8-K

 

 

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): April 2, 2018

 

 

ARMO BIOSCIENCES, INC.

(Exact name of Registrant as Specified in Its Charter)

 

 

 

Delaware   001-38345   27-3454138

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

575 Chesapeake Drive

Redwood City, CA 94063

    94063
(Address of Principal Executive Offices)     (Zip Code)

(650) 779-5075

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(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 (see General Instructions A.2. below):

 

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))

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.  ☒

 

 

 


Item 2.02 Results of Operations and Financial Condition.

On April 2, 2018, ARMO BioSciences, Inc. reported financial results for the year ended December 31, 2017. A copy of the press release is furnished as Exhibit 99.1 to this report and incorporated by reference.

The press release is furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. The information shall not be deemed incorporated by reference into any other filing with the Securities and Exchange Commission made by ARMO BioSciences, Inc., whether made before or after today’s date, regardless of any general incorporation language in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit

Number

  

Description

99.1    Press release dated April 2, 2018.


Exhibit Index

 

Exhibit

Number

  

Description

99.1    Press release dated April 2, 2018.


SIGNATURES

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 thereunto duly authorized.

 

   

ARMO BIOSCIENCES, INC.

Date: April 2, 2018     By:  

/s/ Herb Cross

     

Herb Cross

     

Chief Financial Officer

EX-99.1

Exhibit 99.1

 

LOGO

ARMO BioSciences Reports FY 2017 Financial Results

First Patient Enrolled in CYPRESS 1 Trial in Non-Small Cell Lung Cancer

REDWOOD CITY, Calif., April 2, 2018 – ARMO BioSciences, Inc. (Nasdaq:ARMO), a late-stage immuno-oncology company, today announced its financial results for the fiscal year ended December 31, 2017.

“2017 was a great year for ARMO as we advanced the development of AM0010 as an immuno-oncology therapeutic,” said Peter Van Vlasselaer, PhD Chief Executive Officer of ARMO Biosciences. “In the first quarter of 2018 we have already completed our over-subscribed initial public offering, successfully cleared the first interim analysis in the SEQUOIA trial in pancreatic cancer, and have now dosed the first patients in both our CYPRESS 1 and CYPRESS 2 NSCLC Phase 2 trials. With first looks at CYPRESS data, the commencement of a clinical trial in Renal Cell Carcinoma (RCC) and the commencement of a Phase 1 dose escalation trial of our anti-PD-1 checkpoint inhibitor (AM0001) all expected by the end of the year, 2018 is shaping up to be another exciting year for ARMO.”

Financial Results for the Year Ended December 31, 2017

Net loss for the year ended December 31, 2017 was $42.4 million or $28.52 per share, as compared to $33.6 million or $26.25 per share for the same period in 2016.

Research and development (R&D) expenses were $37.0 million for the year ended December 31, 2017 as compared to $29.2 million for the same period in 2016. The increase in R&D expense was primarily due to the commencement of the SEQUOIA Phase 3 pancreatic cancer trial in the first half of 2017.

General and administrative (G&A) expenses were $5.7 million for fiscal 2017 compared to $4.6 million for the same period in 2016. The increase in G&A expenses was due primarily to higher legal and employee-related costs associated with preparing to become a public reporting company.

As of December 31, 2017, ARMO had cash and cash equivalents totaling $49.5 million, compared to $26.7 million at December 31, 2016.

Subsequent to year end 2017, ARMO completed its initial public offering in which it sold shares of its common stock to the public generating net proceeds of approximately $133.2 million, after deducting underwriting discounts and commissions and estimated offering expenses.

About AM0010 Immunotherapy

AM0010 (pegilodecakin) is a long-acting PEGylated form of recombinant human Interleukin-10 (IL-10) which exerts an anti-cancer effect by stimulating the survival, expansion and cytotoxic (killing) potential of CD8+ T cells. An abundance of tumor-infiltrating CD8+ T cells is believed to improve the prognosis and lengthen the survival of cancer patients. AM0010 is currently being investigated in SEQUOIA, a pivotal Phase 3 randomized clinical trial in pancreatic cancer. Results from a Phase 1/1b clinical trial in over 350 cancer patients demonstrated a good safety/tolerability profile for AM0010 and sustained anti-tumor effects across several different cancer types, including pancreatic cancer, renal cell carcinoma, NSCLC and others. The U.S. Food and Drug Administration (FDA) and the European Commission (EC) have granted AM0010 Orphan Drug designation for the treatment of pancreatic cancer. AM0010 has also been granted Fast Track designation by the FDA in combination with FOLFOX as second-line therapy in patients with pancreatic cancer.

575 Chesapeake Drive, Redwood City, CA 94063


About ARMO BioSciences

ARMO BioSciences is a late-stage immuno-oncology company that is developing a pipeline of novel, proprietary product candidates that activate the immune system of cancer patients to recognize and eradicate tumors. The Company’s lead product candidate, AM0010 (pegilodecakin, PEGylated Interleukin-10), has demonstrated clinical benefit as a single agent, and in combination with both chemotherapy and checkpoint inhibitor therapy, across several tumor types. The drug is currently being investigated in a Phase 3 randomized pivotal clinical trial in pancreatic cancer patients. ARMO also has a number of other immuno-oncology product candidates in various stages of pre-clinical development including: AM0001, an anti-PD-1 monoclonal antibody; AM0003, an anti-LAG-3 checkpoint inhibitor; AM0015, form of recombinant human Interleukin-15 (IL-15); and AM0012, a form of recombinant human Interleukin-12 (IL-12). For more information, please visit www.armobio.com.

Forward-Looking Statements

This release includes forward-looking statements. All statements other than statements of historical facts, including the statements about future clinical milestones of AM0010 or our other product candidates, the indications we intend to pursue and our possible clinical or other business strategies, are forward-looking statements. Forward-looking statements can be identified by terms such as “believes,” “expects,” “plans,” “potential,” “would” or similar expressions and the negative of those terms. These forward-looking statements are based on our management’s current beliefs and assumptions about future events and on information currently available to management.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These risks include, but are not limited to, risks and uncertainties related to: our limited operating history and historical losses, our liquidity to fund the development of AM0010 and our other product candidates through current and future milestones, our ability to raise additional funding to complete the development and any commercialization of our product candidates, our dependence on the success of our lead product candidate, AM0010, results from the clinical trials and pre-clinical studies of third parties working in immuno-oncology and our dependence on third parties in connection with our manufacturing, clinical trials and pre-clinical studies. Additional risks and uncertainties that could affect our future results are included in the section titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Form 10-K filed with the SEC on March 30, 2018, which is available on the SEC’s website at www.sec.gov and our website at ir.armobio.com. Additional information on potential risks will be made available in other filings that we make from time to time with the SEC. In addition, any forward-looking statements contained in this press release are based on assumptions that we believe to be reasonable as of this date. Except as required by law, we assume no obligation to update these forward-looking statements, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.

Contact:

ARMO BioSciences, Inc.

Herb Cross

Chief Financial Officer

+1-650-241-3993

ir@armobio.com

575 Chesapeake Drive, Redwood City, CA 94063


ARMO BioSciences, Inc.

Balance Sheets

(in thousands, except share and per share data)

 

     December 31,     December 31,  
     2017     2016  

Assets

    

Current assets:

    

Cash and cash equivalents

   $ 49,475     $ 26,737  

Prepaid expenses and other current assets

     2,574       178  

Restricted cash

     50       50  
  

 

 

   

 

 

 

Total current assets

     52,099       26,965  

Property and equipment, net

     250       429  

Other long-term assets

     3,843       507  
  

 

 

   

 

 

 

Total assets

   $ 56,192     $ 27,901  
  

 

 

   

 

 

 

Liabilities, Redeemable Convertible Preferred Stock and Stockholders’ Deficit

    

Current liabilities:

    

Accounts payable

   $ 5,764     $ 7,481  

Accrued liabilities

     5,714       1,995  

Deferred rent, short-term

     136       38  

Other current liabilities

     32       101  
  

 

 

   

 

 

 

Total current liabilities

     11,646       9,615  

Redeemable convertible preferred stock, $0.0001 par value

    

Shares authorized: 95,180,211 at December 31, 2017

    

Shares issued and outstanding: 20,211,087 at December 31, 2017; 14,733,837 at December 31, 2016

    

Liquidation preference: $177,474 at December 31, 2017; $109,836 at December 31, 2016

     177,077       109,587  

Stockholders’ equity (deficit):

    

Common stock, $0.0001 par value

    

Shares authorized: 118,000,000 at December 31, 2017

    

Shares issued and outstanding: 1,535,199 at December 31, 2017; 1,541,160 at December 31, 2016

     1       1  

Additional paid-in capital

     2,822       1,558  

Accumulated deficit

     (135,354     (92,860
  

 

 

   

 

 

 

Total stockholders’ equity (deficit)

     (132,531     (91,301
  

 

 

   

 

 

 

Total liabilities, redeemable convertible preferred stock and stockholders’ equity

   $ 56,192     $ 27,901  
  

 

 

   

 

 

 

575 Chesapeake Drive, Redwood City, CA 94063


ARMO BioSciences, Inc.

Consolidated Statements of Operations

(in thousands, except share and per share information)

 

     Year Ended December 31,  
     2017     2016  

Operating expenses:

    

Research and development

   $ 36,960     $ 29,194  

General and administrative

     5,711       4,567  
  

 

 

   

 

 

 

Total operating expenses

     42,671       33,761  
  

 

 

   

 

 

 

Loss from operations

     (42,671     (33,761

Interest income

     246       137  
  

 

 

   

 

 

 

Net loss and comprehensive loss

   $ (42,425   $ (33,624
  

 

 

   

 

 

 

Basic and diluted net loss per share

   $ (28.52   $ (26.25
  

 

 

   

 

 

 

Weighted average number of shares used to calculate basic and diluted net loss per share

     1,487,421       1,280,938  
  

 

 

   

 

 

 

ARMO BioSciences, Inc.

Stock Based Compensation Expense

(in thousands)

Total stock-based compensation expense included in the consolidated statements of operations is as follows:

 

     Year Ended December 31,  
     2017      2016  

Research and development

   $ 524      $ 365  

General and administrative

     609        534  
  

 

 

    

 

 

 

Total stock-based compensation expense

   $ 1,133      $ 899  
  

 

 

    

 

 

 

575 Chesapeake Drive, Redwood City, CA 94063