On January 31, 2019 Repare Therapeutics, Inc., a privately held precision oncology company pioneering synthetic lethality to develop novel therapeutics that target specific vulnerabilities of tumors in clearly defined patient populations, reported that it has entered into an exclusive strategic research, development and commercialization partnership with ONO Pharmaceutical Co., Ltd., for Repare’s small molecule Polθ inhibitor program in Japan, South Korea, Taiwan, Hong Kong, Macau and ASEAN countries, excluding mainland China. Repare retains all rights to develop and commercialize the products outside the ONO territory, including the US, Canada and EU.

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"We’re excited to have ONO as a discovery and development partner," said Lloyd M. Segal, President and CEO of Repare. "This relationship will support our drive to and through the clinic in this important new area of precision oncology therapeutic development."

"ONO identified Repare Therapeutics as the partner of choice for bringing in a potential first-in-class and best-in-class Polθ inhibitor to our portfolio," said Gyo Sagara, President, Representative Director and CEO of ONO. "We are excited to work with Repare for the benefit of cancer patients."

Under the terms of the agreement, ONO will provide an up-front payment and research service payments potentially totaling US $15M, plus additional cost-sharing through IND. Beyond IND, significant clinical, regulatory and commercial milestones are also included in the agreement, with a potential total of US $160M. ONO will also pay to Repare high single-digit to low double-digit tiered royalties based on net sales of the products. Repare retains all rights to develop and commercialize the products outside the ONO territory, including the US, Canada and the EU.

Polθ inhibitor opportunity

DNA Polymerase θ (Polθ) is a unique, multifunctional DNA polymerase essential to repairing DNA breaks, especially in homologous recombination deficient (HRD) cells. HRD, including deficiency in the BRCA1 and BRCA2 genes, is a clinically important feature across a variety of important tumor types, including breast, ovarian, prostate and pancreatic cancers. Polθ gene expression is low in normal cells but elevated across a broad range of tumor types, including those with HRD. Currently, HRD tumors may be treated with Poly(ADP-ribose) Polymerase (PARP) inhibitors, which represent a rapidly growing, multi-billion dollar global market. A significant fraction of patients does not initially respond to PARP inhibitor treatment, and the vast majority of treated patients eventually develop PARP inhibitor resistance. A Polθ inhibitor has potential as both a mono-therapy across multiple tumor types and in combination with PARP inhibitors, where its distinct mechanism of action may help address both forms of PARP resistance. Additional clinical populations may also be attractive for combination treatment with a Polθ inhibitor, including possible combinations with chemotherapy, radiotherapy and Immuno-Oncology agents.

On January 30, 2019, Pieris Pharmaceuticals, Inc. (the "Company") and Biotechnology Value Fund, L.P., Biotechnology Value Fund II, L.P., and Biotechnology Value Trading Fund OS, L.P. (collectively, "BVF") reported that it has entered into an Exchange Agreement (the "Exchange Agreement") pursuant to which BVF agreed to exchange (the "Exchange") an aggregate of 5,000,000 shares of the Company’s common stock, par value $0.001 ("Common Stock"), owned by BVF for an aggregate of 5,000 shares of the Company’s newly-designated Series B Convertible Preferred Stock, par value $0.001 per share ("Series B Preferred Stock"). The Exchange closed on February 1, 2019 (Filing, 8-K, Pieris Pharmaceuticals, JAN 30, 2019, View Source [SID1234533049]).

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As described below, the Series B Preferred Stock has substantially the same terms as the Company’s Series A Convertible Preferred Stock, par value $0.001 per share ("Series A Preferred Stock"), issued in June 2016 and currently held by entities affiliated with BVF. The shares of Series B Preferred Stock issued in the Exchange are convertible into an aggregate of 5,000,000 shares of Common Stock (subject to adjustment as provided in the Series B Certificate of Designation, as defined below), subject to a 9.99% beneficial ownership blocker provision described below.
As of the date of the Exchange Agreement, BVF represented to the Company that it beneficially owned 7,457,921 shares of Common Stock, representing approximately 13.77% of the shares of Common Stock outstanding as of such date. In addition, BVF holds 2,907 shares of Series A Preferred Stock, which are convertible into 2,907,000 shares of Common Stock (subject to adjustment as provided in the Certificate of Designation of Series A Convertible Preferred Stock of Pieris Pharmaceuticals, Inc. (the "Series A Certificate of Designation")), subject to a 9.99% beneficial ownership blocker provision set forth in the Series A Certificate of Designation.
A copy of the Exchange Agreement is attached hereto as Exhibit 10.1 and is incorporated herein by reference. The foregoing is only a brief description of the material terms of the Exchange Agreement, does not purport to be complete and is qualified in its entirety by reference to the full text of the Exchange Agreement. The representations, warranties and covenants made by the Company in the Exchange Agreement were made solely for the benefit of the parties to the Exchange Agreement, including, in some cases, for the purpose of allocating risk among the parties thereto, and should not be deemed to be a representation, warranty or covenant to investors. Moreover, such representations, warranties or covenants were made as of January 30, 2019. Accordingly, such representations, warranties and covenants should not be relied on as accurately representing the current state of the Company’s affairs.

On January 30, 2019 Thermo Fisher Scientific Inc. (NYSE: TMO), the world leader in serving science, reported its financial results for the fourth quarter and full year ended December 31, 2018 (Press release, Thermo Fisher Scientific, JAN 30, 2019, View Source [SID1234532983]).

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Fourth Quarter and Full Year 2018 Highlights

Fourth quarter revenue grew 8% to $6.51 billion.
Fourth quarter GAAP diluted earnings per share (EPS) increased 71% to $2.22.
Fourth quarter adjusted EPS increased 16% to $3.25.
Full year revenue grew 16% to $24.36 billion.
Full year GAAP diluted EPS increased 30% to $7.24.
Full year adjusted EPS increased 17% to $11.12.
Invested $1 billion in R&D in 2018 and launched a range of new products that strengthened our leading offering, including the Thermo Scientific Vanquish Duo UHPLC system, Thermo Scientific Q Exactive UHMR mass spectrometer, Ion GeneStudio S5 Series next-generation sequencing systems and the Phadia 200 allergy and autoimmune instrument in Europe.
Built on the excellent growth momentum we had all year in Asia-Pacific and Emerging Markets, capped by another very strong quarter in China, where we recently opened our first Bioprocess Design Center to support development of biologics.
Continued to successfully execute our capital deployment strategy in 2018 to create significant shareholder value – reducing debt by $2.0 billion, closing $540 million of bolt-on acquisitions and returning capital through $500 million of stock buybacks and $275 million of dividends.
Adjusted EPS, adjusted operating income, adjusted operating margin and free cash flow are non-GAAP measures that exclude certain items detailed later in this press release under the heading "Use of Non-GAAP Financial Measures."

"I’m pleased to report that we had a very strong finish to the year," said Marc N. Casper, president and chief executive officer of Thermo Fisher Scientific. "Our outstanding performance in 2018 is testament to the success of our growth strategy and great execution by our team.

"In line with our strategy, we continued to innovate to enable our customers’ scientific advances, leveraged our scale in Asia-Pacific and emerging markets to drive growth, and enhanced our customer value proposition with the smooth integration of Patheon. At the same time, we significantly strengthened our balance sheet and effectively deployed our capital by investing in strategic M&A and returning capital to our shareholders."

Casper concluded, "All in all, it was a fantastic year, which puts us in a great position as we begin 2019."

Fourth Quarter 2018

Revenue for the quarter grew 8% to $6.51 billion in 2018, versus $6.05 billion in 2017. Organic revenue growth was 8%; acquisitions increased revenue by 1% and currency translation decreased revenue by 2%. The components of revenue growth do not sum due to rounding.

GAAP Earnings Results
GAAP diluted EPS in the fourth quarter increased 71% to $2.22, versus $1.30 in the same quarter last year. Results in 2017 included a one-time tax provision associated with U.S. tax reform. GAAP operating income for the fourth quarter of 2018 grew to $1.15 billion, compared with $0.96 billion in the fourth quarter of 2017. GAAP operating margin increased to 17.6%, compared with 15.8% in the fourth quarter of 2017.

Non-GAAP Earnings Results
Adjusted EPS in the fourth quarter of 2018 increased 16% to $3.25, versus $2.79 in the fourth quarter of 2017. Adjusted operating income for the fourth quarter of 2018 grew 12% compared with the year-ago quarter. Adjusted operating margin increased 90 basis points to 24.8%, compared with 23.9% in the fourth quarter of 2017.

Full Year 2018

Revenue for the full year grew 16% to $24.36 billion in 2018, versus $20.92 billion in 2017. Organic revenue growth was 8%; acquisitions increased revenue by 7% and currency translation increased revenue by 1%.

GAAP Earnings Results
GAAP diluted EPS for the full year increased 30% to $7.24, versus $5.59 in 2017. Results in 2017 reflect the one-time tax provision noted above. GAAP operating income for 2018 grew to $3.78 billion, compared with $2.96 billion a year ago. GAAP operating margin was 15.5% in 2018, compared with 14.2% in 2017.

Non-GAAP Earnings Results
Adjusted EPS for the full year rose 17% to $11.12, versus $9.49 in 2017. Adjusted operating income for 2018 grew 16% compared with 2017, and adjusted operating margin was 23.1%, compared with 23.2% a year ago.

Annual Guidance for 2019

The company will provide 2019 financial guidance on its earnings conference call this morning at 8:30 a.m. Eastern time.

Segment Results

Management uses adjusted operating results to monitor and evaluate performance of the company’s four business segments, as highlighted below. Since these results are used for this purpose, they are also considered to be prepared in accordance with GAAP.

Life Sciences Solutions Segment

In the fourth quarter of 2018, Life Sciences Solutions Segment revenue grew 8% to $1.70 billion, compared with revenue of $1.58 billion in the fourth quarter of 2017. Segment adjusted operating margin increased to 36.8%, versus 35.5% in the 2017 quarter.

For the full year 2018, Life Sciences Solutions Segment revenue rose 9% to $6.27 billion, compared with revenue of $5.73 billion in 2017. Segment adjusted operating margin increased to 34.4% in 2018, compared with 33.1% a year ago.

Analytical Instruments Segment

Analytical Instruments Segment revenue grew 11% to $1.57 billion in the fourth quarter of 2018, compared with revenue of $1.41 billion in the fourth quarter of 2017. Segment adjusted operating margin increased to 26.6%, versus 24.5% in the 2017 quarter.

For the full year 2018, Analytical Instruments Segment revenue rose 13% to $5.47 billion, compared with revenue of $4.82 billion in 2017. Segment adjusted operating margin grew to 22.8%, versus 21.3% in 2017.

Specialty Diagnostics Segment

In the fourth quarter of 2018, Specialty Diagnostics Segment revenue grew 4% to $0.95 billion, compared with revenue of $0.91 billion in the fourth quarter of 2017. Segment adjusted operating margin was 24.5%, versus 26.4% in the 2017 quarter.

For the full year 2018, Specialty Diagnostics Segment revenue grew 7% to $3.72 billion, compared with revenue of $3.49 billion in 2017. Segment adjusted operating margin was 25.6%, versus 2017 results of 26.6%.

Laboratory Products and Services Segment

Laboratory Products and Services Segment revenue grew 8% to $2.60 billion in the fourth quarter of 2018, compared with revenue of $2.40 billion in the fourth quarter of 2017. Segment adjusted operating margin increased to 13.1%, versus 12.5% in the 2017 quarter.

For the full year 2018, Laboratory Products and Services Segment revenue grew 28% to $10.04 billion, compared with revenue of $7.83 billion in 2017. Segment adjusted operating margin was 12.5%, versus 12.8% in 2017.

Use of Non-GAAP Financial Measures

In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), we use certain non-GAAP financial measures, including adjusted EPS, adjusted operating income and adjusted operating margin, which exclude certain acquisition-related costs, including charges for the sale of inventories revalued at the date of acquisition and significant transaction costs; restructuring and other costs/income; and amortization of acquisition-related intangible assets. Adjusted EPS also excludes certain other gains and losses that are either isolated or cannot be expected to occur again with any predictability, tax provisions/benefits related to the previous items, benefits from tax credit carryforwards, the impact of significant tax audits or events and the results of discontinued operations. We exclude the above items because they are outside of our normal operations and/or, in certain cases, are difficult to forecast accurately for future periods. We also use a non-GAAP measure, free cash flow, which is operating cash flow, excluding net capital expenditures, and also excludes operating cash flows from discontinued operations to provide a view of the continuing operations’ ability to generate cash for use in acquisitions and other investing and financing activities. We believe that the use of non-GAAP measures helps investors to gain a better understanding of our core operating results and future prospects, consistent with how management measures and forecasts the company’s performance, especially when comparing such results to previous periods or forecasts.

For example:

We exclude costs and tax effects associated with restructuring activities, such as reducing overhead and consolidating facilities. We believe that the costs related to these restructuring activities are not indicative of our normal operating costs.

We exclude certain acquisition-related costs, including charges for the sale of inventories revalued at the date of acquisition and significant transaction costs. We exclude these costs because we do not believe they are indicative of our normal operating costs.

We exclude the expense and tax effects associated with the amortization of acquisition-related intangible assets because a significant portion of the purchase price for acquisitions may be allocated to intangible assets that have lives of 3 to 20 years. In 2019, based on acquisitions closed through the end of 2018, our adjusted EPS will exclude approximately $3.27 of expense for the amortization of acquisition-related intangible assets. Exclusion of the amortization expense allows comparisons of operating results that are consistent over time for both our newly acquired and long-held businesses and with both acquisitive and non-acquisitive peer companies.

We also exclude certain gains/losses and related tax effects, benefits from tax credit carryforwards and the impact of significant tax audits or events (such as the effect on deferred tax balances of enacted changes in tax rates or, in 2017, the incremental impact of tax reform legislation in the U.S.), which are either isolated or cannot be expected to occur again with any predictability and that we believe are not indicative of our normal operating gains and losses. For example, we exclude gains/losses from items such as the sale of a business or real estate, gains or losses on significant litigation-related matters, gains on curtailments of pension plans, the early retirement of debt and discontinued operations.

We also report free cash flow, which is operating cash flow, excluding net capital expenditures, and also excludes operating cash flows from discontinued operations to provide a view of the continuing operations’ ability to generate cash for use in acquisitions and other investing and financing activities.

Thermo Fisher’s management uses these non-GAAP measures, in addition to GAAP financial measures, as the basis for measuring the company’s core operating performance and comparing such performance to that of prior periods and to the performance of our competitors. Such measures are also used by management in their financial and operating decision-making and for compensation purposes.

The non-GAAP financial measures of Thermo Fisher’s results of operations and cash flows included in this press release are not meant to be considered superior to or a substitute for Thermo Fisher’s results of operations prepared in accordance with GAAP. Reconciliations of such non-GAAP financial measures to the most directly comparable GAAP financial measures are set forth in the accompanying tables. Thermo Fisher does not provide GAAP financial measures on a forward-looking basis because we are unable to predict with reasonable certainty and without unreasonable effort items such as the timing and amount of future restructuring actions and acquisition-related charges as well as gains or losses from sales of real estate and businesses, the early retirement of debt and the outcome of legal proceedings. The timing and amount of these items are uncertain and could be material to Thermo Fisher’s results computed in accordance with GAAP.

Conference Call

Thermo Fisher Scientific will hold its earnings conference call today, January 30, 2019, at 8:30 a.m. Eastern time. To listen, dial 877-273-7122 within the U.S. or 647-689-5496 outside the U.S. You may also listen to the call live on our website, www.thermofisher.com, by clicking on "Investors." You will find this press release, including the accompanying reconciliation of non-GAAP financial measures and related information, in that section of our website under "Financial Results." An audio archive of the call will be available under "Webcasts and Presentations" through Friday, February 8, 2019.

On January 30, 2019 BioTime, Inc. (NYSE American: BTX), a clinical-stage biotechnology company focused on degenerative diseases, reported that its affiliate company, OncoCyte Corporation (OncoCyte) (OCX), a developer of novel, non-invasive tests for the early detection of cancer, has reported positive results from an R&D validation study of DetermaVu, a non-invasive, liquid biopsy test intended to facilitate clinical decision making in lung cancer diagnosis (Press release, BioTime, JAN 30, 2019, View Source;p=RssLanding&cat=news&id=2385346 [SID1234532977]). As outlined in OncoCyte’s announcement, the R&D validation study demonstrated a sensitivity of 90% (95% CI 82%-95%) and specificity of 75% (95% CI 68%-81%) of DetermaVu on a prospectively collected cohort of 250 patient blood samples that were blinded to laboratory operators. A 95% confidence interval (CI) suggests that there is a 95% chance that test performance will be within the stated range.

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According to OncoCyte, these results indicate that DetermaVu significantly exceeds the critical parameters necessary for use in lung cancer diagnosis and clearly outperforms reported results from competitors’ tests and other clinical models. OncoCyte believes that the potential U.S. market opportunity for DetermaVu is $4.7 billion. OncoCyte intends to make DetermaVu commercially available in the second half of 2019.

"As the largest shareholder of OncoCyte, we wish to congratulate the entire team on obtaining positive results from the validation study of DetermaVu which were announced yesterday morning," stated Brian M. Culley, Chief Executive Officer of BioTime, Inc. "BioTime owns approximately 36% of Oncocyte’s outstanding common stock and we look forward to the commercial launch of DetermaVu which OncoCyte expects to occur later this year."

DetermaVu is OncoCyte’s confirmatory, non-invasive, liquid biopsy test intended to facilitate clinical decision making in lung cancer diagnosis. DetermaVu is being developed as a confirmatory test for presence or absence of lung cancer to reduce the need for unnecessary invasive biopsies when suspicious lung nodules are detected by imaging modalities such as x-rays or other scans. DetermaVu is a trademark of OncoCyte Corporation.

On January 30, 2019 Can-Fite BioPharma Ltd. (NYSE American: CANF) (TASE:CFBI), a biotechnology company advancing a pipeline of proprietary small molecule drugs that address cancer, liver and inflammatory diseases, reported that Drug Design, Development and Therapy has published an article titled, "Targeting the A3 Adenosine Receptor to Treat Cytokine Release Syndrome in Cancer Immunotherapy (Press release, Can-Fite BioPharma, JAN 30, 2019, View Source [SID1234532976])." The article presents data from numerous studies that show adenosine’s role in inhibiting inflammatory cytokine production. Can-Fite’s Piclidenoson, a Phase III drug candidate, and Namodenson, a Phase II drug candidate, both target the A3 adenosine receptor (A3AR), which the Company believes may treat cytokine release syndrome (CRS) while also promoting an anti-cancer effect.

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CRS is a potentially life threatening side effect of cancer immunotherapies including CAR-T. The market for CAR-T drugs is estimated to reach approximately $5.4 Billion in 2024 according to Evaluate Pharma.

"While CAR-T and other cancer immunotherapies are saving lives, as their use increases, there is growing concern about the drugs’ life threatening side effects including the high incidence of CRS. With the publication of this article in Drug Design, Development and Therapy, we are advancing the scientific community towards delivering immunotherapies that offer a high degree of efficacy with a greater degree of safety for the patient. Our platform technology, through Namodenoson, has already displayed its anti-cancer effects in humans, and therefore it is a candidate to not only protect patients from CRS, but to also boost the body’s fight against cancer," stated Dr. Pnina Fishman, Can-Fite’s CEO. "We look forward to implementing our development strategy for our drugs in the treatment of CRS."

Can Fite’s platform technology selectively targets A3AR, which plays a central role in mediating the mechanism of inflammation by reducing elevated levels of pro-inflammatory cytokines such as IL-6, IL-1β, NF-Kβ, TNF-α, and more.