On December 18, 2015 Boehringer Ingelheim reported that the latest data from its oncology portfolio will be presented at the ESMO (Free ESMO Whitepaper) Asia 2015 Congress in Singapore, 18-21 December 2015 (Press release, Boehringer Ingelheim, DEC 17, 2015, View Source [SID:1234508601]). New data for BI 1482694* (HM61713**) demonstrate a strong anti-tumour activity (confirmed objective response and disease control rates) with a favourable safety profile in patients with epidermal growth factor receptor (EGFR)-mutated non-small cell lung cancer (NSCLC) whose tumours have acquired the most common mechanism of resistance, the T790M mutation, and have stopped responding to treatment with previous 1st- and/or 2nd-generation EGFR targeted therapies. BI 1482694 is a novel, 3rd-generation, EGFR mutant-specific tyrosine kinase inhibitor (TKI).

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Dr Mehdi Shahidi, Medical Head, Solid Tumour Oncology, Boehringer Ingelheim commented, "We are looking forward to presenting the exciting new data from our oncology portfolio at ESMO (Free ESMO Whitepaper) Asia 2015 Congress. The results of the two head-to-head trials of afatinib versus 1st-generation TKIs, gefitinib and erlotinib, could provide guidance to the practicing oncologist on the choice of TKIs in EGFR-mutated and squamous cell lung cancer, respectively. We are also excited to present the latest results for BI 1482694, Boehringer Ingelheim’s newest compound, as we strive to extend the continuum of treatment with targeted therapies for patients with EGFR-mutated lung cancer and delay the burdensome side effects of chemotherapy for even longer."

On December 17, 2015 Adaptimmune Therapeutics plc (Nasdaq: ADAP), a leader in the use of TCR engineered T-cell therapy to treat cancer, reported that it has initiated a Phase I/II study of its affinity enhanced T-cell therapy targeting the MAGE-A10 cancer antigen in patients with locally advanced or metastatic (Stage IIIb or IV) non-small cell lung cancer (NSCLC), the most prevalent type of lung cancer representing approximately 85 percent of lung cancers (Press release, Adaptimmune, DEC 17, 2015, http://www.adaptimmune.com/company-news/adaptimmune-announces-initiation-of-study-to-evaluate-its-new-affinity-enhanced-t-cell-therapy-targeting-mage-a10-in-patients-with-nsclc-the-most-common-form-of-lung-cancer/ [SID:1234508591]).

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This will be the first study of Adaptimmune’s unpartnered affinity enhanced T-cell therapy targeting MAGE-A10, a highly immunogenic member of the MAGE-A family of cancer testis antigens. MAGE-A10 is expressed in a number of solid tumor cell types, and the immunogenicity of the MAGE-A10 antigen has been robustly established. Cancer testis antigen expression in cancer is often associated with higher grade tumors.

"The initiation of this study is an important step in our goal to identify and develop new T-cell-based immunotherapeutics to combat non-small cell lung cancer and other cancers, and we are excited to initiate clinical development of another of our promising affinity enhanced TCR therapeutic candidates," said Dr. Rafael Amado, Adaptimmune’s Chief Medical Officer. "We have already seen encouraging clinical responses in certain cancers to our lead T-cell therapeutic candidate, which targets the NY-ESO-1
cancer antigen, demonstrating that it is possible to utilize our proprietary affinity enhancement technology to modify TCRs to so that they target cancer cells effectively. It is our hope that we may one day offer patients suffering from non-small cell lung cancer an efficacious and well-tolerated therapeutic option."

This is an open label, 3+3 dose escalation study of autologous T-cells genetically engineered with an affinity optimized MAGE-A10 TCR in HLAA*0201 and HLA-A*0206 positive patients with stage IIIb or stage IV NSCLC expressing the MAGE-A10 antigen. Though the prevalence of HLA sub-types varies from population to population, the most common in the western world is HLA-A2. Among the HLA-A2 variants, the most prevalent are HLA-A*0201 and HLA-A*0206.

The study is intended to enroll up to 32 patients in leading clinical centers located in the United States and Europe and will assess the safety and tolerability of Adaptimmune’s affinity enhanced T-cell therapy targeting MAGE-A10. Secondary objectives will include the assessment of clinical efficacy, measurements of durability of persistence of MAGE-A10 T-cells in the blood, and exploratory tumor biomarker studies and evaluations of the phenotype and functionality of MAGE-A10 T-cells.

For more information on this clinical trial, visit ClinicalTrials.gov at: View Source (Identifier: NCT02592577).

About NSCLC
Lung cancer is the most common cancer worldwide, and is the leading cause of cancer deaths in both men and women in the United States. Each year, more people die of lung cancer than of colon, breast, and prostate cancers combined. Non-small cell lung cancer or NSCLC is the most common type of lung cancer, representing approximately 85 percent of lung cancers. There are 3 main subtypes of NSCLC. Approximately 40 percent of lung cancers are adenocarcinomas, which start in early versions of the cells that would normally secrete substances such as mucus. This type of lung cancer occurs mainly in current or former smokers, but it is also the most common type of lung cancer seen in non-smokers. Approximately 25 to 30 percent of all lung cancers are squamous cell carcinomas, which start in early versions of squamous cells which line the inside of the airways in the lungs and are generally linked to a history of smoking. Large cell (undifferentiated) carcinoma account for 10 to 15 percent of lung cancers and can appear in any part of the lung.

On December 17, 2015 Innate Pharma SA (the "Company" – Euronext Paris: FR0010331421 – IPH) reported the opening of the Phase Ib/II trial of monalizumab (previously IPH2201), a first-in-class NKG2A checkpoint inhibitor, in combination with cetuximab in patients with relapsed or metastatic squamous cell cancer of the head and neck (SCCHN) (Press release, Innate Pharma, DEC 17, 2015, View Source [SID:1234508588]). This multicentric trial, which will include up to 70 patients, will be performed in Europe and the United States. It is the second trial testing monalizumab in head and neck cancer, after the monotherapy neo-adjuvant trial opened in 2014.

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Pierre Dodion, MD, Chief Medical Officer at Innate Pharma, said: "HLA-E is frequently expressed by head and neck cancer cells. Monalizumab is a new checkpoint inhibitor targeting both T and NK cells and preventing their inhibition by HLA-E on tumor cells. Furthermore, monalizumab enhances antibody dependent cellular cytotoxicity (ADCC), one of the mechanisms of action of cetuximab, setting a sound rationale for their combination". He added: "All trials from Innate’s initial clinical development plan are now recruiting patients, involving reference centers. We look forward to continuing on expanding this plan to fully explore the potential of monalizumab".

Dr. Roger Cohen, Associate Director of Clinical Research at the Abramson Cancer Center and Professor of Medicine at the Hospital of the University of Pennsylvania, and lead investigator for the study, said: "Cetuximab is the only targeted therapy approved in recurrent/metastatic head and neck cancer. However, its response rate of about 13% and response duration of less than 6 months leave a significant unmet medical need for this patient population. Immuno-oncology could play a key role in the treatment of head and neck cancer, as demonstrated by a variety of emerging and very promising data. The combination of monalizumab and cetuximab could enhance the efficacy of cetuximab by activating the immune system. This is a very appealing dual mechanism rationale".

This trial is part of a global co-development and commercialization agreement with AstraZeneca for monalizumab. Within this framework, four Phase I/II trials are ongoing: the cetuximab combination trial in SCCHN, two single agent trials respectively in SCCHN and in ovarian cancer*, and a combination trial with ibrutinib in chronic lymphocytic leukemia. The co-development plan also includes a combination clinical trial with monalizumab and durvalumab (MEDI4736), a PD-L1 immune checkpoint inhibitor, in solid tumors, which will be performed by AstraZeneca/MedImmune.

On December 17, 2015 Ligand Pharmaceuticals Incorporated (NASDAQ: LGND) and OMT, Inc. (Open Monoclonal Technology) reported the signing of agreements for Ligand to acquire OMT, Inc., a leader in genetic engineering of animals for the generation of human therapeutic antibodies through its OmniAb platform (Press release, Ligand, DEC 17, 2015, View Source [SID1234526561]).

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OMT has leading antibody drug discovery technology and is believed to be the only company in the world offering three transgenic animal platforms for license. Its license agreements with biotechnology partners will initially add 16 shots on goal to Ligand, as well as future potential licensing deals and additional compounds generated from existing partnerships. OMT has existing licenses with Amgen, Celgene, Genmab, Janssen, Merck KGaA, Pfizer, Seattle Genetics, Five Prime, Symphogen and various other biotechnology and pharmaceutical companies. OMT is privately held and is majority owned by Essex Woodlands.

Under the terms of the transaction, Ligand will pay OMT shareholders approximately $178 million, including $92.6 million in cash and $85.4 million in Ligand common stock. Roland Buelow, Ph.D., founder of OMT and a world-renowned antibody researcher, is expected to join Ligand as Vice President of Antibody Technologies and continue working with Ligand on advancing the OMT business. The transaction is subject to customary closing conditions and is expected to close in January 2016.

"OMT is an ideal strategic fit for Ligand and holds potential to have a profoundly positive impact on our business over the long term," said John Higgins, Chief Executive Officer of Ligand Pharmaceuticals. "OMT brings a robust and important technology for biologic drug discovery that we believe will stand next to Captisol in terms of opportunity for partner events, new licensing transactions and financial contribution. The transaction is expected to be accretive to revenue and adjusted earnings, and if products are approved in the future, the underlying royalties could generate substantial revenues for decades to come. This transaction is a major addition to what Ligand believes is an unprecedented portfolio of more than 140 fully-funded partnered programs."

"OMT has created a highly successful business around the OmniAb antibody technology platform and the business has significant growth potential," said Roland Buelow, Ph.D., Chief Executive Officer of OMT. "We are very impressed with Ligand’s business model, success in deal making and commitment to continue driving the OMT business to even greater success. We believe Ligand’s broad licensing network, business acumen, financial resources and commitment to our technology create an attractive exit for OMT shareholders. I am personally excited to join Ligand as an employee and shareholder, and look forward to helping the talented team continue to expand its business."

OMT OmniAb Antibody Platform

OmniAb refers to three industry-recognized transgenic animal platforms for generation of naturally optimized monospecific, bispecific and polyspecific human therapeutic antibodies.

OmniRat is one of the industry’s first human monoclonal antibody technology based on rats. It has a complete immune system with a diverse antibody repertoire and is genetically engineered to produce antibodies with human idiotypes.

OmniMouse is a transgenic mouse that complements OmniRat and expands epitope coverage and therefore antibody discovery capabilities for partners.

OmniFlic is an engineered rat with a fixed light chain for development of bispecific, fully human antibodies.

All three platforms use patented technology and deliver fully human antibodies with high affinity, specificity, expression, solubility and stability, thereby facilitating more rapid discovery of therapeutic antibodies for partners. OmniAb allows partners to identify high-affinity antibodies in a patented animal system, that therefore have been optimized by in vivo selection pressures, accelerating development times and increasing the prospects of technical success compared with traditional antibody-generation technologies.

Antibodies are a major and growing segment of the pharmaceutical industry. Five of the top 10 selling medicines in 2014 were antibodies. The top 10 selling antibodies in 2014 generated total revenue of $57 billion and the number of antibodies in clinical development has tripled over the past seven years from 150 to 468 currently.

Acquisition Rationale

There are multiple aspects of this transaction that support the strategic rationale to Ligand, including:

1. Financial Contribution – Projected to be accretive to revenues and adjusted earnings with potential for significant financial contribution to Ligand through future royalties.

2. Portfolio Expansion – Major addition of new partners and fully-funded shots on goal. OMT is expected to initially bring to Ligand 16 new shots on goal, and Ligand is projected to have more than 140 fully-funded programs and more than 83 partners after the OMT transaction closes.

3. Technology Diversification – Diversification of Ligand’s technology offering for licensing. OmniAb is a broad and robust technology platform and is a key resource used by biotechnology companies to discover new biologic drugs. The OMT technology is expected to be a new pillar of Ligand’s business, standing alongside the Captisol drug-formulation technology. OmniAb will create a strong platform for Ligand to seek new licenses and partnerships.

4. Royalty Extension – Significant extension of potential patent protection period and royalty terms for Ligand-partnered programs. Patents for OMT technology run through 2033, but each newly discovered antibody may be the basis for its own novel intellectual property, resulting in patents for each antibody on a drug-by-drug basis that could extend past 2040.

Acquisition and OMT Business Highlights

Following are some of the highlights of the OMT business and their expected impact on Ligand:

OMT diversifies Ligand’s business by adding a proprietary antibody-generating platform, giving Ligand further exposure to an important segment of the pharmaceutical industry. OMT has three distinct transgenic rodent systems for generating antibodies: OmniRat, OmniMouse and OmniFlic.
Ligand projects up to three antibodies from the OMT platform will be in human Phase 1 trials by the end of 2017 and as many as 15 antibodies could be in Phase 1 or more advanced trials by 2020.
OMT OmniAb licenses have generally been structured with a combination of license fees, annual technology access fees, milestone payments and royalties. Royalties are generally in the low- to mid-single digits. The existing OMT portfolio is comprised of platform licenses with high-quality companies.
With the acquisition, Ligand is acquiring 16 platform partnerships and antibody-specific licenses. Following the transaction, Ligand will have partnerships with 83 different companies and over 140 fully funded programs with each OMT platform deal currently counting as one shot on goal.
The OMT business is projected to add $6 million and $12 million of revenues to Ligand in 2016 and 2017, respectively. This revenue is based on existing licensing contracts and potential payments, and does not include revenue from potential new partnerships and programs. Annual expenses to operate the OMT business are projected to be between $3 million and $5 million.
The acquisition of the existing OMT business and licenses will accelerate Ligand’s projected financial growth. The transaction is projected to add 5% to 2016 revenue and 7% to 10% to annual revenue over the next decade, after which time initial royalty-bearing products could be approved with contribution to revenue growth being potentially much greater thereafter. The transaction is projected to be slightly accretive to adjusted EPS in 2016 and accretive to adjusted EPS by approximately 4% to 8% per year over the next several years.
Ligand Pro Forma 2016 and 2017 Financial Outlook

Including this acquisition, Ligand expects 2016 total revenues to be between $113 million and $117 million. This guidance assumes approximately $6 million of revenue from the OMT business in 2016, and approximately $107 million to $111 million of revenue from the original Ligand business. Ligand’s pro forma 2016 cash operating expenses are expected to be between $26 million and $28 million. In 2016, adjusted EPS is projected to be unchanged and in the range of $3.33 to $3.38.

For 2017, Ligand expects total revenues to exceed $158 million with adjusted EPS of more than $4.95. This guidance assumes approximately $12 million of revenue from the OMT business in 2017, and approximately $0.20 of incremental EPS contribution from the acquisition.

OMT non-cash amortization expense estimates are expected to be determined in the near term. Amortization charges will be recognized in GAAP EPS and the non-cash charge will be excluded from adjusted EPS.

Adjusted Financial Measures

The adjusted financial measures discussed above exclude changes in contingent liabilities, mark-to-market adjustment for amounts owed to licensors, non-cash stock-based compensation expense, non-cash debt-related costs, pro-rata non-cash net losses of Viking Therapeutics, non-cash OMT purchase price amortization and non-cash tax expense.

Ligand believes that the presentation of adjusted financial measures provides useful supplementary information to investors and reflects amounts that are more closely aligned with the cash profits for the period as the items that are excluded from adjusted net income are all non-cash items. Ligand uses these adjusted financial measures in connection with its own budgeting and financial planning. These adjusted financial measures are in addition to, and not a substitute for, or superior to, measures of financial performance prepared in conformity with GAAP.