On August 8, 2017 Cellular Biomedicine Group Inc. (NASDAQ: CBMG) ("CBMG" or the "Company"), a clinical-stage biopharmaceutical firm engaged in the development of effective immunotherapies for cancer and stem cell therapies for degenerative diseases, reported financial results and business highlights for the second quarter and six months ended June 30, 2017 (Press release, Cellular Biomedicine Group, AUG 8, 2017, View Source [SID1234520150]).

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"In the first half of 2017, we made significant advancements in our dual technology platforms of immuno-oncology and stem cells," commented Tony (Bizuo) Liu, CBMG’s Chief Executive Officer. "In China we successfully launched two Phase I clinical trials for our anti-CD19 CAR-T product C-CAR011 and we expect to report topline clinical data from both trials by year-end. In the United States the development of AlloJoinTM, our "off-the-shelf" allogeneic adipose stem cell candidate, continues to progress with the recent $2.29 million award from California Institute for Regenerative Medicine (CIRM) to establish a cell line and IND filing in the treatment of Knee Osteoarthritis (KOA)." Mr. Liu further stated, "Upon completion of our new Shanghai GMP facility later this year, we believe we will have one of the largest cell therapy facilities in the world. The Shanghai facility will house our joint technology laboratory with GE Healthcare Life Sciences China to co-develop high-quality industrial control processes in CAR-T and stem cell manufacturing. With these recent advancements in our pipelines and validation of our GMP capabilities, we believe we will have the first mover advantage to deliver effective cell therapies in China. The recent unanimous U.S. FDA Advisory Committee approval of a large pharma’s Biological License Application (BLA) designated as Breakthrough Therapy on a CAR-T candidate for the treatment of relapsed/refractory B-cell acute lymphoblastic leukemia (ALL), and the FDA acceptance of another company’s diffuse large B-cell lymphoma (DLBCL) BLA filing under Priority Review, have set a precedent for a substantially shortened review clock for such breakthrough therapies in the United States. With both ALL and DLBCL in our pipeline, we are hopeful to see an analogous accelerated BLA review treatment in China when we are ready for our submission."

Second Quarter and First Half 2017 Financial Performance

Cash Position: Cash and cash equivalents as of June 30, 2017 were $27.3 million compared to $39.3 million as of December 31, 2016.
Net Cash Used in Operating Activities: Net cash used in operating activities for the quarter and six months ended June 30, 2017 was $2.9 million and $7.8 million (offset by $1.2 million CIRM grant in Q2), respectively, compared to $5.2 million and $8.8 million for the same periods in 2016.
G&A Expenses:General and administrative expenses for the quarter and six months ended June 30, 2017 were $3.3 million and $6.5 million, respectively, compared to $3.1 million and $5.8 million for the same periods in 2016.
R&D Expenses:Research and development expenses for the quarter and six months ended June 30, 2017 were $3.3 million and $6.4 million respectively, compared to $3.0 million and $5.4 million for the same periods in 2016.
Net Loss: Net loss allocable to common stock holders for the quarter and six months ended June 30, 2017 was $6.2 million and $12.4 million respectively, compared to $7.2 million and $11.4 million for the same periods in 2016.
Recent Business Highlights First Half 2017

Appointment of Michael A. Caligiuri, MD, current President of American Association for Cancer Research (AACR) (Free AACR Whitepaper), as Chair of the External Advisory Board;
Signed a strategic research collaboration agreement with GE Healthcare Life Sciences China to establish a joint technology laboratory in CBMG’s new Shanghai Zhangjiang GMP facility in order to co-develop control processes for the manufacture of CAR-T and stem cell therapies;
Completed expansion of our 30,000 square foot facility in Huishan High Tech Park in Wuxi, China;
Signed a ten-year lease of a 113,038 square feet building located in the "Pharma Valley" in Shanghai Zhangjiang High-Tech Park. The new GMP facility that will be built on these premises will consist of 40,000 square feet dedicated to advanced cell manufacturing.
Clinical Developments First Half 2017

Immuno-Oncology Platform

Commenced Phase I Trial (CALL-1) for C-CAR011 in adult patients with r/r B-cell ALL in China;
Commenced patient enrollment in a new independent Phase I clinical trial of the Company’s ongoing CARD-1 study in patients with chemorefractory and aggressive DLBCL;
Publication of an abstract exploring the application of B-cell antigen, CD20, for targeted Chimeric Antigen Receptor T cells (CAR-T) therapy, in conjunction with the 2017 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting.
Stem Cell Platform

Awarded $2.29 million by California Institute for Regenerative Medicine (CIRM), California’s stem cell agency, to support pre-clinical studies of AlloJoinTM, CBMG’s "off-the-shelf" allogeneic human adipose-derived mesenchymal stem cells (haMPC) for the treatment of KOA in the United States.

On August 8, 2017 Celldex Therapeutics, Inc. (NASDAQ:CLDX) reported business and financial highlights for the second quarter ended June 30, 2017 (Press release, Celldex Therapeutics, AUG 8, 2017, View Source [SID1234520147]).

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"In the second quarter, we continued to see strong physician enthusiasm for our Phase 2 METRIC study of glembatumumab vedotin in triple negative breast cancer and recently met our target enrollment of 300 patients," said Anthony Marucci, Co-founder, President and Chief Executive Officer of Celldex Therapeutics. "We expect enrollment will be formally closed by the end of September to allow all patients currently in the screening queue the opportunity to complete the screening process and enroll in the study."

"In June, we presented data from glemba’s Phase 2 program in checkpoint refractory metastatic melanoma and the Phase 1 dose-escalation varlilumab/Opdivo combination study in solid tumors, both in oral presentations at ASCO (Free ASCO Whitepaper). We anticipate a productive second half of the year as we complete enrollment across multiple early-stage studies and look forward to topline data from the METRIC study in the first half of 2018."

Recent Highlights

Continued progress in METRIC enrollment: Target enrollment (n=300) in METRIC has been reached. Given the lack of treatment options for patients with triple negative breast cancers, previously screened patients whose tumors overexpress gpNMB will be allowed to enter the study before enrollment is formally completed, which is estimated to occur by the end of September 2017. The Company expects topline data from the study approximately six to eight months after formal closing of enrollment. METRIC is a Phase 2b randomized study of glembatumumab vedotin in patients with metastatic triple negative breast cancers that overexpress gpNMB.

Single-agent glembatumumab vedotin Phase 2 study in checkpoint-refractory metastatic melanoma presented in an oral presentation at American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) in June: Mature data (n=62) from the study were presented at ASCO (Free ASCO Whitepaper). As previously reported in October 2016, the primary endpoint of the cohort (threshold of 6 or more objective responses in 52 evaluable patients) was exceeded. 7 of 62 (11%) patients experienced a confirmed response, and an additional three patients also experienced single timepoint partial responses. Since data were reported in October, one patient converted from a confirmed partial response to a confirmed complete response. Median overall survival (OS) for all patients was 9.0 months (95% CI: 6.1, 13.0). Patients who experienced rash in Cycle 1 experienced a more prolonged OS with a median of 15.8 months (p=0.026, HR=0.44) as compared to those who did not experience rash.

Enrollment recently completed in the glembatumumab vedotin and varlilumab combination arm, and data from this portion of the study are expected in the fall of 2017. Enrollment continues in the glembatumumab vedotin plus checkpoint inhibitor (Opdivo or Keytruda) arm in patients who failed prior checkpoint therapy, a population with limited treatment options.

Phase 1 varlilumab/Opdivo study presented in an oral presentation at ASCO (Free ASCO Whitepaper): Updated data (n=36) from the Phase 1 portion of this study were presented at ASCO (Free ASCO Whitepaper). The majority of patients enrolled in this study had PD-L1 negative tumor at baseline and presented with stage IV, heavily-pretreated disease. 80% of patients enrolled presented with refractory or recurrent colorectal (n=21) or ovarian cancer (n=8), a population expected to have minimal response to checkpoint blockade. The primary objective of the Phase 1 portion of the study was to evaluate the safety and tolerability of the combination. The combination was well tolerated at all varlilumab dose levels tested without any evidence of increased autoimmunity or inappropriate immune activation. Notable disease control was observed across multiple dosing regimens (stable disease or better for at least 3 months). Three partial responses (PR) were observed including a patient with PD-L1 negative, MMR proficient colorectal cancer, a patient with low PD-L1 (5% expression) squamous cell head and neck cancer and a patient with PD-L1 negative ovarian cancer. A subgroup analysis was conducted in patients with ovarian cancer based on an observed increase of PD-L1 and tumor-infiltrating lymphocytes in this patient population. In patients with paired baseline and on-treatment biopsies (n=13), only 15% were PD-L1 positive (≥ 1% tumor cells) at baseline compared to 77% during treatment (p=0.015). Patients with increased tumor PD-L1 expression and tumor CD8 T cells correlated with better clinical outcome with treatment (stable disease or better).

The Phase 2 portion of the combination study includes cohorts in colorectal cancer, ovarian cancer, head and neck squamous cell carcinoma, renal cell carcinoma and glioblastoma, and is currently enrolling patients. The Company plans to complete enrollment across all cohorts in the Phase 2 portion of the study in the first quarter of 2018 and will work with Bristol-Myers Squibb to present data from the study at a future medical meeting.

Phase 1 study of CDX-0158 continues to enroll patients: This dose escalation study in patients with advanced refractory gastrointestinal stromal tumors (GIST) and other KIT-positive tumors is designed to determine the maximum tolerated dose, recommend a dose for further study and characterize the safety profile of CDX-0158. Data from the study continue to be expected by year-end 2017.

CDX-3379 advancing to Phase 2: The Company has finalized plans for an open-label Phase 2 study in patients with recurrent/metastatic head and neck squamous cell cancer who are refractory to Erbitux (cetuximab). The Company anticipates initiating this study in the fourth quarter of 2017.

Enrollment ongoing in Phase 1 study of CDX-014: This study in advanced renal cell carcinoma (clear cell and papillary) is designed to determine the maximum tolerated dose and to recommend a dose level for further study. Celldex continues to expect the Phase 1 dose-escalation portion of the study will complete enrollment by year-end 2017.
Second Quarter and First Six Months 2017 Financial Highlights and Updated 2017 Guidance

Cash position: Cash, cash equivalents and marketable securities as of June 30, 2017 were $154.0 million compared to $167.0 million as of March 31, 2017. The decrease was primarily driven by second quarter cash used in operating activities of $20.8 million. This decrease was partially offset by the receipt of $8.7 million from sales of common stock under the Cantor agreement. At June 30, 2017, Celldex had 127.4 million shares outstanding.

Revenues: Total revenue was $3.8 million in the second quarter of 2017 and $5.4 million for the six months ended June 30, 2017, compared to $1.4 million and $2.7 million for the comparable periods in 2016. The increase in revenue was primarily due to the manufacturing service agreement with the International AIDS Vaccine Initiative.

R&D Expenses: Research and development (R&D) expenses were $25.0 million in the second quarter of 2017 and $50.8 million for the six months ended June 30, 2017, compared to $25.7 million and $53.2 million for the comparable periods in 2016.

The $0.7 million decrease in second quarter R&D expenses was primarily due to a decrease in varlilumab contract manufacturing expenses of $4.3 million, partially offset by an increase in glembatumumab vedotin contract manufacturing expenses of $1.9 million and increases in personnel and facility costs related to the Kolltan acquisition.

The $2.4 million decrease in year-to-date R&D expenses was primarily due to decreases in varlilumab and Rintega contract manufacturing expenses of $5.1 million and $2.6 million, respectively, partially offset by an increase in glembatumumab vedotin contract manufacturing expenses of $3.4 million and increases in personnel and facility costs related to the Kolltan acquisition.

G&A Expenses: General and administrative (G&A) expenses were $6.5 million in the second quarter of 2017 and $13.8 million for the six months ended June 30, 2017, compared to $7.8 million and $17.1 million for the comparable periods in 2016.

The $1.3 million decrease in second quarter G&A expenses was primarily due to lower commercial planning costs of $0.6 million and lower stock-based compensation of $0.4 million.

The $3.3 million decrease in year-to-date G&A expenses was primarily due to lower commercial planning costs of $2.4 million and lower stock-based compensation of $0.9 million.

Loss on Fair Value Remeasurement of Contingent Consideration: Loss on the fair value remeasurement of contingent consideration related to the Kolltan acquisition was $1.0 million in the second quarter of 2017 and $4.4 million for the six months ended June 30, 2017, primarily due to changes in discount rates and the passage of time.

Net loss: Net loss was $28.6 million, or ($0.23) per share, for the second quarter of 2017 and $62.8 million, or ($0.51) per share, for the six months ended June 30, 2017, compared to a net loss of $32.0 million, or ($0.32) per share, and $66.6 million, or ($0.67) per share, for the comparable periods in 2016.

Financial guidance: Celldex believes that the cash, cash equivalents and marketable securities at June 30, 2017, combined with the anticipated proceeds from future sales of common stock under the Cantor agreement, are sufficient to meet estimated working capital requirements and fund planned operations through 2018; however, this guidance assumes Celldex elects to pay future Kolltan contingent milestones, if any, in stock rather than cash.

On August 8, 2017 Cascadian Therapeutics, Inc. (NASDAQ:CASC), a clinical-stage biopharmaceutical company, reported financial results for the second quarter ended June 30, 2017, and provided an update on tucatinib, an investigational oral, small molecule kinase inhibitor that is highly selective for HER2 and the Company’s lead product in development (Press release, Cascadian Therapeutics, AUG 8, 2017, View Source [SID1234520146]).

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"During the second quarter, we were pleased to receive confirmation from the European Medicines Agency (EMA) that HER2CLIMB, if positive, could serve as a single registrational trial for submission to the European regulators for potential marketing approval, and that tucatinib was granted orphan drug designation by the U.S. Food and Drug Administration (FDA) for the treatment of breast cancer patients with brain metastases," said Scott Myers, President and CEO of Cascadian Therapeutics. "We are now enrolling patients in HER2CLIMB on three continents. We are pleased with site activations and patient enrollment, which are currently ahead of our projections in North America."

Second Quarter and Recent Highlights

In July 2017, the Company announced that it received confirmation from the EMA that positive results from its ongoing pivotal trial of tucatinib, known as HER2CLIMB, could serve as a single registrational trial for submission of a Marketing Authorization Application to the EMA and potential marketing approval. The Company had received similar confirmation from the FDA in 2016.

In June 2017, the Company announced that tucatinib was granted orphan drug designation by the FDA for the treatment of breast cancer patients with brain metastases.
Second Quarter Financial Results

Cash, cash equivalents and investments totaled $125.4 million as of June 30, 2017, compared to $62.8 million at December 31, 2016. The increase was primarily due to the result of net proceeds of $88.0 million from the Company’s January 2017 financing, less cash used in operations of $24.8 million.

Net loss attributable to common stockholders for the three months ended June 30, 2017 was $14.7 million, or $0.30 per share, compared with a net loss attributable to common stockholders of $25.1 million, or $1.57 per share, for the comparable period in 2016. The $10.4 million decrease in net loss attributable to common stockholders for the quarter was primarily due to the non-cash intangible asset impairment charge of $19.7 million offset by a $6.9 million tax benefit related to the reversal of the deferred tax liability. Both amounts were recorded in connection with the termination of the STC.UNM license agreement in 2016. The decrease was offset by an increase in research and development expenses of $5.1 million primarily due to greater activity related to the development of the Company’s product candidates.

Net loss attributable to common stockholders for the six months ended June 30, 2017 was $27.1 million, or $0.60 per share, compared to a net loss attributable to common stockholders of $38.0 million, or $2.39 per share, for the same period in 2016. The $10.9 million decrease in net loss attributable to common stockholders for the six months ended June 30, 2017 was primarily due to the non-cash intangible asset impairment charge of $19.7 million offset by a $6.9 million tax benefit related to the reversal of the deferred tax liability. Both of these amounts were recorded in connection with the termination of the STC.UNM license agreement in 2016. In addition, the decrease was due to lower general and administrative expenses of $4.5 million primarily due to compensation-related expenses in connection with management changes in the first quarter of 2016 and lower non-cash expense from the deemed dividend related to the beneficial conversion feature on convertible preferred stock. The decrease in net loss attributable to common stockholders were partially offset by increases in research and development expenses of $7.4 million due to greater activity related to the development of the Company’s product candidates.

2017 Financial Outlook

Cascadian Therapeutics expects operating expenses in 2017 to be slightly higher than in 2016, primarily due to an increase in activities related to the ongoing worldwide HER2CLIMB pivotal trial. Cash used in operations for 2017 is expected to be approximately $50.0 million to $54.0 million.

Cascadian Therapeutics believes the above financial guidance to be correct as of the date provided and is providing the guidance as a convenience to investors and assumes no obligation to update it.

On August 8, 2017 Bellicum Pharmaceuticals, Inc. (Nasdaq:BLCM), a leader in developing novel, controllable cellular immunotherapies for cancers and orphan inherited blood disorders, reported financial results for the second quarter ended June 30, 2017, and provided an update on recent developments (Press release, Bellicum Pharmaceuticals, AUG 8, 2017, View Source;p=RssLanding&cat=news&id=2292700 [SID1234520145]).

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"Since I joined the Company six months ago, we have conducted a thorough review of our strategy and operations, and are very optimistic about the opportunities before us," said Rick Fair, Bellicum’s President & Chief Executive Officer. "We continue to be encouraged by the results from our ongoing BPX-501 pediatric studies and our progress toward a filing in Europe. We have adjusted our plans for U.S. registrational trials to enable an efficient path to seeking approvals for the greatest areas of unmet need. Lastly, we continue to be excited about the clinical progress of our CAR T and TCR product candidates, and the application of our molecular switch platform for future pipeline expansion."

PROGRAM HIGHLIGHTS AND CURRENT UPDATES

BPX-501
Adjunct T-cell therapy incorporating the CaspaCIDe safety switch, administered after a haploidentical hematopoietic stem cell transplant (haplo-HSCT), to improve outcomes and reduce mortality

Data Update Suggests BPX-501 Improves Outcomes of Haploidentical Stem Cell Transplants
During the Presidential Symposium of the 22nd Congress of the European Hematology Association (EHA) (Free EHA Whitepaper) in June, Bellicum reported data from 98 pediatric patients within the BP-004 trial which showed rapid immune recovery, a low incidence of transplant-related mortality, a reduction in viral infections and a low rate of Graft versus Host Disease (GvHD) that was manageable with either standard treatments or rimiducid. The data suggest BPX-501 could improve outcomes of haploidentical stem cell transplants, providing an option for the many patients who could benefit from a life-saving transplant but lack a matched donor.

Positive Clinical Results of BPX-501 in Pediatric Leukemias
Also at EHA (Free EHA Whitepaper), Bellicum reported data from the BP-004 trial in a cohort of 47 pediatric patients with acute leukemias who lack a matched donor. The data showed rapid immune reconstitution and low rates of relapse and mortality, suggesting that BPX-501 may offer benefits in combination with HSCT in acute leukemia patients.

European BP-004 Pivotal Clinical Trial Progressing
Enrollment in the pivotal EU BP-004 trial remains on track for completion by the end of 2017. Bellicum expects to initiate an observational trial in pediatric patients receiving transplants from matched unrelated donors (MUD) without BPX-501 in the third quarter. Outcomes from these trials are expected to be the basis for filings of European Marketing Authorization Applications for BPX-501 and rimiducid. The Company expects to report top-line results of these studies in the second half of 2018, with MAA filings planned for 2019.

Company Clarifies U.S. Clinical Development Strategy
Bellicum is finalizing plans for the design of registrational trials of BPX-501 in the U.S. The Company’s current plans include conducting a controlled clinical trial in adult patients with acute myeloid leukemia (AML), which it expects to fund in part through its $16.9 million Product Development Award from the Cancer Prevention and Research Institute of Texas ("CPRIT"). In the pediatric non-malignant setting, Bellicum is designing a registrational trial to evaluate BPX-501 in a distinct subset of orphan inherited blood disorders.
BPX-601

Phase 1 BPX-601 Clinical Trial Continues
BPX-601 is Bellicum’s novel GoCAR-T product candidate, which is designed with its proprietary iMC activation switch to allow control over the level of stimulation and proliferation of the modified T cells. Enrollment and treatment is ongoing in Bellicum’s Phase 1 trial in patients with nonresectable pancreatic cancer who test positive for prostate stem cell antigen (PSCA).
BPX-701

Phase 1 BPX-701 Clinical Trial Continues
BPX-701 is a high affinity TCR product candidate designed with the CaspaCIDe safety switch, enabling the elimination or reduction of the engineered cells in the event of severe toxicities. Dosing has been initiated in the Company’s Phase 1 clinical trial in patients with refractory or relapsed AML and myelodysplastic syndromes (MDS) who test positive for preferentially-expressed antigen in melanoma (PRAME).
CORPORATE UPDATE

Addition of Chief Business Officer to Expand Partnership Opportunities
Greg Naeve, Ph.D., an accomplished product strategy and business development executive, is joining Bellicum’s leadership team in August 2017 from Pfizer, where he led efforts to identify and implement multiple strategic partnerships and translational science collaborations across Pfizer Worldwide R&D, including CAR T alliances with Cellectis and Servier.
PRECLINICAL RESEARCH

In April, Bellicum reported positive preclinical data at AACR (Free AACR Whitepaper) on its novel dual-switch technology incorporated into CAR T and TCR constructs, an approach offering the possibility of both activating cells to enhance efficacy and eliminating them to manage toxicity. Bellicum is working to incorporate its dual-switch technology into future CAR T and TCR product candidates.

The Company continues to work with academic collaborators to explore the applicability of CaspaCIDe in CD19 CARs, the first of which is expected to enter the clinic in the second half of this year in patients with B-cell malignancies.
SECOND QUARTER AND SIX MONTHS ENDED JUNE 30, 2017 FINANCIAL RESULTS

Bellicum reported a net loss of $24.5 million for the second quarter of 2017 and $46.4 million for the six months ended June 30, 2017, compared to a net loss of $16.5 million and $31.6 million for the comparable periods of 2016. The results included non-cash, share-based compensation charges of $3.2 million and $6.6 million for the second quarter and six months ended June 30, 2017 and $3.1 million and $6.2 million for the comparable periods in 2016.

As of June 30, 2017, cash, restricted cash and investments totaled $139.0 million. Based on current operating plans, Bellicum continues to expect to end 2017 with approximately $85 to $95 million in cash and investments, and that current cash resources will be sufficient to meet operating requirements through 2018.

Research and development expenses were $18.0 million and $33.3 million, for the three and six months ended June 30, 2017, respectively, compared to $12.0 million and $22.9 million during the comparable periods in 2016. The higher expenses in the 2017 periods were primarily due to an increase in clinical development and manufacturing costs due to increased enrollment in trials, principally BPX-501, and increased personnel expenses, overhead charges and manufacturing facility start-up costs.

General and administrative expenses were $5.5 million and $11.4 million for the three and six months ended June 30, 2017, respectively, compared to $4.2 million and $8.5 million during the comparable periods in 2016. The higher expenses in the 2017 periods were primarily due to the Company’s overall growth, including an increase in personnel related costs, principally due to hiring additional employees and severance costs, higher facility costs and increased legal, accounting and travel expenses.

At June 30, 2017, Bellicum had 33,193,229 shares of common stock outstanding.

On August 8, 2017 Valeant Pharmaceuticals International, Inc. (NYSE: VRX) (TSX: VRX) ("Valeant" or the "Company" or "we") reported its second-quarter 2017 financial results (Press release, Valeant, AUG 8, 2017, http://ir.valeant.com/news-releases/2017/08-08-2017-120421466 [SID1234520078]).

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"The investments we are making in our core business are delivering results," said Joseph C. Papa, chairman and chief executive officer, Valeant. "The Bausch + Lomb/International segment and Salix business, which together represented 73 percent of our revenue in the quarter, delivered strong organic growth1, and we are continuing to reduce debt and resolve legacy issues."

"Additionally, we confirm that we are maintaining our 2017 full-year Adjusted EBITDA guidance range despite the impact of divestitures we’ve made this year," added Mr. Papa.

Company Highlights

Strengthening the Balance Sheet

Completed sale of Dendreon Pharmaceuticals LLC and used net proceeds to pay down $811 million of senior secured term loans

Announced that Valeant will redeem the remaining $500 million aggregate principal amount of our outstanding 6.75% Senior Notes due 2018, using cash on hand, on Aug. 15, 2017. Upon redemption, the Company expects to:

Have reduced total debt by more than $4.8 billion since the end of the first quarter of 2016

Have no debt maturities and no mandatory amortization requirements until 2020

Announced agreements to sell iNova Pharmaceuticals and Obagi Medical Products businesses for $930 million and
$190 million in cash, respectively; both remain on track to close in the second half of 2017

Generated $268 million and $1.222 billion in cash flow from operations in the second quarter and for the six months that ended June 30, 2017, respectively

Delivered GAAP net loss of $38 million and Adjusted EBITDA (non-GAAP) of $951 million

Achieving positive outcomes in resolving and managing litigation and investigations, including settling the Salix
securities class action litigation

Expects to exceed commitment to pay down $5 billion in debt from divestiture proceeds and free cash flow before February 2018

Executing on Core Businesses

Grew revenue in the Salix business by 13% compared to the second quarter of 2016 and organically grew1 revenue in the Salix business by 16% compared to the second quarter of 2016

XIFAXAN (rifaximin) revenues rose by 16% compared to the second quarter of 2016

Strong XIFAXAN growth, with prescriptions up 6% sequentially and 2% versus the second quarter of 2016, and extended Rx unit volume up 4% versus second quarter of 2016

APRISO (mesalamine) prescriptions grew by 7% compared to the second quarter of 2016

RELISTOR (methylnaltrexone bromide) prescriptions grew by 33% compared to the second quarter of 2016

Revenue of the Bausch + Lomb/International segment decreased by 3% compared to the second quarter of 2016; however, the segment revenue increased organically1 by approximately 6% compared to the second quarter of 2016

Grew revenue in the Bausch + Lomb business in China by 4% compared to the second quarter of 2016 despite currency headwinds and organically grew1 revenue in this business by 9%, compared to the second quarter of 2016, driven by volume

Advanced Bausch + Lomb business

Introduced Bausch + Lomb AQUALOX bi-weekly contact lenses in Japan in June

Introduced Bausch + Lomb renu Advanced Formula multi-purpose contact lens solution

Received filing acceptance from the U.S. Food and Drug Administration (FDA) for the New Drug Application (NDA) for Luminesse2 (brimonidine tartrate ophthalmic solution, 0.025%) with a PDUFA action date of Dec. 27, 2017

Received FDA 510(k) clearances for Vitesse and Stellaris Elite Vision Enhancement System

Continued to focus on stabilizing the dermatology business

Launched SILIQ (brodalumab) injection in July as the lowest-priced injectable biologic for moderate-to-severe plaque psoriasis in the United States

Rebranded the business as Ortho Dermatologics in July

Received FDA filing acceptance for the NDA for PLENVU2 (NER1006), a novel, low volume polyethylene glycol-based bowel preparation for colonoscopies

Second-Quarter Revenue Performance
Total revenues were $2.233 billion for the second quarter of 2017, as compared to $2.420 billion in the second quarter of 2016, a decrease of $187 million, or 8%. The decrease was primarily driven by decreases in volume and price in our U.S. Diversified Products segment, attributed to the previously reported loss of exclusivity for a basket of products, and the dermatology business. The decline also reflects the unfavorable impact of divestitures and discontinuations, primarily the skincare divestiture within the Bausch + Lomb/International segment.3

Revenues by segment for the second quarter of 2017 were as follows:
$ in millions
2017
2016
Reported
Change
Reported
Change
Change at
Constant
Currency4
Organic
Growth1
Segment

Bausch + Lomb/International
$1,241
$1,277
$(36)
(3%)
1%
6%
Branded Rx
$636
$653
$(17)
(3%)
(3%)
0%
U.S. Diversified Products
$356
$490
$(134)
(27%)
(27%)
(27%)
Total Revenues
$2,233
$2,420
$(187)
(8%)
(5%)
(3%)

Bausch + Lomb/International Segment
The Bausch + Lomb/International segment revenues were $1.241 billion for the second quarter of 2017, as compared to $1.277 billion for second quarter of 2016, a decrease of $36 million, or 3%. Excluding the impact of the skincare divestiture and foreign exchange, the Bausch + Lomb/International segment organically grew1 by approximately 6% compared to the second quarter of 2016, driven by performance in China, Europe and Africa/Middle East and the Global Ophthalmology business.

Branded Rx Segment
The Branded Rx segment revenues were $636 million for the second quarter of 2017, as compared to $653 million for second quarter of 2016, a decrease of $17 million, or 3%. The decrease in sales primarily was due to lower volumes in the dermatology business and the impact of divestitures and discontinuations in the Salix business. The decline was largely offset by 13% revenue growth in the Salix business compared to the second quarter of 2016, despite the impact of the divestiture of Ruconest, and organic growth1 in the Salix business of 16% compared to the second quarter of 2016.

U.S. Diversified Products Segment
The U.S. Diversified Products segment revenues were $356 million for the second quarter of 2017, as compared to $490 million for second quarter of 2016, a decrease of $134 million, or 27%. The decline was primarily driven by decreases in volume and price attributed to the previously reported loss of exclusivity for a basket of products.

Operating Income
Operating income was $175 million for the second quarter of 2017 as compared to $81 million for the second quarter of 2016, an increase of $94 million. The increase in operating income primarily reflects lower asset impairments and amortization charges partially offset by a decrease in contribution margin as a result of the decline in product sales from existing businesses.

Net loss for the three months ended June 30, 2017 was $38 million, as compared to $302 million for the same period in 2016, an improvement of $264 million. The decrease in net loss primarily reflects the increase in recovery for income taxes, increase in operating income and the net change in foreign exchange.

Cash provided by operating activities was $268 million for the second quarter of 2017. Cash flows from operations were negatively affected by $190 million of net payments made in resolution of the Salix securities class action litigation.5 Excluding these payments, the Company generated a normalized cash flow of $458 million.
GAAP Earnings Per Share (EPS) Diluted – for the second quarter of 2017 came in at $(0.11) as compared to $(0.88) in the second quarter of 2016.

Adjusted EBITDA(non-GAAP)
Adjusted EBITDA (non-GAAP) was $951 million for the second quarter of 2017, as compared to $1.087 billion for the second quarter of 2016, a decrease of $136 million, primarily due to lower revenues attributed to the previously reported loss of exclusivity for a basket of products, divestitures and discontinuations, and declines in our dermatology business, partially offset by strong organic growth1 in the Bausch + Lomb/International segment and the Salix business. Adjusted EBITDA grew by 10% sequentially versus the prior quarter.

2017 Guidance
Valeant has updated guidance for 2017, as follows:
Full-Year Revenues in the range of $8.70 – $8.90 billion from $8.90 – $9.10 billion
The Company confirms we will maintain our full-year Adjusted EBITDA (non-GAAP) guidance range of $3.60 – $3.75 billion despite the impact of divestitures that have closed in 2017.

This updated guidance reflects the impact of the sale of the CeraVe, AcneFree and AMBI skincare brands and the sale of Dendreon Pharmaceuticals LLC. This guidance does not reflect the impact of the sales of the iNova Pharmaceuticals and Obagi Medical Products businesses, which are both expected to close in the second half of the year.

Other than with respect to GAAP Revenues, the Company only provides guidance on a non-GAAP basis. The Company does not provide a reconciliation of forward-looking Adjusted EBITDA (non-GAAP) to GAAP net income (loss), due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. In periods where significant acquisitions or divestitures are not expected, the Company believes it might have a basis for forecasting the GAAP equivalent for certain costs, such as amortization, which would otherwise be treated as non-GAAP to calculate projected GAAP net income (loss). However, because other deductions (such as restructuring, gain or loss on extinguishment of debt and litigation and other matters) used to calculate projected net income (loss) vary dramatically based on actual events, the Company is not able to forecast on a GAAP basis with reasonable certainty all deductions needed in order to provide a GAAP calculation of projected net income (loss) at this time. The amount of these deductions may be material and, therefore, could result in projected GAAP net income (loss) being materially less than projected Adjusted EBITDA (non-GAAP).

Additional Highlights
Valeant’s cash, cash equivalents and restricted cash were $2.025 billion at June 30, 2017
The Company’s availability under the Revolving Credit Facility was approximately $930 million at June 30, 2017
Valeant’s corporate credit ratings remained unchanged during the second quarter of 2017
John Paulson, president of Paulson & Co., Inc., a New York-based investment firm, joined the Company’s Board of Directors