LTRN: New Programs, Pipeline Progress, Raise, and RADR

By John Vandermosten, CFA



Fourth Quarter and Full Year 2020 Financial and Operational Results

On March 10, 2021, Lantern Pharma, Inc. (NASDAQ:LTRN) announced fourth quarter and full year 2020 financial and operational results, filed its form 10-K with the SEC and hosted a conference call to review the year’s accomplishments. During 2020, Lantern completed its $26.3 million initial public offering, initiated an Antibody Drug Conjugate (ADC) program, identified and validated additional cancer indications for LP-184, made progress with its candidate LP-184 in glioblastoma, prostate and pancreatic cancers and accumulated over 1.2 billion curated datapoints to train its proprietary RADR platform. Following the end of the reporting period, Lantern also successfully executed a $69 million capital raise which is expected to fund the advancement of the pipeline over the next several years.

Lantern did not generate revenues in 2020 and expended $5.9 million in operational expense preparing pipeline candidates for clinical trials and identifying new indications for LP-184.

For the fiscal year ending December 31, 2020 and versus the fiscal year ending December 31, 2019:

➢ Research & development expenses totaled $2.24 million up 135% from $953,000 on an increase in R&D labor, research study expenses and stock option compensation expense;

➢ General & administrative expenses rose 147% to $3.66 million from $1.48 million driven by costs related to becoming a public company including corporate insurance, labor, and stock option compensation expense;

➢ Net loss was ($5.91) million, or ($1.37) per share, compared to ($2.43) million, or ($1.23) per share;

As of December 31, 2020, cash on the balance sheet was $19.2 million, compared to $1.2 million a year before. Following the end of the year, Lantern raised gross proceeds of $69 million in January 2021.

Phase II Clinical Trial For LP-300

Lantern expects to launch a Phase II trial for LP-300 in non-small cell lung cancer (NSCLC) patients that have never smoked in third quarter 2021. The company is interacting with the FDA and other regulatory bodies to refine the design of the trial and is seeking approval from investigators and institutional review boards. While not finalized, Lantern expects to use a combination treatment that includes doublet chemotherapy. The trial is expected to be a two-year, multi-center study enrolling from 40 to 75 patients diagnosed with adenocarcinoma NSCLC with little to no history of smoking and no prior chemotherapy. Beyond assessing the response to treatment in the target population, the trial will also serve to assess the efficacy of LP-300 in combination with chemotherapy on non-smokers, compare efficacy of LP-300 in non-smoking males and non-smoking females, further investigate safety, toxicity and tolerability, and investigate biomarkers. Endpoints are expected to be overall survival, progression-free survival, objective response rate, identification of gene signatures correlated with potential LP-300 efficacy from matched tumor tissue analysis and protection against chemotherapy-induced nephrotoxicity.

New Indications For LP-184 – Atypical Teratoid Rhabdoid Tumors (ATRT)

Atypical teratoid rhabdoid tumors (ATRT) belong to a family of rhabdoid tumors (RT) that can arise in the liver, brain or central nervous system (CNS). 66% of RT arise in the brain and CNS and are known as ATRT. ATRT are a rare and rapidly proliferating cancer (Grade IV) of the brain and spinal cord. ATRT is considered ultra-rare. There are an estimated 58 pediatrics patients diagnosed per year, and an estimated 596 people below the age of majority with the disease in the US (1). Another 10 to 15 cases appear in adults each year. Estimates of the percentage of ATRT originating in the brain vary considerably, with estimates between 15% (2) and 50% (3). The cancer occurs in less than 10% of pediatric brain tumors and is most frequently in children aged 3 and under. Symptoms of ATRT include morning headaches or headaches that are less painful after vomiting, change in activity levels and lethargy, loss of balance or trouble walking, asymmetric eye movements, and increased head size. Treatment is multi-modal including surgery, chemotherapy and radiation. Due to the location in the brain, the tumor is often unresectable. Survival rates are poor which are estimated to be 32.2% at five years (4). Most ATRT are caused by mutations in the SMARCB1 gene. This gene is responsible for tumor growth suppression and when mutated, it is no longer able to suppress tumor formation.

Lantern began its focus on brain and CNS cancers after confirming that its candidate LP-184 readily penetrated the blood-brain barrier. Because LP-184 is able to cross, it can act on cancers in the brain and CNS. Lantern enriched RADR’s dataset with 100 million genomic, transcriptomic and drug sensitivity datapoints specific to brain and CNS cancers leading to the identification of ATRT as a potential target for LP-184. Lantern has been collaborating with researchers from Johns Hopkins for LP-184 in GBM. ATRT is also a research interest for the Johns Hopkins group.

Several other companies have programs that include ATRT. Epizyme (EPZM) has a Phase II trial enrolling multiple rhabdoid tumors. Vyriad (private) has an open label Phase I for brain tumors. Novartis (NVS) has a Phase I in 55 brain tumors. And Cellectar Biosciences (CLRB) has a Phase I open label in malignant brain tumors. Istari Oncology (private) has sponsored a study in recurrent malignant glioma in pediatric populations. Takeda (TAK) and Millennium Pharmaceuticals (private) also are collaborating on a Rhabdoid Tumor trial.

In vitro evaluation has already shown nanomolar potency of LP-184 across multiple ATRT cell lines as measured by IC50, or the concentration required to decrease the intended biochemical function by half.

LP-184 IC50 (nM) vs ATRT Cell Lines (5)

Due to their rarity, pursuit of diseases like ATRT affords special FDA approval pathways including Orphan Drug Designation and access to the Rare Pediatric Disease Priority Review Voucher Program (6). Additionally, the discovery of the relevance of SMARCB1 to LP-184 may hold significance in other, peripheral cancers. In addition to the brain and CNS, ATRT and RT can materialize in the kidney. SMARCB1 mutations may occur in certain types of lung and ovarian cancer as well. Lantern tested various cell types, with varying SMARCB1 expression for sensitivity to LP-184 and found statistical significance between SMARCB1 expression and LP-184 sensitivity. For experimental insights regarding ATRT and biomarkers SMARCB1 and PTGR1, see our previous report here.

Priority Review Vouchers

One of the incentives to develop therapies in rare pediatric conditions is the FDA’s Priority Review Voucher (PRV). Under Section 529 of the Federal Food, Drug and Cosmetic Act, the FDA may award priority review vouchers to sponsors of rare pediatric disease product applications, subject to certain criteria (7). Qualification for a voucher requires approval for a drug or biologic for a rare pediatric disease. The voucher can be redeemed to receive a priority review of a subsequent approval application for a different product. Priority review can reduce the time for review from 10 months to six (8). A fee of $2.1 million is required to redeem the voucher and they do not expire.

Due to the pandemic, the Office of Orphan Products Development (OOPD) has relaxed constraints regarding the applications for rare pediatric disease designation, as well as others including orphan drug and humanitarian use device designations. Applicants are now able to submit via email to the OOPD.

The Rare Pediatric Disease Priority Review Voucher Program (RPDRPVP) was recently extended on December 27, 2020. Under sunset provisions, after September 30, 2024, the FDA may only award vouchers for drugs with rare pediatric disease designation granted before the cutoff date. After September 30, 2026, no vouchers may be awarded unless the program is renewed or extended by Congress.

The FDA issued revised draft guidance on the RPDRPVP on July 29, 2019. Draft guidance, in general, allows the FDA to alert the market of potential changes and gives opportunity to receive feedback from industry participants. The RPDRPVP guidance concerned the definition of rare pediatric disease as updated in the Advancing Hope Act of 2016, and also revised explanation of voucher eligibility requirements. As it stands, a rare pediatric disease is one that is rare (fewer than 200,000 in the US) and that is serious or life-threatening primarily in individuals 18 and younger, and for which there is no reasonable expectation of cost recovery through US sales of the drug.

Because the vouchers are used toward the marketing approval of another (non-rare pediatric disease) drug, PRVs have been bought and sold in the market. PRV sales have ranged between $67.5 million to $350 million (9). Recent transactions include Rhythm Pharmaceuticals’ sale of its PRV for $100 million, announced January 5, 2021.

PRV Sale Price vs Time (10)

RADR: 1.2 Billion Data Points

When Lantern went public with its IPO in 2020, RADR began with a dataset of 275 million datapoints. As publicized on March 10, 2021, RADR now features over 1.2 billion data points and expects to reach over 3 billion data points before year end. Some of the growth in datapoints related to Lantern’s new indication in ATRT, as RADR was enriched with CNS cancer data once it was found that LP-184 could cross the blood-brain barrier.

$69 Million Public Offering

On January 20, 2021, Lantern announced the closing of a public offering that yielded $69 million gross and saw the full exercise of underwriter over-allotment option. The offer sold 4,928,571 shares of common stock at $14.00 per share, which included 642,856 in underwriter purchases. Gross proceeds amounted to $69 million and net proceeds were approximately $64 million. Management has guided toward a cash position of over $80 million by the end of first quarter 2021.

With this successful capital raise, Lantern attracted investment from Black River, Corriente, Empery Asset Management, Altium Capital and 5T Capital among others. The raise is expected to allow completion of trials in brain cancers, more specifically ATRT. The raise is also expected to allow Lantern to launch Phase I trials for its ADC program. The additional cash is sufficient for Lantern to fund operations over the next several years and achieve identified milestones, independent of near-term fluctuations in capital markets.

Lantern Clinical Pipeline

Lantern Pharma Pipeline (11)

Historical and Forward Looking Milestones

➢ First patient dosed with LP-100 – 4Q:18

➢ Announced collaboration with NCI to identify response-predictive gene signatures – October 4Q:19

➢ IPO and initiation of trading on the NASDAQ – June 10, 2020

➢ LP-300 cGMP contract – July 2020

➢ Regulatory interaction for Phase II trial design, LP-300 – 2H:20

➢ Phase II of LP-100 in mCRPC readout – 1H:21

➢ Phase II launch of LP-300 – 3Q:21

➢ Phase I launch of LP-184 – 4Q:21 to 1Q:22

Investment Thesis

➢ Proprietary RADR AI-driven algorithm for detecting genetic/biomarker signatures

➢ Opportunities to salvage failed drugs with clinically validated safety history

➢ Declining returns and smaller end markets can benefit from improved drug development approaches that leverage AI

◦ Build from existing preclinical and clinical work

◦ Pursue orphan indications and personalized medicine

◦ Generate pivotal data with less expensive, targeted trials

◦ Use modeling and complex algorithms to reduce failure risk

➢ Over four years of financial runway


Management anticipates 2021 to be a year of transformational growth and progress offering now seven targets in the pipeline and a large war chest of cash to fund preclinical and clinical work for years to come. In the third quarter of 2021, we anticipate the initiation of the Phase II LP-300 study in non-small cell lung cancer among non-smokers, IND-enabling studies of LP-184 in multiple solid tumors, continued advancement of the ADC program and continued investment in RADR’s growing dataset. Management also expects to disclose additional PTGR1 over-expressing tumors as indications for LP-184.

With the recent $69 million raise, Lantern is now equipped to complete clinical trials in both GBM and ATRT, and Phase I trials in its ADC program. Commencement of Phase I ADC trials are expected as early as 4Q:21. For added detail on Lantern’s proprietary AI development platform, RADR, and for background on indications and Lantern’s clinical candidates, please refer to further discussion in our initiation.

SUBSCRIBE TO ZACKS SMALL CAP RESEARCH to receive our articles and reports emailed directly to you each morning. Please visit our website for additional information on Zacks SCR. 

DISCLOSURE: Zacks SCR has received compensation from the issuer directly, from an investment manager, or from an investor relations consulting firm, engaged by the issuer, for providing research coverage for a period of no less than one year. Research articles, as seen here, are part of the service Zacks provides and Zacks receives quarterly payments totaling a maximum fee of $40,000 annually for these services. Full Disclaimer HERE.


1. Atypical Teratoid Rhabdoid Tumors (ATRT) Diagnosis and Treatment – National Cancer Institute

2. Rhabdoid tumor | Genetic and Rare Diseases Information Center (GARD) – an NCATS Program (

3. Atypical Teratoid Rhabdoid Tumor (ATRT) – St. Jude Children’s Research Hospital

4. Atypical Teratoid Rhabdoid Tumors (ATRT) Diagnosis and Treatment – National Cancer Institute

5. Lantern Pharma Company Overview January 11, 2021

6. Developing Products for Rare Diseases & Conditions | FDA

7. Rare Pediatric Disease (RPD) Designation and Voucher Programs | FDA

8. Home – Priority Review Vouchers (

9. GAO January 2020 FDA’s Priority Review Voucher Programs, Accessed March 11, 2021

10. GAO January 2020 FDA’s Priority Review Voucher Programs, Accessed March 11, 2021

11. Lantern Pharma 2020 Form 10-K