On May 8, 2019 Prometic Life Sciences Inc. (TSX: PLI) (OTCQX: PFSCF) ("Prometic" or the "Corporation") reported its unaudited financial results for the first quarter ended March 31, 2019 (Press release, ProMetic Life Sciences, MAY 8, 2019, View Source [SID1234535962]).

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"We are pleased to have completed the recapitalization transactions and equity offering in April that have provided both an improved capital structure and necessary cash liquidity from the $ 75 million gross proceeds received from Structured Alpha LP and Consonance Capital Management", stated Mr. Kenneth Galbraith, Chief Executive Officer. "In addition, the Corporation expects to commence the previously-announced rights offering in the coming weeks, which could provide up to a maximum of $75 million in additional gross proceeds to the Corporation".

"We made excellent progress during the quarter towards completing the necessary development work to permit re-filing of our Ryplazim (plasminogen) ("RyplazimTM ") BLA before the end of 2019. In addition, our bioseparations business had an excellent quarter with revenue growth of 55% compared to the same quarter in 2018."

"We look forward to reporting further progress on our business and R&D activities in the coming months and appreciate the continued support of our shareholders in helping to build a successful and focused global life sciences corporation, with the potential to address unmet medical needs of patients with serious diseases in multiple therapeutic areas of interest", added Mr. Galbraith.

2019 First Quarter Results

Revenues

Total revenues for the quarter ended March 31, 2019 were $8.2 million compared to $4.3 million during the comparative period of 2018 which represents an increase of $3.9 million.

Revenues from the sale of goods were $7.8 million during the quarter ended March 31, 2019 compared to $3.8 million during the corresponding period of 2018, representing an increase of $4.0 million which was due to an increase in the sales of our specialty plasma collected at our plasma collection center in Winnipeg by $1.9 million and the increase of the volume of sales of goods from our Bioseparations segment by $2.1 million compared to the comparative period in 2018.

Cost of sales and other production expenses
Cost of sales and other production expenses were $4.4 million during the quarter ended March 31, 2019 compared to $4.8 million for the corresponding period in 2018, representing a decrease of $0.4 million.

Research and Development ("R&D")
R&D expenses were $19.2 million during the quarter ended March 31, 2019 compared to $22.4 million for the corresponding period in 2018, representing a decrease of $3.2 million.

R&D expenses include the cost to manufacture plasma-derived therapeutics and small molecule therapeutics to be used in clinical trials and for the development of our production processes. The manufacturing and purchase cost of these therapeutics was $9.2 million during the quarter ended March 31, 2019 compared to $7.0 million during the quarter ended March 31, 2018, an increase of $2.2 million.

Other R&D expenses were $10.0 million during the quarter ended March 31, 2019 compared to $15.4 million for the corresponding period in 2018, a decrease of $5.5 million. The decrease is mainly due to the reduction in pre-clinical and clinical trial activity in both the plasma-derived therapeutics and small molecule segments.

Administration, Sales & Marketing
Administration, selling and marketing expenses remained stable at $7.6 million during the quarter ended March 31, 2019 compared to $7.7 million for the corresponding period in 2018 with consulting fees slightly declined offset by employee compensation expense increased.

Finance Costs
Finance costs were $7.4 million for the quarter ended March 31, 2019 compared to $4.2 million during the corresponding period of 2018, representing an increase of $3.1 million. This increase reflects the increased level of debt at higher effective interest rates applied during the quarter ended March 31, 2019 compared to the same period of 2018.

Furthermore, the increase in finance costs are also due to the adoption of the new lease standard, IFRS 16, Leases ("IFRS 16"), under which lease liabilities are recognized for the discounted value of the future lease payments at initial adoption and with interest expense recognized over the term of each lease. The new standard was adopted using the modified retrospective approach and as such, the 2018 figures are not restated. Previously, the embedded interest component in each lease payment was recognized as part of the lease expense included in the various functions presented in the statement of operations such as cost of sales and other production expenses, R&D and administration, selling and marketing. The interest expense over the lease liabilities was $1.8 million in the quarter ended March 31, 2019.

Net Loss
The Corporation incurred a net loss of $28.8 million during the quarter ended March 31, 2019 compared to a net loss of $34.6 million for the corresponding period of 2018, representing a decrease in the net loss of $5.8 million. This is mainly driven by the increase in revenue from sales of goods of $4.0 million, the decrease in R&D of $3.2 million and the increase in the gain of foreign exchange of $2.9 million which is due to a lower USD/CAD exchange rate over the comparative period. This was partially offset by the increase in finance costs expense of $3.1 million in the quarter ended March 31, 2019 compared to the corresponding period in 2018.

Commenting on the 2019 first quarter financial results, Bruce Pritchard, Prometic’s Chief Operating Officer – International and Chief Financial Officer, stated, "Our focus on cost control continues with an improvement in all areas, with the exception of finance costs, over the same quarter of 2018. Clearly, finance costs increased as a result of the increased borrowing required to finance the Corporation in the absence of substantial new equity or business development deals since the first quarter of 2018."

Small Molecule Therapeutics Segment

Q1 2019 Updates:

Following the completion of the review and prioritization of all programs and assets, and completion of refinancing transactions, the main priorities for the small molecule therapeutics segment are:

PBI-4050 – Prometic is planning to file an Investigational New Drug application to enable the commencement of the phase 3 clinical study of PBI-4050 in Alström Syndrome during H2-2019.
PBI-4050 – Prometic is planning a randomized, placebo-controlled phase 2 clinical study of PBI-4050 in patients with Nonalcoholic steatohepatitis ("NASH") to be initiated later in the year, subject to receipt of further financing.
PBI-4050 – Prometic is planning a randomized, placebo-controlled, phase 2 clinical study of PBI-4050 in patients with idiopathic pulmonary fibrosis ("IPF") to be initiated later in the year, subject to receipt of further financing
PBI-4547 – Prometic is planning a phase 1 clinical study to be initiated before the end of 2019.
Plasma-Derived Therapeutics Segment

Q1 2019 Updates:

Following the completion of the review and prioritization of all programs and assets, and completion of refinancing transactions, the main priorities for the plasma-derived therapeutics segment are

RyplazimTM – Refile the BLA for Ryplazim during H2-2019.
RyplazimTM – Conclude ongoing commercialization discussions and secure a strategic transaction with a third party partner for the commercialization of RyplazimTM for global markets.
Corporate and Operational Update

Q1 2019 Updates:

Management and the Board of Directors engaged in a comprehensive strategy to improve the financial and business conditions of the Corporation and, in January 2019, commenced a process to explore and evaluate potential strategic alternatives focused on maximizing shareholder value, including potential acquisitions, joint ventures, strategic alliances, or other merger and acquisition or capital markets transactions as well as any other transaction or alternative available to the Corporation.
In February 2019, the Corporation engaged Lazard, a global financial advisory and asset management firm, to review and execute key strategic transactions focused on maximizing shareholder value. The Corporation has not set a timetable for this process, and there can be no assurance that a transaction will be entered into or consummated, or, if a transaction is undertaken, as to its terms, structure or timing.
In conjunction with the strategic review and liquidity issues faced by the Corporation, in February 2019, the Board of Directors formed a special committee of independent board directors to oversee the strategic review process.
In February and March 2019, the Corporation secured two additional tranches for a total of US$15.0 million from SALP under its existing credit facility with SALP.
During the first quarter of 2019, the Corporation issued 12,870,600 common shares under the ATM for total net cash proceeds of $4.1 million.
Subsequent Events to Q1 2019:

The Corporation announced its intention to enter into a series of related arrangements to restructure Prometic’s outstanding indebtedness, reduce its interest and certain other payment obligations, and raise sufficient cash to build a robust balance sheet for the next phase of Prometic’s development.
The Corporation closed the recapitalization transactions and equity offering previously announced on April 15, 2019. Prometic received $75 million (approximately US$56 million) in gross proceeds from the equity offering led by Consonance Capital Partners and SALP and converted into equity substantially all of its indebtedness to SALP.
The Corporation announced Mr. Kenneth Galbraith as its CEO as well as the appointment of new Board leadership and structure in selecting Mr. Stefan Clulow as Chair of the Board and Prof. Simon Best as Lead Independent Director.
The Corporation implemented a new management structure to provide leadership to the Corporation and announced the appointment of Dr. Gary Bridger, Mr. Tim Wach and Mr. Neil Klompas to the Board of Directors.
Conference Call Information

Prometic will host a conference call at 8:30 am (ET) on Thursday May 9, 2019. The telephone numbers to access the conference call are (647) 427-7450 and 1-888-231-8191 (toll-free). A replay of the call will be available as of Thursday May 9, 2019 at 11:00 am. The numbers to access the replay are 1-416-849-0833 and 1-855-859-2056 (passcode: 8892627). A live audio webcast of the conference call, with slides, will be available through the following : View Source

Additional Information in Respect to the First Quarter Ended March 31, 2019

Prometic’s MD&A and condensed interim consolidated financial statements for the quarter ended March 31, 2019 will be filed on SEDAR (View Source) and will be available on the Corporation’s website at www.prometic.com.

On May 8, 2019 Titan Pharmaceuticals, Inc. (NASDAQ:TTNP) reported that it will announce its first quarter 2019 financial results after market close on Wednesday, May 15, 2019 (Press release, Titan Pharmaceuticals, MAY 8, 2019, View Source;conference-call-to-follow-300846864.html [SID1234535961]). Following the release, Titan management will host a conference call at 4:30 p.m. EDT / 1:30 p.m. PDT to review the financial results and discuss business developments in the period.

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The conference call will be hosted by Sunil Bhonsle, President and CEO; Kate Beebe DeVarney, Ph.D., Executive Vice President and Chief Scientific Officer; Dane Hallberg, Executive Vice President and Chief Commercial Officer; Brian Crowley, Vice President of Finance; and Marc Rubin, M.D., Executive Chairman.

The live conference call may be accessed by dialing 1-888-317-6003 (U.S.) or 1-412-317-6061 (international) and providing passcode 1059834. The call will also be broadcast live and archived on Titan’s website at www.titanpharm.com/news/events.

On May 8, 2019 Audentes Therapeutics, Inc. (Nasdaq: BOLD), a leading AAV-based genetic medicines company focused on developing and commercializing innovative products for serious rare neuromuscular diseases, reported that it will participate in the Bank of America Merrill Lynch Health Care Conference, taking place May 15-17 in Las Vegas, NV (Press release, Audentes Therapeutics, MAY 8, 2019, View Source [SID1234535959]).

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Matthew R. Patterson, Chairman and Chief Executive Officer, will participate in the following events during the conference:

Fireside Chat
Wednesday, May 15, 2019, at 3:40 pm PDT

Panel Discussion: Gene Therapy Landscape
Wednesday, May 15, 2019, at 4:20 pm PDT

To access a live webcast of the fireside chat, please visit the Events & Presentations page within the Investors + Media section of the Audentes website. A replay of the live webcast will be available on the Audentes website for approximately 30 days following the conference.

On May 8, 2019 McKesson Corporation (NYSE:MCK) reported that revenues for the fourth quarter ended March 31, 2019, were $52.4 billion compared to $51.6 billion a year ago, an increase of 2% on a reported basis and an increase of 3% on an FX-adjusted basis. For the fiscal year, McKesson had revenues of $214.3 billion, compared to $208.4 billion a year ago, an increase of 3% on a reported and FX-adjusted basis (Press release, McKesson, MAY 8, 2019, View Source [SID1234535958]).

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"McKesson delivered solid adjusted operating results, and we are pleased to conclude fiscal 2019 with adjusted EPS growth of 8%," said Brian Tyler, chief executive officer. "We successfully executed in a challenging environment and took action to address the headwinds in our European business. McKesson exits fiscal 2019 with improving momentum across many of our businesses. Our financial flexibility, reinforced by a strong balance sheet and solid cash flow generation, positions us to continue delivering shareholder value."

On the basis of U.S. generally accepted accounting principles ("GAAP"), fourth-quarter loss per diluted share from continuing operations was $(4.17), compared to loss per diluted share of $(5.58) a year ago. Full-year GAAP earnings per diluted share from continuing operations was $0.17, compared to GAAP earnings per diluted share from continuing operations of $0.30 a year ago. Fourth-quarter GAAP loss per diluted share and full-year GAAP earnings per diluted shared included after-tax net charges totaling approximately $1.5 billion and $2.2 billion, respectively, or $7.63 and $11.00 per diluted share, respectively, reflecting non-cash goodwill and long-lived asset impairment charges, as well as restructuring charges largely in the company’s European businesses.

Fourth-quarter Adjusted Earnings per diluted share was $3.69, an increase of 6% compared to $3.49 a year ago, primarily driven by a lower share count and growth in the Medical-Surgical business, partially offset by weakness in the U.K. retail pharmacy business, including an inventory charge recorded in the fourth quarter, and a higher adjusted tax rate. Full-year Adjusted Earnings per diluted share was $13.57, an increase of 8% compared to $12.62 for the prior year, primarily driven by a lower share count, growth in the McKesson Prescription Technology Solutions (MRxTS) and Medical-Surgical businesses and a lower adjusted tax rate, partially offset by lower profit contribution from the U.S. Pharmaceutical business related to the fourth quarter fiscal 2018 customer losses and weakness in the U.K. retail pharmacy business.

For the full year, McKesson generated cash from operations of $4.0 billion, and invested $557 million internally, resulting in free cash flow of $3.5 billion. During the year, McKesson paid $905 million for acquisitions, repurchased approximately $1.6 billion of its common stock, and paid $292 million in dividends. The company ended the quarter with cash and cash equivalents of $3.0 billion.

U.S. Pharmaceutical and Specialty Solutions Segment

Fourth Quarter: Revenues were $40.9 billion, up 3%, driven primarily by market growth, partially offset by branded to generic conversions and fourth-quarter fiscal 2018 customer losses. GAAP operating profit was $873 million and GAAP operating margin was 2.13%. Adjusted operating profit was $752 million, down 1%, and adjusted operating margin was 1.84%.
Full Year: Revenues were $167.8 billion, up 3%, driven primarily by market growth and acquisitions, partially offset by fourth-quarter fiscal 2018 customer losses and branded to generic conversions. GAAP operating profit was $2.7 billion and GAAP operating margin was 1.61%. Adjusted operating profit was $2.5 billion, down 2%, and adjusted operating margin was 1.50%.
European Pharmaceutical Solutions Segment

Fourth Quarter: Revenues were $6.8 billion, down 6% on a reported basis and up 2% on an FX-adjusted basis, driven primarily by market growth, partially offset by the fiscal 2018 actions to sell or divest owned retail pharmacies and a challenging market environment in the U.K. GAAP operating loss was $(1.5) billion and GAAP operating margin was (21.52)%. The segment recorded non-cash impairment charges of $1.4 billion in the fourth quarter, mainly due to declines in estimated future cash flows primarily attributed to the continued effects of U.K. government reimbursement reductions and competitive pressures in the U.K. Adjusted operating profit was $23 million, down 72%, and adjusted operating margin was 0.34%. On an FX-adjusted basis, adjusted operating profit was $26 million, down 68%, and adjusted operating margin was 0.36%. The segment results include an inventory charge of approximately $20 million in the fourth quarter.
Full Year: Revenues were $27.2 billion, flat on a reported basis and up 1% on an FX-adjusted basis, driven primarily by market growth, partially offset by the fiscal 2018 reduction in owned retail pharmacies and a challenging market environment in the U.K. and France. GAAP operating loss was $(2.0) billion and GAAP operating margin was (7.26)%. The segment GAAP results include full-year pre-tax restructuring charges of $63 million as a result of actions taken to address performance in the segment. Adjusted operating profit was $219 million, down 36%, and adjusted operating margin was 0.80%. On an FX-adjusted basis, adjusted operating profit was $220 million, down 35%, and adjusted operating margin was 0.80%.
Medical-Surgical Solutions Segment

Fourth Quarter: Revenues were $2.0 billion, up 13%, driven primarily by an acquisition and growth in the Primary Care and Lab Solutions businesses. GAAP operating profit was $121 million and GAAP operating margin was 6.19%. Adjusted operating profit was $172 million, up 21%, and adjusted operating margin was 8.80%.
Full Year: Revenues were $7.6 billion, up 15%, driven primarily by an acquisition and growth in the Primary Care and Lab Solutions businesses. GAAP operating profit was $455 million and GAAP operating margin was 5.97%. Adjusted operating profit was $605 million, up 11%, and adjusted operating margin was 7.94%.
Other remaining businesses (primarily including McKesson Canada, MRxTS and equity accounting method investment in Change Healthcare)

Fourth Quarter: Revenues were $2.8 billion, down 6% on a reported basis and down 1% on an FX-adjusted basis, driven primarily by April 2018 government actions taken in Canada, partially offset by market growth. GAAP operating profit was $111 million and adjusted operating profit was $258 million, up 6%. On an FX-adjusted basis, adjusted operating profit was $261 million, up 7%.
Full Year: Revenues were $11.7 billion, down 1% on a reported basis and up 1% on an FX-adjusted basis, driven primarily by market growth, partially offset by government actions enacted in Canada and the fiscal 2018 sale of the company’s Enterprise Information Solutions business. GAAP operating profit was $394 million and adjusted operating profit was $995 million, up 7%. On an FX-adjusted basis, adjusted operating profit was $1.0 billion, up 8%.
Company Updates

Renewed pharmaceutical distribution relationship with CVS Health through June 2023.
McKesson relocated its global corporate headquarters from San Francisco, California, to Irving, Texas, effective April 1, 2019.
Board of Directors elected Dominic Caruso and Brad Lerman as new independent directors.
In January of 2019, the Board of Directors formed a Compliance Committee to enhance oversight of the company’s compliance programs and management’s identification and evaluation of the principal legal and regulatory compliance risks. Brad Lerman, who has significant experience leading global legal, government affairs, ethics and compliance functions, chairs the committee.
Following McKesson’s announcement of a $100 million contribution to create a non-profit foundation to address the opioid epidemic in March 2018, the Foundation for Opioid Response Efforts (FORE) appointed Dr. Andrea Barthwell as board chair and Dr. Karen A. Scott as president.
Enhanced leadership and executive teams: appointed Kirk Kaminsky president of U.S. Pharmaceutical and Specialty Solutions business effective April 15, 2019, and appointed Tracy Faber executive vice president and chief human resources officer effective October 1, 2019, following Jorge Figueredo’s announced retirement.
Cost Savings Target Update

As a result of actions taken in the second half of fiscal 2019 to address challenges in the European business and to better position the U.S. and Canadian businesses, the company now anticipates it will generate approximately $400 million to $500 million in annual pre-tax savings that will be substantially realized by the end of fiscal 2021, an increase from the prior expectation of $300 million to $400 million as previously announced on October 25, 2018.

"We are making important progress towards our initiatives and are confident that the actions we are taking position us for growth in fiscal 2020 and beyond," Tyler concluded.

Fiscal 2020 Outlook and Key Assumptions

McKesson expects full-year fiscal 2020 Adjusted Earnings per diluted share of $13.85 to $14.45, which reflects solid growth across the company’s operating segments, a continuation of disciplined, efficient capital deployment, investments in the business, increased costs for opioids litigation and modest improvement in the U.K. business.

The fiscal 2020 outlook is based on the following key assumptions and expectations, and is also subject to risk factors such as those described below:

McKesson to deliver low- to mid-single digit percent revenue growth and flat to low-single digit percent adjusted income from operations decline in fiscal 2020.
U.S. Pharmaceutical and Specialty Solutions to deliver low- to mid-single digit percent revenue and adjusted operating profit growth in fiscal 2020.
European Pharmaceutical Solutions to deliver low- to mid-single digit percent revenue and adjusted operating profit growth in fiscal 2020.
Medical-Surgical Solutions to deliver high-single digit percent revenue growth and high-single to low double-digit percent adjusted operating profit growth in fiscal 2020.
Other to deliver approximately flat to low-single digit percent revenue decline and adjusted operating profit is expected to decline low- to mid-single digit percent in fiscal 2020, which assumes the company’s continued 70% equity interest in Change Healthcare through March 31, 2020.
Adjusted corporate expenses to be between approximately $725 million and $775 million, primarily driven by an anticipated increase in opioid-related litigation costs, and investments in technology-related infrastructure and growth-oriented data and analytics capabilities.
Interest expense to be between $245 million and $265 million.
The guidance range assumes a full-year adjusted tax rate of approximately 18-19%, which may vary from quarter to quarter.
Foreign currency exchange rate movements to have a net neutral impact to adjusted earnings per diluted share year over year.
Free cash flow to be $2.8 billion to $3.0 billion, which is net of expected payments for property, plant and equipment and capitalized software expenditures of between $500 million and $700 million.
Weighted average diluted shares used in the calculation of earnings per share to be approximately 185 million for the year.
Conference Call Details

The company has scheduled a conference call for today, Wednesday, May 8th, at 8:00 AM ET. The dial-in number for individuals wishing to participate on the call is 323-794-2093. Holly Weiss, senior vice president, Investor Relations, is the leader of the call, and the password to join the call is ‘McKesson’. A telephonic replay of this conference call will be available for five calendar days. For individuals wishing to listen to the replay, the dial-in number is 719-457-0820 and the pass code is 3096337. An archive of the conference call will also be available on the company’s Investor Relations website at View Source

Upcoming Investor Events

McKesson management will be participating in the following investor conferences:

Bank of America Merrill Lynch Health Care Conference, May 14, 2019, in Las Vegas, Nevada; and
Goldman Sachs 40th Annual Global Healthcare Conference, June 11, 2019, in Rancho Palos Verdes, California.
Audio webcasts will be available live and archived on the company’s Investor Relations website at View Source A complete listing of upcoming events for the investment community is available on the company’s Investor Relations website.

Adjusted Earnings

McKesson separately reports financial results on the basis of Adjusted Earnings. Adjusted Earnings is a non-GAAP financial measure defined as GAAP income from continuing operations, excluding amortization of acquisition-related intangible assets, acquisition-related expenses and adjustments, LIFO inventory-related adjustments, gains from antitrust legal settlements, restructuring and asset impairment charges, and other adjustments. A reconciliation of McKesson’s GAAP financial results to Adjusted Earnings is provided in Schedules 2 and 3 of the financial statement tables included with this release.

The company does not provide forward-looking guidance on a GAAP basis prospectively as McKesson is unable to provide a quantitative reconciliation of this forward-looking non-GAAP measure to the most directly comparable forward-looking GAAP measure, without unreasonable effort, because McKesson cannot reliably forecast LIFO inventory-related adjustments, gains from antitrust legal settlements, restructuring and asset impairment charges, and other adjustments, which are difficult to predict and estimate. These items are inherently uncertain and depend on various factors, many of which are beyond the company’s control, and as such, any associated estimate and its impact on GAAP performance could vary materially.

FX-Adjusted

McKesson also presents its financial results on an FX-adjusted basis, which is the same measure formerly designated Constant Currency. The company conducts business worldwide in local currencies, including the Euro, British pound and Canadian dollar. As a result, the comparability of the financial results reported in U.S. dollars can be affected by changes in foreign currency exchange rates. FX-adjusted information is presented to provide a framework for assessing how the company’s business performed excluding the effect of foreign currency exchange rate fluctuations. The supplemental FX-adjusted information of the company’s GAAP financial results and Adjusted Earnings (Non-GAAP) is provided in Schedule 3 of the financial statement tables included with this release.

Free Cash Flow

McKesson also provides free cash flow, a non-GAAP measure. Free cash flow is defined as net cash provided by operating activities less payments for property, plant and equipment and capitalized software expenditures, as outlined in the company’s condensed consolidated statements of cash flows.

On May 8, 2019 Five Prime Therapeutics, Inc. (NASDAQ: FPRX), a clinical-stage biotechnology company focused on discovering and developing innovative immuno-oncology protein therapeutics, reported its results for the first quarter and provided an update on the company’s recent activities (Press release, Five Prime Therapeutics, MAY 8, 2019, View Source [SID1234535957]).

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The company also provided an update on the Phase 3 FIGHT trial testing bemarituzumab in combination with mFOLFOX6 in patients with gastric (GC) or gastroesophageal junction (GEJ) cancer that overexpresses FGFR2b.

"We and our partners have made steady progress advancing all five clinical programs in our pipeline, and we are swiftly responding to new information from the Phase 3 FIGHT trial," said Aron Knickerbocker, Chief Executive Officer of Five Prime Therapeutics. "In light of biomarker screening results from the FIGHT trial, we have made the decision to conduct an early futility analysis, which we expect to occur in the first half of 2020. We believe this is both clinically and fiscally responsible."

First Quarter 2019 Business Highlights and Milestones

Clinical Pipeline:

Bemarituzumab (FPA144) is a first-in-class isoform-selective antibody with enhanced antibody-dependent cell-mediated cytotoxicity (ADCC) in development as a targeted immunotherapy for tumors that overexpress FGFR2b.

Based on the FIGHT trial design, patients are being selected for enrollment by: (a) tissue IHC testing (FGFR2b protein overexpression), (b) blood ctDNA testing (FGFR2 gene amplification), or (c) both IHC and ctDNA testing, as data support that patients with tumors meeting criteria in any of the three biomarker categories may benefit from the addition of bemarituzumab to front-line chemotherapy.
The FIGHT trial marks the first time that FGFR2b protein overexpression has been measured on a large scale in front-line patients with advanced gastric and GEJ cancers. Greater than 30% of patients screened have tested positive for FGFR2b overexpression by IHC alone, which is significantly higher than expected. The company expected 10% of patients to test positive by either IHC and/or ctDNA tests in the FIGHT trial. Also, the company expected that patients who tested positive for FGFR2b overexpression by IHC alone would represent a minority of the patients enrolled in the FIGHT trial, but these patients represent the vast majority of biomarker positive patients in the FIGHT trial.
Because the composition of the enrolled patient population differs from the company’s expectations, Five Prime plans to conduct an early futility analysis.
FPA150 (anti-B7-H4) is a first-in-class anti-B7-H4 antibody designed to target tumor cells by blocking B7-H4 from sending an inhibitory signal to CD8 T cells and by enhancing killing of B7-H4 overexpressing tumors through ADCC. B7-H4 is frequently overexpressed in breast, ovarian and endometrial cancers.

The company initiated dosing in the Phase 1b monotherapy expansion portion of the Phase 1a/1b trial in February 2019. The company expects to initiate dosing in May 2019 in a safety lead-in evaluating FPA150 in combination with Keytruda (pembrolizumab) in patients with advanced ovarian cancer that overexpresses B7-H4.
The abstract titled "Phase 1a/1b study of first-in-class B7-H4 antibody, FPA150, as monotherapy in patients with advanced solid tumors" was accepted for a poster presentation at the 2019 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting. Preliminary safety data from the Phase 1a/1b trial will be presented.
Additional safety data along with preliminary efficacy data from the Phase 1b monotherapy expansion cohorts are expected to be presented at the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) 2019 Annual Congress.
FPT155 (CD80-Fc) is a first-in-class CD80-Fc fusion protein that uses the binding interactions of soluble CD80 to directly engage CD28 to enhance its co-stimulatory T cell activity without inducing super agonism and to block CTLA-4 from competing for endogenous CD80, allowing CD28 signaling to prevail in T cell activation in the tumor microenvironment.

The company presented preclinical data regarding FPT155 during the New Drugs on the Horizon Oral Session at the 2019 American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting.
The company expects to present data from the Phase 1a dose escalation portion of the ongoing Phase 1a/1b trial at the 34th Annual Meeting of the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) in November 2019.
Cabiralizumab (FPA008) is an antibody that inhibits CSF1R and has been shown to block the activation and survival of tumor-associated macrophages.

A Phase 2 trial testing the combination of cabiralizumab with Opdivo (nivolumab) with and without chemotherapy in approximately 160 patients with locally advanced or metastatic pancreatic cancer that has progressed during or after one line of chemotherapy is ongoing at sites in the U.S., Canada, Europe, Japan, Korea and Taiwan.
BMS-986258 (anti-TIM-3) is a fully-human monoclonal antibody targeting TIM-3 (T cell immunoglobulin and mucin domain-3), an immune checkpoint receptor that may limit the duration and magnitude of T cell responses. This is the first clinical candidate from the discovery collaboration between Five Prime and BMS that includes targets in three immune checkpoint pathways.

The Phase 1/2 clinical trial continues to progress.
Corporate Highlights

In January 2019, the company announced a corporate restructuring to focus resources on clinical development and late-stage research programs, primarily eliminating positions in research, pathology and manufacturing.
Summary of Financial Results and Guidance:

Cash Position: Cash, cash equivalents and marketable securities totaled $237.0 million as of March 31, 2019, compared to $270.1 million as of December 31, 2018. The decrease in cash, cash equivalents and marketable securities was primarily attributed to quarterly operating expenses that exceeded quarterly revenues.

Revenue: Collaboration and license revenue for the first quarter of 2019 decreased by $27.1 million, or 84%, to $5.3 million from $32.5 million for the first quarter of 2018. This decrease was primarily related to the $25.0 million milestone earned in the first quarter of 2018 relating to the dosing of the first patient in the BMS Phase 2 clinical trial of cabiralizumab in combination with Opdivo with and without chemotherapy.

R&D Expenses: Research and development expenses for the first quarter of 2019 decreased by $11.8 million, or 27%, to $31.8 million from $43.6 million for first quarter of 2018. This decrease was primarily related to companion diagnostic expense incurred in the first quarter of 2018, with no corresponding expense in the first quarter of 2019 and lower compensation costs, and lower clinical trial expenses that were partially offset by higher manufacturing costs related to the FPA150 program.

G&A Expenses: General and administrative expenses for both the first quarters of 2019 and 2018 were $10.5 million.

Net Loss: Net loss for the first quarter of 2019 was $35.4 million, or ($1.02) per basic and diluted share, compared to a net loss of $20.4 million, or ($0.63) per basic and diluted share, for the first quarter of 2018.

Shares Outstanding: Total shares outstanding were 34,838,684 as of March 31, 2019.

Cash Guidance: Five Prime expects full-year 2019 net cash used in operating activities to be between $117 and $122 million and estimates ending 2019 with cash, cash equivalents and marketable securities between $148 and $153 million.

Conference Call Information

Five Prime will host a conference call and live audio webcast today at 4:30 p.m. (ET) / 1:30 p.m. (PT) to discuss its financial results and provide a corporate update. To participate in the conference call, please dial (877) 878-2269 (domestic) or (253) 237-1188 (international) and refer to conference ID 9689855. To access the live webcast please visit the "Events & Presentations" page under the "Investors" tab on Five Prime’s website at www.fiveprime.com. An archived copy of the webcast will be available on Five Prime’s website beginning approximately two hours after the conference call. Five Prime will maintain an archived replay of the webcast on its website for at least 30 days after the conference call.

About the FIGHT Trial

The Phase 3 FIGHT (FGFR2b Inhibition in Gastric and Gastroesophageal Junction Cancer Treatment) trial is a double-blind randomized and controlled study evaluating 15 mg/kg of bemarituzumab or placebo given every two weeks combined with modified FOLFOX6 (mFOLFOX6) chemotherapy in patients with GC or GEJ cancer whose tumors overexpress FGFR2b. The primary endpoint is overall survival (OS), with key secondary endpoints being progression-free survival (PFS), objective response rate (ORR), safety and pharmacokinetic (PK) parameters.

The Phase 3 FIGHT trial is the first prospective FGFR2b-specific front-line gastric study that is evaluating bemarituzumab and mFOLFOX6 in advanced GC and GEJ cancer across clinical trial sites in Asia, the US, and Europe. Zai Lab and Five Prime have a strategic development collaboration under which Zai Lab will manage the Phase 3 portion of the FIGHT trial in China.

Unmet Need in Gastric Cancer (GC) and Gastroesophageal Junction (GEJ) cancer

Gastric cancer, including GEJ cancer, is the fifth most common cancer worldwide and third leading cause of cancer death. Gastric cancer is the second most common cancer in China.

Current first-line chemotherapy treatment delays progression by approximately six months compared to best supportive care, but median OS remains poor with literature-reported ranges of approximately 10 to 11 months and PFS of approximately six months. The presence of FGFR2b overexpression is present in patients with GC/GEJ and is associated with a worse prognosis. Few treatment options following progression are available after first-line chemotherapy, and a significant unmet need remains in the treatment of GC/GEJ worldwide.

Five Prime has partnered with two companion diagnostics companies to identify FGFR2b overexpression using an immunohistochemistry (IHC) test and FGFR2 gene amplification using circulating tumor DNA (ctDNA) analysis. Five Prime is using both assays to select patients for the FIGHT trial.

About Bemarituzumab

Bemarituzumab is a first-in-class, isoform-selective, humanized monoclonal antibody in clinical development as a targeted immunotherapy for tumors that overexpress FGFR2b, a splice variant of a receptor for some members of the fibroblast growth factor (FGF) family. Bemarituzumab blocks FGFs 7, 10 and 22 from binding to FGFR2b, and has been engineered for enhanced antibody-dependent cell-mediated cytotoxicity (ADCC) to increase direct tumor cell killing by recruiting natural killer (NK) cells. Clinical results to date suggest that the specificity of bemarituzumab avoids the dose-limiting toxicities that have been seen with less selective pan-FGFR tyrosine kinase inhibitors that act on multiple FGFRs, including FGFR2.