Genocea Reports Third Quarter 2015 Financial Results

– Company Reports Recent Milestones and Announces Expansion of ATLASTM
Technology into Immuno-Oncology –

– Conference Call and Webcast Scheduled for 9:00 a.m. ET Today –

CAMBRIDGE, Mass.–(BUSINESS WIRE)–Genocea Biosciences, Inc. (NASDAQ:GNCA), a biopharmaceutical company
developing T cell-directed vaccines and immunotherapies, today reported
recent corporate highlights and financial results for the third quarter
ended September 30, 2015.

“In early October, we reported positive six-month durability data for
GEN-003 which further support its potential to serve as a cornerstone
therapy for genital herpes infections with convenient, long-term disease
control. We look forward to reporting 12-month data from this ongoing
trial in the first quarter of 2016 and to our end of Phase 2 meeting
with the FDA later next year,” said Chip Clark, president and chief
executive officer of Genocea. “Additionally, we are excited to report
several recent milestones as part of the expansion of our ATLAS
technology into oncology, following encouraging data from our ongoing
collaboration with the Dana-Farber Cancer Institute. Having demonstrated
its power in infectious disease, we believe that ATLAS is positioned to
enable smarter identification of cancer vaccine antigens and smarter
immuno-oncology response profiling to optimize patient care.”

Business Highlights and Anticipated Milestones

GEN-003 – Immunotherapy for treatment of genital herpes in Phase 2
development. Greater than $1 billion potential revenue opportunity in
the U.S.

  • Reported positive results six months after dosing from ongoing
    Phase 2 dose optimization trial
  • 12-month data expected in the first quarter of 2016
  • End of Phase 2 meeting with U.S. Food and Drug Administration
    expected in late 2016

On October 7, 2015, Genocea reported positive results from a planned
interim analysis of data collected six months after dosing from its
ongoing Phase 2 dose optimization trial evaluating GEN-003 for the
treatment of genital herpes. At its best performing dose of 60 µg per
protein / 75 µg of Matrix-M2TM adjuvant, GEN-003 demonstrated
a statistically significant 58 percent reduction from baseline in the
viral shedding rate (p<0.0001), the primary endpoint of the study and a
measure of anti-viral activity.

In a planned secondary analysis to assess the impact on genital lesion
rates, GEN-003 demonstrated sustained and statistically significant
reductions from baseline in five of six dose groups ranging from 43 to
69 percent. In addition, the proportion of patients receiving GEN-003
who were lesion-free at six months after dosing ranged from
approximately 30 to 50 percent, similar to results reported in Phase 3
clinical trials with oral antiviral therapies. A further secondary
analysis measuring the time to first recurrence after completion of
dosing showed a range of 152 days to greater than 180 days among dose
groups. The Phase 2 trial continues to show that GEN-003 is safe and
well tolerated by patients, with no serious adverse events related to
the vaccine.

GEN-004 – Vaccine for the prevention of infections by all
serotypes of pneumococcus.

  • Reported top-line results from Phase 2a clinical trial in October
  • Development suspended pending review of potential paths forward

On October 19, 2015, Genocea reported that top-line results from a Phase
2a clinical trial for GEN-004 showed consistent reductions versus
placebo in the pre-specified endpoints of the rate and density of
colonization, but neither of the endpoints achieved statistical
significance. GEN-004 was safe and well tolerated by patients. Genocea
has suspended development in GEN-004 pending further review of the data
and expert consultation.

ATLAS technology platform – Expansion into immuno-oncology

  • Results from Dana-Farber collaboration to be presented at SITC
    on November 6; collaboration ongoing
  • New collaboration with Memorial Sloan Kettering Cancer Center
    announced today
  • ATLAS’s ability to identify T cell antigens may unlock new
    cancer vaccines
  • Immunotherapy program initiated targeting Epstein-Barr Virus

Genocea was founded to create T cell-directed immunotherapies and
vaccines using ATLAS, a unique platform for profiling large and diverse
patient populations to find the T cell antigens driving protective
responses. The Company believes that data reported to date for GEN-003
represents the first evidence of efficacy by an immunotherapy built
around new T cell targets for an infectious disease. Building on the
success of ATLAS in genital herpes, Genocea initiated a research
collaboration with Dana-Farber in 2014 to apply ATLAS in
immuno-oncology. This collaboration centered on the potential of ATLAS
to identify patterns of T cell response in cancer patients receiving
checkpoint inhibitor therapy.

ATLAS makes no assumptions about which cancer antigens are meaningful
and which are not. It instead takes a panoramic view of a large, diverse
population of human subjects and reveals clinically relevant T cell
antigens of protective responses. In contrast to other high-throughput
predictive tools currently being applied in oncology drug discovery,
Genocea believes that ATLAShas a number of critical
benefits, including that it potentially:

  • Can find antigens to which patients are actually responding;
  • Can distinguish between clinically relevant and immuno-dominant
    responses;
  • Can identify separately targets of CD4+ and CD8+
    T cells;
  • Is not HLA-limited.

These benefits may enable smarter identification of cancer antigens for
cancer vaccines and smarter identification of patients best suited to
immuno-oncology therapy or therapy combinations.

Dana-Farber Collaboration

In this pilot study, funded by the Ludwig Trust, Genocea partnered with
Darren Higgins, Ph.D., professor of microbiology and immunobiology at
Harvard Medical School and F. Stephen Hodi, Jr., M.D., director of the
Melanoma Center at Dana-Farber Cancer Institute, to conduct a
retrospective analysis of 10 checkpoint inhibitor (CPI) treated
patients’ T cell responses to 23 known tumor-associated antigens. By
analyzing the immune responses of both responders and non-responders to
CPI therapy, ATLAS successfully identified the cancer antigens to which
either (or both) CD4+ or CD8+ T cells became
activated. Although this research was not powered to draw firm
conclusions, the analysis of T cell responses in patients receiving CPI
therapy revealed a pattern indicating a greater breadth of T cell
activation for responders than non-responders. The study also revealed
preliminary evidence that different characteristics of T cell responses
emerge when comparing patients who respond and those who do not. Some T
cell responses did not correspond with improved patient outcomes, and
may be classified as “decoys,” further validating the ability of ATLAS
to distinguish clinically relevant targets of T cell responses. This
analysis will be presented as a late-breaker at the Society for
Immunotherapy of Cancer’s (SITC) 30th Anniversary Annual Meeting &
Associated Programs in National Harbor, Maryland. The poster, #342,
entitled Immunoprofiling of T cell responses in melanoma patients
undergoing CPI therapy
, will be presented on Saturday, November 7,
2015 between 12.30 – 2:00p.m. ET.

The collaboration with Dana-Farber is ongoing as Genocea continues to
analyze more blood samples to characterize T cell response profiles that
may be prognostic of CPI efficacy, and to identify T cell antigens that
may be included in novel immunotherapies.

Memorial Sloan Kettering Cancer Center Collaboration

The Company today announced a collaboration with Memorial Sloan
Kettering Cancer Center to screen the T cell responses of melanoma and
non-small cell lung cancer patients treated with checkpoint inhibitors
against the complete repertoire of patient-specific putative cancer
neoantigens.

The goals of the collaboration are to identify signatures of T cell
response in cancer patients associated with response or non-response to
CPI therapy and to discover new T cell cancer vaccine antigens. ATLAS
will be used in conjunction with Memorial Sloan Kettering’s
patient-specific cancer neoantigen sequences and blood samples from the
same cancer patients. This new collaborative work will be led by
investigators Timothy A. Chan, M.D., Ph.D., Vice Chair, Department of
Radiation Oncology, and Jedd D. Wolchok, M.D., Ph.D., Chief of Melanoma
and Immunotherapeutics Service, Department of Medicine and Ludwig Center.

Epstein-Barr Virus Immunotherapy Program Initiated

Genocea has commenced a new program focused on Epstein-Barr Virus (EBV).
EBV infection has been linked to cancers with high unmet needs such as
non-Hodgkin’s lymphoma, nasopharyngeal carcinoma and gastric carcinoma.
We believe the ATLASplatform is highly suited to the
creation of a new immunotherapy for EBV given that T cell responses are
understood to be crucial for protection against EBV. Furthermore, EBV is
part of the herpesvirus family, in which Genocea has deep experience
through its development of GEN-003.

Completed $50 million public offering in August 2015.

  • Funding expected to be sufficient to complete GEN-003 Phase 2
    program
  • Strengthened balance sheet provides foundation for ongoing
    business development activities

In August 2015, Genocea closed a public offering of 3,850,000 shares of
common stock. Gross and net proceeds to Genocea from this offering were
approximately $50 million and $47 million, respectively.

Third Quarter 2015 Financial Results &
Financial Guidance

  • Cash Position: Cash, cash equivalents and investments as
    of September 30, 2015 were $112.5 million, compared to $74.6
    million as of June 30, 2015. Genocea expects that these funds will be
    sufficient to fund its operating expenses and capital expenditure
    requirements into the second half of 2017.
  • Research and Development (R&D) Expenses: R&D expenses for
    the quarter ended September 30, 2015 were unchanged at $6.1 million
    compared to the same period in 2014, reflecting higher personnel costs
    and increased lab-related costs offset by reductions in manufacturing
    and licensing fees related to the commencement of GEN-003 and GEN-004
    clinical trials. We continue to make investments in Genocea’s
    preclinical pipeline, which offset lower R&D expense for our GEN-003
    and GEN-004 programs on a quarter over quarter basis.
  • General and Administrative (G&A) Expenses: G&A expenses for
    the quarter ended September 30, 2015 were $3.6 million, compared
    to $2.8 million for the same period in 2014. The increase reflects
    higher personnel costs and depreciation expense, both of which support
    Genocea’s expanding R&D operations and the demands of operating as a
    public company.
  • Net Loss: Net loss was $9.8 million for the third quarter of
    2015, compared to a net loss of $9.2 million for the same period in
    2014.

Conference Call

Genocea will host a conference call and webcast today at 9:00 a.m. ET.
The conference call may be accessed by dialing (844) 826-0619 for
domestic participants and (315) 625-6883 for international callers and
referencing the conference ID number 60192429. A live webcast of the
conference call will be available online from the investor relations
section of the Company’s website at http://ir.genocea.com.
A webcast replay of the conference call will be available on the Genocea
website beginning approximately two hours after the event, and will be
archived for 30 days.

About Genocea

Genocea is harnessing the power of T cell immunity to develop
life-changing vaccines and immunotherapies. T cells are increasingly
recognized as a critical element of protective immune responses to a
wide range of diseases, but traditional discovery methods have proven
unable to identify the targets of such protective immune response. Using
ATLAS, its proprietary technology platform, Genocea identifies these
targets to potentially enable the rapid development of medicines to
address critical patient needs. Genocea’s pipeline of novel clinical
stage T cell-enabled product candidates includes GEN-003 for genital
herpes, GEN-004 for the prevention of infection by all serotypes of
pneumococcus, and earlier-stage programs in chlamydia, genital herpes
prophylaxis, malaria and cancer immunotherapy. For more information,
please visit the company’s website at www.genocea.com.

Forward Looking Statements

Statements herein relating to future business performance, conditions
or strategies and other financial and business matters, including
expectations regarding clinical developments, are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act. Genocea cautions that these forward-looking statements are
subject to numerous assumptions, risks and uncertainties, which change
over time. Factors that may cause actual results to differ materially

from the results discussed in the forward-looking statements or
historical experience include risks and uncertainties, including
Genocea’s ability to progress any product candidates in preclinical or
clinical trials; the ability of ATLAS to identify promising product
candidates in oncology; the scope, rate and progress of its preclinical
studies and clinical trials and other research and development
activities; anticipated clinical trial results; current results may not
be predictive of future results; even if the data from preclinical
studies or clinical trials is positive, regulatory authorities may
require additional studies for approval and the product may not prove to
be safe and efficacious; Genocea’s ability to enter into future
collaborations with industry partners and the government and the terms,
timing and success of any such collaboration; risks associated with the
manufacture and supply of clinical and commercial product; the cost of
filing, prosecuting, defending and enforcing any patent claims and other
intellectual property rights; Genocea’s ability to obtain rights to
technology; competition for clinical resources and patient enrollment
from drug candidates in development by other companies with greater
resources and visibility; the rate of cash utilized by Genocea in its
business and the period for which existing cash will be able to fund
such operation; Genocea’s
ability to obtain adequate financing in
the future through product licensing, co-promotional arrangements,
public or private equity or debt financing or otherwise; general
business conditions; competition; business abilities and judgment of
personnel; the availability of qualified personnel and other factors set
forth under “Risk Factors” in Genocea’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2014 and other filings with the
Securities and Exchange Commission (the “SEC”). Further information on
the factors and risks that could affect Genocea’s business, financial
conditions and results of operations is contained in Genocea’s filings
with the SEC, which are available at www.sec.gov.
These forward-looking statements speak only as of the date of this press
release and Genocea assumes no duty to update forward-looking statements

GENOCEA BIOSCIENCES, INC.
CONDENSED BALANCE SHEETS (UNAUDITED)
(In thousands)
 
      September 30,       December 31,
  2015 2014*
 
Cash, cash equivalents and investments $ 112,545 $ 47,079
Other assets   5,335   3,253
Total assets $ 117,880 $ 50,332
 
Debt, current and long-term $ 11,658 $ 11,389
Accounts payable 1,731 2,692
Accrued expenses 4,928 2,486
Other liabilities   678   1,258
Total liabilities 18,995 17,825
Stockholders’ equity   98,885   32,507
Total liabilities and stockholders’ equity $ 117,880 $ 50,332

* Includes $99 thousand in deferred financing costs reclassified from
Other assets to Debt upon the adoption of a recently issued accounting
pronouncement during the second quarter of 2015, which required
retrospective application.

GENOCEA BIOSCIENCES, INC.
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands, except per share amounts)
 
      Three months ended

September 30,

      Nine months ended

September 30,

2015       2014 2015       2014
 
Grant revenue $ 213 $ – $ 449 $ –
Operating expenses:
Research and development 6,058 6,115 21,536 15,073
General and administrative 3,645 2,843 10,206 7,167
Total operating expenses 9,703 8,958 31,742 22,240
Loss from operations (9,490) (8,958) (31,293) (22,240)
Other expense, net (281) (213) (876) (1,406)
Net loss $ (9,771) $ (9,171) $ (32,169) $ (23,646)
 
Accretion of redeemable convertible preferred stock to redemption
value
(180)
Net loss attributable to common stockholders $ (9,771) $ (9,171) $ (32,169) $ (23,826)
Net loss per share attributable to common stockholders – basic and
diluted
$ (0.37) $ (0.53) $ (1.38) $ (1.60)
Weighted-average number of common shares used in net loss per share
attributable to common stockholders – basic and diluted
26,610 17,465 23,228 14,918

.

Contacts

For media:
Spectrum Science Communications
Megan
Lustig, 202-955-6222
mlustig@spectrumscience.com
or
For
investors:

Genocea Biosciences
Jonathan Poole, 617-876-8191
jonathan.poole@genocea.com