Alector, Inc. (ALEC) Bundle
A Brief History of Alector, Inc.
Company Overview
Alector, Inc. is a clinical-stage biotechnology company focused on developing therapies for neurodegenerative diseases. Founded in 2013, the company has established partnerships with industry leaders such as AbbVie and GSK to advance its therapeutic candidates.
Financial Performance
As of September 30, 2024, Alector reported collaboration revenue of $46.3 million for the nine months ended, a significant decrease from $81.9 million in the same period of the previous year. This decline of $35.6 million was primarily attributed to a decrease in revenue recognized for its AL101 and AL002 programs.
| Financial Metrics | 2024 (9 months) | 2023 (9 months) |
|---|---|---|
| Collaboration Revenue | $46.3 million | $81.9 million |
| Research and Development Expenses | $139.5 million | $144.4 million |
| General and Administrative Expenses | $44.6 million | $41.8 million |
| Total Operating Expenses | $184.1 million | $186.2 million |
| Net Loss | $(116.9) million | $(85.4) million |
Operating Losses
For the nine months ended September 30, 2024, Alector reported a loss from operations of $137.7 million, compared to a loss of $104.3 million in the same period in 2023. The increase in losses is attributed to ongoing investments in research and development, despite a slight reduction in overall operating expenses.
Cash Flow Analysis
Cash used in operating activities was $174.9 million for the nine months ended September 30, 2024, compared to $138.1 million for the same period in 2023. This increase was primarily due to the higher net loss and changes in working capital.
| Cash Flow Metrics | 2024 (9 months) | 2023 (9 months) |
|---|---|---|
| Cash Used in Operating Activities | $(174.9) million | $(138.1) million |
| Cash Provided by Investing Activities | $65.7 million | $83.8 million |
| Cash Provided by Financing Activities | $71.8 million | $2.0 million |
Funding and Capital Structure
As of September 30, 2024, Alector had $457.2 million in cash, cash equivalents, and marketable securities, down from $621.8 million at the end of 2023. The company anticipates that its available capital will support operations through 2026.
Partnerships and Collaborations
Alector has significant collaboration agreements with AbbVie and GSK. The GSK agreement included upfront payments totaling $700 million, with potential milestone payments reaching up to $1.5 billion. For the nine months ended September 30, 2024, collaboration revenue from GSK was $28.8 million, a decrease from $56.8 million in 2023.
| Collaboration Revenue | GSK (2024) | GSK (2023) | AbbVie (2024) | AbbVie (2023) |
|---|---|---|---|---|
| Collaboration Revenue | $28.8 million | $56.8 million | $17.5 million | $25.0 million |
Future Outlook
Alector continues to face challenges typical of clinical-stage biotechnology companies, including the need for substantial ongoing funding to support research and development activities. The company has indicated plans to seek additional financing and expects to continue incurring losses as it advances its product candidates.
A Who Owns Alector, Inc. (ALEC)
Shareholder Composition
As of September 30, 2024, Alector, Inc. (ALEC) had a total of 97,929,897 shares issued and outstanding. The following table outlines the major shareholders and their respective ownership percentages:
| Shareholder | Shares Owned | Ownership Percentage |
|---|---|---|
| Institutional Investors | Approximately 66,000,000 | 67.4% |
| Insider Ownership | Approximately 5,000,000 | 5.1% |
| Public Float | Approximately 26,929,897 | 27.5% |
Institutional Ownership
Institutional investors hold a significant portion of Alector's shares. The largest institutional shareholders include:
- Vanguard Group: 10,000,000 shares
- BlackRock: 8,000,000 shares
- Fidelity Investments: 6,000,000 shares
- Other Institutions: 42,000,000 shares
Insider Ownership
Insider ownership includes executives and board members who hold shares of the company:
- CEO: 1,500,000 shares
- COO: 1,000,000 shares
- Board Members: 2,500,000 shares
Recent Stock Performance
The stock price of Alector as of September 30, 2024, was $6.57, following a public offering that raised approximately $71.1 million. The company has seen fluctuations in its market capitalization, which was around $642 million during the latest reporting period.
Financial Overview
Alector reported total assets of $516.0 million and total liabilities of $397.1 million as of September 30, 2024. The company has an accumulated deficit of $827.1 million, reflecting its ongoing investment in research and development.
Collaboration Agreements
Alector has entered into significant collaboration agreements with major pharmaceutical companies, contributing to its financial stability:
- GSK Agreement: Upfront payments totaling $700 million with potential milestones up to $1.5 billion.
- AbbVie Agreement: Upfront payment of $205 million, with additional milestone payments and royalties.
Net Loss and Revenue
For the nine months ended September 30, 2024, Alector reported a net loss of $116.975 million, with collaboration revenue of $46.318 million.
Market Outlook
The market outlook for Alector remains focused on advancing its clinical programs, with expectations of increased revenue from collaboration agreements as clinical trials progress.
Alector, Inc. (ALEC) Mission Statement
Company Overview
Alector, Inc. is a clinical-stage biotechnology company based in South San Francisco, California. The company focuses on pioneering immuno-neurology, a novel therapeutic approach aimed at treating neurodegenerative diseases.
Mission Statement
Alector aims to advance the treatment of neurodegeneration through innovative therapies that harness the immune system. The company is committed to discovering, developing, and delivering transformative medicines to patients.
Financial Overview
As of September 30, 2024, Alector reported significant financial metrics relevant to its operations and future prospects. The following table summarizes key financial data:
| Financial Metric | Value (in thousands) |
|---|---|
| Collaboration Revenue (Q3 2024) | $15,342 |
| Collaboration Revenue (YTD 2024) | $46,318 |
| Research and Development Expenses (Q3 2024) | $47,998 |
| Research and Development Expenses (YTD 2024) | $139,479 |
| General and Administrative Expenses (Q3 2024) | $15,778 |
| General and Administrative Expenses (YTD 2024) | $44,587 |
| Net Loss (Q3 2024) | $(42,220) |
| Net Loss (YTD 2024) | $(116,975) |
| Cash, Cash Equivalents, and Marketable Securities | $457,200 |
| Accumulated Deficit | $(827,053) |
Key Collaborations
Alector has significant collaboration agreements with major pharmaceutical companies, including AbbVie and GSK. These collaborations provide both financial support and strategic partnerships for advancing their clinical programs.
- GSK Agreement: Upfront payments totaling $700 million, with potential additional milestone payments of up to $1.5 billion.
- AbbVie Agreement: Upfront payments of $205 million, including milestone payments tied to clinical progress.
Research and Development Initiatives
The company's focus on research and development is evident in its substantial investments, which are essential for progressing its pipeline of candidate therapies.
| Program | Direct R&D Expenses (YTD 2024) |
|---|---|
| Latozinemab | $10,817 |
| AL101 | $3,751 |
| AL002 | $39,513 |
| Other Programs | $12,451 |
Future Outlook
Alector anticipates that its existing cash and marketable securities will provide sufficient runway to support operations through 2026. The company continues to prioritize late-stage programs and is focused on advancing its research and development efforts.
How Alector, Inc. (ALEC) Works
Business Overview
Alector, Inc. is a clinical-stage biotechnology company focused on developing therapies for neurodegenerative diseases. The company's operations are primarily financed through collaborations with major pharmaceutical companies such as AbbVie and GSK. As of September 30, 2024, Alector had an accumulated deficit of $827.1 million and reported a net loss of $116.975 million for the nine months ended September 30, 2024.
Financial Performance
In the nine months ended September 30, 2024, Alector generated collaboration revenue of $46.3 million, compared to $81.9 million for the same period in 2023, marking a decrease of $35.6 million. The decrease was primarily driven by a reduction in revenue recognized for the AL101 and AL002 programs due to contract modifications and changes in project costs.
| Financial Metrics | 2024 (9 months) | 2023 (9 months) | Change |
|---|---|---|---|
| Collaboration Revenue | $46.3 million | $81.9 million | -$35.6 million |
| Research and Development Expenses | $139.5 million | $144.4 million | -$4.9 million |
| General and Administrative Expenses | $44.6 million | $41.8 million | +$2.8 million |
| Total Operating Expenses | $184.1 million | $186.2 million | -$2.1 million |
| Net Loss | -$116.975 million | -$88.957 million | -$28.018 million |
Research and Development (R&D)
Alector's R&D expenses were $139.5 million for the nine months ended September 30, 2024, reflecting a strategic focus on late-stage programs. The company initiated the PROGRESS-AD Phase 2 clinical trial for AL101 in 2024, contributing to increased expenses.
Collaboration Agreements
Alector has significant collaboration agreements with AbbVie and GSK. Under the GSK Agreement, Alector received $700 million in upfront payments and is eligible for up to $1.5 billion in milestone payments. For the nine months ended September 30, 2024, collaboration revenue from GSK was $28.8 million.
Stockholder Equity and Financing
As of September 30, 2024, Alector had total stockholders' equity of $118.933 million, with cash, cash equivalents, and marketable securities amounting to $457.2 million. The company completed a public offering in January 2024, raising approximately $71.1 million.
Liquidity and Future Funding
Alector's cash flow for the nine months ended September 30, 2024, showed cash used in operating activities of $174.877 million. The company anticipates that its existing resources will support its operations through 2026, but additional financing will be necessary to continue its R&D efforts.
Market Outlook
The biotechnology sector is rapidly evolving, and Alector's focus on neurodegenerative diseases positions it in a critical area of medical need. However, the company has yet to commercialize any products and does not expect to generate revenue from product sales in the near term.
How Alector, Inc. (ALEC) Makes Money
Revenue Streams
Alector, Inc. primarily generates revenue through collaboration agreements with major pharmaceutical companies, particularly AbbVie and GSK. As of September 30, 2024, Alector reported collaboration revenue of $46.3 million for the nine months ending on that date, a decrease from $81.9 million in the same period of 2023.
| Revenue Type | 2024 (9 months) | 2023 (9 months) | Change |
|---|---|---|---|
| Collaboration Revenue | $46.3 million | $81.9 million | $(35.6 million) |
The decrease was mainly attributed to a reduction in revenue recognized for the AL101 and AL002 programs, primarily due to contract modifications and adjustments in expected costs.
Collaboration Agreements
Under the terms of the GSK Agreement, Alector received $700 million in upfront payments, with potential for up to $1.5 billion in milestone payments related to clinical development and commercialization of their products, including latozinemab and AL101. The revenue from these agreements is recognized as costs are incurred for the respective programs.
For the AbbVie Agreement, Alector has received significant upfront payments and is entitled to milestone payments as the AL002 program progresses. The collaboration revenue recognized from AbbVie for the nine months ended September 30, 2024, was $17.5 million, down from $25.0 million in 2023.
Operating Expenses
Alector's operating expenses are primarily driven by research and development (R&D) costs. For the nine months ended September 30, 2024, total operating expenses were $184.1 million, slightly down from $186.2 million in the same period of 2023.
| Expense Type | 2024 (9 months) | 2023 (9 months) | Change |
|---|---|---|---|
| Research and Development | $139.5 million | $144.4 million | $(4.9 million) |
| General and Administrative | $44.6 million | $41.8 million | +$2.8 million | Total Operating Expenses | $184.1 million | $186.2 million | $(2.1 million) |
The R&D expenses reflect Alector's commitment to advancing its product candidates through clinical trials, with significant expenditures on the AL101 and AL002 programs. General and administrative expenses increased primarily due to impairments and operational transitions.
Net Loss and Financial Position
Alector has been operating at a net loss, which was $117.0 million for the nine months ended September 30, 2024, compared to a net loss of $89.0 million for the same period in 2023.
| Period | Net Loss |
|---|---|
| 2024 (9 months) | $(117.0 million) |
| 2023 (9 months) | $(89.0 million) |
As of September 30, 2024, Alector had cash, cash equivalents, and marketable securities totaling $457.2 million, providing sufficient runway for operations through 2026.
Funding and Capital Requirements
Alector's operations have been financed through collaborations and public offerings. In January 2024, the company completed a public offering, raising approximately $71.1 million. The need for additional funding remains, primarily for R&D activities and operational costs.
The company has an accumulated deficit of $827.1 million as of September 30, 2024, reflecting its ongoing investment in product development without generating product sales revenue.
Future Prospects
Alector does not expect to generate revenue from product sales in the immediate future, as it continues to focus on clinical trials and regulatory approvals. The success of its collaborations and the eventual commercialization of its product candidates will be crucial for its financial sustainability.
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Resources:
- Alector, Inc. (ALEC) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Alector, Inc. (ALEC)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Alector, Inc. (ALEC)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.