Centessa Pharmaceuticals plc (NASDAQ:CNTA) is a clinical-stage pharmaceutical company that is pioneering a differentiated asset-centric approach to drug discovery and development. With a diverse pipeline of high-conviction programs targeting areas of significant unmet medical need, Centessa is well-positioned to deliver transformational medicines to patients.

Business Overview

Centessa's most advanced pipeline programs include SerpinPC for the treatment of hemophilia, ORX750 for narcolepsy and other sleep-wake disorders, and LB101, a conditionally tetravalent PD-L1xCD47 bi-specific monoclonal antibody for solid tumors. These programs have demonstrated promising results in preclinical and early-stage clinical studies, and the company is making significant strides in advancing them towards regulatory approval.

Financials

In the fiscal year ended December 31, 2023, Centessa reported annual revenue of $6,879,562 and a net loss of $151,670,616. The company's annual operating cash flow was -$160,963,497, and its annual free cash flow was -$161,133,152. These financial results reflect Centessa's continued investment in its robust pipeline and the company's commitment to advancing its innovative therapies.

During the first quarter of 2024, Centessa reported a net loss of $38,046,000, with research and development expenses of $22,652,000 and general and administrative expenses of $13,438,000. The company's cash, cash equivalents, and short-term investments stood at $230,177,000 as of March 31, 2024, providing a solid financial foundation to support its ongoing development efforts.

Hemophilia Program: SerpinPC, a Potential Game-Changer

Centessa's lead product candidate, SerpinPC, is an investigational, potentially first-in-class subcutaneously administered novel inhibitor of activated protein C (APC) for the treatment of hemophilia. SerpinPC has a unique mechanism of action designed to prevent and reduce bleeds in individuals with hemophilia, a rare and debilitating genetic disorder characterized by the lack of certain blood-clotting proteins.

The company is currently evaluating SerpinPC in the PRESent registrational studies for hemophilia B (HB) with and without inhibitors. In July 2023, Centessa dosed the first subject in Part 1 of the registrational PRESent-2 study of moderately severe to severe HB without inhibitors, and severe hemophilia A (HA) with or without inhibitors. The company plans to review data from Part 1 of the study this year, with the goal of confirming a dose and advancing to Part 2 of the study. Thereafter, Centessa plans to share data from Part 1 at a medical conference in late 2024 or early 2025.

In parallel to the ongoing PRESent studies, Centessa continues to work with the U.S. Food and Drug Administration (FDA) and global regulators on its product process development and qualification activities. The company's streamlined, integrated development program is designed to support HB, with and without inhibitors, as the initial indication for SerpinPC. The FDA has granted SerpinPC Orphan Drug Designation in September 2022 and Fast Track designation in May 2023, both for the treatment of HB.

Orexin Receptor 2 (OX2R) Agonist Program: ORX750, a Promising Approach to Sleep-Wake Disorders

Centessa's ORX750 is an investigational, orally administered, selective OX2R agonist designed to directly target the underlying pathophysiology of orexin neuron loss in narcolepsy type 1 (NT1) and address sleep-wake disorders with normal orexin levels, such as narcolepsy type 2 (NT2) and idiopathic hypersomnia (IH).

In October 2023, the company shared a robust set of preclinical data which it believes support ORX750's potential as a best-in-class OX2R agonist for the treatment of NT1, NT2, and other sleep-wake disorders, including IH. Following the clearance of its Investigational New Drug (IND) application from the FDA in April 2024, Centessa recently initiated a Phase 1 first-in-human (FIH) clinical trial of ORX750 for the treatment of narcolepsy.

The Phase 1 study will evaluate the safety, tolerability, and pharmacokinetics (PK) of single-ascending doses (SAD) and multiple-ascending doses (MAD) of ORX750 in healthy adult subjects. In parallel to the SAD, a cross-over pharmacodynamic (PD) assessment will be performed utilizing the Maintenance of Wakefulness Test (MWT) and Karolinska Sleepiness Scale (KSS) in acutely sleep-deprived healthy adult subjects, which is intended to provide proof-of-concept (PoC) data to enable dose selection for NT1, NT2, and IH indications. Centessa expects to share PoC data in acutely sleep-deprived healthy volunteers in the second half of 2024.

LockBody® Technology Platform: Pioneering a Novel Approach to Solid Tumors

Leveraging its proprietary LockBody® technology, Centessa is pioneering a novel approach designed to selectively drive potent effector function activity, such as CD47 or CD3, into the tumor micro environment (TME) while avoiding systemic toxicity.

The company's first LockBody product candidate, LB101, is a conditionally tetravalent PD-L1xCD47 bi-specific monoclonal antibody. Following the clearance of its IND application from the FDA in January 2023, Centessa initiated a Phase 1/2a FIH, open-label, multicenter, dose escalation study with expansion cohorts to evaluate the safety, tolerability, and preliminary activity of LB101 in subjects with advanced solid tumors.

The study consists of two parts: FIH dose escalation and dose optimization (Part 1a and Part 1b, respectively) and dose expansion (Part 2). Part 1 will evaluate LB101 monotherapy in subjects with selected, advanced solid tumors and determine the recommended dose(s) for expansion for Part 2. The design of Part 2 depends on the results of Part 1 and will further evaluate the safety, efficacy, tolerability, PK, and immune response of LB101. This study is also expected to provide insights into the performance of Centessa's LockBody technology platform in a clinical setting.

Centessa dosed the first subject with LB101 in March 2023.

Liquidity

As of March 31, 2024, Centessa had $230,177,000 in cash, cash equivalents, and short-term investments. The company expects this cash position, combined with the net proceeds from its recent offering of ADSs in April 2024, to fund its operations into mid-2026 without drawing on the remaining available tranches under the Note Purchase Agreement with Oberland Capital.

Centessa has been actively managing its capital resources to support the advancement of its pipeline. In October 2021, the company entered into a financing agreement with Oberland Capital, which provides it with additional funds to further scale up its development activities and enhance its balance sheet flexibility for potential pipeline extension.

Furthermore, in January 2023, Centessa entered into an "at-the-market" (ATM) offering program, which allows the company to offer and sell up to $125.0 million of its ordinary shares represented by ADSs from time to time. As of March 31, 2024, the company had sold 4,290,816 ordinary shares under the ATM program, resulting in net proceeds of approximately $30.5 million.

Risks and Challenges

Centessa's business is subject to numerous risks and uncertainties, including the ability to successfully develop and commercialize its product candidates, the potential for a single or limited number of programs or product candidates to comprise a large proportion of the company's value, and the challenges associated with integrating the operations of its Centessa Subsidiaries.

The company also faces risks related to its financial position, including the need for substantial additional funding to advance its development programs and the potential impact of inflation on its costs. Additionally, Centessa may encounter delays or challenges in the initiation, conduct, or completion of its clinical trials, and the results of its clinical development efforts are uncertain.

Regulatory approval for Centessa's product candidates is also a significant risk, as the company may be unable to obtain U.S. or foreign regulatory approval, which would prevent it from commercializing its products. The company's reliance on third parties, such as contract research organizations and contract manufacturing organizations, also exposes it to risks related to the performance and reliability of these partners.

Centessa's intellectual property rights are also critical to its success, and the company faces risks related to its ability to obtain and maintain sufficient patent and other intellectual property protection for its product candidates and technology.

Outlook

Centessa Pharmaceuticals is a promising biotech company with a differentiated asset-centric approach to drug discovery and development. Its diverse pipeline of high-conviction programs, including SerpinPC for hemophilia, ORX750 for sleep-wake disorders, and LB101 for solid tumors, has demonstrated encouraging results in preclinical and early-stage clinical studies.

The company's strong financial position, with $230,177,000 in cash, cash equivalents, and short-term investments as of March 31, 2024, provides a solid foundation to support the advancement of its pipeline. Centessa's strategic partnerships and capital-raising initiatives, such as the Oberland Capital financing agreement and the ATM offering program, further bolster its ability to execute on its ambitious development plans.

Conclusion

While Centessa faces a range of risks and challenges common to the pharmaceutical industry, the company's innovative approach, experienced management team, and promising pipeline of product candidates position it well to deliver transformational medicines to patients in need. As Centessa continues to make progress in its clinical trials and regulatory efforts, investors will closely monitor the company's ability to navigate the complex landscape and capitalize on the significant market opportunities within its areas of focus.