Earnings Release • Apr 1, 2021
Earnings Release
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Søren Bregenholt
CEO Alligator Bioscience AB (publ)
"As new CEO of Alligator Bioscience, after just around a month, let me say that my high expectations on the company have been surpassed already. During this short time, I have been ascertained that Alligator has a strong pipeline that builds on a powerful technology platform."
As new CEO of Alligator Bioscience, after just around a month, let me say that my high epectations on the company have been surpassed already. During this short time, I have been ascertained that Alligator has a strong pipeline that builds on a powerful technology platform. I have the privilege of leading an experienced and dedicated team that is committed to bring innovative treatment to patients with cancer. To deliver on this promise, our key clinical programs, mitazalimab and ATOR-1017, are clearly in focus and will remain so as we gradually move them into clinical efficacy studies, starting with the clinical Phase II study with mitazalimab which we expect to start soon.
In the beginning of June, at the 2021 ASCO Annual Meeting, we presented novel data from the ongoing Phase I dose escalation study with ATOR-1017, Alligator's monoclonal antibody developed to improve combination therapy for metastatic solid tumors. ATOR-1017 is designed to stimulate the 4-1BB receptor on T cells and natural killer (NK) cells in the tumors, and not elsewhere in the body. As such, ATOR-1017 will induce potent tumor-directed immune responses leading to increased efficacy as well as reduced side effects for patients.
The novel data presented at ASCO are very encouraging and validate the mechanism and therapeutic potential of ATOR-1017, and demonstrate a very favorable safety profile. We are now focused on completing the study and determine the optimal therapeutic dose for the subsequent Phase II program. We are preparing for the Phase II program, that we will initiate once we have determined the optimal therapeutic dose and have secured financial resources allowing us to also complete the study.
Alligator's other key program, the human CD40 agonistic antibody mitazalimab, has shown encouraging data from more than 100 patients in two previous clinical Phase I studies; demonstrating early signs of efficacy, proof of mechanism and a manageable safety profile. OPTIMIZE-1, the mitazalimab Phase II study is designed to assess the efficacy and safety of the drug in combination with standard of care chemotherapy in first line metastatic pancreatic cancer patients.
The immuno-oncology mechanism behind this program is quite straight forward: While the chemotherapy kills tumor cells resulting in an increased release of tumor antigens, mitazalimab activates the CD40 receptor leading to improved presentation
of tumor antigens and activation of T cell-dependent anti-tumor responses which, in turn, leads to enhanced anti-tumor efficacy. OPTIMIZE-1 is an open-label, multicenter study that will include up to 67 patients. The study is underway and we expect to include the first patient soon. A first interim readout is expected by the end of 2021, and an interim efficacy readout during H2 2022.
The concept of mitazalimab was further strengthened in the past quarter by two publications in peer-reviewed journals. Data published in Cancer Immunology, Immunotherapy show that mitazalimab activates dendritic cells and tumor-reactive T cells resulting in enhanced anti-tumor efficacy in combination with a model cancer vaccine, thus expanding and strengthening the therapeutic potential for mitazalimab. The review article published in Expert Opinion on Biological Therapy provides an overview of the CD40 agonistic antibodies in clinical development, lists current
challenges and opportunities for this important class of immunooncology drugs, and describes the background for mitazalimab's best-in-class potential.
I would also like to mention the drug candidate ALG.APV-527, a bispecific antibody targeting the 4-1BB and 5T4 molecules, that is co-developed with our partner Aptevo Therapeutics. ALG.APV-527 is approaching clinical studies and a CTA application will be submitted during the second half of 2021.
Our ambition is to develop meaningful therapies for patients with cancer and to create value for our shareholders. This require that we focus our resources to areas where they make the most impact. Therefore, we must prioritize and even discontinue projects that do not align with our ambition. After a thorough diligence of potential ways forward, we have decided to stop further development activities in the ATOR-1015 program, where data from the previous Phase I study showed that the unique molecular format of ATOR-1015 caused infusion-related events.
Alligator has a solid and competitive technology platform. That is evident, not only through our programs, but also by our research collaboration agreements. Neo-X-PrimeTM is Alligator's proprietary drug concept for patient-specific immunotherapy. In April we entered a joint research collaboration with US-based MacroGenics. Under this agreement we leverage the Neo-X-PrimeTM platform to generate bispecific antibodies against two undisclosed targets. MacroGenics is widely viewed as a leader in the antibody field and we are truly excited by this possibility to create a drug candidate that takes advantage of a unique mechanism of a patient's own immune system to fight cancer. We also entered a joint research agreement with the Swedish biopharma company BioArctic AB where we will employ our proprietary antibody generation technologies to identify new product candidates for neurodegenerative diseases.
At the end of June, we presented promising preclinical data within our Scandion Oncology collaboration, where we explore the anti-tumor efficacy of mitazalimab in combination with SCO-101 as an addition to chemotherapy (FOLFIRINOX) in chemotherapyresistant preclinical tumor models. The preliminary results strengthen the preclinical efficacy data for mitazalimab and validate the potential of mitazalimab in combination with standard of care chemotherapy. This bodes well for our OPTIMIZE-1 Phase II study.
The Covid-19 pandemic, still affects how we operate but has had limited impact on Alligator's preclinical and clinical activities during last year. With the high vaccination rates achieved in Sweden and around Europe, the overall uncertainty has been reduced further and we do not foresee that Covid-19 will significantly impact our ability to prepare and execute clinical studies going forward.
In summary, the Alligator team is committed to deliver on our ambition to develop meaningful therapies for patients with cancer through a continued focus on the company's key clinical programs. We are convinced of the potential of our drug candidates and how they will impact future cancer therapy. The Alligator team is committed to provide true benefits for the patients, thereby creating true value also for the company's shareholders. My time at the helm at this amazing company has just begun and I look forward to keeping you updated on Alligator's developments on this exciting journey.
CEO Alligator Bioscience AB (publ)
Cash flow from operation activities, SEK million
Cash and cash equivalents including securities, SEK million
| Note | 2021 Apr–Jun |
2020 Apr–Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
||
|---|---|---|---|---|---|---|---|
| Result (TSEK) | |||||||
| Net sales | 5 | 3,777 | 4,352 | 4,394 | 4,352 | 4,352 | |
| Operating profit/loss | -34,492 | -34,709 | -67,013 | -79,562 | -144,298 | ||
| Profit/loss for the period | -34,959 | -35,052 | -67,700 | -77,932 | -143,296 | ||
| R&D costs | -27,810 | -29,347 | -50,285 | -61,875 | -110,252 | ||
| R&D costs as a percentage of operating costs excl. impairments | 72% | 73% | 70% | 73% | 73% | ||
| Capital (TSEK) | |||||||
| Cash and cash equivalents at end of period | 109,705 | 169,757 | 109,705 | 169,757 | 103,342 | ||
| Cash, cash equivalents and bonds at end of period | 109,705 | 169,757 | 109,705 | 169,757 | 103,342 | ||
| Cash flow from operating activities | -32,158 | -31,659 | -64,715 | -78,462 | -141,352 | ||
| Cash flow for the period | -33,960 | -33,176 | 6,395 | -27,726 | 9,386 | ||
| Equity at the end of the period | 122,275 | 180,581 | 122,275 | 180,581 | 115,244 | ||
| Equity ratio at the end of the period, % | 79% | 81% | 79% | 81% | 76% | ||
| Info per share (SEK) | |||||||
| Earnings per share before dilution | -0.41 | -0.49 | -0.79 | -1.09 | -2.01 | ||
| Earnings per share after dilution* | -0.41 | -0.49 | -0.79 | -1.09 | -2.01 | ||
| Equity per share before dilution | 1.43 | 2.53 | 1.43 | 2.53 | 1.61 | ||
| Equity per share after dilution* | 1.43 | 2.53 | 1.43 | 2.53 | 1.61 | ||
| Personnel | |||||||
| Number of employees at end of period | 45 | 56 | 45 | 56 | 43 | ||
| Average number of employees | 45 | 56 | 44 | 56 | 50 | ||
| Average number of employees employed within R&D | 40 | 49 | 39 | 48 | 43 |
*Effect from dilution is not considered when result is negative and options where call rate is higher than closing rate is not considered.
For definitions and calculations, see the sections later in this report.
Alligator Bioscience AB is a public Swedish biotech company that develops novel immunooncology drugs for tumor-directed immunotherapy, with the aim of providing more effective treatment with fewer side effects. The strategy is to develop drug candidates that selectively stimulate the immune system in the tumor, rather than the whole body. There is a major unmet medical need for novel and improved therapies in this area.
In 2020, the Company focused it operations on the clinical development portfolio with the aim of realizing the value of clinical drug candidates. The Company's innovation platform and drug research are being retained to ensure the Company's long-term value creation. Drug discovery at Alligator is being conducted by the Company's own personnel, but on a smaller scale than previously. To make the development as competitive and time efficient as possible, some of
this work is carried out in collaboration with other biotech companies, contract laboratories and leading international immuno-oncology research institutions. The clinical studies are carried out in collaboration with leading specialist physicians and CROs with expertise in clinical development. In summary, the Company has all the necessary expertise to pursue successful projects from concept to clinical phase.
Alligator's technology platforms – FIND® (protein optimization technology), ALLIGATOR-FABTM and ALLIGATOR-GOLD® (antibody libraries) – are used for the discovery and development of novel drug candidates. These platforms enable efficient generation of novel drug candidates with high potential. In addition, the Company has bispecific antibody formats for the development of new dual-action antibodies. With the most recent antibody format, RUBYTM, Alligator can generate bispecific molecules from any two antibodies, with excellent properties in terms of stability and yield. The format eliminates the need for further optimization, enabling Alligator to move drug candidates from preclinical research to clinical phase faster. One such example is the new Neo-X-PrimeTM drug concept that was launched in September 2020. The concept can be described as a personalized vaccination aimed at curing cancer. Research is highly promising and shows that Neo-X-PrimeTM has
the potential to create a very potent anti-tumor effect, superior to current therapeutic options. These technologies combined give Alligator a strong base for the development of bispecific, tumordirected drug candidates.
Alligator has four drug candidates in, or about to enter, clinical study phases, including the two key assets ATOR-1017 and mitazalimab. Mitazalimab has completed Phase I and is initiating Phase II. ATOR-1017 is in Phase I and has presented novel proof-of-mechanism data at the 2021 ASCO Annual Meeting. AC101, which is being developed by Shanghai Henlius Biotech Inc. in China and in which Alligator will share future revenues, is in Phase I. The bispecific antibody ALG.APV-527, which is being developed in partnership with Aptevo Therapeutics Inc., has completed all preclinical studies. The Company is planning to submit a Clinical Trial Application (CTA) for a Phase I clinical study in 2021.
In addition to these projects, Alligator develops the Neo-X-PrimeTM drug concept for more personalized immunotherapy. The concept was launched by Alligator in 2020 and one Neo-X-PrimeTM candidate drug is being developed in partnership with MacroGenics, Inc.
Alligator's research and development organization is divided into four units: Discovery, CMC (Chemistry, Manufacturing & Control), Non-Clinical Development and Clinical Development. The Discovery unit is responsible for early-stage research projects up until a drug candidate has been identified. This normally includes the development and evaluation of treatment concepts, the evaluation of potential drug candidates and early-stage efficacy screening. The CMC unit develops manufacturing processes and is responsible for clinical trial material manufacturing. The Non-Clinical Development unit supports the clinical projects and is responsible for preparation of the data packages required for clinical trial
applications. The Clinical Develop ment unit is responsible for designing and implementing all of the clinical studies required to show that Alligator's products are safe and effective. Alligator will continue to build and shape the organization to match and support its strategy and objectives.
The Company's business model is based on proprietary drug development. To maximize the value of the portfolio, the company intends to bring molecules from drug discovery and preclinical studies to demonstration of proof-of-concept in human clinical phase II trials. To generate income, limit portfolio risk and maximize long term value, the company will seek strategic global and regional partnerships for certain programs.
| DISCOVERY | PRECLINICAL | CLINICAL PHASE I | CLINICAL PHASE II | CLINICAL PHASE III |
|---|---|---|---|---|
| In the Discovery phase, Alligator generates new mono and bispecific antibodies with its ALLIGATOR-GOLD®, ALLIGATOR-FABTM, FIND® and RUBYTM technology platforms. |
In the preclinical phase, the safety and efficacy of the drug candidate are assessed as well as its clinical potential. These studies are conducted both internally at Alligator and |
The first human studies are performed with a small number of subjects, normally 20–80 patients with metastatic cancer. The primary endpoint of these studies is to show that the |
The endpoint of Phase II studies is to confirm the desired efficacy of the compound, and to determine the optimal dose. Normally, 100–300 patients are tested. |
In Phase III, the compound is tested on a larger group of subjects, normally 1,000–3,000 patients. |
| The phase also includes development and evaluation of treatment concepts, evaluation of potential drug candidates and early-stage efficacy studies. |
together with external partners. Alongside of preclinical activities, research continues to acquire a better understanding of the candidate's biological function. This phase |
compound is safe. How the drug is absorbed, distributed and metabolized is also studied. |
By the end of Phase II, the drug's efficacy, probable dosage and adverse effect profile should have been determined. |
The primary endpoint of Phase III studies is to confirm that the new drug is at least as good or better than standard therapies. By the end of Phase III, there is convincing |
| The antibodies are optimized to achieve set objectives in terms of function, binding affinity and stability, after which a drug candidate is selected for further development. |
also includes the manufacturing of material for upcoming clinical studies. |
evidence of the performance and common side effects of the drug, and the documenta tion required to register the drug has been compiled. |
The human CD40 agonistic antibody, mitazalimab, is Alligator's most advanced drug candidate for immunotherapy and is designed for the treatment of metastatic cancers, primarily pancreatic cancer. Mitazalimab stimulates the CD40 receptor on the surface of dendritic cells, enabling the immune system to attack tumors selectively. ADC-1013 MoA Mode of action
The Phase II OPTIMIZE-1 clinical study is assessing efficacy and safety of mitazalimab in combination with standard of care chemotherapy, mFOLFIRINOX, for treatment of first line metastatic pancreatic cancer. The chemotherapy cocktail mFOLFIRINOX kills tumor cells leading to increased release of tumor antigens. Activation of CD40 leads to improved presentation of tumor antigens, and the consequent activation of T cell-dependent anti-tumor responses. Mitazalimab has previously reported positive clinical data from two Phase I studies, one performed by Alligator, one performed by Janssen Biotech Inc., demonstrating early signs of efficacy, proof-of-mechanisms as well as a manageable safety profile. Dendritic cell
Preparations have continued to be able to include the first patient for the Phase II OPTIMIZE-1 clinical study. In June, the scientific journal Expert Opinion on Biological Therapy published an article
The OPTIMIZE-1 study is an open-label, multicenter study performed at clinical sites in Belgium and France and will include up to 67 patients. It is the first Phase II study with mitazalimab assessing the efficacy and safety of the drug in combination with chemotherapy in first line metastatic pancreatic cancer patients. First
interim readout is planned for H2 2021, and interim efficacy readout during H2 2022. To date, the clinical program has comprised two completed Phase I studies. The first study was conducted by Alligator with a focus on intratumoral administration. The results showed that clinically relevant doses of mitazalimab are well tolerated. Further promising safety and tolerability data from a second Phase I trial with mitazalimab in cancer patients was presented by Janssen Biotech, Inc. at the American Society of Clinical Oncology's (ASCO) Annual Meeting in 2019. The results showed that the adverse events were mild and mostly transient. The study comprised a total of 95 patients. Doses of up to 1,200 μg/kg i.v. with no premedication, and up to 2,000 μg/kg with premedication, were shown to be safe and tolerable. The results also gave indications of clinical activity. One renal cancer patient showed partial response (PR), while ten patients maintained stable disease (SD) for at least six months.
First cohort dosed in pancreatic cancer efficacy study OPTIMIZE-1.
Mitazalimab is a stimulatory antibody that targets CD40, a receptor on the immune system's dendritic cells, which are cells that recognize cancer cells in the body. Mitazalimab's stimulation of CD40 enables the dendritic cells to activate the immune system's weapons more effectively – in this case T cells – and to direct the immune system's attack specifically to the cancer cells. Mitazalimab has been optimized using Alligator's unique FIND® technology to achieve an effect even at very low doses. In preclinical models, mitazalimab has been shown to induce a potent tumor-targeted immune response and provide long-lasting tumor immunity. Preclinical results have also shown that mitazalimab can be used to treat many different types of cancer.
ATOR-1017 is a monoclonal antibody that stimulates the 4-1BB receptor on T cells and NK cells in the tumor region and has been developed for the treatment of metastatic cancer. 4-1BB has an ability to stimulate the immune cells that are key for tumor control. ATOR-1017 is being developed to improve combination therapy for metastatic cancer. Novel supportive data from the ongoing Phase I clinical trial was presented at the 2021 ASCO Annual Meeting. ATOR-1017 MoA (4-1BB) Mode of action
ATOR-1017 has a unique profile, including boosting the immunostimulatory effect in environments with high levels of immune cells, which occurs specifically in tumors. This creates an opportunity for potent, tumordirected immunostimulation that can increase the effect and reduce side effects for the patient. ATOR-1017 is a FcgR (Fc gamma Receptor) crosslinking dependent
In June Alligator presented novel supportive data from the ongoing Phase I clinical trial, validating the therapeutic potential of ATOR-1017 and demonstrating clear signs of proof of mechanism combined with a very favorable safety profile. Dose escalation continues in order to identify the optimal dose for subsequent phase II studies. Preparations for Phase II efficacy studies are ongoing, including involvement of CRO and establishing contact with leading effector T cells 4-1BB and FcgR co-expressing cells within the tumor leads to a tumor-dikey opinion leaders in the gastric cancer field at European Organisation for Research and Treatment of Cancer (EORTC). Tumor Killing
ATOR-1017 is being evaluated in a dose escalation study in patients with advanced solid cancer (NCT04144842). The study is taking place at three medical centers in Sweden, and the primary endpoint is to assess the safety and tolerability of ATOR-1017 and determine a recommended dose for subsequent Phase II studies. The first patient was dosed in December 2019. As of data cut-off March 31, 2021, a total of 13 patients with varying advanced solid malignancies had been included. 4 patients (31 percent) remained on treatment, 3 (23 percent) of whom had confirmed stable disease for a period of 3.5-12.5 months. The results from the eval-Tumor Cell T cell Macrophage
uation of doses up to and including 200 mg, presented in a poster presentation at the 2021 ASCO Annual Meeting, demonstrate that ATOR-1017 has an encouraging safety profile as the drug related adverse events in the study have generally been mild and transient.
No dose-limiting toxicity or severe immune-related adverse events have been reported. The results further demonstrate that ATOR-1017 exhibits a favorable pharmacokinetic profile with linear elimination and no accumulation. Activation of T cells in the circulation was observed across therapeutic dose levels of ATOR-1017 demonstrating biological activity and proof of mechanism. Previous interim data from the ongoing Phase I study, presented in the autumn of 2020, showed a promising safety profile for ATOR-1017 with only a few drug-related side effects, all of which were mild or moderate (grade 1 or 2). Large volumes of preclinical data have been presented showing that ATOR-1017 stimulates both natural killer (NK) and T cells, both of which contribute to an effective immune-mediated killing of tumor cells.
Results from clinical Phase I study. Initiation (CTA submission) of Phase II efficacy study.
ATOR-1017 differs from other 4-1BB antibodies, partly because of its unique binding profile, but also because its immuno-stimulatory function is dependent on crosslinking to Fc-gamma receptors on immune cells. This localizes the immunostimulation to the tumor region where both 4-1BB and Fc-gamma receptors are expressed at high levels, which is entirely in line with the treatment strategy for Alligator's drug candidates. The aim is to achieve an effective tumor-directed immune response with minimum side effects.
ALG.APV-527 is a bispecific antibody that targets the 4-1BB and 5T4 molecules, designed for the treatment of metastatic cancer.
The drug candidate has been co-developed with Aptevo Therapeutics Inc. since 2017, and preparations are under way to submit a CTA to initiate clinical testing.
In November 2020, preclinical data for ALG.APV-527 were presented at the Society for Immunotherapy of Cancer's (SITC) Annual Meeting. Data shows that ALG.APV-527 has a positive safety profile, with no signs of systemic immunostimulation or liver toxicity. ALG.APV-527 also increases the anti-tumor response and induces a tumor-specific immunologic memory in experimental disease models. It has already been shown that ALG.APV-527 has the potential to selectively stimulate and strengthen the T-cell response in the tumor without stimulating the immune system in the rest of the body. Overall, the results support the potential of ALG.APV-527 to induce effective tumor-targeted immunostimulation with fewer adverse events.
In July 2017, Aptevo Therapeutics and Alligator Bioscience AB signed an agreement regarding the co-development of ALG.APV-527. Under the agreement, both companies will own and finance the development. The original molecules involved in the tumor-binding function and the immunomodulatory function of ALG.APV-527 were developed using Alligator's patented ALLIGATOR-GOLD® antibody library. The bispecific molecule was further developed and improved with Aptevo's technology platform ADAPTIR™. A tumor-binding function was combined with an immunomodulatory function in the same molecule to create a drug candidate that can selectively target the tumor and stimulate the antitumor-specific immune cells that are found there.
Submit CTA as preparation for Phase I clinical trials.
Neo-X-PrimeTM is a drug concept for more personalized immunotherapy, launched by Alligator in 2020. The concept builds on bispecific antibodies that physically link circulating tumor material to the immune system, to allow neoantigen-specific T cell priming with potential for superior anti-tumor efficacy.
In April 2021 Alligator entered into a joint research collaboration with US-based MacroGenics, Inc. a Nasdaq listed biopharmaceutical company focused on developing and commercializing innovative monoclonal antibody-based therapeutics for the treatment of cancer. The research collaboration utilizes Alligator's proprietary patient specific immunotherapy Neo-X-Prime™ to develop bispecific antibodies against two undisclosed targets.
Under the joint research collaboration agreement, which covers activities from candidate drug generation up until IND-enabling studies, each company will be responsible for its own costs. The parties may continue further development of the resulting bispecific molecule under a separate co-development collaboration and licensing agreement.
Through its subsidiary Atlas Therapeutics AB, Alligator holds a participating interest in the clinical Biosynergy (AC101/HLX22) project, run by the listed Korean Company AbClon. The drug candidate is now being further developed by the Chinese Company Shanghai Henlius, which increased its rights to encompass a global license for development and commercialization in 2018. Alligator incurs no overheads for this project and is entitled to 35 percent of AbClon's revenue from out-licensing to Shanghai Henlius. In previous financial years, Alligator received two milestone payments totaling USD 3 million in conjunction with regional and global out-licensing of one of these products, the HER2 anti-body AC101. AC101 is since 2019 undergoing testing in Phase I.
In August 2019, an agreement was concluded with Chinese company Biotheus. Biotheus obtained the Chinese rights (Greater China, Hong Kong, Taiwan and Macao) to an antibody from the ALLIGATOR-GOLD® antibody library. The agreement gives Alligator the right to total initial upfront payments, and milestone and option payments of potentially USD 142 million. To date, Alligator has received upfront payments of about SEK 10 million, for events such as positive results after an initial evaluation period.
Drug development is costly, and there is a significant risk that a drug candidate will fail to reach the market. A drug candidate could, for example, demonstrate unacceptable side effects or lack the intended therapeutic effect. In bio-tech companies, the financing risk is always present due to the long development timelines.
Alligator's drug candidates are tumor-directed, meaning that the risk of serious side effects is inherently lower than for drugs that works systemically. As Alligator develops drug candidates for different target molecules chances of success for the portfolio are high. The clinical success of the portfolio, is not dependent on the ability of a specific combination of antibodies/target molecules to show clinical efficacy.
Immuno-oncology is now established as an effective form of therapy and an area with substantial potential. This was apparent, not least, in the 2018 Nobel Prize in Medicine, which was awarded to James P. Allison and Tasuku Honjo, two pioneers in the field.
Alligator is pursuing a long-term and highly intensive business development program and since 2015 has generated income of approximately USD 50 million in the form of upfront payments and milestone payments. The objective is to have several outlicensed projects, which may generate significant income in the form of upfront payments and milestone payments.
For a more detailed review of how Alligator mitigates risks, see page 45 of the 2020 Annual Report.
One in five men and one in six women worldwide will at some stage of their lives develop cancer. Every year, about 18 million people are diagnosed with cancer and approximately 10 million people die of cancer (Globocan 2018). This means there is a major unmet need for advanced cancer care. Alligator's ambition is to develop immuno-oncology drugs that can save lives all over the world.
The global cancer therapy market is valued at USD 140 billion (2019). Immuno-oncology is one of the fastest growing areas and the global market for cancer immunotherapies is expected to dominate the market in the future and grow from USD 29 billion in 2019 to close to USD 120 billion in 2026. As an example, sales of Merck's drug Keytruda® alone amounted to USD 11.1 billion in 2019 (USD 7.1 billion in 2018). Source: GlobalData, 2020.
Alligator's pipeline and technology platform provides several opportunities for generating licensing income to support the Company's core activities. These include out-licensing of the Neo-X-PrimeTM technology platform, as well as global and regional deals on our clinical programs including mitazalimab, ALG.APV-527 and ATOR-1015. Alligator also sees opportunities for interesting deals using its broad knowledge and unique technology platform, on which the Company's development of unique antibodies is based.
Alligator possesses a very high innovation capacity. The Company's Discovery unit develops tumor-targeted immunotherapies focusing on active therapies that provide long-lasting tumor-specific immunity. The unit's most important assets are its world-class researchers and a unique technology platform, which can be seen as the Company's innovation engine, where future immunooncology drugs are already being developed.
The total number of outstanding shares in the Company at the end of the quarter was 85,666,338 (71,388,615).
At the 2018 AGM, it was decided to set up an employee option program whereby 2,275,000 employee options were allotted free of charge to participants. The employee options has been be vested in installments up to May 1, 2021. Vesting was subject to the participant remaining in the Company's employment and not having resigned on a given qualifying date. Of the allotted employee options, 1,767,500 have been vested and 507,500 have lapsed since the individuals to whom they were allotted have since left the Company. To secure delivery under the employee stock option program, and to cover ancillary costs, primarily social security contributions, a total of 2,989,805 warrants were issued to a subsidiary of which 2,275,000 were allotted to employees free of charge and 714,805 were issued to cover ancillary costs. As a result of lapsed warrants, a total of maximum 2,322,849 warrants can be exercised in the program. Each warrant in the program entitles the holder to acquire 1.03 new shares at an exercise price of SEK 73.01. The warrants are expected to be available to exercise one month after the publication of the first quarter reports for 2021 and 2022. Upon full exercise of all warrants issued in respect of the share subscription incentive programs, a total of 2,392,534 shares will be issued, thereby increasing the number of shares to a maximum of 88,058,872, corresponding a to dilution by 2.7 percent.
At the 2021 AGM, it was decided to implement a long-term incentive program in the form of a performance-based share saving program (the "LTI 2021") for employees in the Company. Following a predefined time period, the participants will, free of charge, have the right to receive additional shares in the Company ("Matching Shares"). In addition, conditional upon fulfilment of a goal related to the development of the share price, the participants will further, free of charge, have the right to receive additional shares in the Company ("Performance Shares"). The investment in Saving Shares shall be made through acquisition of ordinary shares on the stock market on 30 September 2021 at the latest.
The total number of Matching Shares will not exceed 175,500 and the total number of Performance Shares will not exceed 702,000, meaning that the total number of shares that can be issued to the participants in connection with LTI 2021 will not exceed 877,500. The maximum number of shares that can be issued in relation to LTI 2021 is 1,153,211, where of 877,500 for delivery of Matching Shares and Performance Shares to the participants and in the aggregate 275,711 related to hedging of cash flow for social security contributions, which corresponds to a dilution of approximately 1.3 percent of the Company's share capital and votes after full dilution, calculated on the number of shares that will be added upon full issuance of shares in connection with LTI 2021.
In case both the existing employee option program and the proposed LTI 2021 are exercised in full, a total of 3,545,745 new shares will be issued, which corresponds to a total dilution of approximately 4.0 percent of the Company's share capital and votes after full dilution, calculated on the number of shares that will be added upon full exercise of the outstanding employee options as well as the share saving program.
| Listed on: | Nasdaq Stockholm Small Cap |
|---|---|
| Number of shares: | 85,666,338 |
| Average turnover per day: | Approximately 154,000 (preceding quarter: approx. 123,000) |
| Number of shareholders: | 8,100 (preceding quarter: approx. 8,100) |
| Market capitalization: | SEK 471 million (preceding quarter: approx. SEK 533 million) |
| Ticker: | ATORX |
| ISIN: | SE0000767188 |
| Number of shares |
% | |
|---|---|---|
| Union Bancaire Privee, UBP SA | 10,710,162 | 12.5 |
| Sunstone Life Science Ventures Fund II K/S | 5,758,485 | 6.7 |
| Banque Internationale à Luxembourg SA | 4,510,101 | 5.2 |
| Lars Spånberg | 3,856,629 | 4.5 |
| Försäkringsbolaget Avanza pension | 3,463,333 | 4.0 |
| Johnson & Johnson Innovation | 2,740,919 | 3.2 |
| Fjärde AP-fonden | 2,727,819 | 3.2 |
| Nordnet pensionsförsäkring | 2,255,886 | 2.6 |
| Öhman fonder | 1,859,674 | 2.2 |
| Mikael Lönn | 1,730,619 | 2.0 |
| Other shareholders | 46,052,711 | 53.9 |
| Total number of shares | 85,666,338 | 100.0 |
Union Bancaire Privee, (UBP) and Banque Internationale à Luxembourg SA (BIL) is a group of mainly Swedish investors with their shares managed by UBP or BIL.
The Company's owner structure is updated monthly on the Company's website: www.alligatorbioscience.com.
Source: Shareholder data is based on a report from Euroclear and Monitor (Modular Finance) as of June 30, 2021, where certain foreign accounts have been identified by the Company.
This report has not been reviewed by the Company's auditor.
The number of employees in the Group at the end of the quarter was 45 (43). Of these, 10 (8) were men and 35 (35) were women. Of the total number of employees at the end of the quarter 40 (38) were employed within research and development.
Alligator intends to publish its financial reports according to the following:
During the course of its business operations, the Group is exposed to various financial risks, such as market risk (comprising foreign exchange risk, interest-rate risk and price risk), credit risk and liquidity risk. The aim of the Group's overall risk management is to achieve minimal adverse effects in terms of earnings and financial position. The Group's business risks, risk management and financial risks are described in detail in the Annual report for 2020.
The ongoing Covid-19 pandemic affected Alligator's operations during the spring, with temporary holds in patient enrollment for the company's clinical studies. Despite this, we see that we have good opportunities to keep our planned timelines in terms of study read-outs.
The Company works continuously to secure the financing of the operation. This include both business development for new partnering agreements, with an upfront payment upon signing, as well as other options. Following the Company´s savings program during the first half of the year, together with the now completed rights issue, the Company's assessment is that the financial resources are sufficient for the coming 12 months.
Even though the board and management believe the expectations in this report are justified, no guarantees can be given that they will turn out to be correct. Accordingly, the actual outcome may differ significantly from the assumptions stated in the forwardlooking information depending on, among other factors, changes in the economy or market, changes in legal or regulatory demands, political decisions and changes in exchange rates.
Both Group management functions and all operating activities are carried out in the Parent Company. For additional details, refer to the information provided for the Group since the subsidiaries do not conduct their own operations.
Figures in brackets refer to the outcome for the corresponding period in the preceding year for figures related to the income statement and cash flow. For figures related to the financial position and personnel, figures in brackets refer to December 31, 2020. Unless otherwise stated, all amounts stated are rounded correctly, which may mean that some totals do not tally exactly.
FIND® and ALLIGATOR-GOLD® are Alligator Bioscience AB proprietary trademarks which are registered in Sweden and other countries.
Søren Bregenholt, CEO Email: [email protected] Phone: +46 46 540 82 00
Marie Svensson, CFO Email: [email protected] Phone: +46 46 540 82 03
Medicon Village, Scheelevägen 2 223 81 Lund, Sweden Phone: +46 46 540 82 00 www.alligatorbioscience.com
Unless otherwise stated, this Interim report to the Group. Due to the nature of the business, there can be large fluctuations in revenue which are not seasonal or regular but are mainly linked to when milestones generating a payment are reached in out-licensed research projects. Like revenue, expenses can also fluctuate between periods. Among other factors, this fluctuation in expenses is influenced by the current phase of the various projects since certain phases generate higher costs. Figures in brackets refer to the outcome for the corresponding period in the preceding year for figures related to the income statement and cash flow. For figures related to the financial position and personnel, figures in brackets refer to December 31, 2020. Unless stated otherwise, all amounts are in SEK thousand (TSEK). All amounts stated are rounded, which may mean that some totals do not tally exactly.
Sales for the period pertain primarily to the licence agreement with Biotheus Inc and and to the joint research agreement with BioArctic AB. In the same periods prior year sales pertained primarily to the licence agreement with Biotheus Inc .
Other operating income for the quarter comprises primarily of exchange gains in the company's operations In the same period prior year, revenue comprised exchange gains in the company's operations.
The company's costs are aproximatelly in the same level compared to the previous year, and pertain mainly to costs related to clinical projects mitazalimab and ATOR-1017. The personnel costs in the second quarter is lower than last year due to strategic desicion to reduce preclinical expenses including a reduction in workforce.
Pertains to unrealized exchange gains and losses as a result of significant liquidity positions in USD, EUR and GBP.
| TSEK | Note | 2021 Apr–Jun |
2020 Apr-Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
|---|---|---|---|---|---|---|
| Net sales | 5 | 3,777 | 4,352 | 4,394 | 4,352 | 4,352 |
| Other operating income | 5 | 129 | 1,250 | 317 | 1,279 | 2,315 |
| Total operating income | 3,907 | 5,601 | 4,711 | 5,630 | 6,666 | |
| Operating costs | ||||||
| Other external costs | -19,992 | -20,157 | -37,632 | -45,251 | -82,320 | |
| Personnel costs | -15,044 | -16,942 | -28,291 | -33,101 | -55,710 | |
| Depreciation of tangible assets and intangible assets | -3,277 | -2,900 | -5,607 | -5,765 | -11,522 | |
| Other operatings expenses | -85 | -311 | -194 | -1,076 | -1,413 | |
| Total operating costs | -38,399 | -40,310 | -71,724 | -85,192 | -150,964 | |
| Operating profit/loss | -34,492 | -34,709 | -67,013 | -79,562 | -144,298 | |
| Financial items | ||||||
| Result from other securities and receivables | - | - | - | 192 | 192 | |
| Other interest income and similar income statement items | - | - | -9 | 1,992 | 2,001 | |
| Interest expense and similar income statement items | -467 | -342 | -678 | -554 | -1,191 | |
| Net financial items | -467 | -342 | -687 | 1,630 | 1,002 | |
| Profit/loss before tax | -34,959 | -35,052 | -67,700 | -77,932 | -143,296 | |
| Tax on profit for the period | - | - | - | - | - | |
| Profit for the period attributable to Parent Company hareholders | -34,959 | -35,052 | -67,700 | -77,932 | -143,296 | |
| Earnings per share | ||||||
| Earnings per share before dilution, SEK | -0,41 | -0,49 | -0,79 | -1,09 | -2,01 | |
| Earnings per share after dilution, SEK | -0,41 | -0,49 | -0,79 | -1,09 | -2,01 | |
| TSEK | Note | 2021 | 2020 | 2021 | 2020 | 2020 |
| TSEK | Note | 2021 Apr–Jun |
2020 Apr-Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
|---|---|---|---|---|---|---|
| Profit/loss for the period | -34,959 | -35,052 | -67,700 | -77,932 | -143,296 | |
| Other comprehensive income | - | - | - | - | - | |
| Comprehensive income for the period | -34,959 | -35,052 | -67,700 | -77,932 | -143,296 |
Consolidated cash and cash equivalents, which consist of bank balances, totaled SEK 109,705 thousand (103,342).
The Group plans to use its liquidity for operating activities. A portion of the Group's liquidity is invested in USD, EUR and GBP foreign currency accounts. In accordance with the Group's Financial Policy, inflows of foreign currencies exceeding the expected requirements for the coming 18 months are to be converted to SEK at the time of payment. Besides this, no further hedging has taken place.
| TSEK | Note | 2021-06-30 | 2020-06-30 | 2020-12-31 |
|---|---|---|---|---|
| ASSETS | ||||
| Fixed assets Intangible assets |
| Total fixed assets | 33,677 | 46,355 | 41,593 | ||||
|---|---|---|---|---|---|---|---|
| Equipment and machinery | 6,337 | 10,898 | 8,600 | ||||
| Right of use assets | 8,183 | 15,462 | 13,423 | ||||
| Improvements in leased premise | 913 | 1,521 | 1,217 | ||||
| Tangible assets | |||||||
| Softwares | 267 | 398 | 332 | ||||
| Patents | 29 | 127 | 72 | ||||
| Participations in development projects | 3 | 17,949 | 17,949 | 17,949 | |||
Current assets
Current receivables
| Total current assets | 121,782 | 175,759 | 110,345 | |
|---|---|---|---|---|
| Cash and cash equivalents | 6 | 109,705 | 169,757 | 103,342 |
| Prepayments and accrued income | 6,210 | 1,787 | 2,079 | |
| Other receivables | 6 | 5,867 | 4,215 | 4,924 |
| TOTAL ASSETS 155,459 222,113 151,938 |
|---|
| ----------------------------------------------- |
Equity at the end of the period amounted to SEK 122,275 thousand (115,244), corresponding to an equity ratio of 79 percent (76).
In January 2021, the Company carried out a rights issue SEK 85,666 thousand. Through the rights issue, the number of shares in the Company increases by 14,277,723 shares, from 71,388,615 shares to 85,666,338 shares. The rights issue entails a dilution of approximately 16.67 percent for shareholders who are not participating in the rights issue.
At the end of the period, equity per outstanding share amounted to SEK 1.43 (1.61), before and after dilution. Since the subscription price for issued options has not been reached, these are not taken into account (not "in-the-money").
At the end of the period, right of use assets amounted to SEK 8,183 thousand (13,423) and lease liabilities amounted to SEK 8,426 thousand (12,073). Both right of use assets and lease liabilities pertain primarly to leases for offices and laboratories. No loans had been raised as of June 30 2021 and no loans have been raised since that date. The Group has no loans or loan commitments.
At the end of the period, accrued expenses and deferred income amounted to SEK 20,055 thousand (16,070). Expenses pertains to accrued expenses for clinical activities, personnel and other expenses.
| TSEK | Note | 2021-06-30 | 2020-06-30 | 2020-12-31 |
|---|---|---|---|---|
EQUITY AND LIABILITIES
| Equity | |||
|---|---|---|---|
| Share capital | 34,267 | 28,555 | 28,555 |
| Other capital contributions | 731,765 | 662,614 | 662,614 |
| Retained earnings and profit/loss for the period | -643,757 | -510,589 | -575,926 |
| Equity attributable to Parent Company shareholders | 122,275 | 180,581 | 115,244 |
| Lease Liabilities | 6 | 2,573 | 8,318 | 5,841 |
|---|---|---|---|---|
| Other long-term liabilities | 6 | 145 | 279 | 135 |
| Total non-current provisions and liabilities | 2,718 | 8,597 | 5,975 |
| TOTAL EQUITY AND LIABILITIES | 155,459 | 222,113 | 151,938 | |
|---|---|---|---|---|
| Total current liabilities | 30,466 | 32,935 | 30,719 | |
| Accrued expenses and deferred income | 6 | 20,055 | 21,552 | 16,070 |
| Lease liabilities | 6 | 5,853 | 5,853 | 6,232 |
| Other liabilities | 1,295 | 1,194 | 1,879 | |
| Accounts payable | 6 | 3,263 | 4,336 | 6,538 |
| TSEK | Note | 2021 Apr-Jun |
2020 Apr-Jun |
20201 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
|---|---|---|---|---|---|---|
| Opening balance | 157,246 | 215,671 | 115,244 | 258,498 | 258,498 | |
| New capital issue | - | - | 85,666 | - | - | |
| Option premiums received | - | - | - | - | - | |
| Underwriting expenses | -1 | - | -10,931 | - | - | |
| Effect of share-based payments | -11 | -39 | -4 | 14 | 42 | |
| Profit/loss for the period | -34,959 | -35,052 | -67,700 | -77,932 | -143,296 | |
| Other comprehensive income in the period | - | - | - | - | - | |
| Closing balance | 122,275 | 180,581 | 122,275 | 180,581 | 115,244 |
No investments were made during the quarter.
Cash flow for the quarter totaled SEK -33,960 thousand (-33,176).
| Apr-Jun Apr-Jun Jan-Jun Jan-Jun |
TSEK | Note | 2021 | 2020 | 2021 | 2020 | 2020 Jan-Dec |
|---|---|---|---|---|---|---|---|
| ------------------------------------------ | ------ | ------ | ------ | ------ | ------ | ------ | ----------------- |
| Tax paid | - | - | - | -189 - |
- |
|---|---|---|---|---|---|
| Interest paid | -411 | -93 | -660 | -347 | |
| Interest received | - | - | - | 218 | 218 |
| Other items, no impact on cash flow | 33 | - | -18 | 180 | - |
| Effect from warrant program | -11 | -39 | -4 | 14 | 42 |
| Depreciation and impairments | 3,277 | 2,900 | 5,607 | 5,765 | 11,522 |
| Adjustments for items not generating cash flow | |||||
| Operating profit/loss | -34,492 | -34,709 | -67,013 | -79,562 | -144,298 |
| Cash flow from operating activities | -32,158 | -31,659 | -64,715 | -78,462 | -141,352 |
|---|---|---|---|---|---|
| Change in operating liabilities | 2,126 | -863 | 284 | -8,007 | -10,608 |
| Change in operating receivables | -2,681 | 1,146 | -2,911 | 3,120 | 2,119 |
| Cash flow from investing activities | - | - | - | 156,988 | 156,886 |
|---|---|---|---|---|---|
| Divestment of other short-term investments | - | - | - | 103,160 | 103,160 |
| Divestment of securities | - | - | - | 53,828 | 53,828 |
| Acquisition of tangible assets | - | - | - | - | -102 |
| Cash flow from financing activities | -1,803 | -1,517 | 71 109 | -3,092 | -6,148 |
|---|---|---|---|---|---|
| Underwriting expenses | -1 | - | -10,931 | - | - |
| New share issue | - | - | 85,666 | - | - |
| Amortization of installment purchase | -75 | -72 | -504 | -210 | -354 |
| Amortization of leasing liabilities | -1,726 | -1,445 | -3,122 | -2,882 | -5,794 |
| Cash flow for the period | -33,960 | -33,176 | 6,395 | 75,434 | 9,386 |
|---|---|---|---|---|---|
| Cash and cash equivalents at beginning of period | 143,660 | 203,218 | 103,342 | 93,890 | 93,890 |
| Exchange rate differences in cash and cash equivalents | 6 | -285 | -31 | 613 | 145 |
| Cash and cash equivalents at end of period | 109,705 | 169,757 | 109,705 | 169,757 | 103,342 |
| TSEK | Note | 2021 Apr-Jun |
2020 Apr-Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
|---|---|---|---|---|---|---|
| Net sales | 3,777 | 4,352 | 4,394 | 4,352 | 4,352 | |
| Other operating income | 129 | 1,250 | 317 | 1,279 | 2,315 | |
| Total operating income | 3,907 | 5,601 | 4,711 | 5,630 | 6,666 | |
| Operating costs | ||||||
| Other external costs | -22,021 | -21,681 | -40,677 | -48,297 | -88,416 | |
| Personnel costs | -15,044 | -16,942 | -28,291 | -33,101 | -55,710 | |
| Depreciation and impairment of tangible assets and intangible assets | -1,323 | -1,434 | -2,675 | -2,833 | -5,658 | |
| Other operatings expenses | -85 | -311 | -194 | -1,076 | -1,413 | |
| Total operating costs | -38,472 | -40,368 | -71,837 | -85,306 | -151,196 | |
| Operating profit/loss | -34,566 | -34,767 | -67,126 | -79,676 | -144,530 | |
| Results from financial items | ||||||
| Result from participation in Group companies | - | 12,500 | - | 12,500 | 12,500 | |
| Result from other securities and receivables | - | - | - | 192 | 192 | |
| Other interest income and similar income statement items | - | - | -9 | 3,003 | 3,012 | |
| Interest expense and similar income statement items | -75 | -262 | -37 | -386 | -881 | |
| Net financial items | -75 | 12,238 | -46 | 15,308 | 14,822 | |
| Profit/loss after financial items | -34,641 | -22,530 | -67,172 | -64,368 | -129,708 | |
| Appropriations | ||||||
| Group contribution received | - | - | - | - | 438 | |
| Total appropriations | - | - | - | - | 438 | |
| Result before tax | -34,641 | -22,530 | -67,172 | -64,368 | -129,270 | |
| Tax on profit for the year | - | - | - | - | - | |
| Profit/loss for the period | -34,641 | -22,530 | -67,172 | -64,368 | -129,270 | |
| TSEK | Note | 2021 Apr-Jun |
2020 Apr-Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
| TSEK | Note | 2021 Apr-Jun |
2020 Apr-Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
|---|---|---|---|---|---|---|
| Profit/loss for the period | -34,641 | -22,530 | -67,172 | -64,368 | -129,270 | |
| Other comprehensive income | - | - | - | - | - | |
| Profit/loss for the year | -34,641 | -22,530 | -67,172 | -64,368 | -129,270 |
| TSEK | Note | 2021-06-30 | 2020-06-30 | 2020-12-31 |
|---|---|---|---|---|
| ASSETS | ||||
| Fixed assets Intangible assets |
||||
| Patents | 29 | 127 | 72 | |
| Software | 267 | 398 | 332 | |
| Total intangible assets | 296 | 525 | 405 | |
| Tangible assets | ||||
| Improvements in leased premise | 913 | 1,521 | 1,217 | |
| Equipment and machinery | 6,337 | 10,898 | 8,600 | |
| Total tangible assets | 7,250 | 12,419 | 9,817 | |
| Financial assets | ||||
| Participations in Group companies | 3 | 20,294 | 20,294 | 20,294 |
| Total financial assets | 20,294 | 20,294 | 20,294 | |
| Total fixed assets | 27,840 | 33,238 | 30,515 | |
| Current assets Current receivables |
||||
| Receivables from Group companies | 438 | - | 438 | |
| Other receivables | 5,867 | 4,215 | 4,923 | |
| Prepayments and accrued income | 6,745 | 3,311 | 3,688 | |
| Total current receivables | 13,050 | 7,526 | 9,050 | |
| Cash and bank deposits | 108,840 | 168,888 | 102,473 | |
| Total current assets | 121,889 | 176,414 | 111,523 | |
TOTAL ASSETS 149,729 209,651 142,038
| TSEK | Note | 2021-06-30 | 2020-06-30 | 2020-12-31 |
|---|---|---|---|---|
| EQUITY AND LIABILITIES | ||||
| Equity Restricted equity |
||||
| Share capital | 34,267 | 28,555 | 28,555 | |
| Total restricted equity | 34,267 | 28,555 | 28,555 | |
| Non-restricted equity | ||||
| Share premium reserve | 731,765 | 662,741 | 662,741 | |
| Retained earnings | -573,888 | -444,639 | -444,611 | |
| Profit/loss for the period | -67,172 | -64,368 | -129,270 | |
| Total non-restricted equity | 90,705 | 153,735 | 88,861 | |
| Total equity | 124,971 | 182,290 | 117,416 | |
| Non-current provisions and liabilities | ||||
| Other long-term liabilities | 284 | 571 | 432 | |
| Total non-current provisions and liabilities | 284 | 571 | 432 | |
| Current liabilities | ||||
| Accounts payable | 3,263 | 4,336 | 6,538 | |
| Other liabilities | 1,155 | 902 | 1,582 | |
| Accrued expenses and deferred income | 20,055 | 21,552 | 16,070 | |
| Total current liabilities | 24,474 | 26,790 | 24,190 | |
| TOTAL EQUITY AND LIABILITIES | 149,729 | 209,651 | 142,038 |
This Interim report covers the Swedish Parent Company Alligator Bioscience AB (publ), corporate registration number 556597-8201, and its subsidiaries Atlas Therapeutics AB, corporate registration number 556815-2424, and A Bioscience Incentive AB, corporate registration number 559056-3663. All the Group's business operations are carried out in the Parent Company.
The Parent Company is a Swedish public limited liability company registered and domiciled in the Municipality of Lund. The head office is located at Medicon Village, SE-223 81 Lund.
This Interim report for the Group has been prepared in accordance with IAS 34 Interim Financial Reporting and applicable regulations in the Swedish Annual Accounts Act (ÅRL). The Interim report for the Parent Company has been prepared in accordance with the Swedish Annual Accounts Act (ÅRL) and the Swedish Financial Reporting Board's recommendation RFR 2 Accounting for Legal Entities.
The accounting policies and calculation methods used in this report are the same as those described in the Annual report for 2020.
Significant estimates and judgments are described in Note 3 and Note 19 of the Annual report for 2020. There have been no changes to the company's estimates and judgments since the Annual report for 2020 was prepared.
The company conducts only one business activity, namely research and development in the field of immunotherapy, and the chief operating decision-maker is thus only responsible for regularly making decisions on and allocating resources to one entity. Accordingly, the company comprises only one operating segment, which corresponds to the Group as a whole, and no separate segment reporting is provided.
A breakdown of the Group's revenue regarding license revenue is as follows:
| All amounts in TSEK | 2021 Apr–Jun |
2020 Apr–Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
|---|---|---|---|---|---|
| Licensing income | 2,094 | 4,352 | - | 4,352 | 4,352 |
| Total | 2,094 | 4,352 | - | 4,352 | 4,352 |
A breakdown of the Group's revenue per project is as follows:
| All amounts in TSEK | 2021 Apr–Jun |
2020 Apr–Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
|---|---|---|---|---|---|
| Bioarctic | 1,600 | - | 1,600 | - | - |
| Biotheus | 2,094 | 4,352 | 2,094 | 4,352 | 4,352 |
| Total | 3,694 | 4,352 | 3,694 | 4,352 | 4,352 |
A breakdown of the Group's other operating income is as follows:
| All amounts in TSEK | 2021 Apr–Jun |
2020 Apr–Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
|---|---|---|---|---|---|
| Swedish government grants received | - | 719 | - | 719 | 1,163 |
| Operational exchange rate gains | 129 | 530 | 317 | 559 | 1,151 |
| Other | 83 | 1 | 700 | 1 | 1 |
| Total | 212 | 1,250 | 1,017 | 1,279 | 2,315 |
Cash and cash equivalents at June 30, 2021 consisted of bank balances amounting to SEK 109,705 thousand (103,342). For financial assets and liabilities, the reported value as below is considered a reasonable approximation of fair value.
| All amounts in TSEK | 2021-06-30 | 2020-06-30 | 2020-12-31 | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Financial assets valued at amortized cost | |||||||||
| Other receivables | 1,505 | 1,257 | 832 | ||||||
| Liquid assets - Bank accounts | 109,705 | 169,757 | 103,342 | ||||||
| Total financial assets | 111,210 | 171,014 | 104,175 | ||||||
| Financial liabilities valued at amortized cost | |||||||||
| Long-term lease liabilities | 2,573 | 8,318 | 5,841 | ||||||
| Other long-term liabilities | 145 | 279 | 135 |
Accounts payable 3,263 4,336 6,538 Short-term lease liabilities 5,853 5,853 6,232 Other short-term liabilities 139 292 297 Accrued expenses 12,019 16,398 10,081 Total financial liabilities 23,993 35,476 29,124
Alligator has a consulting agreement with Carl Borrebaeck through the company Ocean Capital AB pertaining to expert assistance with the evaluation of early-phase research projects and new antibodies. Carl Borrebaeck also plays an important role in building and developing contacts with leading researchers and prominent organizations within cancer immunotherapy. Pricing has been determined on market conditions. These related party transactions corresponded to an expense of SEK 180 thousand (180) for the second quarter 2021. Carl Borrebaeck resigned from the Board of Directors at his own request on April 30, 2021.
Equity divided by the total number of shares at the end of the period and any outstanding options where the Company's share price on the reporting date is at least equal to the conversion price of the option.
Equity divided by the number of shares at the end of the period.
The Company's direct costs for research and development. Refers to costs for personnel, materials and external services.
R&D costs as a percentage of operating costs excluding impairments.
Average number of outstanding shares during the period. The number of shares after dilution also takes account of outstanding options where the Company's share price on the reporting date is at least equal to the conversion price of the option.
Average number of employees at the beginning and end of the period.
Average number of employees within the Company's R&D departments at the beginning and end of the period.
Cash flow before investing and financing activities.
Cash and cash equivalents consists of bank balances, interest funds and publicly traded corporate bonds.
Net change in cash and cash equivalents excluding the impact of unrealized foreign exchange gains and losses.
Earnings divided by the weighted average number of shares during the period before and after dilution respectively. If the result is negative, the number of shares before dilution is also used for the calculation after dilution.
Other external costs, personnel costs and depreciation (excluding impairments of tangible and intangible assets).
Operating profit/loss Profit/loss before financial items and taxes.
Total assets Total of the Company's assets.
Alligator presents certain financial performance measures in this report, including measures that are not defined under IFRS. The Company believes that these performance measures are an important complement because they allow for a better evaluation of the Company's economic trends. These financial performance measures should not be viewed in isolation or be considered to replace the performance indicators that have been prepared in accordance with IFRS. In addition, such performance measures as Alligator has defined them should not be compared with other performance measures with similar names used by other companies. This is because the above-mentioned performance measures are not always defined in the same manner, and other companies may calculate them differently to Alligator.
Below is shown the calculation of key figures, for the mandatory earnings per share according to IFRS and also for performance measures that are not defined under IFRS or where the calculation is not shown in another table in this report.
The Company's business operation is to conduct research and development which is why "R&D costs/Operating costs excluding impairment in percent" is an essential indicator as a measure of efficiency, and how much of the Company's costs relate to R&D.
After the initial public offering, the Company had a surplus of liquidity. To get a rate of return, a certain proportion of the Company's liquidity was invested in listed corporate bonds. The Company uses cash and cash equivalents including securities as a financial performance measure to monitor the Company's liquid position.
As mentioned earlier, the Company does not have a steady flow of income, with income generated irregularly in connection with the signing of license agreements and achievement of milestones. Therefore, the Company monitors performance indicators such as equity ratio and equity per share in order to assess the Company's solvency and financial stability. These are monitored along with the cash position and the various measures of cash flows shown in the consolidated statement of cash flow.
| All amounts TSEK unless specified | 2021 Apr-Jun |
2020 Apr-Jun |
2021 Jan–Jun |
2020 Jan–Jun |
2020 Jan–Dec |
|---|---|---|---|---|---|
| Profit/loss for the period | -34,959 | -35,052 | -67,700 | -77,932 | -143,296 |
| Average number of shares before dilution | 85,666,338 | 71,388,615 | 85,666,338 | 71,388,615 | 71,388,615 |
| Earnings per share before dilution, SEK | -0,41 | -0,49 | -0,79 | -1,09 | -2,01 |
| Average number of shares after dilution | 85,666,338 | 71,388,615 | 85,666,338 | 71,388,615 | 71,388,615 |
| Earnings per share after dilution, SEK | -0,41 | -0,49 | -0,79 | -1,09 | -2,01 |
| Operating costs | -38,399 | -40,310 | -71,724 | -85,192 | -150,964 |
| Operating costs excluding impairments | -38,399 | -40,310 | -71,724 | -85,192 | -150,964 |
| Administrative expenses | -7,311 | -8,063 | -15,832 | -17,552 | -29,191 |
| Depreciation | -3,277 | -2,900 | -5,607 | -5,765 | -11,522 |
| Research and development costs | -27,810 | -29,347 | -50,285 | -61,875 | -110,252 |
| R&D costs / Operating costs excluding impairments % | 72% | 73% | 70% | 73% | 73% |
| Equity | 122,275 | 180,581 | 122,275 | 180,581 | 115,244 |
| Average number of shares before dilution | 85,666,338 | 71,388,615 | 85,666,338 | 71,388,615 | 71,388,615 |
| Equity per share before dilution, SEK | 1,43 | 2,53 | 1,43 | 2,53 | 1,61 |
| Average number of shares after dilution | 85,666,338 | 71,388,615 | 85,666,338 | 71,388,615 | 71,388,615 |
| Equity per share after dilution, SEK | 1,43 | 2,53 | 1,43 | 2,53 | 1,61 |
| Equity | 122,275 | 180,581 | 122,275 | 180,581 | 115,244 |
| Total assets | 155,459 | 222,113 | 155,459 | 222,113 | 151,938 |
| Equity ratio, % | 79% | 81% | 79% | 81% | 76% |
| Cash and cash equivalents | 109,705 | 169,757 | 109,705 | 169,757 | 103,342 |
| Cash and cash equivalents at end of period | 109,705 | 169,757 | 109,705 | 169,757 | 103,342 |
For definitions, see the section "Financial definitions" on page 25.
Anders Ekblom Graham Dixon Hans-Peter Ostler
Eva Sjökvist Saers
The Board and the CEO declare that this Interim report provides a true and fair overview of the Company and the Group's operations, positions and earnings and describes the material risks and uncertainty factors faced by the Parent Company and the companies within the Group.
Lund, July 13, 2021
Anders Ekblom Hans-Peter Ostler Chairman Member of the Board
Veronica Wallin
Laura von Schantz
Søren Bregenholt
Eva Sjökvist Saers Graham Dixon Member of the Board Member of the Board
Veronica Wallin Laura von Schantz
Member of the Board Member of the Board
Søren Bregenholt CEO
Agonist. A compound which binds to a receptor and stimulates its activity.
Antigen. Substance which triggers a reaction in the immune system, such as a bacteria or virus.
Antibody. Proteins used by the body's immune defenses to detect and identify xenobiotic material.
Bispecific antibodies. Antibody-based products which bind to two different targets and thus have dual functions.
Cancer. A disease in which cells divide in an uncontrolled manner and invade neighboring tissue. Cancer can also spread (metastasize) to other parts of the body through the blood and the lymphatic system.
Checkpoint inhibitor. An antibody with the ability to break the immune system's tolerance to something dangerous, for example a cancer tumor. Immune-inhibiting signals can be blocked through binding to a specific receptor such as CTLA-4 or PD-1.
Clinical study. The examination of healthy volunteers or patients to study the safety and efficacy of a potential drug or treatment method.
CRO (Clinical Research Organization). Company specialized in performing contract research and clinical studies on behalf of other pharma or biotech companies.
CTA (Clinical Trial Authorization). Application to start clinical trials in humans which is submitted to a regulatory authority.
CTLA-4 (Cytotoxic T-lymphocyte-Associated protein-4). An immuneinhibiting molecule expressed in and on the surface of T cells, primarily regulatory T cells.
Dendritic cell. A type of cell which detects xenobiotic substances. A key role of dendritic cells is their ability to stimulate T cells in the immune system.
Discovery. This research phase usually encompasses the development and evaluation of treatment concepts, the evaluation of potential drug candidates, and early efficacy studies.
Drug candidate. A specific compound usually designated before or during the preclinical phase. The drug candidate is the compound that is then studied in humans in clinical studies.
EMA. The European Medicines Agency.
Experimental model. A model of a disease or other injury to resemble a similar condition in humans.
FDA. The US Food and Drug Administration.
GMP (Good Manufacturing Practice). Quality assurance methodology designed to ensure that products are manufactured in a standardized manner, such that quality requirements are satisfied.
Immuno-oncology. Field of oncology in which cancer is treated by activating the immune system.
INN (International Nonproprietary Name). Generic name on a drug substance. The INN is selected by the World Health Organization (WHO) since 1953.
Lead. A potential drug candidate which binds to the actual target molecule/s.
Ligand. Binds to a receptor. Could be a drug, hormone or a transmitter substance.
Lymphocyte. A type of white blood cells.
Macrophages. A type of white blood cell of the immune system that engulfs and digests cellular debris and foreign materia such as bacteria.
Milestone payment. Financial consideration received in the course of a project/program when a specified objective is reached.
Mitazalimab. Generic name (INN) for ADC-1013.
Monospecific antibodies. Antibody-based product which bind only to one target, such as a receptor.
NK cells. NK cells (Natural Killer) are lymphocytes with the ability to activate several different cells in the immune system, such as macrophages.
Oncology. Term for the field of medicine concerned with the diagnosis, prevention and treatment of tumor diseases.
Patent. Exclusive rights to a discovery or invention.
PD-1 (Programmed Death-1). Immune-inhibiting receptor on the surface of certain cells, for example tumor cells.
PD-L1 (Programmed Death-Ligand-1). The ligand that binds to PD-1, helping the cancer evade the body's immune defense.
Phase I, II and III. The various stages of studies on the efficacy of a pharmaceutical in humans. See also "clinical study." Phase I examines the safety on healthy human subjects, Phase II examines efficacy in patients with the relevant disease and Phase III is a large-scale study that verifies previously
achieved results. In the development of new pharmaceuticals, different doses are trialed and safety is evaluated in patients with relevant disease. Phase II is often divided into Phase IIa and Phase IIb. In Phase IIa, which is open, different doses of the pharmaceutical are tested without comparison against placebo and focusing on safety and the pharmaceutical's metabolism in the body. Phase IIb is 'blind', and tests the efficacy of selected dose(es) against placebo.
Pharmacokinetics. The study of the turnover of substances in the body, for example how the amount of the substance is changed by absorption, distribution, metabolism and excretion.
Pharmacology. The study of how substances interact with living organisms to bring about a functional change.
Preclinical. The stage of drug development before the drug candidate is tested in humans. It includes the final optimization of the drug candidate, the production of materials for future clinical studies and the compilation of a data package for an application to start clinical studies.
Proof of concept studies. Studies carried out to provide support for dosages and administration paths in subsequent clinical studies.
R&D. Research & Development
Receptor. A receptor on a cell which picks up chemical signals.
Sponsor. The person, company, institution or organization responsible for initiating, organizing or financing a clinical study.
T cell. A type of white blood cell which is important to the specific immune defense.
Tumor-associated antigen (TAA). A protein expressed to a much higher degree on the surface of tumor cells than healthy cells.
Tumor cell. A cell that divides relentlessly.
Tumor necrotic factor receptor superfamily (TNFR-SF). A group of immune-modulating target proteins related to the tumor necrosis factor protein. The name 'tumor necrosis factor' was derived from the fact that the first function detected for the protein was its ability to kill some types of tumor cells, though it was later discovered to have an immune-regulatory function.
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