On January 23, 2019 Varian (NYSE: VAR) reported its first quarter fiscal year 2019 results (Filing, 8-K, Varian Medical Systems, JAN 23, 2019, View Source [SID1234532877]). All comparisons in this announcement are year-over-year, all quarter and year references are fiscal unless noted otherwise, and any references to orders are gross orders.

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(1)Non-GAAP net earnings and Non-GAAP net earnings per diluted share are defined as GAAP net earnings and GAAP net earnings per diluted share adjusted to exclude the amortization of intangible assets, acquisition-related expenses and benefits, significant litigation charges or benefits and legal costs, significant non-recurring tax expense or benefit, and gains or losses on equity investments.

"In the first quarter, we built on the strong trajectory from last year, bringing our trailing twelve-month orders growth rate to 11%," said Dow Wilson, chief executive officer of Varian. "The team delivered exceptional performance, with accelerating software revenues and overall orders growing double-digits in each of our three geographic regions. We made progress on our strategic growth initiatives, extending our global footprint by securing Halcyon approval in China and expanding our addressable markets by signing two Noona deals with pharmaceutical companies. With a strong start to the year and tariff mitigation activities on track, we are well-positioned to deliver results within our fiscal year 2019 guidance."

The company ended the quarter with $616 million in cash and cash equivalents and no debt. Net cash provided by operating activities was $141 million, down 21% due to timing of certain accounts receivable collections and inventory build to meet demand. During the quarter, the company invested $35 million to repurchase 320,000 shares of common stock.

Oncology Systems Segment

In the first quarter, Oncology revenues totaled $702 million, up 8%. Operating earnings for the segment decreased 10%, primarily driven by the impact of tariffs.

Orders were $716 million, up 16%. Orders in the Americas increased 12%. In EMEA, orders rose 15%, the sixth consecutive quarter of double-digit growth for the region. In APAC, orders increased 25%, with accelerating growth in China.

Proton Solutions Segment

In the first quarter, Proton Solutions revenues totaled $39 million, up 32%. The company completed clinical handovers for one room each at three sites.

Non-GAAP Adjustments

Varian’s GAAP operating earnings include $22 million from the gain on the sale of the company’s equity investment in Augmenix, Inc. The company also incurred $2 million in acquisition-related expenses.

Guidance for Full Fiscal Year 2019

We are reaffirming the following guidance for fiscal year 2019:

•Revenue range of $3.06 billion to $3.15 billion, representing growth of 5% to 8%
•Non-GAAP operating earnings as a percentage of revenues range of 17.0% to 18.0%
•Non-GAAP net earnings per diluted share range of $4.60 to $4.75
•Cash flows from operations range of $460 million to $510 million

The guidance assumes a Non-GAAP effective tax rate of 21% to 22% and a weighted average diluted share count of 92 million. The guidance also assumes currency rates as of the beginning of fiscal year 2019, includes the expected net impact of all tariffs effective as of the beginning of the fiscal year, and excludes any future acquisitions.

Please refer to "Discussion of Non-GAAP Financial Measures" below for a description of items excluded from expected non-GAAP earnings.

Investor Conference Call

Varian Medical Systems is scheduled to conduct its first quarter fiscal year 2019 conference call at 1:30 p.m. Pacific Time today. To access the live webcast or replay of the call, visit the Investor Relations page on our website at www.varian.com/investors. To access the call via telephone, dial 1-877-869-3847 from inside the U.S. or 1-201-689-8261 from outside the U.S. The replay can be accessed by dialing 1-877-660-6853 from inside the U.S. or 1-201-612-7415 from outside the U.S. and entering conference ID 13685671. The teleconference replay will be available through 5:00 p.m. Pacific Time, Friday, January 25, 2019.

On January 23, 2019 PTC Therapeutics, Inc. (Nasdaq: PTCT) reported the pricing of a public offering of 6,720,000 shares of its common stock at a public offering price of $30.20 per share, before underwriting discounts (Press release, PTC Therapeutics, JAN 23, 2019, View Source [SID1234532837]). All of the shares in the offering are to be sold by PTC. In addition, PTC has granted the underwriter an option for a period of 30 days to purchase up to an additional 1,008,000 shares of common stock at the public offering price, less the underwriting discount.

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RBC Capital Markets is acting as the sole book-running manager for the offering.

PTC expects to close the offering on or about January 25, 2019, subject to satisfaction of customary closing conditions.

An automatically effective shelf registration statement on Form S-3 relating to the shares of common stock offered in the public offering has been filed with the Securities and Exchange Commission (the "SEC") and is available on the SEC’s website at www.sec.gov. A final prospectus supplement relating to and describing the terms of the offering also will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. Before investing in the offering, interested parties should read the prospectus supplement and the accompanying prospectus for the offering and the other documents PTC has filed with the SEC that are incorporated by reference in the prospectus supplement and the accompanying prospectus, which provide more complete information about PTC and the offering. Copies of the prospectus supplement and the accompanying prospectus relating to the offering may be obtained from: RBC Capital Markets, LLC, Attention: Equity Syndicate, 200 Vesey Street, 8th Floor, New York, NY 10281; telephone: (877) 822-4089; email: [email protected].

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, these securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to the registration or qualification under the securities laws of such state or jurisdiction.

On January 23, 2019 Philogen S.p.A. (a privately-owned company) reported that they have entered into a collaboration and license agreement with Celgene, to discover and develop a new class of immunomodulatory therapeutics (Press release, Philogen, JAN 23, 2019, View Source [SID1234532836]).

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"We are extremely pleased to establish a new collaboration with Celgene, a leader in the discovery and development and commercialization of innovative therapies for patients with high unmet medical needs," commented Dr. Duccio Neri, Philogen’s CEO.

On January 23, 2019 Advaxis, Inc. (NASDAQ:ADXS), a late-stage biotechnology company focused on the discovery, development and commercialization of immunotherapy products, reported receipt of notification from the U.S. Food and Drug Administration (FDA) that the Company’s ongoing Phase 3, randomized, double-blinded, placebo-controlled, pivotal study of axalimogene filolisbac (AXAL) in high-risk, locally advanced cervical cancer (AIM2CERV) has been placed on partial clinical hold (Press release, Advaxis, JAN 23, 2019, View Source [SID1234532835]). The FDA’s recent communication, received late last week, states that the partial hold is related to their requests for additional information pertaining to certain AXAL chemistry, manufacturing and controls (CMC) matters. The Agency did not cite any safety issues related to the trial and all currently enrolled patients will continue to receive treatment, per the trial protocol. However, no new patients can enroll in AIM2CERV until resolution of this partial hold.

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"FDA’s review of the AXAL Investigational New Drug (IND) application was prompted by our proposal to modify the AIM2CERV trial’s analysis plan to include, among other things, allowance for a second formal interim analysis for both safety and efficacy," said Kenneth A. Berlin, President and Chief Executive Officer of Advaxis. "The primary focus of the items raised by the Agency relates to providing additional clarifying details for CMC information previously provided in support of Phase 3 development and which will help support a future Biologics License Application. We have already begun efforts to address the Agency’s requests for information and are working to respond as promptly as we can." He concluded, "Our AXAL product has demonstrated a manageable safety profile in the over 400 patients we have dosed to date and we look forward to enrolling new patients in our AIM2CERV trial after FDA agrees that the information we submit is responsive to its requests."

On January 23, 2019 Vedanta Biosciences, a clinical-stage company developing a new category of therapies for immune-mediated diseases based on rationally-defined consortia of human microbiome-derived bacteria, reported a publication in Nature that revealed a newly discovered mechanism underlying antitumor immunity that involves human microbiota-driven induction of interferon-gamma-producing (IFNy+) CD8+ T cell accumulation in the gut and tumors (Press release, Vedanta Biosciences, JAN 23, 2019, View Source [SID1234532834]). Led by Vedanta’s scientific co-founder Kenya Honda, M.D., Ph.D., of Keio University School of Medicine, the research also led to the identification and selection of a defined consortium of human microbiome-derived bacterial strains that harnesses this mechanism of antitumor activity and cooperatively potentiates responses to checkpoint inhibitor therapies and immune challenges in general. Based on this research, Vedanta is advancing VE800, a proprietary clinical candidate designed to enhance immune responses against cancer. Vedanta plans to initiate clinical studies in 2019 to evaluate VE800 in combination with Bristol-Myers Squibb’s checkpoint inhibitor OPDIVO (nivolumab).

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"This research demonstrates that specific, human microbiome-derived bacteria assembled rationally into consortia can cooperatively enhance the responses to immune checkpoint inhibitors, which supports our hypothesis that modulating the gut microbiota could be a powerful tool for potentiating immune responses that help fight cancer and infection," said Bernat Olle, Ph.D., Chief Executive Officer of Vedanta Biosciences. "This work also builds upon Dr. Honda’s previous groundbreaking research on the role of the human microbiome in modulating a range of immune responses and provides a robust scientific foundation for our proprietary lead cancer candidate, VE800."

The authors of the Nature paper sought to understand the previously poorly-characterized relationship between the human microbiota and intestinal IFNy+ CD8 T cells, which are critical to innate and adaptive immune responses. In preclinical models, they were able to establish that the number and frequency of these immune cells in the gut depend on the presence of a gut microbiota and are plastic, with specific members of the microbiota promoting their intestinal accumulation in an inducible and reversible manner. The authors went on to identify specific commensal bacterial strains from healthy human donors that spurred the production of IFNy+ CD8+ T cells.

Through rigorous selection, the authors isolated a defined consortium of commensal bacteria derived from the human microbiome that proved most effective at inducing rapid and persistent accumulation of IFNy+ CD8+ T cells. Mice colonized with the defined bacterial consortium demonstrated enhanced therapeutic efficacy in a range of tumor models when given in conjunction with PD-1 or CTLA4 immune checkpoint inhibitors. The strains identified are primarily rare, low-abundance components of the human microbiome, representing a significant opportunity for amplification as a therapeutic strategy.

The research demonstrates for the first time that human microbiome-derived bacterial consortia that cooperatively enhance the responses of immune checkpoint inhibitors can be identified. The authors addressed the challenge of reducing a complex community of human microbiome bacteria down to a few, rationally-defined members that can induce a robust immune potentiation response necessary for an effective cancer immune therapy, and directly linking their activity to pathways that promote antitumor immunity.

The Nature paper also found that human stool samples showed considerable variability in their ability to induce colonic IFNy+ CD8+ T cells. Vedanta’s development process is designed to bypass this variability by using pure, clonal cell banks of well-characterized bacterial strains isolated from healthy humans to produce defined consortia of uniform composition. This eliminates the need to rely on direct sourcing of fecal donor material of inconsistent composition. Vedanta sources bacteria from a vast, extensively characterized collection of 80,000 bacterial isolates obtained from human donors from four continents, which is believed to be the largest collection of human-gut associated bacteria. It then designs high-throughput assays to screen product candidates against a given disease target.

About VE800

VE800 is Vedanta Biosciences’ proprietary oral immuno-oncology product candidate. It consists of a rationally-defined bacterial consortium that activates cytotoxic CD8+ T cells, a type of white blood cell that is the predominant effector in cancer immunotherapy. In preclinical studies, VE800 has been shown to enhance the ability of these T cells to infiltrate tumors, thereby promoting suppression of tumor growth and enhancing survival. Data also suggest that VE800 may enhance the effects of checkpoint inhibitors. Vedanta is evaluating VE800 alone and in combination with checkpoint inhibitors as a potential treatment for patients with advanced or metastatic cancers. In December 2018, Vedanta entered into a clinical trial collaboration to evaluate Bristol-Myers Squibb’s programmed death-1 (PD-1) immune checkpoint inhibitor OPDIVO (nivolumab) in combination with Vedanta’s VE800, in patients with advanced or metastatic cancers. Clinical trials are expected to begin in 2019.