UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM 8-K
_________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 29, 2024
_______________________________
Molecular Templates, Inc.
(Exact name of registrant as specified in its charter)
_______________________________
Delaware | 001-32979 | 94-3409596 |
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
9301 Amberglen Blvd, Suite 100
Austin, Texas 78729
(Address of Principal Executive Offices) (Zip Code)
(512) 869-1555
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
_______________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common Stock, $0.001 Par Value | MTEM | The Nasdaq Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
On March 29, 2024, Molecular Templates, Inc. (the "Company") announced its financial results for the fourth quarter and full year ended December 31, 2023. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information contained in this Item 2.02 and in the press release furnished as Exhibit 99.1 to this Current Report on Form 8-K shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. The information contained in this Item 2.02 and in the press release furnished as Exhibit 99.1 to this current report on Form 8-K shall not be incorporated by reference into any filing with the U.S. Securities and Exchange Commission made by the Company whether made before or after the date hereof, regardless of any general incorporation language in such filing.
99.1 Press Release dated March 29, 2024
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Molecular Templates, Inc. | ||
Date: March 29, 2024 | By: | /s/ Eric E. Poma, Ph.D. |
Eric E. Poma, Ph.D. | ||
Chief Executive Officer | ||
EXHIBIT 99.1
Molecular Templates, Inc. Reports Fourth Quarter 2023 Financial Results and Business Update
AUSTIN, Texas, March 29, 2024 (GLOBE NEWSWIRE) -- Molecular Templates, Inc. (Nasdaq: MTEM, “Molecular Templates,” or “MTEM”), a clinical-stage biopharmaceutical company focused on the discovery and development of proprietary targeted biologic therapeutics, engineered toxin bodies (“ETBs”), to create novel therapies with potent differentiated mechanisms of action for cancer, today reported financial results for the fourth quarter and full year ended December 31, 2023.
Company Highlights
Eric Poma, PhD., Chief Executive and Chief Scientific Officer of MTEM, stated, “We are very excited to see objective responses in heavily pre-treated, checkpoint-experienced head and neck cancer patients, a setting with high unmet medical need, with MT-6402. We are seeing evidence of monotherapy activity of long duration and in patients refractory to checkpoint therapy through a novel mechanism of tumor microenvironment remodeling. We believe these data demonstrate a new and potentially best-in-class approach to targeting the PD-1-PD-L1 axis.” Dr. Poma further added, “MT-8421 is currently in dose escalation as a novel direct cell-kill approach targeting CTLA-4 to potently deplete Tregs in the tumor microenvironment. Through the first dose cohort, we are already seeing promising and differentiate pharmacodynamic effects including dramatic Treg depletion in patients.”
MT-6402 (PD-L1 ETB)
MT-8421 (CTLA-4 ETB)
MT-0169 (CD38 ETB)
Second Closing of July 2023 Private Placement
On March 28, 2024, the Company and certain institutional and accredited investors (the “March 2024 Purchasers”) entered into an Amended and Restated July 2023 Purchase Agreement pursuant to which the Company will issue common stock, prefunded warrants, and common warrants with an aggregate purchase price of $9.5 million on amended and restated second tranche terms. The second tranche, as amended and restated, will consist of the sale and issuance of (i) 1,209,612 shares of the Company’s common stock (and, in lieu thereof, prefunded warrants to purchase 2,460,559 shares of the Company’s common stock (the “March 2024 Prefunded Warrants”)) for a purchase price of $2.35 per share of the Company’s common stock (the closing price of our common stock on March 27, 2024 as reported by the Nasdaq Capital Market) and $2.349 per March 2024 Prefunded Warrant, and (ii) common stock warrants (the “March 2024 Common Warrants”) to purchase up to 7,340,342 shares of the Company’s common stock (or March 2024 Prefunded Warrants in lieu thereof) at an exercise price of $2.35 per share of the Company’s common stock underlying the March 2024 Common Warrants. The March 2024 Common Warrants will be sold at a price of $0.125 per underlying share of common stock and will have a term of five years. The March 2024 Prefunded Warrants will expire when fully exercised in accordance with their terms. The March 2024 Prefunded Warrants and March 2024 Common Warrants may not be exercised if the aggregate number of shares of our common stock beneficially owned by the holder thereof immediately following such exercise would exceed a specified beneficial ownership limitation (4.99%/9.99%/19.99%); provided, however, that a holder may increase or decrease the beneficial ownership limitation by giving 61 days’ notice to the Company, but not to any percentage in excess of 19.99%. The Amended and Restated July 2023 Purchase Agreement contains customary representations and warranties and agreements of the Company and the Purchasers and customary indemnification rights and obligations of the parties. The second tranche will include gross proceeds of approximately $9.5 million and net proceeds, following the payment of related offering expenses, of approximately $8.9 million.
Key Milestones for 2024
Bristol-Myers Squibb Collaboration Agreement
On March 13, 2024, Bristol-Myers Squibb notified the Company that following a corporate portfolio prioritization process, it does not intend to continue the research collaboration it entered into with the Company pursuant to the BMS Collaboration Agreement and would be terminating the BMS Collaboration Agreement in its entirety. The termination will be effective on June 13, 2024, or 90 days following the Company’s receipt of Bristol-Myers Squibb’s written notice of termination. MTEM plans to reduce costs related to the Collaboration Agreement.
Conferences
MTEM will present an abstract, “First-in-human, dose escalation and expansion study of MT-6402, a novel engineered toxin body (ETB) targeting PD-L1, in patients with PD-L1 expressing relapsed/refractory advanced solid tumors: Interim Data”, Tuesday, April 9, 2024, 9am – 12:30pm ET (Section 48, Poster #19, Abstract #CT191), at the American Association for Cancer Research (“AACR”) Annual Meeting taking place in San Diego, CA.
Financial Results
The net loss attributable to common shareholders for the fourth quarter of 2023 was $3.9 million, or $0.73 per basic and diluted share. This compares with a net loss attributable to common shareholders of $22.0 million, or $5.87 per basic and diluted share, for the same period in 2022.
Revenues for the fourth quarter of 2023 were $7.0 million, compared to $2.6 million for the same period in 2022. Revenues for the fourth quarter of 2023 were comprised of revenues from collaborative research and development agreements with Bristol-Myers Squibb and grant revenue.
Total research and development expenses for the fourth quarter of 2023 were $8.8 million, compared with $17.6 million for the same period in 2022. Total general and administrative expenses for the fourth quarter of 2023 were $3.6 million, compared with $6.1 million for the same period in 2022.
As of December 31, 2023, MTEM’s unrestricted cash and cash equivalents totaled $11.5 million. MTEM anticipates a cash runway into the second quarter of 2024. Following the completion of the recent Second Closing of the July 2023 Private Placement, the Company anticipates that cash runway will extend to the end of the fourth quarter 2024.
For more details on MTEM’s financial results for 2023, refer to Form 10-K filed with the SEC.
Molecular Templates, Inc. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share data) (unaudited) | |||||||||||||||
Three Months Ended December 31, |
Year Ended December 31, |
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2023 | 2022 | 2023 | 2022 | ||||||||||||
Research and development revenue | $ | 6,639 | $ | 2,611 | $ | 52,625 | $ | 19,754 | |||||||
Grant revenue | 377 | — | 4,681 | — | |||||||||||
Total revenue | 7,016 | 2,611 | 57,306 | 19,754 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development | 8,796 | 17,590 | 48,875 | 82,425 | |||||||||||
General and administrative | 3,591 | 6,080 | 18,897 | 26,200 | |||||||||||
Total operating expenses | 12,387 | 23,670 | 67,772 | 108,625 | |||||||||||
Loss from operations | 5,371 | 21,059 | 10,466 | 88,871 | |||||||||||
Interest and other income, net | 178 | 425 | 1,208 | 988 | |||||||||||
Interest and other expense, net | (39 | ) | (1,351 | ) | (2,654 | ) | (4,716 | ) | |||||||
Gain on extinguishment of debt | — | — | 1,795 | — | |||||||||||
Change in valuation of contingent value right | 1,273 | — | 2,457 | — | |||||||||||
Loss on disposal of property and equipment | — | (37 | ) | (475 | ) | (66 | ) | ||||||||
Loss before provision (benefit) for income taxes | 3,959 | 22,022 | 8,135 | 92,665 | |||||||||||
Provision (benefit) for income taxes | (11 | ) | 27 | (11 | ) | 53 | |||||||||
Net loss attributable to common shareholders | $ | 3,948 | $ | 22,049 | $ | 8,124 | $ | 92,718 | |||||||
Net loss per share attributable to common shareholders: | |||||||||||||||
Basic and diluted | $ | 0.73 | $ | 5.87 | $ | 1.80 | $ | 24.69 | |||||||
Weighted average number of shares used in net loss per share calculations: | |||||||||||||||
Basic and diluted | 5,374,268 | 3,756,711 | 4,501,206 | 3,755,564 |
Molecular Templates, Inc. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share data) | ||||||||||
December 31, 2023 |
December 31, 2022 |
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ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 11,523 | $ | 32,190 | ||||||
Marketable securities, current | — | 28,859 | ||||||||
Prepaid expenses | 2,195 | 3,459 | ||||||||
Grants revenue receivable | 250 | — | ||||||||
Other current assets | 2,804 | 3,790 | ||||||||
Total current assets | 16,772 | 68,298 | ||||||||
Operating lease right-of-use assets | 9,161 | 11,132 | ||||||||
Property and equipment, net | 7,393 | 14,632 | ||||||||
Other assets | 2,057 | 3,486 | ||||||||
Total assets | $ | 35,383 | $ | 97,548 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY/(DEFICIT) | ||||||||||
Current liabilities: | ||||||||||
Accounts payable | $ | 1,523 | $ | 504 | ||||||
Accrued liabilities | 4,279 | 8,823 | ||||||||
Deferred revenue, current | 9,031 | 45,573 | ||||||||
Other current liabilities | 2,488 | 2,182 | ||||||||
Total current liabilities | 17,321 | 57,082 | ||||||||
Deferred revenue, long-term | — | 5,904 | ||||||||
Long-term debt, net of current portion | — | 36,168 | ||||||||
Operating lease liabilities, long term portion | 9,742 | 12,231 | ||||||||
Contingent value right liability | 2,702 | — | ||||||||
Other liabilities | 1,406 | 1,295 | ||||||||
Total liabilities | 31,171 | 112,680 | ||||||||
Commitments and contingencies | ||||||||||
Stockholders’ equity/(deficit) | ||||||||||
Preferred stock, $0.001 par value per share: | ||||||||||
Authorized: 2,000,000 shares as of December 31, 2023 and 2022; Issued and outstanding: 250 shares as of December 31, 2023 and 2022 | — | — | ||||||||
Common stock, $0.001 par value per share: | ||||||||||
Authorized: 150,000,000 shares as of December 31, 2023 and 2022; Issued and outstanding: 5,374,268 shares as of December 31, 2023 and 3,756,711 shares as of December 31, 20221 | 5 | 4 | ||||||||
Additional paid-in capital1 | 457,099 | 429,698 | ||||||||
Accumulated other comprehensive loss | — | (66 | ) | |||||||
Accumulated deficit | (452,892 | ) | (444,768 | ) | ||||||
Total stockholders’ equity/(deficit) | 4,212 | (15,132 | ) | |||||||
Total liabilities and stockholders’ equity/(deficit) | $ | 35,383 | $ | 97,548 | ||||||
1. Prior period amounts have been retrospectively adjusted for the 1-for-15 reverse stock split that was effective August 11, 2023.
About Molecular Templates
Molecular Templates is a clinical-stage biopharmaceutical company focused on the discovery and development of targeted biologic therapeutics. Our proprietary drug platform technology, known as engineered toxin bodies, or ETBs, leverages the resident biology of a genetically engineered form of Shiga-like Toxin A subunit to create novel therapies with potent and differentiated mechanisms of action for cancer.
Forward-Looking Statements
This press release contains forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995 (the “Act”). Molecular Templates disclaims any intent or obligation to update these forward-looking statements and claims the protection of the Act’s Safe Harbor for forward-looking statements. All statements, other than statements of historical facts, included in this press release, including, but not limited to those regarding strategy, future operations, the Company’s ability to execute on its objectives, prospects, plans, future clinical development of the Company’s product candidates, any implication that the preliminary results, interim results, or the results of earlier clinical trials or ongoing clinical trials will be representative of the results of future or later clinical trials or final results, the potential benefits, safety or efficacy and any evaluations or judgements regarding the Company’s product candidates, [the results of any strategic process which are inherently uncertain at the present time] and future execution of corporate goals. In addition, when or if used in this press release, the words “may,” “could,” “should,” “continue”, “anticipate,” “potential”, “believe,” “estimate,” “appears”, “expect,” “intend,” “plan,” “predict” and similar expressions and their variants, as they relate to Molecular Templates may identify forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties. Actual events or results may differ materially from those discussed in the forward-looking statements as a result of various factors including, but not limited to the following: the continued availability of financing on commercially reasonable terms, whether Molecular Templates’ cash resources will be sufficient to fund its continuing operations; the results of MTEM’s ongoing clinical studies and the ability to effectively operate MTEM, and those risks identified under the heading “Risk Factors” in Molecular Templates’ filings with the Securities and Exchange Commission (the “SEC”), including its Form 10-K for the year ended December 31, 2023 and any subsequent reports filed with the SEC. Any forward-looking statements contained in this press release speak only as of the date hereof, and Molecular Templates specifically disclaims any obligation to update any forward-looking statement, whether because of new information, future events or otherwise.
Contacts:
grace.kim@mtem.com