Nektar Therapeutics (NASDAQ:NKTR) is a clinical-stage, research-based biopharmaceutical company focused on discovering and developing innovative medicines in the field of immunotherapy. The company's pipeline of clinical-stage and preclinical-stage immunomodulatory agents targets the treatment of autoimmune diseases and cancer.
Business Overview
Nektar's strategic direction is centered around creating new immunomodulatory agents that selectively induce, amplify, attenuate or prevent immune responses to achieve desired therapeutic outcomes. The company's lead programs include rezpegaldesleukin (previously referred to as NKTR-358) for autoimmune disorders and NKTR-255 for oncology applications.
Rezpegaldesleukin is a potential first-in-class resolution therapeutic designed to target the interleukin-2 (IL-2) receptor complex in the body to stimulate proliferation of regulatory T cells (Tregs). By activating these cells, rezpegaldesleukin may act to bring the immune system back into balance in autoimmune disorders. The company is currently evaluating rezpegaldesleukin in two Phase 2b studies - one in moderate-to-severe atopic dermatitis and another in severe-to-very severe alopecia areata.
NKTR-255 is an investigational biologic that targets the IL-15 pathway to activate the body's innate and adaptive immunity. The company is continuing select developmental studies of NKTR-255 in combination with cell therapies and checkpoint inhibitors.
In addition to its clinical-stage programs, Nektar is advancing its most promising research drug candidates, including NKTR-0165, a preclinical tumor necrosis factor receptor type II (TNFR2) agonist asset, into IND-enabling studies.
Financials
For the full year 2023, Nektar reported annual revenue of $90.1 million and a net loss of $276.1 million. The company's annual operating cash flow was -$192.6 million, and its annual free cash flow was -$193.5 million.
In the first quarter of 2024, Nektar generated revenue of $21.6 million, which included $15.5 million in non-cash royalty revenue and $6.0 million in product sales. The company reported a net loss of $36.8 million, or $0.19 per share, for the quarter.
Liquidity
As of March 31, 2024, Nektar had approximately $326.0 million in cash and investments in marketable securities. The company's cash runway now extends well into the third quarter of 2026, which will take it through several key data milestones, including the top-line data readouts from the Phase 2b studies of rezpegaldesleukin.
Nektar's financial position was bolstered during the first quarter of 2024 by a $30 million private placement of pre-funded warrants and a $15 million cash payment from an amendment to the 2020 agreement with Healthcare Royalty.
Recent Developments
In the first quarter of 2024, Nektar made significant advancements with its rezpegaldesleukin program. Enrollment is on track for the Phase 2b studies in atopic dermatitis and alopecia areata, with top-line data expected in the first half of 2025 for both indications.
The company also presented preclinical data on its NKTR-0165 TNFR2 agonist program at the European League Against Rheumatism (EULAR) conference in June 2024. Nektar is rapidly advancing this novel asset into IND-enabling studies, with plans to submit an IND in mid-2025.
For the company's NKTR-255 IL-15 program in oncology, Nektar is continuing its clinical collaborations, including an ongoing Phase 2 study evaluating NKTR-255 in combination with Yescarta® or Breyanzi® CD19 CAR-T cell therapy in patients with large B-cell lymphoma. The company also expects to receive data from the Phase 2 JAVELIN Bladder Medley study, evaluating NKTR-255 in combination with avelumab, in the second half of 2024.
Risks and Challenges
Nektar's business is subject to significant risks, including the inherent uncertainty of clinical development, competition from other immunotherapies, and the company's reliance on collaboration partnerships for the development and commercialization of its drug candidates.
The outcomes of Nektar's clinical trials, particularly for rezpegaldesleukin, will be critical in determining the future success of the company. Delays or failures in these trials could have a disproportionately negative impact on Nektar's scientific and medical prospects, financial condition, and market opportunities.
Additionally, Nektar's revenue has historically been derived exclusively from its collaboration agreements, which can result in significant fluctuations from period to period. The company's ability to establish and maintain successful collaboration partnerships on favorable terms will be crucial for its future growth and financial performance.
Outlook
Nektar enters 2024 with a strong financial position, a promising pipeline of immunology-focused drug candidates, and several key data readouts on the horizon. The company's lead program, rezpegaldesleukin, has demonstrated encouraging efficacy and safety data in early-stage trials and has the potential to address significant unmet needs in autoimmune disorders.
Conclusion
With a cash runway extending into the third quarter of 2026, Nektar is well-positioned to continue advancing its pipeline and achieving value-enhancing milestones. The company's focus on innovative immunomodulatory approaches, coupled with its robust financial footing, makes Nektar an intriguing player in the rapidly evolving immunotherapy landscape.