Company Overview
Surrozen, Inc. (SRZN) is a clinical-stage biopharmaceutical company that has been making significant strides in the field of regenerative medicine. Founded in 2015, the company has positioned itself as a pioneer in the development of targeted therapeutics that selectively activate the Wnt pathway, a critical mediator of tissue repair and regeneration. With a focus on addressing severe and unmet medical needs, Surrozen’s innovative approach has caught the attention of both the scientific community and investors alike.
Company History
The company’s journey began in 2015 when its founders and scientific advisors, who were instrumental in the discovery of the Wnt gene and key regulators of the Wnt pathway, established Surrozen. Recognizing the immense potential of harnessing the power of Wnt signaling, the team set out to overcome the limitations that had previously hindered the development of Wnt-based therapies. Through their groundbreaking research, they developed a proprietary platform that enables the rapid and flexible design of tissue-targeted therapeutics capable of modulating the Wnt pathway.
In March 2016, Surrozen took a significant step forward by entering into a license agreement with Stanford University, securing worldwide exclusive rights to certain patents and technology related to its engineered Wnt surrogate molecules. This move laid the foundation for the company’s intellectual property portfolio. Building on this momentum, Surrozen continued to expand its IP assets, entering into another license agreement with Stanford University in 2018 for patent rights related to its surrogate R-spondin proteins. During this period, the company also forged various other licensing and collaboration agreements to support its research and development activities.
Challenges and Milestones
Despite making progress in its early years, Surrozen faced several challenges that tested its resilience. The company encountered difficulties with patient enrollment in its clinical trials and experienced issues with its manufacturing processes. These obstacles led to the pause or delay of certain development programs. However, Surrozen’s determination and innovative spirit prevailed, allowing it to overcome these hurdles and continue advancing its lead product candidate, SZN-43.00. In a significant milestone, Surrozen initiated its first-in-human trials for SZN-43.00 in 2022, marking a crucial step in its clinical development journey.
Product Pipeline
Surrozen’s lead product candidate, SZN-043, is a hepatocyte-specific R-spondin mimetic bispecific fusion protein that targets the ASGR1 receptor. This innovative approach is designed to selectively activate Wnt signaling in the liver, stimulating transient hepatocyte proliferation and improving liver function. After successfully completing a Phase 1a clinical trial in healthy volunteers and patients with a history of liver cirrhosis, Surrozen is currently enrolling patients in a Phase 1b clinical trial evaluating SZN-043 in severe alcohol-associated hepatitis (sAH). The company expects to present proof-of-concept data from this study in the first half of 2025.
In addition to their work on SZN-043, Surrozen has also made significant progress in developing a portfolio of ophthalmology product candidates. These include SZN-413, a Frizzled 4 (Fzd4)-targeted bispecific antibody being developed in collaboration with Boehringer Ingelheim for the treatment of retinal vascular-associated diseases. In September 2024, Boehringer Ingelheim decided to move forward with the development of SZN-413, triggering a $10 million milestone payment to Surrozen.
Beyond SZN-413, Surrozen has multiple other novel ophthalmology product candidates targeting Fzd4, which have demonstrated proof-of-concept in preclinical studies for indications such as diabetic macular edema, neovascular age-related macular degeneration, and Fuchs endothelial corneal dystrophy. These programs are wholly owned by Surrozen and do not fall within the scope of the collaboration with Boehringer Ingelheim.
Financials
Surrozen’s financial position as of September 30, 2024, reflects the company’s ongoing investments in its research and development pipeline. The company reported cash and cash equivalents of $31.0 million, with a net loss of $35.5 million for the nine months ended September 30, 2024. The company’s quarterly net loss for the third quarter of 2024 was $1.4 million, a significant improvement compared to the $10.4 million net loss reported in the same period of the previous year.
For the most recent fiscal year (2023), Surrozen reported no revenue, a net income of -$43,042,000, operating cash flow of -$40,363,000, and free cash flow of -$40,761,000. In contrast, the most recent quarter (Q3 2024) showed a substantial improvement with revenue of $10,000,000, primarily due to the recognition of the $10 million milestone payment from Boehringer Ingelheim. The net income for Q3 2024 was -$1,434,000, with operating cash flow and free cash flow both at -$6,752,000.
The year-over-year growth in Q3 2024 was marked by the increase in revenue and decrease in net loss, operating cash flow, and free cash flow compared to the prior year quarter, primarily attributed to the milestone payment from the Collaboration and License Agreement with Boehringer Ingelheim.
Liquidity
The company’s financial performance has been bolstered by strategic partnerships and collaborations, as demonstrated by the $10 million milestone payment received from Boehringer Ingelheim in the third quarter of 2024. Additionally, in April 2024, Surrozen raised $16.0 million in net proceeds from a private placement of common stock, pre-funded warrants, and accompanying warrants, further strengthening its financial position and extending its cash runway.
Surrozen’s liquidity position is characterized by a debt-to-equity ratio of 0.03, indicating a low level of debt relative to equity. The company’s cash and cash equivalents stand at $31,010,000, providing a solid foundation for ongoing operations and research activities. Both the current ratio and quick ratio are 7.40, suggesting strong short-term liquidity and the ability to meet immediate obligations. It’s worth noting that the company has not disclosed any credit facilities or credit lines.
Future Outlook
Despite the challenges faced by the biotechnology industry, Surrozen has demonstrated its resilience and ability to navigate the regulatory landscape. The company’s focus on developing targeted therapies that selectively activate the Wnt pathway has positioned it at the forefront of regenerative medicine, offering hope for patients suffering from severe and debilitating conditions.
As Surrozen continues to advance its clinical programs and expand its pipeline, the company’s progress will be closely monitored by the investment community. The successful development and potential commercialization of SZN-043 and its ophthalmology candidates could significantly bolster Surrozen’s future growth and solidify its position as a leading innovator in the field of targeted therapeutics.
The company’s accumulated deficit of $257.22 million as of September 30, 2024, underscores the substantial investments made in research and development. However, the recent milestone payment from Boehringer Ingelheim and the ongoing collaboration demonstrate the potential for future revenue streams and validate the company’s approach to developing innovative therapeutics.
Surrozen’s ability to manage its cash resources effectively while advancing its Wnt therapeutics platform will be crucial in the coming years. The company’s focus on both liver-targeted therapies and ophthalmology presents diversified opportunities for growth and potential partnerships in multiple therapeutic areas.
Disclaimer: This article is for informational purposes only. It does not constitute financial, legal, or other types of advice. While every effort has been made to ensure the accuracy of the information presented here, the author and the publisher do not make any guarantees about the completeness, reliability, and accuracy of this information.