Cyclacel Pharmaceuticals, Inc. (NASDAQ:CYCC) is a clinical-stage biopharmaceutical company focused on developing innovative cancer medicines based on cell cycle, transcriptional regulation, epigenetics, and mitosis control biology. The company's lead asset, fadraciclib, is an oral CDK2/9 inhibitor that has shown promising results in advanced solid tumors and lymphomas. Cyclacel's pipeline also includes plogosertib, a PLK1 inhibitor in clinical development for the treatment of various cancers.

Cyclacel's Precision Medicine Strategy with Fadraciclib

Cyclacel's precision medicine strategy with fadraciclib is centered on targeting patient populations with specific genetic alterations that may make them more responsive to the drug. The company is currently evaluating fadraciclib in a Phase 2 proof-of-concept study (CYC065-101) in patients with advanced solid tumors and lymphomas.

In the Phase 1 portion of the CYC065-101 study, fadraciclib was generally well-tolerated and demonstrated clinical activity in heavily pre-treated patients with several tumor types, including endometrial, lung, ovarian, pancreatic cancer, and T-cell lymphoma. Retrospective analysis suggested that this activity may be associated with alterations in the CDKN2A and/or CDKN2B tumor suppressor genes.

Based on these findings, Cyclacel has opened an enriched cohort (Cohort 8) in the Phase 2 part of the CYC065-101 study to prospectively evaluate fadraciclib in patients with advanced solid tumors harboring CDKN2A and/or CDKN2B genetic abnormalities. The company expects to report initial data from this cohort by the end of 2024.

Cyclacel has also opened a second cohort in the CYC065-101 study to evaluate fadraciclib in patients with T-cell lymphoma, following promising single-agent activity observed in this patient population during the Phase 1 portion of the study.

Plogosertib: Cyclacel's PLK1 Inhibitor in Clinical Development

In addition to fadraciclib, Cyclacel is also developing plogosertib, a PLK1 inhibitor, in a Phase 1/2 registration-directed study (CYC140-101) for the treatment of advanced solid tumors and lymphomas. The study is using a streamlined design to determine the recommended Phase 2 dose (RP2D) and then evaluate plogosertib in proof-of-concept cohorts targeting specific tumor types and biomarkers.

Fifteen patients have been treated with plogosertib across the initial dose escalation levels, with stable disease observed in pre-treated patients with gastrointestinal, lung, and ovarian cancers. Cyclacel is also developing a new, alternative salt formulation of plogosertib with improved bioavailability.

Financial and Operational Highlights

As of September 30, 2024, Cyclacel had cash and cash equivalents of $2.98 million, which the company estimates will fund its planned programs into the fourth quarter of 2024. The company used net cash of $6.63 million to fund its operating activities during the nine months ended September 30, 2024.

Research and development (R&D) expenses decreased by $9.86 million, from $15.64 million for the nine months ended September 30, 2023, to $5.78 million for the same period in 2024. This decrease was primarily due to reductions in manufacturing and non-clinical expenditures for both fadraciclib and plogosertib.

General and administrative (G&A) expenses decreased by $0.40 million, from $4.84 million for the nine months ended September 30, 2023, to $4.44 million for the same period in 2024, largely due to a reduction in stock-based compensation expense.

The company reported a net loss of $8.16 million for the nine months ended September 30, 2024, compared to a net loss of $17.28 million for the same period in 2023.

For the most recent fiscal year (2023), Cyclacel reported revenue of $420,000 and a net loss of $22,555,000. Operating cash flow for 2023 was negative $16,112,000, and free cash flow was negative $16,118,000.

In the most recent quarter (Q3 2024), the company reported revenue of $10,000, a decrease of 37.5% compared to Q3 2023, due to the completion of an investigator-sponsored study managed by Cedars-Sinai Medical Center. The net loss for Q3 2024 was $1,957,000, which decreased from Q3 2023 due to lower research and development expenses. Operating cash flow and free cash flow for Q3 2024 were both $3,560,366.

Liquidity and Capital Resources

As of December 31, 2023, Cyclacel's debt-to-equity ratio was 0.06. The company's current ratio and quick ratio as of September 30, 2024, were both 0.77, indicating potential short-term liquidity challenges. Cyclacel does not have any available credit lines.

Since its founding in 1996, Cyclacel has devoted significant efforts to research and development, clinical trials, intellectual property development, and recruitment of key personnel. The company reported no revenue from 2019 to 2021, reflecting its focus on clinical development during this period.

In 2020, Cyclacel secured $25.16 million in gross proceeds through a securities purchase agreement, which provided crucial funding for advancing its pipeline. The company reported its first revenue of $0.4 million in 2021, related to a collaboration agreement, although it continued to report net losses due to substantial R&D investments.

Cyclacel has faced typical challenges of clinical-stage biotechnology companies, including the need for continuous capital raising and the complexities of advancing drug candidates through clinical trials. The company has primarily relied on equity financing to fund its operations, supplemented by research and development tax credits, government grants, and limited product revenue.

In 2022, Cyclacel encountered a setback when its shelf registration statement expired, leading to potential rescission rights for certain shareholders. Despite this challenge, the company managed to secure additional funding through other financing activities, demonstrating its ability to navigate financial hurdles in pursuit of its clinical development goals.

Outlook and Potential Catalysts

Cyclacel expects that its research and development expenditures for the full year 2024 will decrease compared to 2023, as the company does not anticipate incurring further manufacturing or preclinical costs. Spending will be primarily focused on the ongoing clinical trials for fadraciclib and plogosertib.

Potential catalysts for Cyclacel in 2024 and beyond include:

1. Reporting interim data from the Phase 2 proof-of-concept cohort of the CYC065-101 study evaluating fadraciclib in patients with advanced solid tumors and lymphomas harboring CDKN2A and/or CDKN2B genetic abnormalities. The company expects to report initial results from around a dozen patients by the end of 2024.

2. Announcing updates on the Phase 1/2 CYC140-101 study of plogosertib in advanced solid tumors and lymphomas.

3. Securing additional funding or strategic partnerships to support the company's clinical development programs and operations.

The success criteria for the first part of the Fadra Phase 2 study is to see more than 2 responses in the initial 12-14 patients.

Risks and Challenges

Cyclacel faces several risks and challenges, including:

1. Uncertainty around the ability to obtain additional financing to fund its operations beyond the fourth quarter of 2024, as the company has reported a stockholders' equity deficit that is not in compliance with Nasdaq's listing requirements.

2. The inherent risks and uncertainties associated with the development of novel cancer therapies, including the potential for adverse events, clinical trial failures, and regulatory hurdles.

3. Competition from other companies developing therapies targeting similar pathways or patient populations.

4. Reliance on key personnel and the potential impact of any future departures or transitions.

5. Fluctuations in foreign exchange rates, as the company's research and development activities are primarily conducted in the United Kingdom.

6. Substantial doubt about its ability to continue as a going concern due to its history of losses, negative cash flows, and dependence on additional financing.

Product Segments and Clinical Progress

Cyclacel has two primary product segments: Transcriptional Regulation and Anti-mitotic.

Transcriptional Regulation Program: The company's primary focus has been on the development of its transcriptional regulation program, which is evaluating fadraciclib, a CDK2/9 inhibitor, in solid tumors and hematological malignancies. In the ongoing Phase 1/2 65-101 study, a total of 47 heavily pretreated patients have been dosed across eight dose levels so far. Fadraciclib was generally well-tolerated, with the most common treatment-related adverse events being nausea, vomiting, diarrhea, fatigue, and hyperglycemia. Two partial responses were reported in patients with T-cell lymphoma, and clinical benefit was also seen in patients with endometrial, ovarian, pancreatic, and squamous non-small cell lung cancers. The primary objectives of the Phase 1 dose escalation were to determine the maximum tolerated dose (MTD) and/or recommended Phase 2 dose (RP2D), while the Phase 2 proof-of-concept stage aims to evaluate the preliminary efficacy as measured by overall response rate. The Phase 2 part of the study is ongoing, with two cohorts enrolling patients with CDKN2A/B mutations or deletions, and T-cell lymphoma.

Anti-mitotic Program: Cyclacel is also evaluating plogosertib, a PLK1 inhibitor, in its open-label Phase 1/2 registration-directed study 140-101. This study initially seeks to determine the RP2D for single-agent oral plogosertib in a dose escalation stage, and then will evaluate the drug in up to seven mechanistically relevant cohorts, including patients with bladder, breast, colorectal, hepatocellular, biliary tract, and lung cancers, as well as lymphomas. Fifteen patients have been treated at the first five dose escalation levels with no dose-limiting toxicities observed, and stable disease has been seen in some pretreated patients.

Conclusion

Cyclacel Pharmaceuticals is a clinical-stage biopharmaceutical company with a focus on developing precision medicine approaches to address unmet needs in oncology. The company's lead asset, fadraciclib, has shown promising results in advanced solid tumors and lymphomas, particularly in patients with specific genetic alterations. Cyclacel's strategy of targeting patient populations with biomarker-defined characteristics aligns with the industry's growing emphasis on personalized cancer treatments.

While the company faces challenges related to its financial position and the inherent risks of drug development, Cyclacel's pipeline and ongoing clinical studies provide opportunities for potential value creation. The company operates solely in the United States and has not been involved in any significant scandals, short seller reports, or CEO departures.

Investors should closely monitor the company's progress with fadraciclib and plogosertib, as well as its ability to secure additional funding to support its development efforts. The expected data readouts from the Fadra Phase 2 study and the company's ability to meet its success criteria will be crucial in determining Cyclacel's future prospects and potential for advancing its innovative cancer therapies.