On November 9, 2020 Athersys, Inc. (NASDAQ: ATHX) reported its financial results for the three months ended September 30, 2020 and provided a corporate update (Press release, Athersys, NOV 9, 2020, View Source [SID1234570382]).

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Highlights of the third quarter of 2020 and recent events include:

Received Regenerative Medicine Advanced Therapy (RMAT) designation for MultiStem from the U.S. Food and Drug Administration (FDA) for the treatment of acute respiratory distress syndrome (ARDS), a designation enabling additional interactions with the FDA that are focused on expediting development;
Commenced patient screening for the Phase 2 clinical trial led by The University of Texas Health Science Center at Houston (UTHealth) evaluating MultiStem Administration for Trauma Related Inflammation and Complications (MATRICS-1) in patients at Memorial Hermann-Texas Medical Center, a leading Level 1 Trauma center;
Further advanced the MACOVIA Phase 2/3 trial evaluating MultiStem administration to patients with COVID-19 induced ARDS and advanced preparations to potentially expand the study to include a broader range of patients with ARDS, including from influenza and other pathogens;
Advanced the MASTERS-2 ischemic stroke study, reactivating all clinical sites previously impacted by COVID-19 operational disruptions, and adding new sites to the study;
Received notification that HEALIOS K.K. (Healios), our Japanese partner, completed enrollment of its COVID-19 induced ARDS patient cohort in its ONE-BRIDGE study. Healios has previously stated it intends to complete enrollment of the entire ONE-BRIDGE study and the TREASURE ischemic stroke study by around the end of the year;
Advanced our partnering negotiations regarding MultiStem for potential commercialization in Europe and other regions of interest;
Continued key initiatives for establishing commercialization readiness, including supply chain and logistics, process development, manufacturing, branding and other key areas;
Recognized net loss of $22.5 million, or $0.11 net loss per share, for the quarter ended September 30, 2020; and
Ended the third quarter with $61.7 million of cash and cash equivalents.
"Despite the continuing chaos created by the ongoing COVID-19 pandemic, we made excellent progress this quarter. Our clinical programs and ongoing partnering negotiations continue to advance, and our efforts to establish commercial readiness in several key areas have also made good progress," commented Dr. Gil Van Bokkelen, Chairman and CEO of Athersys. "We have maintained a strong financial position while also continuing to build key capabilities that would support our planned transition into commercialization following regulatory approval of our innovative therapies.

"Completing a high value partnership for Europe and potentially other geographies is an important near-term priority, and we are focused on achieving that goal, which will be a key event in the continued evolution of the company," concluded Dr. Van Bokkelen.

Third Quarter Results

There were revenues of $0.1 million for the three months ended September 30, 2020 compared to revenues of negative $0.4 million for the three months ended September 30, 2019, primarily related to our collaboration with Healios. Our collaboration revenues currently fluctuate from period to period based on the delivery of goods and services under our arrangement with Healios.

Research and development expenses increased to $18.5 million for the three months ended September 30, 2020 from $8.9 million for the comparable period in 2019. The $9.6 million net increase is primarily associated with increases in clinical trial and manufacturing process development costs of $6.9 million, research supplies of $1.4 million, and personnel and stock compensation costs of $0.9 million. Our clinical development, clinical manufacturing and manufacturing process development expenses vary over time based on the timing and stage of clinical trials underway, manufacturing campaigns for clinical trials and manufacturing process development projects.

General and administrative expenses increased to $3.7 million for the three months ended September 30, 2020 compared to $3.0 million in the comparable period in 2019. The $0.7 million increase was primarily due to increased personnel and stock compensation costs, outside services and consulting costs.

Net loss for the third quarter of 2020 was $22.5 million compared to a net loss of $12.0 million in the third quarter of 2019. The difference primarily results from the above variances.

During the nine months ended September 30, 2020, net cash used in operating activities was $44.5 million compared to $25.2 million in the nine months ended September 30, 2019. At September 30, 2020, we had $61.7 million in cash and cash equivalents, compared to $35.0 million at December 31, 2019.

Conference Call

Gil Van Bokkelen, Chairman and Chief Executive Officer, Ivor Macleod, Chief Financial Officer, and Karen Hunady, Director of Corporate Communications and Investor Relations will host a conference call today to review the results as follows:

Date

November 9, 2020

Time

4:30 p.m. (Eastern Time)

Live webcast registration

Webcast link

Phone registration

View Source

We encourage shareholders to listen using the webcast link above. If you would like to dial in using the phone to ask a question, please register for the conference call ahead of time using the call registration link above. Once registered, you will receive the toll-free number, a direct entry passcode and a registrant ID.

On November 9, 2020 Merck (NYSE: MRK), known as MSD outside the United States and Canada, reported that it will be stopping KEYNOTE-598, a Phase 3 trial investigating KEYTRUDA, Merck’s anti-PD-1 therapy, in combination with ipilimumab (Yervoy), compared with KEYTRUDA monotherapy, for the first-line treatment of patients with metastatic non-small cell lung cancer (NSCLC) whose tumors express PD-L1 (tumor proportion score [TPS] ≥50%) with no EGFR or ALK genomic tumor aberrations (Press release, Merck & Co, NOV 9, 2020, View Source;/?feedref=JjAwJuNHiystnCoBq_hl-SZsvSFSeS2k6e-jDETKtk7rEQumBjqILHhqiwHg7GoJnkvYMqDDYxFrLs-oQ2BHQ-mJCMFkCosC_NGzuJ8TW18j0KvNpL5ik-rnXyj1_o5vU-QF2vCj0ELWlPt_oGwViA== [SID1234570381]). Merck is discontinuing the study following the recommendation of an independent Data Monitoring Committee (DMC), which determined the benefit/risk profile of the combination did not support continuing the trial. At an interim analysis, the combination of KEYTRUDA and ipilimumab showed no incremental benefit in overall survival (OS) or progression-free survival (PFS), the study’s dual primary endpoints, compared with KEYTRUDA alone and crossed futility boundaries. No new safety signals for KEYTRUDA monotherapy were observed, however the combination of KEYTRUDA and ipilimumab was associated with a higher incidence of grade 3-5 adverse events (AEs), serious AEs, and AEs leading to discontinuation or death, compared with KEYTRUDA monotherapy. Merck will inform study investigators of the recommendation from the DMC and the DMC is advising that patients in the study discontinue treatment with ipilimumab/placebo. Data from this study will be submitted for presentation at an upcoming scientific congress and communicated to regulatory agencies.

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"We conducted KEYNOTE-598 in order to explicitly explore whether combining our anti-PD-1 therapy, KEYTRUDA, with ipilimumab provided additional benefits beyond treatment with KEYTRUDA alone in the metastatic non-small cell lung cancer setting," said Dr. Roy Baynes, senior vice president and head of global clinical development, chief medical officer, Merck Research Laboratories. "It is very clear that in this study, the addition of ipilimumab did not add clinical benefit but did add toxicity. KEYTRUDA monotherapy remains a standard of care for the treatment of certain patients with metastatic non-small cell lung cancer whose tumors express PD-L1."

While the combination of an anti-PD-1 therapy plus ipilimumab has been approved in certain indications, studies supporting these approvals have, for the most part, not compared the combination directly with anti-PD-1 monotherapy. Bristol Myers Squibb has reported topline results of CheckMate-915, a Phase 3 study in adjuvant melanoma that directly compared treatment with ipilimumab in combination with an anti-PD-1 therapy versus the anti-PD-1 therapy alone. In two separate news releases issued over the last year, the company announced the study did not meet its co-primary endpoints in the all-comer population or in patients whose tumors expressed PD-L1 <1%. These data have not yet been presented.

Merck has an extensive clinical development program in lung cancer and is advancing multiple registration-enabling studies with KEYTRUDA in combination with other treatments and as monotherapy. The lung program is evaluating KEYTRUDA across all stages of disease and lines of therapy in over 200 trials with more than 10,000 patients.

About KEYNOTE-598

KEYNOTE-598 (ClinicalTrials.gov, NCT03302234) is a randomized, double-blind, Phase 3 trial investigating KEYTRUDA in combination with ipilimumab compared to KEYTRUDA monotherapy for the first-line treatment of patients with metastatic NSCLC whose tumors express PD‑L1 (TPS ≥50%) with no EGFR or ALK genomic tumor aberrations. The dual primary endpoints are OS and PFS. Secondary endpoints include objective response rate, duration of response and safety. The study enrolled 568 patients who were randomized (1:1) to receive:

KEYTRUDA (200 mg intravenously [IV] on Day 1 of each three-week cycle for up to 35 cycles) in combination with ipilimumab (1 mg/kg IV on Day 1 of each six-week cycle for up to 18 cycles); or
KEYTRUDA (200 mg IV on Day 1 of each three-week cycle for up to 35 cycles) in combination with placebo (IV on Day 1 of each six-week cycle for up to 18 cycles).
About Lung Cancer

Lung cancer, which forms in the tissues of the lungs, usually within cells lining the air passages, is the leading cause of cancer death worldwide. Each year, more people die of lung cancer than die of colon and breast cancers combined. The two main types of lung cancer are non-small cell and small cell. Non-small cell lung cancer (NSCLC) is the most common type of lung cancer, accounting for about 85% of all cases. Small cell lung cancer (SCLC) accounts for about 10% to 15% of all lung cancers. Before 2014, the five-year survival rate for patients diagnosed in the U.S. with NSCLC and SCLC was estimated to be 5% and 6%, respectively.

About KEYTRUDA (pembrolizumab) Injection, 100 mg

KEYTRUDA is an anti-PD-1 therapy that works by increasing the ability of the body’s immune system to help detect and fight tumor cells. KEYTRUDA is a humanized monoclonal antibody that blocks the interaction between PD-1 and its ligands, PD-L1 and PD-L2, thereby activating T lymphocytes which may affect both tumor cells and healthy cells.

Merck has the industry’s largest immuno-oncology clinical research program. There are currently more than 1,200 trials studying KEYTRUDA across a wide variety of cancers and treatment settings. The KEYTRUDA clinical program seeks to understand the role of KEYTRUDA across cancers and the factors that may predict a patient’s likelihood of benefitting from treatment with KEYTRUDA, including exploring several different biomarkers.

Selected KEYTRUDA (pembrolizumab) Indications

Melanoma

KEYTRUDA is indicated for the treatment of patients with unresectable or metastatic melanoma.

KEYTRUDA is indicated for the adjuvant treatment of patients with melanoma with involvement of lymph node(s) following complete resection.

Non-Small Cell Lung Cancer

KEYTRUDA, in combination with pemetrexed and platinum chemotherapy, is indicated for the first-line treatment of patients with metastatic nonsquamous non-small cell lung cancer (NSCLC), with no EGFR or ALK genomic tumor aberrations.

KEYTRUDA, in combination with carboplatin and either paclitaxel or paclitaxel protein-bound, is indicated for the first-line treatment of patients with metastatic squamous NSCLC.

KEYTRUDA, as a single agent, is indicated for the first-line treatment of patients with NSCLC expressing PD-L1 [tumor proportion score (TPS) ≥1%] as determined by an FDA-approved test, with no EGFR or ALK genomic tumor aberrations, and is stage III where patients are not candidates for surgical resection or definitive chemoradiation, or metastatic.

KEYTRUDA, as a single agent, is indicated for the treatment of patients with metastatic NSCLC whose tumors express PD-L1 (TPS ≥1%) as determined by an FDA-approved test, with disease progression on or after platinum-containing chemotherapy. Patients with EGFR or ALK genomic tumor aberrations should have disease progression on FDA-approved therapy for these aberrations prior to receiving KEYTRUDA.

Small Cell Lung Cancer

KEYTRUDA is indicated for the treatment of patients with metastatic small cell lung cancer (SCLC) with disease progression on or after platinum-based chemotherapy and at least 1 other prior line of therapy. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials.

Head and Neck Squamous Cell Cancer

KEYTRUDA, in combination with platinum and fluorouracil (FU), is indicated for the first-line treatment of patients with metastatic or with unresectable, recurrent head and neck squamous cell carcinoma (HNSCC).

KEYTRUDA, as a single agent, is indicated for the first-line treatment of patients with metastatic or with unresectable, recurrent HNSCC whose tumors express PD-L1 [combined positive score (CPS) ≥1] as determined by an FDA-approved test.

KEYTRUDA, as a single agent, is indicated for the treatment of patients with recurrent or metastatic head and neck squamous cell carcinoma (HNSCC) with disease progression on or after platinum-containing chemotherapy.

Classical Hodgkin Lymphoma

KEYTRUDA is indicated for the treatment of adult patients with relapsed or refractory classical Hodgkin lymphoma (cHL).

KEYTRUDA is indicated for the treatment of pediatric patients with refractory cHL, or cHL that has relapsed after 2 or more lines of therapy.

Primary Mediastinal Large B-Cell Lymphoma

KEYTRUDA is indicated for the treatment of adult and pediatric patients with refractory primary mediastinal large B-cell lymphoma (PMBCL), or who have relapsed after 2 or more prior lines of therapy. KEYTRUDA is not recommended for treatment of patients with PMBCL who require urgent cytoreductive therapy.

Urothelial Carcinoma

KEYTRUDA is indicated for the treatment of patients with locally advanced or metastatic urothelial carcinoma (mUC) who are not eligible for cisplatin-containing chemotherapy and whose tumors express PD-L1 [combined positive score (CPS) ≥10], as determined by an FDA-approved test, or in patients who are not eligible for any platinum-containing chemotherapy regardless of PD-L1 status. This indication is approved under accelerated approval based on tumor response rate and duration of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials.

KEYTRUDA is indicated for the treatment of patients with locally advanced or metastatic urothelial carcinoma (mUC) who have disease progression during or following platinum-containing chemotherapy or within 12 months of neoadjuvant or adjuvant treatment with platinum-containing chemotherapy.

KEYTRUDA is indicated for the treatment of patients with Bacillus Calmette-Guerin (BCG)-unresponsive, high-risk, non-muscle invasive bladder cancer (NMIBC) with carcinoma in situ (CIS) with or without papillary tumors who are ineligible for or have elected not to undergo cystectomy.

Microsatellite Instability-High or Mismatch Repair Deficient Cancer

KEYTRUDA is indicated for the treatment of adult and pediatric patients with unresectable or metastatic microsatellite instability-high (MSI-H) or mismatch repair deficient (dMMR)

solid tumors that have progressed following prior treatment and who have no satisfactory alternative treatment options, or
colorectal cancer that has progressed following treatment with fluoropyrimidine, oxaliplatin, and irinotecan.
This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials. The safety and effectiveness of KEYTRUDA in pediatric patients with MSI-H central nervous system cancers have not been established.

Microsatellite Instability-High or Mismatch Repair Deficient Colorectal Cancer

KEYTRUDA is indicated for the first-line treatment of patients with unresectable or metastatic MSI-H or dMMR colorectal cancer (CRC).

Gastric Cancer

KEYTRUDA is indicated for the treatment of patients with recurrent locally advanced or metastatic gastric or gastroesophageal junction (GEJ) adenocarcinoma whose tumors express PD-L1 (CPS ≥1) as determined by an FDA-approved test, with disease progression on or after two or more prior lines of therapy including fluoropyrimidine- and platinum-containing chemotherapy and if appropriate, HER2/neu-targeted therapy. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials.

Esophageal Cancer

KEYTRUDA is indicated for the treatment of patients with recurrent locally advanced or metastatic squamous cell carcinoma of the esophagus whose tumors express PD-L1 (CPS ≥10) as determined by an FDA-approved test, with disease progression after one or more prior lines of systemic therapy.

Cervical Cancer

KEYTRUDA is indicated for the treatment of patients with recurrent or metastatic cervical cancer with disease progression on or after chemotherapy whose tumors express PD-L1 (CPS ≥1) as determined by an FDA-approved test. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials.

Hepatocellular Carcinoma

KEYTRUDA is indicated for the treatment of patients with hepatocellular carcinoma (HCC) who have been previously treated with sorafenib. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials.

Merkel Cell Carcinoma

KEYTRUDA is indicated for the treatment of adult and pediatric patients with recurrent locally advanced or metastatic Merkel cell carcinoma (MCC). This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials.

Renal Cell Carcinoma

KEYTRUDA, in combination with axitinib, is indicated for the first-line treatment of patients with advanced renal cell carcinoma (RCC).

Tumor Mutational Burden-High

KEYTRUDA is indicated for the treatment of adult and pediatric patients with unresectable or metastatic tumor mutational burden-high (TMB-H) [≥10 mutations/megabase (mut/Mb)] solid tumors, as determined by an FDA-approved test, that have progressed following prior treatment and who have no satisfactory alternative treatment options. This indication is approved under accelerated approval based on tumor response rate and durability of response. Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials. The safety and effectiveness of KEYTRUDA in pediatric patients with TMB-H central nervous system cancers have not been established.

Cutaneous Squamous Cell Carcinoma

KEYTRUDA is indicated for the treatment of patients with recurrent or metastatic cutaneous squamous cell carcinoma (cSCC) that is not curable by surgery or radiation.

Selected Important Safety Information for KEYTRUDA

Immune-Mediated Pneumonitis

KEYTRUDA can cause immune-mediated pneumonitis, including fatal cases. Pneumonitis occurred in 3.4% (94/2799) of patients with various cancers receiving KEYTRUDA, including Grade 1 (0.8%), 2 (1.3%), 3 (0.9%), 4 (0.3%), and 5 (0.1%). Pneumonitis occurred in 8.2% (65/790) of NSCLC patients receiving KEYTRUDA as a single agent, including Grades 3-4 in 3.2% of patients, and occurred more frequently in patients with a history of prior thoracic radiation (17%) compared to those without (7.7%). Pneumonitis occurred in 6% (18/300) of HNSCC patients receiving KEYTRUDA as a single agent, including Grades 3-5 in 1.6% of patients, and occurred in 5.4% (15/276) of patients receiving KEYTRUDA in combination with platinum and FU as first-line therapy for advanced disease, including Grades 3-5 in 1.5% of patients. Pneumonitis occurred in 8% (31/389) of patients with cHL receiving KEYTRUDA as a single agent, including Grades 3-4 in 2.3% of patients.

Monitor patients for signs and symptoms of pneumonitis. Evaluate suspected pneumonitis with radiographic imaging. Administer corticosteroids for Grade 2 or greater pneumonitis. Withhold KEYTRUDA for Grade 2; permanently discontinue KEYTRUDA for Grade 3 or 4 or recurrent Grade 2 pneumonitis.

Immune-Mediated Colitis

KEYTRUDA can cause immune-mediated colitis. Colitis occurred in 1.7% (48/2799) of patients receiving KEYTRUDA, including Grade 2 (0.4%), 3 (1.1%), and 4 (<0.1%). Monitor patients for signs and symptoms of colitis. Administer corticosteroids for Grade 2 or greater colitis. Withhold KEYTRUDA for Grade 2 or 3; permanently discontinue KEYTRUDA for Grade 4 colitis.

Immune-Mediated Hepatitis (KEYTRUDA) and Hepatotoxicity (KEYTRUDA in Combination With Axitinib)

Immune-Mediated Hepatitis

KEYTRUDA can cause immune-mediated hepatitis. Hepatitis occurred in 0.7% (19/2799) of patients receiving KEYTRUDA, including Grade 2 (0.1%), 3 (0.4%), and 4 (<0.1%). Monitor patients for changes in liver function. Administer corticosteroids for Grade 2 or greater hepatitis and, based on severity of liver enzyme elevations, withhold or discontinue KEYTRUDA.

Hepatotoxicity in Combination With Axitinib

KEYTRUDA in combination with axitinib can cause hepatic toxicity with higher than expected frequencies of Grades 3 and 4 ALT and AST elevations compared to KEYTRUDA alone. With the combination of KEYTRUDA and axitinib, Grades 3 and 4 increased ALT (20%) and increased AST (13%) were seen. Monitor liver enzymes before initiation of and periodically throughout treatment. Consider more frequent monitoring of liver enzymes as compared to when the drugs are administered as single agents. For elevated liver enzymes, interrupt KEYTRUDA and axitinib, and consider administering corticosteroids as needed.

Immune-Mediated Endocrinopathies

KEYTRUDA can cause adrenal insufficiency (primary and secondary), hypophysitis, thyroid disorders, and type 1 diabetes mellitus. Adrenal insufficiency occurred in 0.8% (22/2799) of patients, including Grade 2 (0.3%), 3 (0.3%), and 4 (<0.1%). Hypophysitis occurred in 0.6% (17/2799) of patients, including Grade 2 (0.2%), 3 (0.3%), and 4 (<0.1%). Hypothyroidism occurred in 8.5% (237/2799) of patients, including Grade 2 (6.2%) and 3 (0.1%). The incidence of new or worsening hypothyroidism was higher in 1185 patients with HNSCC (16%) receiving KEYTRUDA, as a single agent or in combination with platinum and FU, including Grade 3 (0.3%) hypothyroidism. The incidence of new or worsening hypothyroidism was higher in 389 patients with cHL (17%) receiving KEYTRUDA as a single agent, including Grade 1 (6.2%) and Grade 2 (10.8%) hypothyroidism. Hyperthyroidism occurred in 3.4% (96/2799) of patients, including Grade 2 (0.8%) and 3 (0.1%), and thyroiditis occurred in 0.6% (16/2799) of patients, including Grade 2 (0.3%). Type 1 diabetes mellitus, including diabetic ketoacidosis, occurred in 0.2% (6/2799) of patients.

Monitor patients for signs and symptoms of adrenal insufficiency, hypophysitis (including hypopituitarism), thyroid function (prior to and periodically during treatment), and hyperglycemia. For adrenal insufficiency or hypophysitis, administer corticosteroids and hormone replacement as clinically indicated. Withhold KEYTRUDA for Grade 2 adrenal insufficiency or hypophysitis and withhold or discontinue KEYTRUDA for Grade 3 or Grade 4 adrenal insufficiency or hypophysitis. Administer hormone replacement for hypothyroidism and manage hyperthyroidism with thionamides and beta-blockers as appropriate. Withhold or discontinue KEYTRUDA for Grade 3 or 4 hyperthyroidism. Administer insulin for type 1 diabetes, and withhold KEYTRUDA and administer antihyperglycemics in patients with severe hyperglycemia.

Immune-Mediated Nephritis and Renal Dysfunction

KEYTRUDA can cause immune-mediated nephritis. Nephritis occurred in 0.3% (9/2799) of patients receiving KEYTRUDA, including Grade 2 (0.1%), 3 (0.1%), and 4 (<0.1%) nephritis. Nephritis occurred in 1.7% (7/405) of patients receiving KEYTRUDA in combination with pemetrexed and platinum chemotherapy. Monitor patients for changes in renal function. Administer corticosteroids for Grade 2 or greater nephritis. Withhold KEYTRUDA for Grade 2; permanently discontinue for Grade 3 or 4 nephritis.

Immune-Mediated Skin Reactions

Immune-mediated rashes, including Stevens-Johnson syndrome (SJS), toxic epidermal necrolysis (TEN) (some cases with fatal outcome), exfoliative dermatitis, and bullous pemphigoid, can occur. Monitor patients for suspected severe skin reactions and based on the severity of the adverse reaction, withhold or permanently discontinue KEYTRUDA and administer corticosteroids. For signs or symptoms of SJS or TEN, withhold KEYTRUDA and refer the patient for specialized care for assessment and treatment. If SJS or TEN is confirmed, permanently discontinue KEYTRUDA.

Other Immune-Mediated Adverse Reactions

Immune-mediated adverse reactions, which may be severe or fatal, can occur in any organ system or tissue in patients receiving KEYTRUDA and may also occur after discontinuation of treatment. For suspected immune-mediated adverse reactions, ensure adequate evaluation to confirm etiology or exclude other causes. Based on the severity of the adverse reaction, withhold KEYTRUDA and administer corticosteroids. Upon improvement to Grade 1 or less, initiate corticosteroid taper and continue to taper over at least 1 month. Based on limited data from clinical studies in patients whose immune-related adverse reactions could not be controlled with corticosteroid use, administration of other systemic immunosuppressants can be considered. Resume KEYTRUDA when the adverse reaction remains at Grade 1 or less following corticosteroid taper. Permanently discontinue KEYTRUDA for any Grade 3 immune-mediated adverse reaction that recurs and for any life-threatening immune-mediated adverse reaction.

The following clinically significant immune-mediated adverse reactions occurred in less than 1% (unless otherwise indicated) of 2799 patients: arthritis (1.5%), uveitis, myositis, Guillain-Barré syndrome, myasthenia gravis, vasculitis, pancreatitis, hemolytic anemia, sarcoidosis, and encephalitis. In addition, myelitis and myocarditis were reported in other clinical trials, including classical Hodgkin lymphoma, and post-marketing use.

Treatment with KEYTRUDA may increase the risk of rejection in solid organ transplant recipients. Consider the benefit of treatment vs the risk of possible organ rejection in these patients.

Infusion-Related Reactions

KEYTRUDA can cause severe or life-threatening infusion-related reactions, including hypersensitivity and anaphylaxis, which have been reported in 0.2% (6/2799) of patients. Monitor patients for signs and symptoms of infusion-related reactions. For Grade 3 or 4 reactions, stop infusion and permanently discontinue KEYTRUDA.

Complications of Allogeneic Hematopoietic Stem Cell Transplantation (HSCT)

Fatal and other serious complications can occur in patients who receive allogeneic hematopoietic stem cell transplantation (HSCT) before or after being treated with a PD-1/PD-L1 blocking antibody. Transplant-related complications include hyperacute graft-versus-host disease (GVHD), acute GVHD, chronic GVHD, hepatic veno-occlusive disease (VOD) after reduced intensity conditioning, and steroid-requiring febrile syndrome (without an identified infectious cause). These complications may occur despite intervening therapy between PD-1/PD-L1 blockade and allogeneic HSCT. Follow patients closely for evidence of transplant-related complications and intervene promptly. Consider the benefit versus risk of treatment with a PD-1/PD-L1 blocking antibody prior to or after an allogeneic HSCT.

Increased Mortality in Patients With Multiple Myeloma

In trials in patients with multiple myeloma, the addition of KEYTRUDA to a thalidomide analogue plus dexamethasone resulted in increased mortality. Treatment of these patients with a PD-1 or PD-L1 blocking antibody in this combination is not recommended outside of controlled trials.

Embryofetal Toxicity

Based on its mechanism of action, KEYTRUDA can cause fetal harm when administered to a pregnant woman. Advise women of this potential risk. In females of reproductive potential, verify pregnancy status prior to initiating KEYTRUDA and advise them to use effective contraception during treatment and for 4 months after the last dose.

Adverse Reactions

In KEYNOTE-006, KEYTRUDA was discontinued due to adverse reactions in 9% of 555 patients with advanced melanoma; adverse reactions leading to permanent discontinuation in more than one patient were colitis (1.4%), autoimmune hepatitis (0.7%), allergic reaction (0.4%), polyneuropathy (0.4%), and cardiac failure (0.4%). The most common adverse reactions (≥20%) with KEYTRUDA were fatigue (28%), diarrhea (26%), rash (24%), and nausea (21%).

In KEYNOTE-002, KEYTRUDA was permanently discontinued due to adverse reactions in 12% of 357 patients with advanced melanoma; the most common (≥1%) were general physical health deterioration (1%), asthenia (1%), dyspnea (1%), pneumonitis (1%), and generalized edema (1%). The most common adverse reactions were fatigue (43%), pruritus (28%), rash (24%), constipation (22%), nausea (22%), diarrhea (20%), and decreased appetite (20%).

In KEYNOTE-054, KEYTRUDA was permanently discontinued due to adverse reactions in 14% of 509 patients; the most common (≥1%) were pneumonitis (1.4%), colitis (1.2%), and diarrhea (1%). Serious adverse reactions occurred in 25% of patients receiving KEYTRUDA. The most common adverse reaction (≥20%) with KEYTRUDA was diarrhea (28%).

In KEYNOTE-189, when KEYTRUDA was administered with pemetrexed and platinum chemotherapy in metastatic nonsquamous NSCLC, KEYTRUDA was discontinued due to adverse reactions in 20% of 405 patients. The most common adverse reactions resulting in permanent discontinuation of KEYTRUDA were pneumonitis (3%) and acute kidney injury (2%). The most common adverse reactions (≥20%) with KEYTRUDA were nausea (56%), fatigue (56%), constipation (35%), diarrhea (31%), decreased appetite (28%), rash (25%), vomiting (24%), cough (21%), dyspnea (21%), and pyrexia (20%).

In KEYNOTE-407, when KEYTRUDA was administered with carboplatin and either paclitaxel or paclitaxel protein-bound in metastatic squamous NSCLC, KEYTRUDA was discontinued due to adverse reactions in 15% of 101 patients. The most frequent serious adverse reactions reported in at least 2% of patients were febrile neutropenia, pneumonia, and urinary tract infection. Adverse reactions observed in KEYNOTE-407 were similar to those observed in KEYNOTE-189 with the exception that increased incidences of alopecia (47% vs 36%) and peripheral neuropathy (31% vs 25%) were observed in the KEYTRUDA and chemotherapy arm compared to the placebo and chemotherapy arm in KEYNOTE-407.

In KEYNOTE-042, KEYTRUDA was discontinued due to adverse reactions in 19% of 636 patients with advanced NSCLC; the most common were pneumonitis (3%), death due to unknown cause (1.6%), and pneumonia (1.4%). The most frequent serious adverse reactions reported in at least 2% of patients were pneumonia (7%), pneumonitis (3.9%), pulmonary embolism (2.4%), and pleural effusion (2.2%). The most common adverse reaction (≥20%) was fatigue (25%).

In KEYNOTE-010, KEYTRUDA monotherapy was discontinued due to adverse reactions in 8% of 682 patients with metastatic NSCLC; the most common was pneumonitis (1.8%). The most common adverse reactions (≥20%) were decreased appetite (25%), fatigue (25%), dyspnea (23%), and nausea (20%).

Adverse reactions occurring in patients with SCLC were similar to those occurring in patients with other solid tumors who received KEYTRUDA as a single agent.

In KEYNOTE-048, KEYTRUDA monotherapy was discontinued due to adverse events in 12% of 300 patients with HNSCC; the most common adverse reactions leading to permanent discontinuation were sepsis (1.7%) and pneumonia (1.3%). The most common adverse reactions (≥20%) were fatigue (33%), constipation (20%), and rash (20%).

In KEYNOTE-048, when KEYTRUDA was administered in combination with platinum (cisplatin or carboplatin) and FU chemotherapy, KEYTRUDA was discontinued due to adverse reactions in 16% of 276 patients with HNSCC. The most common adverse reactions resulting in permanent discontinuation of KEYTRUDA were pneumonia (2.5%), pneumonitis (1.8%), and septic shock (1.4%). The most common adverse reactions (≥20%) were nausea (51%), fatigue (49%), constipation (37%), vomiting (32%), mucosal inflammation (31%), diarrhea (29%), decreased appetite (29%), stomatitis (26%), and cough (22%).

In KEYNOTE-012, KEYTRUDA was discontinued due to adverse reactions in 17% of 192 patients with HNSCC. Serious adverse reactions occurred in 45% of patients. The most frequent serious adverse reactions reported in at least 2% of patients were pneumonia, dyspnea, confusional state, vomiting, pleural effusion, and respiratory failure. The most common adverse reactions (≥20%) were fatigue, decreased appetite, and dyspnea. Adverse reactions occurring in patients with HNSCC were generally similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy, with the exception of increased incidences of facial edema and new or worsening hypothyroidism.

In KEYNOTE-204, KEYTRUDA was discontinued due to adverse reactions in 14% of 148 patients with cHL. Serious adverse reactions occurred in 30% of patients; those ≥1% included pneumonitis, pneumonia, pyrexia, myocarditis, acute kidney injury, febrile neutropenia, and sepsis. Three patients died from causes other than disease progression. The most common adverse reactions (≥20%) were upper respiratory tract infection (41%), musculoskeletal pain (32%), diarrhea (22%), and pyrexia, fatigue, and cough (20% each).

In KEYNOTE-087, KEYTRUDA was discontinued due to adverse reactions in 5% of 210 patients with cHL. Serious adverse reactions occurred in 16% of patients; those ≥1% included pneumonia, pneumonitis, pyrexia, dyspnea, GVHD, and herpes zoster. Two patients died from causes other than disease progression; 1 from GVHD after subsequent allogeneic HSCT and 1 from septic shock. The most common adverse reactions (≥20%) were fatigue (26%), pyrexia (24%), cough (24%), musculoskeletal pain (21%), diarrhea (20%), and rash (20%).

In KEYNOTE-170, KEYTRUDA was discontinued due to adverse reactions in 8% of 53 patients with PMBCL. Serious adverse reactions occurred in 26% of patients and included arrhythmia (4%), cardiac tamponade (2%), myocardial infarction (2%), pericardial effusion (2%), and pericarditis (2%). Six (11%) patients died within 30 days of start of treatment. The most common adverse reactions (≥20%) were musculoskeletal pain (30%), upper respiratory tract infection and pyrexia (28% each), cough (26%), fatigue (23%), and dyspnea (21%).

In KEYNOTE-052, KEYTRUDA was discontinued due to adverse reactions in 11% of 370 patients with locally advanced or metastatic urothelial carcinoma. Serious adverse reactions occurred in 42% of patients; those ≥2% were urinary tract infection, hematuria, acute kidney injury, pneumonia, and urosepsis. The most common adverse reactions (≥20%) were fatigue (38%), musculoskeletal pain (24%), decreased appetite (22%), constipation (21%), rash (21%), and diarrhea (20%).

In KEYNOTE-045, KEYTRUDA was discontinued due to adverse reactions in 8% of 266 patients with locally advanced or metastatic urothelial carcinoma. The most common adverse reaction resulting in permanent discontinuation of KEYTRUDA was pneumonitis (1.9%). Serious adverse reactions occurred in 39% of KEYTRUDA-treated patients; those ≥2% were urinary tract infection, pneumonia, anemia, and pneumonitis. The most common adverse reactions (≥20%) in patients who received KEYTRUDA were fatigue (38%), musculoskeletal pain (32%), pruritus (23%), decreased appetite (21%), nausea (21%), and rash (20%).

In KEYNOTE-057, KEYTRUDA was discontinued due to adverse reactions in 11% of 148 patients with high-risk NMIBC. The most common adverse reaction resulting in permanent discontinuation of KEYTRUDA was pneumonitis (1.4%). Serious adverse reactions occurred in 28% of patients; those ≥2% were pneumonia (3%), cardiac ischemia (2%), colitis (2%), pulmonary embolism (2%), sepsis (2%), and urinary tract infection (2%). The most common adverse reactions (≥20%) were fatigue (29%), diarrhea (24%), and rash (24%).

Adverse reactions occurring in patients with MSI-H or dMMR CRC were similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy.

Adverse reactions occurring in patients with gastric cancer were similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy.

Adverse reactions occurring in patients with esophageal cancer were similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy.

In KEYNOTE-158, KEYTRUDA was discontinued due to adverse reactions in 8% of 98 patients with recurrent or metastatic cervical cancer. Serious adverse reactions occurred in 39% of patients receiving KEYTRUDA; the most frequent included anemia (7%), fistula, hemorrhage, and infections [except urinary tract infections] (4.1% each). The most common adverse reactions (≥20%) were fatigue (43%), musculoskeletal pain (27%), diarrhea (23%), pain and abdominal pain (22% each), and decreased appetite (21%).

Adverse reactions occurring in patients with hepatocellular carcinoma (HCC) were generally similar to those in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy, with the exception of increased incidences of ascites (8% Grades 3-4) and immune-mediated hepatitis (2.9%). Laboratory abnormalities (Grades 3-4) that occurred at a higher incidence were elevated AST (20%), ALT (9%), and hyperbilirubinemia (10%).

Among the 50 patients with MCC enrolled in study KEYNOTE-017, adverse reactions occurring in patients with MCC were generally similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy. Laboratory abnormalities (Grades 3-4) that occurred at a higher incidence were elevated AST (11%) and hyperglycemia (19%).

In KEYNOTE-426, when KEYTRUDA was administered in combination with axitinib, fatal adverse reactions occurred in 3.3% of 429 patients. Serious adverse reactions occurred in 40% of patients, the most frequent (≥1%) were hepatotoxicity (7%), diarrhea (4.2%), acute kidney injury (2.3%), dehydration (1%), and pneumonitis (1%). Permanent discontinuation due to an adverse reaction occurred in 31% of patients; KEYTRUDA only (13%), axitinib only (13%), and the combination (8%); the most common were hepatotoxicity (13%), diarrhea/colitis (1.9%), acute kidney injury (1.6%), and cerebrovascular accident (1.2%). The most common adverse reactions (≥20%) were diarrhea (56%), fatigue/asthenia (52%), hypertension (48%), hepatotoxicity (39%), hypothyroidism (35%), decreased appetite (30%), palmar-plantar erythrodysesthesia (28%), nausea (28%), stomatitis/mucosal inflammation (27%), dysphonia (25%), rash (25%), cough (21%), and constipation (21%).

Adverse reactions occurring in patients with TMB-H cancer were similar to those occurring in patients with other solid tumors who received KEYTRUDA as a single agent.

Adverse reactions occurring in patients with cSCC were similar to those occurring in patients with melanoma or NSCLC who received KEYTRUDA as a monotherapy.

Lactation

Because of the potential for serious adverse reactions in breastfed children, advise women not to breastfeed during treatment and for 4 months after the final dose.

Pediatric Use

In KEYNOTE-051, 161 pediatric patients (62 pediatric patients aged 6 months to younger than 12 years and 99 pediatric patients aged 12 years to 17 years) were administered KEYTRUDA 2 mg/kg every 3 weeks. The median duration of exposure was 2.1 months (range: 1 day to 24 months).

Adverse reactions that occurred at a ≥10% higher rate in pediatric patients when compared to adults were pyrexia (33%), vomiting (30%), leukopenia (30%), upper respiratory tract infection (29%), neutropenia (26%), headache (25%), and Grade 3 anemia (17%).

Merck’s Focus on Cancer

Our goal is to translate breakthrough science into innovative oncology medicines to help people with cancer worldwide. At Merck, the potential to bring new hope to people with cancer drives our purpose and supporting accessibility to our cancer medicines is our commitment. As part of our focus on cancer, Merck is committed to exploring the potential of immuno-oncology with one of the largest development programs in the industry across more than 30 tumor types. We also continue to strengthen our portfolio through strategic acquisitions and are prioritizing the development of several promising oncology candidates with the potential to improve the treatment of advanced cancers. For more information about our oncology clinical trials, visit www.merck.com/clinicaltrials.

On November 9, 2020 Castle Biosciences, Inc. (Nasdaq: CSTL), a skin cancer diagnostics company providing personalized genomic information to improve cancer treatment decisions, reported its financial results for the third quarter and nine months ended Sept. 30, 2020 (Press release, Castle Biosciences, NOV 9, 2020, View Source [SID1234570371]).

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"The Castle team made significant progress on our strategic growth initiatives in the third quarter," said Derek Maetzold, president and chief executive officer of Castle Biosciences. "We also returned to year-over-year volume growth in DecisionDx-Melanoma report volume, our current lead revenue driver, despite a reduction in melanoma diagnoses, which we believe is due to COVID-19. We are pleased to see, in October, the posting of the expanded local coverage determination (LCD) and accompanying billing and coding article for our DecisionDx-Melanoma test, with an effective date of November 22, 2020.

"As laid out at the beginning of 2020, we planned to launch our two near-term pipeline tests in the second half of the year. We successfully launched DecisionDx-SCC, our test for patients diagnosed with cutaneous squamous cell carcinoma (SCC) with one or more high-risk factors, on August 31, leveraging our strong, existing dermatologic sales channels. Through October, we have received 282 orders by 193 clinicians for this prognostic test, of which most were existing customers. Additionally, last week we launched our second new test of 2020, DecisionDx DiffDx-Melanoma, for use in patients with suspicious pigmented lesions. We estimate that combined, our three commercially available skin cancer products, DecisionDx-Melanoma, DecisionDx-SCC and DecisionDx DiffDx-Melanoma, have a total addressable U.S. market of approximately $2.0 billion.

"We believe evidence development is key to further support clinician adoption and commercial coverage of our tests. During the quarter, we advanced our clinical studies and saw continued progress with publications of peer-reviewed articles.

"As we look ahead to the remainder of 2020 and into 2021, with our team’s continued commitment to improve patient outcomes, we believe we remain well-positioned for long-term growth and value creation."

Third Quarter Ended Sept. 30, 2020, Selected Results

Revenues were $15.2 million in the third quarter of 2020, a 3% increase compared to $14.8 million in the third quarter of 2019. Included in revenue for the quarter were positive revenue adjustments related to tests delivered in prior periods of $1.5 million, compared to positive adjustments of $3.2 million for the quarter ended Sept. 30, 2019.
Delivered 4,404 DecisionDx-Melanoma test reports in the third quarter of 2020, a 7% increase compared to the 4,126 reports delivered in the third quarter of 2019, despite a reduction in melanoma diagnoses, which the Company believes is due to the ongoing impacts of COVID-19.
Delivered 318 DecisionDx-UM test reports in the third quarter of 2020, compared to 356 reports in the third quarter of 2019. The Company believes this decrease is the result of fewer patient visits to physicians during the quarter due to the COVID-19 pandemic.
The Company’s DecisionDx-SCC test became commercially available on Aug. 31, 2020. For the period of Aug. 31, 2020 through Sept. 30, 2020, the Company delivered 57 DecisionDx-SCC test reports.
Gross margin in the third quarter of 2020 was 84%.
Operating cash flow was $(3.0) million in the third quarter of 2020, compared to $0.8 million in the third quarter of 2019.
Nine Months Ended Sept. 30, 2020, Selected Results

Revenues were $45.4 million, a 32% increase compared to $34.2 million during the same period in 2019. Included in revenue for the period were positive revenue adjustments related to tests delivered in prior periods. For the nine months ended Sept. 30, 2020 and 2019, these amounts totaled $0.2 million and $2.4 million, respectively.
Delivered 11,986 DecisionDx-Melanoma test reports, an increase of 8% over the same period in 2019.
Delivered 985 DecisionDx-UM test reports, a decrease of 10% over the same period in 2019.
Gross margin for the nine months ended Sept. 30, 2020, was 85%.
Operating cash flow was $10.3 million, compared to $2.5 million for the same period in 2019.
Adjusted operating cash flow, excluding the effects of certain relief payments described below, was $0.1 million, compared to $2.5 million for the same period in 2019.
Cash and Cash Equivalents

As of Sept. 30, 2020, the Company’s cash and cash equivalents totaled $183.1 million, and the outstanding principal balance on the Company’s bank term loan was $23.4 million.

Third Quarter and Recent Business and Clinical Evidence Highlights

Medicare Administrative Contractor (MAC), Palmetto GBA MolDx, issued a final expanded local coverage determination (LCD) and an accompanying billing and coding article for the company’s DecisionDx-Melanoma test. The effective date is Nov. 22, 2020. Additionally, Noridian, the MAC that oversees Castle’s laboratory in Arizona, issued an identical LCD to the Palmetto LCD, effective Dec. 6, 2020. The expanded LCD provides reimbursement for the significant majority of Medicare beneficiaries whose clinicians order DecisionDx-Melanoma as part of their melanoma management plan. Details on the LCD and the billing and coding article are posted to the Medicare Coverage Database on the Centers for Medicare & Medicaid Services (CMS) website.
The Company launched its DecisionDx-SCC test, and it was made commercially available on Aug. 31, 2020. DecisionDx-SCC is a 40-gene expression profile test that uses an individual patient’s tumor biology to predict individual risk of squamous cell carcinoma metastasis for patients with one or more risk factors. The test result, in which patients are stratified into a Class 1, 2A or 2B risk category, is designed to predict individual metastatic risk to inform risk-appropriate management. The Company has four peer-reviewed publications to date, demonstrating that DecisionDx-SCC is an independent predictor of metastatic risk and that integrating DecisionDx-SCC with current prognostic methods can add positive predictive value to clinician decisions regarding staging and management.
The Company launched its DecisionDx DiffDx-Melanoma test, and it was made commercially available on Nov. 2, 2020. DecisionDx DiffDx-Melanoma is designed to aid dermatopathologists in characterizing difficult-to-diagnose melanocytic lesions. In the third quarter of 2020, in preparation for the commercial launch, the Company hired and trained a dedicated DiffDx-Melanoma commercial team, which includes outside sales representatives, medical sales liaisons and internal sales staff.
Data from a systematic review and meta-analysis of the DecisionDx-Melanoma test was published, in print, in the September 2020 issue of the Journal of the American Academy of Dermatology (JAAD). Under multi-variate analysis, the DecisionDx-Melanoma test was shown to be independent from other clinical factors (age, Breslow tumor thickness, ulceration and node status) and improve upon risk assessment performed with staging factors alone. Under the Strength of Recommendation Taxonomy (SORT) system, a systematic review and meta-analysis provides for the highest level of evidence for a prognostic biomarker (Level 1 evidence). The SORT system is used by the American Academy of Dermatology and other organizations to evaluate the quality, quantity and consistency of evidence supporting tests, such as DecisionDx-Melanoma. For details, see the Company’s news release from April 1, 2020.
The publication of a retrospective study, titled "Integrating the melanoma 31-gene expression profile test to surgical oncology practice within national guideline and staging recommendations," showing that DecisionDx-Melanoma impacted management decisions for patients diagnosed with American Joint Committee on Cancer (AJCC) 7th edition stage I – III melanoma, appeared in Future Oncology. Study authors developed a recommended melanoma patient care algorithm that incorporates DecisionDx-Melanoma to help inform frequency and duration of follow-up visits, blood work and surveillance imaging in line with predicted metastatic risk. Patients’ DecisionDx-Melanoma test result was found to have an impact on the number and duration of follow-up and surveillance visits, and patients assessed as having a high risk of metastasis (designated by a DecisionDx-Melanoma Class 2 test result) received more intensive management than patients assessed as having a low risk (designated by a DecisionDx-Melanoma Class 1 test result). Clinicians using the test were shown to adjust patient management in a risk-appropriate direction, within recommendations of national guidelines.
Conference Call and Webcast Details

Castle Biosciences will hold a conference call on Monday, Nov. 9, 2020, at 4:30 p.m. Eastern time to discuss its third quarter 2020 results and provide a corporate update.

A live webcast of the conference call can be accessed here: View Source or via the webcast link on the Investor Relations page of the Company’s website (www.castlebiosciences.com). Please access the webcast at least 10 minutes before the conference call start time. An archive of the webcast will be available on the Company’s website until Nov. 30, 2020.

To access the live conference call via phone, please dial 877-282-2581 from the United States and Canada, or +1 470-495-9479 internationally, at least 10 minutes prior to the start of the call, using the conference ID 3586364.

There will be a brief Question & Answer session following management commentary.

Use of Non-GAAP Financial Measures (UNAUDITED)

In this release, we use the metric of Adjusted Operating Cash Flow, which is a non-GAAP financial measure and is not calculated in accordance with generally accepted accounting principles in the United States (GAAP). This non-GAAP financial measure reflects adjustments to net cash provided by operating activities to remove the effects of two payments we received associated with government aid to healthcare providers due to COVID-19, which we believe are not indicative of our ongoing operations.

We use Adjusted Operating Cash Flow internally because we believe this metric provides useful supplemental information in assessing our cash flow performance from our core ongoing business activities by removing the effects of these items on our operating cash flows. We believe this metric is also useful to investors as a supplement to GAAP measures in analyzing the performance of our business. However, this non-GAAP financial measure may be different from non-GAAP financial measures used by other companies, even when the same or similarly titled terms are used to identify such measures, limiting their usefulness for comparative purposes. This non-GAAP financial measure is not meant to be a substitute for net cash provided by operating activities reported in accordance with GAAP and should be considered in conjunction with our financial information presented on GAAP basis. Accordingly, investors should not place undue reliance on non-GAAP financial measures. Reconciliations of this non-GAAP financial measure to the most directly comparable GAAP financial measure are presented in the table at the end of this press release.

On November 9, 2020 Omeros Corporation (Nasdaq: OMER), a commercial-stage biopharmaceutical company committed to discovering, developing and commercializing small-molecule and protein therapeutics for large-market as well as orphan indications targeting inflammation, complement-mediated diseases, disorders of the central nervous system and immune-related diseases, including cancers, reported recent highlights and developments as well as financial results for the third quarter ended September 30, 2020, which include (Press release, Omeros, NOV 9, 2020, View Source [SID1234570370]):

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Revenues for the third quarter of 2020 were $26.1 million following an $8.7 million deduction as a return reserve associated with the expiration of pass-through reimbursement for OMIDRIA on October 1, 2020. Omeros believes that it qualifies for and is pursuing separate payment from the Centers for Medicare and Medicaid Services (CMS) for OMIDRIA. For comparison, third quarter 2019 and second quarter 2020 revenues were $29.9 million and $13.5 million, respectively.
Net loss in the third quarter of 2020 was $38.5 million, or $0.66 per share, of which $13.6 million, or $0.23 per share, were non-cash expenses. This compares to a net loss of $16.5 million, or $0.33 per share, in the third quarter of 2019. On a non-GAAP basis, adjusted net loss for the third quarter of 2020 was $19.9 million, or $0.34 per share, after excluding non-cash expenses and a $5.0 million technology access fee. Net loss and adjusted net loss include the $8.7 million deduction in third quarter 2020 revenues for the return reserve.
At September 30, 2020, the company had cash, cash equivalents and short-term investments available for operations of $153.5 million. This includes $93.7 million in proceeds from a common stock offering and $76.9 million in proceeds from the issuance of convertible notes, following the use of a portion of the proceeds to repurchase a portion of our previously outstanding convertible notes and enter into certain derivative transactions, all of which took place during the third quarter.
Omeros will complete submission next week to the U.S. Food and Drug Administration (FDA) of its rolling Biologics License Application (BLA) for narsoplimab for the treatment of hematopoietic stem cell transplant-associated thrombotic microangiopathy (HSCT-TMA or TA-TMA). Final clinical data from the BLA were presented in a webcast last month, as described below.
In August, Omeros reported results from a study evaluating narsoplimab for treatment of COVID-19-associated acute respiratory distress syndrome (ARDS). Six COVID-19 patients in Bergamo, Italy were treated with narsoplimab. All six patients required mechanical ventilation prior to narsoplimab treatment, and each recovered, survived and was discharged from the hospital following treatment. Two historical control groups that had similar baseline characteristics showed mortality rates of 32 percent and 53 percent. The results of the trial were published in the peer-reviewed journal Immunobiology. Five to six months after cessation of narsoplimab dosing, all patients were doing well and none showed clinical or laboratory evidence of longer-term effects from COVID-19.
In September, Omeros initiated its Phase 1 clinical trial for OMS906, the company’s MASP-3 inhibitor targeting the alternative pathway, and has completed dosing in the first patient cohort.
"The final clinical study results for narsoplimab in the treatment of transplant-associated TMA speak for themselves. The non-clinical and CMC sections of the BLA are under review by FDA, and the clinical sections, which will be submitted next week, are complete, comprehensive and compelling," said Gregory A. Demopulos, M.D., Omeros’ chairman and chief executive officer. "In anticipation of priority review, our team is readying for a successful commercial launch. Beyond TA-TMA and its Phase 3 trials in IgA nephropathy and aHUS, narsoplimab is increasingly recognized as a likely answer to severe COVID-19. Our complement franchise continues expanding with our MASP-3 inhibitor OMS906 on course and marching through its Phase 1 program. Confident that OMIDRIA qualifies for separate payment from CMS, we expect that the drug will increasingly support our unique portfolio of complement inhibitors and the rest of our exciting pipeline programs. Developing a life-saving drug is a rare opportunity, and all of us at Omeros are energized and inspired by the patients – children and adults – who are alive today because of our team’s efforts."

Third Quarter and Recent Developments

Recent developments regarding narsoplimab, Omeros’ lead fully human monoclonal antibody targeting MASP-2 in Phase 3 clinical programs for the treatment of HSCT-TMA, Immunoglobulin A (IgA) nephropathy, and atypical hemolytic uremic syndrome (aHUS), include the following:
In October, Professor Alessandro Rambaldi of the University of Milan and Papa Giovanni XXIII Hospital and Dr. Miguel Perales of Memorial Sloan Kettering Cancer Center presented the final efficacy and safety data from the pivotal trial of narsoplimab in the treatment of HSCT-TMA, which form the basis of the clinical sections of the rolling BLA.
The complete response rates of 61 percent in patients receiving at least one dose of narsoplimab (the full analysis set) and 74 percent in patients receiving the protocol-specified narsoplimab treatment of at least four weeks (the per-protocol population) are higher than what was previously reported.
Median overall survival was 274 days in the full analysis set, 361 days in the per-protocol population and could not be estimated for complete responders because more than half of the responders were still alive at last follow-up, out to as long as roughly four years following treatment.
Omeros applied to the Centers for Disease Control and Prevention (CDC) for an International Classification of Diseases (ICD-10) diagnosis code for HSCT-TMA, and CDC has preliminarily indicated its support for the diagnosis code. Omeros also applied to CMS for an ICD-10 procedure code for the administration of narsoplimab, and CMS has indicated its support for issuance of the procedure code.
In addition to the six COVID-19 patients who were treated with narsoplimab, Omeros has continued to treat critically ill COVID-19 patients under compassionate use. Omeros has also received requests and is in discussions to include narsoplimab in platform trials for COVID-19.
Omeros’ discussions regarding the use of narsoplimab in COVID-19 have progressed with leadership across BARDA, NIAID, NCAT and NIH regarding narsoplimab for the treatment of critically ill COVID-19 patients. With COVID-19 surging again globally and other therapeutics having failed to show benefit in critically ill COVID-19 patients, there is increasing focus on narsoplimab.
Recent developments regarding OMIDRIA include the following:
Pass-through reimbursement status for OMIDRIA expired on October 1, 2020. Omeros met with CMS and the Department of Health and Human Services to assert that OMIDRIA meets the objective criteria specified by CMS and must be paid separately in the ambulatory surgery center (ASC) setting. Omeros also submitted to CMS a comment letter on the proposed 2021 Outpatient Prospective Payment System/ASC Rule along with a legal memorandum from an outside law firm reiterating this position and seeking confirmation of separate payment status for OMIDRIA in the ASC setting for the fourth quarter of 2020 and calendar year 2021.
An article entitled "Real-world opioid prescribing after cataract surgery among patients who received intracameral phenylephrine and ketorolac 1.0%/0.3%" was published in the peer-reviewed journal Current Medical Research and Opinion. The study demonstrates that patients who received OMIDRIA during cataract surgery were prescribed fewer opioid pills following surgery than patients who did not receive OMIDRIA, despite the OMIDRIA-treated group having a greater incidence of preoperative comorbidities and higher risk for surgical complexity.
Updates regarding Omeros’ other development programs and platforms include the following:
Omeros has completed, on schedule, dosing in the first cohort in a Phase 1, placebo-controlled, double-blind, single-ascending-dose and multiple-ascending-dose study for OMS906, the company’s MASP-3 inhibitor. The second cohort in the Phase 1 study has begun dosing. Omeros expects to achieve a once-monthly subcutaneous dosing regimen. Data readout from the Phase 1 study is planned for next year.
Omeros presented data on the OMS906 program at the 4th Complement-based Drug Development Summit in October.
Financial Results

For the third quarter of 2020, OMIDRIA revenues were $26.1 million, down from $29.9 million for the same period in 2019 and up from $13.5 million for the second quarter of 2020. The decrease compared to the third quarter of 2019 was due to an $8.7 million deduction as a reserve for product returns related to the expiration of pass-through reimbursement on October 1, 2020.

Total costs and expenses for the third quarter of 2020 were $51.5 million compared to $41.0 million for the same period in 2019. The increase reflects a fee payable under a technology license agreement related to Omeros’ MASP-3 program and increased pre-commercialization marketing activities for narsoplimab. Selling, general and administrative expenses were $19.8 million in the third quarter of 2020, compared to $16.9 million in the corresponding period in 2019.

For the three months ended September 30, 2020, Omeros reported a net loss of $38.5 million, or $0.66 per share, compared to a net loss of $16.5 million, or $0.33 per share, for the same period in 2019. On a non-GAAP basis, adjusted net loss for the three months ended September 30, 2020 was $19.9 million, or $0.34 per share, after excluding non-cash expenses of $13.6 million, or $0.23 per share, and a technology access fee of $5.0 million, or $0.09 per share. Both net loss and adjusted net loss include the $8.7 million deduction in the third quarter of 2020 for the return reserve.

As of September 30, 2020, Omeros had $153.5 million of cash, cash equivalents and short-term investments available for operations and accounts receivable of $37.4 million.

During the third quarter, Omeros issued approximately $225.0 million aggregate principal amount 5.25% convertible senior notes due February 2026 (the 2026 Notes). Concurrently, Omeros repurchased $115.0 million aggregate principal amount of previously outstanding 6.25% convertible senior notes due November 2023. Omeros recorded a $13.4 million non-cash loss on early extinguishment of debt and a $7.9 million non-cash income tax benefit associated with these transactions. Omeros also entered into capped call contracts associated with the 2026 Notes that cover, subject to anti-dilution adjustments that may not match those applicable to the conversion price of the 2026 Notes, the number of shares of Omeros’ common stock underlying the 2026 Notes when Omeros’ common stock is trading between the initial conversion price of approximately $18.49 and the $26.10 cap price.

In August, Omeros sold 6.9 million shares in an underwritten public offering and received $93.7 million in net proceeds from the offering.

On November 9, 2020 Atara Biotherapeutics, Inc. (Nasdaq: ATRA), a pioneer in T-cell immunotherapy, leveraging its novel allogeneic EBV T-cell platform to develop transformative therapies for patients with serious diseases including solid tumors, hematologic cancers and autoimmune disease, reported financial results for the third quarter ended September 30, 2020 and recent business highlights (Press release, Atara Biotherapeutics, NOV 9, 2020, View Source [SID1234570369]).

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"Atara is on track to finish the year strong, meeting each milestone set to date," said Pascal Touchon, President and Chief Executive Officer of Atara. "Following an encouraging interim analysis of the pivotal Phase 3 data for tab-cel in relapsed-refractory EBV+ PTLD and very productive interactions with regulatory authorities, we are preparing for tab-cel submissions, and then approval and launch. We are committed to bringing this potentially life-saving therapy to the patients who acutely need it as they have no other therapeutic solution and face a very limited median life expectancy of only two to three months."

Tab-cel for Post-transplant Lymphoproliferative Disease (PTLD)

An Interim Analysis of the tab-cel ALLELE study showed a 50 percent objective response rate (ORR) to tab-cel with independent oncologic and radiographic assessment (IORA) in patients with relapsed-refractory EBV+ PTLD following hematopoietic cell transplants (HCT) or solid organ transplants (SOT), that had reached at least six months follow-up after achieving a response. This ORR is consistent with previously published investigator assessed data. The tab-cel safety profile is also consistent with previously published data, with no new safety signals.
In October, working under the Breakthrough Therapy Designation (BTD) for tab-cel, Atara presented a comprehensive data package to the FDA. The Company aligned with FDA on several key topics related to the regulatory package, including:
a rolling submission is acceptable for the biologics license application (BLA);
the Company can complete the BLA submission with the ALLELE study’s currently enrolled patients with at least six months follow-up for duration of response; and
the FDA will consider the following as supportive data to the pivotal study in the BLA clinical module: the Phase 2 trials conducted at Memorial Sloan Kettering (MSK); Atara’s Phase 2 multicenter expanded access protocol (201 EAP study); and, the Single Patient Use (SPU) program.
Atara remains on track to initiate a BLA submission for patients with EBV+ PTLD by the end of 2020. The Company will continue engaging with the FDA as part of its rolling BLA and BTD status and expects to finalize the BLA submission in Q3 2021.
Following discussion with the PRIority MEdicines (PRIME) team and after EMA approval of the Pediatric Investigation Plan (PIP) expected in December 2020, Atara is on track to submit an EU marketing authorization application (MAA) for patients with EBV+ PTLD in the second half of 2021.
Data from the ALLELE study will be presented at an appropriate congress in 2021.
Tab-cel for Potential Additional Indications

Atara initiated a tab-cel Phase 2 multi-cohort study in the third quarter of 2020 and expects to enroll the first patient in the fourth quarter of 2020. This study is being initiated concurrently in the U.S. and the EU.
The multi-cohort study is intended to enrich the evidence base with the goal of expanding the potential label for tab-cel in both treatment-naïve and previously treated patients (in six populations, including four within Immunodeficiency-Associated Lymphoproliferative Diseases (IA-LPDs) and two in other EBV-associated diseases).
Data demonstrating tab-cel was well-tolerated and showed encouraging clinical activity in patients with EBV+ AID-LPD and PID-LPD (Acquired and Primary Immunodeficiency LPDs) were featured in an e-poster at the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) 2020 Virtual Congress held in September 2020. Specifically, in patients where previous treatments have failed, the objective response rate, including complete response, were 33.3 percent (three out of nine patients) in AID-LPD and 37.5 percent (three out of eight patients) in PID-LPD groups. Tab-cel was generally well-tolerated with a favorable safety profile consistent with previously published clinical studies.
Data on tab-cel in patients with life-threatening complications stemming from persistent EBV viremia was accepted for presentation at the 62nd American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exposition being held virtually December 5-8, 2020. These clinical data demonstrate that tab-cel was well-tolerated and showed encouraging clinical activity in this patient population with objective response rate ranging from 50 to 80 percent, warranting further investigation in the Phase 2 multi-cohort study.
ATA188 for Progressive Forms of Multiple Sclerosis (MS)

Atara’s Phase 1 clinical study of off-the-shelf, allogeneic ATA188 in patients with progressive forms of MS is ongoing, with encouraging data recently reported and more data from the Open Label Extension (OLE) to be periodically presented over the next 12 months including at the European Charcot Foundation (ECF) 28th Annual Meeting November 15-19, 2020.
Twelve-month data from all four cohorts in the Phase 1a portion of the study were presented at the MSVirtual2020: 8th Joint ACTRIMS-ECTRIMS Meeting held in September 2020.
These data demonstrated that ATA188 was well-tolerated across all four dose cohorts; patients who demonstrated sustained disability improvements (SDI) at any timepoint maintained it at all future timepoints; and, a higher proportion of patients showed SDI with increasing dose (42 percent in Cohorts 3 and 4 (higher doses) vs 17 percent in Cohorts 1 and 2 (lower doses)).
No dose-limiting toxicities and no fatal adverse events (AEs) have been reported. The safety profile has remained consistent with previously reported data.
Data from the OLE with redosing at 12 months show that of the three patients enrolled in the OLE at that time that had SDI at 12 months, all maintained SDI at 15 months, including one patient evaluated at both 15 and 18 months who maintained SDI at both time points. A fourth patient demonstrated SDI during the OLE at 24 months.
Atara also presented preclinical translational data at ACTRIMS-ECTRIMS that further support the proposed mechanism of action of ATA188 targeting EBV-infected B cells. These combined analyses of T cells comprising ATA188 are consistent with its proposed mechanism of targeting EBV-infected B cells by recognizing MS-relevant EBV antigens on these cells via defined T cell receptors (TCRs).
The double-blind randomized placebo-controlled trial (RCT), which enrolled its first patient in June 2020 continues active recruitment.
Given encouraging clinical results to date in ATA188 studies and the significant unmet medical need in progressive forms of MS, the Company is increasing its investment in the ATA188 program. Atara is expanding the size of the RCT to at least 64 patients, changing the primary endpoint of the study to disability improvement, and maintaining biological and functional endpoints; the design allows for the addition of the cohort 4 dose if desired.
Atara plans to discuss the Phase 1a data with the FDA by the end of this year, as well as the updated RCT study design, and potential opportunities for accelerated development of ATA188 for MS patients.
CAR T Programs

ATA2271/ATA3271 (Solid Tumors Over-Expressing Mesothelin)

The open-label, single-arm Phase 1 clinical study of ATA2271, the Company’s second-generation autologous CAR T therapy targeting mesothelin (MSLN) that incorporates for the first time both a PD-1 DNR (dominant-negative programmed death-1 receptor) for intrinsic check-point inhibition and novel 1XX co-stimulatory domain, has been initiated for the treatment of advanced mesothelioma. Recently presented preclinical data have shown improved functional persistence and enhanced anti-tumor efficacy superior to first-generation MSLN CAR T. MSK is on track to enroll the first patient in the Phase 1 study in Q4 2020.
ATA3271 is an off-the-shelf, allogeneic CAR T therapy targeting MSLN using a PD-1 DNR and 1XX CAR co-stimulatory signaling domain through Atara’s EBV T-cell platform. In new preclinical data, ATA3271 demonstrates potent anti-tumor activity, functional persistence and significant survival benefit with no evidence of allocytotoxicity in vivo, suggesting that allogeneic MSLN-CAR-engineered EBV T cells are a promising approach for the treatment of MSLN-positive cancers. These data will be presented at the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) 35th Anniversary Annual Meeting November 11-14, 2020.
ATA3219 (B-cell Malignancies)

A collaborative and successful pre-IND meeting with the FDA in October 2020 provided feedback to guide the IND filing in 2021.
IND-enabling studies are progressing with a package ready to be filed in 2021 for ATA3219, a potent next-generation off-the-shelf allogeneic CD19 CAR T utilizing the 1XX technology without the need for TCR gene editing through Atara’s EBV T-cell platform.
The first abstract to be presented on ATA3219 was accepted for presentation at the 62nd American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exposition being held virtually December 5-8, 2020. These preclinical data for ATA3219 demonstrate persistence, polyfunctional phenotype and efficient targeting of CD19-expressing tumor cells with no evidence of allocytotoxicity in vivo.
Third Quarter 2020 Financial Results

Cash, cash equivalents and short-term investments as of September 30, 2020 totaled $327.2 million, as compared to $347.7 million as of June 30, 2020.
September 30, 2020 cash balance of $327.2 million included $34.1 million net proceeds from at-the-market (ATM) facilities during the third quarter of 2020. Third quarter 2020 cash burn was $20.5 million, net of ATM proceeds.
Atara believes that its cash, cash equivalents and short-term investments as of September 30, 2020 are sufficient to fund planned operations into 2022.
Net cash used in operating activities was $53.0 million for the third quarter of 2020, as compared to $52.1 million for the same period in 2019.
The number of outstanding shares of common stock and pre-funded common stock warrants as of September 30, 2020 was 77,220,159 shares and warrants to purchase 5,755,487 shares, respectively.
Atara reported net losses of $74.3 million, or $0.92 per share, for the third quarter of 2020, as compared to $71.9 million, or $1.31 per share, for the same period in 2019.
Total operating expenses include non-cash expenses of $15.4 million for the third quarter 2020, as compared to $13.9 million for the same period in 2019.
Research and development expenses were $59.9 million for the third quarter of 2020, as compared to $53.5 million for the same period in 2019. The increase in the 2020 period was primarily due to costs associated with the Company’s continuing expansion of research and development activities, including:
Clinical trial, manufacturing and process performance qualification activities related to tab-cel.
Higher employee-related costs from increased headcount.
Research and development expenses include $8.2 million of non-cash stock-based compensation expenses for the third quarter of 2020, as compared to $7.0 million for the same period in 2019.
General and administrative expenses were $14.8 million for the third quarter of 2020, as compared to $19.0 million for the same period in 2019. The decrease in the 2020 period was primarily due to decrease in outside services costs and employee-related costs.
General and administrative expenses include $5.1 million of non-cash stock-based compensation expenses for the third quarter of 2020, as compared to $5.1 million for the same period in 2019.