Capricor Therapeutics, Inc. (NASDAQ:CAPR) is a clinical-stage biotechnology company at the forefront of developing transformative cell and exosome-based therapeutics for the treatment of rare diseases, with a primary focus on Duchenne muscular dystrophy (DMD). The company's lead product candidate, CAP-1002, is a cardiac-derived cell therapy that has demonstrated promising results in clinical trials for the treatment of DMD, a rare and devastating form of muscular dystrophy.
Business Overview
Capricor Therapeutics was founded in 2005 and has since been dedicated to advancing innovative therapies to address high unmet medical needs. The company's core focus is on the development of CAP-1002, an allogeneic cardiac-derived cell therapy, for the treatment of DMD. DMD is a rare genetic disorder characterized by progressive muscle degeneration and premature death, typically affecting young boys.CAP-1002 is designed to slow disease progression in DMD through its immunomodulatory, anti-inflammatory, and anti-fibrotic actions, which are mediated by secreted exosomes laden with bioactive cargo. The company's exosome-based platform technology, including its proprietary StealthX™ platform, also holds significant potential for the development of novel vaccines and targeted therapeutics for a variety of indications.
Capricor has made substantial progress in the clinical development of CAP-1002 for DMD. The company is currently conducting a Phase 3 clinical trial, known as HOPE-3, which is evaluating the safety and efficacy of CAP-1002 in late-stage ambulant and non-ambulant DMD patients. In the first quarter of 2024, Capricor announced the completion of enrollment for Cohort A of the HOPE-3 trial, which included 61 subjects randomized to receive either CAP-1002 or placebo. The company expects to report top-line data from Cohort A in the fourth quarter of 2024, which it intends to use to support a Biologics License Application (BLA) submission.
Regulatory Milestones and Partnerships
Capricor's regulatory pathway for CAP-1002 is supported by several key designations, including Regenerative Medicine Advanced Therapy (RMAT) and Orphan Drug designations. In addition, the company has entered into two Commercialization and Distribution Agreements with Nippon Shinyaku, a Japanese pharmaceutical company, appointing Nippon Shinyaku as the exclusive distributor of CAP-1002 in the United States and Japan.Under the terms of the U.S. Distribution Agreement, Capricor received an upfront payment of $30 million in the first quarter of 2022 and is eligible to receive up to $90 million in additional milestone payments leading up to and including BLA approval. Capricor will also have the right to receive a meaningful mid-range double-digit share of product revenue from Nippon Shinyaku. The company also entered into a separate Commercialization and Distribution Agreement with Nippon Shinyaku for the rights to CAP-1002 in Japan, which included an upfront payment of $12 million in the first quarter of 2023 and the potential for additional development and sales-based milestone payments of up to approximately $89 million.
Financial Performance and Liquidity
Capricor Therapeutics reported annual revenue of $25.2 million and a net loss of $22.3 million for the fiscal year ended December 31, 2023. The company's annual operating cash flow was negative $25.6 million, and its annual free cash flow was negative $27.6 million. As of March 31, 2024, Capricor had cash, cash equivalents, and marketable securities totaling approximately $39.9 million.In the first quarter of 2024, Capricor received a $10 million milestone payment from Nippon Shinyaku, which was triggered by the positive outcome of the interim futility analysis for Cohort A of the HOPE-3 trial. Additionally, the company raised approximately $3.5 million in gross proceeds through its at-the-market (ATM) offering program during the first quarter and through May 13, 2024. Based on the company's current operating plan and projections, Capricor expects its cash runway to extend into the first quarter of 2025, excluding any additional potential milestone payments from its agreements with Nippon Shinyaku.
Operational Highlights and Outlook
Capricor has made significant progress in advancing its CAP-1002 program for the treatment of DMD. In the first quarter of 2024, the company announced the completion of enrollment for Cohort A of the HOPE-3 Phase 3 clinical trial, which included 61 subjects randomized to receive either CAP-1002 or placebo. The company expects to report top-line data from Cohort A in the fourth quarter of 2024, which it plans to use to support a BLA submission.Additionally, Capricor has made important advancements in its manufacturing and regulatory strategy. The company's latest interaction with the FDA has allowed it to transition to its San Diego manufacturing facility for potential commercial production of CAP-1002, without the need for additional manufacturing site-specific clinical data. This represents a significant milestone, as it streamlines the path to BLA submission and potential approval.
Capricor is also actively preparing for the commercialization of CAP-1002, should it receive regulatory approval. The company has increased the frequency of its meetings with Nippon Shinyaku and its U.S. subsidiary, NS Pharma, to actively plan for the potential launch and commercial expansion of CAP-1002 in the United States. Capricor is also exploring opportunities for global growth and expansion, including active discussions with potential partners for the European rights to CAP-1002 for DMD.
Beyond its lead DMD program, Capricor continues to make progress with its exosome-based platform technology. The company's proprietary StealthX™ platform has shown promising preclinical results, including the development of an exosome-based multivalent vaccine for the prevention of SARS-CoV-2, which has been selected to be part of the U.S. government's Project NextGen initiative. Capricor is also exploring the therapeutic potential of its exosome platform, including the development of an exosome-based approach for the treatment of arginase-1 deficiency, a rare genetic metabolic disease.