On August 10, 2020 Ligand Pharmaceuticals Incorporated (NASDAQ: LGND) and Pfenex Inc. (NYSE American: PFNX) reported the signing of a definitive agreement for Ligand to acquire all outstanding shares of Pfenex for $12.00 per share in cash or $438 million in equity value on a fully diluted basis (Press release, Ligand, AUG 10, 2020, View Source [SID1234563353]). In addition, Ligand will pay $2.00 per share or $78 million as a Contingent Value Right (CVR) in the event a predefined regulatory milestone is achieved by December 31, 2021, for a total transaction value of up to $516 million. The closing of this transaction is subject to customary conditions and is expected to occur in the fourth quarter.

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Pfenex is a development and licensing biotechnology company focused on leveraging its proprietary Pfenex Expression Technology, which offers a robust, validated, cost-effective and scalable approach to recombinant protein production, and is especially well-suited for complex, large-scale protein production that cannot be made by more traditional systems. The technology is currently out-licensed for numerous commercial and development-stage programs, as well as used by Pfenex in developing an early stage product pipeline and nanobody discovery and development capability. The versatile platform has demonstrated consistent success in the production of enzymes, peptides, antibody derivatives and engineered non-natural proteins. Partners seek the Pfenex technology as it can contribute significant value to biopharmaceutical development programs by reducing development timelines and costs for manufacturing human therapeutics and vaccines.

Pfenex’s expertise in the expression of complex proteins is highly complementary to Ligand’s industry-leading antibody and drug enabling technologies, building a comprehensive discovery and early stage platform.

The acquisition of Pfenex is expected to contribute a number of strategic benefits to Ligand:

Access to a proprietary, protein expression technology that is utilized in various commercial and development-stage biopharmaceutical programs.
Versatile operating business that is focused on licensing and generating royalty revenue from partners.
Profitable, cash-flow positive business that is projected to be accretive to Ligand’s adjusted diluted EPS beginning in 2021.
Numerous major collaborations with leading pharmaceutical companies for treatments and vaccines, including Merck, Jazz Pharmaceuticals, Serum Institute of India and Alvogen.
Outlook for numerous additional licenses to be potentially secured over the next few years by Ligand leveraging the Pfenex technology.
Validated discovery platform technology driving a deep pipeline of next generation product candidates for future internal and external development.
State-of-the-art process development operation located in San Diego with scalable equipment and engineering capabilities designed to serve the world’s largest pharmaceutical companies.
"Pfenex is an ideal strategic, business and cultural fit with Ligand. The acquisition holds potential to have a significantly positive scientific and financial impact on our business in the short and long term, similar to how our Captisol and OmniAb acquisitions have played out," said John Higgins, Chief Executive Officer of Ligand. "Pfenex will add an established, proven protein expression platform to Ligand that is highly complementary to our essential, proprietary drug discovery and formulation technologies. We are confident we will be able to quickly and efficiently grow the Pfenex business, along with our core existing technologies. It has been a very positive experience working with the Pfenex executive leadership and senior scientists while we put this deal together. We look forward to welcoming the talented Pfenex team to Ligand."

"The Ligand-Pfenex combination is an excellent strategic and cultural fit, presenting a unique opportunity to leverage the complementary strengths of robust platforms and rich pipelines, we expect it to position us even better to deliver on our joint vision to develop therapeutics that provide patients a better future," said Eef Schimmelpennink, Chief Executive Officer, Pfenex. "I want to recognize and thank the Pfenex team, and express deep gratitude to each of you for your many contributions over the years, which have enabled us to reach this milestone."

Financial Outlook

Ligand will provide a detailed outlook for the Pfenex business and financial contribution after the transaction has closed. At this time, Ligand expects the transaction will be modestly dilutive to 2020 adjusted diluted EPS, will provide $0.10 to $0.30 of adjusted diluted EPS accretion in 2021, and will provide significant annual adjusted diluted EPS accretion thereafter with the current forecast of $0.60 to $0.80 in 2022 and $1.25 to $1.50 in 2023.

Transaction Terms

Under the terms of the merger agreement, Ligand will commence a tender offer to acquire all of the outstanding shares of Pfenex common stock for $12.00 per share, or $438 million upfront in cash. This represents a 57% premium to the closing price of Pfenex’s stock on August 10, 2020. Ligand will also pay holders of Pfenex common stock a price of $2.00 per share, or $78 million, as a Contingent Value Right in the event a predefined regulatory milestone is achieved by December 31, 2021. The tender offer is subject to customary conditions, including the tender of a majority of the outstanding shares of Pfenex common stock, and the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The transaction is expected to close in the fourth quarter of 2020 and be funded by Ligand with cash on hand.

William Blair & Company, L.L.C. served as Pfenex’s exclusive financial advisor. Wilson Sonsini Goodrich & Rosati served as Pfenex’s legal counsel. Barclays Capital Inc. served as Ligand’s exclusive financial advisor. Latham & Watkins LLP served as Ligand’s legal counsel.

Adjusted Financial Measures

The adjusted financial measures discussed above exclude changes in contingent liabilities, mark-to-market adjustment for amounts owed to licensors, non-cash stock-based compensation expense, non-cash debt-related costs, pro-rata non-cash net losses of Pfenex, non-cash Pfenex purchase price amortization and non-cash tax expense.

Ligand believes that the presentation of adjusted financial measures provides useful supplementary information to investors and reflects amounts that are more closely aligned with the cash profits for the period as the items that are excluded from adjusted net income are all non-cash items. Ligand uses these adjusted financial measures in connection with its own budgeting and financial planning. These adjusted financial measures are in addition to, and not a substitute for, or superior to, measures of financial performance prepared in conformity with GAAP.

On August 10, 2020 Avidity Biosciences, Inc. (Nasdaq: RNA), a biopharmaceutical company pioneering a new class of oligonucleotide-based therapies called Antibody Oligonucleotide Conjugates (AOCs), reported financial results for the quarter and six months ended June 30, 2020 and highlighted recent corporate progress (Press release, Avidity Biosciences, AUG 10, 2020, View Source [SID1234563352]).

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"The second quarter of 2020 was transformational for Avidity. With the substantial funds raised through our successful IPO and key additions to our leadership team and board, we are well-positioned to advance a meaningful pipeline of novel AOC therapeutics," said Sarah Boyce, President and CEO of Avidity. "We are focused on the execution of our research and development plans that include selection of clinical candidates directed towards diseases with significant unmet medical needs, with the goal to initiate three first-in-human studies by 2022."

Second Quarter 2020 and Recent Corporate Highlights

Completed Initial Public Offering ("IPO"): On June 16, 2020, the company completed its IPO selling 16,560,000 shares of common stock, which included the full exercise by the underwriters of their option to purchase 2,160,000 additional shares, at $18.00 per share. Gross proceeds from the IPO, excluding underwriting discounts and commissions and other estimated offering costs, were $298.1 million. Avidity’s common stock began trading on the NASDAQ Global Market on June 12, 2020 under the symbol "RNA".
Strengthened Leadership and Board of Directors: In April 2020, Avidity appointed Carsten Boess, an experienced financial leader, to its Board of Directors. In May 2020, Avidity appointed Michael MacLean as Chief Financial Officer, following his most recent tenure as Chief Financial Officer of Akcea Therapeutics, Inc. In July 2020, Avidity appointed Jae Kim, M.D., as Chief Medical Officer, following his most recent tenure as Clinical Research Head, Chair of the Clinical Trial Review Board, and Vice President of Clinical Development of Alnylam Pharmaceuticals, Inc.
Financial Results

Cash and Cash Equivalents: Cash and cash equivalents totaled $352.4 million as of June 30, 2020, which includes net proceeds of $274.1 million from the company’s IPO, compared to cash and cash equivalents of $94.6 million as of December 31, 2019.
Collaboration Revenue: Collaboration revenue, including reimbursable expenses, was $1.5 million for the second quarter of 2020 compared with $0.2 million for the second quarter of 2019, and $2.9 million for the first six months of 2020 compared with $0.2 million for the first six months of 2019.
Research and Development (R&D) Expenses: R&D expenses, including external and internal costs associated with our research activities, primarily relate to the progression of our research on AOC 1001 and other programs. These expenses were $9.0 million for the second quarter of 2020 compared with $2.5 million for the second quarter of 2019, and $14.5 million for the first six months of 2020 compared with $3.8 million for the first six months of 2019. The increases were primarily driven by the advancement of AOC 1001, as well as other programs.
General and Administrative (G&A) Expenses: G&A expenses primarily consist of employee-related expenses, professional fees, patent filing and maintenance fees, and insurance. These expenses were $2.9 million for the second quarter of 2020 compared with $1.6 million for the second quarter of 2019, and $4.9 million for the first six months of 2020 compared with $2.5 million for the first six months of 2019. The increases were primarily due to higher personnel costs and professional fees associated with the preparation of becoming a public company, as well as higher patent filing fees.

On August 10, 2020 CorMedix Inc. (NYSE American: CRMD), a biopharmaceutical company focused on developing and commercializing therapeutic products for the prevention and treatment of infectious and inflammatory disease, reported financial results for the second quarter and six months ended June 30, 2020 and provided an update on recent developments (Press release, CorMedix, AUG 10, 2020, View Source [SID1234563351]).

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Recent Corporate and Regulatory Highlights:

Completed an underwritten public offering of common stock, which yielded gross proceeds of approximately $23.0 million, including the full exercise of the underwriters’ option, or greenshoe.

Completed the rolling submission and review of the New Drug Application for Defencath to the FDA for the prevention of catheter related blood stream infections, or CRBSIs, in patients undergoing hemodialysis via catheter. The submission is currently been assessed by FDA for completeness and acceptance for filing.

Continued to expand our efforts to prepare for the commercial launch of Defencath. This includes ongoing dialogue with payors and providers, ongoing market research, and involvement with key advocacy organizations focused on kidney care.

Cash and short-term investments, excluding restricted cash, at June 30, 2020 amounted to $22.4 million. Pro forma cash, including cash on the balance sheet at June 30, 2020 and the net proceeds from the recent financing, is approximately $43.9 million.
Khoso Baluch, CorMedix CEO commented, "We have made significant progress on our goal of bringing Defencath to the U.S. market as a catheter lock solution for hemodialysis. We were pleased to announce the completion of our rolling submission for Defencath last month and look forward to providing updates on the acceptance for filing from FDA. Despite the turbulence in the markets, we were excited to complete an institutional financing and broaden our investment banking relationships while doing so. We also are making necessary preparations for the launch of Defencath in the U.S. hemodialysis market, following FDA approval. We believe we have the team, the focus, and a therapy that will meaningfully improve patient outcomes and are excited about the opportunities in front of us."

Second Quarter and Six Month 2020 Financial Highlights

For the second quarter 2020, CorMedix recorded a net loss of $3.8 million, or $0.14 per share, compared with a net loss of $0.7 million, or $0.03 per share, in the second quarter of 2019, an increase of $3.1 million. The higher net loss recognized in 2020 compared with 2019 was due to increased expenses related to our preparations for Defencath’s commercial launch. We recorded significant increases in both R&D and SG&A expenses. We recognized a tax benefit of $5.2 million in 2020 from the sale of our NJ Net Operating Losses compared with a $5.1 million benefit recorded in 2019.

Operating expenses in the second quarter of 2020 increased approximately 61% to $8.9 million, compared with $5.6 million in the second quarter of 2019. R&D expense increased approximately 91% to $5.7 million from $3.0 million, mainly due to a $3.4 million purchase of raw material that will be used in the production of Defencath for sale in the U.S. upon receipt of FDA marketing approval, partially offset by a 12% decrease in other R&D expenses. SG&A expense increased approximately 26% to $3.2 million compared with $2.6 million in the second quarter of 2019. Higher staffing, marketing and insurance expenses were primarily responsible for the increase, partially offset by reductions in several areas, particularly legal and accounting fees.

For the six months ended June 30, 2020, CorMedix recorded a net loss of $9.3 million, or $0.36 per share, compared with a net loss of $5.9 million, or $0.25 per share, in the first half of 2019, an increase of $3.4 million. Operating expenses in the first half of 2020 were $14.6 million, compared to $10.4 million in the first half of 2019, an increase of approximately 40%. This increase was due primarily to the raw material purchase in 2nd quarter and higher SG&A expenses throughout the organization.

Total cash on hand and short-term investments as of June 30, 2020 was $22.4 million, excluding restricted cash of $0.2 million. The Company believes that, based on the Company’s cash resources at June 30, 2020, it has sufficient resources to fund operations at least twelve months after the filing date of its report on Form 10-Q, after taking into consideration the approximately $21.5 million in net proceeds from the equity financing that closed in July 2020.

Conference Call Information

The management team of CorMedix will host a conference call and webcast today, August 10, 2020, at 4:30 PM Eastern Time, to discuss recent corporate developments and financial results. Call details and dial-in information is as follows:

Domestic: 877-423-9813
International: 201-698-8573
Conference ID: 13707638
Webcast: Webcast Link

On August 10, 2020 Mustang Bio, Inc. ("Mustang") (NASDAQ: MBIO), a clinical-stage biopharmaceutical company focused on translating today’s medical breakthroughs in cell and gene therapies into potential cures for hematologic cancers, solid tumors and rare genetic diseases, reported financial results and recent corporate highlights for the second quarter ended June 30, 2020 (Press release, Mustang Bio, AUG 10, 2020, View Source [SID1234563350]).

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Manuel Litchman, M.D., President and Chief Executive Officer of Mustang, said, "Mustang made progress on multiple fronts during the second quarter of 2020. In June, we raised gross proceeds of approximately $37.2 million in an underwritten public offering of common stock. On the clinical front, we continued to advance our robust pipeline of gene and CAR T cell therapy programs. Notably, we began enrolling patients in a Phase 1/2 clinical trial of MB-102 (CD123-targeted CAR T cell therapy) under our own Investigational New Drug ("IND") application for relapsed or refractory blastic plasmacytoid dendritic cell neoplasm, acute myeloid leukemia and high-risk myelodysplastic syndrome. We look forward to continued progress throughout the second half of this year, as we expect to initiate our pivotal MB-107 and MB-207 lentiviral gene therapy programs for newly diagnosed infants and previously transplanted patients with X-linked severe combined immunodeficiency ("XSCID") and to disclose additional data from our MB-106 CD20-targeted CAR T cell therapy program."

Recent Corporate Highlights:

In June 2020, Mustang raised gross proceeds of approximately $37.2 million in an underwritten public offering of common stock, including the exercise of the underwriter’s option.
In May 2020, City of Hope presented two posters pertaining to MB-104, an innovative CS1 CAR T cell therapy, at the virtual 23rd Annual Meeting of the American Society of Gene & Cell Therapy ("ASGCT").
Also in May 2020, Mustang submitted an IND application to the U.S. Food and Drug Administration ("FDA") to initiate a multi-center Phase 2 clinical trial of MB-107 in newly diagnosed infants with XSCID who are under the age of two. The trial is expected to enroll 10 patients who, together with 15 patients enrolled in the current multi-center trial led by St. Jude Children’s Research Hospital, will be compared with 25 matched historical control patients who have undergone hematopoietic stem cell transplant ("HSCT"). The primary efficacy endpoint will be event-free survival. The initiation of this trial is currently on hold pending CMC clearance by the FDA, which is expected in early Q4 2020. Mustang is targeting topline data from this trial in the second half of 2022.
Mustang expects to file an IND in the fourth quarter of 2020 for a registrational multi-center Phase 2 clinical trial of its lentiviral gene therapy in previously transplanted XSCID patients. This product will be designated MB-207. Mustang anticipates enrolling 20 patients and comparing them to matched historical control patients who have undergone a second HSCT. The company is targeting topline data from this trial in the second half of 2022.
In the ongoing Phase 1 trial of MB-105, a PSCA-directed CAR T administered systemically to patients with PSCA-positive castration resistant prostate cancer, at City of Hope, the first patient to receive the therapy following a standard CAR T conditioning regimen experienced a significant reduction in his prostate-specific antigen ("PSA") at day 28. This PSA response was associated with radiographic improvement of the patient’s metastatic disease.
In April 2020, Mustang announced that the European Medicines Agency ("EMA") granted Advanced Therapy Medicinal Product ("ATMP") classification to MB-107 for the treatment of XSCID.
Financial Results:

As of June 30, 2020, the company’s cash, cash equivalents and restricted cash totaled $86.4 million, compared to $56.8 million as of March 31, 2020, and $62.4 million as of December 31, 2019.
Research and development expenses were $9.8 million for the second quarter of 2020. This compares to $6.8 million for the second quarter of 2019. Non-cash, stock-based compensation expenses included in research and development were $0.4 million for the second quarter of 2020, compared to $0.3 million for the second quarter of 2019.
Research and development expenses from license acquisitions totaled $1.3 million for the second quarter of 2020, compared to $0.2 million for the second quarter of 2019.
General and administrative expenses were $3.0 million for the second quarter of 2020. This compares to $3.2 million for the second quarter of 2019. Non-cash, stock-based compensation expenses included in general and administrative expenses were $1.5 million for the second quarter of 2020, compared to $1.6 million for the second quarter of 2019.
Net loss attributable to common stockholders was $14.6 million, or $0.32 per share, for the second quarter of 2020, compared to a net loss attributable to common stockholders of $10.4 million, or $0.29 per share, for the second quarter of 2019.

On August 10, 2020 Fortress Biotech, Inc. (NASDAQ: FBIO) ("Fortress"), an innovative revenue-generating company focused on acquiring, developing and commercializing or monetizing promising biopharmaceutical products and product candidates cost-effectively, reported financial results and recent corporate highlights for the second quarter ended June 30, 2020 (Press release, Fortress Biotech, AUG 10, 2020, View Source [SID1234563349]).

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Lindsay A. Rosenwald, M.D., Fortress’ Chairman, President and Chief Executive Officer, said, "Fortress has continued to efficiently and effectively execute on its growth objectives due to our unique business model. We are proud to have generated total net revenue of $21.4 million from our five marketed pharmaceutical products in the first half of 2020, a year-over-year increase of 50%, despite this unprecedented time. Moreover, during the second quarter, we acquired a broad platform technology from Columbia University to effectively deliver novel, proprietary oligonucleotides for the treatment of genetically driven cancers, with an initial target of KRAS-driven cancers. We are also exploring the potential of the platform to treat novel coronaviruses, such as COVID-19."

Dr. Rosenwald continued, "Additionally, we continue to work with our partner companies to steadily build and advance our growing portfolio of commercial and development-stage product candidates. Our goal is to increase intrinsic value for our shareholders. In the second half of 2020, we look forward to a multitude of key inflection points, including: additional data from our registration-enabling clinical trial of cosibelimab in patients with metastatic cutaneous squamous cell carcinoma ("mCSCC"), the PDUFA date for IV tramadol in October and initiating the rolling submission of the New Drug Application ("NDA") to the U.S. Food and Drug Administration ("FDA") for CUTX-101 for the treatment of Menkes disease. We also anticipate the potential launch of four more registration-enabling clinical trials this year, two CAEL-101 pivotal trials for AL amyloidosis and two MB-107 and MB-207 lentiviral gene therapy clinical trials for newly diagnosed infants and previously transplanted patients with X-linked severe combined immunodeficiency ("XSCID")."

Recent Corporate Highlights1:

Marketed Dermatology Products
•Our dermatology products are marketed by our partner company, Journey Medical Corporation ("Journey").
•Our products generated $21.4 million in revenues in the first half of 2020, compared to $14.3 million in the first half of 2019, representing growth of 50% year-over-year. Our products generated second quarter 2020 net revenues of $9.4 million, compared to second quarter 2019 net revenues of $8.2 million, a 15% increase. Second quarter sales were below expectations due to COVID-19.
•We intend to acquire up to two new prescription products in 2020.

IV Tramadol
•In April 2020, Avenue Therapeutics ("Avenue") announced that two e-posters highlighting efficacy and safety results from its Phase 3 program are available for online viewing from the cancelled Annual Regional Anesthesiology and Acute Pain Medicine Meeting hosted by the American Society of Regional Anesthesia and Pain Medicine ("ASRA").
• The e-poster (816), titled, "Intravenous Tramadol is Effective in Management of Postoperative Pain Following Abdominoplasty: A 3-arm Randomized Controlled Trial," includes data from the Phase 3 abdominoplasty study and can be found here.
•The e-poster (1001), titled, "IV tramadol – A New Treatment Option for Management of Post-Operative Pain: A Safety Trial Including Various Types of Surgery," includes data from the Phase 3 safety study and can be found here.
•In June 2020, Avenue announced the following clinical study publications in peer-reviewed journals.
•"Intravenous Tramadol is Effective in the Management of Postoperative Pain Following Abdominoplasty: A Three-Arm Randomized Placebo- and Active-Controlled Trial," was published in Drugs in R&D and can be accessed here.
"IV Tramadol – A New Treatment Option for Management of Post-Operative Pain in the U.S.: An Open-Label, Single-Arm, Safety Trial Including Various Types of Surgery," was published in Journal of Pain Research and can be accessed here.
•In July 2020, Avenue announced the following publication of its Phase 3 bunionectomy study.
•"Efficacy and Safety of Intravenously Administered Tramadol in Patients with Moderate to Severe Pain Following Bunionectomy: A Randomized, Double-Blind, Placebo-Controlled, Dose-Finding Study," was published in Pain and Therapy and can be accessed here.
•The FDA assigned IV tramadol a PDUFA date of October 10, 2020.
•IV tramadol is currently in development at our partner company, Avenue.

CUTX-101 (Copper Histidinate for Menkes disease)
•In June 2020, we announced the publication of a study, "Estimated birth prevalence of Menkes disease and ATP7A-related disorders based on the Genome Aggregation Database (gnomAD)," in Molecular Genetics and Metabolism Reports. Assuming Hardy-Weinberg genetic equilibrium, the allelic frequency of loss-of-function variants suggests a minimum birth prevalence for Menkes disease of 1 in 34,810 males, higher than previously recognized. If likely pathogenic missense variants are included, the estimated birth prevalence could potentially be as high as 1 in 8,664 live male births. The study can be accessed here.
•In July 2020, we announced the publication of a study, "Targeted Next Generation Sequencing for Newborn Screening of Menkes Disease," in Molecular Genetics and Metabolism Reports. The study assessed the analytic validity of an ATP7A targeted next generation DNA sequencing assay as a potential newborn screen for Menkes disease, an X-linked recessive disorder of copper metabolism caused by mutations in ATP7A, an evolutionarily conserved copper-transporting ATPase. The study can be accessed here.
•In July 2020, we announced that the European Medicines Agency ("EMA") Committee for Orphan Medicinal Products issued a positive opinion on Cyprium Therapeutics’ application for Orphan Drug Designation for Copper Histidinate, also referred to as CUTX-101, a potential treatment for Menkes disease. EMA Orphan Drug Designation provides companies with certain benefits and incentives, including clinical protocol assistance, differentiated evaluation procedures for Health Technology Assessments in certain countries, access to a centralized marketing authorization procedure valid in all EU member states, reduced regulatory fees and 10 years of market exclusivity. The FDA previously granted Orphan Drug, Fast Track and Rare Pediatric Disease Designations to CUTX-101 for the treatment of Menkes disease.
•We intend to begin the rolling submission of the NDA for CUTX-101 to the FDA in the fourth quarter of 2020.
•CUTX-101 is currently in development at our partner company, Cyprium Therapeutics, Inc.

Cosibelimab (anti-PD-L1 antibody)

•In April 2020, we announced that the U.S. Patent and Trademark Office issued a composition of matter patent for cosibelimab. U.S. Patent No. 10,590,199 specifically covers the antibody, cosibelimab, or a fragment thereof, providing protection through at least May 2038, exclusive of any additional patent-term extensions that might become available.
•In July 2020, we announced that an abstract highlighting updated interim safety and efficacy data from the ongoing registration-enabling clinical trial of cosibelimab in patients with mCSCC was accepted for e-poster presentation at the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) Virtual Congress 2020, to be held September 19-21, 2020.
•The registration-enabling study in mCSCC is currently over 50% enrolled, with full enrollment anticipated around year-end. With a potentially favorable safety profile and a plan to commercialize at a substantially lower price, we believe cosibelimab can be a market disruptive product in the $25 billion and growing PD-(L)1 class.
•Cosiblimab is currently in development at our partner company, Checkpoint Therapeutics, Inc.

CAEL-101 (light chain fibril-reactive monoclonal antibody for AL amyloidosis)
•Dosing is complete in the Phase 2 dose selection portion of the program; the Phase 3 portion of the pivotal program is planned to begin in the third quarter of 2020, pending dose selection.
• CAEL-101 is currently in development at Caelum Biosciences, Inc.

MB-107 and MB-207 (lentiviral gene therapies for XSCID)
•In April 2020, we announced that the EMA granted Advanced Therapy Medicinal Product ("ATMP") classification to MB-107, a lentiviral gene therapy for the treatment of XSCID, also known as bubble boy disease.
•In May 2020, Mustang Bio, Inc. ("Mustang") submitted an Investigational New Drug ("IND") application to the FDA to initiate a multi-center Phase 2 clinical trial of MB-107 in newly diagnosed infants with XSCID who are under the age of two. The trial is expected to enroll 10 patients who, together with 15 patients enrolled in the current multicenter trial led by St. Jude Children’s Research Hospital, will be compared to 25 matched historical control patients who have undergone hematopoietic stem cell transplant ("HSCT"). The primary efficacy endpoint will be event-free survival. The initiation of this trial is currently on hold pending CMC clearance by the FDA, which is expected in early Q4 2020. Mustang is targeting top-line data from the trial in the second half of 2022.
•Mustang further expects to file an IND in the fourth quarter of 2020 for a registrational multi-center Phase 2 clinical trial of its lentiviral gene therapy in previously transplanted XSCID patients. This product will be designated MB-207. Mustang anticipates enrolling 20 patients and evaluating those subjects in comparison to matched historical control patients who have undergone a second HSCT. Mustang is targeting top-line data from this trial in the second half of 2022.
•MB-107 and MB-207 are currently in development at our partner company, Mustang.

MB-104 (CS1-targeted CAR T cell therapy)
•In May 2020, City of Hope presented two posters pertaining to MB-104, an innovative CS1 CAR T cell therapy, at the virtual 23rd Annual Meeting of the American Society of Gene & Cell Therapy ("ASGCT").
•MB-104 is currently in development at our partner company, Mustang.

ONCOlogues (proprietary platform technology using PNA oligonucleotides)
•In May 2020, we entered into an exclusive worldwide licensing agreement with Columbia University to develop novel oligonucleotides for the treatment of genetically driven cancers. The proprietary platform produces oligomers, known as "ONCOlogues," which are capable of binding gene sequences 1,000 times more effectively than complementary native DNA.
•ONCOlogues invade a DNA double helix and displace native mutated strands. This may prevent the mRNA that antisense binds to from ever being created. It is active higher upstream than traditional antisense approaches, as well as potentially more potent and broader in its utility.
•In addition, we are exploring the potential of the platform to treat novel coronaviruses, such as COVID-19.
•The "Suppression of KRAS-G12D and BRAF-V600E Oncogene Transcription with PNA Conjugates," data presentation from the ESMO (Free ESMO Whitepaper) Congress in 2019 can be found here.
•The ONCOlogues platform is currently in development at our partner company, Oncogenuity, Inc.

General Corporate
•In May 2020, we closed on a gross total of approximately $11.5 million in an underwritten public offering of our 9.375% Series A Cumulative Redeemable Perpetual Preferred Stock.
•In June 2020, Fortress and Avenue were added to the Russell 3000 index.
Financial Results:

To assist our stockholders in understanding our company, we have prepared non-GAAP financial results for the three months and six months ended June 30, 2020 and 2019. These results exclude the operations of our three public partner companies: Avenue Therapeutics, Inc. ("Avenue"), Checkpoint Therapeutics, Inc. ("Checkpoint") and Mustang Bio, Inc. ("Mustang"), as well as any one-time, non-recurring, non-cash transactions, such as the gain of $18.4 million we recorded in the first quarter of 2019 resulting from the de-consolidation of Caelum Biosciences, Inc. ("Caelum"). The goal in providing these non-GAAP financial metrics is to highlight the financial results of Fortress’ core operations, which are comprised of our commercial-stage business, our privately held development-stage entities, as well as our business development and finance functions.

•As of June 30, 2020, Fortress’ consolidated cash, cash equivalents and restricted cash totaled $199.9 million, compared to $152.5 million as of March 31, 2020 and $153.4 million as of December 31, 2019.
•Fortres’ net revenue totaled $9.5 million for the second quarter of 2020, which included $9.4 million in net revenue generated from our marketed dermatology products. This compares to net revenue totaling $9.3 million for the second quarter of 2019, which included $8.2 million in net revenue generated from our marketed dermatology products.
•On a GAAP basis, consolidated research and development expenses were $15.7 million for the second quarter of 2020, compared to $18.5 million for the second quarter of 2019. On a non-GAAP basis, research and development expenses were $1.7 million for the second quarter of 2020, compared to $1.2 million for second quarter of 2019.
•On a GAAP basis, consolidated research and development expenses from license acquisitions totaled $1.6 million for the second quarter of 2020, compared to $0.2 million for the second quarter of 2019.
•On a GAAP basis, consolidated general and administrative expenses were $14.5 million for the second quarter of 2020, compared to $13.4 million for the second quarter of 2019. On a non-GAAP basis, general and administrative expenses were $10.4 million, of which $4.8 million is attributed to Journey, for the second quarter of 2020, compared to $9.4 million, of which $4.9 million is attributed to Journey, for the second quarter of 2019.
•On a GAAP basis, consolidated net loss attributable to common stockholders was $13.3 million, or $0.19 per share, for the second quarter of 2020, compared to net loss attributable to common stockholders of $13.1 million, or $0.24 per share for the second quarter of 2019.
•Fortress’ non-GAAP loss attributable to common stockholders was $3.7 million, or $0.05 per share, for the second quarter of 2020, compared to Fortress’ non-GAAP loss attributable to common stockholders of $2.4 million, or $0.04 per share, for the second quarter of 2019.

Avenue net loss from their external SEC report for the three months ended June 30, 2020 and 2019 of $1.9 million and $7.0 million, respectively, net of non-controlling interest of $1.4 million and $5.2 million, respectively. Avenue net loss from their external SEC report for the six months ended June 30, 2020 and 2019 of $3.1 million and $18.3 million, respectively, net of non-controlling interest of $2.4 million and $13.2 million, respectively.

Checkpoint net loss from their external SEC report of $4.6 million net of non-controlling interest of $3.4 million, MSA fee to Fortress of $0.1 million and financing fee to Fortress of $0.1 million for the three months ended June 30, 2020; and net loss of $4.8 million net of non-controlling interest of $3.1 million, MSA fee to Fortress of $0.1 million and financing fee to Fortress of $0.1 million for the three months ended June 30, 2019. Checkpoint net loss from their external SEC report of $7.9 million net of non-controlling interest of $5.8 million, MSA fee to Fortress of $0.3 million and financing fee to Fortress of $0.1 million for the six months ended June 30, 2020; and net loss of $10.7 million net of non-controlling interest of $7.1 million, MSA fee to Fortress of $0.3 million and financing fee to Fortress of $0.1 million for the six months ended June 30, 2019.

Mustang net loss from their external SEC report of $14.6 million net of non-controlling interest of $9.7 million, MSA fee to Fortress of $0.1 million and financing fee to Fortress of $1.0 million for the three months ended June 30, 2020; and net loss of $10.4 million net of non-controlling interest of $5.8 million, MSA fee to Fortress of $0.1 million and financing fee to Fortress of $1.3 million for the three months ended June 30, 2019. Mustang net loss from their external SEC report of $26.5 million net of non-controlling interest of $17.7 million, MSA fee to Fortress of $0.3 million and financing fee to Fortress of $1.1 million for the six months ended June 30, 2020; and net loss of $20.0 million net of non-controlling interest of $11.3 million, MSA fee to Fortress of $0.3 million and financing fee to Fortress of $1.7 million for the six months ended June 30, 2019.

Caelum’s one-time gain from de-consolidation recorded in January 2019.
Excludes $62,500 and $62,500 of Fortress MSA expense for the three months ended June 30, 2020 and 2019, respectively, and $0.1 million and $0.1 million for the six months ended June 30, 2020 and 2019, respectively.

Excludes $0.1 million of Fortress MSA expense and $0.1 million Fortress financing fee for the three months ended June 30, 2020; and $0.1 million of Fortress MSA expense and $0.1 million Fortress financing fee for the three months ended June 30, 2019. Excludes $0.3 million of Fortress MSA expense and $0.1 million Fortress financing fee for the six months ended June 30, 2020; and $0.3 million of Fortress MSA expense and $0.1 million Fortress financing fee for the six months ended June 30, 2019.

Excludes $62,500 of Fortress MSA expense and $1.0 million Fortress financing fee for the three months ended June 30, 2020; and $62,500 of Fortress MSA expense and $1.3 million Fortress financing fee for the three months ended June 30, 2019. Excludes $0.3 million of Fortress MSA expense and $1.1 million Fortress financing fee for the six months ended June 30, 2020; and $0.3 million of Fortress MSA expense and $1.7 million Fortress financing fee for the six months ended June 30, 2019.