On August 9, 2018 Biocept, Inc. (NASDAQ: BIOC), a molecular diagnostics company commercializing and developing proprietary liquid biopsy tests that provide clinically actionable information to physicians to improve cancer treatment, reported that it will release financial results for the three and six months ended June 30, 2018, after the market closes on Tuesday, August 14, 2018 (Press release, Biocept, AUG 9, 2018, View Source [SID1234528588]). The Company will host a conference call for the investment community to discuss the results and answer questions at 4:30 p.m. Eastern time (1:30 p.m. Pacific time).

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Individuals interested in participating on the conference call may do so by dialing (855) 656-0927 for domestic callers, (855) 669-9657 for Canadian callers, or (412) 902-4109 for other international callers. Those interested in listening to a webcast of the live conference call may do so by visiting View Source

A replay of the conference call will be available for 48 hours following the conclusion of the call by dialing (877) 344-7529 for domestic callers, (855) 669-9658 for Canadian callers, or (412) 317-0088 for other international callers, and entering the replay access code 10122826. A webcast replay will be available for 90 days at http://ir.biocept.com/events.cfm.

On August 9, 2018 SCYNEXIS, Inc. (NASDAQ: SCYX), a biotechnology company delivering innovative therapies for difficult-to-treat and often life-threatening infections, reported financial results for the quarter ended June 30, 2018, and provided an update on recent operational and clinical developments (Press release, Scynexis, AUG 9, 2018, View Source [SID1234528587]).

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"With the positive results from our Phase 2b DOVE study in vulvovaginal candidiasis (VVC), we achieved a meaningful milestone in our efforts to make ibrexafungerp available to patients in need and to bring to market the first new antifungal class in nearly 20 years," said Marco Taglietti, M.D., President and Chief Executive Officer of SCYNEXIS. "While we continue to face challenges with the development of our IV formulation, we are pleased with the advancement and further de-risking of oral ibrexafungerp, which has the potential to address unmet medical needs in a variety of severe infections and improve the lives of patients."

Ibrexafungerp (formerly SCY-078) Update

600mg Oral Dose of Ibrexafungerp Identified for Phase 3 VVC Development; Phase 3 On Track for Initiation in the Fourth Quarter of 2018, with Potential NDA Filing in 2020.
In July 2018, SCYNEXIS reported positive top-line data from the Phase 2b DOVE study evaluating several dose regimens of oral ibrexafungerp for the treatment of VVC, compared to fluconazole (FLU), the standard of care for VVC. The 600mg dose of ibrexafungerp was well-tolerated, with strong overall clinical and mycological activity and improved sustained effect compared to FLU.
Pending the End-of-Phase 2 meeting with the U.S. Food and Drug Administration (FDA), we believe the 600mg dose of ibrexafungerp for one day (given as two doses of 300mg 12 hours apart) is the optimal dose regimen. We intend to use this dose in the VVC Phase 3 registration program, on track for initiation in the fourth quarter of 2018, and, pending successful completion of this trial, we anticipate filing an initial NDA for the treatment of VVC in 2020. Ibrexafungerp may represent the first new oral treatment for this indication in 25 years, and we believe it may provide significant benefits for the large number of patients not well-served by existing therapies.
Development Delay with IV Formulation of Ibrexafungerp. In January 2018, we announced encouraging pre-clinical results for the prototype liposomal IV formulation of ibrexafungerp, showing improved local tolerability profile at the infusion site in head-to-head pre-clinical evaluations with the cyclodextrin-based IV formulation. As part of our development plans, the process for the liposomal formulation was transferred for scale-up purposes at a manufacturing site intended to provide clinical supplies. Additional preclinical evaluations were performed with the scaled-up formulation, which unexpectedly revealed differences in tolerability at the injection site, delaying advancement of the IV product into human trials. As it is generally recognized that changes to manufacturing processes and/or scale-up can impact the characteristics of drug products, particularly for more technically complex formulations such as liposomal products, we are currently working with our vendors and CMC experts to enable us to resume the pre-IND pre-clinical activities for the IV formulation of ibrexafungerp.
Continued Progress on Company’s Strategy to Expand the Use of Ibrexafungerp in Indications Where the Oral Formulation is a Viable Treatment Option to Address Significant Unmet Needs.
Initiation of Phase 2 Combination Study Testing Oral Ibrexafungerp in Invasive Aspergillosis on Track for this Quarter. Encouraged by the improved outcomes and survival rates seen in an animal model of pulmonary aspergillosis, we plan to start a study in patients with invasive aspergillosis (IA) in the third quarter of 2018. The study will assess the safety and efficacy of oral ibrexafungerp in combination with azole therapy, the standard of care for this indication.
Open-label FURI and CARES Studies Ongoing with Preliminary Data Review Planned for the Fourth Quarter of 2018. These studies are designed to enroll patients with a wide range of Candida spp. infections with limited or no treatment options and are designed for potential expedited regulatory approval via the Limited Population Pathway for Antibacterial and Antifungal Drugs (LPAD).
SCY-078 Granted "Ibrexafungerp" as Non-proprietary Name by WHO. In assigning ibrexafungerp as the generic name of SCY-078, the World Health Organization (WHO) incorporated a novel stem (-fungerp), recognizing ibrexafungerp as the first member of a new triterpenoid drug class. With the last new antifungal class approved in 2001, ibrexafungerp has the potential to impact the rapidly rising resistance rates observed in many fungal species to today’s standards of care.
Oral Ibrexafungerp Granted QIDP and Fast Track Designations for the Treatment of VVC and the Prevention of VVC Recurrence. The Qualified Infectious Disease Product (QIDP) designation allows for priority review and an additional five years of market exclusivity in the U.S. The FDA’s Fast Track Drug Development Program is designed to facilitate the development and expeditious review of drugs to treat serious conditions and fill unmet medical needs.
Presentations at Medical Meetings and Peer-reviewed Publications. SCYNEXIS presented ibrexafungerp data at medical meetings and published data in a peer-reviewed journal. The data demonstrate the potent antifungal activity of ibrexafungerp against a broad range of fungal species, including echinocandin-resistant strains, as well as highlight numerous unique attributes, including lack of teratogenicity, synergistic activity with azoles and low risk of interactions with agents metabolized by CYP enzymes. Collectively, the data support the investigation of ibrexafungerp across a spectrum of antifungal indications, including VVC, invasive candidiasis (IC), IA, resistant fungal infections and prophylaxis indications.
In July 2018, at the 20th Congress of the International Society for Human and Animal Mycology, SCYNEXIS presented pre-clinical data demonstrating that ibrexafungerp has fungicidal activity against C. auris.
In June 2018, at the Teratology Society 58th Annual Meeting, SCYNEXIS presented pre-clinical data demonstrating that ibrexafungerp shows no impact on fertility or early embryo/fetal activity, potentially clinically relevant for women who are pregnant or may become pregnant.
In June 2018, at the 20th International Symposium on Infections in the Immunocompromised Host, SCYNEXIS presented pre-clinical data demonstrating that ibrexafungerp has activity alone, as well as synergistic activity with azole agents, against Aspergillus spp.
In June 2018, at the American Society for Microbiology Microbe 2018, SCYNEXIS presented data demonstrating that ibrexafungerp has potent in vitro activity against echinocandin-resistant Candida, as well as exhibits synergistic activity with isavuconazole against Aspergillus spp.
In June 2018, in The Journal of Clinical Pharmacology, SCYNEXIS published Phase 1 data demonstrating that ibrexafungerp has a low risk of interactions with drugs metabolized by CYP enzymes, potentially clinically relevant for patients with Type 2 diabetes.
In April 2018, at the 28th European Congress of Clinical Microbiology and Infectious Diseases, SCYNEXIS presented data demonstrating the in vitro activity of ibrexafungerp against Aspergillus spp., as well as the in vivo activity of ibrexafungerp against Pneumocystis pneumonia, supporting potential use for prophylaxis indications.
Second Quarter 2018 Financial Results

Cash, cash equivalents and short-term investments totaled $55.2 million as of June 30, 2018, with net working capital of $43.4 million. SCYNEXIS expects its cash, cash equivalents and short-term investments at June 30, 2018 will be sufficient to fund operations into 2020.

Research and development, net expenses increased to $5.6 million in the second quarter of 2018, compared to $4.4 million in the second quarter of 2017. The increase of $1.2 million, or 26%, for the three months ended June 30, 2018, was primarily driven by an increase of $0.8 million in pre-clinical development expense and a $1.0 million increase in clinical development expense; offset by a decrease in regulatory expense of $0.2 million and a decrease of $0.4 million in consulting expense.

Selling, general and administrative expenses decreased to $2.1 million in the second quarter of 2018, compared to $2.4 million in the second quarter of 2017. The decrease of $0.2 million, or 10%, for the three months ended June 30, 2018, was primarily driven by a decrease in business development related expenses and legal fees incurred during the three months ended June 30, 2018.

Total other expense decreased to $3.1 million in the second quarter of 2018 due to a $2.9 million non-cash loss recorded on the fair value adjustment of the warrant liabilities.

Net loss for the second quarter of 2018 was $10.8 million, or $0.23 per share. This compares with a net loss for the second quarter of 2017 of $4.2 million, or $0.16 per share.

About Ibrexafungerp (formerly SCY-078)

Ibrexafungerp [pronounced eye-BREX-ah-FUN-jerp] is an investigational antifungal agent and the first representative of a novel class of structurally-distinct glucan synthase inhibitors, triterpenoids. This agent combines the well-established activity of glucan synthase inhibitors with the potential flexibility of having oral and IV formulations. Ibrexafungerp is currently in development for the treatment of fungal infections caused primarily by Candida (including C. auris) and Aspergillus species. It has demonstrated broad spectrum antifungal activity, in vitro and in vivo, against multidrug-resistant pathogens, including azole- and echinocandin-resistant strains. The FDA has granted QIDP and Fast Track designations for the formulations of ibrexafungerp for the indications of IC (including candidemia), IA and VVC, and has granted Orphan Drug Designation for the IC and IA indications.

On August 9, 2018 BioCardia, Inc. [OTC: BCDA], a leader in the development of comprehensive solutions for cardiovascular regenerative therapies, reported financial results and business highlights for the second quarter 2018 and filed its quarterly report on Form 10-Q for the three and six months ended June 30, 2018 with the Securities and Exchange Commission (Press release, Biocardia, AUG 9, 2018, View Source [SID1234528586]).

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Second Quarter 2018 Financial Results:

Revenues increased to $239,000 for the second quarter of 2018 compared to $112,000 for the second quarter of 2017.
Net loss was $3.2 million for the second quarter of 2018, compared to $2.9 million for the second quarter of 2017.
Research and development expenses increased to $2.0 million in the second quarter of 2018, compared to $1.3 million in the second quarter of 2017, primarily due to expenses associated with the pivotal CardiAMP Heart Failure Trial and development of the Company’s second cell therapy candidate, the CardiALLO Cell Therapy System.
Selling, general and administrative expenses decreased to $1.3 million in the second quarter of 2018, compared to $1.6 million in the second quarter of 2017, primarily due to lower stock compensation expense.
Net cash used in operations in the second quarter of 2018 was $2.8 million, as compared to $2.1 million in the second quarter of 2017.
2018 Corporate Highlights:

Enrollment in the pivotal CardiAMP Heart Failure Trial has expanded to 17 world class centers in the United States as detailed on ClinicalTrials.Gov.
Two abstracts have been accepted for presentation at the Transcatheter Cardiovascular Therapeutics (TCT) conference in San Diego, one of the world’s largest and most important educational meeting specializing in interventional cardiovascular medicine. Both presentations are scheduled for September 24, 2018:
"The CardiAMP Heart Failure Study: First Results from Unblinded Roll-In Phase", to be presented at 9:06 am PDT.
"Performance of Helix Transendocardial Biotherapeutic Delivery System after 300 Cases", to be presented at 9:18 am PDT.
The U.S. Food and Drug Administration approved a second pivotal Investigational Device Exemption trial for the CardiAMP Cell Therapy System for the treatment of chronic myocardial ischemia with refractory angina, the "CardiAMP Chronic Myocardial Ischemia Trial". The Centers for Medicare and Medicaid Services (CMS) has approved this trial for national reimbursement coverage.
The Company received a new US patent related to its CardiAMP cell potency assay, providing further protection to its autologous cell therapy programs in both heart failure and chronic myocardial ischemia indications.
Anticipated Upcoming Milestones:

12-month data from the CardiAMP Heart Failure Trial 10-patient roll-in cohort in the fourth quarter 2018.
Filing of the Investigational New Drug (IND) for the CardiALLO Cell Therapy System, an investigational allogenic culture expanded "off the shelf" mesenchymal cell therapy for the treatment of ischemic heart failure, in the fourth quarter 2018.
Filing for FDA approval of an advanced bidirectional steerable guide system in the fourth quarter 2018.
Dosing of the first patient in the pivotal CardiAMP Chronic Myocardial Ischemia Trial in the first quarter 2019.
Completion of enrollment in the pivotal CardiAMP Heart Failure Trial in the third quarter 2019.

On August 9, 2018 Intrexon Corporation (NYSE: XON), a leader in the engineering and industrialization of biology to improve the quality of life and health of the planet,reported that it will host a call today to provide a general update and highlight recent business developments, as well as provide select preliminary and unaudited second quarter results (Press release, Intrexon, AUG 9, 2018, View Source [SID1234528585]).

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The Company is not announcing final financial results for the quarter ended June 30, 2018 and is delaying the filing of its quarterly report on Form 10-Q. The delay in filing the second quarter report is related to the Company’s application of certain aspects of ASC 606 in the Company’s first quarter Form 10-Q. The Company will be filing an amended Form 10-Q for the first quarter of 2018. The Company expects to file the second quarter report and amended first quarter report within the next few days.

Business Highlights:

Precigen, Inc., a wholly owned subsidiary of Intrexon and a pharmaceutical company specializing in the development of innovative gene and cellular therapies to improve the lives of patients, announced the treatment of the first patient in Phase 1 first-in-human clinical trials of its investigational therapy, INXN‑4001, the first multigene cardiac approach to express proteins encoded by three effector genes to treat heart failure;
Intrexon and Epimeron, Inc., a world-class provider of gene discovery and biosynthetic pathway optimization, announced the isolation and recombinant expression of a novel gene from the opium poppy (Papaver somniferum) encoding the enzyme thebaine synthase. The existence of this enzyme, which was not previously verified, is essential to increase the rate of the final step in thebaine synthesis, which the Company believes is a major breakthrough and allows biosynthesis of several important active agents and intermediates including thebaine, codeine and morphine;
Oxitec, Ltd., a wholly owned subsidiary of Intrexon, entered into a cooperative agreement with the Bill & Melinda Gates Foundation to develop a new strain of Oxitec’s self-limiting Friendly Mosquitoes to combat the Anopheles mosquito species that spreads malaria in the Western Hemisphere;
Collaborator Ziopharm Oncology, Inc. (Nasdaq: ZIOP) presented clinical data showing the company’s controlled IL-12 platform as monotherapy achieved anti-tumor responses in patients with metastatic breast cancer and recurrent glioblastoma at the 2018 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting;
Collaborator Ziopharm Oncology, Inc. (Nasdaq: ZIOP) announced that the first patient has been dosed in a new Phase 1 trial evaluating combination therapy of controlled IL-12 and OPDIVO (nivolumab) for the treatment of recurrent glioblastoma;
Collaborator Fibrocell Science, Inc. (Nasdaq: FCSC) reported interim results on the Phase 1/2 trial of FCX‑007 trial, a gene therapy for the treatment of recessive dystrophic epidermolysis bullosa. The results highlighted that FCX-007 was well tolerated at 52 weeks post-administration and showed continued positive trends in wound healing and pharmacological signals, including type VII collagen expression and evidence of anchoring fibrils; and
In July 2018, Intrexon completed its registered underwritten public offering of $200 million aggregate principal amount of 3.50% convertible senior notes due 2023. Concurrently with the notes offering, the Company entered into a share lending agreement with J.P. Morgan Securities LLC and JPMorgan Chase Bank, National Association, New York branch, as share borrower, pursuant to which the Company agreed to lend 7,479,431 shares of common stock of the Company, no par value per share to the share borrower. Randal J. Kirk, the Chairman, Chief Executive Officer and principal shareholder of the Company, and an entity with which he is affiliated, agreed with the share borrower to purchase all of the shares of Common Stock offered in the borrowed shares offering.
Recent Developments:

2,3, BDO yields are up 22% since last reported and continue to support the Company’s stated plan to break ground on a 40,000 ton/year plant by year end;
Intrexon scientists continue to engineer the methanotrophic organism to improve the utilization of natural gas as a carbon source;
Intrexon remains engaged in advanced discussions with multiple strategic partners for the methane bioconversion platform;
Xogenex, LLC, a majority owned subsidiary of Precigen, has dosed multiple patients in its Phase 1 trial of the gene therapy INXN-4001;
Helen Sabzevari, PhD, President of Precigen, will host an analyst day in Germantown, Maryland in the fourth quarter. At this meeting, Dr. Sabzevari will provide an in depth review and update of Precigen’s cell and gene based therapeutic programs; and
To date, Okanagan Specialty Fruits has completed the planting of over 900,000 Arctic apple trees on 592 total acres and is targeting planting 1,000,000 more trees in the spring of 2019.
Select Preliminary Unaudited Second Quarter 2018 Financial Results:

Revenues will be approximately $45.3 million;
Net loss attributable to Intrexon will be approximately $65.4 million (including noncash charges of $43.9 million); and
Earnings per share will be a loss of approximately $0.51 per basic share.
"The businesses of intrexon continue to advance, leaving their roots as historic achievements of numerous world first instances in the field of engineered biology to become strong economic engines that should produce revenues and profits for years to come," commented Randal J. Kirk, Chairman and Chief Executive Officer of Intrexon. "From the creation of the world’s first organisms that turn the cheapest source of carbon into valuable petrochemicals, fuels and lubricants, we are moving forward to capture the economic and social advantages of our achievements. From our demonstration of multigeneic and controllable gene and cell systems we are advancing into the clinic with therapies against many of the most important unmet health needs. From the development of the first engineered fish, insects, fruits and pigs, we are moving forward adroitly to see each of these become real businesses that contribute significant value to the world."

Mr. Kirk concluded, "I feel that we are on the cusp of showing with business what we have long demonstrated in the science and technology of engineered biology and believe that our shareholders will be pleased by the result."

Restatement of First Quarter Financial Results:

Effective January 1, 2018, the Company adopted ASC 606 using the modified retrospective method. The Company has reassessed its application of certain aspects of ASC 606, including gross versus net presentation for payments pursuant to one of the Company’s contracts and the guidance for contract modifications to a contract that had been modified prior to the adoption of ASC 606. The Company estimates that these errors have resulted in an overstatement of deferred revenue and accumulated deficit by approximately $67 million as of the adoption date, and an overstatement of revenues by approximately $4 million for the three months ended March 31, 2018. These estimates are based on the Company’s current expectations and are subject to finalization, including completion of quarterly procedures and completion of the Company’s technical accounting analysis for ASC 606.

Conference Call and Webcast

The Company will host a conference call today Thursday, August 9th, at 5:30 PM ET to provide a general business update. The conference call may be accessed by dialing 1‑888-317-6003 (Domestic US), 1-866-284-3684 (Canada), and 1-412-317-6061 (International) and providing the number 6027271 to join the Intrexon Corporation Call. Participants may also access the live webcast through Intrexon’s website in the Investors section at View Source

On August 9, 2018 Amneal Pharmaceuticals, Inc. (NYSE: AMRX) (the "Company") reported its results for the quarter ended June 30, 2018 (Press release, Amneal Pharmaceuticals, AUG 9, 2018, View Source [SID1234528584]).

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"We delivered solid sequential growth across our Generics and Specialty Pharma businesses on a combined adjusted basis compared to the first quarter of 2018 as we began to realize the benefits of our recent transformative combination with Impax," said Rob Stewart, President and CEO of Amneal.

"On a sequential basis, our Generics business delivered solid growth as we capitalized on the 16 product launches during the first six months of 2018, including generic versions of gConcerta, (methylphenidate HCI ER), Mephyton (phytonadione) and Welchol (colesevelam). We also benefited from higher sales of generic versions of Vagifem (yuvafem), Aggrenox (aspirin and extended-release dipyridamole) and Voltaren Gel 1% (diclofenac sodium gel), which more than offset the seasonal decline in sales of generic gTamiflu (oseltamivir phosphate).

In our Specialty Pharma business, we achieved sequential growth from sales of key products Rytary and Zomig nasal spray and across our anthelmintic product franchise.

We have made significant progress with the integration of Impax and continue to anticipate delivering at least $200 million in annual synergies within three years of the May 4th closing. Although we are revising our 2018 guidance to reflect the delayed timing of deliveries of our Epinephrine Auto-Injector product from our third-party manufacturer and the timing of certain key launches, we remain confident in the long-term growth potential for Amneal as we leverage our enhanced portfolio and focus on driving commercial and operational excellence initiatives to fuel organic growth, generate savings and strong cash flow, and deliver long-term returns for our shareholders."

Summary of GAAP and Combined Adjusted Results

1 Current year financials reflect the results of Amneal Pharmaceuticals LLC consolidating the results of Impax Laboratories, LLC from the transaction closing date on May 4, 2018. Prior year GAAP results represent Amneal Pharmaceuticals LLC only.

2 Assumes the combination between Amneal Pharmaceuticals LLC and Impax Laboratories, LLC occurred on the first day of the quarter presented.

"NM" is used when the variance is not meaningful because it is immaterial in absolute or percentage terms.

The Company’s financial results are presented in accordance with GAAP, which includes the results of Amneal Pharmaceuticals LLC consolidating the results of Impax Laboratories, LLC ("Impax") from the transaction closing date of May 4, 2018. Management believes that using additional non-GAAP measures on a combined company basis will facilitate the evaluation of the financial performance of the Company and its ongoing operations. The adjusted results presented combine the results of Amneal with Impax as if the closing date had occurred on the first day of all periods presented. All combined business results presented in this News Release are unaudited. Such combined business results are not prepared in accordance with Article 11 of Regulation S-X. Refer to the "Non-GAAP Financial Measures" section for additional information, including reconciliations of all GAAP to non-GAAP financial measures.

GAAP Basis Results

GAAP net revenue in the second quarter of 2018 was $413.8 million, an increase of 59.2%, compared to the second quarter of 2017, primarily due to the combination with Impax on May 4, 2018.
GAAP net loss in the second quarter of 2018 was $250.1 million, compared to net income of $37.7 million for the second quarter of 2017. The second quarter’s results were impacted by the May 4th combination with Impax and include charges relating to the vesting of profit participation units ("PPUs"), special employee bonuses and restructuring charges as a result of the combination.
GAAP diluted EPS in the second quarter of 2018 was a loss of $0.15, due to the PPU, bonus and restructuring charges noted above. GAAP diluted EPS for the second quarter of 2017 is not available as Amneal Pharmaceuticals LLC was a privately-held company for the period presented.
Non-GAAP Combined Results

Combined adjusted net revenue in the second quarter of 2018 was $462.3 million, a decrease of 2.5%, compared to the second quarter of 2017, primarily due to a 6.4% decline in combined net revenue for the Generics business, partially offset by a 24.1% increase in combined net revenue for the Specialty Pharma business revenue.
Combined adjusted net income in the second quarter of 2018 was $70.1 million, an increase of 12.3%, compared to the second quarter of 2017, primarily due to favorable product sales mix.
Earnings before interest, taxes, depreciation and amortization (EBITDA) was a loss of $204.0 million in the second quarter of 2018, compared to a gain of $89.0 million in the second quarter of 2017, primarily due to the PPU, bonus and restructuring charges noted above. Combined adjusted EBITDA in the second quarter of 2018 was $138.8 million, an increase of 16.8%, compared to the second quarter of 2017, primarily due to a more favorable product sales mix.
Combined adjusted diluted EPS in the second quarter of 2018 was $0.24.
Business Segment Information

The Company has two reportable segments, the Generics business and the Specialty Pharma business and does not allocate general corporate services to either segment.

Generics Business Information

The following Consolidated Statements of Operations table reconciles the Generics Business GAAP results to combined results. (Unaudited; In thousands)

Three months ended June 30, 2018

(a) Adjusted gross profit is calculated as total revenues less adjusted cost of goods sold. Adjusted gross margin is calculated as adjusted gross profit divided by total revenues. Refer to the "Non-GAAP Financial Measures" for a reconciliation of GAAP to non-GAAP items.

GAAP Results

Generics business revenues increased 39.2% for the second quarter of 2018, compared to the prior year period. The increase is primarily attributable to increased sales of Aspirin Dipyridamole ER due to higher volume, higher demand for Diclofenac Sodium Gel 1%, new launches including Methylphenidate ER Tabs and Phytonadione, and additional revenue from the combination with Impax.

Gross margin for the second quarter of 2018 was 41.5%, compared to 47.6% for the second quarter of 2017, primarily due to higher cost of sales due to purchase accounting adjustments as well as the fact that the Impax portfolio contains products with relatively lower profit margins.

Non-GAAP Combined Results

Generics business combined net revenue in the second quarter of 2018 was $382.8 million, a decrease of 6.8%, compared to $410.8 million in the prior year period. The decrease is primarily due to revenue reductions from lower sales of Epinephrine Auto-Injector due to an ongoing supply shortage at the Company’s third-party manufacturer, increased competition on Budesonide, Lidocaine, Yuvafem and Fenofibrate, and the impact of discontinued products. The decrease was partially offset by increased revenue from new product launches and increased sales of Aspirin Dipyridamole ER and Diclofenac Sodium Gel 1%.

Gross margin for the second quarter of 2018 on a combined basis was 37.0%, compared to 40.3% for the second quarter of 2017, primarily due to a charge for inventory step-up. Adjusted gross margin on a combined adjusted basis was 48.4% for the second quarter of 2018, compared to 50.0% in the prior year period.

Specialty Pharma Business Information

The following Consolidated Statements of Operations table reconciles the Specialty Pharma business GAAP results to combined results. (Unaudited; In thousands)

Three months ended June 30, 2018

(a) Adjusted gross profit is calculated as total revenues less adjusted cost of goods sold. Adjusted gross margin is calculated as adjusted gross profit divided by total revenues. Refer to the "Non-GAAP Financial Measures" for a reconciliation of GAAP to non-GAAP items.

GAAP Results

The Specialty Pharma business is comprised of the Impax Specialty business acquired on May 4, 2018 and the Gemini Laboratories, LLC business acquired on May 7, 2018. Prior to these two transactions, Amneal did not have a specialty business.

Non-GAAP Combined Results

Specialty Pharma business combined net revenue in the second quarter 2018 was $79.6 million, an increase of 25.5%, compared to $63.4 million in the prior year period, driven by higher revenue from Rytary, Zomig and the anthelmintic products franchise.

Gross margin for the second quarter of 2018 on a combined basis was 61.5%, compared to 60.2% for the second quarter of 2017. Adjusted gross margin on a combined adjusted basis was 79.2% for the second quarter of 2018, compared to 69.4% in the prior year period, primarily due to favorable product sales mix.

Corporate and Other Information

General and administrative expenses in the second quarter of 2018 were $22.8 million, an increase of $10.7 million, compared to the second quarter of 2018. The increase was primarily due to general and administrative expenses of the Impax organization since the closing of the combination, which includes certain public company costs that will remain on a go-forward basis. The increase is also attributable to stock-based compensation.

Non-GAAP Combined Results

General and administrative expenses in the second quarter of 2018 were $31.1 million, a decrease of 22.1%, compared to the second quarter of 2017, primarily due to cost synergies as a result of the business combination with Impax.

Other Information

Interest expense, net for the second quarter of 2018 was $36.6 million, compared to $17.7 million in the second quarter of 2018, due to an increase in long-term debt as a result of the business combination with Impax.

2018 Financial Guidance

Amneal’s full year 2018 estimates are based on management’s current expectations, including with respect to prescription trends, pricing levels, inventory levels, and the anticipated timing of future product launches and events. The Company does not provide forward-looking guidance metrics as outlined below on a GAAP basis. Consequently, the Company cannot provide a reconciliation between non-GAAP expectations and corresponding GAAP measures without unreasonable efforts because it is unable to predict with reasonable certainty the ultimate outcome of certain significant items required for the reconciliation. The items include, but are not limited to, acquisition-related expenses, restructuring expenses, asset impairments and certain and other gains and losses. These items are uncertain, depend on various factors, and could have a material impact on U.S. GAAP reported results for the guidance period. The following statements are forward looking and actual results could differ materially depending on market conditions and the factors set forth under "Safe Harbor" below.

2018 Key Guidance Assumptions

Revised full year 2018 adjusted EBITDA and adjusted EPS guidance primarily due to the delayed timing of deliveries of Epinephrine Auto-Injector
Generics business growth driven by new product launches which are expected to more than offset additional competition on existing portfolio
Launched 22 products through August 8, 2018. Potential opportunity to launch an additional 25 generic products the remainder of the year
Specialty Pharma business growth driven by Rytary, Zomig nasal spray and Emverm
Targeting synergies of $30 to $35 million
Approximately 50% R&D, 30% SG&A, 20% Manufacturing
Financial Guidance

Conference Call Information

Amneal will hold a conference call on August 9, 2018 at 8:30 a.m. Eastern Time to discuss its results. The call and presentation can also be accessed via a live Webcast through the Investor Relations section of Amneal’s Web site at View Source, or directly at View Source The number to call from within the United States is (877) 356-3814 and (706) 758-0033 internationally. The conference ID is 3045719. A replay of the conference call will be available shortly after the call for a period of seven days. To access the replay, dial (855) 859-2056 (in the U.S.) and (404) 537-3406 (international callers).