Kinnate Biopharma Inc. (NASDAQ:KNTE) is a clinical-stage precision oncology company focused on the discovery, design, and development of small molecule kinase inhibitors for difficult-to-treat, genomically defined cancers. The company's mission is to inspire hope for those battling cancer by expanding on the promise of targeted therapies.

Business Overview

Kinnate's Kinnate Discovery Engine, which starts with the identification of an unmet need among validated oncogenic drivers, utilizes the company's deep expertise in medicinal chemistry, structure-based design, and the tailored ecosystems of its partners to develop targeted therapies. The company focuses its discovery and development efforts on three patient populations: those with cancers that harbor known oncogenic drivers with no currently available targeted therapies, those with genomically well-characterized tumors that have intrinsic resistance to currently available treatments, and those whose tumors have acquired resistance over the course of therapy to currently available treatments.

In September 2023, Kinnate announced a strategic plan to prioritize its exarafenib combination with binimetinib, its c-MET inhibitor KIN-8741, and its discovery efforts around its CDK4 selective program. As part of this plan, the company has reduced its workforce by approximately 70% and is exploring strategic alternatives for its exarafenib monotherapy and KIN-3248 FGFR inhibitor programs.

Product Pipeline

Kinnate's lead product candidate is exarafenib, a Rapidly Accelerated Fibrosarcoma (RAF) inhibitor in development for the treatment of patients with lung cancer, melanoma, and other solid tumors that harbor B-Rapidly Accelerated Fibrosarcoma (BRAF) Class I, II, or III alterations. In the third quarter of 2023, the company announced additional dose exploration data for the combination of exarafenib and binimetinib, as well as updated clinical data for exarafenib monotherapy from the KN-8701 trial.

As of the September 11, 2023 data cutoff, the combination of exarafenib and binimetinib demonstrated significant pathway inhibition, as evidenced by reductions in phosphorylated extracellular signal-regulated kinase (pERK) and DUSP6 RNA expression in paired tissue biopsies. Additionally, substantial (>50%, up to 100%) reductions in circulating tumor DNA were observed in 70% of the combination-treated patients with NRAS mutant melanoma.

In the exarafenib monotherapy arm of the KN-8701 trial, a total of 107 patients were enrolled, with 71 patients receiving the expansion dose of 300 mg twice daily (bid). Among these patients, 3 achieved a partial response and 26 demonstrated stable disease as their best response. Out of 8 patients with Class II fusion-driven solid tumors who received exarafenib at 300 mg bid, 3 showed radiographic tumor reductions, 2 of the 6 efficacy-evaluable patients achieved confirmed partial responses, resulting in a 33% overall response rate, and the remaining 4 efficacy-evaluable patients achieved stable disease as their best response, yielding a 100% disease control rate.

Kinnate's second product candidate is KIN-3248, a Fibroblast Growth Factor Receptors (FGFR) inhibitor, designed for the treatment of patients with intrahepatic cholangiocarcinoma (ICC), urothelial carcinoma (UC), and other solid tumors. As of the September 11, 2023 data cutoff, a total of 54 patients were enrolled in the ongoing dose escalation trial for KIN-3248, spanning 6 different dose levels. Two partial responses were observed, with 1 confirmed partial response in a patient with pancreatic cancer who had not received prior treatment with an FGFR2 inhibitor.

Financials

For the nine months ended September 30, 2023, Kinnate reported a net loss of $95.6 million, compared to a net loss of $84.7 million for the same period in 2022. The company did not generate any revenue during these periods. Kinnate's operating cash flow for the nine months ended September 30, 2023 was -$82.7 million, and its free cash flow was also -$82.7 million.

As of September 30, 2023, Kinnate had cash and cash equivalents and short-term and long-term investments of $180.3 million. Based on the company's current operating plan, Kinnate believes that its existing cash and cash equivalents and short-term and long-term investments will be sufficient to fund its planned operating expenses and capital expenditure requirements through at least the next twelve months from the date the Quarterly Report on Form 10-Q was filed with the SEC.

Kinnate's research and development expenses for the nine months ended September 30, 2023 were $77.4 million, compared to $63.0 million for the same period in 2022, an increase of $14.4 million. The increase was primarily driven by an increase in external expenses for the company's RAF and FGFR programs due to increased activity and costs, including increased patient enrollment and site activation, as well as an increase in internal research and development expenses.

General and administrative expenses for the nine months ended September 30, 2023 were $22.5 million, compared to $22.9 million for the same period in 2022, a decrease of $0.4 million. The decrease was primarily a result of decreased expenses for consulting fees and business insurance.

In September 2023, Kinnate began implementing its Strategic Plan, which includes a workforce restructuring that resulted in a reduction of approximately 70% of the company's employees. The restructuring costs recorded during the three and nine months ended September 30, 2023 related to one-time employee termination benefits, including severance and employee-related costs provided to separated employees.

Risks and Challenges

Kinnate faces several risks and uncertainties, including the ability to successfully develop and commercialize its product candidates, the highly competitive nature of the pharmaceutical and biotechnology industries, the company's limited operating history, and the need for substantial additional capital to finance its operations. The company's ability to generate revenue and achieve profitability depends significantly on its ability to achieve its objectives relating to the discovery, development, and commercialization of its product candidates.

Conclusion

Overall, Kinnate Biopharma is navigating the complexities of precision oncology with a focus on its exarafenib combination with binimetinib, its c-MET inhibitor KIN-8741, and its CDK4 selective research program. The company's strategic plan and workforce restructuring aim to streamline its operations and prioritize its most promising development efforts, while exploring alternatives for its exarafenib monotherapy and KIN-3248 FGFR inhibitor programs. As Kinnate continues to advance its pipeline and address the challenges of the industry, investors will closely monitor the company's progress and ability to deliver on its mission of inspiring hope for those battling cancer.