The company expects to decrease its operating expenses by about 40% this year compared to 2019.
Boston-based Verastem Oncology announced a new strategic direction. It plans to focus on the development of CH5126766 (VS-6766), its RAF-MEK inhibitor, in combination with defactinib, a focal adhesion kinase (FAK) inhibitor, for treatment of KRAS mutation solid tumors.
Meanwhile, Verastem Oncology will continue to develop Copiktra (duvelisib) for relapsed or refractory (r/r) peripheral T-cell lymphoma (PTCL). Early this year, Verastem Oncology licensed VS-6755 from Chugai Pharmaceutical Co. It was in a Phase I trial with expansion cohorts in this patient population, including low-grade serious ovarian cancer (LGSOC), non-small cell lung cancer (NSCLC) and colorectal cancer (CRC). The clinal trial of defactinib/VS-6766 is supported by the single-agent Phase II trials of defactinib in KRAS mutant NSCLC and VS-6766 in KRAS mutant NSCLC and LGSOC.
Under the terms of that deal, Verastem paid Chugai $3 million up front and will pay royalties on commercial products.
“Based on the single-agent defactinib results in KRAS mutant NSCLC, we conducted an internal preclinical effort to identify drug classes that were synergistic with defactinib and saw the highest level of synergy in combination with MEK inhibitors and, specifically, with CH5126766,” said Dan Paterson, president and chief operating officer of Verastem Oncology, in January. “The exciting early clinical results led to our decision to enter into a partnership with Chugai for CH5126766 and accelerate the combination development program for patients with KRAS mutant cancers, which are highly aggressive and recurrent. We plan to initiate discussions with regulatory authorities about our development plans and to define the registration path early this year.”
In today’s announcement, Verastem also indicated it had generated preliminary unaudited Copiktra net product revenue of $3.6 million in the fourth quarter of 2019, down from $3.0 million for the third quarter, with $12.3 million for the full year.
As it proceeds, the company expects to decrease the resources directed to selling Copiktra for its current indications. This includes decreasing the size of its salesforce and non-core clinical research. It will shift its Copiktra promotional efforts toward large, community-based practices and academic institutions.
From this, the company expects to decrease its operating expenses by about 40% this year compared to 2019. It expects R&D and selling, general and administrative expenses for 2020 to range from $70 to $85 million. As of December 31, 2019, it had preliminary unaudited and short-term investments of $111.3 million.
The company also announced completing a private placement of about 46.5 million shares of common stock at $2.15 per share on March 3, which brought in about $100 million before deducting expenses. This and the revenue from Copiktra, should fund operations into the fourth quarter of 2021.
“With our newly expanded development pipeline and strengthened balance sheet, we believe this new strategic direction will be transformative for Verastem Oncology as we will have the opportunity to rapidly advance the development of the clinical programs that we believe will yield the greatest results for patients, physicians and shareholders,” said Brian Stuglik, Verastem Oncology’s chief executive officer. “We are honored to have leading life science investors participate in our recently announced private placement. Verastem Oncology’s mission is centered on improving the lives of cancer patients and we believe our work in collaboration with the scientific community has presented significant opportunity to make further meaningful strides in areas of critical need.”
