Business Overview
Tempest Therapeutics, Inc. (NASDAQ:TPST) is a clinical-stage biotechnology company focused on developing novel targeted and immune-mediated therapies to treat a wide range of cancers. With a diverse pipeline of first-in-class product candidates, the company is making significant strides in the oncology space, positioning itself as a promising investment opportunity.Tempest Therapeutics is advancing two lead clinical-stage product candidates, TPST-1120 and TPST-1495, which target distinct pathways involved in cancer progression. TPST-1120 is a selective antagonist of peroxisome proliferator-activated receptor alpha (PPARα), while TPST-1495 is a dual antagonist of the EP2 and EP4 receptors of prostaglandin E2. Both programs are currently in clinical trials, with TPST-1120 poised to potentially enter a pivotal Phase 3 study in first-line hepatocellular carcinoma (HCC) following positive data from the ongoing randomized Phase 1b/2 trial.
In addition to its clinical-stage assets, Tempest Therapeutics maintains a robust discovery research pipeline, leveraging its expertise and collaborations to identify and validate new therapeutic targets in oncology. The company's multidisciplinary approach to drug development positions it well to continue expanding its portfolio and addressing unmet needs in the treatment of various cancer types.
Financials
Tempest Therapeutics reported an annual net loss of $29,491,000 for the fiscal year ended December 31, 2023, with no revenue generated during the period. The company's annual operating cash flow was -$27,357,000, and its annual free cash flow was -$27,527,000. These financial results reflect the company's ongoing investment in research and development activities to advance its pipeline of product candidates.For the first quarter of 2024, Tempest Therapeutics reported a net loss of $7,904,000, with no revenue generated during the period. The company's quarterly operating cash flow was -$7,186,000, and its quarterly free cash flow was -$7,356,000. These quarterly figures are consistent with the company's focus on clinical development and the associated expenses.
Liquidity
As of March 31, 2024, Tempest Therapeutics had cash and cash equivalents of $32,326,000, providing the company with the necessary resources to continue advancing its pipeline. The company's balance sheet reflects a current ratio of 3.13, indicating a strong liquidity position to fund its ongoing operations and development activities.Tempest Therapeutics has also taken steps to bolster its financial flexibility, including the implementation of an at-the-market (ATM) offering program in 2021, which allows the company to sell up to $100 million of its common stock. As of March 31, 2024, the company had approximately $57.3 million remaining under the ATM program, providing additional access to capital as needed.
Clinical Pipeline and Milestones
TPST-1120 (PPARα Antagonist)
Tempest Therapeutics' lead product candidate, TPST-1120, is a selective antagonist of PPARα, a nuclear receptor that plays a crucial role in regulating cellular metabolism and immune function. The company is currently evaluating TPST-1120 in a global randomized Phase 1b/2 trial in patients with advanced or metastatic HCC, where it is being studied in combination with the standard-of-care regimen of atezolizumab and bevacizumab.In October 2023, Tempest Therapeutics announced positive results from the planned data analysis of the ongoing Phase 1b/2 trial. The data showed a 30% confirmed objective response rate (ORR) in the TPST-1120 arm, compared to a 13.3% ORR in the control arm. Additionally, 40% of patients in the TPST-1120 arm remained on treatment, versus 16.7% in the control arm, and 72.5% of the TPST-1120 arm patients remained on study, compared to 46.7% in the control arm. The results also demonstrated favorable progression-free survival and overall survival hazard ratios for the TPST-1120 arm compared to the standard-of-care control arm.
Based on these encouraging data, Tempest Therapeutics plans to meet with the FDA in 2024 to discuss the potential for a pivotal Phase 3 trial of TPST-1120 in first-line HCC. The company is also evaluating the potential development of TPST-1120 in other indications, such as renal cell carcinoma (RCC) and cholangiocarcinoma (CCA), based on the Phase 1 data presented at the 2022 American Society of Clinical Oncology (ASCO) annual meeting.
TPST-1495 (Dual EP2/EP4 Antagonist)
Tempest Therapeutics' second clinical-stage product candidate, TPST-1495, is a dual antagonist of the EP2 and EP4 receptors of prostaglandin E2 (PGE2). The company is currently evaluating TPST-1495 in an ongoing Phase 1 combination trial in patients with endometrial cancer, where prostaglandin signaling is implicated.In addition to the endometrial cancer study, Tempest Therapeutics is planning to advance TPST-1495 into a new indication, Familial Adenomatous Polyposis (FAP), for which there are currently no approved therapies. Based on positive preclinical data in a relevant mouse model and the role of prostaglandin signaling in FAP, the company believes there is a strong mechanistic rationale for this approach. Tempest Therapeutics is working with the Cancer Prevention Clinical Trials Network on a National Cancer Institute (NCI)-funded Phase 2 study in FAP, and subject to final approval from the consortium, plans to initiate the study in 2024.
Risks and Challenges
As a clinical-stage biotechnology company, Tempest Therapeutics faces several risks and challenges inherent to the industry. These include the inherent uncertainty of clinical development, the potential for regulatory delays or setbacks, competition from other therapies, and the need to continuously secure funding to support its operations and pipeline advancement.The company's reliance on the successful development and commercialization of its lead product candidates, TPST-1120 and TPST-1495, represents a significant risk. Any delays or failures in the clinical trials or regulatory approval process for these assets could have a material adverse impact on Tempest Therapeutics' business and financial performance.
Additionally, the company's ability to effectively manage its growth and expand its pipeline of product candidates will be crucial to its long-term success. The company's continued investment in research and development, as well as its ability to identify and validate new therapeutic targets, will be key factors in driving its future growth and diversifying its portfolio.
Outlook
Tempest Therapeutics is well-positioned to capitalize on the significant opportunities in the oncology market, with a promising pipeline of novel targeted and immune-mediated therapies. The positive data from the ongoing TPST-1120 Phase 1b/2 trial in HCC, coupled with the company's plans to advance the program into a pivotal Phase 3 study, represent a significant milestone that could drive substantial value for shareholders.Furthermore, the company's diversified pipeline, including the TPST-1495 program and its discovery research efforts, provides a solid foundation for long-term growth and the potential to address unmet needs across various cancer indications. Tempest Therapeutics' strong financial position, with a healthy cash balance and access to additional capital through its ATM program, further supports its ability to execute on its strategic objectives.