Compugen Reports First Quarter 2020 Results

HOLON, Israel, May 6, 2020 /PRNewswire/ -- Compugen Ltd. (NASDAQ: CGEN), a clinical-stage cancer immunotherapy company and a leader in predictive target discovery, today reported financial results for the first quarter ended March 31, 2020.

"We have entered 2020 well positioned and with significant momentum to advance our clinical programs that address novel, internally-discovered, drug targets for cancer immunotherapy," said Anat Cohen-Dayag, Ph.D., President and CEO of Compugen. "On the clinical front, we recently presented at AACR updated data from our ongoing Phase 1 dose escalation study of COM701 as a monotherapy and in combination with Opdivo(®). These encouraging data, which include signals of durable disease control and confirmed partial responses both in the monotherapy and combination arms, further confirm our hypothesis that by blocking PVRIG, an important new checkpoint, COM701 has the potential to broaden the patient population that can benefit from cancer immunotherapy. We also dosed the first patient in the Phase 1 study for COM902, our anti-TIGIT therapeutic antibody, which would enable us to clinically evaluate the dual blockade of PVRIG and TIGIT inhibitory pathways in the DNAM axis."

Dr. Cohen-Dayag added, "Our continued progress and execution enabled us to successfully raise approximately $79 million through an underwritten public offering, which we believe is testament to the growing recognition of our science-driven approach backed by our computational discovery capabilities. With our strengthened balance sheet, we are well positioned to continue our strategic clinical development plans which will be expanded to also include a third clinical trial, a Phase 1/2 triple combination study testing COM701 with Bristol-Myers Squibb's Opdivo(®) and their investigational TIGIT inhibitor in the second half of this year, as well as advance our early-stage programs to propel our future therapeutic pipeline. We are fortunate that, to date, the COVID-19 pandemic has not significantly impacted our operations, including our clinical development timelines. For now, we are not changing the anticipated data readouts and milestones timelines we previously provided. We are grateful to our employees and clinical investigators for their continued hard work and dedication. In these unique circumstances we remain focused on advancing our clinical and early-stage programs to maintain positive momentum to achieve our goals."

First Quarter 2020 and Recent Highlights

    --  Presented updated data from the dose escalation arms of the Phase 1
        trial of COM701 in patients with advanced solid tumors at The 2020
        American Association for Cancer Research (AACR) Virtual Annual Meeting I
        --  COM701 was well-tolerated through 20 mg/kg IV Q4 weeks as a
            monotherapy and 10 mg/kg IV Q4 weeks in combination with Opdivo(®
            )(480 mg IV Q4 weeks) with no dose-limiting toxicities reported.
            --  No increased toxicity was observed in the combination arm.
            --  No patients discontinued treatment due to toxicity of any study
        --  Preliminary COM701 pharmacokinetic data supports IV Q4 weeks dosing,
            allowing dosing schedule aligned with Opdivo(®).
        --  Encouraging disease control rates of 69% (11/16) for monotherapy and
            75% (9/12) for the combination arm.
            --  50% of patients (6/12) in the combination arm remain on study,
                some with continued responses observed beyond 200 days of
        --  Durable responses of stable disease for over six months in six of 28
            patients (21%) across treatment arms.
        --  The two patients previously reported with confirmed partial
            responses, one from the monotherapy arm (microsatellite stable
            primary peritoneal cancer) and one from the combination arm
            (microsatellite stable colorectal cancer), remain on treatment.
        --  Enrollment in the COM701 monotherapy dose escalation arm is
            completed and enrollment in the combination dose escalation arm at
            20 mg/kg IV Q4 weeks is ongoing. Enrollment in the monotherapy
            expansion cohorts is expected to begin in Q2 2020.
    --  Dosed the first patient in a Phase 1 dose escalation clinical trial of
        COM902, an immuno-oncology therapeutic antibody targeting TIGIT, in
        patients with advanced malignancies.
    --  Announced plans to expand the Bristol-Myers Squibb collaboration with a
        Phase 1/2 triple combination study to evaluate COM701 in combination
        with Opdivo(®) and BMS-986207, Bristol-Myers Squibb's investigational
        TIGIT inhibitor. This study is expected to begin in 2H 2020.
    --  Strengthened intellectual property portfolio
        --  Granted EPO Patent No. 3295951, covering the composition of matter
            for COM701 and backup antibodies including any anti-PVRIG antibody
            having the binding fragments of COM701 or backup antibodies for the
            treatment of cancer.
        --  Granted U.S. Patent No. 10,550,173, covering methods of screening
            for anti-PVRIG antibodies that inhibit the binding of PVRIG with
        --  Granted EPO Patent No. 3258951, covering the use of any anti-PVRIG
            antibody that activates T cells and/or NK cells, in the treatment of
    --  Published a peer-reviewed paper in Cancer Immunology Research in
        collaboration with Bayer demonstrating in vitro T cell activation and in
        vivo anti-tumor activity of BAY 1905254, a first-in-class
        immuno-oncology antibody targeting ILDR2. ILDR2 is a novel immune
        checkpoint discovered computationally by Compugen which is currently
        being evaluated by Bayer in a Phase 1 study as monotherapy and in
        combination with Keytruda®.
    --  Completed an underwritten public offering of 8,816,339 ordinary shares
        (including the shares issued in Q2 upon exercise of the underwriters'
        option) at $9.00 per share. The net proceeds from the offering were
        approximately $74 million, after deducting underwriting discounts and
        commissions and other offering expenses that were paid by the Company.

Financial Results

Research and development expenses for the first quarter ended March 31, 2020 were $4.7 million, compared with $6.3 million in the comparable quarter in 2019. The decrease is attributed mostly to the restructuring process announced at the end of the first quarter of 2019 offset by an increase in expenses associated with clinical-related activities.

Net loss for the first quarter of 2020 was $7.1 million, or $0.10 per basic and diluted share, compared with a net loss of $8.4 million, or $0.14 per basic and diluted share, in the comparable quarter of 2019.

As of March 31, 2020, cash, cash related accounts and short-term and long-term bank deposits totaled approximately $121.2 million, compared with approximately $43.9 million as of December 31, 2019. The increase in cash balances during the first quarter is attributed to approximately $70 million of net proceeds from the underwritten public offering (excluding the shares issued upon exercise of the underwriters' option in the second quarter), $5.2 million from the exercise of warrants and $7.2 million from the exercise of employee options, offset by operating expenses and working capital. The Company has no debt.

Conference Call and Webcast Information

The Company will hold a conference call today, May 6, 2020, at 8:30 AM ET to review its first quarter 2020 results. To access the conference call by telephone, please dial 1-888-407-2553 from the United States, or +972-3-918-0610 internationally. The call will also be available via live webcast through Compugen's website, located at the following link. Following the live audio webcast, a replay will be available on the Company's website.

(Tables to follow)

About Compugen

Compugen is a clinical-stage therapeutic discovery and development company utilizing its broadly applicable, predictive computational discovery platforms to identify novel drug targets and develop therapeutics in the field of cancer immunotherapy. The Company's lead product candidate, COM701, a first-in-class anti-PVRIG antibody, for the treatment of solid tumors, is undergoing a Phase 1 clinical study. In addition, COM902, Compugen's antibody targeting TIGIT, is in a Phase 1 clinical study. The Company's therapeutic pipeline also includes early stage immuno-oncology programs focused largely on myeloid targets. Compugen's business model is to selectively enter into collaborations for its novel targets and related drug product candidates at various stages of research and development. The Company is headquartered in Israel, with offices in South San Francisco, CA. Compugen's shares are listed on the Nasdaq and the Tel Aviv Stock Exchange under the ticker symbol CGEN. For additional information, please visit Compugen's corporate website at

Forward-Looking Statement

This press release contains "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended, and the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on the current beliefs, expectations and assumptions of Compugen. Forward-looking statements can be identified by the use of terminology such as "will," "may," "expects," "anticipates," "believes," "potential," "plan," "goal," "estimate," "likely," "should," "confident," and "intends," and similar expressions that are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements include, but are not limited to, statements regarding the our hypothesis that by blocking PVRIG, an important new checkpoint, COM701 has the potential to broaden the patient population that can benefit from immunotherapy, our plans to begin the Phase 1/2 triple combination study testing COM701 with Bristol-Myers Squibb's Opdivo(®) and their investigational TIGIT inhibitor in the second half of this year, as well as advance our early-stage programs to propel our future pipeline, our anticipation to meet our anticipated data readouts and milestones timelines that we previously provided and the fact that enrollment in the expansion cohorts is expected to begin in the Q2 2020. These forward-looking statements involve known and unknown risks and uncertainties that may cause the actual results, performance or achievements of Compugen to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Among these risks: Compugen's operations could be affected by the outbreak and spread of COVID-19, clinical development involves a lengthy and expensive process, with an uncertain outcome and Compugen may encounter substantial delays or even an inability to begin clinical trials for any specific product, or may not be able to conduct or complete its trials on the timelines it expects; Compugen relies, and expects to continue to rely, on third parties to conduct its clinical trials and if these third parties do not successfully carry out their contractual duties, comply with regulatory requirements or meet expected deadlines (including as a result of the effect of the Coronavirus), Compugen may experience significant delays in the conduct of its clinical trials; Compugen's ability to present data derived from collaborations with its partners is dependent in some cases on the agreement of its partners to present such data, and in any event is dependent on our acceptance to present data in relevant conferences; Compugen's approach to the discovery of therapeutic products is based on its proprietary computational target discovery infrastructure, which is unproven clinically; Compugen does not know whether it will be able to discover and develop additional potential product candidates or products of commercial value; Compugen's business model is substantially dependent on entering into collaboration agreements with third parties; and Compugen may not be successful in generating adequate revenues or commercializing aspects of its business model. These risks and other risks are more fully described in the "Risk Factors" section of Compugen's most recent Annual Report on Form 20-F filed with the Securities and Exchange Commission (SEC) as well as other documents that may be subsequently filed by Compugen from time to time with the SEC. In addition, any forward-looking statements represent Compugen's views only as of the date of this release and should not be relied upon as representing its views as of any subsequent date. Compugen does not assume any obligation to update any forward-looking statements unless required by law.

              COMPUGEN LTD.


            (U.S. dollars in thousands, except for share and per-share amounts)

                                                                                                                           Three Months Ended

                                                                                                                                March 31,

                                                                                                                                2020                    2019



            Cost of revenues

              Gross profit

              Operating expenses

            Research and development expenses                                                                                 4,712                   6,335

            Marketing and business development expenses                                                                         210                     213

            General and administrative expenses                                                                               2,476                   1,966

              Total operating expenses                                                                               7,398                   8,514

              Operating loss                                                                                       (7,398)                (8,514)

            Financial and other income, net                                                                                     270                     106

              Loss before taxes on income                                                                          (7,128)                (8,408)

            Taxes on income

              Net loss                                                                                             (7,128)                (8,408)

            Basic and diluted net loss per ordinary share                                                                    (0.10)                 (0.14)

            Weighted average number of ordinary shares used in computing                                                 70,276,521              60,016,734
    basic and diluted net loss per share

                COMPUGEN LTD.


           (U.S. dollars, in thousands)

                                                                         March 31,          December 31,

                                                                              2020                   2019



                   Current assets

      Cash, cash equivalents, short-
       term bank deposits and
       restricted cash                                                     121,192                 43,879

      Other accounts receivable and
       prepaid expenses                                                      1,093                  1,121

                   Total current assets                                    122,285                 45,000

                   Non-current assets

      Long-term prepaid expenses                                             1,165                    693

     Severance pay fund                                                     2,426                  2,485

      Operating lease right to use
       asset                                                                 3,088                  3,247

      Property and equipment, net                                            2,182                  2,338

                   Total non-current assets                                  8,861                  8,763

                   Total assets                                            131,146                 53,763


                   Current liabilities

      Other accounts payable, accrued
       expenses and trade payables                                           7,376                  5,445

      Current maturity of operating
       lease liability                                                         489                    600

      Short-term deferred
       participation in R&D expenses                                           842                    774

                   Total current liabilities                                 8,707                  6,819

                   Non-current liabilities

      Long-term deferred participation
       in R&D expenses                                                       2,454                  2,691

      Long-term operating lease
       liability                                                             2,816                  2,978

     Accrued severance pay                                                  3,055                  2,954

                   Total non-current liabilities                             8,325                  8,623

                   Total shareholders' equity                              114,114                 38,321

                   Total liabilities and
                    shareholders' equity                                   131,146                 53,763

Company contact:
Elana Holzman
Director, Investor Relations and Corporate Communications
Compugen Ltd.
Tel: +972 (3) 765-8124

Investor Relations contact:
Bob Yedid
LifeSci Advisors, LLC
Tel: +1 (646) 597-6989

Media contact:
Josephine Belluardo, Ph.D.
LifeSci Communications
Tel: +1 (646) 751-4361

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SOURCE Compugen Ltd.