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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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DELAWARE
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26-2025616
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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245 First Street, Suite 1800
Cambridge, MA
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02142
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(Address of principal executive offices)
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(Zip code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, $0.001 par value
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SESN
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The Nasdaq Stock Market
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Page
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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||
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Item 1.
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Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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•
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our expected future loss and accumulated deficit levels;
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•
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our projected financial position and estimated cash burn rate;
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•
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our estimates regarding expenses, future revenues, capital requirements and needs for, and ability to obtain, additional financing;
|
•
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our ability to continue as a going concern;
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•
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our need to raise substantial additional capital to fund our operations;
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•
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the potential impairment of our goodwill and our indefinite-lived intangible assets;
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•
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the effect of recent changes in our senior management team on our business;
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•
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the success, cost and timing of our pre-clinical studies and clinical trials in the United States, Canada and in other foreign jurisdictions;
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•
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the potential that results of pre-clinical studies and clinical trials indicate our product candidates are unsafe or ineffective;
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•
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our dependence on third parties, including contract research organizations, or CROs, in the conduct of our pre-clinical studies and clinical trials;
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•
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the difficulties and expenses associated with obtaining and maintaining regulatory approval of our product candidates and companion diagnostics, if any, in the United States, Canada and in other foreign jurisdictions, and the labeling under any approval we may obtain;
|
•
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our plans and ability to develop and commercialize our product candidates;
|
•
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our ability to achieve certain future regulatory, development and commercialization milestones under our license agreement, which we refer to as the License Agreement, with F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc., or collectively, Roche;
|
•
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the timing and costs associated with our manufacturing process and technology transfer to FUJIFILM Diosynth Biotechnologies U.S.A., Inc., or Fujifilm, and our reliance on Fujifilm to perform under our agreement;
|
•
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market acceptance of our product candidates, the size and growth of the potential markets for our product candidates, and our ability to serve those markets;
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•
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obtaining and maintaining intellectual property protection for our product candidates and our proprietary technology;
|
•
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the successful development of our commercialization capabilities, including sales and marketing capabilities; and
|
•
|
the success of competing therapies and products that are or become available.
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|
March 31,
2019 |
|
December 31, 2018
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
42,437
|
|
|
$
|
50,422
|
|
Prepaid expenses and other current assets
|
3,014
|
|
|
1,334
|
|
||
Total current assets
|
45,451
|
|
|
51,756
|
|
||
Property and equipment, net
|
272
|
|
|
321
|
|
||
Restricted cash
|
20
|
|
|
20
|
|
||
Intangible assets
|
46,400
|
|
|
46,400
|
|
||
Goodwill
|
13,064
|
|
|
13,064
|
|
||
Other assets
|
232
|
|
|
—
|
|
||
Total assets
|
$
|
105,439
|
|
|
$
|
111,561
|
|
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
1,683
|
|
|
$
|
1,367
|
|
Accrued expenses
|
5,234
|
|
|
4,746
|
|
||
Other current liabilities
|
136
|
|
|
—
|
|
||
Total current liabilities
|
7,053
|
|
|
6,113
|
|
||
Other liabilities
|
398
|
|
|
313
|
|
||
Deferred tax liability
|
12,528
|
|
|
12,528
|
|
||
Contingent consideration
|
47,400
|
|
|
48,400
|
|
||
Commitments and contingencies
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $0.001 par value per share; 5,000,000 shares authorized at March 31, 2019 and December 31, 2018 and no shares issued and outstanding at March 31, 2019 and December 31, 2018
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value per share; 200,000,000 shares authorized at March 31, 2019 and December 31, 2018 and 77,464,781 and 77,456,180 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively
|
77
|
|
|
77
|
|
||
Additional paid-in capital
|
230,487
|
|
|
230,154
|
|
||
Accumulated deficit
|
(192,504
|
)
|
|
(186,024
|
)
|
||
Total stockholders’ equity
|
38,060
|
|
|
44,207
|
|
||
Total liabilities and stockholders’ equity
|
$
|
105,439
|
|
|
$
|
111,561
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Operating expenses:
|
|
|
|
||||
Research and development
|
4,686
|
|
|
3,255
|
|
||
General and administrative
|
3,055
|
|
|
1,952
|
|
||
Gain from change in fair value of contingent consideration
|
(1,000
|
)
|
|
(1,200
|
)
|
||
Total operating expenses
|
6,741
|
|
|
4,007
|
|
||
Loss from operations
|
(6,741
|
)
|
|
(4,007
|
)
|
||
Other income:
|
|
|
|
||||
Other income, net
|
261
|
|
|
44
|
|
||
Total other income, net
|
261
|
|
|
44
|
|
||
Net loss and comprehensive loss
|
$
|
(6,480
|
)
|
|
$
|
(3,963
|
)
|
Net loss per share — basic and diluted
|
$
|
(0.08
|
)
|
|
$
|
(0.11
|
)
|
Weighted-average number of common shares used in net loss per share — basic and diluted
|
77,458
|
|
|
35,674
|
|
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Deficit
|
|
Stockholders’
Equity
|
|||||||||||
|
Shares
|
|
Amount
|
|
||||||||||||||
|
(in thousands, except share data)
|
|||||||||||||||||
Balance at December 31, 2018
|
77,456,180
|
|
|
77
|
|
|
230,154
|
|
|
(186,024
|
)
|
|
44,207
|
|
||||
Issuance of common stock pursuant to the 2014 ESPP
|
8,601
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
326
|
|
|
|
|
326
|
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,480
|
)
|
|
(6,480
|
)
|
||||
Balance at March 31, 2019
|
77,464,781
|
|
|
$
|
77
|
|
|
$
|
230,487
|
|
|
$
|
(192,504
|
)
|
|
$
|
38,060
|
|
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Deficit
|
|
Stockholders’
Equity
|
|||||||||||
|
Shares
|
|
Amount
|
|
||||||||||||||
|
(in thousands, except share data)
|
|||||||||||||||||
Balance at December 31, 2017
|
34,702,565
|
|
|
35
|
|
|
170,330
|
|
|
(152,331
|
)
|
|
18,034
|
|
||||
Exercise of stock options and vesting of restricted stock awards
|
4,430
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Issuance of common stock pursuant to the 2014 ESPP
|
9,565
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
10
|
|
||||
Exercise of common stock warrants
|
420,778
|
|
|
—
|
|
|
336
|
|
|
—
|
|
|
336
|
|
||||
Issuance of common stock and common stock warrants, net of issuance costs
|
7,968,128
|
|
|
8
|
|
|
9,032
|
|
|
—
|
|
|
9,040
|
|
||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
401
|
|
|
|
|
401
|
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,963
|
)
|
|
(3,963
|
)
|
||||
Balance at March 31, 2018
|
43,105,466
|
|
|
$
|
43
|
|
|
$
|
180,109
|
|
|
$
|
(156,294
|
)
|
|
$
|
23,858
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Operating activities
|
|
|
|
||||
Net loss
|
$
|
(6,480
|
)
|
|
$
|
(3,963
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation
|
49
|
|
|
49
|
|
||
Stock-based compensation expense
|
326
|
|
|
401
|
|
||
Change in fair value of warrant liability
|
—
|
|
|
—
|
|
||
Gain from change in fair value of contingent consideration
|
(1,000
|
)
|
|
(1,200
|
)
|
||
Gain on sale of equipment
|
—
|
|
|
(5
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Prepaid expenses and other assets
|
(1,912
|
)
|
|
(236
|
)
|
||
Accounts payable
|
316
|
|
|
486
|
|
||
Accrued expenses and other liabilities
|
709
|
|
|
85
|
|
||
Net cash used in operating activities
|
(7,992
|
)
|
|
(4,383
|
)
|
||
Investing activities
|
|
|
|
||||
Sales of equipment
|
—
|
|
|
5
|
|
||
Net cash provided by investing activities
|
—
|
|
|
5
|
|
||
Financing activities
|
|
|
|
||||
Proceeds from issuance of common stock and the issuance and exercise of common stock warrants, net of issuance costs
|
—
|
|
|
9,376
|
|
||
Proceeds from sale of common stock pursuant to 2014 ESPP
|
7
|
|
|
10
|
|
||
Net cash provided by financing activities
|
7
|
|
|
9,386
|
|
||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(7,985
|
)
|
|
5,008
|
|
||
Cash, cash equivalents and restricted cash at beginning of period
|
50,442
|
|
|
14,690
|
|
||
Cash, cash equivalents and restricted cash at end of period
|
$
|
42,457
|
|
|
$
|
19,698
|
|
Supplemental non-cash operating activities
|
|
|
|
||||
Right-of-use assets obtained in exchange for new operating lease
|
$
|
236,480
|
|
|
—
|
|
|
Cash paid for amounts included in the measurement of liabilities
|
$
|
38,202
|
|
|
—
|
|
•
|
Accounting policy election to use the short-term lease exception by asset class;
|
•
|
Election of the practical expedient package during transition, which includes:
|
◦
|
An entity need not reassess whether any expired or existing contracts are or contain leases.
|
◦
|
An entity need not reassess the classification for any expired or existing leases. As a result, all leases that were classified as operating leases in accordance with ASC 840 are classified as operating leases under ASC 842, and all leases that were classified as capital leases in accordance with ASC 840 are classified as finance leases under ASC 842.
|
◦
|
An entity need not reassess initial direct costs for any existing leases.
|
◦
|
An entity need not separate out non-lease components from lease components, for all classes of underlying assets
|
Description
|
March 31,
2019 |
|
Active
Markets
(Level 1)
|
|
Observable
Inputs
(Level 2)
|
|
Unobservable
Inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
42,437
|
|
|
$
|
42,437
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash
|
20
|
|
|
20
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
42,457
|
|
|
$
|
42,457
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration
|
47,400
|
|
|
—
|
|
|
—
|
|
|
47,400
|
|
||||
Total liabilities
|
$
|
47,400
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
47,400
|
|
Description
|
December 31, 2018
|
|
Active
Markets
(Level 1)
|
|
Observable
Inputs
(Level 2)
|
|
Unobservable
Inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
50,422
|
|
|
$
|
50,422
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted cash
|
20
|
|
|
20
|
|
|
—
|
|
|
—
|
|
||||
Total assets
|
$
|
50,442
|
|
|
$
|
50,442
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration
|
48,400
|
|
|
—
|
|
|
—
|
|
|
48,400
|
|
||||
Total liabilities
|
$
|
48,400
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48,400
|
|
Beginning balance, December 31, 2018
|
$
|
48,400
|
|
Gain from change in fair value of contingent consideration
|
(1,000
|
)
|
|
Ending balance, March 31, 2019
|
$
|
47,400
|
|
|
March 31,
2019 |
|
December 31, 2018
|
||||
Development costs
|
$
|
3,542
|
|
|
$
|
2,928
|
|
Employee compensation
|
491
|
|
|
1,045
|
|
||
Severance to former CEO and other employees
|
610
|
|
|
278
|
|
||
Professional fees
|
519
|
|
|
464
|
|
||
Other
|
72
|
|
|
31
|
|
||
|
$
|
5,234
|
|
|
$
|
4,746
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Stock options
|
$
|
325
|
|
|
$
|
375
|
|
Restricted stock
|
—
|
|
|
23
|
|
||
Employee stock purchase plan
|
1
|
|
|
3
|
|
||
|
$
|
326
|
|
|
$
|
401
|
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
Research and development expense
|
$
|
52
|
|
|
$
|
165
|
|
General and administrative expense
|
274
|
|
|
236
|
|
||
|
$
|
326
|
|
|
$
|
401
|
|
|
Shares
|
|
Weighted-Average
Exercise Price
|
|||
Outstanding at December 31, 2018
|
3,941,947
|
|
|
$
|
2.12
|
|
Granted
|
2,110,115
|
|
|
0.85
|
|
|
Exercised
|
—
|
|
|
—
|
|
|
Cancelled or forfeited
|
(363,500
|
)
|
|
2.44
|
|
|
Outstanding at March 31, 2019
|
5,688,562
|
|
|
$
|
1.62
|
|
Exercisable at March 31, 2019
|
1,076,840
|
|
|
$
|
3.13
|
|
|
Three Months Ended March 31,
|
||||
|
2019
|
|
2018
|
||
Stock options
|
5,688,562
|
|
|
2,648,004
|
|
Unvested restricted stock
|
—
|
|
|
—
|
|
Common stock warrants
|
9,257,632
|
|
|
17,602,350
|
|
|
14,946,194
|
|
|
20,250,354
|
|
|
||||||
|
March 31,
|
|
December 31,
|
|||
|
2019
|
|
2018
|
|||
Cash and cash equivalents
|
42,437
|
|
|
$
|
50,422
|
|
Restricted cash
|
20
|
|
|
20
|
|
|
Total cash, cash equivalents and restricted cash
|
42,457
|
|
|
50,442
|
|
|
Three months ended March 31, 2019
|
|
Lease Cost:
|
|
|
Operating lease cost (including related operating costs)
|
75
|
|
Short-term lease cost
|
76
|
|
Total lease cost
|
151
|
|
Supplemental Information:
|
Three months ended March 31, 2019
|
|
Weighted-average remaining lease term - operating leases (in years)
|
1.5
|
|
Weighted-average discount rate - operating leases
|
12
|
%
|
|
Operating lease payments
|
|
2019 (1)
|
116
|
|
2020
|
116
|
|
2021
|
—
|
|
Total future minimum lease payments
|
232
|
|
Less: amounts representing present value adjustment
|
21
|
|
Operating lease liabilities as of March 31, 2019
|
211
|
|
Less: current portion of operating lease liabilities
|
136
|
|
Operating lease liabilities, net of current portion
|
75
|
|
•
|
Cohort 1 (n=86): Patients with carcinoma
in situ
, or CIS,
with or without papillary disease that was determined to be refractory or recurred within six months of their last course of adequate BCG
|
•
|
Cohort 2 (n=7): Patients with CIS or without papillary disease that was determined to be refractory or recurred after six months, but less than 11 months, after their last course of adequate BCG
|
•
|
Cohort 3 (n=40): Patients with high-risk papillary disease without CIS that was determined to be refractory or recurred within six months of their last course of adequate BCG
|
Dose
|
|
30 mg of Vicinium (in 50 mL of saline)
|
|
Estimated total enrollment
|
|
Approximately 134 patients, including 77 CIS patients whose disease is refractory to or relapsed within 6 months of the last dose of adequate BCG treatment
|
|
Primary endpoint
|
|
•
|
Complete response rate in patients with CIS (with or without papillary disease) whose disease is refractory or relapsed in six months or less following adequate BCG treatment, which is defined as at least two courses of full dose BCG; and
|
|
|
•
|
Duration of response will be estimated (Kaplan-Meier Estimate) for those patients with CIS whose disease is refractory to or relapsed within 6 months of the last dose of adequate BCG treatment (with or without papillary disease) who experience a complete response.
|
Secondary endpoints
|
|
•
|
Complete response rate and duration of response in patients with CIS whose disease is refractory to or relapsed within 6 months of the last dose of adequate BCG treatment (with or without papillary disease) whose disease is refractory or relapsed from six months to 11 months following adequate BCG treatment;
|
|
|
•
|
Complete response rate and duration of response in all patients with CIS (with or without papillary disease) following adequate BCG treatment;
|
|
|
•
|
Event-free survival, or EFS, in all patients;
|
|
|
•
|
Complete response rate in patients at three, six, nine, 12, 15, 18, 21, and 24 months in patients with CIS whose disease is refractory to or relapsed within 6 months of the last dose of adequate BCG treatment;
|
|
|
•
|
Time to cystectomy in all patients;
|
|
|
•
|
Time to disease recurrence in all patients;
|
|
|
•
|
Progression-free survival, or PFS, in all patients;
|
|
|
•
|
Overall survival, or OS, in all patients; and
|
|
|
•
|
Safety and tolerability of Vicinium therapy in all patients.
|
|
|
|
|
Exploratory endpoint
|
|
To evaluate biomarkers that may be associated with response or disease progression or treatment failure, which may include, for example, EpCAM status, tumor subtype morphology, furin levels in tumor cell endosomes, presence of a glycosaminoglycan coat, and presence of receptors that could impede a host anti-tumor immune response such as PD-L1.
|
Time point
|
Evaluable Patients
|
Complete Response Rate
|
3-months
|
n=86
|
37%
|
6-months
|
n=86
|
26%
|
9-months
|
n=85
|
19%
|
12-months
|
n=84
|
15%
|
Time point
|
Evaluable Patients
|
Complete Response Rate
|
3-months
|
n=7
|
57%
|
6-months
|
n=7
|
57%
|
9-months
|
n=7
|
43%
|
12-months
|
n=7
|
14%
|
Time point
|
Evaluable Patients
|
Complete Response Rate
(95% Confidence Interval)
|
3-months
|
n=93
|
39% (29%- 49%)
|
6-months
|
n=93
|
28% (19%-38%)
|
9-months
|
n=92
|
21% (13%-30%)
|
12-months
|
n=91
|
15% (9%-24%)
|
•
|
Duration of Response:
The median duration of response for patients in Cohort 1 (n=86) is 287 days (95% confidence interval, or CI, 127-NA), using the Kaplan-Meier method. The Kaplan-Meier method is a
non-parametric statistical analysis used to estimate survival times and times to event when incomplete observations in data exist
. Additional ad hoc analysis of pooled data for all patients with CIS (Cohorts 1 and 2, n=93) shows that among patients who achieved a complete response at 3 months, 54% had a complete response for a total of 12 months or longer after starting therapy, using the Kaplan-Meier method.
|
•
|
Time to Disease Recurrence:
High-grade papillary (Ta or T1) NMIBC is associated with higher rates of progression and recurrence. Therefore, time to disease recurrence is a key secondary endpoint for patients with high-risk papillary-only NMIBC. The median time to disease recurrence for patients in Cohort 3 (n=40) is 436 days (95% CI, 224-648), using the Kaplan-Meier method.
|
•
|
Time to Cystectomy:
The first FDA guidance on treatment of BCG-unresponsive NMIBC patients states that the goal of therapy in such patients is to avoid cystectomy. Therefore, time to cystectomy is a key secondary endpoint in the VISTA Trial. Across all 133 patients treated with Vicinium in the VISTA Trial, greater than 75% of all patients are estimated to remain cystectomy-free at 2.5 years, using the Kaplan-Meier method. Additional ad hoc analysis of responders and non-responders for all patients shows that responders are approximately 15 times more likely to remain cystectomy-free at 2.5 years compared to non-responders.
|
•
|
Progression-Free Survival:
Greater than
85% of all 133 patients treated with Vicinium in the VISTA Trial are estimated to remain progression-free at 2 years, using the Kaplan-Meier method. Progression-free is defined as the time from the date of first dose of study treatment to disease progression (e.g. T2 or more advanced disease) or death as a first event.
|
•
|
Event-Free Survival:
Approximately 30% of all 133 patients treated with Vicinium in the VISTA Trial are estimated to remain event-free at 12 months, using the Kaplan-Meier method. Event-free survival is defined as the time from the date of first dose of study treatment to disease recurrence, progression, or death as a first event.
|
•
|
Overall Survival:
Approximately 90% of all 133 patients treated with Vicinium in the VISTA Trial have an overall survival of greater than 2.5 years, using the Kaplan-Meier method. Overall survival is defined as the time from the date of first dose of study treatment to death from any cause.
|
•
|
the scope, initiation, progress, timing, costs and results of pre-clinical development and laboratory testing and clinical trials for our product candidates;
|
•
|
the cost and timing of any new clinical trials or studies of our product candidates;
|
•
|
our ability to establish collaborations on favorable terms, if at all, particularly manufacturing, marketing and distribution arrangements for our product candidates;
|
•
|
the costs and timing of the implementation of commercial-scale manufacturing activities, including those associated with the manufacturing process and technology transfer to third-party manufacturers to facilitate such commercial-scale manufacturing;
|
•
|
the costs and timing of establishing sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval;
|
•
|
the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims;
|
•
|
our obligation to make milestone, royalty and other payments to third party licensors under our licensing agreements;
|
•
|
the extent to which we in-license or acquire rights to other products, product candidates or technologies;
|
•
|
the outcome, timing and cost of regulatory review by the FDA and comparable foreign regulatory authorities, including the potential for the FDA or comparable foreign regulatory authorities, including Health Canada, to require that we perform more studies or clinical trials than those that we currently expect;
|
•
|
our ability to achieve certain future regulatory, development and commercialization milestones under the License Agreement with Roche;
|
•
|
the effect of competing technological and market developments; and
|
•
|
the revenue, if any, received from commercial sales of any product candidates for which we receive regulatory approval.
|
•
|
employee-related expenses, including salaries, benefits, travel and stock-based compensation expense;
|
•
|
expenses incurred under agreements with contract research organizations, or CROs, and investigative sites that conduct our clinical trials;
|
•
|
expenses associated with developing manufacturing capabilities and manufacturing clinical study materials;
|
•
|
facilities, depreciation, and other expenses, which include direct and allocated expenses for rent and maintenance of facilities, insurance, and other supplies; and
|
•
|
expenses associated with pre-clinical and regulatory activities.
|
•
|
the scope, progress, outcome and costs of our clinical trials and other research and development activities;
|
•
|
the efficacy and potential advantages of our product candidates compared to alternative treatments, including any standard of care;
|
•
|
the market acceptance of our product candidates;
|
•
|
the cost and timing of the implementation of commercial-scale manufacturing of our product candidates;
|
•
|
obtaining, maintaining, defending and enforcing patent claims and other intellectual property rights;
|
•
|
significant and changing government regulation; and
|
•
|
the timing, receipt and terms of any marketing approvals.
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Programs:
|
|
|
|
||||
Vicinium, for the treatment of high-risk NMIBC
|
$
|
2,362
|
|
|
$
|
1,922
|
|
Total direct program expenses
|
2,362
|
|
|
1,922
|
|
||
Personnel and other expenses:
|
|
|
|
||||
Employee and contractor-related expenses
|
1,710
|
|
|
965
|
|
||
Platform-related lab expenses
|
281
|
|
|
63
|
|
||
Facility expenses
|
110
|
|
|
95
|
|
||
Other expenses
|
223
|
|
|
210
|
|
||
Total personnel and other expenses
|
2,324
|
|
|
1,333
|
|
||
Total research and development expenses
|
$
|
4,686
|
|
|
$
|
3,255
|
|
|
Three Months Ended
March 31, |
|
|
||||||||
|
2019
|
|
2018
|
|
Change
|
||||||
|
(in thousands)
|
||||||||||
Operating expenses:
|
|
|
|
|
|
||||||
Research and development
|
4,686
|
|
|
3,255
|
|
|
1,431
|
|
|||
General and administrative
|
3,055
|
|
|
1,952
|
|
|
1,103
|
|
|||
Gain from change in fair value of contingent consideration
|
(1,000
|
)
|
|
(1,200
|
)
|
|
200
|
|
|||
Total operating expenses
|
6,741
|
|
|
4,007
|
|
|
2,734
|
|
|||
Loss from operations
|
(6,741
|
)
|
|
(4,007
|
)
|
|
(2,734
|
)
|
|||
Other income, net
|
261
|
|
|
44
|
|
|
217
|
|
|||
Net loss and comprehensive loss
|
$
|
(6,480
|
)
|
|
$
|
(3,963
|
)
|
|
$
|
(2,517
|
)
|
|
Three Months Ended
March 31, |
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Net cash (used in) provided by :
|
|
|
|
||||
Operating activities
|
$
|
(7,992
|
)
|
|
$
|
(4,383
|
)
|
Investing activities
|
—
|
|
|
5
|
|
||
Financing activities
|
7
|
|
|
9,386
|
|
||
Net decrease in cash and cash equivalents
|
$
|
(7,985
|
)
|
|
$
|
5,008
|
|
•
|
continue our Phase 3 clinical trial for Vicinium for the treatment of high-risk NMIBC;
|
•
|
incur research and pre-clinical and clinical development of our other product candidates;
|
•
|
seek to discover and develop additional product candidates;
|
•
|
in-license or acquire the rights to other products, product candidates or technologies;
|
•
|
seek marketing approvals for any product candidates that successfully complete clinical trials;
|
•
|
establish sales, marketing and distribution capabilities and scale up and validate external manufacturing capabilities (including initiating and completing the manufacturing process and technology transfer to any third-party manufacturers) to commercialize any products for which we may obtain marketing approval;
|
•
|
maintain, expand and protect our intellectual property portfolio;
|
•
|
add equipment and physical infrastructure to support our research and development;
|
•
|
hire additional clinical, regulatory, quality control, scientific and management personnel; and
|
•
|
expand our operational, financial and management systems and personnel.
|
•
|
the scope, initiation, progress, timing, costs and results of pre-clinical development and laboratory testing of our pre-clinical product candidates;
|
•
|
the cost and timing of any new clinical trials or studies of our product candidates;
|
•
|
our ability to establish collaborations on favorable terms, if at all, particularly manufacturing, marketing and distribution arrangements for our product candidates;
|
•
|
the costs and timing of the implementation of commercial-scale manufacturing activities;
|
•
|
the costs and timing of establishing sales, marketing and distribution capabilities for any product candidates for which we may receive regulatory approval;
|
•
|
the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual property rights and defending any intellectual property-related claims;
|
•
|
our obligation to make milestone, royalty and other payments to third party licensors under our licensing agreements;
|
•
|
the extent to which we in-license or acquire rights to other products, product candidates or technologies;
|
•
|
the outcome, timing and cost of regulatory review by the FDA and comparable foreign regulatory authorities, including the potential for the FDA or comparable foreign regulatory authorities, including Health Canada, to require that we perform more studies than those that we currently expect;
|
•
|
our ability to achieve certain future regulatory, development and commercialization milestones under the License Agreement with Roche;
|
•
|
the effect of competing technological and market developments; and
|
•
|
the revenue, if any, received from commercial sales of any product candidates for which we receive regulatory approval.
|
|
Total
|
|
Less than 1 Year
|
|
1 to 3 Years
|
|
3 to 5 Years
|
|
More than 5 Years
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Operating lease obligations (1)
|
$
|
232
|
|
|
$
|
155
|
|
|
$
|
77
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short term lease obligations (2)
|
90
|
|
|
90
|
|
|
|
|
|
|
|
||||||||
License maintenance fees (3)
|
1,004
|
|
|
182
|
|
|
547
|
|
|
275
|
|
|
—
|
|
|||||
Total fixed contractual obligations
|
$
|
1,326
|
|
|
$
|
427
|
|
|
$
|
624
|
|
|
$
|
275
|
|
|
$
|
—
|
|
Item 1A.
|
Risk Factors
|
Exhibit
No.
|
|
Description
|
3.1
|
|
|
3.2
|
|
|
3.3
|
|
|
3.4
|
|
|
4.1
|
|
|
4.2
|
|
|
4.3
|
|
|
4.4
|
|
|
4.5
|
|
|
4.6
|
|
|
4.7
|
|
|
10.1*
|
|
|
31.1*
|
|
|
31.2*
|
|
|
32.1**
|
|
|
101.INS*
|
|
XBRL Instance Document
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB*
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Filed herewith.
|
**
|
Furnished herewith.
|
SESEN BIO, INC.
|
||
|
|
|
By:
|
|
/s/ Thomas R. Cannell, D.V.M.
|
|
|
Thomas R. Cannell, D.V.M.
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer and Duly Authorized Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Sesen Bio, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Thomas R. Cannell, D.V.M.
|
Thomas R. Cannell, D.V.M.
|
President and Chief Executive Officer
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Sesen Bio, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Richard F. Fitzgerald
|
Richard F. Fitzgerald
|
Chief Financial Officer
|
(Principal Financial Officer)
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Thomas R. Cannell, D.V.M.
|
Thomas R. Cannell, D.V.M.
|
President and Chief Executive Officer
|
(Principal Executive Officer)
|
/s/ Richard F. Fitzgerald
|
Richard F. Fitzgerald
|
Chief Financial Officer
|
(Principal Financial Officer)
|