4SC AG provides results for financial year 2022 and outlook for 2023
Planegg-Martinsried, Germany, 17 March 2023 – 4SC AG (4SC, FSE Prime Standard: VSC) today published the financial results for the financial year ended 31 December 2022, presenting all material reporting period developments and provides an outlook for 2023. The full report is available at 4SC’s website.
Key highlights of 2022
4SC’s key achievements in 2022 are summarized below:
- In 2022 4SC focused the vast majority of its resources on achieving a result for the ongoing pivotal RESMAIN trial and on preparing for the commercialization of resminostat in the event of positive data. Recruitment of the RESMAIN study was officially completed in the second quarter of 2022 with a total of 201 patients and as such 4SC expects the first study results to be available in the second quarter of 2023.
- In February 2022, the Company announced its decision to discontinue the development of domatinostat.
- In the first half of 2022, 4SC entered into a loan agreement with its largest shareholder, giving the Company access to a further 3 million Euros in funding, none of which was drawn down in 2022.
- In July 2022, 4SC and Vuja De Sciences, Inc. New Jersey, USA (Vuja De) signed a material transfer and option agreement for domatinostat.
- Kathleen Masch-Wiest was appointed as a new member of the Management Board (and Chief Operating Officer, COO) of 4SC AG as of November 2022.
Jason Loveridge, Ph.D., CEO of 4SC, commented: “With the discontinuation of the domatinostat program 4SC dedicated the vast majority of its resources on resminostat, on achieving an outcome for the ongoing pivotal RESMAIN study – where recruitment was completed and closed on 201 patients in total – and preparation for the commercialization of resminostat in case of positive data in 2023. After investing a lot of time and energy in 2022 the Company still expects top-line data for RESMAIN to be available in Q2 2023”.
Business outlook for 2023
4SC’s RESMAIN study will reach an important milestone in 2023, which if positive, would increase the probability of 4SC receiving milestone and royalty payments from Yakult Honsha and create an opportunity to either sell, license or partner the program for commercialization outside of Japan, potentially resulting in a significant return on investment for the Company. If approved by regulators, resminostat would be the first HDAC inhibitor approved in Europe for CTCL and the first and only drug approved for maintenance therapy in this disease, making it the Company’s most valuable asset. Positive data would also create an opportunity to discuss with the United States (US) Food and Drugs Administration regarding requirements for marketing resminostat for CTCL in the US.
In contrast, given the Company’s very heavy focus on resminostat, 4SC’s future success, or failure, as a company is closely linked to the outcome of the RESMAIN study and 4SC cannot rule out that data generated by this study could also indicate that this compound is not sufficiently efficacious in treating patients or that side effects may emerge which are relevant to patient safety. Such findings would be more likely to result in a termination of the development of resminostat and could ultimately result in the liquidation or insolvency of the Company.
Cash balance development in full year 2022 and financial forecast
4SC’s cash balance/funds were at €14,825 thousand on 31 December 2022. The average monthly operating cash burn in 2022 was €1,190 thousand, which was significantly lower than the forecast range of between €1,500 thousand and €1,800 thousand forecast for 2022. This is the result of later payments for agreed milestones in existing contracts for clinical trials. Taking into account the current financial planning and the intended operating activities, the Management Board estimates that current funds should be sufficient to finance 4SC into the second quarter of 2024.
Whilst 4SC’s funds of € 14,825 thousand at the end of 2022 represent a solid cash position entering 2023, it is also clear that the funding environment for biotech companies deteriorated significantly in 2022 and as such management remains cautious as to 4SC’s ability to raise additional funds through further capital measurements and to generate income with business partners. To address this risk, the Management Board has already concluded a loan agreement with its largest shareholder in the first half of 2022, giving the Company access to a further €3 million in funding, none of which was drawn down in 2022. For 2023, 4SC is expecting an average monthly use of cash from operations of between €800 thousand and €1,100 thousand.
4SC AG is a clinical-stage biopharmaceutical company developing small-molecule drugs that target key indications in cancer with high unmet medical needs. 4SC’s pipeline is protected by a comprehensive portfolio of patents and currently comprises one drug candidate in clinical development: resminostat.
4SC aims to generate future growth and enhance its enterprise value by entering into partnerships with pharmaceutical and biotech companies and/or the eventual marketing and sales of approved drugs in select territories by 4SC itself.
4SC is headquartered in Planegg-Martinsried near Munich, Germany. The Company had 17 employees as of 31 December 2022 and is listed on the Prime Standard of the Frankfurt Stock Exchange (FSE Prime Standard: VSC; ISIN: DE000A3E5C40).
Information set forth in this press release contains forward-looking statements, which involve risks and uncertainties. The forward-looking statements contained herein represent the judgement of 4SC as of the date of this press release. Such forward-looking statements are neither promises nor guarantees but are subject to a variety of risks and uncertainties, many of which are beyond 4SC’s control, and which could cause actual results to differ materially from those contemplated in these forward-looking statements. 4SC expressly disclaims any obligation or undertaking to release any updates or revisions to any such statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based.