation, and lower costs for third-party manufacturing at CDMOs. These decreases were partially offset by costs incurred related to the impairment of certain lab equipment and leasehold improvements, primarily due to the portfolio prioritization in the fourth quarter of 2023 and increased clinical development costs. The decrease of $17.1 million for the twelve months ended December 31, 2023 compared to the same period in 2022 was primarily due to decreased laboratory and research costs partially due to the portfolio prioritizations in 2022 and 2023, lower costs for third-party manufacturing at CDMOs, decreased costs to acquire technology, and lower non-cash stock-based compensation expense. These decreases were partially offset by increased clinical development costs and costs incurred related to the impairment of certain lab equipment and leasehold improvements, primarily due to the portfolio prioritization in the fourth quarter of 2023. Research and development expenses include non-cash stock-based compensation of $4.9 million and $23.2 million, respectively, for the three and twelve months ended December 31, 2023, and $6.0 million and $26.6 million, for the same periods in 2022.Research and Development Related Success Payments and Contingent Consideration: For the three and twelve months ended December 31, 2023, Sana recognized a non-cash expense of $6.8 million and a non-cash gain of $49.0 million, respectively, in connection with the change in the estimated fair value of the success payment liabilities and contingent consideration in aggregate, compared to gains of $5.5 million and $84.9 million for the same periods in 2022. The value of these potential liabilities may fluctuate significantly with changes in Sana’s market capitalization and stock price.General and Administrative Expenses: General and administrative expenses for the three and twelve months ended December 31, 2023, inclusive of non-cash expenses, were $20.8 million and $73.3 million, respectively, compared to $23.3 million and $71.6 million for the same periods in 2022. The decrease of $2.5 million for the three months ended December 31, 2023 compared to the same period in 2022 was primarily due lower personnel-related costs, including non-cash stock-based compensation, a decrease in costs related to Sana’s previously planned manufacturing facility in Fremont, California (Fremont facility), which were formerly in research and development expense, and lower insurance costs. These decreases were partially offset by an increase in patent and other legal fees. The increase of $1.7 million for the twelve months ended December 31, 2023 compared to the same period in 2022 was primarily due to an increase in patent and other legal fees, a loss on termination of lease associated with the Fremont facility (Fremont lease), and increased facility costs. These increases were partially offset by the write-off of construction in progress costs in 2022 for the Fremont facility, and a decrease in insurance costs.Net Loss: Net loss for the three and twelve months ended December 31, 2023 was $88.1 million, or $0.45 per share, and $283.3 million, or $1.46 per share, respectively, compared to $80.4 million, or $0.42 per share, and $269.5 million, or $1.43 per share for the same periods in 2022. Non-GAAP Measures Non-GAAP Operating Cash Burn: Non-GAAP operating cash burn for the twelve months ended December 31, 2023 was $233.0 million compared to $288.3 million for the same period in 2022. Non-GAAP operating cash burn is the decrease in cash, cash equivalents, and marketable securities, excluding cash inflows from financing activities, cash outflows from business development, costs related to the early termination of the Fremont lease, non-recurring items, and the purchase of property and equipment.Non-GAAP Research and Development Expenses: Non-GAAP research and development expenses for the three and twelve months ended December 31, 2023 were $56.0 million and $261.8 million, respectively, compared to $63.9 million and $285.9 million for the same periods in 2022. Non-GAAP research and development expense in 2023 excludes an expense related to the impairment of certain lab equipment and leasehold improvements, primarily due to the portfolio prioritization in the fourth quarter of 2023.Non-GAAP General and Administrative Expenses: Non-GAAP general and administrative expenses for the three and twelve months ended December 31, 2023 were $15.6 million and $65.4 million, respectively, compared to $14.6 million and $58.4 million for the same periods in 2022. Non-GAAP general and administrative expense excludes personnel-related costs related to the portfolio prioritizations in the fourth quarters of 2023 and 2022, the net expense recorded in connection with the early termination of the Fremont lease and derecognition of the related right-of-use asset and lease liability in 2023, and the write-off of construction in progress costs incurred in connection with the Fremont facility in 2022.Non-GAAP Net Loss: Non-GAAP net loss for the three and twelve months ended December 31, 2023 was $69.1 million, or $0.35 per share, and $317.4 million, or $1.63 per share, respectively, compared to $77.2 million, or $0.40 per share, and $341.2 million, or $1.81 per share for the same periods in 2022. Non-GAAP net loss excludes non-cash expenses and gains related to the change in the estimated fair value of contingent consideration and success payment liabilities, personnel-related costs related to portfolio prioritizations in the fourth quarters of 2023 and 2022, an expense related to the impairment of certain lab equipment and leasehold improvements, primarily due to the portfolio prioritization in the fourth quarter of 2023, the net expense recorded in connection with the early termination of the Fremont lease and derecognition of the related right-of-use asset and lease liability in 2023, and the write-off of construction in progress costs incurred in connection with the Fremont facility in 2022. A discussion of non-GAAP measures, including a reconciliation of GAAP and non-GAAP measures, is presented below under “Non-GAAP Financial Measures.” About Sana Sana Biotechnology, Inc. is focused on creating and delivering engineered cells as medicines for patients. We share a vision of repairing and controlling genes, replacing missing or damaged cells, and making our therapies broadly available to patients. We are a passionate group of people working together to create an enduring company that changes how the world treats disease. Sana has operations in Seattle, Cambridge, South San Francisco, and Rochester. Cautionary Note Regarding Forward-Looking Statements This press release contains forward-looking statements about Sana Biotechnology, Inc. (the “Company,” “we,” “us,” or “our”) within the meaning of the federal securities laws, including those related to the company’s vision, progress, and business plans; expectations for its development programs, product candidates and technology platforms, including its preclinical, clinical and regulatory development plans and timing expectations, including the expected timing of IND filings and clinical trials for the Company’s product candidates and indications for which such INDs will be filed; expectations regarding the number of patients to be treated and the indications to be evaluated in its clinical trials in 2024; expectations regarding the timing, substance, significance, and impact of data from clinical trials of the Company’s product candidates and an IST utilizing HIP-modified primary islet cells in patients with type 1 diabetes patients; the potential ability to use hypoimmune technology to dose safely and achieve efficacy in certain indications; expectations regarding the Company’s 2024 operating cash burn; expectations regarding the potential of the gross proceeds from the recent financing along with the Company’s existing cash position to support activities through multiple data readouts; and the ability to demonstrate by year-end 2024 that the Company’s is able to transplant allogeneic cells in patients in multiple settings without immune detection or rejection. All statements other than statements of historical facts contained in this press release, including, among others, statements regarding the Company’s strategy, expectations, cash runway and future financial condition, future operations, and prospects, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “aim,” “anticipate,” “assume,” “believe,” “contemplate,” “continue,” “could,” “design,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “positioned,” “potential,” “predict,” “seek,” “should,” “target,” “will,” “would” and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology. The Company has based these forward-looking statements largely on its current expectations, estimates, forecasts and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy and financial needs. In light of the significant uncertainties in these forward-looking statements, you should not rely upon forward-looking statements as predictions of future events. These statements are subject to risks and uncertainties that could cause the actual results to vary materially, including, among others, the risks inherent in drug development such as those associated with the initiation, cost, timing, progress and results of the Company’s current and future research and development programs, preclinical and clinical trials, as well as economic, market, and social disruptions. For a detailed discussion of the risk factors that could affect the Company’s actual results, please refer to the risk factors identified in the Company’s Securities and Exchange Commission (SEC) reports, including but not limited to its Annual Report on Form 10-K dated February 29, 2024. Except as required by law, the Company undertakes no obligation to update publicly any forward-looking statements for any reason. Investor Relations & Media:Nicole Keithinvestor.relations@sana.commedia@sana.com Sana Biotechnology, Inc.Unaudited Selected Consolidated Balance Sheet Data December 31, 2023 December 31, 2022 (in thousands) Cash, cash equivalents, and marketable securities$205,195 $434,014 Total assets 565,299 822,720 Contingent consideration 109,606 150,379 Success payment liabilities 12,799 21,007 Total liabilities 277,793 323,405 Total stockholders' equity 287,506 499,315 Sana Biotechnology, Inc.Unaudited Consolidated Statements of Operations Three Months Ended December 31, Twelve Months Ended December 31, 2023 2022 2023 2022 (in thousands, except per share data) Operating expenses: Research and development$63,000 $63,921 $268,823 $285,885 Research and development related success payments and contingent consideration 6,835 (5,454) (48,981) (84,882)General and administrative 20,784 23,321 73,299 71,561 Total operating expenses 90,619 81,788 293,141 272,564 Loss from operations (90,619) (81,788) (293,141) (272,564)Interest income, net 2,726 1,613 9,938 3,762 Other expense, net (224) (268) (52) (674)Net loss$(88,117) $(80,443) $(283,255) $(269,476)Net loss per common share – basic and diluted$(0.45) $(0.42) $(1.46) $(1.43)Weighted-average number of common shares – basic and diluted 197,317 190,420 194,541 188,344 Sana Biotechnology, Inc.Changes in the Estimated Fair Value of Success Payments and Contingent Consideration Success PaymentLiability(1) ContingentConsideration(2) Total Success Payment Liability and Contingent Consideration (in thousands) Liability balance as of December 31, 2022$21,007 $150,379 $171,386 Changes in fair value – expense (gain) (5,340) 5,460 120 Liability balance as of March 31, 2023 15,667 155,839 171,506 Changes in fair value – expense 20,784 5,895 26,679 Liability balance as of June 30, 2023 36,451 161,734 198,185 Changes in fair value – gain (24,037) (58,578) (82,615)Liability balance as of September 30, 2023 12,414 103,156 115,570 Changes in fair value – expense 385 6,450 6,835 Liability balance as of December 31, 2023$12,799 $109,606 $122,405 Total change in fair value for the twelve months ended December 31, 2023$(8,208) $(40,773) $(48,981) (1) Cobalt Biomedicine, Inc. (Cobalt) and the Presidents of Harvard College (Harvard) are entitled to success payments pursuant to the terms and conditions of their respective agreements. The success payments are recorded at fair value and remeasured at each reporting period with changes in the estimated fair value recorded in research and development related success payments and contingent consideration on the statement of operations. (2) Cobalt is entitled to contingent consideration upon the achievement of certain milestones pursuant to the terms and conditions of the agreement. Contingent consideration is recorded at fair value and remeasured at each reporting period with changes in the estimated fair value recorded in research and development related success payments and contingent consideration on the statement of operations. Non-GAAP Financial Measures To supplement the financial results presented in accordance with generally accepted accounting principles in the United States (GAAP), Sana uses certain non-GAAP financial measures to evaluate its business. Sana’s management believes that these non-GAAP financial measures are helpful in understanding Sana’s financial performance and potential future results, as well as providing comparability to peer companies and period over period. In particular, Sana’s management utilizes non-GAAP operating cash burn, non-GAAP research and development expense and non-GAAP net loss and net loss per share. Sana believes the presentation of these non-GAAP measures provides management and investors greater visibility into the company’s actual ongoing costs to operate its business, including actual research and development costs unaffected by non-cash valuation changes and certain one-time expenses for acquiring technology, as well as facilitating a more meaningful comparison of period-to-period activity. Sana excludes these items because they are highly variable from period to period and, in respect of the non-cash expenses, provides investors with insight into the actual cash investment in the development of its therapeutic programs and platform technologies. These are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read in conjunction with Sana’s financial statements prepared in accordance with GAAP. These non-GAAP measures differ from GAAP measures with the same captions, may be different from non-GAAP financial measures with the same or similar captions that are used by other companies, and do not reflect a comprehensive system of accounting. Sana’s management uses these supplemental non-GAAP financial measures internally to understand, manage, and evaluate Sana’s business and make operating decisions. In addition, Sana’s management believes that the presentation of these non-GAAP financial measures is useful to investors because they enhance the ability of investors to compare Sana’s results from period to period and allows for greater transparency with respect to key financial metrics Sana uses in making operating decisions. The following are reconciliations of GAAP to non-GAAP financial measures: Sana Biotechnology, Inc.Unaudited Reconciliation of Change in Cash, Cash Equivalents, and Marketable Securities toNon-GAAP Operating Cash Burn Twelve Months Ended December 31, 2023 2022 (in thousands) Beginning cash, cash equivalents, and marketable securities$434,014 $746,877 Ending cash, cash equivalents, and marketable securities 205,195 434,014 Change in cash, cash equivalents, and marketable securities (228,819) (312,863)Cash paid to purchase property and equipment 20,032 20,876 Change in cash, cash equivalents, and marketable securities, excluding capital expenditures (208,787) (291,987)Adjustments: Net proceeds from issuance of common stock(1) (27,020) (601)Cash paid in connection with the termination of the Fremont lease 4,423 - Cash paid for personnel-related costs related to portfolio prioritizations 5,454 4,333 Cash received in connection with the Coronavirus Aid, Relief, and Economic Security Act (7,063) - Operating cash burn – Non-GAAP$(232,993) $(288,255) (1) Net proceeds of $27.0 million and $0.6 million were received in connection with at market equity offerings in the twelve months ended December 31, 2023 and 2022, respectively. Sana Biotechnology, Inc.Unaudited Reconciliation of GAAP to Non-GAAP Research and Development Expense Three Months Ended December 31, Twelve Months Ended December 31, 2023 2022 2023 2022 (in thousands) Research and development expense – GAAP$63,000 $63,921 $268,823 $285,885 Adjustments: Expense related to the impairment of certain lab equipment and leasehold improvements(1) (7,014) - (7,014) - Research and development expense – Non-GAAP$55,986 $63,921 $261,809 $285,885 (1) The impairment of $7.0 million recorded in the three months ended December 31, 2023 was primarily related to the portfolio prioritization that occurred during the quarter. Sana Biotechnology, Inc.Unaudited Reconciliation of GAAP to Non-GAAP General and Administrative Expense Three Months Ended December 31, Twelve Months Ended December 31, 2023 2022 2023 2022 (in thousands) General and administrative – GAAP$20,784 $23,321 $73,299 $71,561 Adjustments: Costs incurred in connection with portfolio prioritizations (5,203) (8,704) (5,203) (8,704)Loss on termination of Fremont lease(1) - - (2,668) - Write-off of construction in progress costs incurred in connection with the Fremont facility - - - (4,474)General and administrative – Non-GAAP$15,581 $14,617 $65,428 $58,383 (1) For the twelve months ended December 31, 2023, the net expense of $2.7 million included $4.4 million in fees incurred, offset by a gain of $1.7 million recorded in connection with the derecognition of the right-of use asset and lease liability. Sana Biotechnology, Inc.Unaudited Reconciliation of GAAP to Non-GAAP Net Loss and Net Loss Per Share Three Months Ended December 31, Twelve Months Ended December 31, 2023 2022 2023 2022 (in thousands, except per share data) Net loss – GAAP$(88,117) $(80,443) $(283,255) $(269,476)Adjustments: Change in the estimated fair value of the success payment liabilities(1) 385 (14,703) (8,208) (81,518)Change in the estimated fair value of contingent consideration(2) 6,450 9,249 (40,773) (3,364)Costs incurred in connection with portfolio prioritizations 5,203 8,704 5,203 8,704 Loss on termination of Fremont lease(3) - - 2,668 - Write-off of construction in progress costs incurred in connection with the Fremont facility - - - 4,474 Expense related to the impairment of certain lab equipment and leasehold improvements(4) 7,014 - 7,014 - Net loss – Non-GAAP$(69,065) $(77,193) $(317,351) $(341,180)Net loss per share – GAAP$(0.45) $(0.42) $(1.46) $(1.43)Adjustments: Change in the estimated fair value of the success payment liabilities(1) - (0.08) (0.04) (0.43)Change in the estimated fair value of contingent consideration(2) 0.03 0.05 (0.21) (0.02)Costs incurred in connection with portfolio prioritizations 0.03 0.05 0.03 0.05 Loss on termination of Fremont lease(3) - - 0.01 - Write-off of construction in progress costs incurred in connection with the Fremont facility - - - 0.02 Expense related to the impairment of certain lab equipment and leasehold improvements(4) 0.04 - 0.04 - Net loss per share – Non-GAAP$(0.35) $(0.40) $(1.63) $(1.81)Weighted-average shares outstanding – basic and diluted 197,317 190,420 194,541 188,344 (1) For the three months ended December 31, 2023, the expense related to the Cobalt success payment liability was $0.4 million compared to a gain of $7.9 million for the twelve months ended December 31, 2023. For the three and twelve months ended December 31, 2022, the gains related to the Cobalt success payment liability were $12.9 million and $69.3 million, respectively. For the three and twelve months ended December 31, 2023, the gains related to the Harvard success payment liability were $12.0 thousand and $0.3 million, respectively, compared to gains of $1.8 million and 12.2 million, respectively, for the same periods in 2022. (2) The contingent consideration is in connection with the acquisition of Cobalt.(3) For the twelve months ended December 31, 2023, the net expense of $2.7 million included $4.4 million in fees incurred, offset by a gain of $1.7 million recorded in connection with the derecognition of the right-of use asset and lease liability.(4) The impairment of $7.0 million recorded in the three months ended December 31, 2023 was primarily related to the portfolio prioritization that occurred during the quarter.

Transplant of HIP-modified pancreatic islet cells provided lasting glucose control in a fully immunocompetent non-human primate (NHP), enabling the achievement of exogenous insulin independence without immunosuppression for six month study duration Administration of anti-CD47 antibody after six months demonstrated the principle of graft ablation and a potential safety strategy Feb. 13, 2024 -- Sana Biotechnology, Inc. (NASDAQ: SANA), a company focused on changing the possible for patients through engineered cells, today announced that Cell Stem Cell has published a paper titled “Hypoimmune islets achieve insulin independence after allogeneic transplantation in a fully immunocompetent non-human primate.” The paper evaluated a transplant of Sana’s engineered allogeneic, hypoimmune (HIP)-modified pancreatic islet cells into a fully immunocompetent, diabetic non-human primate (NHP). These modified islet cells, which cluster into effective endocrine organoids, are termed “pseudo islet grafts” (p-islets). The results demonstrated that the HIP-modified p-islets engrafted following intramuscular injection and provided stable endocrine function, enabling insulin independence in the absence of immunosuppression. “The results of this preclinical study are remarkable, and if they translate into the clinic, we have the potential to profoundly change the way that type 1 diabetes is addressed, potentially eliminating the need for insulin injections or immunosuppression,” said Sonja Schrepfer, MD, PhD, Sana’s Head of Hypoimmune Platform. “We look forward to insights from an investigator-sponsored trial (IST), a first-in-human study of HIP-modified, allogeneic primary islet cells later this year, which would serve as clinical proof-of-concept to assess the safety, cell survival, immune evasion, and C-peptide production of transplanted HIP-modified primary islet cells without immunosuppression into a patient with type 1 diabetes. This publication, along with the ongoing IST, will provide invaluable insights toward our stem cell derived product candidate, SC451. With more than 8 million patients with type 1 diabetes worldwide, there is an enormous need to cure – rather than simply manage – this disease.” “JDRF is dedicated to harnessing the power of research, advocacy, and community engagement to advance life-changing breakthroughs for type 1 diabetes,” said Sanjoy Dutta, PhD, JDRF Chief Scientific Officer. “The development of cell therapies that replace the loss of insulin-producing cells could one day offer cures for type 1 diabetes. A key area of focus for JDRF is to develop strategies to protect these cells after transplantation that remove the use of broad immunosuppression. As a supporter and investor in Sana through the JDRF T1D Fund, we look forward to seeing if the results described in this paper translate into people, as they would represent a meaningful advance in the treatment of type 1 diabetes.” The transplant setting was purposely designed to be a high immunological bar by maximizing the donor-to-recipient mismatch. Diabetes mellitus was chemically induced in the recipient as shown by the development of major blood glucose instability and the need for daily insulin injections to control blood sugar. Following stabilization of glucose with insulin treatment, the diabetic NHP underwent transplantation of the HIP p-islets without any induction or maintenance immunosuppression and the administration of insulin was tapered to zero over the course of nine days. Rapidly following HIP p-islet transplantation, the diabetic NHP recipient showed tightly controlled blood glucose levels, was completely insulin-independent, continuously healthy, and exhibited no physical or behavioral abnormalities for the six-month study duration. C-peptide levels, which are a marker for endogenous insulin production and release, reached the normal levels observed prior to induction of diabetes. Furthermore, there was no indication that the allogeneic HIP p-islet graft induced any immune recognition or any type of immune response at any time. To demonstrate that there was no regeneration or recovery of an endogenous islet cell population in the diabetic NHP, HIP p-islets were eliminated using an anti-CD47 antibody. The antibody blocked the protective CD47 signal and triggered a “missing self” innate immune cell response that led to the rapid destruction of the HIP p-islet graft. Following the anti-CD47 treatment, blood glucose levels in the diabetic NHP began to fluctuate and increase markedly, and insulin injections needed to be resumed. It was thus demonstrated that the tightly controlled blood glucose levels and insulin independence was entirely due to well-functioning HIP p-islets. Sana’s hypoimmune platform is designed to create cells ex vivo that can evade the patient’s immune system to enable the transplant of allogeneic cells without the need for immunosuppression. We are applying the hypoimmune technology to both donor-derived allogeneic T cells, with the goal of making potent and persistent CAR T cells at scale, and pluripotent stem cells, which can then be differentiated into multiple cell types at scale. Preclinical data published in peer-reviewed journals demonstrate across a variety of cell types that these transplanted allogeneic cells are able to evade both the innate and adaptive arms of the immune system while retaining their activity. Our most advanced programs utilizing this platform include an allogeneic CAR T program targeting CD19+ cancers, an allogeneic CAR T program for B-cell mediated autoimmune diseases, an allogeneic CAR T program targeting CD22+ cancers, and stem-cell derived pancreatic islet cells for patients with type 1 diabetes. Sana Biotechnology, Inc. is focused on creating and delivering engineered cells as medicines for patients. We share a vision of repairing and controlling genes, replacing missing or damaged cells, and making our therapies broadly available to patients. We are a passionate group of people working together to create an enduring company that changes how the world treats disease. Sana has operations in Seattle, Cambridge, South San Francisco, and Rochester. For more information about Sana Biotechnology, please visit https://sana.com/. The content above comes from the network. if any infringement, please contact us to modify.