Kronos Bio Reports Recent Business Progress and First-Quarter 2022 Financial Results

On May 4, 2022 Kronos Bio, Inc. (Nasdaq: KRON), a company dedicated to transforming the lives of those affected by cancer and other serious diseases, reported recent business progress and first quarter 2022 financial results (Press release, Kronos Bio, MAY 4, 2022, View Source [SID1234613512]).

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"We continued to advance our three clinical programs this quarter and, in addition, presented preclinical data that support the development strategy for our internally discovered CDK9 inhibitor, KB-0742, at the AACR (Free AACR Whitepaper) Annual Meeting," said Norbert Bischofberger, Ph.D., president and chief executive officer of Kronos Bio. "Overall, we are pleased with our progress in executing against our goals and look forward to announcing the recommended Phase 2 dose and presenting additional clinical data for KB-0742 in the fourth quarter of this year."

First Quarter and Recent Company Updates
•SYK Inhibitor Programs
◦During the first quarter, Kronos Bio opened additional sites for its Phase 1b/2 clinical trial of lanraplenib, the company’s next generation spleen tyrosine kinase (SYK) inhibitor, in combination with gilteritinib in patients with FLT3-mutated acute myeloid leukemia (AML). The company anticipates dosing the first patient during the second quarter.
◦Kronos Bio is continuing to enroll patients in the registrational Phase 3 AGILITY clinical trial of entospletinib, a selective inhibitor targeting SYK, in combination with standard of care anthracycline and cytarabine (7+3) chemotherapy in patients with NPM1-mutated AML. Data are anticipated in the second half of 2023 with a primary endpoint of measurable residual disease (MRD) negative complete response.
•KB-0742
◦At the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting 2022 in April, Kronos Bio presented preclinical data that add to growing evidence in support of the company’s approach to the clinical development of KB-0742, its internally discovered, highly selective, oral cyclin dependent kinase 9 (CDK9) inhibitor. Data were presented from multiple preclinical translational model systems that support the development of the compound in triple-negative breast, ovarian and lung cancers, as well as lymphoma, chordoma and sarcoma.
◦The company is continuing with dose escalation in the Phase 1/2 study of KB-0742 and is on track to announce additional Phase 1 data, along with the recommended Phase 2 dose, in the fourth quarter of 2022. Kronos Bio presented initial data in the fourth quarter of 2021. A pharmacokinetic analysis showed oral bioavailability and dose-proportional exposure across the first three dose levels, with low to moderate variability between patients. KB-0742 had a terminal half-life of 24 hours, with approximately 2 to 2.5-fold accumulation between Day 1 and Day 10 among the 12 patients treated in the trial.

•Corporate Updates
◦Kronos Bio has implemented fiscal prudence measures, which provide expected cash runway into the second half of 2024, as announced earlier this year. These measures include deprioritizing a second Phase 1b/2 clinical trial of lanraplenib in combination with venetoclax/azacitidine to better focus the company’s resources on areas of greatest unmet medical need.
◦Kronos Bio announced the appointment of Dr. Elizabeth Olek, DO, MPH, as senior vice president, Clinical Development. Dr. Olek joined Kronos Bio from Loxo Oncology at Lilly.

First Quarter 2022 Financial Highlights

•Cash, Cash Equivalents and Investments: With its ongoing and currently planned clinical programs and $315.4 million in cash, cash equivalents and investments as of March 31, 2022, the company anticipates sufficient resources to fund its planned operations into the second half of 2024.

•R&D Expenses: Research and development expenses were $24.4 million for the first quarter of 2022, which includes non-cash stock-based compensation expense of $3.8 million.

•G&A Expenses: General and administrative expenses were $11.9 million for the first quarter of 2022, which includes non-cash stock-based compensation expense of $4.0 million.

•Net Loss: Net loss for the first quarter of 2022 was $36.3 million, or $0.65 per share, including non-cash stock-based compensation expense of $7.8 million.

Acorda First Quarter 2022 Update: Webcast/Conference Call Scheduled for May 11, 2022

On May 4, 2022 Acorda Therapeutics, Inc. (NASDAQ: ACOR) reported that it will host a webcast/conference call in conjunction with its first quarter 2022 update and financial results on Wednesday, May 11 at 4:30 p.m. ET (Press release, Acorda Therapeutics, MAY 4, 2022, View Source [SID1234613511]).

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To participate in the Webcast, please use the following pre-registration link:

View Source
If you register for the Webcast, you will have the opportunity to submit a written question for the Q&A portion of the presentation. Once you have registered, you will receive a confirmation email with Webcast/Conference Call details. For the Webcast, you will receive an email 2 hours prior to the start of the call with the link to join. The presentation will be available on the Investors section of www.acorda.com.

A replay of the call will be available from 7:30 p.m. ET on May 11, 2022 until 11:59 p.m. ET on June 10, 2022. To access the replay, please dial 1 866 813 9403 (domestic) or +44 204 525 0658 (international); reference code 258745. The archived webcast will be available in the Investor Relations section of the Acorda website at www.acorda.com.

Catalyst Clinical Research Acquires Aptus Clinical to Accelerate European Expansion, Broaden Client Services, and Enhance Patient Impact

On May 4, 2022 Catalyst Clinical Research, a market-leading provider of clinical research services, reported a strategic acquisition of Aptus Clinical to expand the geographic reach of the two companies, and to enhance patient access to advanced, life-changing therapies (Press release, Catalyst Clinical Research, MAY 4, 2022, View Source [SID1234613510]). Together, the two entities will become one multi-region clinical research organization with an accelerated growth trajectory in both the U.S. and Europe.

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Catalyst’s offerings will now encompass extensive and expanded clinical consulting services, as it inherits Aptus’ strong and established relationship with the Experimental Cancer Medicine Centre (ECMC) network to support trial set-up and clinical design input. Positioned at the forefront of novel cancer treatment trends, Catalyst’s active portfolio serves more than 5,300 cancer patients in need and will grow by nearly 600 patients concurrent to this acquisition.

"We are thrilled to be working with Aptus Clinical to expand our reach in the European market, serving clients around the globe to help develop innovative new therapies, improve patient outcomes and enhance our company’s long-term impact," said Catalyst Clinical Research CEO, Nick Dyer. "Our complementary service offerings and therapeutic area alignment will improve outcomes for all our clients."

"Catalyst continues to prove its capabilities as a leader in oncology clinical development and as a preferred strategic acquirer for growing businesses," said Vern Davenport, Partner at NovaQuest Capital Management and Catalyst Board Chairman. "Aptus provides Catalyst with a highly capable team of experts in Europe to accelerate its global ambitions, of which we are incredibly supportive." Catalyst Clinical Research is a portfolio company of global platform NovaQuest Capital Management, LLC.

Formed in 2014 by three former AstraZeneca clinical development experts, Aptus Clinical has rapidly established itself as a specialist CRO offering flexible clinical research solutions in oncology, cell and gene therapies and rare diseases. Together the companies, operating as Catalyst Oncology, will continue to deliver on a portfolio of more than 100 active oncology studies via a network of 500 keenly involved investigator sites. Additional studies outside the Oncology therapeutic area will be delivered under the Catalyst Flex solution and operating models.

"We are proud to partner with Catalyst to strengthen our shared commitment to delivering cutting edge science to patient populations who are in desperate need of new therapies", said Aptus Clinical CEO, Dr. Steve McConchie. "We firmly believe Aptus Clinical and Catalyst are better together and look forward to combining our decades of experience in developing and delivering high quality clinical trials to support our combined organisation to become a significant global provider of innovative clinical research solutions."

Combined headcount for the unified company will now exceed 800 staff members. Catalyst will also work to leverage Aptus’ strategic site relationships integrating them into its own site network spanning North America and Europe. The clinical research organization joined forces with Triangle Biostatistics in 2019, and then with Ce3 in 2020. Although this is Catalyst’s third M&A transaction, it is its first international union that will accelerate and expand the companies’ geographic reach greatly.

Fresenius Medical Care reports first quarter results in line with its expectations despite significant headwinds

On May 4, 2022 Fresenius Medical Care reported When we see what is happening in Ukraine, it is again above all the human tragedy that leaves us deeply saddened (Press release, Fresenius, MAY 4, 2022, View Source [SID1234613509]). I am incredibly thankful and proud of all who continue to work tirelessly to ensure patient care and the holding up of our local operations under these outstandingly difficult circumstances. Although it is difficult to talk about numbers with these images in mind, I have to say that in addition, Omicron has affected the quarter heavily. This resulted in high excess mortality among our patients and significantly elevated labor costs in the U.S. to manage isolation clinics and shifts. We were able to compensate this and delivered the quarter in line with our expectations. Based on a strong decline in excess mortality in February and March, we confirm our financial targets for 2022."
Higher than expected COVID-19-related excess mortality at the beginning of the year

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COVID-19-related excess mortality among Fresenius Medical Care’s patients amounted to approximately 2,310 in the first quarter of 2022 (Q1 2021: ~3,200; Q2 2021: ~1,900;
Q3 2021: ~2,900; Q4 2021: ~2,0003). It significantly declined in February and March in line with infection rates, but on a quarterly basis still exceeded the originally anticipated level. This resulted in an increased need for isolation clinics and shifts and limited the Company’s ability to mitigate the impacts from labor shortage and wage inflation in the U.S. market.
COVID-19-related excess mortality accumulated to approximately 9,000 patients over the past twelve months and to approximately 22,600 since the start of the pandemic.
The overall estimated adverse effect of accumulated COVID-19-related excess mortality on organic growth in the Health Care Services business amounted to around 290 basis points in the first quarter.

1 2021: costs related to the FME25 program; 2022: costs related to the FME25 program and impacts related to the war in Ukraine
2 Net income attributable to shareholders of Fresenius Medical Care AG & Co. KGaA
3 Historical excess mortality updated for late entries

War in Ukraine impacting business development

The war in Ukraine is affecting Fresenius Medical Cares’ dialysis operations and patient care in the country itself, but also caused higher bad debt expenses in Russia and Ukraine. The direct adverse effect of the war in Ukraine amounted to EUR 22 million at operating income level in the first quarter and is treated as a special item. Fresenius Medical Care will continue to monitor closely the potential effects of the war as well as the general impact of the challenging inflationary macroeconomic environment.

First quarter earnings development in line with expectations

Revenue increased by 8% to EUR 4,548 million (+3% at constant currency, +2% organic).

Health Care Services revenue increased by 8% to EUR 3,607 million (+3% at constant currency, +1% organic). At constant currency, this was mainly driven by organic growth, which was achieved despite the adverse impact of COVID-19, the partial reversal of an accrual related to a revenue recognition adjustment for accounts receivable in legal dispute and contributions from acquisitions.

Health Care Products revenue increased by 6% to EUR 941 million (+3% at constant currency, +3% organic). Constant currency growth was mainly driven by higher sales of in-center disposables and renal pharmaceuticals. This was partially offset by lower sales of machines for chronic treatment.

Operating income decreased by 27% to EUR 348 million (-30% at constant currency), resulting in a margin of 7.6% (Q1 2021: 11.3%). Operating income excluding special items, i.e. costs incurred for FME25 and the impacts related to the war in Ukraine, declined by 15% to EUR 403 million (-19% at constant currency), resulting in a margin of 8.9% (Q1 2021: 11.3%). At constant currency, the decline was mainly due to higher labor costs, adverse COVID-19-related effects, as well as inflationary and supply chain cost increases. These effects were only partially mitigated by the partial reversal of an accrual related to a revenue recognition adjustment for accounts receivable in legal dispute.

Net income2 decreased by 37% to EUR 157 million (-39% at constant currency). Excluding special items, net income declined by 20% to EUR 200 million (-23% at constant currency), mainly due to the mentioned negative effects on operating income.

Basic earnings per share (EPS) decreased by 37% to EUR 0.54 (-39% at constant currency). EPS excluding special items declined by 20% to EUR 0.68
(-23% at constant currency).

Cash flow development

In the first quarter, Fresenius Medical Care generated EUR 159 million of operating cash flow (Q1 2021: EUR 208 million), resulting in a margin of 3.5% (Q1 2021: 4.9%). The decrease was mainly due to continued recoupment of the U.S. government’s payments received in 2020 under the CARES Act and a decrease in net income, partially offset by a favorable impact from trade accounts and other receivables.

Free cash flow4 amounted to EUR -1 million (Q1 2021: EUR 29 million) in the first quarter, resulting in a margin of 0.0% (Q1 2021: 0.7%).

Regional developments

In North America, revenue increased by 9% to EUR 3,171 million (+2% at constant currency, +0% organic). At constant currency, this was mainly driven by organic growth in the Health Care Product business and the reversal of an accrual related to a revenue recognition adjustment for accounts receivable in legal dispute. This was partially offset by the adverse COVID-19 impact on the Health Care Services business.

Operating income in North America decreased by 24% to EUR 304 million (-29% at constant currency), resulting in a margin of 9.6% (Q1 2021: 13.7%). At constant currency, the decline in operating income was mainly due to higher labor costs, the adverse impact of COVID-19, inflationary and supply chain cost increases as well as costs related to FME25. This was only partially offset by the partial reversal of an accrual related to a revenue recognition adjustment for accounts receivable in legal dispute.

Revenue in the EMEA region increased by 1% to EUR 674 million in the first quarter (+3% at constant currency, +2% organic). At constant currency, this was mainly due to organic growth in the Health Care Services business, which was achieved despite the negative impact of COVID-19.

Operating income in EMEA decreased by 23% to EUR 61 million (-19% at constant currency), resulting in a margin of 9.1% (Q1 2021: 11.9%). The decline was mainly due to the impact related to the war in Ukraine.

4 Net cash provided by / used in operating activities, after capital expenditures, before acquisitions, investments, and dividends

In Asia-Pacific, revenue increased by 8% to EUR 507 million (+4% at constant currency, +4% organic). At constant currency, this was mainly driven by organic growth in the Health Care Products business.

Operating income increased by 16% to EUR 99 million (+14% at constant currency), resulting in a margin of 19.5% (Q1 2021: 18.1%). At constant currency, this was mainly due to a gain from the sale of clinics, favorable currency transaction effects and growth in the Health Care Products business.

Latin America revenue increased by 15% to EUR 183 million (+15% at constant currency, +16% organic), mainly driven by strong organic growth in both the Health Care Services and Health Care Products business.

Operating income improved by 68% to EUR 11 million (+51% at constant currency), resulting in a margin of 6.1% (Q1 2021: 4.2%). This was mainly due to a favorable currency transaction effect, which was partially offset by inflationary cost increases.

Patients, clinics and employees

As of March 31, 2022, Fresenius Medical Care treated 343,493 patients in 4,153 dialysis clinics worldwide and had 122,635 employees (full-time equivalents) globally, compared to 124,995 employees as of March 31, 2021.

Outlook

Based on the results for the first quarter, which were in line with the Company’s expectations, Fresenius Medical Care confirms its financial targets for 2022. The earnings improvement will be driven by expected business growth, PPE cost reduction and FME25 savings. The Company expects revenue and net income to grow at low to mid-single digit percentage rates in FY 2022.5

5 These targets are based on the 2021 results excluding the costs related to FME25 of EUR 49 million (for Net Income). They are based on the assumptions outlined in the Press Release on the Q4 and FY 2021 results (Feb. 22, 2022), in constant currency and exclude special items. Special items include further costs related to FME25, the impacts related to the war in Ukraine, and other effects that are unusual in nature and have not been foreseeable or not foreseeable in size or impact at the time of giving guidance.

Conference call

Fresenius Medical Care will host a conference call to discuss the results of the first quarter 2022 on May 4, 2022 at 3:30 p.m. CEST / 9:30 a.m. EDT. Details will be available on the Fresenius Medical Care website in the "Investors" section. A replay will be available shortly after the call.

Fresenius Kabi Completes Acquisition of Ivenix

On May 4, 2022 Fresenius Kabi reported that closed the acquisition in March of Ivenix, Inc. ("Ivenix"), a specialized infusion therapy company (Press release, Fresenius, MAY 4, 2022, View Source [SID1234613508]). Ivenix adds a next-generation infusion therapy platform for the significant U.S. market to Fresenius Kabi’s portfolio and provides the company with key capabilities in hospital connectivity. The combination of Ivenix’s leading hardware and software products with Fresenius Kabi’s offering in intravenous fluids and infusion devices will create a comprehensive and leading portfolio of premium products, forming a strong basis to enable sustainable growth in the high-value MedTech space. The purchase price is a combination of US$240 million upfront payment and milestone payments, strictly linked to the achievement of commercial and operating targets.

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