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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of report (Date of earliest event reported): November 7, 2023

 

NEKTAR THERAPEUTICS

(Exact Name of Registrant as Specified in Charter)

 

Delaware   0-24006   94-3134940
(State or Other Jurisdiction
of Incorporation)
  (Commission File Number)   (IRS Employer
Identification No.)

 

455 Mission Bay Boulevard South

San Francisco, California 94158

(Address of Principal Executive Offices and Zip Code)

 

Registrant’s telephone number, including area code: (415) 482-5300

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading symbol(s)   Name of each exchange on which registered
Common Stock, $0.0001 par value   NKTR   NASDAQ Global Select Market

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

 

 

 

Item 2.02 Results of Operations and Financial Condition.

 

On November 7, 2023, Nektar Therapeutics, a Delaware corporation (“Nektar”), issued a press release (the “Press Release”) announcing its financial results for the quarter ended September 30, 2023. A copy of the Press Release is furnished herewith as Exhibit 99.1.

 

The information in this report, including the exhibit hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information contained herein and in the accompanying exhibit shall not be incorporated by reference into any filing with the Securities and Exchange Commission made by Nektar, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.   Description 
99.1   Press release titled “Nektar Therapeutics Reports Third Quarter 2023 Financial Results.”
104   Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

  NEKTAR THERAPEUTICS
     
Date: November 7, 2023 By: /s/ Mark A. Wilson
    Mark A. Wilson
    Chief Legal Officer and Secretary

 

 

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Exhibit 99.1

 

 

 

Nektar Therapeutics Reports Third Quarter 2023 Financial Results

 

SAN FRANCISCO, November 7, 2023 /PRNewswire/ -- Nektar Therapeutics (Nasdaq: NKTR) today reported financial results for the third quarter ended September 30, 2023.

 

Cash and investments in marketable securities at September 30, 2023, were $372.7 million as compared to $505.0 million at December 31, 2022. Nektar’s cash and marketable securities are expected to support strategic development activities and operations into the middle of 2026.

 

“We’ve made significant progress across our pipeline, including initiating a Phase 2b atopic dermatitis study in October and completing plans to start a Phase 2b alopecia areata study in early 2024,” said Howard W. Robin, President and CEO of Nektar. “These two studies position us for important and transformative data readouts for rezpegaldesleukin in the first half of 2025. In September, we signed a new clinical study collaboration with cell therapy leader, Cellular Biomedicine Group, who will evaluate NKTR-255 in combination with CBMG’s tumor-infiltrating lymphocyte therapy in advanced non-small cell lung cancer. This study is an example of the potential of NKTR-255 in combination with a range of cell therapies in liquid and solid tumors. Finally, we will end this year in a strong financial position with at least $320 million in cash and investments which provides us with a cash runway into the middle of 2026.”

 

Summary of Financial Results

 

Revenue in the third quarter of 2023 was $24.1 million as compared to $23.6 million in the third quarter of 2022. Revenue for the first nine months of 2023 was $66.2 million as compared to $70.0 million in the first nine months of 2022.

 

Total operating costs and expenses in the third quarter of 2023 were $69.0 million as compared to $77.9 million in the third quarter of 2022. Total operating costs and expenses in the first nine months of 2023 were $296.4 million as compared to $393.7 million in the first nine months of 2022. The reduction in operating costs and expenses for both the third quarter and the first nine months of 2023 were due to decreases in research and development expenses, general and administrative expense and restructuring, impairment and costs of terminated program. For the first nine months of 2023, these decreases were partially offset by $76.5 million in non-cash goodwill impairment.

 

R&D expense in the third quarter of 2023 was $24.1 million as compared to $33.6 million for the third quarter of 2022. For the first nine months of 2023, R&D expense was $84.2 million as compared to $183.6 million in the first nine months of 2022. R&D expense decreased for both the third quarter and first nine months of 2023 due to the wind down of the bempegaldesleukin program.

 

G&A expense was $21.1 million in the third quarter of 2023 as compared to $22.5 million in the third quarter of 2022. For the first nine months of 2023, G&A expense was $60.1 million as compared to $70.4 million in the first nine months of 2022. G&A expense decreased for both the third quarter and first nine months of 2023 due to the wind down of the bempegaldesleukin program.

 

Restructuring, impairment and costs of terminated program were $11.4 million in the third quarter of 2023 as compared to $16.8 million in the third quarter of 2022. The amount for the third quarter of 2023 includes $10.2 million in non-cash lease and equipment impairment charges, $0.7 million for the wind down of the bempegaldesleukin program and $0.5 million in severance. The amount for the third quarter of 2022 includes $8.5 million for the wind down of the bempegaldesleukin program, $5.0 million for contract termination and other restructuring costs, $2.1 million in severance and $1.2 million in non-cash lease impairment charges.

 

 

 

 

For the first nine months of 2023, restructuring, impairment and costs of terminated program were $49.1 million. This amount includes $36.6 million in non-cash lease and equipment impairment charges, $8.0 million in severance and $3.6 million for the wind down of the bempegaldesleukin program.

 

For the first nine months of 2022, restructuring, impairment and costs of terminated program were $124.4 million. This amount includes $58.5 million in non-cash lease and equipment impairment charges, $29.8 million in severance, $28.9 million for the wind down of the bempegaldesleukin program and $7.1 million in contract termination and other restructuring costs.

 

Net loss for the third quarter of 2023 was $45.8 million or $0.24 basic and diluted loss per share as compared to a net loss of $59.0 million or $0.31 basic and diluted loss per share in the third quarter of 2022. Net loss in the first nine months of 2023 was $234.0 million or $1.23 basic and diluted loss per share as compared to a net loss of $308.5 million or $1.65 basic and diluted loss per share in the first nine months of 2022. Excluding the $10.2 million in non-cash impairment charges, net loss, on a non-GAAP basis, for the third quarter of 2023 was $35.7 million or $0.19 basic and diluted loss per share. Excluding the $113.1 million in non-cash goodwill and other impairment charges, net loss, on a non-GAAP basis, for the first nine months of 2023 was $120.8 million or $0.64 basic and diluted loss per share.

 

Third Quarter 2023 and Recent Business Updates

 

In September 2023, Nektar announced a clinical study collaboration with Cellular Biomedicine Group Inc. (CBMG) to evaluate NKTR-255 in combination with C-TIL051 in advanced non-small cell lung cancer (NSCLC) patients that are relapsed or refractory to anti-PD-1 therapy. Under the collaboration, CBMG will add NKTR-255 to its ongoing Phase 1 clinical trial being conducted at Duke Cancer Institute. Enrollment for this trial is ongoing.

 

In October 2023, Nektar presented final data from the Phase 1b study of rezpegaldesleukin in patients with atopic dermatitis at the 2023 European Academy of Dermatology and Venereology (EADV) Congress.

 

oPatients with moderate-to-severe AD that were treated with rezpegaldesleukin showed dose-dependent improvements in Eczema Area and Severity Index (EASI), Validated Investigator Global Assessment (vIGA), Body Surface Area (BSA), and Itch Numeric Rating Scale (NRS) over 12 weeks of treatment compared to placebo, which were sustained post-treatment over an additional 36 weeks.

 

oAt the highest studied dose, the proportion of Daily Life Quality Index (DLQI) responders was 75% and the proportion of Patient Oriented Eczema Measure (POEM) responders was 65% at week 12.

 

orezpegaldesleukin was well tolerated with no patients in the rezpegaldesleukin groups experiencing severe, serious, or fatal adverse events, and no anti-rezpegaldesleukin antibodies were detected.

 

In October 2023, Nektar initiated a Phase 2b study of rezpegaldesleukin in patients with atopic dermatitis.

 

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Conference Call to Discuss Third Quarter 2023 Financial Results

 

Nektar management will host a conference call to review the results beginning at 5:00 p.m. Eastern Time/2:00 p.m. Pacific Time, November 7, 2023.

 

This press release and live audio-only webcast of the conference call can be accessed through a link that is posted on the Home Page and Investors section of the Nektar website: http://ir.nektar.com/. The web broadcast of the conference call will be available for replay through December 8, 2023.

 

To access the conference call, please pre-register at Nektar Earnings Call Registration. All registrants will receive dial-in information and a PIN allowing them to access the live call.

 

About Nektar Therapeutics

 

Nektar Therapeutics is a biopharmaceutical company with a robust, wholly owned R&D pipeline of investigational medicines in immunology and oncology as well as a portfolio of approved partnered medicines. Nektar is headquartered in San Francisco, California, with additional manufacturing operations in Huntsville, Alabama. Further information about the company and its drug development programs and capabilities may be found online at http://www.nektar.com.

 

Cautionary Note Regarding Forward-Looking Statements

 

This press release contains forward-looking statements which can be identified by words such as: "will," "could," "develop," "potential," "advance" and similar references to future periods. Examples of forward-looking statements include, among others, statements regarding the therapeutic potential of, and future development plans for, rezpegaldesleukin and NKTR-255. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results to differ materially from those indicated in the forward-looking statements include, among others: (i) our statements regarding the therapeutic potential of rezpegaldesleukin and NKTR-255 are based on preclinical and clinical findings and observations and are subject to change as research and development continue; (ii) rezpegaldesleukin and NKTR-255 are investigational agents and continued research and development for these drug candidates is subject to substantial risks, including negative safety and efficacy findings in future clinical studies (notwithstanding positive findings in earlier preclinical and clinical studies); (iii) rezpegaldesleukin and NKTR-255 are in various stages of clinical development and the risk of failure is high and can unexpectedly occur at any stage prior to regulatory approval; (iv) the timing of the commencement or end of clinical trials and the availability of clinical data may be delayed or unsuccessful due to challenges caused by the COVID-19 pandemic, regulatory delays, slower than anticipated patient enrollment, manufacturing challenges, changing standards of care, evolving regulatory requirements, clinical trial design, clinical outcomes, competitive factors, or delay or failure in ultimately obtaining regulatory approval in one or more important markets; (v) we may not achieve the expected cost savings we expect from our 2022 corporate restructuring and reorganization plan or our 2023 cost restructuring plan and we may undertake additional restructuring and cost-saving activities in the future, (vi) patents may not issue from our patent applications for our drug candidates, patents that have issued may not be enforceable, or additional intellectual property licenses from third parties may be required; and (vii) certain other important risks and uncertainties set forth in our Annual Report on Form 10-Q filed with the Securities and Exchange Commission on August 9, 2023. Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

 

Contact:

 

For Investors:

 

Vivian Wu of Nektar Therapeutics

628-895-0661

 

For Media:

 

David Rosen of Argot Partners

(212) 600-1902

david.rosen@argotpartners.com

 

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NEKTAR THERAPEUTICS

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

 

ASSETS  September 30,
2023
   December 31,
2022(1)
Current assets:          
Cash and cash equivalents  $64,921   $88,227 
Short-term investments   307,737    416,750 
Accounts receivable   2,204    5,981 
Inventory, net   15,130    19,202 
Other current assets   9,033    15,808 
Total current assets   399,025    545,968 
           
Property, plant and equipment, net   19,949    32,451 
Operating lease right-of-use assets   18,747    53,435 
Goodwill   -    76,501 
Other assets   4,523    2,245 
Total assets  $442,244   $710,600 
           
LIABILITIES AND STOCKHOLDERS' EQUITY          
           
Current liabilities:          
Accounts payable  $3,288   $12,980 
Accrued expenses   29,729    36,557 
Operating lease liabilities, current portion   19,095    18,667 
Total current liabilities   52,112    68,204 
           
Operating lease liabilities, less current portion   102,193    112,829 
Liabilities related to the sales of future royalties, net   123,610    155,378 
Other long-term liabilities   4,961    7,551 
Total liabilities   282,876    343,962 
           
Commitments and contingencies          
           
Stockholders' equity:          
Preferred stock   -    - 
Common stock   19    19 
Capital in excess of par value   3,600,871    3,574,719 
Accumulated other comprehensive loss   (6,352)   (6,907)
Accumulated deficit   (3,435,170)   (3,201,193)
Total stockholders' equity   159,368    366,638 
Total liabilities and stockholders' equity  $442,244   $710,600 

 

(1)The consolidated balance sheet at December 31, 2022 has been derived from the audited financial statements at that date but does not include all of the information and notes required by generally accepted accounting principles in the United States for complete financial statements.

 

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NEKTAR THERAPEUTICS

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share information)

(Unaudited)

 

   Three months ended
September 30,
   Nine months ended
September 30,
 
   2023   2022   2023   2022 
                 
Revenue:                
Product sales  $5,822   $4,969   $15,198   $15,969 
Non-cash royalty revenue related to the sales of future royalties   18,167    18,342    50,860    52,167 
License, collaboration and other revenue   155    314    179    1,896 
Total revenue   24,144    23,625    66,237    70,032 
                     
Operating costs and expenses:                    
Cost of goods sold   12,431    4,972    26,485    15,402 
Research and development   24,070    33,590    84,220    183,583 
General and administrative   21,147    22,534    60,097    70,394 
Restructuring, impairment, and costs of terminated program   11,360    16,830    49,107    124,350 
Impairment of goodwill   -    -    76,501    - 
Total operating costs and expenses   69,008    77,926    296,410    393,729 
Loss from operations   (44,864)   (54,301)   (230,173)   (323,697)
                     
Non-operating income (expense):                    
Change in fair value of development derivative liability   -    -    -    33,427 
Non-cash interest expense on liabilities related to the sales of future royalties   (5,910)   (6,953)   (18,467)   (21,710)
Interest income and other income (expense), net   4,876    2,050    14,492    3,541 
Total non-operating income (expense), net   (1,034)   (4,903)   (3,975)   15,258 
                     
Loss before provision for income taxes   (45,898)   (59,204)   (234,148)   (308,439)
                     
Provision (benefit) for income taxes   (61)   (155)   (171)   71 
Net loss  $(45,837)  $(59,049)  $(233,977)  $(308,510)
                     
                     
Basic and diluted net loss per share  $(0.24)  $(0.31)  $(1.23)  $(1.65)
Weighted average shares outstanding used in computing basic and diluted net loss per share   190,406    187,641    189,651    186,767 

 

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