Galectin Therapeutics is a clinical-stage biopharmaceutical company at the forefront of developing novel therapies that target galectin proteins, which play a crucial role in various diseases. The company's lead drug candidate, belapectin, is being investigated for the treatment of metabolic dysfunction-associated steatohepatitis (MASH) cirrhosis, a progressive liver disease with significant unmet medical needs.
Business Overview and History
Galectin Therapeutics was founded in July 2000 and was initially incorporated in the state of Nevada under the name Pro-Pharmaceuticals, Inc. In May 2011, the company changed its name to Galectin Therapeutics Inc. to reflect its focus on targeting galectin proteins, which are key mediators of biological and pathological functions.
The company's core expertise lies in leveraging its leadership in galectin science and drug development to create new therapies for fibrotic diseases, cancer, and other chronic health conditions. Galectin Therapeutics has developed a proprietary platform of complex carbohydrate molecules, which are formulated into pharmaceutical-grade compounds, such as its lead drug candidate, belapectin. These compounds are derived from naturally occurring, readily-available plant products, which undergo specific manufacturing processes to create patented complex carbohydrates with specific molecular weights and other pharmaceutical properties.
In January 2013, Galectin Therapeutics submitted an Investigational New Drug (IND) application to the FDA to initiate a Phase 1 study in patients with NASH and advanced liver fibrosis. The FDA allowed the company to proceed with the US Phase 1 clinical trial, which demonstrated that belapectin up to 8 mg/kg Lean Body Mass (LBM), administered intravenously, was safe and well tolerated.
The company's Phase 2 program in fibrotic disease consisted of two separate human clinical trials - the NASH-FX trial and the NASH-CX trial. While the NASH-FX trial did not meet its primary endpoint, it provided support for further development in NASH. The NASH-CX trial explored the use of belapectin for the treatment of patients with well-compensated NASH cirrhosis and portal hypertension.
Galectin Therapeutics has completed two Phase 1 clinical studies, a Phase 2 study in MASH patients with advanced fibrosis (NASH-FX), and a Phase 2b study in MASH patients with compensated cirrhosis and portal hypertension (NASH-CX). The results from the NASH-CX trial, reported in 2017, showed a favorable safety profile and clinically meaningful efficacy in patients without esophageal varices at baseline, as demonstrated by a decrease in portal pressure and a reduction in the development of new varices.
Building on the experience from the NASH-CX trial, Galectin Therapeutics initiated the NAVIGATE trial, a seamless, adaptive Phase 2b/3 study evaluating the safety and efficacy of belapectin for the prevention of esophageal varices in patients with MASH cirrhosis. The NAVIGATE trial was designed to assess the effect of belapectin on the incidence of new varices, as well as the incidence of additional clinically significant cirrhosis-related outcomes.
The company activated more than 150 clinical trial sites in 14 countries for the NAVIGATE trial. However, the COVID-19 pandemic caused delays in regulatory approvals, site recruitment, and patient enrollment. As the pandemic situation improved, the enrollment accelerated, and the last patient was randomized in February 2023. The company expects to report the top-line efficacy and safety results from the NAVIGATE trial in December 2024.
In addition to the NAVIGATE trial, Galectin Therapeutics has also completed a Hepatic Impairment Study, which evaluated the effects of belapectin in subjects with normal hepatic function and those with varying degrees of hepatic impairment. The results of this study, presented in 2023, indicated that belapectin exposure did not increase with the degree of hepatic insufficiency, a property that is consistent with the observed distribution of the drug into activated macrophages.
Galectin Therapeutics has also explored the potential of belapectin in the field of cancer immunotherapy. Preclinical studies have suggested that belapectin can enhance the immune system's function and help the body fight cancer when combined with immune checkpoint inhibitors, such as anti-CTLA-4 or anti-PD-1. Based on these promising results, the company has initiated a phase 2 trial evaluating belapectin in combination with a checkpoint inhibitor for the treatment of recurrent or metastatic head and neck cancer.
Financials
Galectin Therapeutics has financed its operations primarily through public and private offerings of debt and equity. As of September 30, 2024, the company had $27.1 million in unrestricted cash and cash equivalents. Additionally, on November 14, 2024, the company entered into a second supplemental unsecured $6 million line of credit financing with its chairman, Richard E. Uihlein.
For the nine months ended September 30, 2024, the company reported net cash used in operations of $28.98 million, compared to $28.26 million for the same period in 2023. The increase in cash used in operations was primarily due to the timing of expenses related to the NAVIGATE clinical trial.
The company's research and development expenses were $25.46 million for the nine months ended September 30, 2024, compared to $23.90 million for the same period in 2023. The increase was primarily attributable to the timing of clinical program expenditures related to the NAVIGATE trial.
General and administrative expenses were $4.54 million for the nine months ended September 30, 2024, compared to $4.61 million for the same period in 2023. The slight decrease was mainly due to a reduction in legal and investor relations expenses.
For the most recent fiscal year, Galectin Therapeutics reported no revenue, as the company is still in the clinical stage and focused on developing its drug candidates. The net loss for the year was $41,066,000, with operating cash flow (OCF) and free cash flow (FCF) both at -$32,965,000.
In the most recent quarter, the company again reported no revenue, with a net loss of $11,220,000. The quarterly OCF and FCF were both -$8,538,000. The decrease in net income, OCF, and FCF compared to the prior year's quarter was primarily due to increased research and development expenses related to the NAVIGATE clinical trial.
Liquidity
As of September 30, 2024, the company had a net tangible asset value of -$62.5 million and a working capital of $12.0 million. The company's total debt stood at $71.8 million, with $46.1 million in net debt. The debt-to-equity ratio was -1.13, indicating a highly leveraged financial position. The current ratio and quick ratio were both 1.13, suggesting that the company has just enough liquid assets to cover its short-term liabilities.
Galectin Therapeutics believes it has sufficient cash to fund currently planned operations, including the NAVIGATE trial, approximately through May 2025. However, the company will require additional financing beyond that timeframe to continue its operations and development programs.
Risks and Challenges
Galectin Therapeutics faces several risks and challenges in its pursuit of developing and commercializing its lead drug candidate, belapectin. These include:
1. Clinical Development Risks: The company's ability to successfully complete the NAVIGATE trial and obtain regulatory approvals for belapectin is crucial. Delays or setbacks in the clinical development process could have a significant impact on the company's operations and financial position.
2. Financing and Liquidity Risks: Galectin Therapeutics will likely need to raise additional capital to support its ongoing operations and clinical development programs. Failure to obtain sufficient financing could impede the company's ability to execute its strategic plans.
3. Competitive Landscape: The company operates in a highly competitive industry, and the development of new therapies for MASH cirrhosis and cancer immunotherapy may face competition from other pharmaceutical and biotechnology companies.
4. Regulatory Uncertainties: The company's success is dependent on obtaining regulatory approvals for its drug candidates, which can be a lengthy and unpredictable process. Changes in regulatory requirements or policies could adversely affect the company's development plans and timelines.
5. Reliance on Third-Party Vendors: Galectin Therapeutics relies on third-party vendors, such as contract research organizations and contract manufacturing organizations, to support its drug development and manufacturing activities. Disruptions or failures in these relationships could impact the company's operations.
6. Pandemic and Geopolitical Risks: The COVID-19 pandemic has already affected the company's clinical trials, and future pandemics or geopolitical tensions could introduce further delays and challenges.
Outlook and Conclusion
Galectin Therapeutics is well-positioned to address the significant unmet medical needs in MASH cirrhosis and cancer immunotherapy with its lead drug candidate, belapectin. The company's strategic focus on targeting galectin-3, a key mediator of fibrosis and immune function, has the potential to yield transformative therapies.
The upcoming top-line results from the NAVIGATE trial in December 2024 will be a crucial milestone for the company, as positive data could pave the way for regulatory approvals and potential partnerships. Additionally, the company's ongoing exploration of belapectin in cancer immunotherapy, particularly in the treatment of head and neck cancer, presents another promising avenue for value creation.
In the field of liver fibrosis and cirrhosis, belapectin has shown significant therapeutic effects in preclinical models, reducing liver fat, inflammation, portal pressure, and ballooning degeneration. The NASH-CX trial demonstrated a favorable safety profile and clinically meaningful efficacy results, particularly in patients without esophageal varices at baseline. These promising results have set the stage for the ongoing NAVIGATE trial, which is targeting NASH patients with compensated cirrhosis and clinical signs of portal hypertension.
In cancer immunotherapy, preclinical studies have indicated that belapectin enhances the immune response to cancer cells, increases tumor shrinkage, and enhances survival in animal models when combined with immune checkpoint inhibitors. Early clinical studies in metastatic melanoma and head and neck squamous cell carcinoma have reported promising results, with objective response rates of 50% and 33%, respectively, when belapectin was combined with pembrolizumab.
While Galectin Therapeutics faces various risks and challenges, including the need for additional financing and the uncertainties inherent in drug development, the company's experienced management team, innovative scientific approach, and robust pipeline of drug candidates position it as a compelling investment opportunity in the biopharmaceutical industry. As the company navigates the path to potential regulatory approvals and commercialization, investors will closely monitor its progress and ability to deliver on its promising pipeline.
The company has not experienced any major scandals, short seller reports, or CEO departures. However, the development of belapectin has faced some delays due to the COVID-19 pandemic, which impacted enrollment in the NAVIGATE clinical trial. Despite these challenges, Galectin Therapeutics was able to complete enrollment in February 2023 and remains on track to report top-line results in December 2024.
As a small, clinical-stage biopharmaceutical company, Galectin Therapeutics' future success hinges on the outcomes of its ongoing clinical trials, particularly the NAVIGATE study. Positive results could potentially transform the treatment landscape for NASH cirrhosis and position the company for significant growth. However, investors should be aware of the inherent risks associated with clinical-stage biotechnology companies and the need for additional financing to support ongoing operations and development programs.