On February 5, 2020 The University of Texas MD Anderson Cancer Center reported that results from a Phase I/IIa trial treatment with cord blood-derived chimeric antigen receptor (CAR) natural killer (NK)-cell therapy targeting CD19 resulted in clinical responses in a majority of patients with relapsed or refractory non-Hodgkin’s lymphoma (NHL) and chronic lymphocytic leukemia (CLL), with no major toxicities observed (Press release, MD Anderson, FEB 5, 2020, View Source [SID1234553885]).

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The trial results were published today in the New England Journal of Medicine. Of the 11 patients participating in the study, eight (73%) responded to therapy and seven of those achieved a complete response, meaning they no longer showed evidence of disease at a median follow-up of 13.8 months. Post-remission therapy was administered to five of the responding patients. No patients experienced cytokine release syndrome or neurotoxicity.

Responses to the CD19 CAR NK cell therapy were evident within one month following infusion, and persistence of these cells was confirmed out to one year post-infusion.

"We are encouraged by the results of the clinical trial, which will launch further clinical studies to investigate allogeneic cord blood-derived CAR NK cells as a potential treatment option for patients in need," said corresponding author Katy Rezvani, M.D., Ph.D., professor of Stem Cell Transplantation & Cellular Therapy.

Rezvani led the development of MD Anderson’s CAR NK platform with the support of the adoptive cell therapy (ACT) platform, Chronic Lymphocytic Leukemia Moon Shot and B-Cell Lymphoma Moon Shot, all part of the institution’s Moon Shots Program, a collaborative effort to rapidly develop scientific discoveries into meaningful clinical advances that save patients’ lives.

CAR NK cells are allogeneic, meaning the cells are taken from a non-related healthy donor rather than the patient themselves. Thus, CAR NK cells have the potential to be manufactured in advance and stored for off-the-shelf immediate use. In contrast, currently commercially available CAR T cells require the use of a patient’s own genetically modified T cells, created through a multi-week manufacturing process.

At MD Anderson, NK cells are isolated from donated umbilical cord blood and genetically engineered to express the desired CAR, which recognizes cancer-specific targets. The CAR NK cells also are ‘armored’ with IL-15, an immune signaling molecule that is designed to enhance proliferation and survival of the cells. The CD19 CAR NK cells used in this study were designed to target B-cell malignancies.

On the clinical trial, 11 patients received a single dose of cord blood-derived CD19 CAR NK cells, administered at one of three dose levels. Five patients had CLL and six had NHL. All patients were treated with a minimum of three and maximum of 11 lines of prior therapy. The first nine patients treated received CD19 CAR NK cells that were partially matched according to the individual’s human leukocyte antigen (HLA) type, but the protocol allowed the final two patients to be treated with no HLA matching.

Side effects experienced by participants were primarily related to the conditioning chemotherapy given before cell infusion and were resolved within one to two weeks, said Rezvani. No patient required admission to an intensive care unit for management of treatment side effects.

"Due to the nature of the therapy, we’ve actually been able to administer it in an outpatient setting," said Rezvani. "We look forward to building upon these results in larger multi-center trials as we work with Takeda to make this therapy available more broadly."

MD Anderson’s CAR NK cell therapy platform was licensed to Takeda Pharmaceutical Company Limited in 2019. As part of the license agreement and research agreement, Takeda has exclusive rights to develop and commercialize up to four CAR NK programs, including the CD19 CAR NK cell therapy (TAK-007) and B-cell maturation antigen (BCMA)-targeted CAR NK cells.

With continued support from the ACT platform, the Department of Lymphoma and Myeloma, and MD Anderson’s Therapeutics Discovery division, Takeda and MD Anderson are collaborating to initiate a pivotal clinical trial for the CD19 CAR NK-cell therapy TAK-007 in 2021. MD Anderson will implement an Institutional Conflict of Interest Management and Monitoring Plan for this research.

On February 5, 2020 Merck (NYSE: MRK), known as MSD outside the United States and Canada, reported its intention to spin-off products from its Women’s Health, trusted Legacy Brands, and Biosimilars businesses into a new, yet-to-be-named, independent, publicly traded company (Press release, Merck & Co, FEB 5, 2020, View Source [SID1234553878]). The spinoff will allow both management teams to drive increased responsiveness to the particular needs of their patients and customers and achieve faster growth through focused and fit-for-purpose operating models.

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Merck will continue to benefit from strong growth across its current key pillars of Oncology, Vaccines, Hospital and Animal Health, while remaining fully committed to investing in research and development in pursuit of breakthrough innovations across all areas of science and to driving value from its deep late-stage pipeline. As a premier research-intensive biopharmaceutical company, Merck will continue its pursuit to advance the prevention and treatment of diseases that threaten people and communities around the world.

"Over the past several years, we have purposefully shifted the focus of our efforts and resources to our best opportunities for growth," said Kenneth C. Frazier, chairman and chief executive officer, Merck. "This has led to the exceptional results we are reporting today. Given the opportunities now in front of us, we believe we can benefit from even greater focus. At the same time, we believe additional resources and focus will help ensure that our expansive portfolio, including many trusted and medically important products, reach their full potential. We have therefore made the decision to separate into two growth companies: Merck and NewCo. By optimizing our human health portfolio, Merck can move closer to its aspiration of being the premier research-intensive biopharmaceutical company, while also properly prioritizing a set of products at NewCo that are important to public health and the patients who rely on them, and which present real opportunities for growth."

SPINOFF CREATES TWO INDEPENDENT GROWTH COMPANIES

Compelling Strategic Rationale for Spinoff

Merck believes the spinoff will deliver significant benefits for both Merck and NewCo and create value for Merck shareholders. The transaction is expected to create two companies with:

Enhanced strategic and operational focus on key drivers to accelerate growth,
Improved agility to anticipate and respond to customer needs and rapidly evolving market dynamics,
Simplified operating models with reduced complexity and improved efficiencies,
Optimized capital structures and resource allocation to pursue their distinct strategic agendas for long-term success and deliver greater returns to shareholders, and
Improved financial profiles making for unique and compelling investment cases.
Merck to Retain its Portfolio of Key Growth Drivers in Oncology, Vaccines, Hospital and Animal Health

Merck will retain its current growth pillars of Oncology, Vaccines, Hospital and Animal Health and continue to invest in research and development of breakthrough innovations across all areas of science. Led by highly innovative products, including KEYTRUDA (pembrolizumab), Lynparza (olaparib), Lenvima (lenvatinib mesylate), GARDASIL (Human Papillomavirus Vaccine, Recombinant), BRIDION (sugammadex), ZERBAXA (ceftolozane and tazobactam), and BRAVECTO (fluralaner), as well as its leading diabetes business and other key products, Merck will continue to benefit from broad commercial scale and remains committed to ensuring continued access to its innovative medicines across the globe.

The spinoff of NewCo will reduce Merck’s Human Health manufacturing footprint by approximately 25% and the number of Human Health products it manufactures and markets by approximately 50%. This will allow for a more focused operating model in support of its growth products. As a result, Merck expects to optimize its resources, grow faster and achieve meaningful operating margin expansion over time through increased productivity and efficiency.

NewCo to be Comprised of Products from Merck’s Women’s Health, Trusted and Medically Important Legacy Brands and Biosimilars Businesses

NewCo will pursue global leadership and focused, sustainable growth in Women’s Health led by the growing and patent-protected NEXPLANON (etonogestrel implant) franchise and fueled by its leading contraceptive and fertility businesses. NewCo expects to establish a leading position in Biosimilars along with its partner, Samsung Bioepis Co., Ltd., focusing on its current portfolio including RENFLEXIS (infliximab-abda) and BRENZYS (etanercept) in immunology and ONTRUZANT (trastuzumab-dttb) in oncology, and is well-positioned to be a partner in the commercialization of biosimilars worldwide. NewCo will have a large portfolio of highly profitable and trusted brands consisting of dermatology, pain, respiratory, select cardiovascular products including ZETIA (ezetimibe) and VYTORIN (ezetimibe/simvastatin), as well as the rest of Merck’s Diversified Brands, with strong cash flows that will support investments in future growth opportunities. In addition, NewCo will pursue opportunities to partner with biopharmaceutical innovators looking to commercialize their products by leveraging NewCo’s scale and presence in fast growing international markets.

NewCo will have a global footprint with approximately 75% of sales generated from ex-U.S. markets, significant scale and geographic reach, world-class commercial capabilities, and approximately 10,000 to 11,000 employees. NewCo is expected to be headquartered in New Jersey.

FINANCIAL OUTLOOK

Merck Targeting 40%+ Operating Margins by 2024; Believes Revenue Potential is Underappreciated; Retaining Current Dividend

Merck expects strong revenue growth each year through 2024, which will accelerate as a result of the spinoff.

Merck continues to expect meaningful operating margin expansion over time. The spinoff of NewCo should enable Merck to achieve incremental operating efficiencies in excess of $1.5 billion by 2024, while continuing to increase investment in key growth drivers and pipeline assets. Merck is therefore targeting Non-GAAP operating margins greater than 40% in 2024, higher than what Merck expected to achieve pre-spinoff.

Merck expects to receive $8 billion to $9 billion through a special tax-free dividend from NewCo. Merck expects that these funds will be allocated to business development or share repurchases and will provide more details about the planned usage of these funds closer to the spinoff date.

Merck will retain its current 2020 dividend of $2.44 per share and anticipates future increases with the goal of achieving a 47% to 50% payout ratio over time.

Combined Value Creation

Shareholders holding both Merck and NewCo post spinoff are expected to benefit from increased combined non-GAAP (generally accepted accounting principles) earnings per share assuming dilution (EPS) over time, as well as higher combined dividends. The combined non-GAAP EPS of the two companies is expected to be nominally lower initially than what Merck would have achieved pre-spinoff, reflecting costs necessary to operate NewCo as an independent company. However, as a result of the incremental growth that NewCo is expected to achieve, combined with the benefit of ongoing operating efficiencies at Merck enabled by the spinoff, the company expects Merck and NewCo to realize higher combined non-GAAP EPS within 12 to 24 months post-spinoff.

NewCo Expects to Achieve Strong Profitability and Low-Single-Digit Revenue Growth from 2021 Base; Expects to Pay Incremental Dividend

The products to be spun off into NewCo are expected to generate 2020 revenue of approximately $6.5 billion within Merck, with a non-GAAP operating margin of approximately 45%. As an independent company from a 2021 base-year of approximately $6.0 billion to $6.5 billion in revenue, NewCo is expected to achieve low-single-digit revenue growth. Inclusive of costs necessary in standing up NewCo as an independent company, non-GAAP operating margins are expected to be in the mid-30% range in the first year post separation and increase over time. NewCo’s earnings before interest, taxes, depreciation, and amortization (EBITDA) margins are expected to be in the low-to-mid 40% range in the first year post separation and increase over time.

NewCo is expected to have $8.5 billion to $9.5 billion in initial debt, with substantial cash flow that will provide ample financial flexibility for potential business development, debt paydown and a meaningful dividend. This expected dividend will be entirely incremental to Merck’s dividend.

LEADERSHIP AND GOVERNANCE

NewCo to be Led by Experienced Pharmaceutical Executives

Kevin Ali, who brings three decades of pharmaceutical commercial experience from within Merck, will be named chief executive officer of NewCo. Ali has led Merck’s enterprise portfolio strategy initiative, reporting to Frazier, for the past year. Prior to this, Ali served in many leadership roles within Merck, including president, MSD International; president, Emerging Markets; senior vice president in charge of the Bone, Respiratory, Immunology and Dermatology franchise; managing director of Germany and managing director of Turkey.

"Built on the foundation of a trusted, high-quality portfolio, NewCo will help people around the world live healthier lives, with a special focus on investing in innovations for the distinct healthcare needs of women," Ali said. "We are committed to becoming a leader in Women’s Health driven by organic and inorganic opportunities fueled by our portfolio of trusted legacy brands and our commitment to growing our rapidly expanding biosimilars business."

Carrie Cox will be named NewCo’s Chairman of the Board of Directors. Cox has extensive experience in the pharmaceutical industry and deep expertise in women’s health, formerly serving as chairman of Array BioPharma Inc., CEO and chairman of Humacyte Inc., president of Global Pharmaceuticals at Schering-Plough Corporation (acquired by Merck in 2009), executive vice president of Pharmacia Corporation and vice president of Women’s Health Care at Wyeth-Ayerst Laboratories, Inc.

"I am delighted to be joining the leadership of NewCo and excited by the growth opportunities in its portfolio," Cox said. "The time has come for a company dedicated to serving the healthcare needs of women, in addition to a broad portfolio that continues to be important for the public health needs of patients around the world."

More information about NewCo Board, governance structure and management team will be provided in the future.

Transaction Intended to be Completed in the First Half of 2021

The transaction is intended to take the form of a tax-free distribution to Merck shareholders of a new publicly traded stock in NewCo. The spinoff is expected to be completed in the first half of 2021, subject to market and certain other conditions.

Conference Call

Merck will discuss this transaction on its previously scheduled earnings conference call today, Feb. 5, at 8:00 a.m. EST, which investors, journalists and the general public may access via a live audio webcast on Merck’s website at View Source Institutional investors and analysts can participate in the call by dialing (706) 758-9927 or (877) 381-5782 and using ID code number 8583879. Members of the media are invited to listen to the call by dialing (706) 758-9928 or (800) 399-7917 and using ID code number 8583879. Journalists who wish to ask questions are requested to contact a member of Merck’s Media Relations team at the conclusion of the call.

On February 5, 2020 Bellicum Pharmaceuticals, Inc. (Nasdaq: BLCM) ("Bellicum" or the "Company"), a leader in developing novel, controllable cellular immunotherapies for cancers, reported that the Company effected a reverse stock split of its issued and outstanding common stock, at a ratio of 1-for-10 (Press release, Bellicum Pharmaceuticals, FEB 5, 2020, View Source [SID1234553875]). The effective time of the reverse stock split will be 5 p.m. ET on February 5, 2020. The Company’s common stock will begin trading on a split-adjusted basis commencing upon market open on February 6, 2020.

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As previously disclosed, at a special meeting of stockholders held on January 15, 2020, the Company’s stockholders voted to approve a proposal authorizing the Board of Directors of the Company to amend the Company’s certificate of incorporation to effect a reverse stock split and a corresponding reduction in the authorized shares of the Company’s common stock. On January 27, 2020, the Board of Directors approved a 1-for-10 reverse stock split.

As a result of the reverse split, each 10 shares of the Company’s issued and outstanding common stock will be automatically combined and converted into one issued and outstanding share of common stock, par value $0.01 per share. The Company’s common stock will trade under a new CUSIP number, 079481 404, effective February 6, 2020, and remain listed on the Nasdaq Global Market under the symbol "BLCM". The reverse stock split reduces the number of shares of common stock issuable upon the conversion of the Company’s outstanding shares of preferred stock and the exercise or vesting of its outstanding stock options, restricted stock units and warrants in proportion to the ratio of the reverse stock split and causes a proportionate increase in the conversion and exercise prices of such preferred stock, stock options and warrants.

No fractional shares of common stock will be issued as a result of the reverse stock split. Stockholders of record who would otherwise be entitled to receive a fractional share will receive a cash payment in lieu thereof. The reverse stock split impacts all holders of the Company’s common stock proportionally and will not impact any stockholder’s percentage ownership of the Company common stock (except to the extent the reverse stock split results in any stockholder owing only a fractional share).

Bellicum has chosen its transfer agent, American Stock Transfer & Trust Company, LLC ("AST"), to act as exchange agent for the reverse stock split. Stockholders owning shares via a bank, broker or other nominee will have their positions automatically adjusted to reflect the reverse stock split and will not be required to take further action in connection with the reverse stock split, subject to brokers’ particular processes. For those stockholders holding physical stock certificates, AST will send instructions for exchanging those certificates for shares held in book-entry form representing the post-split number of shares. AST can be reached at (800) 937 5449 or (718) 921 8124.

On February 5, 2020 Arrowhead Pharmaceuticals Inc. (NASDAQ: ARWR) reported financial results for its fiscal first quarter ended December 31, 2019 (Press release, Arrowhead Research Corporation, FEB 5, 2020, View Source [SID1234553874]). The company is hosting a conference call at 4:30 p.m. EST to discuss results.

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Conference Call and Webcast Details

Investors may access a live audio webcast on the Company’s website at View Source For analysts that wish to participate in the conference call, please dial 855-215-6159 or 315-625-6887 and provide Conference ID 6694317.

A replay of the webcast will be available on the company’s website approximately two hours after the conclusion of the call and will remain available for 90 days. An audio replay will also be available approximately two hours after the conclusion of the call and will be available for 3 days. To access the audio replay, dial 855-859-2056 or 404-537-3406 and provide Conference ID 6694317.

Selected Recent Events

Began dosing patients and completed enrollment of the first sequential cohort in the AROAAT2002 study, a pilot open-label, multi-dose, Phase 2 study to assess changes in a novel histological activity scale in response to ARO-AAT over time in patients with alpha-1 antitrypsin deficiency associated liver disease

Reported interim multiple-dose results on two cardiometabolic candidates ARO-APOC3, being developed as a potential treatment for patients with severe hypertriglyceridemia, and ARO-ANG3, being developed for the treatment of dyslipidemias and metabolic

diseases, showing high levels of reduction in APOC3, ANGPTL3, triglycerides, and other lipid parameters

Presented single-dose clinical data on ARO-APOC3 and ARO-ANG3 in two late-breaking oral presentations at the American Heart Association Scientific Sessions 2019

Completed regulatory submissions to begin Phase 1 studies of ARO-HSD for the treatment of alcohol and nonalcohol related liver disease, and ARO-HIF2 for the treatment of clear cell renal cell carcinoma. Both programs are on schedule to potentially begin dosing patients this quarter or early in the second quarter

Expanded Arrowhead’s senior management team with the hiring of seasoned biotech and pharma leaders Dr. Javier San Martin as chief medical officer, Dr. Curt Bradshaw as chief scientific officer, and Jim Hassard as chief commercial officer

Appointed Dr. Marianne De Backer as a new independent director; Marianne is currently Executive Vice President, Head of Global Business Development & Licensing, and a member of the Executive Committee of the Pharmaceuticals Division of Bayer AG

Hosted an analyst R&D day to discuss Arrowhead’s product development strategy, clinical candidates, and some exciting advancements being made to the TRiMTM platform, which can now reach multiple cell types and be used in a dimer structure that delivers multiple siRNA sequences together to achieve high levels of knockdown of two different genes simultaneously

Presented preclinical data at the North American Cystic Fibrosis Conference on ARO-ENaC, Arrowhead’s first TRiMTM-enabled inhaled, pulmonary candidate for the treatment of cystic fibrosis, which is on schedule for a CTA filing in the first half of 2020

Improved the balance sheet and extended Arrowhead’s cash runway with a financing with gross proceeds of approximately $267 million

On February 5, 2020 Ziopharm Oncology, Inc. (Nasdaq:ZIOP) reported that it intends to offer and sell shares of its common stock in an underwritten registered public offering (Press release, Ziopharm, FEB 5, 2020, View Source [SID1234553872]). All of the shares in the offering are to be sold by Ziopharm. Ziopharm also intends to grant the underwriters a 30-day option to purchase up to an additional fifteen percent (15%) of the number of shares of common stock offered in the public offering at the public offering price, less underwriting discounts and commissions. The offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

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Jefferies is acting as sole book-running manager for this offering and Cantor is acting as lead manager for this offering.

The securities are being offered pursuant to a shelf registration statement on Form S-3ASR, which became automatically effective upon filing with the Securities and Exchange Commission (SEC) on June 21, 2019. The offering will be made only by means of a prospectus supplement and accompanying prospectus that form a part of the registration statement. A preliminary prospectus supplement relating to the offering will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

When available, copies of the preliminary prospectus supplement and the accompanying prospectus relating to these securities may be obtained for free from Jefferies LLC, Attention: Equity Syndicate Prospectus Department, 520 Madison Avenue, 2nd Floor, New York, NY 10022, or by telephone at +1 877 821 7388 or by email at [email protected]; or Cantor Fitzgerald & Co., Attention: Capital Markets, 499 Park Avenue, 6th Floor, New York, New York 10022, or by email at [email protected].