Clovis Oncology Inc. (Nasdaq: CLVS) must raise capital to remain a going concern, the company said in its second quarter report issued Monday, but that’s a prospect easier said than done as losses continue for the cancer-therapy developer.
Revenues generated by sales of Clovis’ main drug Rubraca were $32.1 million, down 13% from the same period in 2021.
The company cut research and development spending by 20% year over year and used 40% less cash for operating activities than in the first quarter of 2022.
Still, Clovis’ net loss in the second quarter of 2022 was $71.3 million, or 50 cents per share, compared to a net loss of $66.4 million, or 61 cents per share during the same period last year.
Rubraca is primarily prescribed to ovarian-cancer patients and survivors to lower the chance of relapse, but is thought to help control solid-tumor forms of cancer linked to a specific mutation in a person’s genetics.
The company also has FAP-2286, a drug candidate that inhibits fibroblast activation protein, an enzyme that’s highly active in about 90% of human cancers, in its development pipeline.
“We achieved a key milestone in the second quarter, with the presentations of the first clinical data from the LuMIERE trial of FAP-2286 and from the ongoing imaging-only investigator-initiated study. In addition to seeing the first evidence of safety and clinical activity, these initial results further demonstrate that fibroblast activation protein, or FAP, is a promising theranostic target with expression across many types of solid tumors,” Clovis CEO Patrick Mahaffy, said in a statement. “Turning to Rubraca, following the positive results from ATHENA-MONO, we believe Rubraca represents an important new option as a front-line maintenance treatment of ovarian cancer, and we are on track for submissions to the (U.S. Food and Drug Administration) and (European Medicines Agency) during the third quarter of 2022.”
For the past several quarters, Clovis has blamed slipping revenue totals on the COVID-19 pandemic.
With doctors and patients overwhelmed with COVID-19, cancer diagnoses and treatments fell by the wayside, the company claims.
“The reduction in ovarian cancer diagnoses and fewer patient starts in the U.S. in previous quarters as a result of COVID has continued to impact second-line maintenance treatment,” Clovis’ quarterly report said. “While it does appear that ovarian cancer diagnoses are reverting to pre-COVID levels, the effect of this increase is almost wholly observed on front-line treatments and will not likely impact the second-line indications for several quarters.”
Clovis had $94.6 million in cash and cash equivalents as of June 30, but “will need to raise additional capital in the near term in order to fund its operating plan and to continue as a going concern beyond February of 2023,” Clovis said.
The company attempted a reverse stock split this year, but shareholders didn’t approve the move.
“Clovis is actively exploring sources of funding other than equity financing transactions, including through entering into strategic partnerships or licensing arrangements for one or more of our products or product candidates,” the company said. “Clovis is currently in preliminary discussions related to partnering certain development and commercialization rights to FAP-2286, for which the company seeks consideration such as an upfront payment and additional payments in the form of milestones, research and development support and royalties.”
Clovis acknowledges that “it would need to successfully complete some combination of the strategic initiatives and equity financing” in order to remain a going concern.
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