NEW HOPE, Pa., May 12, 2023 (GLOBE NEWSWIRE) — Orchestra BioMed Holdings, Inc. (Nasdaq: OBIO), a biomedical company accelerating high-impact technologies to patients through risk-reward sharing partnerships, today reported its first quarter 2023 financial results and provided a business update.
“The first quarter of 2023 was a transformational period for Orchestra BioMed marked by our successful entrance into the public markets. In the last year, we completed our BackBeat CNT strategic collaboration with Medtronic, the global leader in cardiac pacing therapies, and significantly strengthened our balance sheet with support from leading healthcare and strategic investors. With these accomplishments, we believe we have long-term capital resources to execute pivotal clinical studies for our two lead programs, BackBeat CNT and Virtue SAB,” stated David Hochman, Chairman, Co-founder and Chief Executive Officer of Orchestra BioMed. “We plan to start the BackBeat CNT and Virtue SAB pivotal studies this year and look forward to generating key data to support regulatory submissions for these high-impact therapeutic devices. It is an ideal time to be pursuing our innovative, partnership-enabled business model, and our team is focused on delivering significant value for our shareholders, physicians, and patients.”
Corporate highlights
- Completed successful business combination with Health Sciences Acquisition Corp 2 (“HSAC2”), a special purpose acquisition company sponsored by an affiliate of RTW Investments, LP (“RTW”), on January 26, 2023. Gross proceeds from the transaction were approximately $70 million and the transaction was supported by approximately $28 million in market purchases of HSAC2 stock and investments by funds managed by RTW affiliates and approximately $10 million in market purchases of HSAC2 stock by an affiliate of Medtronic plc (“Medtronic”).
- Strengthened senior leadership team with appointment of Avi Fischer, M.D., as Senior Vice President (SVP), Medical Affairs and Innovation; J.C. Simeon as SVP, Quality; George Papandreou, Ph.D., as General Manager and SVP, Focal Therapies; and Kunal Faldu as Vice President, Pharmaceutical Development.
Pipeline highlights
- BackBeat Cardiac Neuromodulation Therapy (CNT™) – Hypertension in Pacemaker Patients
- Global pivotal study evaluating the efficacy and safety of BackBeat CNT in adult patients with hypertension who are indicated for a pacemaker on track to start in the second half of 2023
- Virtue® Sirolimus AngioInfusionTM Balloon (SAB) – Coronary Indications
- U.S. pivotal study evaluating Virtue SAB in adult patients with coronary ISR planned to start in the second half of 2023
- Additional Virtue SAB clinical studies in coronary ISR and small vessel disease planned in partnership with Terumo, the Company’s global strategic partner for development and commercialization of Virtue SAB
Financials
- Cash Position: As of March 31, 2023, Orchestra BioMed had cash and cash equivalents and marketable securities of $127.1 million, compared to $83.7 million as of December 31, 2022. The increase in cash was primarily due to the net proceeds provided by the closing of the business combination with HSAC2, less cash used in operating activities during the quarter and fees and expenses associated with the business combination. Based on current clinical development and other research and development plans and budget estimates, the Company anticipates that the cash and cash equivalents and marketable securities are sufficient to fund operations into 2026.
- Revenue: Orchestra BioMed recognized $1.2 million of revenue for the first quarter of 2023 compared to $0.9 million for the first quarter of 2022. The increase was primarily due to increased recognition of partnership revenues earned under the Terumo agreement.
- Research and Development Expenses: Research and development (R&D) expenses were $8.3 million for the first quarter of 2023 compared to $3.5 million for the first quarter of 2022. The increase was primarily due to additional costs associated with preparations for the launch of the Virtue SAB and BackBeat CNT pivotal clinical studies, as well as an increase of $0.5 million in non-cash stock-based compensation expense.
- Selling, General and Administrative Expenses: Selling, general and administrative expenses were $4.4 million for the first quarter of 2023, compared to $2.5 million for the first quarter of 2022. The increase was primarily due to additional personnel costs, legal, insurance and finance costs, transaction costs incurred related to the closing of the business combination and included an increase of $0.9 million in non-cash stock-based compensation expense.
- Other Income (Expense): Other income was $0.6 million for the first quarter of 2023, compared to other expense of $0.6 million for the first quarter of 2022. Interest income (expense), net, increased by $1.1 million from the first quarter of 2022 due to the higher cash balance and an increase in interest rates.
- Net Loss: Net loss was $10.9 million for the first quarter of 2023, or $0.40 per share, compared to a net loss of $5.7 million, or $0.62 per share, for the same period in 2022. The net loss for the first quarter of 2023 includes $1.8 million in non-cash stock-based compensation expense and loss on fair value adjustment of warrant liability as compared to $0.2 million for the first quarter of 2022.
About BackBeat CNT and the Strategic Collaboration with Medtronic
BackBeat CNT is an investigational bioelectronic treatment designed to lower blood pressure. It is compatible with standard pacemakers as a firmware upgrade and has been evaluated in pilot studies in patients with hypertension who are also indicated for pacemakers. It is estimated that more than 70% of the approximately 1.1 million people globally who are implanted with cardiac pacemakers each year are also diagnosed with hypertension1.
The peer-reviewed, double-blind, randomized pilot study, MODERATO II, showed that patients treated with BackBeat CNT experienced net reductions of 8.1 mmHg in 24-hour ambulatory systolic blood pressure (aSBP) and 12.3 mmHg in office systolic blood pressure (oSBP) when compared to control patients at six months. Orchestra BioMed plans to conduct a global pivotal study to further evaluate the safety and efficacy of BackBeat CNT in lowering blood pressure in a similar target population of patients who have been indicated for, and recently received, a cardiac pacemaker implant. The strategic collaboration with Medtronic will provide Orchestra BioMed with development, clinical, and regulatory support for this planned global study. Upon regulatory approval, Medtronic will have the global rights to commercialize BackBeat CNT-enabled pacing systems for this target population. Orchestra BioMed will share in the revenues generated from Medtronic sales of the BackBeat CNT-enabled pacing systems.
About Virtue SAB and the Strategic Collaboration with Terumo
Virtue SAB is a patented drug/device combination product candidate in development for the treatment of certain forms of artery disease that is designed to deliver a proprietary, investigational, extended-release formulation of sirolimus, SirolimusEFR™, to the vessel wall during balloon angioplasty without any coating on the balloon surface or the need to leave a stent or other permanent implant in the artery. Virtue SAB demonstrated positive three-year clinical data in coronary in-stent restenosis (ISR) in the SABRE study, a multi-center prospective, independent core lab-adjudicated clinical study of 50 patients conducted in Europe. Virtue SAB has been granted Breakthrough Device designation by the U.S. Food and Drug Administration for specific indications relating to coronary ISR, coronary small vessel disease and peripheral artery disease below-the-knee.
Under the terms of their collaboration agreement, Orchestra BioMed and Terumo plan to execute a global clinical program in an effort to gain regulatory approval for commercial sale of Virtue SAB in multiple markets and indications. Terumo made an upfront payment of $30 million to Orchestra BioMed and Terumo will potentially make additional future clinical and regulatory milestone payments. Orchestra BioMed will share meaningfully in future commercial revenues of Virtue SAB through royalties and per unit payments as the exclusive supplier of SirolimusEFR. Orchestra BioMed retains the rights to develop and license SirolimusEFR and other technologies used in Virtue SAB for clinical applications outside of coronary and peripheral vascular interventions.
About Orchestra BioMed
Orchestra BioMed (Nasdaq: OBIO) is a biomedical innovation company accelerating high-impact technologies to patients through risk-reward sharing partnerships with leading medical device companies. Orchestra BioMed’s partnership-enabled business model focuses on forging strategic collaborations with leading medical device companies to drive successful global commercialization of products it develops. Orchestra BioMed’s flagship product candidates include BackBeat Cardiac Neuromodulation Therapy™ (CNT™) for the treatment of hypertension, a significant risk factor for death worldwide, and Virtue® Sirolimus AngioInfusion™ Balloon (SAB) for the treatment of atherosclerotic artery disease, the leading cause of mortality worldwide. Orchestra BioMed has a strategic collaboration with Medtronic, one of the largest medical device companies in the world, for development and commercialization of BackBeat CNT for the treatment of hypertension in pacemaker-indicated patients, and a strategic partnership with Terumo Corporation, a global leader in medical technology, for development and commercialization of Virtue SAB for the treatment of artery disease. Orchestra BioMed has additional product candidates and plans to potentially expand its product pipeline through acquisitions, strategic collaborations, licensing, and organic development. For further information about Orchestra BioMed, please visit www.orchestrabiomed.com, and follow us on LinkedIn and Twitter.
