ALX Oncology Chief Medical Officer resigns, search for replacement begins

SOUTH SAN FRANCISCO, CA – ALX Oncology Holdings Inc. (NASDAQ:ALXO) announced today the resignation of Chief Medical Officer Sophia Randolph, M.D., Ph.D. Dr. Randolph, who has been a key figure in the company's efforts to develop cancer treatments, will depart on October 11, 2024, to pursue other professional opportunities. Her departure is not due to any disagreements with the company's practices or policies.

The company expressed gratitude for Dr. Randolph's years of dedication and is set to begin the search for a new Chief Medical Officer. In the interim, Dr. Randolph has agreed to a separation package that includes a lump sum payment of $503,880, COBRA coverage for up to 18 months, and full vesting of her stock options and restricted stock units that would vest within 12 months post-separation.

These stock options will be exercisable until July 11, 2026. Moreover, Dr. Randolph is eligible for severance benefits as per her change in control and severance agreement dated July 9, 2020.

To ensure a smooth transition, Dr. Randolph will provide consulting services to ALX Oncology on an hourly basis for up to 18 months following her separation. The specifics of the separation and consulting agreements will be disclosed in future SEC filings.

This announcement includes forward-looking statements, which are subject to risks and uncertainties. The company cautions that these statements are not guarantees of future performance and advises investors to consider the risks detailed in ALX Oncology's SEC filings.

ALX Oncology, based in South San Francisco, specializes in pharmaceutical preparations and is dedicated to advancing treatments for cancer patients. The information regarding Dr. Randolph's resignation and the subsequent arrangements is based on a press release statement.

In other recent news, ALX Oncology Holdings Inc. has announced the promising results from its Phase 2 ASPEN-06 clinical trial. The trial evaluated the efficacy of evorpacept, a therapeutic designed to block the CD47 immune checkpoint pathway, in patients with HER2-positive advanced gastric or gastroesophageal junction (GEJ) cancer. The trial demonstrated an increase in the overall response rate and a longer median duration of response when evorpacept was added to the treatment regimen.

Furthermore, the U.S. Food and Drug Administration has granted Fast Track designation to evorpacept for the treatment of HER2-positive gastric or GEJ carcinoma. ALX Oncology has also announced changes to its board with the appointment of oncology veteran Dr. Alan Sandler and the stepping down of Jaume Pons, Ph.D., and Sophia Randolph, M.D., Ph.D., to focus on their executive roles within the company.

Analyst firms UBS and Piper Sandler have maintained 'Buy' and 'Overweight' ratings respectively, while Stifel has maintained its 'Hold' rating. Lastly, ALX Oncology has appointed Allison Dillon, Ph.D., as its new Chief Business Officer. These are the recent developments in ALX Oncology.

InvestingPro Insights

As ALX Oncology navigates this leadership transition, InvestingPro data provides additional context for investors. The company's market capitalization stands at $90.6 million, reflecting its current valuation in the biotech sector. Despite the recent organizational change, ALX Oncology maintains a strong liquidity position, with InvestingPro Tips highlighting that the company "holds more cash than debt on its balance sheet" and "liquid assets exceed short term obligations."

However, investors should note that ALX Oncology is "quickly burning through cash," which is not uncommon for biotech companies in the development stage. This cash burn rate aligns with the company's significant operating loss of $180.59 million over the last twelve months, as reported by InvestingPro Data.

The stock's recent performance has been challenging, with InvestingPro Tips indicating that it has "taken a big hit over the last week" and is "trading near 52-week low." This market reaction may reflect investor uncertainty following the CMO's resignation and broader concerns about the company's path to profitability.

For a more comprehensive analysis, InvestingPro offers 11 additional tips for ALX Oncology, providing deeper insights into the company's financial health and market position during this transitional period.

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