Aadi Bioscience, Inc. (AADI): Business Model Canvas [11-2024 Updated]

Understanding the business model of Aadi Bioscience, Inc. (AADI) reveals how this innovative biotech company is tackling the complexities of cancer treatment. With a focus on precision therapies and a unique formulation that combines nab technology with sirolimus, AADI is positioning itself as a leader in the treatment of rare cancers like advanced malignant PEComa. Dive deeper into the intricacies of their Key Partnerships, Value Propositions, and more to uncover how AADI is reshaping cancer care.

Aadi Bioscience, Inc. (AADI) - Business Model: Key Partnerships

Collaborations with contract research organizations (CROs)

Aadi Bioscience collaborates with various CROs to facilitate clinical trials and research activities. These partnerships are essential for managing the complexities of clinical development, particularly given the company's focus on specialized cancer therapies. For instance, Aadi has engaged CROs for conducting clinical trials for FYARRO, which is critical for its development pipeline. The costs associated with these collaborations are reflected in the research and development expenses, which totaled $36.7 million for the nine months ended September 30, 2024.

Partnerships with healthcare providers

Aadi's strategy includes building partnerships with healthcare providers to enhance the distribution and administration of its therapies, particularly FYARRO. This approach allows Aadi to gain insights into patient needs and treatment outcomes, fostering a collaborative environment that can improve patient care. As of September 30, 2024, net product sales from FYARRO amounted to $18.7 million for the nine months, indicating a growing acceptance and utilization among healthcare providers.

Licensing agreements for drug development

Aadi has entered into significant licensing agreements that bolster its drug development capabilities. One notable agreement is with Bristol-Myers Squibb Company (BMS), which includes exclusive rights to certain patents and technologies related to FYARRO. Under this agreement, Aadi is obligated to pay royalties based on net sales. For the three months ended September 30, 2024, royalties paid to BMS totaled $0.5 million, while for the nine months, they reached $1.4 million. Additionally, Aadi received $14.0 million in non-refundable upfront consideration from EOC Pharma for rights to develop and commercialize FYARRO in specified regions.

Alliances with pharmaceutical companies for distribution

Aadi has formed strategic alliances with pharmaceutical companies to facilitate the distribution of its products. These partnerships are crucial for expanding market reach and ensuring that FYARRO is accessible to patients who need it. The company has focused on specialty distributors and pharmacies, which are key players in the distribution of oncology products. The distribution channels established through these alliances have contributed to Aadi's revenue, with total revenue for the nine months ending September 30, 2024, reported at $18.7 million.

Key Partnership	Description	Financial Impact
Contract Research Organizations (CROs)	Facilitate clinical trials for drug development	R&D expenses of $36.7 million (9M 2024)
Healthcare Providers	Enhance treatment distribution and patient care	Net product sales of $18.7 million (9M 2024)
Bristol-Myers Squibb (BMS)	Exclusive rights to patents and technologies	Royalties of $1.4 million (9M 2024)
EOC Pharma	Licensing for development in Asia	Received $14.0 million upfront payment
Pharmaceutical Alliances	Distribute oncology products effectively	Total revenue of $18.7 million (9M 2024)

Aadi Bioscience, Inc. (AADI) - Business Model: Key Activities

Research and development of cancer therapies

Aadi Bioscience, Inc. is primarily focused on the research and development of precision therapies for cancers with alterations in the mTOR pathway. The company has historically devoted a significant portion of its resources to R&D activities, with R&D expenses amounting to $36.7 million for the nine months ended September 30, 2024, compared to $36.2 million in the same period in 2023. This ongoing investment is essential for the development of their lead product, FYARRO, as well as for future product candidates.

Clinical trials for product candidates

Aadi is actively engaged in clinical trials to evaluate the safety and efficacy of its therapies. The company halted the PRECISION1 trial in August 2024 due to interim data indicating it was unlikely to meet efficacy thresholds necessary for accelerated approval. Despite this, Aadi continues dosing previously enrolled patients in two ongoing Phase 2 trials for advanced endometrioid-type endometrial cancer (EEC) and neuroendocrine tumors (NETs), having enrolled 24 and 12 patients respectively.

Clinical Trials	Indication	Status	Enrolled Patients
PRECISION1	Tuberous Sclerosis Complex 1 and 2	Paused	Not applicable
Phase 2 Trial 1	Advanced EEC	Ongoing	24
Phase 2 Trial 2	NETs	Ongoing	12

Regulatory submissions and compliance

Aadi Bioscience's operations include navigating the complex landscape of regulatory submissions. The company received FDA approval for FYARRO in November 2021. Regulatory compliance remains a key activity as they seek to expand indications and market their product in additional jurisdictions. As of September 30, 2024, the company has incurred a total accumulated deficit of $314.4 million, primarily due to costs associated with R&D and compliance.

Marketing and commercialization of FYARRO

Following the launch of FYARRO, Aadi has recognized product sales amounting to $7.2 million for the three months ended September 30, 2024, and $18.7 million for the nine months ended September 30, 2024. The marketing strategy includes targeting specialty pharmacies and distributors to maximize reach within the oncology market. Aadi's ongoing efforts to commercialize FYARRO are supported by a dedicated sales and marketing infrastructure designed to educate healthcare providers and payors about the product's benefits.

FYARRO Sales Performance	Q3 2024	Q3 2023	YTD 2024	YTD 2023
Net Product Sales	$7.2 million	$5.9 million	$18.7 million	$18.0 million

Aadi Bioscience, Inc. (AADI) - Business Model: Key Resources

Intellectual Property Portfolio, Including Patents

Aadi Bioscience has established a significant intellectual property portfolio. This includes exclusive rights for certain patents and a non-exclusive license related to its lead drug product, FYARRO (nab-sirolimus). The BMS License Agreement, which was amended and restated, includes provisions for milestone payments and royalties on net sales from licensed products. As of September 30, 2024, Aadi reported royalties on net product sales under this agreement amounting to $0.5 million for the three months ended September 30, 2024, and $1.4 million for the nine months ended September 30, 2024.

Expertise in mTOR Pathway Research

Aadi specializes in developing therapies targeting the mTOR (mammalian target of rapamycin) pathway, which is critical for cell growth and cancer progression. The company's lead product FYARRO has demonstrated efficacy in treating advanced malignant PEComa, a rare cancer. The FDA approved FYARRO in November 2021, and it was launched on February 22, 2022.

Financial Resources for Ongoing Operations

As of September 30, 2024, Aadi Bioscience had cash, cash equivalents, and short-term investments totaling $62.6 million. This financial position is expected to support operations into the second half of 2026. However, the company has recorded accumulated losses amounting to $314.4 million since its inception.

Financial Metrics	As of September 30, 2024
Cash and Cash Equivalents	$30.5 million
Short-Term Investments	$32.1 million
Net Loss (Q3 2024)	$12.5 million
Accumulated Deficit	$314.4 million

Manufacturing Capabilities for Drug Production

Aadi Bioscience has developed manufacturing capabilities essential for producing its drug products. The cost of goods sold for the three months ended September 30, 2024, was $0.8 million, an increase from $0.7 million during the same period in 2023. This increase is primarily attributed to the costs associated with the sales and preparation of FYARRO.

Manufacturing Metrics	Q3 2024	Q3 2023
Cost of Goods Sold	$0.8 million	$0.7 million
Total Revenue (Product Sales)	$7.2 million	$6.0 million

Aadi Bioscience, Inc. (AADI) - Business Model: Value Propositions

Precision therapies targeting specific cancer types

Aadi Bioscience specializes in precision therapies aimed at specific cancer types, particularly advanced malignant PEComa. The FDA approved their product, FYARRO, in November 2021, which was subsequently launched in February 2022. As of September 30, 2024, net product sales amounted to $7.2 million for the quarter and $18.7 million year-to-date.

Unique formulation combining nab technology and sirolimus

FYARRO is a unique formulation that combines nanoparticle albumin-bound (nab) technology with sirolimus, a known immunosuppressant. This combination enhances the delivery and efficacy of the treatment specifically for patients with PEComa, a rare cancer. The formulation is designed to improve absorption and bioavailability, which may lead to better patient outcomes.

Potential for improved patient outcomes in rare cancers

The potential for improved patient outcomes is significant, especially given the limited treatment options available for rare cancers like PEComa. Aadi's targeted therapy aims to provide a therapeutic benefit where few alternatives exist. The company continues to monitor and evaluate patient responses, with the hope of expanding indications for FYARRO.

First-mover advantage in the PEComa treatment market

Aadi holds a first-mover advantage in the treatment of PEComa, as FYARRO is currently the only approved therapy for this indication. This exclusivity allows Aadi to establish a strong market presence and brand recognition among healthcare professionals treating rare cancers. The company is actively working to capitalize on this advantage to drive further adoption and sales.

Key Metrics	Three Months Ended September 30, 2024	Three Months Ended September 30, 2023	Year-to-Date (YTD) 2024	YTD 2023
Net Product Sales	$7.2 million	$5.9 million	$18.7 million	$18.0 million
Operating Expenses	$20.6 million	$23.8 million	$67.3 million	$72.2 million
Net Loss	$(12.5) million	$(16.3) million	$(45.4) million	$(49.5) million
Accumulated Deficit	$314.4 million	$252.7 million (as of September 30, 2023)

Aadi Bioscience, Inc. (AADI) - Business Model: Customer Relationships

Engagement with oncologists and healthcare professionals

Aadi Bioscience actively engages with oncologists and healthcare professionals to promote its lead product, FYARRO. This engagement is crucial for building relationships and ensuring the adoption of its therapies. The company focuses on educating healthcare providers about the clinical benefits of FYARRO, particularly in treating advanced malignant perivascular epithelioid cell tumors (PEComa).

Support programs for patients and caregivers

Aadi offers comprehensive support programs for patients and their caregivers, including financial assistance and educational resources. The company has initiated co-payment assistance programs for commercially insured patients, which are crucial for improving access to treatment. As of September 30, 2024, Aadi had accrued $1.0 million in co-payment assistance, reflecting its commitment to supporting patients financially.

Partnerships with insurance providers for reimbursement

Aadi Bioscience has established partnerships with various insurance providers to facilitate reimbursement for FYARRO. The company recognizes the importance of these partnerships in ensuring that patients have access to the drug without financial barriers. In the nine months ending September 30, 2024, the company reported net product sales of $18.7 million, indicating successful reimbursement strategies and partnerships.

Educational resources on treatment options

Aadi provides educational resources aimed at both healthcare professionals and patients. These resources include detailed information about treatment protocols and the efficacy of FYARRO. The company’s commitment to education is reflected in its outreach efforts, which aim to ensure that both patients and providers are well-informed about available treatment options and their benefits.

Program Type	Description	Financial Commitment (as of Sept 30, 2024)
Co-Payment Assistance	Financial support for patients with commercial insurance	$1.0 million accrued
Oncologist Engagement	Educational programs and materials for healthcare professionals	Not disclosed
Insurance Partnerships	Collaborations to ensure reimbursement for FYARRO	Facilitated $18.7 million in product sales
Patient Education	Resources provided to patients and caregivers on treatment	Not disclosed

Aadi Bioscience, Inc. (AADI) - Business Model: Channels

Direct sales to healthcare institutions

Aadi Bioscience primarily utilizes direct sales strategies to reach healthcare institutions, focusing on hospitals, oncology clinics, and specialized treatment facilities. The company generated net product sales of $7.2 million for the three months ended September 30, 2024, and $18.7 million for the nine-month period ending on the same date. This approach allows Aadi to establish direct relationships with healthcare providers, ensuring that their product FYARRO, a treatment for advanced malignant PEComa, is readily available to patients in need.

Online platforms for patient education

Aadi Bioscience leverages online platforms to provide educational resources for patients and healthcare professionals. These platforms include the company's website and social media channels, which are crucial for disseminating information about FYARRO, treatment options, and ongoing clinical trials. By enhancing patient awareness and understanding, Aadi aims to improve engagement and treatment outcomes. The importance of these platforms is underscored by the increasing trend in digital health engagement, especially in oncology.

Partnerships with specialty pharmacies

Aadi has established partnerships with specialty pharmacies to facilitate access to FYARRO. These pharmacies are essential in managing complex medication regimens and ensuring that patients receive the necessary support for treatment adherence. This channel not only enhances distribution efficiency but also helps in navigating insurance and reimbursement processes, which are critical for patient access. The company recognizes the significant role these partnerships play in reaching a broader patient population and improving overall treatment access.

Participation in oncology conferences and seminars

Aadi actively participates in oncology conferences and seminars to promote FYARRO and engage with the medical community. These events provide a platform for Aadi to showcase clinical data, network with healthcare professionals, and gather insights on market trends. The company’s engagement in these venues reflects its commitment to building relationships within the oncology field and staying abreast of developments that can impact its business model. Such participation is vital for fostering collaborations and enhancing the visibility of Aadi’s offerings among healthcare professionals.

Channel Type	Details	Financial Impact
Direct Sales	Sales to healthcare institutions for FYARRO	$7.2 million (Q3 2024)
Online Platforms	Patient education and engagement	Increased awareness, indirect financial impact
Specialty Pharmacies	Access and distribution of FYARRO	Facilitates patient access, enhances revenue potential
Conferences/Seminars	Networking and promotion within oncology	Potential for increased sales and collaborations

Aadi Bioscience, Inc. (AADI) - Business Model: Customer Segments

Patients with advanced malignant PEComa

Aadi Bioscience focuses on treating patients diagnosed with advanced malignant perivascular epithelioid cell tumor (PEComa). As of September 30, 2024, Aadi reported net product sales of $18.7 million for FYARRO, the drug approved for this indication. The target patient population for FYARRO is relatively small, as PEComa is a rare cancer, which limits the overall market size but allows for a highly specialized focus in treatment.

Oncologists and cancer treatment centers

Aadi's primary healthcare providers include oncologists and specialized cancer treatment centers. The company has built a commercial team that works closely with these providers to ensure the effective distribution of FYARRO. As of the latest reports, Aadi has engaged specialty distributors and pharmacies to facilitate access to their product.

Payers and insurance companies

Third-party payers, including insurance companies and government health programs, play a crucial role in Aadi's business model. The reimbursement rates and coverage policies significantly influence the sales of FYARRO. For the three months ended September 30, 2024, Aadi incurred distribution fees and rebates that affected their net product sales, highlighting the importance of payer relationships.

Research institutions focusing on oncology

Aadi collaborates with research institutions that specialize in oncology to further investigate the efficacy of FYARRO and potential new indications. These partnerships are crucial for advancing clinical trials and gaining insights into patient outcomes. Aadi has recently paused new patient enrollments in ongoing clinical trials to re-evaluate their research strategy.

Customer Segment	Description	Financial Impact	Market Dynamics
Patients with advanced malignant PEComa	Targeting a small, specialized group of patients with a rare cancer.	Net product sales of $18.7 million (Q3 2024).	Limited market size but high demand for specialized treatment.
Oncologists and cancer treatment centers	Primary healthcare providers administering FYARRO.	Commercial team focused on provider engagement.	Critical for ensuring product availability and treatment access.
Payers and insurance companies	Entities influencing reimbursement rates and coverage policies.	Rebates and distribution fees significantly affect net sales.	Vital for product affordability and market penetration.
Research institutions	Collaborators in clinical trials and research on oncology treatments.	Influences future product development and clinical outcomes.	Essential for gaining insights and expanding treatment indications.

Aadi Bioscience, Inc. (AADI) - Business Model: Cost Structure

High R&D expenses for drug development

Aadi Bioscience incurs significant costs in research and development (R&D) as it focuses on developing its lead product, FYARRO. For the three months ended September 30, 2024, R&D expenses totaled $9.997 million, compared to $11.890 million for the same period in 2023. For the nine months ended September 30, 2024, R&D expenses were $36.683 million, slightly up from $36.161 million in 2023. The decrease in quarterly R&D expenses was primarily attributed to a reduction in personnel and consulting costs, although there was an increase in expenses related to clinical drug product manufacturing.

Period	R&D Expenses (in millions)
Q3 2024	$9.997
Q3 2023	$11.890
YTD Q3 2024	$36.683
YTD Q3 2023	$36.161

Marketing and promotional costs for FYARRO

The marketing and promotional expenses associated with FYARRO have also been substantial. For the three months ended September 30, 2024, selling, general and administrative (SG&A) expenses, which include marketing costs, were $7.186 million, down from $11.221 million in the same period of 2023. For the nine months ended September 30, 2024, SG&A expenses totaled $25.698 million, compared to $34.204 million in 2023. This reduction was primarily due to decreased personnel and marketing expenses following workforce reductions.

Period	SG&A Expenses (in millions)
Q3 2024	$7.186
Q3 2023	$11.221
YTD Q3 2024	$25.698
YTD Q3 2023	$34.204

Manufacturing and compliance costs

Manufacturing costs are integral to Aadi's operations, particularly for FYARRO. The cost of goods sold for the three months ended September 30, 2024, was $0.804 million, compared to $0.697 million in 2023. For the nine months ended September 30, 2024, COGS rose to $2.234 million from $1.882 million in 2023. This increase is attributed to heightened costs related to the sales and preparation of FYARRO.

Period	COGS (in millions)
Q3 2024	$0.804
Q3 2023	$0.697
YTD Q3 2024	$2.234
YTD Q3 2023	$1.882

Administrative and operational expenses

Administrative expenses have been a significant part of Aadi's cost structure. For the three months ended September 30, 2024, total operating expenses amounted to $20.625 million, down from $23.808 million in 2023. The decline is largely due to a reduction in SG&A expenses, which are closely tied to administrative costs. The overall operational strategy has included workforce reductions aimed at lowering costs.

Period	Total Operating Expenses (in millions)
Q3 2024	$20.625
Q3 2023	$23.808
YTD Q3 2024	$67.253
YTD Q3 2023	$72.247

Aadi Bioscience, Inc. (AADI) - Business Model: Revenue Streams

Sales of FYARRO for advanced malignant PEComa

Aadi Bioscience's primary revenue stream is derived from the sales of FYARRO, which was launched on February 22, 2022, for the treatment of patients with advanced malignant perivascular epithelioid cell tumor (PEComa). For the three months ended September 30, 2024, net product sales of FYARRO were $7.2 million, compared to $5.9 million for the same period in 2023. For the nine months ended September 30, 2024, net product sales were $18.7 million, a slight increase from $18.0 million during the same period in 2023.

Period	Net Product Sales (in millions)
Q3 2024	$7.2
Q3 2023	$5.9
9M 2024	$18.7
9M 2023	$18.0

Potential royalties from licensing agreements

Aadi Bioscience has licensing agreements that may generate royalty income. Under the BMS License Agreement, Aadi is entitled to receive royalties on net sales of FYARRO. For the three months ended September 30, 2024, royalties amounted to $0.5 million, compared to $0.4 million for the same period in 2023. For the nine months ended September 30, 2024, royalties were $1.4 million, slightly up from $1.3 million in the same period in 2023.

Period	Royalties (in millions)
Q3 2024	$0.5
Q3 2023	$0.4
9M 2024	$1.4
9M 2023	$1.3

Milestone payments from collaborations

Aadi has been involved in collaborations that include milestone payments. Notably, the company received a $1.0 million milestone payment in December 2021 upon the achievement of FDA approval for FYARRO. There were no milestone payments reported for the three and nine months ended September 30, 2024, reflecting the current status of collaborations.

Future product sales from expanded indications

Looking ahead, Aadi Bioscience plans to explore expanded indications for FYARRO, which may significantly enhance future sales. The company has previously conducted clinical trials for additional indications, although recent strategic decisions have led to a halt in specific trials. The potential for these future product sales remains contingent upon successful regulatory approvals and market acceptance.

Future Product Sales Potential	Details
Expanded Indications	Pending regulatory approvals for additional indications.
Current Clinical Trials	Paused enrollment in EEC and NET trials.

Updated on 16 Nov 2024

Resources:

1. Aadi Bioscience, Inc. (AADI) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Aadi Bioscience, Inc. (AADI)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Aadi Bioscience, Inc. (AADI)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.