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Acrivon Therapeutics, Inc. (NASDAQ:ACRV): A Promising Precision Oncology Player Advancing Novel Drug Candidates
Published on September 24, 2024 | Ticker: ACRV

Acrivon Therapeutics, Inc. (NASDAQ:ACRV) is a clinical-stage biopharmaceutical company developing precision medicines that the company matches to patients whose tumors are predicted to be sensitive to each specific medicine by utilizing its proprietary, machine learning-enabled proteomics-based platform, AP3. The company is currently advancing its lead candidate, ACR-368, a selective small molecule inhibitor targeting CHK1 and CHK2, in a potentially registrational Phase 2 trial across multiple tumor types. Additionally, Acrivon is leveraging its AP3 platform to develop a pipeline of internally-discovered, co-crystallography-driven preclinical programs, including ACR-2316, a potent, selective WEE1/PKMYT1 inhibitor.

Acrivon was incorporated in March 2018 and is headquartered in Watertown, Massachusetts, with a subsidiary in Lund, Sweden. The company has devoted substantial resources since inception towards conducting discovery and research activities, organizing and staffing the company, business planning, acquiring and internally discovering drug candidates, establishing and protecting its intellectual property portfolio, and preparing for and conducting preclinical studies and clinical trials.

Financials

Acrivon has not yet generated any revenue from the commercialization of its drug candidates. The company has incurred significant operating losses since its inception, reporting a net loss of $60.4 million for the year ended December 31, 2023 and $16.5 million and $12.8 million for the three months ended March 31, 2024 and 2023, respectively. As of March 31, 2024, the company had an accumulated deficit of $132.9 million.

Acrivon has funded its operations primarily with proceeds from the sales of shares of its convertible preferred stock, the issuance of convertible notes, and its initial public offering (IPO) and concurrent private placement in November 2022. As of March 31, 2024, the company had $110.0 million in cash, cash equivalents and investments. Additionally, on April 8, 2024, Acrivon entered into a Private Investment in Public Equity (PIPE) securities purchase agreement, receiving $130.0 million in aggregate gross proceeds.

The company believes that its existing cash, cash equivalents and investments, together with the gross proceeds from the April 2024 PIPE, will enable it to fund its operating expenses and capital expenditure requirements into the second half of 2026. However, Acrivon will require additional capital to achieve its business objectives, as it expects to continue incurring significant expenses and operating losses over the next several years as it advances its drug candidates through clinical development and potentially seeks regulatory approvals and commercialization.

Business Overview

Acrivon's lead candidate, ACR-368, is a selective small molecule inhibitor targeting CHK1 and CHK2 with sub single-digit nM and single-digit nM potency, respectively. The company is currently evaluating ACR-368 in a potentially registrational Phase 2 trial across multiple solid tumor types, including locally advanced or metastatic, recurrent platinum-resistant ovarian cancer, endometrial adenocarcinoma, and urothelial cancer.

The ACR-368 OncoSignature test, Acrivon's proprietary companion diagnostic, has been extensively evaluated in preclinical studies, including two separate, blinded, prospectively-designed studies on pretreatment tumor biopsies collected from past third-party Phase 2 trials in patients with ovarian cancer treated with ACR-368. These studies provided evidence of robust enrichment of responders through Acrivon's method. In November 2023, the company announced initial clinical observations from the ongoing Phase 2 trial, which showed a favorable tolerability profile and preliminary evidence of clinical activity in OncoSignature-positive patients across all three tumor types treated with single agent ACR-368 at the recommended Phase 2 dose (RP2D).

In April 2024, Acrivon presented initial positive clinical data from the ongoing registrational-intent Phase 2 ACR-368 trials, which provided initial, prospective validation of the OncoSignature test's ability to identify ovarian and endometrial patients sensitive to ACR-368 monotherapy, with clear segregation of RECIST responders in the OncoSignature-positive versus OncoSignature-negative arms. Based on these results, ACR-368 was granted two Fast Track designations from the FDA in May 2023 for the investigation of ACR-368 monotherapy in platinum-resistant ovarian cancer and endometrial cancer patients identified by the OncoSignature test. Additionally, the ACR-368 OncoSignature test was granted Breakthrough Device Designation in November 2023 for the identification of ovarian cancer patients who may benefit from treatment with ACR-368.

In addition to ACR-368, Acrivon is leveraging its proprietary AP3 precision medicine platform to rationally design and develop internally-discovered, co-crystallography-driven preclinical stage pipeline programs. These include ACR-2316, a potent, selective WEE1/PKMYT1 inhibitor designed using AP3 for superior single-agent activity as demonstrated in preclinical studies against clinically relevant comparators. ACR-2316 is being rapidly advanced in IND-enabling studies, with an IND filing expected in Q3 2024 and the initiation of a clinical trial anticipated in Q4 2024.

Liquidity

As of March 31, 2024, Acrivon had $110.0 million in cash, cash equivalents and investments. The company believes this, combined with the $130.0 million in gross proceeds from the April 2024 PIPE, will fund its operating expenses and capital expenditure requirements into the second half of 2026.

However, Acrivon will require additional capital to achieve its business objectives, as it expects to continue incurring significant expenses and operating losses over the next several years. The company's net losses were $60.4 million for the year ended December 31, 2023, and $16.5 million and $12.8 million for the three months ended March 31, 2024 and 2023, respectively. Acrivon's operating cash flow was -$42.6 million and its free cash flow was -$43.9 million for the year ended December 31, 2023.

The company's ability to raise additional funds may be adversely impacted by potential worsening global economic conditions and disruptions to the credit and financial markets. If Acrivon is unable to raise capital as needed, this could have a negative impact on its financial condition and ability to pursue its business strategies.

Risks and Challenges

Acrivon faces several risks and challenges in the development and commercialization of its drug candidates. These include the inherent risks and uncertainties associated with preclinical and clinical development, the ability to successfully enroll patients in clinical trials, the potential for unfavorable results from clinical trials, the ability to obtain regulatory approvals, the ability to successfully commercialize any approved drug candidates, and the ability to protect and enforce the company's intellectual property position.

Additionally, Acrivon is an early-stage company with a limited operating history, and it may never achieve or maintain profitability. The company has incurred significant losses since inception and expects to continue incurring losses over the next several years as it advances its drug candidates through development and potentially seeks regulatory approvals and commercialization.

Conclusion

Acrivon Therapeutics is a promising precision oncology player with a differentiated approach to drug development and a pipeline of innovative drug candidates. The company's lead candidate, ACR-368, has shown promising initial clinical data and has received Fast Track and Breakthrough Device designations from the FDA. Additionally, Acrivon's internally-discovered preclinical program, ACR-2316, is rapidly advancing towards the clinic.

While the company faces the inherent risks and challenges associated with drug development, Acrivon's strong financial position, with $110.0 million in cash, cash equivalents and investments as of March 31, 2024, and the $130.0 million in gross proceeds from the recent PIPE, provide a solid foundation to support its ongoing and future development efforts. As Acrivon continues to execute on its strategic priorities, the company's progress will be closely watched by investors and the broader biopharmaceutical community.

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