8-K: Athira Pharma Reports Q1 2024 Financial Results and Provides Pipeline Update

Athira Pharma announced its first quarter 2024 financial results and provided updates on its clinical pipeline, including the anticipated topline data from the LIFT-AD trial in the second half of 2024.

Summary

• Athira Pharma reported its financial results for the first quarter of 2024, ending March 31, 2024.
• The company is anticipating topline data from the Phase 2/3 LIFT-AD clinical trial of fosgonimeton for Alzheimer's disease in the second half of 2024.
• An Investigational New Drug application was submitted to the FDA for ATH-1105 for the treatment of amyotrophic lateral sclerosis (ALS).
• Athira expects to begin a first-in-human study of ATH-1105 in the second quarter of 2024.
• The company's cash, cash equivalents, and investments totaled $122.1 million as of March 31, 2024, compared to $147.4 million at the end of 2023.
• Net cash used in operations was $25.8 million for the quarter, slightly less than the $26.2 million used in the same period last year.
• Research and development expenses were $21.2 million for the quarter, similar to the $21.3 million in the same quarter of 2023.
• General and administrative expenses decreased to $6.5 million from $8.5 million in the same quarter of 2023.
• The net loss for the quarter was $26.3 million, or $0.69 per share, compared to a net loss of $27.8 million, or $0.73 per share, for the same period in 2023.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive due to the progress in the clinical pipeline, the upcoming LIFT-AD data readout, and the appointment of a new Chief Medical Officer. However, the decrease in cash position and the net loss temper the overall sentiment.

Positives

• The company has a strong balance sheet to support its pipeline through key clinical milestones.
• The open-label extension trial has seen high enrollment, with over 85% of eligible participants continuing treatment.
• The company is progressing its pipeline with the submission of the IND for ATH-1105 and the expected initiation of a first-in-human study.
• Net loss per share improved slightly year-over-year, from $0.73 to $0.69.
• General and administrative expenses decreased from $8.5 million to $6.5 million year-over-year.

Negatives

• The company's cash position decreased from $147.4 million at the end of 2023 to $122.1 million as of March 31, 2024.
• The company experienced a net loss of $26.3 million for the quarter.
• Research and development expenses remained relatively flat year-over-year at $21.2 million.

Risks

• The success of the LIFT-AD trial is critical, and the topline data expected in the second half of 2024 will be a key inflection point.
• Clinical trials may not support the safety, efficacy, and tolerability of Athira's drug candidates.
• Regulatory authorities could object to protocols, amendments, and other submissions.
• The company may not be able to recruit sufficient patients for its clinical trials.
• There are risks associated with the outcome of legal proceedings that have been or may be instituted against Athira.
• Adverse conditions in the general domestic and global economic markets could impact the company.

Future Outlook

The company anticipates topline data from the LIFT-AD trial in the second half of 2024 and expects to initiate a first-in-human study of ATH-1105 in the second quarter of 2024. The company believes its drug candidates have the potential to treat a broad range of neurodegenerative diseases.

Management Comments

• We are on the cusp of a potentially transformative milestone as we are fast approaching the expected topline data readout from our Phase 2/3 LIFT-AD clinical trial of fosgonimeton in Alzheimers disease (AD) in the second half of this year, said Mark Litton, Ph.D., President and Chief Executive Officer of Athira.
• The totality of clinical and nonclinical data to date support our confidence in the LIFT-AD trial and underscore the potential of our differentiated approach in targeting the neurotrophic HGF system to induce neuroprotective effects across a number of neurodegenerative diseases.
• We were delighted to welcome Javier San Martin, M.D. as our new Chief Medical Officer. His insight and expertise will be invaluable as we move toward the LIFT-AD data readout and the potential opportunity to deliver fosgonimeton as a new treatment option for AD patients in need of better therapies.
• In parallel, we continue to progress ATH-1105 in amyotrophic lateral sclerosis (ALS) and expect to initiate a first-in-human study of this oral small molecule drug candidate in the coming months, added Dr. Litton.

Industry Context

Athira's focus on neurodegenerative diseases aligns with a growing need for effective treatments in this area. The company's approach of targeting the HGF system is a differentiated strategy compared to other companies in the space. The progress of the LIFT-AD trial and the development of ATH-1105 are key milestones in the competitive landscape of neurodegenerative drug development.

Comparison to Industry Standards

• Athira's approach of targeting the HGF system is unique compared to companies like Biogen and Eli Lilly, which focus on amyloid-beta and tau pathways in Alzheimer's disease.
• The high enrollment rate in the OLEX trial suggests a strong patient interest in fosgonimeton, which is a positive sign compared to other trials with lower retention rates.
• The company's cash position of $122.1 million is relatively modest compared to larger pharmaceutical companies, but it is sufficient to support its current clinical programs.
• The net loss of $26.3 million is typical for a clinical-stage biotech company, and the slight improvement year-over-year is a positive indicator.
• The company's R&D expenses are in line with other companies at a similar stage of development.

Management Changes

Stakeholder Impact

• Shareholders will be closely watching the topline data from the LIFT-AD trial, which could significantly impact the company's valuation.
• Employees are likely to be impacted by the progress of the clinical trials and the company's financial performance.
• Patients with neurodegenerative diseases are a key stakeholder group, as Athira's drug candidates have the potential to provide new treatment options.
• The company's financial performance and clinical progress will impact its relationships with suppliers and creditors.

Next Steps

• Athira expects to report topline data from the LIFT-AD trial in the second half of 2024.
• The company plans to initiate a first-in-human study of ATH-1105 in the second quarter of 2024.
• Athira will continue to advance its pipeline of drug candidates targeting the neurotrophic HGF system.

Key Dates

Keywords

Athira Pharma, Alzheimer's disease, Fosgonimeton, ATH-1105, Amyotrophic lateral sclerosis, Clinical trial, Neurodegenerative diseases, HGF system, LIFT-AD, Pipeline, Biopharmaceutical, Neurotrophic