On November 7, 2019 Bavarian Nordic A/S (OMX: BAVA, OTC: BVNRY) reported its interim financial results in line with guidance for the first nine months of 2019 and business progress for the third quarter of 2019 (Press release, Bavarian Nordic, NOV 7, 2019, View Source [SID1234550647]).

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Paul Chaplin, President & Chief Executive Officer of Bavarian Nordic said: "We set out the year with a clear ambition and strategy to expand our commercial footprint, and with the recently announced acquisition of two commercial vaccines from GlaxoSmithKline (GSK), we turn to the next chapter for Bavarian Nordic to become an independent vaccine company with sustainable profitability. The company is fully focused on the integration of manufacturing of the two new vaccines and establishing the commercial operations to make this a great success. We will move ahead with our planned Phase 3 trial for RSV in 2021 that allows sufficient time to establish an improved commercial scale production and formulation to meet the demands of this blockbuster indication. The recent approval of JYNNEOS was also a tremendous milestone for the Company, offering exciting new business opportunities beyond our long-term partnership with the U.S. government to supply the national stockpile and offering clear synergies with the two acquired commercial vaccines."

TRANSFORMATIVE ACQUISITION OF TWO COMMERCIAL VACCINES FROM GLAXOSMITHKLINE
Announced on October 21, the acquisition of Rabipur/RabAvert and Encepur from GlaxoSmithKline (GSK) is a transformative transaction that will establish a leading infectious disease franchise and make Bavarian Nordic an independent and profitable vaccine company. Specifically, the transition:

Accelerates our vision by 3 years to become a leading and profitable vaccine company
Exploits significant manufacturing synergies between highly complementary technologies and builds on our expertise
Ensures strong cash flow generation, allowing us to continue progressing our promising innovative pipeline
Full details on the acquisition were published in company announcement no. 19/2019.

Closing of the acquisition is expected by December 31, 2019, conditional on antitrust approval as well as on approval of the rights issue by the Company’s shareholders. To resolve on the rights issue, an extraordinary general meeting has been convened on November 27, 2019. Details are available at www.bavarian-nordic.com/egm.

OPERATIONAL HIGHLIGHTS

Delivering our strategy
We set out for the year with a 5-year vision and four strategic imperatives that collectively build on our heritage in vaccine development and manufacturing, aiming to secure and reinforce a sustainable foundation, while also expanding the commercial opportunities. With the acquisition of two commercial vaccines from GSK, the recent approval of JYNNEOS and the advancement of several clinical programs during the year, we are on track to accomplish these targets:

MAINTAIN global leadership of our smallpox vaccine business
EXPAND and rapidly ADVANCE the pipeline of infectious disease programs
ESTABLISH a broad and deep cancer immunotherapy portfolio
EXPAND the commercial footprint and capabilities
Smallpox

In September, the U.S. Food and Drug Administration (FDA) approved JYNNEOS (MVA-BN) for protection against smallpox and monkeypox. The approval was the result of our successful, fifteen-year partnership with the U.S. government to develop a non-replicating smallpox vaccine, suitable for the entire population, presenting significant opportunities for our future business with the U.S. government beyond emergency stockpiling.
As expected, we were awarded a Priority Review Voucher along with the approval.
The additional indication for monkeypox provides new commercial opportunities to be exploited in the coming years as we expand the commercial infrastructure to accommodate sales and distribution of the vaccines acquired from GSK.
A Phase 3 lot-consistency trial, fully funded by BARDA, of the freeze-dried formulation of MVA-BN is ongoing. A prior Phase 2 study showed bioequivalence between the freeze-dried and liquid-frozen formulations of MVA-BN, and the lot-consistency trial was agreed with the FDA as the only Phase 3 study required to support licensure of the freeze-dried formulation, which is anticipated in 2022.
We are on track with the production of bulk vaccine for the current order for freeze-dried MVA-BN from the U.S. Government with the majority of the batches being invoiced in the fourth quarter of 2019 adding up to a total of USD 50 million included in our guided 2019 revenues.
Infectious diseases

The design of the Phase 3 efficacy trial, for our highly promising RSV vaccine candidate for the elderly (≥60 years old), has been finalized with the FDA. The randomized, placebo-controlled trial has an adaptive design and will enroll a total of 12,000 to 14,000 subjects over two seasons. The total number of subjects will depend on the independent analysis performed from the first 6,000 subjects enrolled for the first season. The estimated costs to determine futility after the season one will be USD 40 million and if positive, the second season will cost an additional USD 50-70 million, although after passing the first season threshold there would be approximately a 75% chance of successfully reaching the efficacy endpoint of the trial. The trial is planned to be initiated in 2021 prior to the RSV season, with the initial read out in 2022 and a potential approval in 2024.
In October, we initiated a Phase 1 clinical trial of MVA-BN WEV, a trivalent prophylactic vaccine against three strains of the equine encephalitis virus: Western, Eastern (also referred to as triple E) and Venezuelan. The current program is funded by the U.S. Department of Defense. Equine encephalitis virus is an alpha virus that is spread by mosquitos from infected birds to horses and people that can result in the rare condition of encephalitis in about 5% of the people that become infected. Since October, 31 cases, including 9 deaths have been reported by the US CDC in what is the largest ever recorded outbreak of triple E. Successful Phase 1 results could lead to additional funding of clinical development towards licensure of this important emerging infectious disease.
Our Janssen partnership provides an opportunity to explore and commercialize our MVA-BN platform in three infectious disease indications; HPV, HIV and HBV. A Phase 1/2a trial of the therapeutic HPV vaccine was initiated earlier this year and the first clinical trial of the therapeutic HIV vaccine is anticipated to begin in 2020. Collectively, these programs, along with our Ebola collaboration, represent USD 1 billion in potential future milestone payments, in addition to royalties on future sales.
Ebola continues to rage in the Democratic Republic of Congo, and Janssen recently announced the donation of up to 500,000 doses of the Ad26.ZEBOV/MVA-BN Filo vaccine regimen, which will be introduced to help counter the outbreak. Neighboring countries like Rwanda and Uganda have also expressed their intent to use the vaccine as Ebola cases have been reported around the border. In Uganda, a large trial of the vaccine was initiated in healthcare workers in August. The vaccine regimen has to-date been evaluated in more than 6,500 individuals in Phase 1, 2 and 3 clinical studies, and Janssen is planning to submit a Marketing Authorization Application to the European Medicines Agency this year.
Cancer immunotherapy

In October, we updated on the development of CV301, and the study in bladder cancer, which did not meet the efficacy threshold to expanded enrollment for the second stage. While we continue to follow and support two ongoing, investigator-sponsored Phase 2 trials evaluating CV301 in combination with checkpoint inhibitors in colorectal and pancreatic cancer, the Company’s focus moves to BN-Brachyury and the intravenous and intra-tumoral applications.
BN-Brachyury is currently being evaluated in a Phase 2 trial in patients with advanced chordoma. This trial, which also uses a two-stage design, indicated clinical activity in the first stage, allowing for expansion of enrollment, which was recently completed. Conclusive data from this study are expected within 12 months.
A planned Phase 1 dose escalation study at the National Cancer Institute (NCI) investigating the safety of MVA-BN Brachyury administered intravenously into patients with brachyury positive tumors will initiate shortly.
Commercial manufacturing

Construction of our fill and finish facility is progressing according to plan, and we expect the building to be completed by end of 2019, which is the peak investment year with approximately DKK 270 million in total investments.
The addition of a large-scale fill and finish line to our existing bulk production will significantly expand our manufacturing capabilities, allowing for integration of the products from GSK, while also enabling us to continuously support our partnerships, including fulfilling our smallpox vaccine contract with the U.S. government.
To support simultaneous manufacturing of multiple products, we will invest in a new, independent clean room suite at our existing facility to be initiated in 2020.
FINANCIALS AND OUTLOOK

Financial results for the first nine months in line with expectations

Revenue generated for the nine months ending September 30, 2019 was DKK 372 million/USD 54 million (DKK 319 million/USD 47 million in the first nine months of 2018).
The income before interest and tax (EBIT) was a loss of DKK 298 million/USD 43 million (loss of DKK 261 million/USD 38 million in the first nine months of 2018).
As of September 30, 2019, the Group’s cash preparedness was DKK 1,740 million/USD 254 million (DKK 2,314 million/USD 337 million as of December 31, 2018), including unutilized credit lines of DKK 244 million/USD 36 million (DKK 244 million/USD 36 million as of December 31, 2018).
Danish kroner (DKK) is the Company’s reporting currency. The USD figures provided above are based upon an assumed exchange rate of DKK 6.86 per 1.00 USD, which was the exchange rate as of September 30, 2019.

Outlook for 2019 maintained
The majority of our 2019 revenues are related to the production and release of bulk smallpox vaccine for the U.S. Government, most of which will occur in the fourth quarter of 2019. Hence, we maintain our financial expectations for 2019 as announced on March 21, 2019 with revenues of approximately DKK 600 million/USD 92 million for the full year and a loss before interest and tax (EBIT) of approximately DKK 360 million/USD 55 million. The expected cash preparedness at year-end was revised in October from approximately DKK 1,600 million/USD 246 million to approximately DKK 1,000 million/USD 154 million as a result of the announced acquisition of two vaccines from GlaxoSmithKline.

A detailed guidance for 2020 will be provided in connection with the publication of the Company’s annual report for 2019. However, pending a successful closing of the transaction with GSK, the Company is able to confirm that it will be profitable on an EBITDA basis already in 2020, exclusive of the sale of the Priority Review Voucher, which was awarded the Company by FDA upon the approval of JYNNEOS in September.

The financial expectations are based on an exchange rate of DKK 6.50 per 1.00 USD. For further details regarding assumptions behind the guidance see the Annual Report 2018.

Financial calendar 2019/2020
The date for announcement of the 2019 annual report has been changed to February 20, 2020.

November 27, 2019 Extraordinary General Meeting *
February 20, 2020 2019 Annual Report
April 21, 2020 Annual General Meeting **
May 14, 2020 First quarterly report (Q1) for the three-month period ended March 31, 2020
August 26, 2020 Half-year report (Q2) for the six-month period ended 30 June 2020
November 11, 2020 Third quarterly report (Q3) for the nine-month period ended 30 September 2020
* An extraordinary general meeting has been convened to seek shareholder approval to increase the Company’s share capital through a planned rights issue in the first half of 2020 with pre-emptive rights for the existing shareholders in order to obtain financing of costs associated with the acquisition of Rabipur/RabAvert and Encepur. See www.bavarian-nordic.com/egm for additional information.

** Pursuant to Article 12 of the Articles of Association, shareholders who wish to submit a request for proposals for consideration at the annual general meeting must lodge this with the Company no later than Wednesday, March 11, 2020.

OTHER DEVELOPMENTS

Incentive programs for employees and executive management in Bavarian Nordic
The board of directors has today decided to issue warrants to executive management and certain employees in the Bavarian Nordic Group. The decision is made in accordance with the shareholder authorization for the board of directors adopted as Article 5b of the Articles of Association and the Company’s guidelines regarding incentive programs.

The warrant program entails the issuance of 564,585 warrants in total which entitle the warrant holders to subscribe for up to 564,585 shares in total with a nominal value of DKK 10 each at an exercise price of DKK 185.4 per share. The warrants may be exercised wholly or partly during eight fixed subscription periods during 2023 and 2024.

The value of each warrant equals DKK 45.5 and is calculated on the Black-Scholes model with a risk-free interest rate of -0.69 per cent and on the historical volatility of the shares. The calculation is based on a share price of DKK 154.05.

Furthermore, the Company introduces a three-year incentive program in January 2020 for all employees in the Bavarian Nordic Group, with the exception of employees receiving warrants. The program is a cash bonus program based on the development in the Company’s share price. The incentive program will not have a dilutive effect on the shareholders.

Each employee participating in the program is awarded so-called phantom shares every month of employment until 31 December 2022. The exercise price is DKK 185.4. The phantom shares may be exercised in January 2023, only if the Company’s share price by then exceeds the exercise price by at least DKK 5. In that case, each phantom share will yield a cash bonus equivalent to DKK 1 per point the share price exceeds the exercise price.

Based on the current number of employees in the Group eligible for participating in the program, the program will comprise up to 72,288 phantom shares. The average value of each phantom share granted equals DKK 27.7 calculated on the basis of the Black-Scholes model with a risk-free interest rate of -0.69 per cent and on the historical volatility of the shares. The calculation is based on a share price of DKK 154.05.

Conference call and webcast
The management of Bavarian Nordic will host a conference call today at 2 pm CET (8 am ET) to present the interim results followed by a Q&A session. A listen-only version of the call can be accessed via View Source To join the Q&A session, use one of the following dial-in numbers: Denmark: +45 32 72 80 42, UK: +44 (0) 844 571 8892, USA: +1 631-510-7495. Participant code is 8772778.

On November 4, 2019, Abeona Therapeutics Inc. (the "Company") reported that it entered into the First Amendment to License Agreement (the "First Amendment") with REGENXBIO Inc. (the "Licensor"), which amends the license agreement between the Company and the Licensor entered into on November 4, 2018 (the "Original Agreement," and as amended by the First Amendment, the "Agreement") (Filing, 8-K, Abeona Therapeutics, NOV 7, 2019, View Source [SID1234550638]). As disclosed previously, the Agreement grants the Company an exclusive, worldwide commercial license, with rights to sublicense, to the NAV AAV9 vector for the treatment of the certain indications in humans by in vivo gene therapy. The First Amendment amends the Original Agreement solely to replace the $10 million payment due to the Licensor within one year of the Original Agreement with a provision stating that the Licensor shall receive $3 million within one year of the Original Agreement and another $8 million no later than April 1, 2020.

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On November 7, 2019 Navidea Biopharmaceuticals, Inc. (NYSE American: NAVB) ("Navidea" or the "Company"), a company focused on the development of precision immunodiagnostic agents and immunotherapeutics, reported its financial results for the third quarter ended September 30, 2019 (Press release, Navidea Biopharmaceuticals, NOV 7, 2019, View Source [SID1234550637]).

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"During the third quarter, Navidea continued to deliver on the Company’s initiatives to complete the NAV 3-31 Phase 2B trial in patients with Rheumatoid Arthritis ("RA")," said Mr. Jed A. Latkin, Chief Executive Officer of Navidea. "The Company furthered its partnership discussions around the globe, and most importantly, met its internal enrollment goals for the ongoing RA trials. We also achieved several key milestones in Navidea’s clinical pipeline, and continue to advance programs in the therapeutics division. Navidea remains focused on potentially bringing its RA diagnostic to market within the next 18 to 24 months."

Third Quarter 2019 Highlights and Subsequent Events

Continued with double-digit subject enrollment in the Company’s NAV3-31 Phase 2b study in rheumatoid arthritis ("RA").

Announced positive results of the first interim analysis of the NAV3-31 Phase 2b study, demonstrating that Tc99m tilmanocept imaging can provide robust, quantitative imaging in healthy controls and in patients with active RA, and that this imaging is stable, reproducible, and can define joints with and without RA-involved inflammation.

Entered into a collaboration agreement with IMV Inc., a clinical-stage immuno-oncology company, to explore the combinatory effect of Navidea’s and IMV’s proprietary immuno-oncology platforms.

Received the Notice of Award from the National Heart, Lung and Blood Institute for the Small Business Technology Transfer Phase 1 grant application that will support a collaboration with the University of Alabama at Birmingham titled "Gallium 68 Tilmanocept for PET Imaging of Atherosclerosis Plaques", with studies set to begin shortly.

Completed patient enrollment in NAV3-24, the NIH-funded imaging trial in Kaposi Sarcoma patients titled, "An Evaluation of the Safety of Escalating Doses of Tc 99m Tilmanocept by Intravenous (IV) Injection and a Comparison to Subcutaneous (SC) Injection in Human Immunodeficiency Virus (HIV) Subjects Diagnosed with Kaposi Sarcoma (KS)".

Continued enrollment in the Investigator Initiated Phase 2 trial being run at the Massachusetts General Hospital evaluating Tc 99m tilmanocept uptake in atherosclerotic plaques of HIV-infected individuals.

Michael Rosol, Chief Medical Officer for Navidea, said, "The clinical research team has been working diligently to advance the technology in key disease areas, with an emphasis on our ongoing RA trials. We continue to advance our Phase 2B trial in RA, building upon the recently announced interim analysis results, and are planning ahead for the Phase 3 trial."

Financial Results

Navidea’s consolidated balance sheets, statements of operations, and statements of stockholders’ equity have been restated, as required, for all periods presented to reflect the April 2019 reverse stock split as if it had occurred on January 1, 2018. The consolidated statements of cash flows were not impacted by the reverse stock split.

Total revenues for the third quarter of 2019 were $237,000, compared to $231,000 in the same period of 2018. Total revenues for the first nine months of 2019 were $539,000, compared to $1.1 million in the same period of 2018. The year-to-date decrease was primarily due to a decrease in license revenue related to the sublicense of the Company’s NAV4694 technology, which included a non-refundable upfront payment in 2018, coupled with a reduction in grant revenue related to Small Business Innovation Research grants from the National Institutes of Health supporting Manocept development.

Research and development ("R&D") expenses for the third quarter of 2019 were $1.8 million, compared to $1.2 million in the same period of 2018. R&D expenses for the first nine months of 2019 were $3.6 million, compared to $3.4 million in the same period of 2018. The year-to-date increase was primarily due to net increases in drug project expenses, which includes Manocept diagnostic and Tc99m tilmanocept development costs, offset by decreased Manocept therapeutic and NAV4694 development costs. The net increase in R&D expenses also included decreased compensation costs resulting from net decreased salaries and headcount.

Selling, general and administrative ("SG&A") expenses for the third quarter of 2019 were $1.5 million, compared to $2.7 million in the same period of 2018. SG&A expenses for the first nine months of 2019 were $5.1 million, compared to $6.2 million in the same period of 2018. Decreased compensation, primarily related to the resignation of the former CEO in 2018, coupled with net decreased related support costs such as director compensation, general office expenses and taxes, were offset by increased legal and professional services, primarily related to the Goldberg litigation.

Navidea’s net loss attributable to common stockholders for the third quarter of 2019 was $3.1 million, or $0.17 per share, compared to a net loss attributable to common stockholders of $3.8 million, or $0.46 per share, for the same period in 2018. Navidea’s net loss attributable to common stockholders for the first nine months of 2019 was $8.2 million, or $0.62 per share, compared to a net loss attributable to common stockholders of $13.0 million, or $1.58 per share, for the same period in 2018.

Navidea ended the third quarter of 2019 with $2.8 million in cash and investments.

Conference Call Details

Investors and the public are invited to dial into the earnings call through the information listed below, or participate via the audio webcast on the company website. Participants who would like to ask questions during the question and answer session will be prompted by the moderator, who will provide instructions.

Event:

Q3 2019 Earnings and Business Update Conference Call

Date:

Thursday, November 7, 2019

Time:

5:00 p.m. (EST)

U.S. & Canada Dial-in:

877-407-0312

International Dial-in:

+1 201-389-0899

Conference ID:

13696379

Webcast Link: View Source

A live audio webcast of the conference call will also be available on the investor relations page of Navidea’s corporate website at www.navidea.com. In addition, the recorded conference call can be replayed and will be available for 90 days following the call on Navidea’s website.

On November 7, 2019 Pfenex Inc. (NYSE American: PFNX) is a development and licensing biotechnology company focused on leveraging its Pfēnex Expression Technology to develop and improve protein therapies for unmet patient needs (Press release, Pfenex, NOV 7, 2019, View Source [SID1234550636]). Using the patented Pfēnex Expression Technology platform, the Company has developed the FDA-approved PF708 product indicated for the treatment of osteoporosis in certain patients at high risk of fracture and created an advanced pipeline of therapeutic equivalents, biologics and vaccines. Pfenex Inc. reported financial results for the third quarter ended September 30, 2019 and provided a business update.

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"The Pfenex team is very excited and proud of our FDA approval for PF708, the first approved drug developed in our proprietary platform. It signifies an important milestone for the company, and we believe sets us up for continued success. In addition, we continue to execute on our plan and achieved several key milestones in the third quarter, including successful completion of the PF708 comparative use HF study, supporting Alvogen in advancing PF708 regulatory and commercial activities outside of the U.S., and process development activities for PF745, a recombinant crisantaspase with half-life extension technology under our Jazz collaboration. As a result, we earned $13.5 million in milestone payments during the third quarter of 2019. Most importantly, all of these milestones continue to validate the company’s unique expression technology, as well as our ability to execute successfully," said Eef Schimmelpennink, Chief Executive Officer of Pfenex.

Business Review and Update

FDA-approved PF708 product and proposed therapeutic equivalent to Forteo

On October 7, 2019, Pfenex announced that the U.S. Food and Drug Administration (FDA) approved the new drug application (NDA) for PF708 submitted under the 505(b)(2) regulatory pathway, with Forteo (teriparatide injection) as the reference drug. Like Forteo, the FDA-approved PF708 product is indicated for the treatment of osteoporosis in certain patients at high risk of fracture. Pfenex believes PF708 has the potential to significantly enhance patient access to an important therapy as a cost-effective alternative to Forteo, which had $1.6 billion in global sales in 2018. In October, Pfenex earned a $2.5 million milestone payment from Alvogen for U.S. approval of PF708 and is eligible to earn another $20 million milestone payment if the FDA grants an "A" therapeutic equivalence rating to PF708.

Pfenex is seeking FDA designation of the recently-approved PF708 product as therapeutically equivalent ("A" rated) to Forteo, which would permit PF708 to be automatically substituted for Forteo in many states. To further support an "A" rating, Pfenex recently submitted a comparative use human factors study report, as requested by FDA. Pfenex believes that this completes the information package required by the FDA to evaluate the therapeutic equivalence of PF708. Pfenex currently expects its U.S. commercial partner, Alvogen, to launch PF708 upon an FDA decision on the therapeutic equivalence rating.

Alvogen, which also has exclusive development and commercialization rights for PF708 in the European Union (EU), Middle East and North Africa (MENA) and the Rest-of-World territories (except those licensed to NT Pharma), has in the third quarter entered into additional exclusive commercialization agreements for PF708 with PharmBio Korea in South Korea, JAMP Pharma in Canada and Kamada Ltd. in Israel. Furthermore, Alvogen’s partner in the MENA region, SAJA, submitted a Marketing Authorization Application (MAA) to the Kingdom of Saudi Arabia’s Saudi Food and Drug Authority (SFDA). Additionally, the accepted MAA for PF708 under review by the European Medicines Agency (EMA) continues to make progress, and Pfenex believes PF708 could receive regulatory approval in the EU as early as the second half of 2020, subject to granting of a marketing authorization by the European Commission under the EU centralized procedure and other factors. If approved, PF708 would receive marketing authorization in all 28 member states of the EU, as well as in Iceland, Liechtenstein and Norway and be commercialized by Alvogen’s partner Theramex. The MAA for PF708 was submitted by Alvogen to the EMA as a biosimilar to Forsteo, which achieved $289 million sales in the E.U. and $1.6 billion in global product sales in 2018.

Jazz Collaboration Agreement

Pfenex announced in the third quarter that it earned an $11 million development milestone payment under its development and license agreement with Jazz Pharmaceuticals (Jazz) and received the milestone payment in October 2019. The milestone is associated with process development activities for PF745 (JZP-341), a long-acting Erwinia asparaginase. Jazz announced in its third quarter earnings that they expect to initiate a Phase 2/3 pivotal study for PF743 (JZP-458), a recombinant Erwinia asparaginase, later this year and anticipates completing enrollment by fourth quarter 2020. The study is expected to enroll approximately 100 patients with a planned interim analysis at approximately 50 patients. Jazz also announced receiving fast track designation for PF743.

Under the terms of the development and license agreement, Pfenex is eligible to receive an aggregate total of up to $224.5 million in development and sales milestone fees, of which $177.5 million is still eligible to be received by Pfenex. Of this $177.5 million, $18.5 million are development milestones, $34 million are regulatory milestones, and $125 million are sales milestones. Pfenex is also eligible to receive tiered royalties on worldwide sales of any products resulting from the collaboration.

CRM197

CRM197 is a non-toxic mutant of diphtheria toxin. It is a well characterized protein and functions as a carrier for polysaccharides and haptens, making them immunogenic. CRM197 is currently being used by Pfenex’s vaccine development focused pharmaceutical partners, including in multiple Phase 3 clinical studies by Merck and the Serum Institute of India Private Ltd. (SIIPL) for such diseases as pneumococcal and meningitis bacterial infections.

Merck is using Pfenex’s CRM197 in its vaccines including PCV-15 (V114), an investigational 15-valent polyvalent conjugate vaccine for the prevention of pneumococcal disease, currently in 15 Phase 3 studies. Merck stated in their second quarter 2019 earnings results that Phase 3 data from their PCV-15 comprehensive development program may become available by the end of 2019.

SIIPL is using Pfenex’s CRM197 in multiple programs. SIIPL announced that it expects that its most advanced product, Pneumosil, could complete the World Health Organization (WHO) prequalification process and subsequently be launched in the first quarter of 2020. A second product being developed by SIIPL is a thermostable Pentavalent Meningococcal Conjugate Vaccine for which SIIPL initiated a Phase 3 study in the third quarter of 2019. Both of these products are targeting markets in developing countries. Pfenex is eligible to receive a tiered royalty payment based upon net sales for both products, subject to regulatory approval.

Arcellx – sparX Protein Development Agreement

In August, Pfenex announced its development, evaluation and license agreement with Arcellx which provides access to the Pfēnex Expression Technology platform to advance Arcellx’s proprietary sparX proteins that activate, silence and reprogram antigen-receptor complex T cell-based therapies. Under the terms of the agreement, Pfenex is eligible to receive development funding in addition to development, regulatory and commercial milestones ranging from $2.6 million to $18 million for each product incorporating a sparX protein expressed using the Pfēnex Expression Technology, as well as royalties on worldwide sales of any such products.

Board of Directors and Scientific Advisory

Board In August, Pfenex welcomed Dr. Lorianne Masuoka to the Pfenex Board of Directors. Her appointment further aligns the Board with the Company’s strategy to build a new R&D capability and Pfenex believes Dr. Masuoka’s extensive experience successfully expanding the development pipelines of several biotech companies makes her a valuable counselor to the Pfenex executive team. Dr. Masuoka has more than 20 years of experience building and expanding high value pipelines in the biopharmaceutical industry that have resulted in drug approvals and strategic alliances. She is a board-certified neurologist who has successfully created and overseen high performing teams to lead the clinical development of new medicines, with a focus in neurology, CNS, and pain. Dr. Masuoka served as chief medical officer of InVivo Therapeutics, Cubist Pharmaceuticals (now Merck), and Nektar Therapeutics where, as a member of executive management, she oversaw and managed teams in the areas of clinical research, drug safety, biostatistics and data management, regulatory affairs, reimbursement and clinical operations.

In September, Pfenex announced the appointment of Steve Kay, Ph.D., to its Scientific Advisory Board. Dr. Kay is a highly regarded biologist who brings a wealth of research experience to the Scientific Advisory Board and complements the existing board in support of the Pfenex scientific strategy. Dr. Kay is one of the world’s top experts on the genetics and genomics of circadian rhythms. Having published more than 200 papers, he was named by Thomson Reuters as one of "The World’s Most Influential Scientific Minds" from 2014 to 2019. Dr. Kay currently serves as the Director of the University of Southern California (USC) MESH (Medicine, Engineering, Sciences, and Humanities) Academy, the Director of the USC Michelson Center for Convergent Bioscience, and is a Provost Professor of Neurology, Biomedical Engineering and Biological Sciences at the Keck School of Medicine of USC.

Financial Highlights for the Third Quarter 2019

Total Revenue increased by $11.6 million, or 327%, to $15.2 million in the three-month period ended September 30, 2019, compared to $3.6 million in the same period in 2018. The increase in revenue was primarily due to an $11 million development milestone reached during the quarter related to the Jazz collaboration agreement.

Cost of Revenue decreased by approximately $0.4 million, or (23%), to $1.1 million in the three- month period ended September 30, 2019, compared to $1.5 million in the same period in 2018. The decrease was primarily due to the decreased activity related to our BARDA program.

Research and development expenses decreased by approximately $2.1 million, or (23%), to $6.9 million in the three-month period ended September 30, 2019, compared to $9.0 million in same period in 2018. The decrease was primarily due to the reduction of labor and subcontractor costs as the majority of the work performed to support the PF708 NDA filing was completed in late 2018.

Selling, general and administrative expenses increased by approximately $0.3 million, or 8%, to $4.1 million in the three-month period ended September 30, 2019, compared to $3.8 million in the same period in 2018. The increases were primarily due to an increase in expenses related to IP legal, consulting, and the expansion of business development efforts.

Cash and cash equivalents as of September 30, 2019, were $32.7 million. This balance excludes $13.5 million of development and regulatory milestones that were earned in September and October 2019. Pfenex believes that its existing cash and cash equivalents and cash inflow from operations will be sufficient to meet Pfenex’s anticipated cash needs for at least the next 12 months.

Conference Call Information

The Pfenex management will host a conference call and webcast today at 4:30 PM Eastern Time. Participants may access the call by dialing 866-376-8058 (Domestic) or 412-542-4131 (International). The call will also be webcast and can be accessed from the Investors section of the Company’s website at www.pfenex.com or View Source

A replay of the call will also be available through November 14th. Participants may access the replay of the call by dialing 877-344-7529 (Domestic) or 412-317-0088 (International) and providing the conference ID number: 10136405.

About PF708

PF708 was approved in the U.S. under the 505(b)(2) regulatory pathway, with Forteo (teriparatide injection) as the reference drug. The FDA-approved PF708 product is indicated for the treatment of osteoporosis in certain patients at high risk of fracture. Pursuant to the Development and License Agreement with Alvogen, Alvogen is responsible for commercializing and manufacturing PF708 in the U.S. and for fulfilling all regulatory requirements associated with maintaining the PF708 NDA. Alvogen also has exclusive rights to commercialize and manufacture PF708 in the EU, certain countries in the Middle East and North Africa (MENA), and the Rest of World (ROW) territories (the latter defined as all countries outside of the EU, U.S. and MENA, excluding Mainland China, Hong Kong, Singapore, Malaysia and Thailand). A marketing authorization application for PF708 has been filed and accepted with the EMA using the biosimilar pathway with Forsteo as the reference medicinal product and has been filed with the Kingdom of Saudi Arabia’s Saudi Food and Drug Authority (SFDA). Pursuant to the Development and License Agreement with NT Pharma Group Company Ltd. (NT Pharma) we granted an exclusive license to NT Pharma to commercialize PF708 in Mainland China, Hong Kong, Singapore, Malaysia and Thailand and a non-exclusive license to conduct development activities in such territories with respect to PF708. Forteo and Forsteo are approved and marketed by Eli Lilly companies for the treatment of osteoporosis in certain patients with a high risk of fracture. Forteo and Forsteo achieved $1.6 billion in global product sales in 2018.

On November 7, 2019 CytomX Therapeutics, Inc. (Nasdaq: CTMX), a clinical-stage oncology-focused biopharmaceutical company pioneering a novel class of investigational antibody therapeutics based on its Probody therapeutic technology platform, reported third quarter 2019 financial results (Press release, CytomX Therapeutics, NOV 7, 2019, View Source/news-releases/news-release-details/cytomx-therapeutics-announces-third-quarter-2019-financial" target="_blank" title="View Source/news-releases/news-release-details/cytomx-therapeutics-announces-third-quarter-2019-financial" rel="nofollow">View Source [SID1234550635]).

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As of September 30, 2019, CytomX had cash, cash equivalents and short-term investments of $325.7 million.

"The CytomX clinical pipeline made excellent progress in Q3 as we continued to advance multiple Probody therapeutic programs across the portfolio," said Sean McCarthy, D.Phil., president, chief executive officer and chairman of CytomX Therapeutics. "The initiation of a Phase 2 trial of our anti-PD-L1 Probody CX-072 in combination with ipilimumab in patients with relapsed refractory melanoma marks our ongoing evolution into a product-focused company seeking to realize the full potential of our novel technology platform. Our first in class Probody Drug Conjugate programs, CX-2009 and CX-2029, also continued to move forward and our pipeline overall is positioned for significant data updates in 2020."

Business Highlights and Recent Developments

CX-072 Anti-PD-L1 Probody Therapeutic Clinical Program

In October, CytomX announced the initiation of the PROCLAIM (Probody Clinical Assessment In Man) CX-072-002 Phase 2 study evaluating the efficacy and tolerability of the anti-PD-L1 Probody CX-072, in combination with the anti-CTLA-4 antibody, ipilimumab, in patients with relapsed or refractory melanoma. The study utilizes a Simon Two-Stage design with approximately 40 patients being enrolled into Stage 1. CytomX anticipates initial data from Stage 1 in 2020. Additional information on this trial is available at ClinicalTrials.gov using the identifier NCT03993379.
The Company also announced in October updated clinical data from the Phase 1 PROCLAIM-CX-072-001 dose-finding study of CX-072 in combination with ipilimumab. With enrollment complete, 27 evaluable patients had received ipilimumab (3, 6 or 10 mg/kg) combined with CX-072 (0.3, 1, 3 or 10 mg/kg), with the study achieving a disease control rate (stable disease or better) of 37%. 5 patients achieved confirmed objective responses by RECIST v1.1, including one complete response, for an overall response rate (ORR) of 19% in this heavily pretreated patient population. The median duration of response was 14.6 months (1.9 – 21.2 months) with 4 of the 5 responders still on treatment as of the latest data snapshot. Of the 27 patients treated across all doses, Grade 3/4 treatment related adverse events (TRAEs) were reported in 9 (33%) patients. Grade 3/4 immune-related adverse events (irAEs) were reported in 3 (15%) patients.
Enrollment within the monotherapy cohorts of the PROCLAIM-CX-072-001 study is complete with evaluation of the activity and tolerability of CX-072 monotherapy continuing with ongoing treatment in select cohorts. Additional information on this trial is available at ClinicalTrials.gov using the identifier NCT03013491.
CX-2009 Anti-CD166 Probody Drug Conjugate Clinical Program

CytomX anticipates announcing next steps for the PROCLAIM-CX-2009 clinical program by the end of 2019.
BMS-986249 Anti-CTLA-4 Probody Therapeutic Clinical Program

Bristol-Myers Squibb (BMS) is conducting a Phase 1/2a dose escalation clinical study evaluating BMS-986249 alone and in combination with OPDIVO (nivolumab) in advanced solid tumors.
BMS is preparing to initiate the Phase 2 portion of this clinical trial, upon which CytomX is entitled to a $10 million milestone payment. Additional information on this trial is available at ClinicalTrials.gov using the Identifier NCT03369223.
CX-2029 Anti-CD71 Probody Drug Conjugate Clinical Program

CytomX continued enrollment of patients in the PROCLAIM-CX-2029 Phase 1/2 study, which is partnered with AbbVie, evaluating CX-2029 as monotherapy in patients with solid tumors or lymphomas. Additional information on this trial is available at ClinicalTrials.gov using the Identifier NCT003543813.
Additional Corporate Highlights

In October, the Company announced the appointment of Amy C. Peterson, M.D., as executive vice president and chief development officer. In this new role, Dr. Peterson will have oversight of a multi-disciplinary team focused on advancing all aspects of CytomX’s clinical development activities.
In July, the Company announced that its partner AbbVie selected a second target under the companies’ 2016 Discovery Collaboration and Licensing Agreement to discover and develop Probody drug conjugates. The target selection triggered a $10 million payment to CytomX from AbbVie.
Third Quarter 2019 Financial Results
Cash, cash equivalents and short-term investments totaled $325.7 million as of September 30, 2019, compared to $436.1 million as of December 31, 2018.

Revenue was $10.7 million for the three months ended September 30, 2019, compared to $12.5 million for the three months ended September 30, 2018. The decrease in revenue of $1.8 million for the three months ended September 30, 2019 compared to the corresponding period in 2018 was primarily due to a $1.7 million decrease in revenue recognition under the CD71 Agreement with AbbVie due to ongoing dose escalation.

Research and development expenses increased $0.4 million during the three months ended September 30, 2019 compared to the corresponding period in 2018. The increase was attributable to an increase of $1.3 million in personnel-related expenses primarily due to an increase in headcount; an increase of $0.7 million in consulting expenses resulting from increased clinical trial activities and an increase of $0.8 million in the allocation of information technology and facilities related expenses driven partly from an increase in headcount; which amounts were offset by a decrease of $2.4 million in laboratory contracts and services and laboratory supplies as a result of timing of manufacturing activities as well as reduced costs relating to CX-188 which is not presently being advanced.

General and administrative expenses increased by $0.3 million during the three months ended September 30, 2019 compared to the corresponding period in 2018. The increase was attributable to an increase of $0.4 million in consulting expenses primarily related to IT, software implementation and finance services; an increase of $0.5 million in dues and subscriptions primarily related to software and other IT services; an increase of $0.2 million in building maintenance charges; which amounts were partially offset by a decrease of $0.8 million of information technology and facilities-related expenses allocated to the general and administrative functions.

Teleconference Scheduled Today at 5:00 p.m. ET
Conference Call/Webcast Information

CytomX management will host a conference call today at 5:00 p.m. ET. Interested parties may access the live audio webcast of the teleconference through the "Investor & News" section of CytomX’s website at View Source or by dialing 1-877-809-6037 (U.S. and Canada) or 1-615-247-0221 (International) and using the passcode 9449326. An archive of the webcast will be available on the CytomX website from November 7, 2019, until November 14, 2019.