SUZHOU, China, March 25, 2021 – CStone Pharmaceuticals (CStone, HKEX: 2616), a leading biopharmaceutical company focused on developing and commercializing innovative immuno-oncology therapies and precision medicines, today reported financial results and business highlights for the full-year of 2020.
“Our achievements in 2020 amount to a step-change in our journey to become a commercial-stage biopharmaceutical company,” said Dr Frank Jiang, Chairman and CEO of CStone, “We executed a deliberate and meticulously crafted strategy, overachieving significant objectives across all aspects of our business. Our efforts bolstered our capital base, generated immediate and potential long-term value for late-stage assets, enriched our early-stage portfolio, and enhanced our research capabilities. Also, securing our first precision medicine approval and second imminent approval demonstrates our ability to bring innovative drugs to market with speed and quality.
“We have a full commercialization and clinical development agenda in 2021 with a slate of pending approvals for new drug applications as well as upcoming NDA filings. Our expanded commercial team is ready to support product launches with comprehensive coverage of hospitals and cities, expanding product accessibility. And we have exciting candidates in our early-stage pipeline. These opportunities offer multiple pathways for long-term growth and value creation in the service of our core mission: to provide breakthrough therapies for cancer patients to help them live longer and healthier lives.”
The past year was rich with material developments for CStone. We continued to execute and implement a systematic growth strategy, achieving significant objectives across all aspects of our business, from pipeline development to the buildout of our commercialization capabilities. Among our business development achievements, we formed agreements that maximize the commercial potential of our two lead immuno-oncology (“IO”) assets and expand the opportunities for combination strategies globally. As a result, we have reached an inflection point in our transition to a commercial stage company with global partnerships and business development opportunities, a revamped R&D direction and portfolio focused on promising new drug categories and combo therapies, and a commercial infrastructure with a demonstrated ability to market our products.
For the year ended December 31, 2020 and as of the date of this announcement, significant progress has been made with respect to our product pipeline and business operations:
I. Secured Approval for First-in-Class Precision Medicines; Second Expected Imminently
On March 24, 2021, the National Medical Products Administration (“NMPA”) of the People’s Republic of China (“China”) approved GAVRETO® (pralsetinib, RET inhibitor) for the treatment of adults with locally advanced or metastatic RET fusion-positive non- small cell lung cancer (“NSCLC”) after platinum-based chemotherapy. GAVRETO® is the first approved selective RET inhibitor in China and first approved precision therapy for CStone.
We expect the NMPA of China will soon approve AYVAKIT® (avapritinib, KIT/PDGFRA inhibitor) for the treatment of adults with unresectable or metastatic gastrointestinal stromal tumor (“GIST”) harboring a PDGFRA exon 18 mutation, including PDGFRA D842V mutations. Once approved, AYVAKIT® is expected to be China’s first approved precision therapy for patients with PDGFRA exon 18 mutant GIST.
II. Filed Multiple NDAs for Key Late-stage Assets
We continued to advance our pipeline of by positioning multiple late-stage first-in-class assets across various oncology therapeutic areas and indications for commercial readiness through successful New Drug Application (“NDA”) submissions.
• Pralsetinib (CS3009, RET inhibitor)
– In September 2020, an NDA was accepted by the NMPA for the treatment of patients with RET fusion-positive NSCLC previously treated with platinum- based chemotherapy. The Priority Review Designation was granted by the NMPA in September 2020. We received an NDA approval on March 24, 2021.
– In December 2020, a Breakthrough Therapy Designation (“BTD”) was granted by the NMPA for the patients with advanced or metastatic RET-mutant medullary thyroid cancer (“MTC”). We submitted an NDA to the NMPA in March 2021 for the treatment of patients with advanced or metastatic RET-mutant MTC and RET fusion-positive thyroid cancer.
• Avapritinib (CS3007, KIT/PDGFRA inhibitor)
– We submitted an NDA to the NMPA for avapritinib for adults with unresectable or metastatic GIST harboring a PDGFRA exon 18 mutation, including PDGFRA D842V mutations, which was accepted in April 2020. The Priority Review Designation was granted by the NMPA in July 2020. We expect to receive the NDA approval imminently.
– We submitted an NDA to Taiwan Food and Drug Administration (“TFDA”) for the same indication in March 2020. We expect to receive the NDA approval in the first half of 2021.
• Sugemalimab (CS1001, PD-L1 antibody)
– The Phase III trial of sugemalimab as first-line treatment for Stage IV squamous and non-squamous NSCLC met its primary endpoint in August 2020. An NDA for this indication was accepted by NMPA in November 2020. We expect to receive the NDA approval in the second half of 2021.
– Sugemalimab demonstrated best-in-class potential among PD-1 and PD-L1 monoclonal antibodies for the treatment of patients with stage IV squamous and non-squamous NSCLC, and is the only PD-L1 proven efficacious for both NSCLC histologies. When combined with chemotherapy, it reduced the risk of cancer progression or death by 50% over chemotherapy alone. These results are among the best of published data for competitor PD-1 and PD-L1 monoclonal antibodies. Furthermore, sugemalimab demonstrated a more favorable safety profile with lower incidences of severe immune related adverse events such as pneumonitis.
III. Additional Significant Late-stage Pipeline Achievements
We achieved significant milestones in 2020 with additional core late-stage molecules, and are advancing their development.
• Sugemalimab (CS1001, PD-L1 antibody)
– We received the Orphan Drug Designation (“ODD”) for treating patients with T-cell lymphoma and the BTD for treating adult patients with relapsed or refractory (“R/R”) extranodal natural killer/T cell lymphoma (“ENKTL”) from the United States (“U.S.”) Food and Drug Administration (“FDA”) in October 2020, following the Investigational New Drug (“IND”) approval in August 2020. BTD was granted by the NMPA for the treatment of patients with R/R ENKTL in February 2021.
– We are conducting a phase III trial of sugemalimab in patients with stage III NSCLC as monotherapy in the maintenance setting following chemoradiation. The enrollment was completed in December 2020. We expect the top-line results readout in the first half of 2021.
– We have completed proof of concept clinical studies for sugemalimab in several cancer types and presented data at international conferences in 2020. These results demonstrated sugemalimab is highly active in esophageal cancer and gastric cancer, and provided strong supporting evidence to the ongoing phase III trials in these cancers.
• CS1003 (PD-1 antibody)
– We are conducting a global phase III trial of CS1003 in combination with LENVIMA® (lenvatinib), a standard-of-care TKI in patients with advanced hepatocellular carcinoma (“HCC”). CS1003 was granted an ODD by U.S. FDA for the treatment of patients with HCC in July 2020.
IV. Further Built Out Robust Commercialization Capabilities
We invested in – and achieved in developing – robust and highly efficient commercialization capabilities to support the successful launch of global breakthrough therapies in 2021. We demonstrated our capabilities with the successful launch of two late-stage drugs via the Bo’ao pilot zone.
• In 2020, our commercial team laid the groundwork for four 2021 commercial launches: pralsetinib (RET inhibitor), avapritinib (KIT/PDGFRA inhibitor) and ivosidenib (IDH1 inhibitor) in mainland China and avapritinib in Taiwan. Specific achievements include:
– Built a full-fledged commercial team: We built strong commercial capabilities with a seasoned leadership team and overall team size reaching approximately
200 employees including sales staff, with plans to reach 300 by the end of 2021. The rapid ramp-up of our commercial capabilities has resulted in comprehensive coverage of 4 key oncology areas, over 400 hospitals and approximately 100 cities. This coverage represents hospitals that account for over 80% of the sales generated from prescriptions of precision medicines. With this coverage and our first-mover advantage in precision medicines, we believe we are building a commercial workforce that will fully reach our commercial aspirations.
– Successful brand development initiatives: We proactively engaged key opinion leaders (“KOL”) and participated in activities of reputable local cancer societies to secure important recognition and recommendations, while launching various programs to position CStone as a source of information for healthcare professionals’ (“HCP”) on topics related to diseases, treatment paradigms and diagnostics standards. Avapritinib and ivosidenib were formally recommended in the Chinese Society of Clinical Oncology (“CSCO”) guidelines for the treatment of GIST and hematological malignancies, respectively. Meanwhile, we leveraged innovative digital tools and channels to further broaden CStone’s profile and brand awareness within the healthcare information ecosystem. Our digital platforms attracted tens of thousands of virtual participants and visitors for CStone’s R&D day and CSCO virtual booth. Also, we launched a WeChat platform to serve as an education and information portal for future patient education.
– Removal of drug adoption barriers: We proactively collaborated with multiple gene testing companies to build up testing standards and perceptions by providing molecular diagnostics training to pathologists, among other efforts. Additionally, we entered a collaboration agreement with MediTrust to launch an early bird program for avapritinib and pralsetinib. And, we have initiated discussions and negotiations with different partners on developing a multilayer payment system to improve patient affordability.
– Expanding product accessibility: In the third quarter of 2020, we successfully launched avapritinib and pralsetinib in the Bo’ao pilot zone, allowing Chinese patients to have early access to an innovative precision medicine prior to the NDA approval by the NMPA of China. This program has been record-breaking with fastest approval timeline in Bo’ao, and has generated tremendous interest from HCP and patients. In an effort to increase the possibility of including our drugs in basic medical insurance, we have initiated an external consulting project and formed an internal taskforce to develop a strategy and implementation roadmap to ensure the widest accessibility for CStone products via National Reimbursement Drug List (“NRDL”) listing. Also, we have entered into a strategic collaboration agreement with Sinopharm Group Co., Ltd. to establish access to distribution channels, making sure prescribed medicines can be delivered quickly to patients.
V. Executed Transformative Business Development Initiatives
2020 was a breakout year for CStone’s business development achievements. The Company forged strategic partnerships to commercialize two lead IO assets, and materially advance our innovation and commercialization capabilities. In particular, these achievements provided capital for growth investments, opened global markets for our products, engaged new partners for co-development and licensing initiatives, and supported the development of our portfolio around emerging therapeutics such as antibody drug conjugates (“ADC”) and multi-specific antibodies.
• In September 2020, we entered into a multi-dimensional strategic collaboration with Pfizer that met several immediate objectives and enhanced the Company’s ability to invest in its growth strategy and development initiatives. Pfizer invested US$200 million in CStone shares at a price of HK$13.37 per share and was licensed CStone’s late-stage oncology asset sugemalimab in mainland China, maximizing the domestic revenue-generating potential of this core late-stage asset. By harnessing Pfizer’s vast commercial platform for sugemalimab, this partnership has allowed CStone to focus its commercialization capabilities around other key late-stage assets. In addition, CStone and Pfizer will together select late-stage assets for co-development in the Greater China market. Both parties expect to announce the updates for such co-development this year.
• In October 2020, we entered into an exclusive out-licensing agreement with EQRx, INC. (“EQRx”) for exclusive rights to our sugemalimab and CS1003 for development and commercialization outside of Greater China. This agreement provides a pathway to bring these important late-stage assets to global patient communities by partnering with a firm that has unique capabilities to shepherd them through global development and position them competitively for commercialization against established alternative treatments. Additionally, we retained the rights to develop and commercialize CS1003 in Greater China, where we can continue to pursue development as a monotherapy or as part of its combination strategy for this drug.
• In October 2020, we entered into an exclusive licensing agreement with LegoChem Biosciences, Inc. (“LegoChem Biosciences”) to lead global development and commercialization of LCB71, an ADC targeting receptor tyrosine kinase-like orphan receptor 1 (“ROR1”), outside the Republic of Korea. The agreement bolsters CStone’s precision medicine franchise with a new modality, and provides a potential best-in-class asset in an emerging and promising course of therapeutics.
VI. Elevated of Research Capabilities and Advanced Pipeline 2.0
We are undertaking a strategic effort to elevate our research capabilities to focus on developing best-in-class and first-in-class assets, and enhancing our internal sources of innovation. We expect this effort to translate breakthrough science and clinical insights into differentiated products, and position CStone in emerging therapeutic modalities and mechanisms of action with 1-2 IND filings per year. Our near-term focus is on assets in two modalities: ADC and multi-specific biologics. We are preparing two assets for IND filings this year:
• CS2006 (NM21-1480, PD-L1×4-1BB×HSA tri-specific molecule)
– In the second quarter of 2020, our partner, Numab Therapeutics AG (“Numab”), received a “may proceed” letter from the U.S. FDA for the IND application for NM21-1480. We received an IND approval for CS2006 from TFDA in the third quarter of 2020. The dose escalation is ongoing and includes sites in the US and Taiwan. We have completed dose level 4 enrollment in US, no dose limiting toxicity (“DLT”) identified so far. We expect to submit an IND application to the NMPA in the second half of 2021.
• CS5001 (LCB71, ROR1 ADC)
– In the fourth quarter of 2020, we in-licensed CS5001 (LCB71) from LegoChem Biosciences. CS5001 is a highly differentiated ADC targeting ROR1, a promising ADC target for multiple solid and hematological malignancies. ROR1 is highly expressed across a variety of cancers including various forms of leukemia and non-Hodgkin lymphoma, and breast, lung, and ovarian cancers. We expect to submit IND/CTA applications for CS5001 by the end of 2021.
In addition to CS2006 and CS5001, multiple potentially first-in-class or best-in-class programs including two multi-specific biologics and one ADC are under development.
For the year ended December 31, 2020, our revenue amounted to RMB1,038.8 million. The research and development expenses excluding the share-based payment expenses and the administrative and selling expenses excluding the share-based payment expenses amounted to RMB1,245.7 million and RMB287.6 million respectively. The loss for the year excluding the effect of the fair value changes of the conversion feature of preferred shares and share-based payment expenses amounted to RMB865.0 million.
As of December 31, 2020, our time deposits and cash and cash equivalents were RMB3,383.4 million.
Annual Results Presentation Information
The Company will host a live webcast for 2020 annual result presentation at 10am HKT, March 26, 2021, please find the access information as below.
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CStone is a biopharmaceutical company focused on the development and commercialization of innovative tumor immunotherapy and precision medicines to meet the ardent medical needs of cancer patients in China and worldwide. Established at the end of 2015, CStone Pharmaceuticals has assembled a world-class management team with extensive experience in innovative drug development, clinical research, and commercialization. With a strategic emphasis on immuno-oncology combination therapies, the Company has built an oncology-focused pipeline of 14 drug candidates. Currently, one product has been approved by China NMPA and multiple late-stage candidates are at pivotal clinical trials or registration stages. CStone’s vision is to become a world-renowned biopharmaceutical company leading the way to conquering cancer.
The forward-looking statements made in this article only relate to events or information as of the date when the statements are made in this article. Except as required by law, we undertake no obligation to update or publicly revise any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. You should read this article completely and with the understanding that our actual future results or performance may be materially different from what we expect. All statements in this article are made on the date of publication of this article and may change due to future developments.