UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934

Date of report: For the month of March 2020

Commission File Number: 001-39084

Innate Pharma S.A.
(Translation of registrant's name into English)

Innate Pharma S.A.
117 Avenue de Luminy—BP 30191
13009 Marseille, France
+ 33 (0) 4 30 30 30  

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F [ X ]      Form 40-F [   ]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):


EXHIBIT INDEX

 

Exhibit   Description
   
99.1 Press Release dated March 10, 2020


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

  Innate Pharma S.A.
    
  
Date: March 10, 2020 By:/s/ Laure-Hélène Mercier    
  Name:     Laure-Hélène Mercier
  Title:Chief Financial Officer
  
EdgarFiling

EXHIBIT 99.1

Innate Pharma Reports Full Year 2019 Financial Results and Business Update

MARSEILLE, France, March 10, 2020 (GLOBE NEWSWIRE) -- Innate Pharma SA (Euronext Paris: IPH – ISIN: FR0010331421; Nasdaq: IPHA) (“Innate” or the “Company”) today reported its consolidated financial results for the year ending December 31, 2019. The consolidated financial statements are attached to this press release.

“2019 was a defining moment for Innate Pharma, as we successfully executed our Nasdaq listing in the US and announced plans to advance the Company’s first molecule into Phase III, monalizumab. In addition, we started building out our commercial infrastructure in the US. Collectively, these achievements marked a significant step in raising the Company’s global profile and executing on our corporate, clinical and commercial strategy,” commented Mondher Mahjoubi, Chief Executive Officer of Innate Pharma. “We thank our employees and all of our external stakeholders who have contributed to Innate’s success. We look forward to another exciting year ahead where we’ll continue to deliver on our broad and balanced portfolio, and work to get innovative medicines to patients as quickly as possible.”

Webcast and conference call will be held today at 2:00pm CET (9:00am EST)
Dial in numbers:
France and International: +33 (0)1 76 70 07 94  US only: + 1 866 966 1396
Conference ID: 3963709#

The presentation and access to the live webcast will be available on Innate Pharma’s website 30 minutes ahead of the conference.

A replay will be available on Innate Pharma’s website after the conference call.

Financial highlights for 2019:

The key elements of Innate’s financial position and financial results as of and for the year ended December 31, 2019 are as follows:

The table below summarizes the IFRS consolidated financial statements as of and for the year ended December 31, 2019, including 2018 comparative information.

In thousands of euros, except for data per share December 31, 2019(1)December 31, 2018
Revenue and other income 85,81493,952
Research and development (78,844)(69,555)
Selling, general and administrative (25,803)(18,142)
Operating expenses (104,647)(87,697)
Net income (loss) from distribution agreements (8,219)(1,109)
Operating income (loss) (27,052)5,146
Net financial income (loss) 6,293(2,427)
Income tax expense -333
Net income (loss) (20,759)3,049
Weighted average number of shares outstanding (in thousands) 66,90858,776
Basic income (loss) per share (0.31)0.05
Diluted income (loss) per share (0.30)0.05
 
  December 31, 2019(1)December 31, 2018
Cash, cash equivalents and financial asset 255,869202,712
Total assets 401,361451,216
Shareholders’ equity 217,416167,240
Total financial debt 18,7234,522

(1) The consolidated financial statements as of and for the year ended December 31, 2019 include impacts of the first-time application of IFRS 16 that became applicable on January 1, 2019. The Company applied the modified retrospective transition method; therefore the comparative consolidated financial information as of and for the year ended December 31, 2018 has not been restated.

Pipeline highlights:

Monalizumab (anti-NKG2A antibody), partnered with AstraZeneca:

Lacutamab (IPH4102, anti-KIR3DL2 antibody):

IPH5401 (anti-C5aR antibody):

Lumoxiti (CD22-directed immunotoxin):

IPH5201 (anti-CD39 antibody), partnered with AstraZeneca:

Preclinical Update:

Corporate Update:

Post period event:

About Innate Pharma:

Innate Pharma S.A. is a commercial stage oncology-focused biotech company dedicated to improving treatment and clinical outcomes for patients through therapeutic antibodies that harness the immune system to fight cancer.

Innate Pharma’s commercial-stage product, Lumoxiti, in-licensed from AstraZeneca in the US, EU and Switzerland, was approved by the FDA in September 2018. Lumoxiti is a first-in class specialty oncology product for hairy cell leukemia. Innate Pharma’s broad pipeline of antibodies includes several potentially first-in-class clinical and preclinical candidates in cancers with high unmet medical need.

Innate has been a pioneer in the understanding of natural killer cell biology and has expanded its expertise in the tumor microenvironment and tumor-antigens, as well as antibody engineering. This innovative approach has resulted in a diversified proprietary portfolio and major alliances with leaders in the biopharmaceutical industry including Bristol-Myers Squibb, Novo Nordisk A/S, Sanofi, and a multi-products collaboration with AstraZeneca.

Based in Marseille, France, Innate Pharma is listed on Euronext Paris and Nasdaq in the US.

Learn more about Innate Pharma at www.innate-pharma.com

Information about Innate Pharma shares:

ISIN code
Ticker code
LEI
FR0010331421
Euronext: IPH Nasdaq: IPHA
9695002Y8420ZB8HJE29

Disclaimer:

This press release contains certain forward-looking statements, including those within the meaning of the Private Securities Litigation Reform Act of 1995.The use of certain words, including “believe,” “potential,” “expect” and “will” and similar expressions, is intended to identify forward-looking statements. Although the company believes its expectations are based on reasonable assumptions, these forward-looking statements are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks and uncertainties include, among other things, the uncertainties inherent in research and development, including related to safety, progression of and results from its ongoing and planned clinical trials and preclinical studies, review and approvals by regulatory authorities of its product candidates, the Company’s commercialization efforts and the Company’s continued ability to raise capital to fund its development. For an additional discussion of risks and uncertainties which could cause the company's actual results, financial condition, performance or achievements to differ from those contained in the forward-looking statements, please refer to the Risk Factors (“Facteurs de Risque") section of the Universal Registration Document filed with the French Financial Markets Authority (“AMF”), which is available on the AMF website http://www.amf-france.org or on Innate Pharma’s website, and public filings and reports filed with the U.S. Securities and Exchange Commission (“SEC”), including the Company’s final prospectus dated October 16, 2019, and subsequent filings and reports filed with the AMF or SEC, or otherwise made public, by the Company.

This press release and the information contained herein do not constitute an offer to sell or a solicitation of an offer to buy or subscribe to shares in Innate Pharma in any country.

For additional information, please contact:

Investors

Innate Pharma 
Danielle Spangler
Tel.: +1 917 608 1134
Danielle.Spangler@innate-pharma.com

Jérôme Marino
Tel.: +33 (0)4 30 30 30 30
investors@innate-pharma.com

Media

Innate Pharma 
Tracy Rossin (Global/US)
Tel.: +1 240 801 0076
Tracy.Rossin@innate-pharma.com

ATCG Press
Marie Puvieux (France)
Tel.: +33 (0)9 81 87 46 72
innate-pharma@atcg-partners.com


Summary of Consolidated Financial Statements and Notes
as of December 31, 2019

Consolidated Statements of Financial Position
(in thousand euros)

 December 31, 2019(1)December 31, 2018
   
Assets  
   
Cash and cash equivalents202,887152,314
Short-term investments15,97815,217
Trade receivables and others - current18,740152,112
Total current assets237,605319,643
   
Intangible assets96,96884,529
Property and equipment11,67210,216
Non-current financial assets37,00535,181
Other non-current assets8986
Deferred tax assets1,2861,561
Trade receivables and others - non-current16,737-
Total non-current assets163,756131,574
   
Total assets401,361 451,216
   
Liabilities  
Trade payables and others49,50491,655
Collaboration liabilities – Current portion21,30420,987
Financial liabilities – Current portion2,1301,347
Deferred revenue – Current portion48,77082,096
Provisions – Current portion114652
Total current liabilities121,822196,737
   
Collaboration liabilities – Non current portion-10,669
Financial liabilities – Non-current portion16,5933,175
Defined benefit obligations3,7603,697
Deferred revenue – Non-current portion40,34268,098
Provisions – Current portion14238
Deferred tax liabilities1,2861,561
Total non-current liabilities62,12387,238
   
Share capital3,9413,197
Share premium369,617299,932
Retained earnings(134,912)(137,840)
Net income (loss)(20,759)3,049
Other reserves(472)(1,099)
Total shareholders’ equity217,416167,240
   
Total liabilities and shareholders’ equity401,361451,216

(1) The consolidated financial statements as of and for the year ended December 31, 2019 include impacts of the first-time application of IFRS 16 that became applicable on January 1, 2019. The Company applied the modified retrospective transition method; therefore the comparative consolidated financial information as of and for the year ended December 31, 2018 has not been restated. The impact of the standard application in Innate’s Consolidated Statement of Financial Position as of December 31, 2019 was an increase in “Property and equipment” of €1.8m and an increase of €2.0m in “Financial liabilities”.    


Consolidated Statements of Income (loss)
(in thousand euros)

 December 31, 2019(1)December 31, 2018
   
   
Revenue from collaboration and licensing agreements68,97479,892
Government financing for research expenditures16,84014,060
   
Revenue and other income85,81493,952
   
Research and development expenses(78,844)(69,555)
Selling, general and administrative expenses(25,803)(18,142)
   
Operating expenses(104,647)(87,697)
   
   
Net income (loss) from distribution agreements(8,219)(1,109)
Operating income (loss)(27,052)5,146
   
Financial income11,2696,002
Financial expenses(4,976)(8,429)
Net financial income (loss)6,293(2,427)
   
Net income (loss) before tax (20,759)2,718
   
   
Income tax expense-333
   
Net income (loss)(20,759)3,049
   
Net income (loss) per share:  
(in € per share)  
- basic income (loss) per share(0.31)0.05
- diluted income (loss) per share(0.30)0.05

(1) The consolidated financial statements as of and for the year ended December 31, 2019 include the impacts of the first application of IFRS 16 standard that became applicable on January 1, 2019. The comparative consolidated financial statements as of and for the year ended December 31 2018 have not been restated.


Consolidated Statements of Cash Flows
(in thousand euros)

 December 31, 2019(1)December 31, 2018
Net income (loss)(20,759)3,049
Depreciation and amortization16,5297,401
Employee benefits costs685477
Provisions for charges(484)(322)
Share-based compensation expense3,8262,707
Change in valuation allowance on financial assets(4,065)3,786
Gains (losses) on financial assets(280)(1,341)
Change in valuation allowance on financial assets(237)152
Gains (losses) on assets and other financial assets(1,290)(1,445)
Interest paid204102
Other profit or loss items with no cash effect550-
Operating cash flow before change in working capital(5,321)14,566
Change in working capital40,245(47,096)
Net cash generated from / (used in) operating activities:34,924(32,529)
Acquisition of intangible assets, net(64,130)(556)
Acquisition of property and equipment, net(1,271)(873)
Disposal of property and equipment-22
Disposal of other assets(10)25
Disposal of current financial instruments-2,704
Disposal of non-current financial instruments2,00021,513
Interest received on financial assets1,2901,445
Net cash generated from / (used in) investing activities:(61,543)24,279
Proceeds from the exercise / subscription of equity instruments44111
Increase in capital, net66,00662,557
Proceeds from borrowings13,900 
Repayment of borrowings(1,982)(1,343)
Net interest paid(204)(102)
Net cash generated from financing activities:77,76561,222
Effect of the exchange rate changes5(26)
Net increase / (decrease) in cash and cash equivalents:50,57252,946
Cash and cash equivalents at the beginning of the year:152,31499,367
Cash and cash equivalents at the end of the six-months period:202,887152,314

(1) The consolidated financial statements as of and for the year ended December 31, 2019 includes impacts of the first-time application of IFRS 16 that became applicable on January 1, 2019. The Company applied the modified retrospective transition method; therefore the comparative consolidated financial information as of and for the year ended December 31, 2018 has not been restated.

Revenue and other income

The following table summarizes operating revenue for the periods under review:

In thousands of euroDecember 31, 2019
December 31, 2018
Revenue from collaboration and licensing agreements68,97479,892
Government financing for research expenditures16,84014,060
Revenue and other income85,81493,952

Revenue from collaboration and licensing agreements

Revenues from collaboration and licensing agreements decreased by €10.9 million, or 13.7%, to €69.0 million for the year ended December 31, 2019, as compared to €79.9 million for the year ended December 31, 2018. Revenue from collaboration and licensing agreements mainly result from the spreading of the upfront and opt-in payments received from AstraZeneca when the April 2015 and October 2018 agreements were signed. This spreading is based on the completion of the work the Company executed in relation to these agreements. The evolution in 2019 is mainly due to:

Government funding for research expenditures

Government funding for research expenditures increased by €2.8 million, or 19.8%, to €16.8 million for the year ended December 31, 2019, as compared to €14.1 million for the year ended December 31, 2018. This change is primarily a result of an increase in the research tax credit of €3.2 million, which is mainly due to an increase in the amortization expense relating to the intangible assets related to the acquired licenses (see R&D expenses).

The research tax credit is calculated as 30% of the amount of research and development expenses, net of grants received, eligible for the research tax credit for the years ended December 31, 2019 and 2018. Following the loss of the SME status under European Union criteria as of December 31, 2019, the CIR for the tax year 2019 will be imputable on the tax expense of the following three tax years, or refunded if necessary at the end of this delay.

Operating expenses

The table below presents our operating expenses for the years ended December 31, 2019 and 2018.

In thousands of eurosDecember 31, 2019December 31, 2018
Research and development expenses(78,844)(69,555)
Selling, general and administrative expenses(25,803)(18,142)
Operating expenses(104,647)(87,697)

Research and development expenses

Research and development (“R&D”) expenses increased by €9.3 million, or 13.4%, to €78.8 million for the year ended December 31, 2019, as compared to €69.6 million for the year ended December 31, 2018. R&D expenses represented a total of 75.3% and 79.4% of the total operating expenses for the years ended December 31, 2019 and 2018, respectively.

They include direct R&D expenses (subcontracting costs and consumables), depreciation and amortization, and personnel expenses. Direct expenses decreased by €2.3 million, or 3.8%, to €44.4 million for the year ended December 31, 2019, as compared to €46.1 million for the year ended December 31, 2018. This evolution resulted from a decrease in chemical, manufacturing and control costs for some of our clinical products, in relation to the phasing of clinical batches production which more than offset the evolution of the other expenses linked to the development and progress of our portfolio. Depreciation and amortization expenses increased by €8.8 million, or 131.2%, to €15.5 million for year ended December 31, 2019, as compared to €6.7 million for the year ended December 31, 2018. This variance results from the increase in amortization expenses relating to monalizumab (as a result of the additional consideration paid to Novo Nordisk A/S and recognized in 2018 following the exercise of its option by AstraZeneca), IPH5201 and Lumoxiti intangible assets (of which the amortization began in October 2018). Personnel expenses including share-based compensation to our employees and consultants allocated to R&D increased by €1.7 million, or 11.7%, to €15.9 million for the year ended December 31, 2019, as compared to €14.2 million for the year ended December 31, 2018. This increase is the cumulative impact of increases in wages and salaries, exceptional bonus in 2019 and increase in share-based payments. As of December 31, 2019 and 2018, we had 162 and 154 employees engaged in R&D activities, respectively.

Selling, general and administrative expenses

Selling, general and administrative (“SG&A”) expenses increased by €7.7 million, or 42.2%, to €25.8 million for the year ended December 31, 2019, as compared to €18.1 million for the year ended December 31, 2018. SG&A expenses represented a total of 24.7% and 20.7% of the total operating expenses for the years ended December 31, 2019 and 2018, respectively. 

Personnel expenses (including share-based compensation) include the compensation paid to our employees and consultants, and increased by €3.0 million, or 39.1%, to €10.6 million for the year ended December 31, 2019, as compared to €7.6 million for the year ended December 31, 2018. This increase mainly results from a rise in wages and salaries, resulting from the increase in staff. As of December 31, 2019, we had 65 employees in selling, general and administrative functions, to be compared to 41 employees as of December 31, 2018 (+59%). This results in part from the development of our commercial activities in the United States, including the recruitment of commercial team, as well as the Company reinforcing its General & Administrative support functions in light of its corporate evolution.

SG&A expenses also include non-scientific advisory and consulting expenses which mostly consist of auditing, accounting, taxation, legal, business and hiring fees. Non-scientific advisory and consulting expenses increased in 2019 as a result of the structuration of the US subsidiary and the commercialization of Lumoxiti. Other expenses are related to intellectual property, maintenance costs for laboratory equipment and our headquarters, depreciation and amortization and other general and administrative expenses.

Net income (loss) from distribution agreements

When product sales are performed by a partner in the context of collaboration or transition agreements, the Company must determine if the partner acts as an agent or a principal. The Company concluded that AstraZeneca acts as a principal in the context of the production and commercialization of Lumoxiti. Consequently, the global inflows and outflows received from or paid to AstraZeneca are presented on a single line in the statement of income of Innate Pharma. This amount does not include the research and development costs which are recognized as R&D operating expenses.

We recognized a net loss of €8.2 million from the Lumoxiti distribution agreement in the year ended December 31, 2019, to be compared to a net loss of €1.1 million for the year ended December 31, 2018, which reflected revenue from sales of Lumoxiti in the period, less administrative and selling expenses associated with the sales revenue allocated to us, in the context of the launch of the drug. As a reminder, Lumoxiti’s commercial launch in the US took place in November 2018 (whereas recognized over 12 months in 2019) and the drug is in the ramp-up phase. In 2019, the Company had a cost sharing mechanism with AstraZeneca that will be reimbursed in 2020. The transition period is expected to end in 2020.

Financial income (loss), net

The net financial result increased by €8.7 million to a €6.3 million gain for the year ended December 31, 2019, as compared to €2.4 million loss for the year ended December 31, 2018. This increase is mainly explained by a €4.1 million gain relating to the change in valuation allowance on financial instruments (2018: €3.8 million loss)

Balance sheet items

Cash, cash equivalents, short-term investments and financial assets (current and non-current) amounted to €255.9 million as of December 31, 2019, as compared to €202.7 million as of December 31, 2018. Net cash as of December 31, 2019 (cash, cash equivalents and current financial assets less current financial liabilities) amounted to €216.7 million (€166.2 million as of December 31, 2018).

The other key balance sheet items as of December 31, 2019 are:

Cash-flow items

The net cash flow generated over the year ended December 31, 2019 amounted to €50.6 million, compared to a net cash flow of €52.9 million for the year ended December 31, 2018.

The net cash flow generated during the period under review mainly results from the following:

Post period events

On November 22, 2019, AstraZeneca submitted to the European Medicines Agency (EMA) the Marketing Authorization Application (MAA) relating to the commercialization of Lumoxiti in Europe. According to the agreement related to Lumoxiti with AstraZeneca, AstraZeneca is entitled to a $15.0 million milestone (€13.4 million), which was paid by the Company in January 2020.

On January 10, 2020, the Company signed an amendment to its lease in order to expand its premises. This amendment also extends the duration of the contractual commitment. The effective date of this addendum is January 15, 2020. Consequently, and following the application of IFRS 16 standard, the impact on the consolidated financial statements are the following: recognition of a right of use (asset) of €1.2 million and a lease liability of €1.1 million.

On March 9, 2020, the first patient in the multicenter, open-label, dose-escalation Phase I trial evaluating IPH5201 as monotherapy or in combination with durvalumab (anti-PD-L1) with or without oleclumab (anti-CD73) in advanced solid tumors was dosed. Upon the first patient dosed in the IPH5201 Phase I clinical trial, AstraZeneca will make a $5 million milestone payment to Innate under the companies’ October 2018 multi-product oncology development collaboration. Innate will make a €2.7 million milestone payment to Orega Biotech SAS pursuant to Innate’s exclusive licensing agreement.

Nota

The consolidated financial statements for the year ended December 31, 2019 have been reviewed by our Statutory Auditors and were approved by the Executive Board of the Company on March 9, 2020. They were reviewed by the Supervisory Board of the Company on March 9, 2020. The statutory auditors’ report is in the process of being issued.

Risk factors

Risk factors identified by the Company are presented in the section 3 of the registration document (“Universal Registration Document”) submitted to the French stock-market regulator, the “Autorité des Marchés Financiers”, on September 20, 2019 as well as in the Risk Factors section of its prospectus filed with the US stock market regulator, the Securities and Exchange Commission, on October 18, 2019.

1 Based on an exchange rate of €1 = $1.1065 on October 16, 2019
2 Including short term investments (€16.0m) and non-current financial instruments (€37.0m)
3 Based on an exchange rate of €1 = $1.1065 on October 16, 2019