On February 25, 2016 RedHill Biopharma Ltd. (NASDAQ:RDHL) (TASE:RDHL) ("RedHill" or the "Company"), a biopharmaceutical company primarily focused on the development and commercialization of late clinical-stage, proprietary, orally-administered, small molecule drugs for inflammatory and gastrointestinal diseases, including cancer, reported its financial results for the year ended December 31, 2015 (Press release, RedHill Biopharma, FEB 25, 2016, View Source [SID:1234509209]).

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Financial highlights for the year ended December 31, 2015 and for the fourth quarter of 2015

Revenues for the fourth quarter and for the year ended December 31, 2015 were immaterial, compared to $7 million for the year ended December 31, 2014. The revenues in 2014 were mainly generated from an upfront payment of $7 million received from Salix Pharmaceuticals, Inc. ("Salix") for the out-licensing of RedHill’s RHB-106 encapsulated bowel preparation and related rights.

Cost of Revenues for the fourth quarter and for the year ended December 31, 2015 were immaterial compared to $1 million in Cost of Revenues for the year ended December 31, 2014. The Cost of Revenues for the year ended December 31, 2014 resulted primarily from a payment made to Giaconda Limited under a 2010 Asset Purchase Agreement, triggered by the payment received from Salix as part of the out-licensing transaction described above.

Research and Development Expenses for the quarter ended December 31, 2015 were approximately $5 million, an increase of approximately 35% compared to $3.7 million in the comparable quarter of 2014. Research and Development Expenses for the year ended December 31, 2015 were approximately $17.8 million, an increase of approximately 40%, compared to $12.7 million for the year ended December 31, 2014. The increase in both periods resulted primarily from clinical trial costs of approximately $13.6 million, related mainly to the ongoing Phase III clinical studies with RHB-104 (Crohn’s disease) and BEKINDA (gastroenteritis).

General and Administrative Expenses for the quarter ended December 31, 2015 were approximately $1.7 million compared to $1.1 million in the comparable quarter of 2014. The increase was mainly due to an increase in professional services due to one-time business development expenses. General and Administrative Expenses for the year ended December 31, 2015 were approximately $4.1 million compared to $4 million for the year ended December 31, 2014.

Operating Loss for the quarter ended December 31, 2015 was $6.8 million, compared to $4.8 million in the comparable quarter of 2014. The increase was mainly due to an increase in Research and Development Expenses and in General and Administrative Expenses. Operating Loss for the year ended December 31, 2015 was approximately $22 million compared to $10.6 million for the year ended December 31, 2014. The increase was mainly due to an increase in Research and Development Expenses during 2015 and to revenues from the Salix licensing transaction in 2014.

Financial Income, net for the quarter ended December 31, 2015 was $0.2 million, compared to $0.5 million in Financial Expenses, net in the comparable quarter of 2014. The difference was mainly due to a change in the fair value of derivative financial instruments. Financial Income, net for the year ended December 31, 2015 were approximately $0.9 million, compared to Financial Expenses, net of approximately $0.1 million for the year ended December 31, 2014. The Financial Income, net in 2015 mainly derived from a fair value gain on derivative financial instruments while the Financial Expenses, net in 2014 were mainly derived from changes in exchange rates.

Net Cash Used in Operating Activities for the quarter ended December 31, 2015 was $6 million, compared to $5.9 million in the comparable quarter of 2014. Net Cash Used in Operating Activities for the year ended December 31, 2015 was approximately $17.8 million, an increase of $5.6 million, or approximately 46%, compared to $12.2 million for the year ended December 31, 2014. The increase resulted from an increase in operating loss, an increase in advanced payments to suppliers and a decrease in accounts payable, both mainly related to research and development activities.

Net Cash Used in Investment Activities for the quarter ended December 31, 2015 was $20.1 million, compared to $0.1 million in the comparable quarter of 2014. The increase was mainly due to investment in bank deposits. Net Cash Used in Investment Activities for the year ended December 31, 2015 was approximately $21.2 million, compared to $17.9 million for the year ended December 31, 2014. The increase was mainly due to investment in bank deposits, in addition to a payment with respect to the YELIVA licensing agreement.

Cash Provided by Financing Activities for the quarter ended December 31, 2015 and the comparable quarter of 2014 were immaterial. Cash Provided by Financing Activities for the year ended December 31, 2015 was approximately $54.8 million, compared to $24.4 million for the year ended December 31, 2014. The increase resulted primarily from the two public offerings in February and July 2015 in the U.S. for a total net amount of $54.7 million.

Cash Balance[1] as of December 31, 2015 was approximately $58.4 million, an increase of $35.5 million, compared to $22.9 million as of December 31, 2014 and a decrease of $5.8 million, compared to $64.2 million as of September 30, 2015.

Ori Shilo, Deputy CEO, Finance and Operations said: "We are very pleased with our financial and operational results for 2015 and are excited for the many potential milestones in 2016. RedHill maintains a strong cash position of approximately $58 million at the end of 2015. Our current cash position allows us to continue to diligently execute our development plans, including interim analysis in the ongoing Phase III study with RHB-104 for Crohn’s disease, initiation of the confirmatory Phase III study with RHB-105 for H. pylori infection, top-line results from the ongoing Phase III study with BEKINDA for gastroenteritis and interim top-line results from the Phase IIa proof-of-concept study with RHB-104 for relapsing-remitting multiple sclerosis, expected in the coming weeks. We believe that RedHill is well-positioned to execute its strategic plans, including the establishment of commercial operations activity in the U.S., and continue to achieve major milestones in 2016."

Conference Call and Webcast Information:

The Company will host a conference call on Thursday, February 25, 2016, at 9:00 am EST to review the financial results and business highlights.

To participate in the conference call, please dial the following numbers five to ten minutes prior to the start of the call: United States: +1-646-254-3388; international: +1-877-280-2342; and Israel: +972-3-763-0146. The access code for the call is 9515243.

The conference call will be broadcasted simultaneously and available for replay on the Company’s website, View Source, for 30 days. Please access the Company’s website at least 15 minutes ahead of the conference to register, download, and install any necessary audio software.

Selected operational highlights for the year ended December 31, 2015:

RHB-105 – H. pylori bacterial infection (Phase III)

In June 2015, the Company received positive top-line results from its first Phase III study with RHB-105 for the treatment of Helicobacter pylori (H. pylori) bacterial infection (the ERADICATE Hp study). The study demonstrated 89.4% efficacy in eradicating H. pylori infection with RHB-105 and successfully met its primary endpoint of superiority over historical standard-of-care (SoC) efficacy levels of 70%, with high statistical significance (p < 0.001). No serious adverse events related to the therapeutic candidate were noted in the study. The Company announced additional supportive data from the study in September 2015. Results from the subsequent open-label treatment of patients in the placebo arm with SoC therapy for persistent H. pylori infection demonstrated a 63% eradication rate with SoC. These results further support the potential superior efficacy of RHB-105 over SoC and validate the use of the historical SoC efficacy threshold of 70% implemented in the Phase III study as the control for the study’s primary endpoint.

RedHill also announced in April 2015 that the United States Patent and Trademark Office (USPTO) had issued a Notice of Allowance for a new U.S. patent covering the RHB-105 formulation, which is expected to be valid until at least 2034.

A meeting with the U.S. Food and Drug Administration (FDA) is scheduled in early April 2016 to discuss the planned confirmatory Phase III study with RHB-105 for the treatment of H. pylori infection.

RHB-104 – Crohn’s disease (Phase III) and multiple sclerosis (Phase IIa)

The MAP US first Phase III study with RHB-104 for Crohn’s disease is currently ongoing in the U.S. and additional countries, with interim analysis of the study expected in the second half of 2016, after half of the 270 patients expected to be enrolled in the study will have completed 26 weeks of treatment.

RedHill further announced, in June 2015, that the UK Medicines and Healthcare Products Regulatory Agency (MHRA) had accepted RedHill’s Clinical Trial Application (CTA) to initiate a second Phase III study with RHB-104 for Crohn’s disease (the MAP EU study). The MAP EU study is planned to commence in a select number of European countries, and, once initiated, will run in parallel with the currently ongoing MAP US first Phase III study.

In February 2016 the Company announced that it had received a Notice of Allowance from the USPTO for a fifth U.S. patent covering RHB-104. Two additional notices of allowance for patents covering RHB-104 were announced in July 2015. All three patents are expected to be valid through 2029.

In November 2015 the Company announced that it had completed the last dosing and scheduled follow-up patient visit ahead of interim top-line interim analysis in the Phase IIa proof-of-concept clinical study evaluating RHB-104 in patients treated for relapsing-remitting multiple sclerosis (RRMS). The open label Phase IIa study (the CEASE-MS study) was designed to assess the efficacy and safety of RHB-104 as an add-on therapy to interferon beta-1a. Top-line interim results are expected in the coming weeks.

In January 2015, the Company announced that it had concluded, together with Quest Diagnostics (Q Squared Solutions LLC), a pre-submission meeting with the FDA regarding the development path of a commercial companion diagnostic test for the detection of Mycobacterium avium subspecies paratuberculosis (MAP) in Crohn’s disease patients. RedHill and Quest Diagnostics (Q Squared Solutions LLC) continue to make progress with the development of the companion diagnostic MAP test.

BEKINDA (RHB-102) – Acute gastroenteritis and gastritis (Phase III); diarrhea-predominant irritable bowel syndrome (IBS-D) (Phase II); oncology support (PK program)

In October 2015, the Company announced that, following a meeting with the FDA regarding the development path for BEKINDA 24 mg, the Company believes that, subject to achieving highly significant positive results, the expanded Phase III study for gastroenteritis and gastritis may be sufficient as a single study to support the filing of a marketing application for BEKINDA 24 mg for this indication in both the U.S. and Europe. Top-line results from the Phase III study are expected in the second half of 2016.

In February 2016, the Company announced the successful completion of a first-in-man pharmacokinetic (PK) study with BEKINDA 12 mg formulation, intended to be administered in the planned Phase II study for the treatment of diarrhea-predominant irritable bowel syndrome (IBS-D). RedHill submitted to the FDA the Investigational New Drug (IND) protocol for the Phase II clinical study with BEKINDA 12 mg for IBS-D, planned to be initiated in the coming weeks, subject to final preparations. The randomized, double-blind, 2-arm parallel group Phase II clinical study is designed to evaluate the safety and efficacy of BEKINDA 12 mg in patients suffering from IBS-D. The study will be conducted in up to 12 clinical sites in the U.S. and is expected to enroll 120 patients.

Following a meeting with the FDA, the Company also announced, in October 2015, that additional clinical data is required to support a U.S. New Drug Application (NDA) with BEKINDA for oncology support indications under the 505(b)(2) regulatory path. Further development for oncology support indications will be decided as data from the ongoing and planned efficacy studies of BEKINDA for gastroenteritis and IBS-D becomes available, as well as additional regulatory feedback from European authorities.

YELIVA (ABC294640) – Multiple oncology, inflammatory and gastrointestinal indications (Phase I/II)

In March 2015, the Company and Apogee Biotechnology Corporation ("Apogee"), a privately-held biotech company located in Hummelstown, Pennsylvania, U.S., entered into an exclusive worldwide license agreement under which RedHill acquired the rights to the Phase II therapeutic candidate YELIVA (ABC294640) and additional intellectual property rights. YELIVA is a proprietary, first-in-class, orally-administered sphingosine kinase-2 (SK2) inhibitor, with anti-inflammatory and anti-cancer activities, targeting multiple oncology and inflammatory-GI diseases. Under the terms of the agreement, RedHill acquired the exclusive worldwide development and commercialization rights to YELIVA and additional intellectual property for all indications.

In June 2015 the Company announced the initiation of a Phase I/II clinical study in the U.S. to evaluate YELIVA in patients with refractory/relapsed diffuse large B-cell lymphoma (DLBCL). The study is funded primarily by a grant awarded by the National Cancer Institute (NCI) STTR program awarded to Apogee.

A Phase I/II study with YELIVA for the treatment of refractory or relapsed multiple myeloma is planned to be initiated during the second quarter of 2016. The study will be conducted at Duke University Medical Center. The study is supported by a $2 million grant from the NCI Small Business Innovation Research Program (SBIR) awarded to Apogee in conjunction with Duke University, with additional support from RedHill.

A third Phase II study is planned to evaluate YELIVA as a radioprotectant to prevent mucositis in cancer patients undergoing therapeutic radiotherapy.

In October 2015 the Company announced positive top-line results from the Phase I study with YELIVA in patients with advanced solid cancers. The study successfully met its primary and secondary endpoints, providing key information about the drug’s safety, toxicities, pharmacokinetics (PK) and pharmacodynamics (PD), supporting the ongoing and planned Phase II studies with YELIVA.

RP101 – pancreatic and other gastrointestinal cancers

In July 2015 the Company elected to extend its August 2014 exclusive option agreement with RESprotect GmbH for the acquisition of the Phase II-stage oncology drug candidate, RP101. In February 2016 the Company announced that it had entered into a research collaboration with Fraunhofer Institute for Cell Therapy and Immunology (IZI), for the evaluation of RP101. As part of the collaboration, Fraunhofer IZI is conducting real-time monitoring of tumor engraftment, tumoricidal efficacy and response to treatment with RP101 in combination with SoC chemotherapies. Results from the studies are expected during the first half of 2016. The preclinical program is intended to support the existing Phase I and Phase II clinical data for RP101 and to assess the drug’s clinical development path.

RIZAPORT (RHB-103) – Acute migraines

In November 2015, the Company, together with IntelGenx Corp. ("IntelGenx"), announced that the Federal Institute for Drugs and Medical Devices of Germany (BfArM) granted marketing authorization of RIZAPORT (RHB-103) 5 mg and 10 mg, an oral thin film formulation of rizatriptan benzoate for the treatment of acute migraines. The national approval of RIZAPORT in Germany was granted under the European Decentralized Procedure (DCP), in which Germany served as the Reference Member State. This authorization is the first national marketing approval of RIZAPORT. In February 2016 the United States Patent and Trademark Office (USPTO) issued a Notice of Allowance for a new patent covering RIZAPORT, which is expected, once granted, to be valid until 2034. RedHill and IntelGenx continue to work together to secure commercialization partners for RIZAPORT to obtain national phase approvals in other European DCP territories as well as FDA marketing approval in the U.S.

Financial Highlights

In July 2015, the Company closed an underwritten public offering for a total of 2,739,143 American Depository Shares ("ADSs"), each representing 10 of its ordinary shares, at an offering price of $16.25 per ADS. Gross proceeds from the public offering were approximately $44.5 million, before underwriting discounts and commissions and other offering expenses. Investors in the offering included Broadfin Capital LLC, Visium Asset Management, Special Situations Funds, funds managed by Sabby Management LLC, Longwood Capital Partners LLC, Menora Mivtachim and others. Nomura and Roth Capital Partners acted as joint book-running managers. MLV & Co. and H.C. Wainwright & Co. acted as co-managers for the offering.

On February 13, 2015, the Company closed an underwritten public offering for a total of 1,150,000 ADSs at an offering price of $12.50 per ADS. Gross proceeds from the public offering were approximately $14.4 million, before underwriting discounts and commissions and other offering expenses. Investors in the offering included Broadfin Capital LLC, OrbiMed, Sabby Capital, LLC, Rosalind Advisors, Inc. and others. Wells Fargo Securities acted as lead book-running manager and Roth Capital Partners acted as joint book-running manager. MLV & Co acted as co-manager of the offering.

On February 25, 2016 Radius Health, Inc. ("Radius" or the "Company") (Nasdaq:RDUS), a science-driven biopharmaceutical company that is committed to developing innovative therapeutics in the areas of osteoporosis, oncology and endocrine diseases, reported its financial results for the fourth quarter and full year ended December 31, 2015, and provided recent corporate highlights (Press release, Radius, FEB 25, 2016, View Source [SID:1234509208]). As of December 31, 2015, Radius had $473.3 million in cash, cash equivalents and marketable securities.

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"Radius continues to make significant progress in advancing its pipeline, including the submission of our MAA in Europe for our investigational drug abaloparatide-SC for the treatment of women with postmenopausal osteoporosis who are at risk for a fracture, which is under regulatory review. We are on track to submit an NDA in the U.S. at the end of the first quarter of 2016," said Robert Ward, President and Chief Executive Officer of Radius. "We are continuing our productive partnering discussions and anticipate entering into an abaloparatide collaboration prior to a potential first commercial launch. We have continued to make progress across the portfolio with the abaloparatide transdermal patch program and RAD1901 trials in breast cancer and vasomotor symptoms."

Pipeline Updates

Abaloparatide-SC

In November 2015, Radius submitted a marketing authorization application ("MAA") to the European Medicines Agency ("EMA"), which subsequently was validated and is currently undergoing regulatory review. Radius plans to submit a new drug application ("NDA") in the United States at the end of the first quarter of 2016. Subject to regulatory review and a favorable regulatory outcome, Radius anticipates the first commercial sales of abaloparatide-SC will take place in 2016.

Abaloparatide-TD

Radius also is developing abaloparatide-transdermal, which it refers to as abaloparatide-TD, based on 3M’s patented Microstructured Transdermal System technology for potential use as a short wear-time transdermal patch. During 2014, Radius reported progress towards the development of an optimized transdermal patch that may be capable of demonstrating comparability to abaloparatide-SC. In preliminary, nonhuman primate pharmacokinetic studies, Radius achieved a desirable pharmacokinetic profile, with comparable AUC, Cmax, Tmax and T1/2 relative to abaloparatide-SC. Radius believes that these results support continued clinical development of abaloparatide-TD toward future global regulatory submissions as a potential post-approval line extension of the investigational drug abaloparatide-SC. Radius commenced a human replicative clinical evaluation of the optimized abaloparatide-TD patch in December 2015 with the goal of achieving comparability to abaloparatide-SC.

RAD1901

Radius continues to enroll and dose patients in the United States in its Phase 1 multicenter, open-label, two-part, dose-escalation study of RAD1901 in postmenopausal women with advanced estrogen receptor positive and HER2-negative breast cancer. The study is designed to determine the recommended dose for a Phase 2 clinical trial and includes a preliminary evaluation of the potential anti-tumor effect of RAD1901. In December 2015, Radius reported on the progress of this study at the San Antonio Breast Cancer Symposium in San Antonio, TX. In addition, in December 2015, Radius commenced a Phase 1 FES-PET study in patients with metastatic breast cancer in the European Union, which includes the use of FES-PET imaging to assess estrogen receptor occupancy in tumor lesions following RAD1901 treatment.

In January 2016, Radius entered into a worldwide clinical collaboration with Novartis Pharmaceuticals to evaluate the safety and efficacy of combining RAD1901 with Novartis’ investigational agent LEE011 (ribociclib), a cyclin-dependent kinase 4/6 inhibitor, and BYL719 (alpelisib), an investigational phosphoinositide 3-kinase inhibitor.

RAD1901 also is being evaluated at low doses as an estrogen receptor ligand for the potential relief of the frequency and severity of moderate to severe hot flashes in postmenopausal women with vasomotor symptoms. Radius commenced a Phase 2b clinical study of RAD1901 for the potential treatment of postmenopausal vasomotor symptoms in December 2015.

Radius Expects the Following Upcoming Milestones

Abaloparatide-SC
Submit an NDA in the United States for abaloparatide-SC at the end of the first quarter of 2016.
Receive opinion from the Committee for Medicinal Products for Human Use regarding the EMA’s review of the abaloparatide-SC MAA.
Enter into a collaboration for the potential commercialization of abaloparatide-SC prior to a commercial launch.
Abaloparatide-TD
Complete the clinical evaluation of the optimized abaloparatide-TD patch during 2016.
RAD1901
Complete the dose-escalation study for RAD1901 in metastatic breast cancer patients by the middle of 2016.
Initiate the expansion cohorts in breast cancer during 2016.
Radius Expects To Make Presentations at the Following Upcoming Conferences

Abstract Presentations at the Endocrine Society Annual Meeting, April 1-4, 2016, in Boston, MA. The titles of the presentations are as follows:
"Abaloparatide Significantly Reduces Vertebral and Non-vertebral Fractures and Increases BMD Regardless of Baseline Risk"

"RAD1901 a Novel Estrogen Receptor Ligand with a Unique Pharmacologic Profile for Potential Use in the Treatment of Postmenopausal Vasomotor Symptoms"

Abstract Presentations at the World Congress of Osteoporosis, Osteoarthritis and Musculoskeletal Diseases, April 14-17, 2016, in Spain. The titles of the presentations are as follows:
"Effects of Abaloparatide on Vertebral, Non-vertebral, Major Osteoporotic and Clinical Fracture Incidence in Postmenopausal Women with Osteoporosis: Results of the Phase 3 Active Trial"

"Eighteen Months of Treatment with Abaloparatide Followed by Six Months of Treatment with Alendronate in Postmenopausal Women with Osteoporosis- Results of the ACTIVExtend Trial"

"Effect of Investigational Treatment Abaloparatide for Prevention of Major Osteoporotic Fracture or any Fracture is Not Altered by Baseline Fracture Probability"

Abstract presentation at the American Association of Cancer Research Annual Meeting 2016, April 16-20, 2016, in New Orleans, LA.
"RAD1901, an orally available SERD, as an effective combination partner in ER+ breast cancer"

IMPAKT 2016 Conference, May 12-14, 2016, in Brussels, Belgium.
"RAD1901, a novel oral, selective estrogen receptor degrader (SERD), for the treatment of advanced estrogen receptor (ER)+ breast cancer (BC)"

Cowen and Company 36th Annual Healthcare Conference, March 7-9, 2016, in Boston, MA.
Deutsche Bank 41st Annual Healthcare Conference, May 4-5, 2016, in Boston, MA.
Bank of America Merrill Lynch 2016 Healthcare Conference, May 10-12, 2016, in Las Vegas, NV.
Recent Corporate Highlight

On December 7, 2015, Radius announced the appointment of Jean-Pierre (JP) Garnier to its Board of Directors, and as Chair of the Compensation Committee. Mr. Garnier is currently Chairman of the Board of Actelion Ltd., and was previously Chief Executive Officer of GlaxoSmithKline plc.
Fourth Quarter 2015 Financial Results

For the three months ended December 31, 2015, Radius reported a net loss of $33.2 million, or $0.77 per share, as compared to a net loss of $18.0 million, or $0.55 per share for the three months ended December 31, 2014. The increase in net loss for the three months ended December 31, 2015 as compared to the three months ended December 31, 2014 was primarily due to an increase in research and development and general and administrative expenses, partially offset by a decrease in interest expense.

Research and development expenses for the three months ended December 31, 2015 were $22.2 million, compared to $11.6 million for the same period in 2014. The increase for the 2015 period as compared to the 2014 period was primarily attributable to an increase in contract service costs associated with the development of RAD1901, consulting costs incurred to support Radius’ MAA and planned NDA submissions for abaloparatide-SC and an increase in compensation expense, including an increase of $0.6 million of non-cash stock-based compensation expense, due to an increase in research and development headcount from December 31, 2014 to December 31, 2015.

General and administrative expenses for the three months ended December 31, 2015 were $11.6 million, compared to $5.6 million for the same period in 2014. The increase for the 2015 period as compared to the 2014 period was primarily attributable to an increase in legal fees and professional support costs, including the costs associated with growing Radius’ headcount and preparing for the potential commercialization of abaloparatide-SC.

There was no interest expense for the three months ended December 31, 2015, compared to $0.8 million for the same period in 2014. The decrease was a result of the prepayment of all amounts owed under Radius’ loan and security agreement on August 4, 2015.

Full Year 2015 Financial Results

For the twelve months ended December 31, 2015, Radius reported a net loss of $101.5 million, or $2.56 per share, as compared to a net loss of $62.5 million, or $4.04 per share, for the twelve months ended December 31, 2014. The increase in net loss for 2015 was primarily due to an increase in research and development expenses, general and administrative expenses, and loss on retirement of note payable.

Research and development expenses for the twelve months ended December 31, 2015 were $68.3 million, compared to $45.7 million for 2014. The increase for 2015 was primarily attributable to an increase in compensation expense, including an increase of $5.9 million of non-cash stock-based compensation expense, due to an increase in research and development headcount from December 31, 2014 to December 31, 2015, an increase in consulting costs incurred to support Radius’ MAA and planned NDA submissions for abaloparatide-SC and an increase in contract service costs associated with the development of RAD1901. These increases were partially offset by a decrease in the costs associated with the abaloparatide-SC Phase 3 ACTIVE and ACTIVExtend clinical trials.

General and administrative expenses for the twelve months ended December 31, 2015 were $30.8 million, compared to $13.7 million for 2014. The increase for 2015 as compared to 2014 was primarily attributable to an increase in legal fees and professional support costs, including the costs associated with growing Radius’ headcount and preparing for the potential commercialization of abaloparatide-SC, subject to favorable regulatory review. This increase also was driven by an increase in compensation expense, including an increase of $1.8 million of non-cash stock-based compensation expense, due to an increase in general and administrative headcount from December 31, 2014 to December 31, 2015.

For the twelve months ended December 31, 2015, loss on retirement of note payable was $1.6 million, compared to $0.2 million for 2014. The loss on retirement of note payable for 2015 was a result of the prepayment of all amounts owed under Radius’ loan and security agreement on August 4, 2015.

As of December 31, 2015, Radius had $473.3 million in cash, cash equivalents and marketable securities. Based upon Radius’ cash, cash equivalents and marketable securities balance, it believes that, prior to the consideration of revenue from the potential future sales, subject to favorable regulatory review, of any of its investigational products, it has sufficient capital to fund its development plans, U.S. commercial scale-up and other operational activities into 2018.

On February 25, 2016 Ionis Pharmaceuticals, Inc. (Nasdaq: IONS) reported it ended the year in a strong financial position, significantly outperforming its guidance for both pro forma net operating loss (NOL) and cash (Press release, Ionis Pharmaceuticals, FEB 25, 2016, View Source;p=RssLanding&cat=news&id=2143280 [SID:1234509206]).

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"We have a pipeline of drugs with the potential to change the lives of patients with many different diseases. In 2015, we completed target enrollment in three Phase 3 studies for our three most advanced drugs in development; nusinersen, IONIS-TTRRx and volanesorsen, bringing these important new medicines one step closer to potentially reaching the market. These drugs are being developed for six different patient populations. We believe the robust development plan for each of these three drugs supports their significant commercial potential. We and our partners are well along in preparing for regulatory filings and for commercialization of nusinersen and IONIS-TTRRx. Our wholly owned subsidiary, Akcea Therapeutics, has begun the key steps necessary to launch volanesorsen. Paula Soteropoulos and her team, working with experts in the field, have begun to implement a multi-step program to increase diagnosis and referral of patients with FCS to lipid-focused physicians. In addition, they are assembling the commercial infrastructure that will support the global launch of volanesorsen," said B. Lynne Parshall, chief operating officer of Ionis Pharmaceuticals.

"The majority of our drugs in Phase 3 and Phase 2 clinical development and our growing number of earlier stage programs provided us with numerous opportunities to highlight the breadth and depth of our pipeline in 2015. We reported positive clinical data from ten drugs in development. We designed these drugs to treat patients with a wide variety of diseases. In addition, in 2015 we advanced several earlier-stage programs into clinical development, including our drug to treat patients with Huntington’s disease. We believe these earlier-stage drugs represent the next wave of new medicines with the potential to fundamentally change the treatment of diseases that are currently untreatable," continued Ms. Parshall. "The innovations we have made in our technology have the potential to add significant value to our pipeline. The substantial increase in potency conferred by our LICA technology supports weekly, monthly, quarterly or even less frequent dosing. This is a major advance and broadens the reach of our technology to larger patient populations and new therapeutic areas. The additional potency we achieved with our Generation 2.5 technology also allows us to continue to expand the opportunities for our antisense drugs."

"In 2016, we plan to complete Phase 3 studies for nusinersen, IONIS-TTRRx and volanesorsen and report data from these studies in the first half of 2017. We plan to report additional data from the open-label studies of nusinersen and IONIS-TTRRx. Data from these open-label studies continue to support the potential of these important new drugs. We will continue to provide updates as Akcea builds its commercial infrastructure and prepares to launch volanesorsen. We also plan to report data from many clinical studies, including Phase 2 data from our novel antithrombotic drug, IONIS-FXIRx, and additional clinical data on the LICA drugs we are developing. All of these activities build upon the value we have created and provide us with an event-rich year ahead," concluded Ms. Parshall.

Ionis’ 2016 goals and the full list of corporate and drug development highlights can be found at the end of this press release prior to the financial tables.

Financial Results

"Over the past several years, we have ended each year in a better financial position than when we began. During this time, we advanced three important new drugs into Phase 3 development, initiated five Phase 3 studies on these drugs, advanced 12 Phase 2 drugs and multiple Phase 1 drugs, and translated our technological innovations into the next wave of drugs to enter clinical development. Over the last several years, we have consistently increased our revenues and cash balance while decreasing our pro forma NOL reflecting the successes in our partnerships. We continued this trend in 2015 by significantly outperforming both our pro forma NOL and cash guidance. We ended the year with a pro forma NOL of $16 million, which represents a more than 70 percent improvement over our original guidance. On a GAAP basis, our operating loss was $76 million. During 2015, we received more than $320 million from our partners and ended the year with more than $775 million of cash, which is $150 million more than our original guidance. As our drugs successfully advance, we generate cash and revenue from our partners. In addition to cash and revenue, our partners provide expertise and significant additional resources, which allow us to minimize our research and development spending. Importantly, we believe these contributions will maximize the commercial value of our partnered drugs. Furthermore, with three potentially transformational medicines close to commercialization, we are looking forward to adding product revenues and royalties to our revenue base over the next few years," said Elizabeth L. Hougen, chief financial officer of Ionis Pharmaceuticals.

"In 2016, we plan to continue to progress the drugs we have in development, including our Phase 3 drugs for which we are conducting multiple Phase 3 studies. We also plan to expand our pipeline and continue to invest in advancing our technology. Akcea plans to continue conducting the pre-commercialization activities and building the global medical, marketing and sales infrastructure to successfully commercialize volanesorsen. The efficiency of our technology and our business strategy allows us to do all of this while continuing to be fiscally prudent. We are also able to advance this large agenda while maintaining a strong cash balance because of the cash we generate as our partnered programs progress. As such, we are projecting a pro forma NOL in the low $60 million range and a year-end cash balance in excess of $600 million," concluded Ms. Hougen.

All pro forma amounts referred to in this press release exclude non-cash compensation expense related to equity awards. Please refer to the reconciliation of pro forma and GAAP measures, which is provided later in this release.

Revenue

Revenue for the three and twelve months ended December 31, 2015 was $51.6 million and $283.7 million, respectively, compared to $84.9 million and $214.2 million for the same periods in 2014. Ionis’ revenue in 2015 consisted of the following:

$91.2 million from Bayer in connection with its exclusive license agreement for IONIS-FXIRx;
$72.6 million from Biogen for advancing the Phase 3 program for nusinersen, advancing IONIS-DMPK-2.5Rx and IONIS-BIIB4Rx, and validating three new targets for neurological disorders, which have proceeded forward in drug development;
$22 million from Roche for initiating a Phase 1/2 study of IONIS-HTTRx;
$20 million from GSK for advancing the Phase 3 program of IONIS-TTRRx and initiating a Phase 1 study of IONIS-GSK4-LRx; and
$77.9 million primarily from the amortization of upfront fees and manufacturing services performed for its partners.
Already in the first quarter of 2016, Ionis has generated $7 million in milestone payments from Biogen for advancing the Phase 3 program for nusinersen, advancing IONIS-BIIB4Rx and from GSK when GSK initiated the Phase 1 study for IONIS-HBV-LRx.

Ionis’ revenue fluctuates based on the nature and timing of payments under agreements with its partners and consists primarily of revenue from the amortization of milestone payments, license fees and upfront fees.

Operating Expenses

In 2015, Ionis had higher operating expenses compared to 2014 primarily due to increased spending to support the Company’s ongoing Phase 3 studies for nusinersen, IONIS-TTRRx and volanesorsen, which are in the most expensive stage of development. In addition, Akcea continued to build its operations in preparation for the commercial launch of volanesorsen. As such, Ionis’ pro forma operating expenses of $97.1 million and $300.2 million for the three and twelve months ended December 31, 2015, respectively, were higher than the $66.3 million and $230.5 million for the same periods in 2014. On a GAAP basis, Ionis’ operating expenses for the three and twelve months ended December 31, 2015 were $114.5 million and $359.5 million, respectively, compared to $74.8 million and $261.9 million for the same periods in 2014. Ionis’ operating expenses on a GAAP basis included non-cash compensation expense related to equity awards, which increased due to the increase in the Company’s stock price in January 2015 compared to January 2014.

Gain on Investment in Regulus Therapeutics Inc.

In the third quarter of 2015, Ionis received nearly $26 million of cash and recorded a $20.2 million gain on its sale of a portion of its Regulus common stock. Regulus is a satellite company partner that Ionis co-founded to discover and develop antisense drugs targeting microRNAs. In total, Ionis has received nearly $50 million since 2014 from its sale of Regulus’ common stock. Ionis now owns approximately 2.8 million shares, or approximately 5%, of Regulus’ common stock.

Net Loss

Ionis reported a net loss of $71.4 million and $88.3 million for the three and twelve months ended December 31, 2015, respectively, compared to net income of $31.1 million and a net loss of $39.0 million for the same periods in 2014. Basic and diluted net loss per share for the three and twelve months ended December 31, 2015 was $0.59 and $0.74, respectively. Basic and diluted net income per share for the three months ended December 31, 2014 was $0.26 and $0.25, respectively, while both basic and diluted net loss per share was $0.33 per share for the year ended December 31, 2014. Ionis’ increased net loss for 2015 compared to 2014 was primarily due to the increased expenses related to advancing Ionis’ large pipeline partially offset by the Company’s increase in revenue in 2015.

Balance Sheet

As of December 31, 2015, Ionis had cash, cash equivalents and short-term investments of $779.2 million compared to $728.8 million at December 31, 2014. Ionis’ cash balance increased in 2015 primarily due to the more than $320 million in cash Ionis received from its partners. Ionis’ working capital was $688.1 million at December 31, 2015 compared to $721.3 million at December 31, 2014.

On February 25, 2016 Insmed Incorporated (Nasdaq:INSM), a global biopharmaceutical company focused on the unmet needs of patients with rare diseases, reported financial results for the fourth quarter and year ended December 31, 2015 (Press release, Insmed, FEB 25, 2016, View Source [SID:1234509205]).

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Business Update

Global Phase 3 ARIKAYCE study advancing. Patient enrollment continues in the company’s global phase 3 study of ARIKAYCE (liposomal amikacin for inhalation or LAI) in nontuberculous mycobacteria (NTM) lung disease caused by Mycobacterium avium complex (MAC) (CONVERT or INS-212 study). The CONVERT study is taking place in 16 countries and more than 115 sites. The company continues to expect to achieve its enrollment objective in the second half of 2016.

EMA regulatory review of ARIKAYCE progressing. The company submitted its responses to the European Medicine Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) 120-day questions in December 2015 and expects to receive the CHMP’s 180-day list of outstanding issues (LOI) in the first quarter of 2016. Insmed anticipates responding to the LOI and participating in an oral hearing with the CHMP in the second quarter of 2016 to address the LOI on the company’s marketing authorization application (MAA) for ARIKAYCE. The company continues to expect the CHMP to render an opinion on its MAA around the middle of 2016.

Phase 1 clinical study of INS1009 underway. Insmed is conducting a phase 1 study of INS1009 in healthy subjects. INS1009 is the company’s nebulized treprostinil prodrug. The company believes INS1009 may offer a differentiated product profile with therapeutic potential in rare pulmonary disorders such as pulmonary arterial hypertension (PAH), idiopathic pulmonary fibrosis (IPF), sarcoidosis, and severe refractory asthma.

INS1009 patent issued. The U.S. patent and trademark office issued U.S. patent no. 9,255,064 (the ‘064 patent) on February 9, 2016. The ‘064 patent, entitled "Prostacyclin compounds, compositions and methods of use thereof" is the first patent to issue with claims reciting INS1009. Other treprostinil prodrugs are also claimed and described in the patent. Methods of using treprostinil prodrugs, including INS1009, are described in the patent. The ‘064 patent provides exclusivity for INS1009 until October 24, 2034.

"Last year, Insmed made important progress advancing our clinical and regulatory activities and establishing the foundation of our commercial infrastructure for ARIKAYCE in Europe," said Will Lewis, president and chief executive officer of Insmed. "We enhanced our global team and managed our resources, ending the year with $283 million in cash. In 2016, our priorities include completing patient enrollment in the phase 3 CONVERT study, advancing the European regulatory review of ARIKAYCE, and reporting new data from our internal research programs."

Fourth Quarter Financial Results

For the fourth quarter of 2015, Insmed posted a net loss of $31.2 million, or $0.51 per share, compared with a net loss of $17.6 million, or $0.36 per share, for the fourth quarter of 2014.

Research and development expenses were $19.6 million for the fourth quarter of 2015, compared with $14.8 million for the fourth quarter of 2014. The increase was primarily due to the company’s global phase 3 CONVERT study of ARIKAYCE in NTM lung disease.

General and administrative expenses for the fourth quarter of 2015 were $12.9 million, compared with $8.3 million for the fourth quarter of 2014. The increase was primarily related to pre-commercial activities in Europe and personnel-related expenses, including non-cash stock-based compensation expense.

Balance Sheet Highlights and Cash Guidance

As of December 31, 2015, Insmed had cash and cash equivalents of $283 million. The company is investing in the following activities in 2016: (i) clinical development of ARIKAYCE, (ii) regulatory and pre-commercial initiatives for ARIKAYCE, and (iii) preclinical and clinical activities for its earlier-stage pipeline. As a result, Insmed expects its cash-based operating expenses for the first half of 2016 will be in the range of $58 to $68 million

On February 25, 2016 Heat Biologics, Inc. ("Heat") (Nasdaq: HTBX), an immuno-oncology company developing novel therapies that activate a patient’s immune system against cancer, reported that the company will no longer enroll new patients in its Phase 2 monotherapy trial arm evaluating HS-410 alone for the treatment of non-muscle invasive bladder cancer (NMIBC) (Filing, 8-K, Heat Biologics, FEB 25, 2016, View Source [SID:1234509202]). Heat added the monotherapy trial arm in response to the intermittent global shortage of standard of care Bacillus Calmette-Guérin (BCG) in early 2015. The shortage has since then been resolved and as such, Heat will no longer enroll new patients in this trial arm based on discussions with the U.S. Food and Drug Administration (FDA). The decision does not relate to concerns regarding the safety profile of HS-410. The 16 patients currently enrolled, out of the anticipated 25 patients, can continue receiving HS-410 monotherapy per the study protocol. Heat anticipates reporting topline 6-month data from these 16 patients in the fourth quarter of 2016, contemporaneous with reporting data from the company’s BCG combination cohorts.

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This decision does not impact the three additional randomized Phase 2 trial arms evaluating HS-410 in combination with BCG for the treatment of NMIBC. As previously announced, Heat completed enrollment of the 75 patients for these three combination trial arms in October 2015 and continues to expect to report one-year topline efficacy, immune-response and safety data in the fourth quarter of 2016.

About HS-410 (vesigenurtacel-L)

HS-410 is an investigational product candidate for NMIBC based on Heat’s proprietary ImPACT immunotherapy platform, designed to generate CD8+ "killer" T cells that attack cancer cells. HS-410 is currently being evaluated in a Phase 2, placebo-controlled NMIBC trial at multiple centers and has been granted U.S. FDA Fast Track Designation for the treatment of NMIBC.