Relay Therapeutics, Inc. (NASDAQ:RLAY) is a clinical-stage precision medicine company that is revolutionizing the drug discovery process by combining leading-edge computational and experimental technologies. The company's innovative Dynamo™ platform integrates an array of cutting-edge approaches to target proteins that have previously been considered intractable or inadequately addressed.

Relay Therapeutics' focus on precision oncology and genetic diseases has yielded a robust pipeline of product candidates, including three lead assets currently in clinical development: RLY-2608, RLY-4008 (lirafugratinib), and GDC-1971 (migoprotafib, formerly known as RLY-1971).

Financials

Relay Therapeutics has reported annual net losses of $341.97 million in 2023, with annual revenue of $25.55 million. The company's annual operating cash flow was -$300.32 million, and its annual free cash flow was -$304.44 million.

For the first quarter of 2024, the company reported revenue of $10.0 million, a significant increase from $0.2 million in the same period of 2023. This was primarily driven by a $10.0 million milestone payment received under the Genentech Agreement. The company's net loss for the quarter was $81.4 million, compared to a net loss of $94.2 million in the first quarter of 2023.

Relay Therapeutics' cash, cash equivalents, and investments totaled $749.6 million as of March 31, 2024, which the company believes will enable it to fund its operations into the second half of 2026.

Business Overview

Relay Therapeutics was founded in 2015 with the goal of transforming the drug discovery process by leveraging its Dynamo platform, which integrates computational and experimental approaches. The company's focus on precision medicine has led to the development of a diverse pipeline of product candidates targeting oncology and genetic disease indications.

RLY-2608

: Relay Therapeutics' lead program is RLY-2608, an allosteric, pan-mutant and isoform-selective phosphoinositide 3-kinase alpha (PI3Kα) inhibitor. In December 2021, the company dosed the first patient in the ReDiscover Trial, a first-in-human clinical trial for RLY-2608. The trial is evaluating RLY-2608 as a monotherapy and in combination with fulvestrant in patients with HR+, HER2–, PI3Kα-mutated, locally advanced or metastatic breast cancer. In July 2023, Relay Therapeutics initiated a dose expansion cohort in this patient population, with patients receiving a 600 mg twice daily dose of RLY-2608 in combination with fulvestrant.

Lirafugratinib (RLY-4008)

: Lirafugratinib is a potent, selective and oral small molecule inhibitor of fibroblast growth factor receptor 2 (FGFR2). In the third quarter of 2020, Relay Therapeutics initiated the ReFocus Trial, a first-in-human clinical trial for lirafugratinib in patients with FGFR2-altered tumors. The dose expansion part of the trial, which includes four cholangiocarcinoma (CCA) arms and three tumor agnostic (non-CCA) arms, is ongoing at a 70 mg once daily recommended Phase 2 dose.

Migoprotafib (GDC-1971, formerly known as RLY-1971)

: In the first quarter of 2020, Relay Therapeutics initiated a Phase 1a clinical trial for migoprotafib, its inhibitor of Src homology region 2 domain-containing phosphatase-2 (SHP2), as a monotherapy in patients with advanced or metastatic solid tumors. In December 2020, the company entered into a global collaboration and license agreement with Genentech for the development and commercialization of migoprotafib.

In addition to these lead programs, Relay Therapeutics has more than seven active discovery stage programs across both precision oncology and genetic diseases.

Risks and Challenges

Relay Therapeutics operates in a highly competitive biopharmaceutical industry, facing competition from other companies developing therapies for targeted oncology and genetic disease indications. The company's success will depend on its ability to advance its product candidates through clinical development and obtain regulatory approvals, as well as its capacity to manufacture and commercialize any approved products.

Key risks facing Relay Therapeutics include the company's limited operating history, the inherent uncertainties of drug development, the need for substantial additional funding, and the potential for regulatory and commercial challenges. The company's reliance on third-party manufacturers and collaborators also introduces additional risks related to the supply and development of its product candidates.

Outlook

Relay Therapeutics' innovative approach to drug discovery, as exemplified by its Dynamo platform, has positioned the company as a leader in the precision medicine space. The company's robust pipeline of product candidates, including three assets currently in clinical development, underscores its potential to transform the treatment of targeted oncology and genetic disease indications.

Conclusion

While Relay Therapeutics faces significant challenges common to the biopharmaceutical industry, the company's strong financial position, with $749.6 million in cash, cash equivalents, and investments as of March 31, 2024, provides a solid foundation to advance its research and development efforts. As the company continues to execute on its strategic priorities, investors will closely monitor the progress of Relay Therapeutics' clinical programs and its ability to navigate the competitive landscape and regulatory environment.