Lyell Immunopharma Inc
For the period ended Jun 30, 2024. Filed Aug 7, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 7, 2024
LYEL$14.86-0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-06.
0001628280-24-020467
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-07.
0001628280-24-035617
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 134 previous paragraphs and 142 current paragraphs.
87 unchanged; 32 reworded; 21 added; 12 removed; 3 previous and 2 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
LYL797 - A ROR1 CAR T-cell product candidate enhanced with anti-exhaustion technology designed for improved tumor infiltration and tumor cell killing
Current report
Our hypothesis that T-cell exhaustion is a key barrier in the treatment of solid tumors is informed by a clinical study previously conducted at the Fred Hutchinson Cancer Center. In this study, autologous ROR1-targeted CAR T cells infused into patients with CLL underwent rapid expansion and retained T-cell effector function, leading to tumor cell clearance and clinical responses. However, when CAR T cells generated with the same method were infused into patients with solid tumors such as TNBC or NSCLC, these T cells often failed to expand adequately, rapidly upregulated cell surface markers of T-cell exhaustion and adopted a dysfunctional state.
Current report
We recently reported initial clinical and translational data from our ongoing Phase 1 trial, detailed below. We believe these initial clinical and translational data (1) demonstrated that T-cell exhaustion is a key barrier to cell therapy in solid tumors as elucidated by the Fred Hutch Cancer Center study, and (2) provided early validation of our in vivo preclinical models demonstrating that LYL797 ROR-1 CAR T cells reprogrammed with our c-Jun overexpression and Epi‑R anti-exhaustion technology enhanced tumor control resulting in prolonged survival as compared to control ROR1 CAR T cells without our technologies.
Current report
Based on initial clinical data that demonstrated dose-dependent anti-tumor activity, we expanded the Phase 1 trial to include patients with platinum-resistant ovarian and endometrial cancers, where it is estimated in the literature that approximately 50% of patients have tumors in both indications that express ROR1. Ovarian cancer is one of the leading causes of cancer deaths among women. In the United States, approximately 20,000 women will be newly diagnosed with ovarian cancer in 2024. Only about 20% of ovarian cancers are diagnosed at an early stage. Late‑stage diagnosis is due in part to the largely asymptomatic nature of early‑stage disease and a lack of effective screening methods, coupled with the tumor’s inherent aggressive biology. Only 30% of advanced stage ovarian cancer patients survive for five years after initial diagnosis. Endometrial cancer (cancer of the lining of the uterus) is the most prevalent gynecological cancer and the sixth most common malignancy worldwide. Its incidence has been increasing over the last decade and it is one of the few cancers with increasing mortality. In 2024 in the United States, approximately 68,000 women will be newly diagnosed with uterine cancer, which includes patients with endometrial cancers and uterine sarcomas that together account for approximately 10% of uterine cancers. Only 19% of advanced stage endometrial cancer patients survive for five years after initial diagnosis.
Current report
We also plan to submit an investigational new drug (IND) application to initiate a second Phase 1 clinical trial of LYL797 in relapsed/refractory multiple myeloma and CLL, where it is estimated in the literature that 60% and 95% of patients’ malignancies, respectively, express ROR1. While recent advances in the treatment of multiple myeloma, including CAR T-cell therapy, have improved the survival outcomes in patients, the disease is not curable, and the vast majority of patients with multiple myeloma eventually relapse or become resistant to treatment. Thus, new treatments with different targets and modalities are needed. In the United States, it is estimated that approximately 36,000 people will be newly diagnosed with multiple myeloma in 2024. CLL is a less common hematologic malignancy, with approximately 21,000 new cases in the United States annually. Although current treatments are effective in achieving remission, CLL remains incurable and similar to multiple myeloma, CLL is likely to relapse and require further line(s) of therapy.
Current report
We recently reported initial clinical and translational data from our ongoing Phase 1 trial:
Current report
◦The initial dataset of 20 treated patients included 16 patients with TNBC and four patients with NSCLC. All patients enrolled had relapsed/refractory metastatic disease with an average of six lines of prior therapies. Four dose levels, including two interim dose levels, have been explored to date: 50 x 106 cells, 100 x 106 cells, 150 x 106 cells and 300 x 106 cells. The efficacy evaluable subset included 16 patients, and the safety evaluable subset included 18 patients. The manufacturing success rate was 100%.
Current report
◦Of the five patients with TNBC treated with LYL797 at the 150 x 106 cell dose level, the highest dose level cleared when the data were reported, two patients had confirmed partial responses to Day 90, resulting in an objective response rate (ORR) of 40% (Figure 1). The clinical benefit rate (CBR), defined as a best response of stable disease, partial response or complete response, was dose-dependent with a 60% CBR at the 150 x 106 cell dose level and a 38% CBR across all four dose levels evaluated (Figure 2).
Current report
Figure 1: Best response of the target lesions for the 16 efficacy evaluable patients. The dark purple bars represent the target lesion tumor size reduction from baseline observed in patients treated at the 150 million cell dose level. Of the five patients with TNBC treated with LYL797 at this dose level, two patients had confirmed partial responses to Day 90, resulting in an ORR of 40%.
Current report
Figure 2: A pattern of dose-dependent clinical activity emerged when the data were plotted by dose and clinical benefit rate, defined as stable disease, partial response or complete response. In addition to having stable disease by imaging, several patients had additional observations of clinical benefit including weight gain, decreased pain and improved liver function tests.
Current report
◦The most frequently reported related adverse events of any grade were cytokine release syndrome (CRS) (61%), pneumonitis (22%) and headache (17%), as well as the expected cytopenia from lymphodepletion in all patients. The CRS was generally mild (Grade 1 or 2 only), characterized by fever and treated with tocilizumab and steroids. There were no reports of immune effector cell-associated neurotoxicity syndrome (ICANS) attributed to LYL797. The most frequently reported Grade> 3 related adverse events were pneumonitis (17%) and hypoxia (11%), as well as the expected cytopenia from lymphodepletion in 78% of patients. The index patient with pneumonitis had Grade 5 respiratory failure on Day 41. Subsequently, patients were treated aggressively at the first sign or symptom of pneumonitis with high‑dose steroids with good result. Each case of pneumonitis has occurred between days 4 and 10. The adverse event of Grade> 3 pneumonitis occurred only in patients with TNBC and lung metastases, resulting in the separation of dose escalation into two cohorts based upon lung involvement (lung primary, lung metastatic disease or pleural effusion). No dose-limiting toxicities occurred in patients without lung involvement. All patients are now receiving prophylactic therapy with dexamethasone to mitigate pneumonitis.
Current report
◦Translational data were reported on a subset of patients and include CAR T-cell expansion in peripheral blood, phenotypic analysis of T-cell exhaustion and stem-like markers, and on-study tumor biopsies to assess for CAR T-cell tumor infiltration. LYL797 CAR T-cell expansion was observed in peripheral blood samples at Day 60 in all patients assessed when the data were reported (n = 11), with peak expansion occurring between Days 8 and 11. Peak expansion was on average three-fold higher in patients receiving 150 x 106 cells compared to those receiving 50 x 106 cells. The exhaustion marker, TIGIT, was found only in a low proportion of LYL797 CAR T cells at Day 11 (n = 4) providing support for the role of c-Jun overexpression as an anti-exhaustion technology. A significant proportion of cells with stem-like and effector memory phenotypes were demonstrated at Days 11 and 22 following RNAseq transcriptomic analysis, supporting the role of Epi-R to preserve a stem-like phenotype. Nine evaluable on-treatment tumor biopsies collected between Days 21 and 30 after LYL797 infusion were assessed. LYL797 CAR T cells were present in all solid-tumor biopsies, indicating that LYL797 CAR T cells enhanced with our anti-exhaustion technology were able to infiltrate and persist in the solid tumor microenvironment. In addition, the tumor biopsies have features consistent with T cell-mediated tumor lysis, including T cell-rich inflammation with scattered tumor cells.
Current report
•Updated data from the ongoing Phase 1 trial in solid tumor indications, including the initiation of dose expansion, are expected in late 2024 to early 2025.
Current report
•An IND is expected to be filed in the second half of 2024 to initiate a Phase 1 trial of LYL797 in patients with relapsed/refractory multiple myeloma or CLL.
Current report
•An IND application for LYL119 was cleared by the FDA.
Current report
•The Phase 1 trial is designed as an open label dose escalation and expansion trial in patients with ROR1 positive solid tumors and will initially enroll patients with ROR1 positive platinum-resistant ovarian cancer or endometrial cancer. Initial clinical data are expected in the second half of 2025.
Current report
Other (expense) income, net
Current report
Three and Six Months Ended June 30, 2024 and 2023
Current report
Research and development expenses were $83.4 million and $92.1 million for the six months ended June 30, 2024 and 2023, respectively. The $8.7 million decrease was primarily due to a $9.4 million reduction in personnel-related expenses mainly due to a decrease in headcount associated with the Company’s November 2023 reduction in workforce; a decrease of $1.9 million in facilities and technology costs primarily driven by the reduction in workforce and lower software implementation costs; and a decrease of $0.3 million associated with our success payment liabilities primarily driven by the change in our stock price. These decreases were partially offset by an increase of $2.9 million in research activities, collaborations and outside services primarily driven by clinical trials activity.
Current report
Other operating income, net was $1.0 million and $0.6 million for the three months ended June 30, 2024 and 2023, respectively, and $2.1 million and $1.9 million for the six months ended June 30, 2024 and 2023, respectively.
Current report
Other (expense) income, net
Removed paragraphs (12)
Previous report
Pipeline Programs and Operational Updates
Previous report
•An investigational new drug (IND) application for LYL119 is expected to be submitted in the first half of 2024.
Previous report
•Presented a poster with new nonclinical data on LYL119 at the American Association for Cancer Research (AACR) Annual Meeting 2024. In this study, LYL119, compared to ROR1 CAR T cells reprogramed with only two or three technologies, demonstrated reduced CAR T‑cell exhaustion, enhanced CAR T‑cell function, enhanced proliferation capacity and sustained antitumor activity in a mouse xenograft tumor model across a 10-fold dose range, including at very low cell doses. In addition, following repeated rounds of tumor cell killing, LYL119, displayed reduced expression of exhaustion-related gene signatures and retained unique cell subsets characterized by upregulation of memory and effector-associated gene signatures.
Previous report
Rejuvenation – Novel partial reprogramming technology designed to maintain T-cell identity while reducing cells’ epigenetic age
Previous report
We and others have documented the impact of aging on T‑cell function, which begins to decline after puberty, and at an increasingly accelerated rate after age 65. Morbidity and mortality from cancer also increase with age. Thus, we are working to advance another novel reprogramming technology that focuses on rejuvenation of antitumor T cells. We are developing a method designed to maintain T‑cell identity while reducing the epigenetic age of the cells. This technology is currently in the research stage. We have generated data illustrating the ability to “turn back” the epigenetic clock in a process called cellular rejuvenation, without changing the T‑cell’s identity as would occur in the setting of induced pluripotent stem cell-derived T cells.
Previous report
•Delivered an oral presentation at AACR highlighting new nonclinical data showing TIL rejuvenated with Lyell’s technology retain a broad T-cell receptor repertoire and demonstrate sustained proliferation and improved antitumor activities in vivo.
Previous report
Tumor-restricted IL-12 (trIL-12): A novel technology designed to enable potent IL-12 stimulation at the tumor site while avoiding systemic exposure
Previous report
IL-12 is an immune-stimulatory cytokine that can induce potent anti-tumor activity. This novel technology is designed to enable T cells to secrete trIL-12 upon encountering a tumor antigen, generating a favorable local proinflammatory immune response in the tumor microenvironment. trIL-12 rapidly auto-inactivates within minutes after secretion, thereby limiting systemic exposure. The technology was designed leveraging Outpace’s OUTSMART™ technology and is being advanced under a collaboration between Lyell and Outpace.
Previous report
•Presented a poster presentation at AACR highlighting nonclinical data demonstrating the ability of trIL-12 technology to deliver potent IL-12 stimulation at the tumor site while avoiding systemic exposure.
Previous report
Other Income, Net
Previous report
Other operating income, net was $1.1 million and $1.3 million for the three months ended March 31, 2024 and 2023, respectively.
Previous report
Other Income, Net
Reworded paragraphs (32)
Previous wording
We are a clinical-stage cell therapy company advancing a pipeline of product candidates for patients with solid tumors utilizing our proprietary ex vivo genetic and epigenetic T‑cell reprogramming technologies. Our investigational therapies use the patient’s own cells as the starting point to generate highly tumor-reactive, longer-lasting functional T cells with enhanced ability to defeat solid tumors. Our innovative reprogramming technologies address what we believe are the primary barriers that limit consistent and long-lasting responses to T‑cell therapy in solid tumors: T‑cell exhaustion and lack of durable stemness. Our technologies are designed to generate T cells with the ability to persist and self‑renew while driving durable tumor cytotoxicity, even in the setting of an immunosuppressive tumor microenvironment. We apply our technologies with the aim of developing T‑cell therapies with improved and durable antitumor responses for patients with solid tumors. Our technologies can be applied in a target agnostic manner to multiple T‑cell modalities, including chimeric antigen receptor (CAR), tumor-infiltrating lymphocytes (TIL) and T‑cell receptor (TCR) therapies.
Current wording
We are a clinical-stage cell therapy company advancing a pipeline of product candidates enhanced with our proprietary anti-exhaustion technologies for patients with solid tumors or hematologic malignancies. Our investigational therapies use the patient’s own cells as the starting point to generate highly tumor-reactive, longer-lasting functional T cells with enhanced ability to resist exhaustion and kill cancer cells. Our innovative genetic and epigenetic reprogramming technologies address what we believe are the primary barriers that limit consistent and long-lasting responses to T‑cell therapy in solid tumors: T‑cell exhaustion and lack of durable stemness. Our technologies are designed to generate T cells with the ability to persist and self‑renew while driving durable tumor cytotoxicity, even in the setting of an immunosuppressive tumor microenvironment. We apply our technologies with the aim of developing T‑cell therapies with improved and durable antitumor responses for patients. Our technologies can be applied in a target agnostic manner to multiple T‑cell modalities, including chimeric antigen receptor (CAR), tumor-infiltrating lymphocytes (TIL) and T‑cell receptor (TCR) therapies.
Previous wording
Our growing pipeline of promising cell product candidates targets solid tumor indications with large unmet needs that are collectively responsible for approximately 180,000 deaths in the United States annually. Each of our programs provide opportunities to expand into additional indications beyond the patient populations we are initially targeting. Our lead product candidates are summarized in Table 1 below:
Current wording
Our growing pipeline of promising cell product candidates target indications with large unmet needs that are collectively responsible for approximately 224,000 deaths in the United States annually. Our programs provide opportunities to expand into additional indications beyond the patient populations we are targeting. Our lead product candidates are summarized in Table 1 below:
Previous wording
We were incorporated in June 2018. Our primary activities to date have included clinical development of T-cell therapies, conducting research and development, acquiring technology, entering into strategic collaboration and license agreements, enabling and executing manufacturing activities in support of our product candidate development efforts, organizing and staffing our company, business planning, establishing our intellectual property portfolio, making regulatory submissions, executing clinical trials, raising capital and providing general and administrative support for these activities. We are early in our research and development efforts and are in Phase 1 clinical development of LYL797, our ROR1‑targeted CAR T‑cell product candidate, and LYL845, our TIL product candidate. Two additional product candidates that each include novel genetic and epigenetic reprogramming technologies are in preclinical development: LYL119, a ROR1‑targeted CAR T-cell product candidate and a second generation TIL product candidate. We do not have any products approved for sale.
Current wording
We were incorporated in June 2018. Our primary activities to date have included clinical development of T‑cell therapies, conducting research and development, acquiring technology, entering into strategic collaboration and license agreements, enabling and executing manufacturing activities in support of our product candidate development efforts, organizing and staffing our company, business planning, establishing our intellectual property portfolio, making regulatory submissions, executing clinical trials, raising capital and providing general and administrative support for these activities. We are early in our research and development efforts. LYL797, our ROR1‑targeted CAR T‑cell product candidate, is in Phase 1 clinical development for multiple solid tumor indications, and we expect to initiate a second Phase 1 clinical trial of LYL797 for hematologic indications in the second half of 2024. LYL119, our next generation ROR1‑targeted CAR T‑cell product candidate, is entering Phase 1 clinical trial in patients with solid tumors in the second half of 2024; and LYL845, our TIL product candidate, is in Phase 1 clinical development. A second generation TIL product candidate enhanced with novel genetic and epigenetic reprogramming technologies is in preclinical development. We do not have any products approved for sale.
Previous wording
We are advancing four wholly-owned product candidates. Two product candidates, LYL797 and LYL845 are in Phase 1 clinical development. Two additional product candidates, LYL119 and a second-generation TIL product candidate, are in preclinical development. Research stage programs include our proprietary T-cell rejuvenation technology and a tumor-restricted interleukin (IL)-12 technology designed to generate a local proinflammatory immune response in the tumor microenvironment.
Current wording
We are advancing four wholly-owned product candidates. Two product candidates, LYL797 and LYL845, are in Phase 1 clinical development, and an additional product candidate, LYL119, is entering Phase 1 clinical development. A second-generation TIL product candidate is in preclinical development. Research stage programs include our proprietary T‑cell rejuvenation technology and other undisclosed T‑cell enhancing technologies.
Previous wording
We are applying our c-Jun and Epi‑R technologies to our lead CAR T‑cell product candidate, LYL797, which is expected to be an intravenously‑administered CAR T‑cell product targeting the receptor tyrosine kinase-like orphan receptor 1 (ROR1) protein. ROR1 is a fetal protein expressed during embryogenesis and is believed to be important in cell migration, polarity and survival. It is expressed in several cancer types, including triple-negative breast cancer (TNBC), non-small cell lung cancer (NSCLC), ovarian cancer and chronic lymphocytic leukemia, and is generally associated with a poor prognosis. LYL797 contains a CAR with a 4-1BB/CD3ζ intracellular domain, a transmembrane domain, an optimized spacer domain and a single-chain variable fragment (scFv) derived from an R12 rabbit monoclonal antibody that recognizes and binds with high specificity to human ROR1. LYL797 also incorporates c-Jun and a proprietary optimized truncated version of human EGFR (EGFRopt) used for tracking the CAR T cells in the peripheral blood post treatment and can also be used as a safety measure with the administration of cetuximab, if needed. LYL797 is manufactured utilizing Epi‑R, our proprietary ex vivo manufacturing protocol that is designed to generate populations of T cells with stem-like qualities, reduced exhaustion and improved proliferation and antitumor activity.
Current wording
We are applying our c-Jun and Epi‑R technologies to our lead CAR T‑cell product candidate, LYL797, which is an intravenously‑administered autologous CAR T‑cell investigational product targeting the receptor tyrosine kinase-like orphan receptor 1 (ROR1) protein. ROR1 is a fetal protein expressed during embryogenesis and is believed to be important in cell migration, polarity and survival. It is expressed in several cancer types, including triple-negative breast cancer (TNBC), non-small cell lung cancer (NSCLC), ovarian cancer, endometrial cancer, multiple myeloma and chronic lymphocytic leukemia (CLL), and is generally associated with a poor prognosis. LYL797 contains a CAR with a 4‑1BB/CD3ζ intracellular domain, a transmembrane domain, an optimized spacer domain and a single-chain variable fragment (scFv) derived from an R12 rabbit monoclonal antibody that recognizes and binds with high specificity to human ROR1. LYL797 also incorporates c-Jun and a proprietary optimized truncated version of human EGFR (EGFRopt) used for tracking the CAR T cells in the peripheral blood post treatment and can also be used as a safety measure with the administration of cetuximab, if needed. LYL797 is manufactured utilizing Epi‑R, our proprietary ex vivo manufacturing protocol that is designed to generate populations of T cells with stem-like qualities, reduced exhaustion and improved proliferation and antitumor activity.
Previous wording
We are initially developing LYL797 for the treatment of ROR1-positive TNBC and NSCLC. Significant subsets of patients with common cancers express ROR1, including TNBC and NSCLC, two of the highest ROR1‑expressing solid tumor indications. Results from our own ROR1 screening program are consistent with what is reported in the literature. Using our immunohistochemistry assay in the screening for our Phase 1 trial, as of September 2023, we have found that approximately 50% of patients with TNBC and approximately 33% of patients with NSCLC have tumors that express ROR1. If successful, we may expand into other ROR1-positive cancers, including potentially ovarian and other solid tumors.
Current wording
Significant subsets of patients with common cancers express ROR1. We initiated development of LYL797 for the treatment of ROR1-positive TNBC and NSCLC, two of the highest ROR1‑expressing solid tumor indications. Results from our own ROR1 screening program are consistent with what is reported in the literature. Using our immunohistochemistry assay in the screening for our Phase 1 trial, as of June 2024, we have found that approximately 50% of patients with TNBC and approximately 35% of patients with NSCLC have tumors that express ROR1.
Previous wording
•Enrollment in the Phase 1 clinical trial of LYL797 is ongoing. The study includes patients with relapsed or refractory TNBC or NSCLC.
Current wording
•Enrollment in the Phase 1 clinical trial of LYL797 is ongoing. The study was initiated in patients with relapsed/refractory TNBC or NSCLC and expanded to include patients with platinum-resistant ovarian or endometrial cancers.
Previous wording
•The Phase 1 clinical trial is designed as an open label, dose escalation and expansion trial in patients with relapsed/refractory TNBC who have failed at least two lines of therapy and patients with relapsed/refractory NSCLC who have failed at least one line of therapy. All patients enrolled have tumor specimens positive for ROR1 protein expression by immunohistochemistry. The study will enroll at least 15 patients each with relapsed or refractory TNBC or with NSCLC in the expansion phase of the study.
Current wording
•The Phase 1 clinical trial is designed as an open-label, dose-escalation and -expansion trial in patients with relapsed/refractory TNBC or NSCLC and has been expanded to include patients with platinum-resistant ovarian or endometrial cancer. All patients enrolled have tumor specimens positive for ROR1 protein expression by immunohistochemistry. The expansion phase of the trial will enroll at least 15 patients with at least two tumor types.
Previous wording
•Initial data from at least 20 patients from the Phase 1 clinical trial of LYL797 are expected in the first half of 2024.
Current wording
•Initial data from the Phase 1 clinical trial of LYL797 were reported in June 2024:
Previous wording
•Enrollment in the Phase 1 clinical trial for LYL845 is ongoing. The study includes patients with relapsed or refractory metastatic or locally advanced melanoma, NSCLC and CRC.
Current wording
•Enrollment in the Phase 1 clinical trial for LYL845 is ongoing. The study is designed to include patients with relapsed or refractory metastatic or locally advanced melanoma, NSCLC and CRC.
Previous wording
•The Phase 1 clinical trial is designed as an open label, dose escalation and expansion trial in patients with relapsed or refractory metastatic or locally advanced melanoma, NSCLC and CRC. The study will enroll at least 15 patients each with advanced melanoma, and relapsed or refractory NSCLC or CRC in the expansion phase of the study.
Current wording
•The Phase 1 clinical trial is an open-label, dose-escalation and -expansion trial in patients with relapsed or refractory metastatic or locally advanced melanoma, NSCLC and CRC. The study will enroll at least 15 patients each with advanced melanoma, and relapsed or refractory NSCLC or CRC in the expansion phase of the study.
Previous wording
•Initial clinical and translational data from the Phase 1 trial of LYL845 are expected in the second half of 2024.
Current wording
•Initial clinical and translational data from the Phase 1 trial of LYL845 in patients with advanced melanoma are expected in the second half of 2024.
Previous wording
LYL119 - A ROR1-targeted CAR T-cell product candidate incorporating Lyell’s four stackable and complementary reprogramming technologies designed for enhanced cytotoxicity
Current wording
LYL119 - A next-generation ROR1-targeted CAR T-cell product candidate incorporating Lyell’s four stackable and complementary anti-exhaustion technologies designed for enhanced potency
Previous wording
A key pillar of our strategy is to continually innovate to develop and advance novel, breakthrough technologies that address key barriers to effective cell therapy for solid tumors. We have advanced a new genetic reprogramming technology, NR4A3 knockout, and a new epigenetic reprogramming technology, Stim‑R, that are being applied in our new CAR T-cell product candidate, LYL119. These technologies are stackable and complementary to c-Jun and Epi‑R and are designed to further improve the antitumor potency and durability of T cells.
Current wording
A key pillar of our strategy is to continually innovate to develop and advance novel, breakthrough technologies that address key barriers to effective cell therapy for solid tumors. We have advanced a new genetic reprogramming technology, NR4A3 knockout, and a new epigenetic reprogramming technology, Stim‑R, that are being applied in our new CAR T-cell product candidate, LYL119. These technologies are stackable and complementary to c-Jun and Epi‑R and are designed to enable T cells to further resist exhaustion and to improve antitumor potency and durability.
Previous wording
We are currently producing clinical supply for our Phase 1 trials at our LyFE Manufacturing Center. At full staffing and capacity, we expect to be able to manufacture approximately 500 infusions per year depending on product candidate mix. While we believe this capacity is sufficient to support our pipeline programs into pivotal trials and, if approved, early commercialization, we are also advancing multiple strategic alternatives to innovate and scale manufacturing in the future. We are evaluating third-party manufacturing options, such as the recently initiated CAR T-cell proof-of-concept collaboration with Cellares, as part of an overall CAR T‑cell manufacturing strategy to build scale and reduce cost. For TIL, we are advancing our Epi-R P2 manufacturing protocol to shorten delivery time of TIL product to patients.
Current wording
We are currently producing clinical supply for our Phase 1 trials at our LyFE Manufacturing Center. At full staffing and capacity, we expect to be able to manufacture approximately 500 infusions per year depending on product candidate mix. While we believe this capacity is sufficient to support our pipeline programs into pivotal trials and, if approved, early commercialization, we are also advancing multiple strategic alternatives to innovate and scale manufacturing in the future. We are evaluating third-party manufacturing options as part of an overall CAR T‑cell manufacturing strategy to build scale and reduce cost. For TIL, we are advancing our Epi-R P2 manufacturing protocol to shorten delivery time of TIL product to patients.
Previous wording
Our business and operations may be affected by worldwide economic conditions, which may continue to be impacted by global macroeconomic challenges such as the effects of the ongoing geopolitical conflicts in Ukraine, armed conflicts and turmoil in the Middle East, tensions in U.S.-China relations, inflationary pressures, fluctuations in the interest rate environment, instability in the banking industry, supply constraints and overall market volatility. Economic uncertainty may persist in 2024, and the market dynamics discussed above and similar adverse conditions may negatively impact our business.
Current wording
Our business and operations may be affected by worldwide economic conditions, which may continue to be impacted by global macroeconomic challenges such as the effects of the ongoing geopolitical conflicts in Ukraine, armed conflicts and turmoil in the Middle East, tensions in U.S.-China relations, inflationary pressures, fluctuations in the interest rate environment, instability in the banking industry, supply constraints and overall market volatility. Economic uncertainty may persist into the remainder of 2024, and the market dynamics discussed above and similar adverse conditions may negatively impact our business.
Previous wording
Research and development expenses also include non-cash expenses related to the change in the estimated fair value of the success payment obligations over their respective requisite service terms granted to Fred Hutchinson Cancer Center (Fred Hutch) and The Board of Trustees of the Leland Stanford Junior University (Stanford). As of December 31, 2022, Fred Hutch had provided the requisite service obligation to earn the potential success payment consideration under the continued collaboration. For the three months ended March 31, 2023 and future periods, the change in the Fred Hutch success payment liability fair value is recognized in other income, net, as the requisite service obligation had been met. See Note 3, License, Collaboration and Success Payment Agreements, in the accompanying notes to the unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10‑Q. Research and development expenses related to our success payment liabilities are unpredictable and may vary significantly from quarter‑to‑quarter and year‑to‑year due to changes in our assumptions used in the calculation.
Current wording
Research and development expenses also include non-cash expenses related to the change in the estimated fair value of the success payment obligations over their respective requisite service terms granted to Fred Hutchinson Cancer Center (Fred Hutch) and The Board of Trustees of the Leland Stanford Junior University (Stanford). As of December 31, 2022, Fred Hutch had provided the requisite service obligation to earn the potential success payment consideration under the continued collaboration. For the three and six months ended June 30, 2023 and future periods, the change in the Fred Hutch success payment liability fair value is recognized in other (expense) income, net, as the requisite service obligation had been met. See Note 3, License, Collaboration and Success Payment Agreements, in the accompanying notes to the unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10‑Q. Research and development expenses related to our success payment liabilities are unpredictable and may vary significantly from quarter‑to‑quarter and year‑to‑year due to changes in our assumptions used in the calculation.
Previous wording
Other operating income, net consists primarily of service and occupancy fees received associated with subleases.
Current wording
Other operating income, net consists primarily of service and occupancy fees received associated with subleases as well as losses on the retirement of property and equipment.
Previous wording
Other income, net consists primarily of the change in fair value associated with our success payment liabilities to Fred Hutch and adjustments to the fair value of our marketable equity securities that are publicly traded.
Current wording
Other (expense) income, net consists primarily of the change in fair value associated with our success payment liabilities to Fred Hutch and adjustments to the fair value of our marketable equity security that is publicly traded.
Previous wording
Research and development expenses were $43.2 million and $44.6 million for the three months ended March 31, 2024 and 2023, respectively. The decrease of $1.5 million was primarily due to a decrease of $3.2 million in personnel‑related expenses mainly due to a decrease in headcount associated with the Company’s November 2023 reduction in workforce; an increase of $1.1 million associated with our success payment liabilities primarily driven by the change in our stock price; an increase of $0.8 million in research activities, collaborations and outside services primarily driven by an increase in research and laboratory costs mainly due to clinical trials; and a decrease of $0.2 million in facilities and technology costs primarily related to lower software implementation costs.
Current wording
Research and development expenses were $40.3 million and $47.5 million for the three months ended June 30, 2024 and 2023, respectively. The $7.2 million decrease was primarily due to a $6.2 million reduction in personnel‑related expenses, mainly due to a decrease in headcount associated with the Company’s November 2023 reduction in workforce; a decrease of $1.7 million in facilities and technology costs primarily driven by the reduction in workforce and lower software implementation costs; and a decrease of $1.4 million associated with our success payment liabilities primarily driven by the change in our stock price. These decreases were partially offset by an increase of $2.0 million in research activities, collaborations and outside services primarily driven by clinical trials activity.
Previous wording
General and administrative expenses were $13.5 million and $19.3 million for the three months ended March 31, 2024 and 2023, respectively. The decrease of $5.8 million was primarily due to a decrease of $4.7 million in personnel costs, including a $3.9 million decrease in stock-based compensation expense, primarily related to significant awards being fully expensed in the previous periods and a decrease of $0.8 million in personnel‑related expenses mainly due to a decrease in headcount associated with the Company’s November 2023 reduction in workforce. General and administrative expenses also decreased due to a reduction of $0.7 million in other administrative expenses.
Current wording
General and administrative expenses were $25.8 million and $38.3 million for the six months ended June 30, 2024 and 2023, respectively. The $12.6 million decrease was primarily due to a $11.2 million reduction in personnel costs, including a $8.4 million decrease in stock-based compensation expense, primarily related to significant awards being fully expensed in the previous periods and a decrease of $2.8 million in personnel-related expenses mainly due to a decrease in headcount associated with the Company’s November 2023 reduction in workforce. General and administrative expenses also decreased due to a reduction of $1.2 million in other administrative expenses.
Previous wording
Interest income, net was $6.8 million and $4.5 million for the three months ended March 31, 2024 and 2023, respectively. The increase in interest income, net was primarily driven by higher interest rates in 2024.
Current wording
Interest income, net was $6.4 million and $5.3 million for the three months ended June 30, 2024 and 2023, respectively, and $13.2 million and $9.8 million for the six months ended June 30, 2024 and 2023, respectively. The increase in interest income, net was primarily driven by higher interest rates in 2024.
Previous wording
Other income, net was $1.1 million for both the three months ended March 31, 2024 and 2023. Other income, net consists primarily of the change in fair value associated with our success payment liabilities to Fred Hutch and for the three months ended March 31, 2024, adjustments to the fair value of our marketable equity securities investments that are publicly traded.
Current wording
Other (expense) income, net was $(0.6) million and $(0.3) million for the three months ended June 30, 2024 and 2023, respectively, and $0.4 million and $0.8 million for the six months ended June 30, 2024 and 2023, respectively. Other (expense) income, net consists primarily of the change in fair value associated with our success payment liabilities to Fred Hutch and for the three and six months ended June 30, 2024, adjustments to the fair value of our marketable equity security investment that is publicly traded.
Previous wording
Impairment of other investments was$13.0 million and $10.0 million for the three months ended March 31, 2024 and 2023, respectively, which consisted of the full impairment of one of our other investments in each period. See Note 5, Other Investments, in the accompanying notes to the unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10‑Q, for additional details regarding the impairments of other investments.
Current wording
Impairment of other investments waszero for the three months ended June 30, 2024 and $2.9 million for the three months ended June 30, 2023, which consisted of the full impairment of one of our other investments. Impairment of other investments was $13.0 million and $12.9 million for the six months ended June 30, 2024 and 2023, respectively, which consisted of the full impairment of one of our other investments for the six months ended June 30, 2024 and the full impairment of two of our other investments for the six months ended June 30, 2023. See Note 5, Other Investments, in the accompanying notes to the unaudited Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10‑Q, for additional details regarding the impairments of other investments.
Previous wording
As of March 31, 2024, we had $526.3 million in cash, cash equivalents and marketable securities. To date we have raised an aggregate of $1.4 billion in gross proceeds from sales of common stock and convertible preferred stock.
Current wording
As of June 30, 2024, we had $491.1 million in cash, cash equivalents and marketable securities. To date we have raised an aggregate of $1.4 billion in gross proceeds from sales of common stock and convertible preferred stock.
Previous wording
Until such time as we complete nonclinical and clinical development and receive regulatory approval of our product candidates and can generate significant revenue from product sales, if ever, we expect to finance our operations from the sale of additional equity or debt financings, or other capital that is generated from strategic collaborations, licensing or other arrangements. In the event that additional capital is required, we may not be able to raise it on terms acceptable to us, or at all. If we raise additional funds through the issuance of equity or convertible debt securities, including pursuant to the Sales Agreement, it may result in dilution to our existing stockholders. Debt financing or preferred equity financing, if available, may result in increased fixed payment obligations, and the existence of securities with rights that may be senior to those of our common stock. If we incur indebtedness, we could become subject to covenants that may restrict our operations. If we raise funds through strategic collaboration, licensing or other arrangements, we may relinquish significant rights or grant licenses on terms that are not favorable to us. Our ability to raise additional funds may be adversely impacted by potentially unfavorable global economic conditions and the recent disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from actual or perceived changes in interest rates and economic inflation, the anticipated impact of any geopolitical instability and otherwise. If we are unable to raise additional capital when desired, our business, results of operations and financial condition would be adversely affected.
Current wording
Until such time as we complete nonclinical and clinical development and receive regulatory approval of our product candidates and can generate significant revenue from product sales, if ever, we expect to finance our operations from the sale of additional equity or debt financings, or other capital that is generated from strategic collaborations, licensing or other arrangements. In the event that additional capital is required, we may not be able to raise it on terms acceptable to us, or at all. If we raise additional funds through the issuance of equity or convertible debt securities, including pursuant to the Sales Agreement, it may result in dilution to our existing stockholders. Debt financing or preferred equity financing, if available, may result in increased fixed payment obligations, and the existence of securities with rights that may be senior to those of our common stock. If we incur indebtedness, we could become subject to covenants that may restrict our operations. If we raise funds through strategic collaboration, licensing or other arrangements, we may relinquish significant rights or grant licenses on terms that are not favorable to us. Our ability to raise additional funds may be adversely impacted by potentially unfavorable global economic conditions and any disruptions to, and volatility in, the credit and financial markets in the United States and worldwide resulting from actual or perceived changes in interest rates and economic inflation, the anticipated impact of any geopolitical instability and otherwise. If we are unable to raise additional capital when desired, our business, results of operations and financial condition would be adversely affected.
Previous wording
During the three months ended March 31, 2024, net cash used in operating activities was $42.0 million, reflecting our net loss of $60.7 million, partially offset by non-cash items primarily related to the impairment of other investments of $13.0 million, stock-based compensation expense of $9.2 million and depreciation and amortization expense of $5.0 million. Non-cash net amortization and accretion on marketable securities of $4.4 million also contributed to net cash used in operating activities. Additionally, net operating assets and liabilities decreased $3.2 million primarily driven by a $3.6 million decrease in accrued liabilities and other current liabilities, partially offset by a $0.6 million increase in prepaid expenses, other current assets and other assets.
Current wording
During the six months ended June 30, 2024, net cash used in operating activities was $80.1 million, reflecting our net loss of $106.5 million, partially offset by $30.6 million of non-cash items primarily related to stock-based compensation expense of $17.4 million, the impairment of other investments of $13.0 million and depreciation and amortization expense of $9.9 million, partially offset by net amortization and accretion on marketable securities of $8.1 million and non-cash lease income of $1.0 million. Additionally, net operating assets and liabilities decreased $4.2 million primarily driven by a $3.1 million decrease in accrued liabilities and other current liabilities and a $0.6 million decrease in accounts payable.
Previous wording
During the three months ended March 31, 2023, net cash used in operating activities was $46.2 million, primarily reflecting our net loss of $67.0 million, partially offset by non-cash items mainly related to stock-based compensation expense of $13.9 million, impairment of other investments of $10.0 million and depreciation and amortization of $5.0 million, partially offset by net amortization and accretion on marketable securities of $1.9 million and the change in fair value of the success payment liabilities of $1.7 million. Additionally, net operating assets and liabilities decreased $4.3 million primarily driven by a $5.9 million decrease in accrued liabilities and other current liabilities partially offset by a $2.1 million increase in accounts payable.
Current wording
During the six months ended June 30, 2023, net cash used in operating activities was $85.4 million, primarily reflecting our net loss of $130.8 million, partially offset by $46.2 million of non-cash items primarily related to stock-based compensation expense of $28.1 million, impairment of other investments of $12.9 million and depreciation and amortization of $10.1 million, partially offset by net amortization and accretion on marketable securities of $3.9 million and non-cash lease income of $0.8 million. Additionally, net operating assets and liabilities decreased $0.7 million primarily driven by a $3.6 million decrease in accrued liabilities and other current liabilities partially offset by a $2.4 million increase in accounts payable.
Previous wording
During the three months ended March 31, 2024, cash provided by investing activities was $22.0 million, consisting of net maturities and purchases of marketable securities.
Current wording
During the six months ended June 30, 2024, cash provided by investing activities was $67.0 million, consisting primarily of net maturities and purchases of marketable securities.
Previous wording
During the three months ended March 31, 2023, cash provided by investing activities was $32.2 million, consisting of net maturities and purchases of marketable securities of $33.7 million offset by purchases of property and equipment of $1.5 million.
Current wording
During the six months ended June 30, 2023, cash provided by investing activities was $185.1 million, consisting of net maturities and purchases of marketable securities of $187.5 million offset by purchases of property and equipment of $2.5 million.
Previous wording
During the three months ended March 31, 2024, cash provided by financing activities was approximately zero as proceeds from the exercise of stock options of $0.1 million were offset by taxes paid related to the net share settlement of equity awards of $0.1 million.
Current wording
During the six months ended June 30, 2023, cash provided by financing activities was $1.1 million, consisting of proceeds from the employee stock purchase plan of $1.2 million and proceeds from the exercise of stock options of $0.1 million, partially offset by taxes paid related to the net share settlement of equity awards of $0.1 million.
Previous wording
Since our inception, we did not have, and we do not currently have, any off-balance sheet arrangements as defined under the applicable rules and regulations of the SEC.
Current wording
Since our inception, we have not had, and we do not currently have, any off-balance sheet arrangements as defined under the applicable rules and regulations of the SEC.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
General and administrative expenses were $12.3 million and $19.0 million for the three months ended June 30, 2024 and 2023, respectively. The $6.8 million decrease was primarily due to a $6.5 million reduction in personnel costs, including a $4.5 million decrease in stock-based compensation expense, primarily related to significant awards being fully expensed in the previous periods and a decrease of $2.0 million in personnel‑related expenses mainly due to a decrease in headcount associated with the Company’s November 2023 reduction in workforce.
Current report — wording carried from elsewhere
During the six months ended June 30, 2024, cash provided by financing activities was $0.9 million, consisting of proceeds from the employee stock purchase plan of $0.8 million and proceeds from the exercise of stock options of $0.2 million, partially offset by taxes paid related to the net share settlement of equity awards of $0.1 million.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
LYL797 - A ROR1-targeted CAR T-cell product candidate genetically reprogrammed to overexpress c-Jun and epigenetically reprogrammed using Lyell’s proprietary Epi-RTM manufacturing protocol designed for differentiated potency and durability
Previous report — wording carried elsewhere
Three Months Ended March 31, 2024 and 2023
Previous report — wording carried elsewhere
During the three months ended March 31, 2023, cash used in financing activities was $0.1 million, consisting of taxes paid related to the net share settlement of equity awards.