On May 1, 2018 Zymeworks Inc. (NYSE/TSX: ZYME), a clinical-stage biopharmaceutical company developing multifunctional therapeutics, today reported financial results for the quarter ended March 31, 2018 (Press release, Zymeworks, MAY 1, 2018, View Source [SID1234525902]).

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"Over the last few months we have added to our clinical and business momentum," said Ali Tehrani, Ph.D., Zymeworks’ President & CEO. "In addition to the milestones highlighted below, we continue to be encouraged by the clinical progress of our lead candidate, ZW25, and are honored that the updated data was selected for an oral presentation at the upcoming American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) annual meeting next month.

First Quarter 2018 Business Highlights and Recent Developments

Added New Clinical Sites for ZW25 in Canada and the United States; Data Selected for Oral Presentation at ASCO (Free ASCO Whitepaper)
To give more clinicians access to its novel bispecific antibody, Zymeworks announced the opening of new sites in Canada and the United States for its ongoing adaptive Phase 1 study of ZW25. Updated data, from the dose escalation and expansion cohort parts of the study, will be highlighted at an oral presentation at the upcoming ASCO (Free ASCO Whitepaper) annual meeting in Chicago.
Identified ZW49, a Novel Antibody-Drug Conjugate (ADC), as a Clinical Candidate
ZW49 is a proprietary bispecific ADC targeting two distinct locations of the HER2 receptor resulting in enhanced delivery of Zymework’s proprietary ZymeLink cytotoxic payload to cancer cells. Preclinical data, presented at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) annual meeting in April demonstrated ZW49 to be active and well tolerated in models of high and low HER2-expressing cancers. Zymeworks expects to file an Investigational New Drug (IND) application this year in order to begin a clinical trial with ZW49.
Expanded Corporate Collaboration with Celgene
Zymeworks has expanded its relationship with Celgene. Under the terms of the agreement, the research program term has been extended by two years and additional licenses for two products have been added for a total of 10 potential products under the collaboration. Zymeworks is entitled to receive an expansion fee and is eligible to receive up to US$328 million in additional development and commercial milestones resulting in total future potential milestones of US$1.64 billion, plus royalties on worldwide sales.
Financial Results for the Quarter Ended March 31, 2018

Revenue for the three months ended March 31, 2018 was $0.04 million as compared to $0.23 million in the same period in 2017, primarily due to a $0.2 million decrease in research support payments from Daiichi Sankyo as research and development activities under the agreement with Daiichi Sankyo shifted to our partner.

For the three months ended March 31, 2018, research and development expenditures were $13.1 million as compared to $9.1 million for the same period in the prior year. This was primarily due to an increase in clinical costs for ZW25 and development costs for ZW49 in 2018, which was partially offset by a decrease in early stage research and development activities in platform technologies compared to the same period in 2017. General and administrative expenses were $7.1 million for the three months ended March 31, 2018 and $6.3 million for the same period in 2017. The change between the periods was primarily due to an increase in compensation costs and professional fees. The compensation costs increase was the result of new hires as well as an increase in stock-based compensation expense.

The net loss for the three months ended March 31, 2018 increased to $21.2 million as compared to $15.9 million for the same period in 2017, primarily due to increased research & development and general administrative expenses, as well as increase in the fair value of warrant liabilities which was partially offset by impairment charges recorded in 2017. Zymeworks expects research and development expenditures to increase over time due to the ongoing development of product candidates and other clinical, preclinical, and regulatory activities.

As of March 31, 2018, Zymeworks had $70.0 million in cash and cash equivalents and short-term investments. Zymeworks expects to continue receiving revenue from its existing and future corporate collaborations, including technology access fees, research and development fees for services rendered, and milestone-based payments. However, Zymeworks’ ability to receive these payments is dependent upon either Zymeworks or its collaborators successfully completing specified research and development activities.

On May 1, 2018 Veracyte, Inc. (Nasdaq: VCYT) reported financial results for the first quarter ended March 31, 2018 and provided an update on recent business progress. For the first quarter of 2018, revenue was $20.0 million, an increase of 22%, compared to $16.4 million for the first quarter of 2017 (Press release, Veracyte, MAY 1, 2018, View Source [SID1234525901]).

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"We had a great quarter in which we beat revenue and genomic test volume growth expectations and generated strong momentum across our business," said Bonnie Anderson, chairman and chief executive officer of Veracyte. "Our team converted the majority of our thyroid business to the next-generation Afirma Genomic Sequencing Classifier, gained in-network status with Anthem and significantly accelerated our Percepta business. Additionally, we unveiled our new, RNA sequencing-based Afirma Xpression Atlas, which positions us to deliver even more value to physicians, while enabling new collaborations – beginning with Loxo Oncology – to help advance precision medicine efforts."

First Quarter 2018 Financial Results

For the first quarter of 2018, as compared to the first quarter of 2017:

Revenue was $20.0 million, an increase of 22%;
Genomic Volume was 6,864, an increase of 18%;
Gross Margin was 61%, a decline of 1%;
Operating Expenses, Excluding Cost of Revenue were $21.1 million, an increase of 20%;
Net Loss and Comprehensive Loss was ($9.2) million, an increase of 12%;
Basic and Diluted Net Loss Per Common Share was ($0.27), an increase of 13%;
Cash Burn1 was $7.6 million, an improvement of 8%; and
Cash and Cash Equivalents was $27.2 million at March 31, 2018.
1 A reconciliation of net cash used in operating activities to cash burn has been provided in the financial statement tables included in this press release. An explanation of cash burn is also included below under the heading "Non-GAAP Financial Measures."

First Quarter 2018 and Recent Business Highlights

Commercial Growth:

Reported 6,864 genomic tests in the first quarter of 2018, representing 18% growth as compared to the first quarter of 2017, and transitioned approximately 70% of the company’s thyroid business to the next-generation Afirma Genomic Sequencing Classifier (GSC), ahead of plan; and
Doubled the number of institutions that submitted samples for Percepta testing in the first quarter of 2018, compared to the fourth quarter of 2017.
Reimbursement Expansion:

Executed an in-network contract with Anthem, an independent Blues plan and one of the nation’s largest health benefits companies. This achievement nearly completes Veracyte’s contracting efforts to make the Afirma classifier available to patients nationally as an in-network service.
Evidence Development:

Presented the first real-world clinical utility data for the Afirma GSC at ENDO 2018 demonstrating that the genomic test enabled significantly more patients to avoid unnecessary thyroid surgery, compared to the original Afirma test;
Published the INTENSITY study in BMC Pulmonary Medicine, quantifying the challenges of obtaining an IPF diagnosis and the resulting negative impact on patients – and underscoring the clinical need for the Envisia classifier; and
Received acceptance of an abstract for a validation study demonstrating the performance of the Afirma Xpression Atlas to be presented at the American Association of Clinical Endocrinologists’ (AACE) 27th Annual Scientific & Clinical Congress in May 2018.
Scientific Innovation:

Unveiled the Afirma Xpression Atlas, an extension of the Afirma GSC, at ENDO 2018 in an oral presentation detailing the RNA sequencing-based platform’s ability to derive rich genomic content – 761 DNA variants and 130 RNA fusions in over 500 genes that are associated with thyroid cancer – from thyroid fine needle aspiration samples; and
Entered into a research collaboration with Loxo Oncology, which will leverage Veracyte’s Afirma Xpression Atlas platform to advance Loxo Oncology’s development of therapies for patients with genetically defined cancers, including thyroid cancer.
Updated 2018 Financial Outlook

Veracyte is increasing its 2018 annual revenue guidance to $83 million to $86 million, from its prior guidance of $81 million to $83 million. The company reiterates its annual cash burn guidance of $18 million to $22 million.

On May 1, 2018 -Siamab Therapeutics, Inc., a biopharmaceutical company developing novel glycan-targeted cancer therapeutics, reported the publication of new preclinical data for its ST1 antibody drug conjugate (ADC) targeting the tumor-associated carbohydrate antigen (TACA) Sialyl-Tn (STn) (Press release, Siamab Therapeutics, MAY 1, 2018, View Source [SID1234525900]). STn is present on multiple solid tumors and is associated with a chemoresistant population in ovarian cancer. The findings show that ST1-ADC selectively inhibits tumor cell proliferation and induces tumor cell death in both in vitro and in vivo ovarian cancer models. ST1, Siamab’s lead program, is in late stage preclinical development for the treatment of STn-expressing solid tumors. The data, generated through a collaboration with Bo Rueda, Ph.D., Director of The Vincent Center for Reproductive Biology at Massachusetts General Hospital, have been published online in the journal Oncotarget.

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The published study results show that STn is expressed on ovarian cancer cells and is frequently co-expressed with the established ovarian cancer stem cell (CSC) marker CD133. Importantly, STn positive and CD133 positive cells persist following cytotoxic chemotherapy. Furthermore, the results show that treatment with Siamab’s ST1 ADCs reduced the viability of STn positive ovarian cancer cell lines in vitro and reduced tumor volume in vivo in an ovarian cancer xenograft mouse model, depleting STn positive tumor cells. No significant changes in mouse weight were observed during treatment and no other toxicities were noted.

"These findings are important as they hold promise for the development of new therapeutic options to treat ovarian cancer," said Jeff Behrens, president and chief executive officer of Siamab. "The results show that targeting the STn antigen expressed on ovarian tumor cells and, critically, chemoresistant cells, with an anti-STn ADC can selectively inhibit tumor cell proliferation and induce tumor cell death in both in vitro and in vivo models. Furthermore, the studies suggest that either combination or sequential coupling of anti-STn therapy with conventional cytotoxic chemotherapy could target both bulk tumor and chemoresistant cells that play an important role in disease recurrence."

Ovarian cancer is the most lethal gynecologic cancer, with more than 22,400 diagnoses and over 14,000 deaths projected in 2018.1 This is due primarily to the lack of reliable early detection methods, resulting in greater than 75% of patients presenting with advanced stage disease. Unfortunately, despite aggressive surgery and adjuvant platinum-based chemotherapy with taxane, which is the standard of care2, most women with ovarian cancer develop recurrent disease that is ineffectively treated with current therapies.

"Recurrent ovarian cancer is thought to result in part from the inability to eliminate rare chemoresistant CSCs that survive cytotoxic chemotherapy and drive tumor resurgence," said Dr. Rueda. "The ability to identify markers of chemoresistant cells is central to developing new therapeutic strategies that target

these cells and ultimately provide clinical impact by reducing disease recurrence. Data from this study suggest a potential role for highly specific, glycan-targeted therapy in ovarian cancer treatment."

Siamab’s proprietary technology platform enables the development of highly specific monoclonal antibody (mAb) therapeutics, including ADCs, targeting cancer cell surface glycans called TACAs. TACAs are an emerging set of tumor-specific antigens implicated in immune suppression, chemoresistance and a CSC phenotype. The presence of STn on tumors is associated with metastatic disease, poor prognosis, and reduced overall survival.

The paper entitled, "Treatment of ovarian cancer by targeting the tumor stem cell-associated carbohydrate antigen, Sialyl-Thomsen-nouveau," can be found online on the Oncotarget website.

On May 1, 2018 Vaxart, Inc., a clinical-stage biotechnology company developing oral recombinant vaccines that are administered by tablet rather than by injection, reported the appointment of David Taylor, M.D., as Chief Medical Officer. Dr. Taylor brings over 35 years of extensive experience in medical research, drug and vaccine development and clinical trial management for government organizations, non-profits, academia and both private and public healthcare companies (Press release, Vaxart, MAY 1, 2018, View Source [SID1234525899]).

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"Strengthening our leadership team with the appointment of David is an important milestone for Vaxart as we continue to advance our oral vaccine platform. Dr. Taylor is a drug discovery and development veteran with deep industry knowledge developing recombinant and enteric vaccines, with expertise in the design, execution and analysis of norovirus and influenza vaccine clinical trials," said Wouter Latour, chief executive officer of Vaxart. "We are pleased to welcome David and are confident his guidance will prove invaluable as we move our vaccine programs further in the clinic."

Prior to joining Vaxart, Dr. Taylor served as a senior medical officer of the drug and vaccine development global programs at PATH, where he developed clinical trial designs and executed studies for seasonal and universal flu vaccines and enteric vaccines. Earlier, he was senior medical director of vaccines at Takeda Vaccines, developing clinical trial plans for norovirus and dengue vaccines. Previously, Dr. Taylor served as chief medical officer at VaxInnate Corporation, where he focused on the development of recombinant vaccines for influenza and other infectious diseases, and chief medical officer and vice president of medical and safety at Salix Pharmaceuticals, where he developed Rifaximin (Xifaxan) for the treatment of traveller’s diarrhea and headed medical affairs and pharmacovigilance.

Before Salix, he was a research professor for the Department of International Health at Johns Hopkins Bloomberg School of Public Health. Dr. Taylor began his career as an epidemic intelligence service officer in the Enteric Disease Branch at the Centers for Disease Control and Prevention (CDC) and served 22 years in various capacities at research institutes in the United States Army including founder and chief of the Department of Clinical Trials and acting director for the Division of Communicable Diseases and Immunology at the Walter Reed Army Institute of Research.

Dr. Taylor earned his MSc. in Medical Parasitology from the London School of Hygiene and Tropical Medicine, M.D. from Harvard Medical School, D.M.S. from Dartmouth Medical School and B.S. in Biology from Kenyon College.

About Vaxart

On May 1, 2018 Obsidian Therapeutics, Inc., a biotechnology company dedicated to the development of next-generation cell and gene therapies with pharmacologic operating systems, reported that two abstracts highlighting preclinical data on the use of its technology for regulation of immunocytokines have been selected for presentation at the 21st Annual Meeting of the American Society of Gene and Cell Therapy (ASGCT) (Free ASGCT Whitepaper), taking place May 16-19, 2018, in Chicago, IL (Press release, Obsidian Therapeutics, MAY 1, 2018, View Source [SID1234525898]).

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Details of the poster presentations, both taking place on Wednesday, May 16, 2018, are as follows:

Poster Title: Exogenous In Vitro and In Vivo Regulation of Interleukin-12 Secretion from T Cells Using Destabilizing Domain Technology
Presenter: Dexue Sun
Session Date/Time: Wednesday May 16, 2018, at 5:30 – 7:30 p.m. CT
Session title: Cancer – Immunotherapy, Cancer Vaccines I
Room: Stevens Salon C, D
Abstract number: 113

Poster Title: Dose dependent exogenous regulation of membrane bound Interleukin-15-Interleukin-15 receptor alpha fusion protein for adoptive T-cell therapy
Presenter: Christopher Reardon
Session Date/Time: Wednesday May 16, 2018, at 5:30 – 7:30 p.m. CT
Session title: Cancer – Targeted Gene & Cell Therapy I
Room: Stevens Salon C, D
Abstract number: 133

About Destabilizing Domains

Obsidian uses Destabilizing Domains (DDs) to enable pharmacologic regulation of protein activity for next-generation cell and gene therapies. Obsidian’s DDs are small, fully-human protein domains that confer conditional stability to a fused payload protein. In the absence of a specific small molecule ligand the fusion protein is rapidly degraded, whereas in the presence of the ligand, the fusion protein becomes stable and functional. Obsidian uses this approach to equip engineered cells with controllable functions that can be precisely tuned by the administration of non-immunosuppressive, small molecule medicines that are readily available and dispensed by the treating physician.