On May 13, 2019 Takeda Pharmaceutical Company Limited (TOKYO:4502)(NYSE:TAK): FY2018 Full Year Results (Press release, Takeda, MAY 13, 2019, View Source [SID1234536236]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Legacy Takeda Underlying Revenue +5.3%; Consolidated reported revenue +18.5%

Underlying Revenue growth for Legacy Takeda was solid at +5.3%, with significant contributions from key growth products such as ENTYVIO (+34.8%) and NINLARO (+36.1%).
Consolidated reported revenue increased +18.5% to 2,097.2 billion yen. This was mainly due to the inclusion of Legacy Shire’s results from January 8, 2019, which was offset by the one-time negative impact from applying Takeda’s distribution channel policies to Legacy Shire products.
Legacy Takeda Underlying Core Earnings margin expanded +540 basis points

Legacy Takeda underlying Core Earnings grew +38.7%, with Opex discipline driving three fourths of the +540bps margin expansion. Legacy Takeda’s underlying Core Earnings margin has now expanded +960bps based on simple addition of gains in the last two years, driven by key growth products and execution of the Global Opex Initiative.
Legacy Takeda operating profit grew +70.3% mainly driven by business momentum. Large one-time gains in FY2017 from the divestiture of Wako Pure Chemical and the transfer of additional products to the Teva JV were matched by increased gains on sales of real estate and the divestitures of Multilab and Techpool in FY2018.
Consolidated reported operating profit decreased -15.2% to 205.0 billion yen, and consolidated reported EPS declined -52.6% to 113 yen per share, mainly impacted by significant non-cash purchase accounting expenses. The strong performance in Legacy Takeda reported operating profit entirely absorbed Shire acquisition-related costs incurred in FY2018.
Innovative R&D engine delivered important pipeline milestones

ENTYVIO demonstrated superior efficacy versus adalimumab in ulcerative colitis head-to-head VARSITY study4. Regulatory applications for a subcutaneous formulation filed in the U.S. for ulcerative colitis and Europe for ulcerative colitis and Crohn’s disease.5
Approvals in FY2018 for TAKHZYRO in the U.S. and Europe as well as ALUNBRIG in Europe. Important label expansions for ADCETRIS to include previously untreated Hodgkin lymphoma approved in Japan and Europe, as well as TRINTELLIX in the U.S. to include data on speed of processing and Treatment Emergent Sexual Dysfunction.
Innovative pipeline has delivered 15 New Molecular Entity clinical stage-ups since April 2018.
44 new collaborations with biotech and academia in FY2018, and announced 3 leading-edge cell-therapy partnerships.
Disposing non-core assets to generate cash and focus the business

Consolidated Free Cash Flow +4.6% to 378.1 billion yen, including 200.9 billion yen from the sale of real estate, marketable securities, and non-core businesses Techpool and Multilab.
On May 8, 2019, Takeda announced agreements to divest XIIDRA to Novartis for $3.4 billion upfront in cash and up to an additional $1.9 billion in potential milestones, and TACHOSIL to Ethicon for €358 million upfront with a long-term Manufacturing Services Agreement.6
Takeda intends to use proceeds from the disposal of non-core assets to reduce debt and accelerate deleveraging toward its target of 2.0x net debt/adjusted EBITDA in 3 to 5 years.
Christophe Weber, President and Chief Executive Officer of Takeda, commented:

"Fiscal 2018 was an important year in the history of Takeda as we completed the acquisition of Shire to create a competitive, values-based, R&D-driven global biopharmaceutical leader. I am delighted to say that throughout the year, while we have focused on planning and executing the integration, we have also maintained strong business momentum, as demonstrated by our excellent financial results.
The integration of Shire is progressing as planned, aligned with Takeda’s values and culture. We have also identified opportunities to realize greater cost synergies, and already have made progress on our divestment strategy for non-core assets.
Looking ahead, I believe we have a strong and resilient foundation for the future growth of the business. We are focused on our five key business areas of GI, Rare Diseases, Plasma-Derived Therapies, Oncology and Neuroscience, and our revenue over the medium term will be driven by a balanced portfolio including 14 global brands. Our innovative pipeline is also delivering, as shown by the 15 clinical stage-ups over the past year, and we are committed to executing towards our margin expansion and deleveraging targets.
With our business area focus, R&D engine, and financial strength, Takeda is well positioned to deliver long-term value to patients and our shareholders."

1References to "Legacy Takeda" exclude Legacy Shire financials (which have been consolidated into Takeda’s results from January 8, 2019 to March 31, 2019), costs incurred by Legacy Takeda and Legacy Shire related to the acquisition, and financial impact from purchase accounting. References to "Legacy Shire" are to the businesses acquired in Takeda’s acquisition of Shire, which was completed on January 8, 2019, and to the results of those businesses before or after the completion of the acquisition, as the context requires
2Gastroenterology (GI), Rare Diseases, Plasma-Derived Therapies, Oncology, and Neuroscience
3Entyvio, Gattex/Revestive, Alofisel, Vpriv, Elaprase, Natpara/Natpar, Adynovate, Takhzyro, HyQvia, Cuvitru, Gammagard Liquid/Kiovig, Albumin/Flexbumin, Ninlaro, Alunbrig
4Schreiber S, et al. J Crohns Colitis 2019;13(Supplement_1):S612–3 (abst OP34). [Oral presentation]
5Biologics Licensing Application in the U.S.; Marketing Authorization Line Extension Application in the EU
6Divestments of XIIDRA and TACHOSIL expected to close the second half of calendar year 2019, subject to customary closing conditions, including the satisfaction of legal, regulatory and, where applicable, local works council requirements.

FY2018 Consolidated Reported Results (April – March)

iAttributable to the owners of the company.
iiCore Earnings, which is not a measure presented in accordance with IFRS, represents net profit adjusted to exclude income tax expenses, our share of profit or loss of investments accounted for using the equity method, finance expenses and income, other operating expenses and income, amortization and impairment losses on intangible assets associated with products and other items that management believes are unrelated to our core operations, such as purchase accounting effects and transaction related costs.

iiiExcludes Legacy Shire financials (from January 8, 2019 to March 31, 2019), costs incurred by Legacy Takeda and Legacy Shire related to the acquisition, and financial impact from purchase accounting.
ivAttributable to the owners of the company.
vNumber of shares used for FY2018 EPS calculation: 784,477,109 shares (as of January 7, 2019, the day before the completion of the Shire acquisition)
viCore Earnings is not a measure presented in accordance with IFRS and represents net profit adjusted to exclude income tax expenses, our share of profit or loss of investments accounted for using the equity method, finance expenses and income, other operating expenses and income, amortization and impairment losses on intangible assets associated with products and other items that management believes are unrelated to our core operations, such as purchase accounting effects and transaction related costs.

FY2019 Full Year Guidance

FY2019 Management Guidance: Business momentum expected to largely offset significant Loss of Exclusivity headwinds

Momentum of key growth products in our 5 Key Business Areas is expected to largely offset the significant Loss of Exclusivity of VELCADE, FIRAZYR, ULORIC & other products.
Full year consolidation of Legacy Shire results, cost synergies and OPEX discipline is expected to contribute to underlying Core EPS of 350-370 yen.

Guidance
Underlying Revenue Growthvii Flat to slightly declining
Underlying Core Earnings Margin Mid-twenties %
Underlying Core EPS 350-370 yen
Annual dividend per share 180 yen
Financial assumption for VELCADE in the U.S. is for one additional non-therapeutically equivalent competitor with intravenous and subcutaneous administration launching in July 2019. If no additional competitor launches, pro-forma underlying revenue growth would be "flat to slightly increasing".
vii Constant Exchange Rate growth (applying FY2018 full year average foreign exchange rate) compared to baseline of JPY 3,300 billion (pro-forma April 2018-March 2019 combined revenue of Legacy Takeda and Legacy Shire, converted at April 2018-March 2019 average exchange rate of 111 JPY/USD)

Note: FY2019 Management Guidance does not take into consideration the recently announced divestitures of XIIDRA and TACHOSIL. However, Takeda does not expect these divestitures to have a meaningful impact on its management guidance.
Costa Saroukos, Chief Financial Officer of Takeda, stated:

"Our guidance for fiscal year 2019 reflects a significant impact from Loss of Exclusivity, without which the top-line would be growing by ~6-7 percentage points, driven by continued volume expansion of key products such as ENTYVIO, TAKHZYRO, NINLARO, and our Immunoglobulin franchise. We expect our Underlying Core Earnings margin to reach the mid-twenties in fiscal 2019, and we are targeting Underlying Core Earnings margin in the mid-thirties in the medium term, driven by continued Opex efficiencies and relentless execution against our cost synergy targets. After closing the Shire acquisition we conducted a deep-dive, bottoms-up review of the synergy opportunities, and I am pleased to say we are raising our cost synergy target from $1.4 billion to approximately $2 billion in annual recurring savings by the end of fiscal 2021.
In addition to margin improvement, we also are committed to rapid deleveraging towards our target net debt / adjusted EBITDA ratio of 2.0x in 3 to 5 years. This will be driven by strong cash flow, and accelerated deleverage from our divestitures such as the recently announced agreements to sell XIIDRA and TACHOSIL. In addition, we will continue to make focused investments in the business to support our growth drivers, and intend to maintain our well-established dividend policy of 180 yen per share annually.
Takeda has delivered against its commitments in FY2018, as exemplified in our superb margin improvement and cash generation, and we are committed to delivering against our future targets to drive significant returns for our shareholders."

FY2019 Forecast: Expecting strong increase in core earnings of +92.2%, with Net Profit excluding deal-related costs and the impact of purchase accounting growing at +17.7%

Anticipate Revenue up +57.4% vs. prior year due to inclusion of Legacy Shire’s full year results for the full year.
Expect Operating Profit and EPS to be significantly impacted by Shire acquisition-related integration costs and costs related to purchase accounting. Excluding the impact of Shire acquisition-related costs and purchase accounting, Net Profit for the year would increase +17.7% (refer to the attached appendix for details).
Anticipate Core Earnings strongly increasing +92.2% from full year Legacy Shire contribution, cost synergies and continued OPEX discipline.

For more details on Takeda’s FY2018 results and other financial information, please visit View Source

On May 13, 2019 F-star, a clinical-stage biopharmaceutical company delivering tetravalent bispecific antibodies for a paradigm-shift in cancer therapy, reported the reconfiguration of its immuno-oncology collaboration, established in 2017, with Merck KGaA, Darmstadt, Germany as it executes on its transition to a wholly-owned portfolio and builds scale and value as a world-class biopharmaceutical company (Press release, f-star, MAY 13, 2019, View Source [SID1234536235]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Under the terms of the new agreement, F-star retains exclusive rights to develop and commercialise FS118, a clinical-stage tetravalent bispecific antibody. At the same time, Merck has exercised its option for one discovery stage programme and retains the right to option a second discovery programme from the 2017 original agreement. No financial terms of the agreement are being disclosed.

Eliot Forster, CEO of F-star, said: "This new agreement reflects our pivot to building a wholly-owned pipeline, that allows for rapid progress into the clinic and secures greater long-term value from our products. With full rights to FS118, we have an opportunity to accelerate the development of this first-in-class medicine for a group of targeted cancer patients. We are also pleased to continue our long-term collaboration with Merck KGaA, Darmstadt, Germany by advancing assets from F-star’s Modular Antibody TechnologyTM into their pipeline."

FS118 is a potential first-in-class tetravalent bispecific antibody for the treatment of cancer, developed to overcome tumour evasion mechanisms promoted by two molecules (LAG-3: Lymphocyte-Activation Gene 3 and PD-L1: Programmed Death-Ligand 1) with the potential to restore the natural ability of the immune system to fight cancer(1). Initiated in April 2018 under F-star’s sponsorship, the Phase I trial (NCT03440437) continues as originally planned and is expected to read out during 2020.

(1) LAG-3/PD-L1 mAb² can overcome PD-L1-mediated compensatory upregulation of LAG-3 induced by single-agent checkpoint blockade. Faroudi et al. (March 2019) – Poster at the annual AACR (Free AACR Whitepaper) meeting

On May 13, 2019 GRAIL, Inc., a healthcare company whose mission is to detect cancer early, when it can be cured, reported that its multi-cancer test has been granted Breakthrough Device designation from the U.S. Food and Drug Administration (FDA) (Press release, Grail, MAY 13, 2019, View Source [SID1234536233]). The investigational blood test is in development for the early detection of multiple cancer types in individuals aged 50 or older. The FDA grants Breakthrough designation to devices that have the potential to provide for more effective diagnosis of life-threatening diseases such as cancer. The goal of the FDA’s Breakthrough Devices Program is to provide patients and healthcare providers with timely access to medical devices granted the designation by speeding up their development, assessment, and review.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We’re excited the FDA recognizes the potential of our multi-cancer early detection blood test. There are no effective early detection tests for the majority of cancer types, and many deadly cancers are often detected too late. We hope our test may offer a chance to address these challenges," said Jennifer Cook, Chief Executive Officer. "We have made significant progress developing our multi-cancer test and look forward to sharing new data at ASCO (Free ASCO Whitepaper) and other medical conferences this year."

GRAIL previously reported data from the first pre-planned sub-study of its Circulating Cell-free Genome Atlas (CCGA) study, which showed that its three prototype next-generation sequencing (NGS) blood tests were able to detect multiple deadly cancer types from a single blood draw, with a low rate of false positive results (high specificity).1 The company has since selected methylation as its preferred approach and has developed a methylation sequencing blood test that preferentially targets the most informative regions of the genome to both detect the presence of multiple types of cancer and identify the tissue of origin (the part of the body where the cancer originated). The blood test is currently being evaluated in the second pre-planned sub-study of CCGA.

New results from CCGA will be presented at the 2019 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting, including data on the ability of the company’s methylation technology to identify the tissue of origin when cancer is present. An analysis of survival of participants whose cancer was detected by the methylation technology, compared with those whose cancer was not detected by the technology, will also be presented.

About GRAIL’s Clinical Program

GRAIL is conducting what the company believes to be one of the largest clinical research programs ever pursued in genomic medicine. The program consists of three large-scale studies designed to enroll approximately 165,000 participants to create an atlas of genomic cancer signals in the blood, and to develop and evaluate GRAIL’s blood test for the early detection of multiple cancer types. Approximately 115,000 participants have been enrolled to date.

The CCGA study is a prospective, observational, longitudinal study that has completed enrollment of approximately 15,000 people with and without cancer across 142 sites in the United States and Canada. GRAIL is conducting three pre-planned sub-studies within CCGA to discover, train, and validate its multi-cancer early detection test.

The STRIVE study is a prospective, observational, longitudinal cohort study that has completed enrollment of approximately 100,000 women at the time of their screening mammogram across 37 sites in the United States. STRIVE is designed for clinical validation of GRAIL’s multi-cancer test in an intended use population. GRAIL anticipates reporting data from STRIVE in 2020.

The SUMMIT study is a prospective, observational, longitudinal cohort study that is enrolling participants in London in the United Kingdom. The study is designed to enroll approximately 50,000 men and women who do not have a cancer diagnosis at the time of enrollment. Approximately half of the participants will be people at high risk of lung and other cancers due to a significant smoking history, and the other half will be people who are not at high risk for cancer based on smoking history. SUMMIT is designed for clinical validation of GRAIL’s multi-cancer test in a second intended use population and to evaluate clinical utility of the test in a high-risk population.

About GRAIL’s Methylation Technology

GRAIL is developing an NGS blood test for the early detection of multiple deadly cancer types. GRAIL’s methylation technology preferentially targets the most informative regions of the genome and uses machine-learning algorithms to both detect the presence of cancer and identify the tumor’s tissue of origin when cancer is present.

DNA methylation is a natural process used by cells to regulate gene expression. It is a chemical modification to DNA and a well-studied epigenomic feature of the genome. In cancer, abnormal methylation patterns and the resulting changes in gene expression can contribute to tumor growth. For example, hypermethylation can cause tumor-suppressor genes to be inactivated.

On May 13, 2019 AngioDynamics, Inc. (NASDAQ: ANGO), a leading provider of innovative, minimally invasive medical devices for vascular access, peripheral vascular disease, and oncology, reported enrollment of the first patient in its NanoKnife Irreversible Electroporation (IRE) "Data IRE Cancer Treatment" clinical study (DIRECT) (Press release, AngioDynamics, MAY 13, 2019, View Source [SID1234536232]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

The DIRECT Study supports a proposed expanded indication for the NanoKnife System in the treatment of Stage III pancreatic cancer. The first patient enrollment closely follows the United States Food and Drug Administration’s (FDA) April 1, 2019 approval of AngioDynamics’ investigational device exemption (IDE) application.

"The enrollment of our first patient soon after receiving FDA approval is a strong signal that clinicians are eager to evaluate treatment alternatives that improve the dismal prognosis for Stage III pancreatic cancer patients," said Brent Boucher, AngioDynamics Senior Vice President and General Manager of Oncology. "We look forward to confirming that our proprietary NanoKnife technology offers a compelling alternative to the current standard of care and believe that this study will provide a pivotal dataset for claims and reimbursement purposes."

AngioDynamics’ DIRECT clinical study features a comprehensive data collection strategy that will provide meaningful clinical information to healthcare professionals, support a regulatory indication for the treatment of Stage III pancreatic cancer, and facilitate reimbursement for hospitals and treating physicians. The next-generation study is classified as a Category B IDE by the FDA, which allows participating sites to obtain coverage for procedures performed in addition to any related routine costs.

"We are pleased to be the first enrolling site. The DIRECT Study represents an important milestone in the standardization of care for patients with Stage III pancreatic cancer. Our goal is to generate important data that should standardize and optimize the use of IRE in the treatment of locally advanced pancreatic cancer, significantly improving outcomes for patients with this late-stage diagnosis," said Dr. Robert C.G. Martin, Co-Principal Investigator of the DIRECT Study and Surgical Oncologist at the University of Louisville.

The DIRECT Study comprises a Randomized Controlled Trial at up to 15 sites, as well as a Real-World Evidence, next-generation registry at up to 30 sites, each with a NanoKnife System treatment arm and a control arm. AngioDynamics expects each NanoKnife arm to consist of approximately 250 patients with an equal number of control patients. The primary endpoint of the study is overall survival.

As part of the DIRECT Study, AngioDynamics launched AngioDIRECT.com to facilitate the enrollment of participants. The online platform provides patients and their families with information about pancreatic cancer and details about the study. It also features a physician locator to help prospective participants and referring healthcare professionals identify clinical study locations.

There are approximately 57,000 new cases and 46,000 estimated deaths from pancreatic cancer in the United States annually1. Total deaths due to pancreatic cancer are projected to increase dramatically to become the second leading cause of cancer-related deaths before 20302. The mortality rate is high due to the aggressive nature of the disease and lack of early warning signs, and less than 20 percent of patients are candidates for surgical resection at time of diagnosis3. Approximately 35 to 40 percent of patients will present with Stage III and 45 to 55 percent with metastatic disease3. Regardless of the stage of pancreatic cancer, it is one of the least survivable cancers, and survival rates have not improved substantially for more than forty years3. For all stages combined, the five-year relative survival rate is 8 percent and, for those with advanced disease at the time of diagnosis, the five-year survival rate remains at 3 percent3.

On May 13, 2019 ORIC Pharmaceuticals, a privately held, clinical-stage oncology company focused on the discovery and development of novel therapies against treatment-resistant cancers, reported the initiation of patient dosing in a Phase 1b clinical study of ORIC-101 in combination with nab-paclitaxel (marketed as Abraxane by Celgene Corporation) in patients with advanced solid tumors (Press release, ORIC Pharmaceuticals, MAY 13, 2019, View Source [SID1234536231]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"Phase 1b initiation of ORIC-101 in patients with cancer represents a major milestone for ORIC," said Jacob Chacko, MD, Chief Executive Officer. "ORIC’s in-house discovery team, based on findings originating from Dr. Charles Sawyers’ laboratory, identified and developed a selective and potent oral inhibitor of the glucocorticoid receptor (GR), which has been linked to treatment resistance to multiple classes of anti-cancer therapeutics across a variety of solid tumors. Building on our recently completed study in healthy volunteers, we are looking forward to this first clinical study of ORIC-101 through which we hope to begin demonstrating the potential of ORIC-101 to benefit patients with cancer."

The Phase 1b trial is a dose finding, multi-center, open label study designed to evaluate the safety, pharmacokinetics, pharmacodynamics and clinical efficacy of ORIC-101 combined with nab-paclitaxel in patients with advanced solid tumors. Following identification of the recommended Phase 2 dose of ORIC-101 in combination with nab-paclitaxel, ORIC intends to enroll patients into expansion cohorts in selected tumor types based upon GR levels using its proprietary immunohistochemistry assay.

Subsequent to this initial Phase 1b study of ORIC-101 in combination with nab-paclitaxel, ORIC also plans to initiate additional Phase 1b studies of ORIC-101 in combination with other anti-cancer agents, including with androgen receptor modulators in patients with advanced prostate cancer and with immunotherapy agents. Ongoing and planned clinical studies of ORIC-101 are supported by research conducted at ORIC and recent clinical studies of ORIC-101 in healthy volunteers, which demonstrated that ORIC-101 appeared to be safe and well-tolerated, with a pharmacokinetic profile sufficient for oral once-daily dosing and pharmacodynamic activity suggestive of effective target engagement.

"Despite many new anti-cancer therapies, resistance remains a significant barrier to improved outcomes in most patients with advanced cancers," said Pratik Multani, MD, Chief Medical Officer. "We are excited to evaluate the potential of ORIC-101 to overcome what we believe to be a major mechanism of resistance, overexpression of GR. This first clinical trial kicks off a robust clinical development plan to evaluate ORIC-101, the first of our programs to enter the clinic, in combination with multiple classes of anti-cancer agents across various indications that span the range of solid tumor malignancies."

Further details about the clinical study are available at ClinicalTrials.gov (NCT03928314).