On August 6, 2020 Lineage Cell Therapeutics, Inc. (NYSE American and TASE: LCTX), a clinical-stage biotechnology company developing novel cell therapies for unmet medical needs, reported financial and operating results for the second quarter ended June 30, 2020 (Press release, Lineage Cell Therapeutics, AUG 6, 2020, View Source [SID1234563087]). Lineage management will host a conference call today at 5:30 p.m. Eastern Time/2:30 p.m. Pacific Time to discuss its second quarter 2020 financial and operating results and to provide a business update.

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"Lineage has continued to make significant progress across our entire cell therapy pipeline, with positive milestones on each of our three programs announced this quarter," stated Brian M. Culley, Lineage CEO. "Most importantly, after moving into a cohort of patients with less advanced disease, we reported the first known finding of retinal tissue restoration, which we believe could become a landmark discovery in the treatment of dry AMD. Specifically, Lineage reported evidence of substantial anatomical restoration of retinal tissue within an area of geographic atrophy, or GA. The area of GA was approximately 25% smaller when assessed at 9 months, compared to the patient’s pre-treatment baseline. These findings were initially discovered by an independent external advisor using multiple imaging technologies and were subsequently confirmed by the reading center and additional experts in the field of retinal imaging. In light of the significance of this finding, our objective is to treat and monitor the final three patients in Cohort 4 of our dry AMD study and seek to demonstrate additional evidence of this exciting finding. These data also will direct our clinical, regulatory, and ongoing partnership discussions.

We also recently exercised an option with Cancer Research UK, which allowed us to assume responsibility for advancing our dendritic cell vaccine program, strengthening our pipeline and moving Lineage more prominently into the field of cancer immunotherapy. The VAC platform will permit us to expand not only our oncology pipeline, but also enter infectious diseases, with steps being taken to identify external funding to develop a SARS-CoV-2 vaccine, based on VAC platform data showing strong induction of cellular immunity via T cells.

Lastly, we have made significant progress developing and implementing manufacturing improvements for our OPC1 program to treat spinal cord injuries. We now are working to develop a "thaw-and-inject" formulation and are evaluating a superior delivery system to enable an easier and faster surgical procedure and facilitate enrollment in a late-stage clinical study.

Our aim is to provide safe and sustained benefits of targeted cell-based therapies, alongside commercially relevant solutions with competitive advantages in areas of scale-up, production costs, and delivery techniques. We believe our holistic approach to designing new therapeutic solutions will allow us to position ourselves as the clear leader in the emerging field of cell therapy transplant medicine."

Lineage has the following plans and objectives for the second half of 2020:

-Meet with Biomedical Advanced Research and Development Authority (BARDA) in August to discuss our proposal for non-dilutive support for a coronavirus vaccine candidate.

-Report initial VAC2 clinical data from patients treated in the ongoing Phase 1 trial in NSCLC (non-small cell lung cancer) run by Cancer Research UK.

-Complete patient enrollment in the U.S. with the Gyroscope Orbit SDS and new thaw-and-inject formulation in the ongoing Phase 1/2a clinical trial of OpRegen for the treatment of dry AMD.

-Present new and accumulated OpRegen data from the ongoing Phase 1/2a clinical trial at the American Academy of Ophthalmology (AAO) Annual 2020 Meeting the second week of November.

-Meet with the U.S. Food and Drug Administration (FDA) to discuss further development of the OPC1 program.

Balance Sheet and Cash Flow Highlights

Cash, cash equivalents, and marketable securities totaled $20.3 million as of June 30, 2020. Marketable securities include our remaining ownership of unrestricted securities in OncoCyte Corporation (OncoCyte), AgeX Therapeutics, Inc. (AgeX) and Hadasit Bio-Holdings Ltd (Hadasit).

We have continued to fund our operations primarily by selling a portion of our marketable securities. In the six months ended June 30, 2020, we sold approximately 4.8 million shares of OncoCyte common stock for net proceeds of $10.9 million. We continue to hold approximately 3.6 million shares of OncoCyte stock that are valued at $6.8 million as of August 4, 2020, based on the closing price of its common stock on that date. All of our marketable securities are now in companies in which we hold less than 10% of the outstanding shares.

In conjunction with the sale of AgeX shares to Juvenescence Limited (Juvenescence) in 2018, we also hold a $21.6 million promissory note bearing 7% annual interest that matures later this month, on August 30, 2020. As of June 30, 2020, the outstanding principal and accrued interest on the note was $24.4 million. If, prior to August 30, 2020, Juvenescence completes an initial public offering resulting in gross proceeds of at least $50.0 million, the promissory note automatically converts into the Juvenescence securities.

Net cash used in operating activities for the six months ended June 30, 2020 was approximately $9.3 million, a decrease of $9.7 million as compared to $19.0 million in the same period of 2019. Additionally, net cash used in the three months ended June 30, 2020 of $4.3 million is $0.7 million lower than net cash used in the three months ended March 31, 2020 of $5.0 million.

Second Quarter Operating Results

Revenues: Lineage’s revenue is generated primarily from research grants, royalties and licensing fees. Total revenues for the three months ended June 30, 2020 were $0.4 million, a decrease of $0.4 million as compared to $0.8 million for the same period in 2019. The decrease was primarily related to a $0.2 million decrease in grant revenue due to the timing of grant related activities for OpRegen and other ophthalmic applications and a $0.1 million decrease in the sale of research products and services due to the cessation of such sales.

Operating Expenses: Operating expenses are comprised of research and development (R&D) expenses and general and administrative (G&A) expenses. Total operating expenses for the three months ended June 30, 2020 were approximately $6.7 million, a decrease of $4.8 million as compared to $11.5 million for the same period in 2019.

R&D Expenses: R&D expenses for the three months ended June 30, 2020 were $2.8 million, an approximate decrease of $2.4 million as compared to $5.2 million for the same period in 2019. The overall decrease was primarily related to decreases of $1.7 million in OpRegen and other ophthalmic application expenses, attributable primarily to a decrease in manufacturing activities in 2020 as compared to 2019, and $0.7 million in OPC1 expenses, primarily related to a decrease in development activities in 2020 as compared to 2019 when technology transfer was a focus to support OPC1 coming in-house with the acquisition of Asterias.

G&A Expenses: G&A expenses for the three months ended June 30, 2020 were $3.9 million, a decrease of $2.4 million as compared to approximately $6.3 million for the same period in 2019. The decrease was primarily attributable to a $1.6 million reduction in expenses related to our merger with Asterias Biotherapeutics, Inc. (Asterias), a $0.2 million reduction in compensation expenses, a $0.2 million reduction in investor and public relations expenses, a $0.2 million reduction in accounting expenses, a $0.1 million reduction in travel expenses, a $0.1 million reduction in rent expenses and a $0.1 million reduction in consulting expenses, offset by a $0.2 million increase related to the cessation of shared services reimbursements.

Loss from Operations: Loss from operations for the three months ended June 30, 2020 was $6.4 million, a decrease of $4.4 million as compared to $10.8 million for the same period in 2019.

Other (Expense) Income, Net: Other income/(expenses), net for the three months ended June 30, 2020 reflected other expense, net of ($0.1) million, compared to other expense, net of ($20.5) million for the same period in 2019. The variance was primarily related to changes in the value of equity method investments and marketable equity securities for the applicable periods, as well as foreign currency translation adjustments related to Lineage’s international subsidiaries. The value of Lineage’s OncoCyte shares decreased by $21.4 million in the three months ended June 30, 2019, which contributed greatly to the overall balance in other expense, net for that period.

Net loss attributable to Lineage: The net loss attributable to Lineage for the three months ended June 30, 2020 was $6.5 million, or $0.04 per share (basic and diluted), compared to a net loss attributable to Lineage of $30.0 million, or $0.20 per share (basic and diluted), for the same period in 2019.

Conference Call and Webcast

Lineage will host a conference call and webcast today, at 2:30 pm PT/5:30 pm ET to discuss its second quarter 2020 financial results and to provide a business update. Interested parties may access the conference call by dialing (866) 888-8633 from the U.S. and Canada and (636) 812-6629 from elsewhere outside the U.S. and Canada and should request the "Lineage Cell Therapeutics Call". A live webcast of the conference call will be available online in the Investors section of Lineage’s website. A replay of the webcast will be available on Lineage’s website for 30 days and a telephone replay will be available through August 14, 2020, by dialing (855) 859-2056 from the U.S. and Canada and (404) 537-3406 from elsewhere outside the U.S. and Canada and entering conference ID number 6649516.

On August 6, 2020 FibroGen, Inc. (NASDAQ: FGEN) reported financial results for the second quarter of 2020 and provided an update on the company’s recent developments (Press release, FibroGen, AUG 6, 2020, View Source [SID1234563086]).

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"Despite this difficult time, we continue to be inspired by our unique opportunity to leverage world-class science to benefit patients," said Enrique Conterno, Chief Executive Officer, FibroGen. "I am pleased with the progress we are making with roxadustat across a number of fronts; including our engagement with the FDA, the European submission, and our impressive sales in China. Additionally, we recently initiated three new trials with pamrevlumab: our Phase 3 study with DMD and two trials in patients hospitalized with COVID-19."

Key Events in Recent Months and Other Developments

Roxadustat

U.S. NDA for roxadustat for the treatment of anemia of chronic kidney disease (CKD), in dialysis-dependent and non-dialysis-dependent patients, is under review with a Prescription Drug User Fee Act (PDUFA) date of December 20, 2020.

Marketing authorization application (MAA) for roxadustat for the treatment of anemia in adult patients with CKD, both on dialysis and not on dialysis, accepted by the European Medicines Agency (EMA) for regulatory review in May.

Japan sNDA for roxadustat for the treatment of anemia of CKD in non-dialysis-dependent patients is under review.

Presented results from the DOLOMITES Phase 3 study at the 57th ERA-EDTA Virtual Congress in which roxadustat demonstrated non-inferiority to darbepoetin alfa in achievement of hemoglobin correction in non-dialysis-dependent patients with CKD.

Continued enrollment of Phase 3 roxadustat clinical trial in anemia associated with myelodysplastic syndromes (MDS) and Phase 2 roxadustat clinical trial in chemotherapy-induced anemia (CIA).

Pamrevlumab

Initiated a randomized, double-blind, placebo-controlled Phase 2 study investigating the efficacy and safety of pamrevlumab in approximately 130 hospitalized patients with acute COVID-19 infection in the U.S.

Initiated BOREA, a Phase 2/3 investigator-initiated clinical trial investigating the efficacy and safety of pamrevlumab in approximately 68 patients hospitalized with COVID-19 in Italy.

Reopened enrollment of the ZEPHYRUS Phase 3 clinical trial of pamrevlumab in patients with IPF after pausing for two months to minimize the risk of exposure to COVID-19.

Continued enrollment of the LAPIS Phase 3 clinical trial of pamrevlumab in patients with locally advanced unresectable pancreatic cancer (LAPC).

Upcoming Events

Plan to initiate ZEPHYRUS 2, a second IPF Phase 3 clinical trial similar in size and design to ZEPHYRUS, as COVID-19 conditions improve.

Plan to initiate LELANTOS, a Phase 3, randomized, double-blind, placebo-controlled trial of pamrevlumab in approximately 90 patients with non-ambulatory Duchenne muscular dystrophy (DMD).

Corporate and Financial

Total revenue for the second quarter of 2020 was $42.9 million, as compared to $191.6 million for the second quarter of 2019. The current quarter revenue consisted of $15.7 million in net roxadustat sales in China, $19.0 million in development revenue, and $8.2 million in roxadustat API sales to Astellas in Japan.

Net loss for the second quarter of 2020 was $85.3 million, or $0.95 net loss per basic and diluted share, compared to a net income of $116.0 million, or $1.34 net income per basic share and $1.26 per diluted share one year ago.

At June 30, 2020, FibroGen had $716.0 million in cash, cash equivalents, restricted time deposits, investments, and receivables.

Based on our latest forecast, we reiterate our year-end 2020 estimate to be in the range of $720 to $730 million in cash, cash equivalents, restricted time deposits, investments, and receivables.

Amended China Agreement with AstraZeneca in July 2020 such that both parties are optimally aligned to maximize the economic value of the roxadustat franchise, with more predictable economics and profitability for FibroGen.

Appointed Thane Wettig to the newly-created position of Chief Commercial Officer.

Appointed Aoife Brennan, M.B., B.Ch., President and CEO of Synlogic Inc. (NASDAQ:SYBX) to board of directors effective August 5, 2020.

Appointed Ben Cravatt, Ph.D., Professor and the Norton B. Gilula Chair of Chemical Biology in the Department of Chemistry at The Scripps Research Institute to board of directors effective August 5, 2020.

Conference Call and Webcast Details

FibroGen will host a conference call and webcast today, Thursday, August 6, 2020, at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) to discuss financial results and provide a business update. A live audio webcast of the call may be accessed in the investor section of the company’s website, www.fibrogen.com. To participate in the conference call by telephone, please dial 1 (877) 658-9081 (U.S. and Canada) or 1 (602) 563-8732 (international), reference the FibroGen second quarter 2020 financial results conference call, and use passcode 8363719. A replay of the webcast will be available shortly after the call for a period of two weeks. To access the replay, please dial (855) 859-2056 (domestic) or (404) 537-3406 (international) and use passcode 8363719.

About Roxadustat

Roxadustat is a first-in-class, orally administered small molecule HIF-PH inhibitor that promotes erythropoiesis through increasing endogenous production of erythropoietin, and improved iron absorption, transport and mobilization. Roxadustat is approved in China for the treatment of anemia in adult patients with CKD, both on dialysis and not on dialysis. In Japan it is approved for the treatment of anemia in CKD patients on dialysis and a supplemental NDA for the treatment of anemia in CKD patients not on dialysis is under regulatory review. The roxadustat NDA for the treatment of anemia in CKD is under review by the U.S. Food and Drug Administration with a Prescription Drug User Fee Act date of December 20, 2020. The Marketing Authorization Application for roxadustat for the treatment of anemia in CKD was filed by our partner Astellas and accepted by the European Medicines Agency for review on May 21, 2020. Roxadustat is also in clinical development for anemia associated with myelodysplastic syndromes (MDS) and for chemotherapy-induced anemia (CIA).

Astellas and FibroGen are collaborating on the development and commercialization of roxadustat for the treatment of anemia in territories including Japan and Europe. AstraZeneca and FibroGen are collaborating on the development and commercialization of roxadustat for the treatment of anemia in the U.S., China, and other markets.

About Pamrevlumab

Pamrevlumab is a first-in-class antibody developed by FibroGen that inhibits the activity of connective tissue growth factor (CTGF), a common factor in fibrotic and proliferative disorders. Pamrevlumab is in Phase 3 clinical development for the treatment of idiopathic pulmonary fibrosis (IPF) and locally advanced unresectable pancreatic cancer (LAPC), and in Phase 2 clinical development for the treatment of Duchenne muscular dystrophy (DMD) and coronavirus (COVID-19). For information about pamrevlumab studies currently recruiting patients, please visit www.clinicaltrials.gov.

On August 6, 2020 Exelixis, Inc. (Nasdaq: EXEL) reported financial results for the second quarter of 2020 and provided an update on progress toward fulfilling its key corporate objectives, as well as commercial and clinical development milestones (Press release, Exelixis, AUG 6, 2020, View Source [SID1234563085]).

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"Exelixis continued to execute on our key priorities and milestones in the second quarter of 2020," said Michael M. Morrissey, Ph.D., President and Chief Executive Officer of Exelixis. "The data flow in the quarter was headlined by the positive top-line results from the phase 3 pivotal CheckMate -9ER study evaluating the combination of cabozantinib and nivolumab in first-line renal cell carcinoma. We’re looking forward to the presentation of detailed results from the trial at the European Society for Medical Oncology’s Virtual Congress in September, where CheckMate -9ER has been selected for an oral presentation in the conference’s Presidential Symposium track. Working in tandem with Bristol Myers Squibb, the trial’s sponsor, and Ipsen and Takeda, our partners in cabozantinib’s global clinical development and commercialization, we’re quickly moving forward with the associated high-priority regulatory filings on a global basis. At the same time, the Exelixis commercial organization is well into their preparations for a potential launch in the United States."

Dr. Morrissey continued: "As we move forward on the next commercial growth opportunity for cabozantinib, we’re also moving quickly to evaluate its potential utility in additional disease settings. Based on the results from COSMIC-021, we and our collaboration partner Roche recently initiated the CONTACT clinical trial program, which consists of three global phase 3 pivotal trials of cabozantinib in combination with atezolizumab in metastatic non-small cell lung cancer, castration-resistant prostate cancer, and renal cell carcinoma. In addition, as a result of our internal efforts complemented by the work of our research partners, we remain on track to file up to three new Investigational New Drug applications by the end of this year, including a CDK7 inhibitor from our Aurigene collaboration, a tissue factor-targeting antibody-drug conjugate from our Iconic collaboration, as well as XL265, a TAM kinase-focused kinase inhibitor from our own laboratories. I’m proud of the commitment demonstrated by the entire Exelixis team to continue to drive our business forward during these difficult times. We look forward to providing updates on our continued progress throughout the second half of the year."
Second Quarter 2020 Financial Results

Total revenues for the quarter ended June 30, 2020 were $259.5 million, compared to $240.3 million for the comparable period in 2019.

Total revenues for the quarter ended June 30, 2020 included net product revenues of $178.7 million, compared to $193.7 million for the comparable period in 2019. The decrease in net product revenues was due to a decrease in sales volume, which was partially offset by an increase in the average net selling price. Net product revenues in the second quarter 2020 were negatively impacted by the COVID-19 pandemic and by an inventory build by wholesalers and end customers in the first quarter 2020, which generally reversed in the second quarter 2020.

Collaboration revenues, composed of license revenues and collaboration services revenues, were $80.7 million for the quarter ended June 30, 2020, compared to $46.6 million for the comparable period in 2019. The increase in collaboration revenues was primarily related to an increase in the recognition of milestone related revenues, increases in development cost reimbursements earned, and higher royalty revenues for the sales of cabozantinib outside of the U.S. generated by Exelixis’ collaboration partner, Ipsen Pharma SAS (Ipsen).

Research and development expenses for the quarter ended June 30, 2020 were $114.9 million, compared to $81.9 million for the comparable period in 2019. The increase in research and development expenses was primarily related to increases in clinical trial costs and personnel expenses, which were partially offset by decreases in license and other collaboration costs. The increase in clinical trial costs was primarily due to costs associated with expanding clinical trial programs for cabozantinib, which includes COSMIC-312, COSMIC-313, CONTACT-02 and COSMIC-021. The increase in personnel expenses was primarily due to an increase in headcount to support Exelixis’ expanding discovery and development efforts. Decreases in license and other collaboration costs were primarily due to upfront license fee payments made in the comparable period of 2019, offset by an increase in research funding commitments in this quarter.

Selling, general and administrative expenses for the quarter ended June 30, 2020 were $59.8 million, compared to $58.8 million for the comparable period in 2019. The increase in selling, general and administrative expenses was primarily related to increases in personnel expenses, which was offset by decreases in marketing costs. The increase in personnel expenses was primarily due to an increase in administrative headcount to support Exelixis’ commercial and research and development organizations.

Provision for income taxes for the quarter ended June 30, 2020 decreased to $13.9 million, compared to $20.7 million for the comparable period in 2019, primarily due to a decrease in pre-tax income.

GAAP net income for the quarter ended June 30, 2020 was $66.8 million, or $0.22 per share, basic and $0.21 per share, diluted, compared to GAAP net income of $79.0 million, or $0.26 per share, basic and $0.25 per share, diluted, for the comparable period in 2019. The decrease in GAAP net income was primarily related to an increase in research and development expenses and a decrease in net product revenues, which were partially offset by an increase in collaboration revenues.

Non-GAAP net income for the quarter ended June 30, 2020 was $79.4 million, or $0.26 per share, basic and $0.25 per share, diluted, compared to non-GAAP net income of $90.7 million, or $0.30 per share, basic and $0.29 per share, diluted, for the comparable period in 2019. Non-GAAP net income excludes stock-based compensation, adjusted for the related income tax effect.

Cash and investments were $1.5 billion at June 30, 2020, compared to $1.4 billion at December 31, 2019.
Non-GAAP Financial Measures

To supplement Exelixis’ financial results presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP), Exelixis presents non-GAAP net income (and the related per share measures), which excludes from GAAP net income (and the related per share measures) stock-based compensation expense, adjusted for the related income tax effect for all periods presented.

Exelixis believes that the presentation of these non-GAAP financial measures provides useful supplementary information to, and facilitates additional analysis by, investors. In particular, Exelixis believes that these non-GAAP financial measures, when considered together with its financial information prepared in accordance with GAAP, can enhance investors’ and analysts’ ability to meaningfully compare Exelixis’ results from period to period, and to identify operating trends in Exelixis’ business. Exelixis has excluded stock-based compensation expense, adjusted for the related income tax effect, because it is a non-cash item that may vary significantly from period to period as a result of changes not directly or immediately related to the operational performance for the periods presented. Exelixis also regularly uses these non-GAAP financial measures internally to understand, manage and evaluate its business and to make operating decisions.

These non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. Exelixis encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP financial information and the reconciliation between these presentations, to more fully understand Exelixis’ business. Reconciliations between GAAP and non-GAAP results are presented in the tables of this release.
Cabozantinib Highlights

Cabozantinib Franchise Net Product Revenues and Royalties. Net product revenues generated by the cabozantinib franchise in the U.S. were $178.7 million during the second quarter of 2020, with net product revenues of $173.6 million from CABOMETYX (cabozantinib) and $5.1 million from COMETRIQ (cabozantinib). Based upon cabozantinib-related revenues generated by Exelixis’ partner Ipsen in the second quarter of 2020, Exelixis earned $16.3 million in royalty revenues.

Positive Top-line Results from Pivotal Phase 3 CheckMate -9ER Trial Evaluating Nivolumab in Combination with Cabozantinib in Previously Untreated Advanced Renal Cell Carcinoma (RCC). In April 2020, Exelixis and
BMS announced that CheckMate -9ER, the phase 3 pivotal trial evaluating nivolumab in combination with cabozantinib compared to sunitinib in previously untreated advanced or metastatic RCC, met its primary endpoint of progression-free survival (PFS) at final analysis, as well as the secondary endpoints of overall survival (OS) at a pre-specified interim analysis, and objective response rate. This preliminary analysis of data showed a favorable safety profile for the combination of a 40 mg dose of cabozantinib with nivolumab.

Cabozantinib Data Presentations at the European Society for Medical Oncology Virtual Congress 2020 (ESMO 2020), including Oral Presentation of CheckMate -9ER in the Meeting’s Presidential Symposium II. In September 2020, cabozantinib will be the subject of multiple presentations at ESMO (Free ESMO Whitepaper) 2020 (September 19-21). Notably, detailed results from CheckMate -9ER will be the subject of an oral presentation during the meeting’s Presidential Symposium II. In addition, data from two cohorts of COSMIC-021 evaluating cabozantinib in combination with atezolizumab, expansion cohort 1 in first-line advanced clear cell RCC and cohort 10 in non-clear cell RCC, will be presented during ESMO (Free ESMO Whitepaper) 2020 as an oral and a poster presentation, respectively.

Initiation of Three Phase 3 Pivotal Trials of Cabozantinib in Combination with Atezolizumab in Previously Treated Metastatic Non-Small Cell Lung Cancer (NSCLC), Castration-Resistant Prostate Cancer (CRPC) and RCC. In June and July 2020, Exelixis announced the initiation of CONTACT-01, CONTACT-02 and CONTACT-03, three global phase 3 pivotal trials of cabozantinib in combination with atezolizumab in patients with previously treated, metastatic NSCLC, CRPC and RCC, respectively. The CONTACT program is part of a joint clinical research collaboration between Exelixis and F. Hoffmann-La Roche Ltd.

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CONTACT-01 is evaluating the combination of cabozantinib and atezolizumab in patients with metastatic NSCLC who have been previously treated with an immune checkpoint inhibitor (ICI) and platinum-containing chemotherapy.
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CONTACT-02 is evaluating the combination of cabozantinib and atezolizumab in patients with metastatic CRPC who have been previously treated with one novel hormonal therapy.
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CONTACT-03 is evaluating the combination of cabozantinib and atezolizumab in patients with metastatic RCC who progressed during or following treatment with an ICI as the immediate preceding therapy.

Completion of Patient Enrollment for COSMIC-312 Phase 3 Pivotal Trial in Previously Untreated Hepatocellular Carcinoma (HCC). Today, Exelixis is announcing the completion of patient enrollment in COSMIC-312, a global phase 3 pivotal trial of cabozantinib in combination with atezolizumab versus sorafenib in previously untreated advanced HCC, providing the patient population for the event-driven analyses of the study’s endpoints. Separately, patient enrollment remains open in China with a focus on enrolling the necessary patient number to enable local registration, if supported by the clinical data. The co-primary endpoints of the trial are PFS and OS for the combination of cabozantinib and atezolizumab versus sorafenib. Based on current event rates, Exelixis anticipates announcing top-line results in the first half of 2021.

Announcement of Results from Phase 1b COSMIC-021 Trial of Cabozantinib in Combination with Atezolizumab in Multiple Advanced Solid Tumor Types. In May 2020, Exelixis announced encouraging results from three expansion cohorts of the phase 1b COSMIC-021 trial evaluating the combination of cabozantinib and atezolizumab in patients with metastatic NSCLC, CRPC and urothelial carcinoma. These data were subsequently presented during the 2020 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Virtual Scientific Program.

Completion of Patient Enrollment for EXAMINER Phase 4 Trial of Cabozantinib in Metastatic Medullary Thyroid Cancer. In July 2020, Exelixis completed patient enrollment in EXAMINER, the phase 4 trial evaluating the safety and efficacy of the 60 mg tablet formulation of cabozantinib compared with the 140 mg capsule formulation, which is marketed as COMETRIQ, for the treatment of patients with progressive, metastatic medullary thyroid cancer. EXAMINER is a post-marketing requirement from the U.S. Food and Drug Administration (FDA) and the
European Commission. The trial was designed to enroll up to 250 patients, and top-line results from the trial are anticipated later this year.

Corporate Updates

Takeda Pharmaceutical Company Limited (Takeda) Records First Commercial Sale of CABOMETYX in Japan. In March 2020, Takeda, Exelixis’ partner responsible for the clinical development and commercialization of CABOMETYX in Japan, received approval from the Japanese Ministry of Health, Labour and Welfare to manufacture and market CABOMETYX as a treatment for patients with curatively unresectable or metastatic RCC. During the second quarter of 2020, Takeda launched CABOMETYX in Japan, triggering a $31.0 million milestone payment to Exelixis from Takeda upon the first commercial sale of CABOMETYX, of which $23.7 million was recognized as revenue in this quarter.

Exelixis Files Second Complaint in Patent Infringement Lawsuit against MSN Pharmaceuticals, Inc. (MSN). In May 2020, Exelixis filed a second complaint in the company’s patent infringement lawsuit against MSN, following receipt of notice from MSN that it had amended its Abbreviated New Drug Application (ANDA), originally filed with the FDA in September 2019, to add two previously-unasserted CABOMETYX Orange Book-listed patents: U.S. Patent No. 7,579,473, the composition of matter patent, and U.S. Patent No. 8,497,284, a method of use patent. Exelixis is seeking, among other relief, an order that the effective date of any FDA approval of the ANDA would be a date no earlier than the expiration of all of U.S. Patent No. 7,579,473, U.S. Patent No. 8,497,284, and U.S. Patent No. 8,877,776, the latest of which expires on October 8, 2030, and equitable relief enjoining MSN from infringing this patent.

FDA Approves Tecentriq (Atezolizumab) Plus COTELLIC (Cobimetinib) and Zelboraf (Vemurafenib) for Previously Untreated BRAF V600 Mutation-Positive Advanced Melanoma. In July 2020, the FDA approved the supplemental Biologics License Application (sBLA) submitted by Genentech, Inc. (a member of the Roche Group) (Genentech), for Tecentriq plus COTELLIC and Zelboraf for the treatment of BRAF V600-mutation positive advanced melanoma in previously untreated patients. The approval is based on positive results from the phase 3 IMspire150 study, which demonstrated that adding Tecentriq to COTELLIC and Zelboraf helped to reduce the risk of disease worsening or death, compared to placebo plus COTELLIC and Zelboraf. This is the second FDA approval for a regimen including COTELLIC, which was discovered by Exelixis and is now being developed by Genentech as part of a worldwide collaboration agreement between the two companies.

Basis of Presentation

Exelixis has adopted a 52- or 53-week fiscal year that generally ends on the Friday closest to December 31st. For convenience, references in this press release as of and for the fiscal periods ended July 3, 2020, January 3, 2020 and June 28, 2019 are indicated as being as of and for the periods ended June 30, 2020, December 31, 2019 and June 30, 2019, respectively.

Conference Call and Webcast

Exelixis management will discuss the company’s financial results for the second quarter of 2020 and provide a general business update during a conference call beginning at 5:30 p.m. EDT / 2:30 p.m. PDT today, Thursday, August 6, 2020.

To access the webcast link, log onto www.exelixis.com and proceed to the News & Events / Event Calendar page under the Investors & Media heading. Please connect to the company’s website at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to listen to the
webcast. Alternatively, please call 855-793-2457 (domestic) or 631-485-4921 (international) and provide the conference call passcode 6548897 to join by phone.

A telephone replay will be available until 8:00 p.m. EDT on August 8, 2020. Access numbers for the telephone replay are: 855-859-2056 (domestic) and 404-537-3406 (international); the passcode is 6548897. A webcast replay will also be archived on www.exelixis.com for one year.

On August 6, 2020 Illumina, Inc. (NASDAQ: ILMN) reported its financial results for the second quarter of fiscal year 2020 (Press release, Illumina, AUG 6, 2020, View Source [SID1234563084]).

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Second quarter 2020 results reflect the impact of the global COVID-19 pandemic:

•Revenue of $633 million, a 25% decrease compared to $838 million in the second quarter of 2019
•GAAP net income attributable to Illumina stockholders for the quarter of $47 million, or $0.32 per diluted share, compared to $296 million, or $1.99 per diluted share, for the second quarter of 2019
•Non-GAAP net income attributable to Illumina stockholders for the quarter of $92 million, or $0.62 per diluted share, compared to $200 million, or $1.35 per diluted share, for the second quarter of 2019. Non-GAAP net income excludes discrete tax expenses and net gains from mark-to-market adjustments on our strategic investments, primarily from our marketable equity securities (see the "Reconciliation Between GAAP and Non-GAAP Net Income Attributable to Illumina Stockholders" table for a reconciliation of these GAAP and non-GAAP financial measures)
•Cash flow from operations of $240 million compared to $143 million in the second quarter of 2019. Cash flow from operations for the second quarter of 2019 included an $84 million payment of the accreted debt discount related to the conversion of our 2019 Notes
•Free cash flow (cash flow from operations less capital expenditures) of $202 million for the quarter compared to $96 million in the second quarter of 2019. Free cash flow for the second quarter of 2019 included the convertible notes payment, referenced above

Gross margin in the second quarter of 2020 was 67.7% compared to 68.4% in the prior year period. Excluding amortization of acquired intangible assets and the net impact from payroll credits and expenses related to COVID-19, non-GAAP gross margin was 68.6% for the second quarter of 2020 compared to 69.5% in the prior year period.

Research and development (R&D) expenses for the second quarter of 2020 were $155 million compared to $166 million in the prior year period. Excluding payroll credits related to COVID-19, non-GAAP R&D expenses as a percentage of revenue were 24.7% compared to 19.8% in the prior year period.

Selling, general and administrative (SG&A) expenses for the second quarter of 2020 were $177 million compared to $202 million in the prior year period. Excluding acquisition-related expenses, restructuring charges, and the net impact from payroll credits and expenses related to COVID-19, non-GAAP SG&A expenses as a percentage of revenue were 28.1% compared to 23.1% in the prior year period.

Depreciation and amortization expenses were $46 million and capital expenditures for free cash flow purposes were $38 million during the second quarter of 2020. At the close of the quarter, the company held $3.3 billion in cash, cash equivalents and short-term investments, compared to $3.4 billion as of December 29, 2019.

"As expected, the second quarter was significantly impacted by pandemic-related disruption in our customers’ operations and was particularly challenging for many of our research customers who remain closed or operating at limited scale," said Francis deSouza, President and CEO. "It is clear that the role of genomics in infectious disease will continue to grow through and beyond this pandemic."

Updates since our last earnings release:

•Launched TruSight software to accelerate the identification of rare genetic diseases through whole genome sequencing
•Received an Emergency Use Authorization from the US FDA for COVIDSeq, the first sequencing-based COVID-19 diagnostic test
•Acquired BlueBee and Enancio to lower data storage costs and accelerate data interpretation
•Accepted seven genomic startups to Illumina Accelerator’s first global cohort, with 3 in Cambridge, UK and 4 in San Francisco, to build breakthrough genomic technologies
•Repurchased approximately $143 million of common stock in the second quarter and $420 million remains available for repurchase under our current plan
•Welcomed Dr. Alex Aravanis to lead research and development efforts as CTO and appointed Mostafa Ronaghi to lead entrepreneurial development

Financial outlook and guidance

As previously announced, Illumina has withdrawn its fiscal 2020 full year revenue and earnings per share guidance due to the uncertainties around the severity and duration of the COVID-19 pandemic.

Quarterly conference call information

The conference call will begin at 2:00 pm Pacific Time (5:00 pm Eastern Time) on Thursday, August 6, 2020. Interested parties may access the live teleconference through the Investor Info section of Illumina’s website under the "Company" tab at www.illumina.com. Alternatively, individuals can access the call by dialing 1 (866) 211-4597 or 1 (647) 689-6853 outside North America, both with conference ID 4194447.

A replay of the conference call will be posted on Illumina’s website after the event and will be available for at least 30 days following.

Statement regarding use of non-GAAP financial measures

The company reports non-GAAP results for diluted net income per share, net income, gross margins, operating expenses, operating margins, other income, and free cash flow in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. The company’s financial measures under GAAP include substantial charges such as amortization of acquired intangible assets, non-cash interest expense associated with the company’s convertible debt instruments that may be settled in cash, and others that are listed in the itemized reconciliations between GAAP and non-GAAP financial measures included in this press release. Management has excluded the effects of these items in non-GAAP measures to assist investors in analyzing and assessing past and future operating performance. Additionally, non-GAAP net income attributable to Illumina stockholders and diluted earnings per share attributable to Illumina stockholders are key components of the financial metrics utilized by the company’s board of directors to measure, in part, management’s performance and determine significant elements of management’s compensation.

The company encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand its business. Reconciliations between GAAP and non-GAAP results are presented in the tables of this release.

On August 6, 2020 ardant Health, Inc. (Nasdaq: GH), a leading precision oncology company focused on helping conquer cancer globally through use of its proprietary blood tests, vast data sets and advanced analytics, reported financial results for the quarter ended June 30, 2020 (Press release, Guardant Health, AUG 6, 2020, View Source [SID1234563083]).
Recent Highlights
•Revenue of $66.3 million for the second quarter of 2020, an increase of 23% over the corresponding period of 2019
◦Precision oncology revenue of $51.0 million, an increase of 21% over the corresponding period of 2019
◦Development services revenue of $15.3 million, an increase of 29% over the corresponding period of 2019
•Reported 13,694 tests to clinical customers and 2,805 tests to biopharmaceutical customers in the second quarter of 2020, representing an increase of 15% and a decrease of 47%, respectively, over the second quarter of 2019
•Presented data from a new patient cohort that demonstrated that its LUNAR-2 liquid assay achieved 90% sensitivity and 94% specificity in detecting early-stage colorectal cancer
•Launched GuardantINFORM, a real-world clinical-genomic platform to accelerate precision oncology drug development
•Announced two strategic collaborations to develop the Guardant360 assay as a companion diagnostic for Janssen Biotech’s amivantamab in non-small-cell lung carcinoma, and expanding to a new indication, for Radius Health’s elacestrant in breast cancer
•Strengthened financial position with an underwritten public offering raising $354.6 million in net proceeds, ending the second quarter with $1.1 billion cash, cash equivalents and marketable securities
"During this challenging time, our team at Guardant Health successfully executed across our business and has never wavered from our commitment to serve patients," said Helmy Eltoukhy, PhD, co-founder and CEO. "As we look to the second half of this year, despite the ongoing pandemic, I am more confident than ever in the strength and resilience of our team, the promise of the Guardant platform and the significant opportunity ahead to transform patient care."
Second Quarter 2020 Financial Results
Revenue was $66.3 million for the three months ended June 30, 2020, a 23% increase from $54.0 million for the three months ended June 30, 2019. Precision oncology revenue grew 21% driven predominantly by an increase in average selling price. There were 13,694 clinical tests and 2,805 biopharmaceutical tests performed during the second quarter of 2020. Development services revenue increased 29% primarily related to the timing of project related milestones for companion diagnostic development programs.
Gross profit, or total revenue less cost of precision oncology testing and cost of development services, was $43.9 million for the second quarter of 2020, an increase of $6.8 million from $37.1 million for the corresponding prior year period. Gross margin, or gross profit divided by total revenue, was 66%, as compared to 69% for the corresponding prior year period.
Operating expenses were $98.5 million for the second quarter of 2020, as compared to $52.4 million for the corresponding prior year period, an increase of 88%.
Net loss attributable to Guardant Health, Inc. common stockholders was $54.6 million for the second quarter of 2020, as compared to $11.6 million for the corresponding prior year period. Net loss per share attributable to Guardant Health, Inc. common stockholders was $0.57 for the second quarter of 2020, as compared to $0.13 for the corresponding prior year period.
Cash, cash equivalents and marketable securities were $1.1 billion as of June 30, 2020. This includes approximately $354.6 million of net proceeds from Guardant Health’s follow-on public offering which closed in early June.
2020 Guidance
Guardant Health is not providing 2020 financial guidance due to the continued uncertainties from the impact of COVID-19.
Webcast and Conference Call Information
Guardant Health will host a conference call to discuss the second quarter 2020 financial results after market close on Thursday, August 6, 2020 at 1:30 PM Pacific Time / 4:30 PM Eastern Time. A webcast of the conference call can be accessed at View Source The webcast will be archived and available for replay for at least 90 days after the event.

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

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Non-GAAP Measure
We believe that the exclusion of certain income and expenses in calculating non-GAAP Adjusted EBITDA can provide a useful measure for investors when comparing our period-to-period core operating results, and when comparing those same results to that published by our peers. To derive Adjusted EBITDA, we remove from GAAP results the impact of income (expenses) attributable to material non-cash items, specifically stock-based compensation and fair value remeasurements due to the subjectivity, management judgment, and market fluctuations involved around these amounts. We exclude certain other items because we believe that these income (expenses) do not reflect expected future operating expenses. Additionally, certain items are inconsistent in amounts and frequency, making it difficult to perform a meaningful evaluation of our current or past operating performance.
This non-GAAP financial measure is not intended to be considered in isolation from, as substitute for, or as superior to, the corresponding financial measure prepared in accordance with GAAP. There are limitations inherent in non-GAAP financial measures because they exclude charges and credits that are required to be included in a GAAP presentation, and do not present the full measure of our recorded costs against its revenue. In addition, our definition of the non-GAAP financial measures may differ from non-GAAP measures used by other companies.
Definition of Non-GAAP Adjusted EBITDA
"Adjusted EBITDA" is defined as net loss attributable to Guardant Health, Inc. common stockholders before: (i) interest income,(ii) interest expense (iii) provision for (benefit from) income taxes, (iv) depreciation and amortization expense, (v) other (income) expense, net, (vi) stock-based compensation expense, (vii) adjustments relating to non-controlling interest and contingent consideration and, if applicable in a reporting period, and (viii) acquisition-related expenses, and other non-recurring items.