On February 26, 2019 Compugen Ltd. (NASDAQ: CGEN), a leader in predictive discovery and development of first-in-class therapeutics for cancer immunotherapy, reported financial results for the fourth quarter and full year ended December 31, 2018 (Press release, Compugen, FEB 26, 2019, View Source [SID1234533677]).

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Compugen also announced a corporate restructuring to reduce costs by consolidating and streamlining R&D operations. Anticipated cost reductions are expected to extend the Company’s cash runway through mid-2020 to enable the planned expansion of the ongoing Phase 1 study for COM701, a first-in-class immunotherapy antibody targeting the PVRIG checkpoint, which continues to progress as planned. In addition, the Company will maintain investment in its proprietary computational discovery platform and will continue to advance its earlier stage immuno-oncology pipeline programs, which are the Company’s two long-term core value drivers.

"2018 was a pivotal year for Compugen in which two clinical trials were initiated for our computationally-discovered immuno-oncology programs, COM701 and BAY 1905254, and we partnered with Bristol-Myers Squibb and AstraZeneca," said Anat Cohen-Dayag, Ph.D., President and CEO of Compugen. "After reaching these important inflection points in our corporate development, the management team and Board undertook a strategic review of the Company’s operations and cost structure to ensure effective use of capital in support of the Company’s long-term objectives.

"This restructuring will allow us to focus the necessary resources to execute the COM701 study, including the initiation of combination studies with Opdivo. Of equal importance is the decision to consolidate and streamline our R&D infrastructure and continue investing in our two long-term core value drivers. These difficult decisions are necessary to effectively use our capital to ensure our future growth and the achievement of our strategic objectives. We will implement these organizational changes with the utmost respect for our employees, who I thank for their dedication and significant contributions made to our organization."

Corporate Restructuring
The restructuring includes:

Consolidation of R&D activities in one location (Israel). Positions and operations eliminated will also reduce overlapping R&D and G&A activities in Israel and the United States;

A 35% workforce reduction (approximately 35 employees), the majority of which is in R&D;

Certain preclinical activities will be outsourced to third-party service providers;

IND filing for COM902 in 2019 will proceed as planned. Initiation of the Phase 1 trial for this program will be dependent on the drug combination trials pursued under the collaboration with Bristol-Myers Squibb as well as available resources to support this trial;

Clinical development and business development activities will continue to operate in the United States; and

Compugen anticipates savings of up to $10 million on an annual basis. Cash expenditures for 2019 including one-time restructuring related costs, are expected to be in the range of $27 to $29 million, with the full effect of the savings reflected in 2020.

Recent Corporate Highlights

Published two peer-reviewed papers in Cancer Immunology Research demonstrating the role of PVRIG as a novel immune checkpoint target for cancer immunotherapy;

Awarded U.S. patent No. 10,124,061 from the U.S. Patent and Trademark Office for the method of using COM902, an anti-TIGIT monoclonal antibody, for activating T cells in cancer patients under the Cancer Moonshot program;

Signed a clinical trial collaboration with Bristol-Myers Squibb for a Phase 1 combination study of COM701 and Opdivo;

Received a $12 million investment from Bristol-Myers Squibb as part of the collaboration;

Initiated the COM701 monotherapy dose escalation Phase 1 clinical trial in advanced solid tumor patients; and

Bayer initiated a Phase 1 study for BAY 1905254, its first-in-class therapeutic antibody program targeting ILDR2, computationally-discovered by Compugen.

Financial Results
Revenues for the year ended December 31, 2018 were $17.8 million, compared with $0 in the comparable period of 2017. The revenues for 2018 reflect the upfront payment of $10 million from the license agreement with AstraZeneca and the $7.8 million milestone payment from Bayer AG in connection with the dosing of the first patient in the Phase 1 study of BAY 1905254.

R&D expenses for the fourth quarter and year ended December 31, 2018 were $7.5 million and $30.3 million, respectively, compared with $7.2 million and $28.6 million for the comparable periods in 2017. The increase reflects the expenses associated with the ongoing Phase 1 study of COM701.

Net loss for the fourth quarter of 2018 was $9.4 million, or $0.16 per diluted share, compared with a net loss of $9.3 million, or $0.18 per diluted share, in the comparable period of 2017. Net loss for the year ended December 31, 2018 was $22.6 million, or $0.41 per diluted share, compared with a net loss of $37.1 million, or $0.72 per diluted share, for the year ended December 31, 2017.

As of December 31, 2018, cash, cash related accounts, short-term and long-term bank deposits totaled $45.7 million, compared with $30.4 million at December 31, 2017. The Company has no debt.

Based on current cash and anticipated savings resulting from restructuring activities, the Company expects its cash runway to extend through mid-2020, not including potential cash inflow from existing or new business development arrangements.

Conference Call and Webcast Information
Compugen will hold a conference call to discuss its fourth quarter and full year 2018 results today, February 26, 2019, at 8:30 a.m. ET. To access the live conference call by telephone, please dial 1-888-407-2553 from the U.S., or +972-3-918-0610 internationally. The conference call will also be available via live webcast through Compugen’s website, located at the following link. Following the live audio webcast, a replay will be available on the Company’s website.

On February 26, 2019 Cell Medica reported that it has been awarded an $8.7 million research grant from the Cancer Prevention and Research Institute of Texas (CPRIT) (Press release, Cell Medica, FEB 26, 2019, View Source [SID1234533676]). The grant will support preclinical and clinical development of the company’s off-the-shelf chimeric antigen receptor-natural killer T cell (CAR-NKT) therapies to treat hematological and solid tumors.

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The CPRIT grant will support development programs being conducted in collaboration with Baylor College of Medicine (BCM) that are designed to address the limitations of the current first-generation autologous CAR-T cell therapies. The aim is to deliver an off-the-shelf approach, with simplified manufacturing, that can serve larger patient numbers, and which allows treatment closer to the time of patient presentation. The program currently includes four therapies in early-stage development.

CMD-502 is Cell Medica’s most advanced off-the-shelf therapy and a first-in-human study is expected to start in the second half of 2019. Called the ANCHOR study, it will be a dose escalation evaluation of CMD-502 in adults with relapsed or refractory (R/R) diffuse large B cell lymphoma (DLBCL), acute lymphoblastic leukemia (ALL), and chronic lymphocytic leukemia (CLL).

CPRIT awarded a $15.3 million grant to Cell Medica in 2012, to support the establishment of operations in Houston, Texas and fund earlier development programs. Through the current grant, CPRIT-funded research will be conducted at both BCM and Cell Medica’s Houston facility.

Chris Nowers, CEO of Cell Medica, commented: "CPRIT was instrumental in enabling us to establish our US operations in Texas, so we are delighted to extend that collaboration through a further grant. This funding will accelerate development of our off-the-shelf CAR-NKT pipeline and, given CPRIT’s deep and broad review, also brings a strong independent validation of our platform and approach."

Dr. Carlos Ramos, Associate Professor, Center for Cell and Gene Therapy, at BCM and principal investigator in Phase 1 ANCHOR study, added: "It has been a great pleasure working with the multi-disciplinary team at Cell Medica in the development of its versatile CAR-NKT platform. Off-the-shelf CAR-NKT cell therapy has the potential to become a better and simpler approach to CAR therapy for patients with hematological and solid tumors.

"Although existing autologous CAR-T cell therapies have demonstrated impressive response rates, the patient-specific manufacturing process is technically challenging, costly, and time-consuming, and comes with complex logistics and substantial treatment delays. The unique properties of NKT cells bring the potential to solve these challenges."

On February 26, 2019 Kleo Pharmaceuticals Inc., a unique immuno-oncology company developing next-generation bispecific compounds designed to emulate or enhance the activity of biologics, reported that its Chief Executive Officer Douglas J. Manion, M.D., FRCP(C), will present at the 16th Annual BIO Asia International Conference, to be held March 5-6, 2019, at the Grand Hyatt Tokyo in Tokyo, Japan (Press release, Kleo Pharmaceuticals, FEB 26, 2019, View Source [SID1234533675]).

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Dr. Manion will present an overview of Kleo’s development strategy for its pipeline of small molecule and synthetic peptide compounds that function similar to highly complex biologics, while offering multiple potential advantages. The overview will also outline Kleo’s key value drivers including the three proprietary technology platforms that drive in-house drug development and partnership opportunities, the multiple in-house and collaborative channels through which it is building its immuno-oncology pipeline, and its discovery collaboration with PeptiDream.

Kleo is well-funded to achieve multiple preclinical and early clinical milestones following the November 2018 closing of an oversubscribed $21 million Series B financing to advance its first clinical candidates through IND-enabling studies and into the clinic in 2020.

Details of Kleo’s presentation are as follows:

Event: 16th Annual BIO Asia International Conference

Date: Tuesday, March 6th, 2019

Time: 8:45 AM JST

Location: Grand Hyatt Tokyo, Drawing Room, 2nd floor

On February 26, 2019 TG Therapeutics, Inc. (NASDAQ: TGTX), a biopharmaceutical company dedicated to developing medicines for patients with B-cell mediated diseases, reported the commencement of a Phase I first-in-human trial of TG-1801, the Company’s novel first-in-class anti-CD47/CD19 bispecific antibody, in patients with relapsed or refractory B-cell lymphoma (Press release, TG Therapeutics, FEB 26, 2019, View Source [SID1234533673]).

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TG-1801 is the first therapy to target both CD19, a B-cell specific marker widely expressed across B-cell malignancies, and CD47, the "don’t eat me" signal used by both healthy and tumor cells to evade macrophage mediated phagocytosis. CD47 is expressed ubiquitously on normal cells, including red blood cells and platelets. By co-targeting both CD47 and CD19, TG-1801 has the potential to overcome the limitations of existing CD47 targeted therapies by avoiding the side effects caused by indiscriminate blockade of CD47 on healthy cells.

This Phase I open label, multi-center trial is designed to assess the safety, pharmacokinetics, efficacy and recommended Phase 2 dose of TG-1801. The primary objective of the study is to determine the Maximum Tolerated Dose (MTD) and characterize the safety profile of TG-1801, with secondary endpoints including characterization of pharmacokinetics and preliminary anti-cancer activity.

Michael S. Weiss, the Company’s Executive Chairman and Chief Executive Officer stated, "We are extremely pleased to announce the commencement of clinical development for TG-1801, our proprietary first-in-class anti-CD47/CD19 bispecific antibody which we licensed from Novimmune last year." Mr. Weiss continued, "CD47 targeted therapy has yielded promising early clinical results, and we look forward to exploring the potential of this dual targeted immunotherapy with a long-term goal of combining TG-1801 with our other in-house immunotherapies and targeted agents to create novel treatment options for patients with B-cell cancers."

On February 26, 2019 Vericel Corporation (NASDAQ:VCEL), a leader in advanced cell therapies for the sports medicine and severe burn care markets, reported financial results and business highlights for the fourth quarter and year ended December 31, 2018 and provided full-year 2019 financial guidance (Press release, Vericel, FEB 26, 2019, View Source [SID1234533670]).
Fourth Quarter 2018 Financial Highlights

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Total net product revenues increased 41% to $31.3 million compared to $22.2 million in the fourth quarter of 2017;

Gross margins of 72% compared to gross margins of 64% in the fourth quarter of 2017;

Net income of $5.2 million, or $0.11 per share, compared to $0.3 million, or $0.01 per share, in the fourth quarter of 2017;

Non-GAAP adjusted EBITDA of $7.7 million compared to $2.2 million in the fourth quarter of 2017; and

As of December 31, 2018, after retiring all outstanding debt, the company had $82.9 million in cash and short-term investments compared to $26.9 million in cash at December 31, 2017.

Full-Year 2018 Financial Highlights

Total net product revenues increased 45% to $90.9 million compared to $62.8 million in 2017;

Gross margins of 65% compared to gross margins of 53% in 2017;
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Net loss of $8.1 million, or $0.20 per share, compared to a net loss of $17.3 million, or $0.52 per share, in 2017; and

Non-GAAP adjusted EBITDA of $4.7 million compared to a loss of $9.4 million in 2017.

Recent Business Highlights
During and since the fourth quarter of 2018, the company:

Reported record fourth quarter revenues, marking the seventh consecutive quarter with record revenues for the reported quarter;

Reported full-year positive adjusted EBITDA;

Expanded the MACI sales force from 40 to 48 territories; and

Reported publication of outcomes data from 954 burn patients treated with Epicel in the Journal of Burn Care and Research.

"We delivered record fourth quarter and full-year revenues and gross margins, and reported full-year positive adjusted EBITDA for the first time in the company’s history," said Nick Colangelo, president and CEO of Vericel. "Based on MACI’s performance in 2018 and the feedback that we are receiving from surgeons and patients, it is clear that MACI is filling what has been a large unmet need in the cartilage repair market, and we expect continued strong revenue and profit growth in 2019."

2019 Financial Guidance
The company expects total net product revenues for 2019 to be in the range of $108 million to $112 million. The company also expects margins to continue to increase, with approximately 80% of marginal revenue over 2018 to contribute to gross profit and approximately 50% of marginal revenue over 2018 to contribute to adjusted EBITDA. Quarterly seasonality, which impacts both revenues and margins, is expected to follow the same pattern as 2018.

Fourth Quarter 2018 Results
Total net product revenues for the quarter ended December 31, 2018 increased 41% to $31.3 million compared to $22.2 million in the fourth quarter of 2017. Total net product revenues for the quarter included $25.1 million of MACI (autologous cultured chondrocytes on porcine collage membrane) net revenue and $6.2 million of Epicel (cultured epidermal autografts) net revenue, compared to $16.1 million of MACI net revenue and $6.1 million of Epicel net revenue, respectively, in the fourth quarter of 2017. Total revenues for the fourth quarter of 2017 also included $1.2 million in license revenue related to the company’s license agreement with Innovative Cellular Therapeutics (ICT).
Gross profit for the quarter ended December 31, 2018 was $22.7 million, or 72% of net revenues, compared to $15.0 million, or 64% of net revenues, for the fourth quarter of 2017.
Total operating expenses for the quarter ended December 31, 2018 were $16.7 million compared to $13.8 million for the same period in 2017. The increase in operating expenses was primarily due to $1.4 million in service fees paid to MACI pharmacy distributors, an incremental $1.2 million in employee-related expenses associated with the expanded MACI sales force, and an incremental $0.5 million in stock-based compensation expense.
Vericel’s net income for the quarter ended December 31, 2018 was $5.2 million, or $0.11 per share, compared to a $0.3 million, or $0.01 per share, for the fourth quarter of 2017.
Non-GAAP adjusted EBITDA was $7.7 million for the quarter ended December 31, 2018 compared to $2.2 million in the fourth quarter of 2017. See table reconciling non-GAAP measures for more details.

As of December 31, 2018, the company had $82.9 million in cash and short-term investments compared to $26.9 million in cash at December 31, 2017.
Full-Year 2018 Results
Total net product revenues for the year ended December 31, 2018 increased 45% to $90.9 million compared to $62.8 million in 2017. Total net product revenues for the year included $67.7 million of MACI net revenue and $23.1 million of Epicel net revenue, compared to $43.9 million of MACI and Carticel (autologous cultured chondrocytes) net revenue and $18.9 million of Epicel net revenue, respectively, in 2017. Total revenues in 2017 also included $1.2 million in license revenue related to the company’s license agreement with ICT.
Gross profit for the year ended December 31, 2018 was $58.7 million, or 65% of net revenues, compared to $33.6 million, or 53% of net revenues, for 2017.
Total operating expenses for the year ended December 31, 2018 were $62.6 million compared to $48.6 million in 2017. The increase in operating expenses was primarily due to an incremental $4.5 million in employee-related expenses associated with the expanded MACI sales force, an incremental $2.7 million in stock-based compensation expense and an increase of $2.6 million in service fees paid to MACI pharmacy distributors.
Vericel’s net loss for the year ended December 31, 2018 was $8.1 million, or $0.20 per share, compared to a loss of $17.3 million, or $0.52 per share, in 2017.
Non-GAAP adjusted EBITDA was $4.7 million for the year ended December 31, 2018 compared to a loss of $9.4 million in 2017. See table reconciling non-GAAP measures for more details.
Conference Call Information
Today’s conference call will be available live at 8:30am Eastern time in the Investor Relations section of the Vericel website at View Source." target="_blank" title="View Source." rel="nofollow">View Source Please access the site at least 15 minutes prior to the scheduled start time in order to download the required audio software if necessary. To participate in the live call by telephone, please call (877) 312-5881 and reference Vericel Corporation’s fourth-quarter 2018 investor conference call. If calling from outside the U.S., please use the international phone number (253) 237-1173.
If you are unable to participate in the live call, the webcast will be available at View Source until February 26, 2020. A replay of the call will also be available until 11:15am (EDT) on March 3, 2019 by calling (855) 859-2056, or from outside the U.S. (404) 537-3406. The conference ID is 3485006.