iTeos Therapeutics, Inc. (ITOS) is a clinical-stage biopharmaceutical company that is pioneering the discovery and development of a new generation of immuno-oncology therapeutics. By leveraging its deep understanding of tumor biology and immunosuppressive pathways, the company is designing novel product candidates with optimized pharmacologic properties to improve clinical outcomes by restoring the immune response against cancer.
Business Overview and Detailed Company History
iTeos was founded in 2011 as a spin-off from Ludwig Cancer Research and has since built significant expertise in tumor biology, immunology, and the characterization of resistance mechanisms in the tumor microenvironment. The company's internal research and development team has extensive experience in pharmacology and translational medicine, allowing them to measure the activity of product candidates in patients and identify the patients most likely to benefit from treatment.
iTeos began its research and development activities in 2011, focusing on discovering and developing a new generation of immuno-oncology therapeutics. The company built significant expertise in areas such as tumor biology, immunology, and the characterization of resistance mechanisms in the tumor microenvironment. iTeos also developed capabilities to create both small molecule and antibody product candidates with optimized profiles.
In 2017, iTeos entered into a collaboration agreement with Adimab, LLC to enable the company's antibody discovery and optimization efforts. One of the antibodies licensed under this agreement later became the company's lead clinical candidate, belrestotug, an antagonist of the TIGIT immune checkpoint.
Over the years, iTeos has made substantial progress in advancing its pipeline of immuno-oncology candidates. The company's lead clinical-stage antibody product, belrestotug, is an antagonist of TIGIT, an immune checkpoint with multiple mechanisms of action. Belrestotug was selected for its high affinity with TIGIT, potency, and potential to engage the Fc gamma receptor, a key regulator of immune response. This multi-faceted mechanism of action includes the activation of dendritic cells, natural killer cells, T lymphocytes, and macrophages, as well as the promotion of the release of cytotoxic granules and antibody-dependent cellular cytotoxicity.
In 2020, iTeos initiated an open-label Phase 1/2a clinical trial of belrestotug in adult cancer patients with advanced solid tumors. The preliminary data reported in April 2021 indicated target engagement and early evidence of clinical activity as a single agent. Recognizing the potential of belrestotug, iTeos entered into a collaboration agreement with GlaxoSmithKline (GSK) in June 2021, granting GSK an exclusive license to develop and commercialize belrestotug outside the United States, while the two companies will jointly develop and commercialize the asset in the U.S.
In partnership with GSK, iTeos is currently enrolling patients in multiple clinical trials for belrestotug, including the GALAXIES Lung-301 global, randomized, double-blind Phase 3 registrational study assessing the doublet of GSK's anti-PD-1 Jemperli (dostarlimab) with belrestotug versus placebo and pembrolizumab in patients with first-line PD-L1 high non-small cell lung cancer (NSCLC). The company also initiated the GALAXIES Lung-201 global, randomized, open-label Phase 2 platform study evaluating dostarlimab with belrestotug and in combination with GSK's investigational anti-CD96 antibody, nelistotug.
Beyond belrestotug, iTeos is also advancing its second clinical program, EOS-984, a potentially first-in-class small molecule that targets the adenosine pathway by inhibiting ENT1, a dominant transporter of extracellular adenosine expressed on intratumoral T cells. By blocking adenosine uptake, EOS-984 has the potential to fully reverse adenosine-mediated immune suppression and restore T cell proliferation and activity in the tumor microenvironment. The company is currently evaluating EOS-984 in a Phase 1 trial in advanced malignancies.
The third program in iTeos' pipeline is EOS-215, a potential best-in-class monoclonal antibody that antagonizes triggering receptor expressed on myeloid cells 2 (TREM2). TREM2-expressing macrophages in tumors promote tumor growth and survival, and the EOS-215 antibody is designed to block ligand binding and alter the function of these tumor-resident macrophages, resulting in anti-tumor effects. EOS-215 has completed IND-enabling studies and has demonstrated the ability to alter tumor macrophage function and promote anti-tumor immune responses in preclinical studies.
In December 2024, iTeos presented clinical, translational, and preclinical data from its adenosine A2AR antagonist program, inupadenant (also known as EOS-850). While the initial signal for inupadenant's recommended Phase 2 dose in the A2A-005 trial compared to chemotherapy alone was encouraging and supported its differentiated, insurmountable profile, the company and its scientific and clinical advisory boards believed it did not meet a sufficient level of clinical activity to warrant further investment. As a result, iTeos has decided to deprioritize inupadenant in favor of focusing its resources on its other promising pipeline programs.
Financial Overview and Ratios
As of December 31, 2024, iTeos had a strong cash and investment balance of $655.0 million, which the company expects will provide a runway through 2027. This robust financial position has been supported by several key events, including the $625.0 million upfront payment received from GSK in 2021 as part of the collaboration agreement for belrestotug, as well as a $120.0 million registered direct offering completed in 2024.
iTeos' financial performance has been marked by significant investments in research and development, as the company focuses on advancing its clinical-stage programs. For the year ended December 31, 2024, the company reported total revenue of $35.0 million, primarily related to the recognition of a milestone payment from the GSK collaboration for the initiation of a Phase 3 trial for belrestotug. Research and development expenses for the same period amounted to $145.45 million, while general and administrative expenses were $49.08 million, resulting in a net loss of $134.41 million.
The company's total operating expenses for 2024 were $194.5 million. Operating cash flow for the year was negative $98.18 million, while free cash flow was negative $99.81 million. For the fourth quarter of 2024, iTeos reported no revenue and a net loss of $43.71 million.
Liquidity
The company's current ratio, a measure of its ability to meet short-term obligations, stood at 12.62 as of December 31, 2024, indicating a strong liquidity position. The quick ratio was also 12.62, further confirming the company's strong short-term financial health. The debt-to-equity ratio was 0.01, suggesting a conservative capital structure with minimal leverage. iTeos' return on assets and return on equity for the year ended December 31, 2024 were -19.57% and -22.15%, respectively, reflecting the company's focus on investing in its clinical pipeline rather than generating near-term profitability.
As of December 31, 2024, iTeos had $142.13 million in cash and cash equivalents and $512.87 million in available-for-sale securities, for a total of $654.99 million in cash, cash equivalents and investments. The company's total debt stood at $5.10 million, with stockholders' equity of $590.29 million.
Market Overview and Competitive Landscape
iTeos operates in the global immuno-oncology market, which is expected to grow at a compound annual growth rate (CAGR) of approximately 11% from 2024 to 2030. This growth is driven by increasing cancer incidence rates, advancements in immunotherapy technologies, and a growing understanding of tumor biology and immune system interactions.
The company's focus on novel immuno-oncology approaches, particularly its lead candidate belrestotug targeting TIGIT, positions it well within this expanding market. However, iTeos faces competition from other biopharmaceutical companies developing similar or alternative approaches to cancer immunotherapy.
Risks and Challenges
As a clinical-stage biopharmaceutical company, iTeos faces several risks and challenges inherent to the industry. The development of its product candidates, including belrestotug, EOS-984, and EOS-215, is subject to the successful completion of preclinical studies and clinical trials, which can be a lengthy and uncertain process. Failures or delays in these trials could significantly delay or prevent the company from obtaining regulatory approvals and commercializing its products.
Moreover, iTeos operates in a highly competitive environment, with several other companies developing therapies that target the same or similar mechanisms of action as its product candidates. The company's ability to maintain a competitive edge will depend on its capacity to continue innovating, advancing its pipeline, and securing favorable regulatory approvals and reimbursement agreements.
Intellectual property protection is also crucial for iTeos, as the company's success heavily relies on its ability to protect its proprietary technologies and product candidates. Any challenges to the company's intellectual property rights could have a material adverse impact on its business.
Finally, as a global organization, iTeos is exposed to various risks, including fluctuations in foreign currency exchange rates, changes in healthcare laws and regulations, and the potential impact of public health challenges, such as the COVID-19 pandemic, on its operations and clinical trials.
Outlook and Conclusion
Despite the challenges, iTeos' strong financial position, robust pipeline, and strategic collaborations position the company well for future growth. The company's focus on advancing its TIGIT, adenosine, and TREM2 programs, coupled with the potential of belrestotug in combination with Jemperli, suggests that iTeos could be at the forefront of the next wave of immuno-oncology breakthroughs.
The company's partnership with GSK for belrestotug development and commercialization provides significant financial and strategic benefits, including the potential for up to $1.45 billion in milestone payments in addition to the $625 million upfront payment already received. This collaboration not only validates iTeos' scientific approach but also provides resources and expertise to accelerate the development of belrestotug.
iTeos' pipeline diversity, with programs targeting different aspects of cancer immunology, provides multiple opportunities for success and helps mitigate risk. The advancement of EOS-984 and EOS-215, alongside the flagship belrestotug program, demonstrates the company's commitment to exploring various innovative approaches to cancer treatment.
The company's strong cash position, with $655 million in cash and investments as of the end of 2024, provides a runway through 2027, allowing iTeos to continue investing in its pipeline and clinical programs without immediate funding concerns. This financial stability is crucial for a clinical-stage biotech company, enabling it to weather potential setbacks and capitalize on opportunities as they arise.
As iTeos continues to execute on its strategic priorities and achieve key milestones across its pipeline, investors will be closely watching the company's progress. With a deep understanding of tumor biology, a talented team, and a steadfast commitment to innovation, iTeos Therapeutics appears poised to make a significant impact in the fight against cancer. The company's focus on developing novel, potentially first-in-class or best-in-class therapies in the rapidly growing field of immuno-oncology positions it well for long-term success in the biopharmaceutical industry.