On August 15, 2022 Gilead Sciences, Inc. (Nasdaq: GILD) reported statistically significant and clinically meaningful results from the second interim analysis of the key secondary endpoint of overall survival (OS) in the Phase 3 TROPiCS-02 study evaluating Trodelvy (sacituzumab govitecan-hziy) in patients with HR+/HER2- metastatic breast cancer who received prior endocrine therapy, CDK4/6 inhibitors and two to four lines of chemotherapy (Press release, Gilead Sciences, AUG 15, 2022, View Source;Metastatic-Breast-Cancer-Patients-in-the-TROPiCS-02-Study/default.aspx [SID1234618378]). Detailed OS results will be presented at an upcoming medical conference. The safety profile for Trodelvy was consistent with prior studies, and no new safety signals emerged in this patient population.

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"These survival results from the TROPiCS-02 study are important for the breast cancer community and we are encouraged by the potential this may have in helping patients who otherwise have limited alternatives," said Merdad Parsey, MD, PhD, Chief Medical Officer, Gilead Sciences. "We look forward to discussing these results with global health authorities, as pre-treated HR+/HER2- metastatic disease patients currently have limited treatment options and poor quality of life."

Gilead has submitted a supplemental Biologics License Application (sBLA) to the U.S. Food & Drug Administration (FDA). These data will also be shared with health authorities outside the U.S.

In June 2022, based on the positive primary results from the TROPiCS-02 study presented at the 2022 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting, the National Comprehensive Cancer Network (NCCN) Clinical Practice Guidelines in Oncology (NCCN Guidelines)i included a category 2A preferred recommendation for sacituzumab govitecan-hziy for the investigational use in patients with HR+/HER2- advanced breast cancer after prior treatment including endocrine therapy, a CDK4/6 inhibitor and at least two lines of chemotherapy. The TROPiCS-02 study enrolled HR+/HER2- metastatic breast cancer patients, which included patients with HER2-low and IHC 0 status.

TROPiCS-02 is an event driven study with planned analyses based on a pre-specified number of events. This interim analysis was executed based on the pre-specified criteria.

Trodelvy has not been approved by any regulatory agency for the treatment of HR+/HER2- metastatic breast cancer. Its safety and efficacy have not been established for this indication. Trodelvy has a Boxed Warning for severe or life-threatening neutropenia and severe diarrhea; please see below for additional Important Safety Information.

About HR+/HER2- Breast Cancer

Hormone receptor-positive/human epidermal growth factor receptor 2-negative (HR+/HER2-) breast cancer is the most common type of breast cancer and accounts for approximately 70% of all new cases, or nearly 400,000 diagnoses worldwide each year. Almost one in three cases of early-stage breast cancer eventually become metastatic, and among patients with HR+/HER2- metastatic disease, the five-year relative survival rate is 30%. As patients with HR+/HER2- metastatic breast cancer become resistant to endocrine-based therapy, their primary treatment option is limited to single-agent chemotherapy. In this setting, it is common to receive multiple lines of chemotherapy regimens over the course of treatment, and the prognosis remains poor.

About the TROPiCS-02 Study

The TROPiCS-02 study is a global, multicenter, open-label, Phase 3 study, randomized 1:1 to evaluate Trodelvy versus physicians’ choice of chemotherapy (eribulin, capecitabine, gemcitabine, or vinorelbine) in 543 patients with HR+/HER2- metastatic breast cancer who were previously treated with endocrine therapy, CDK4/6 inhibitors and two to four lines of chemotherapy for metastatic disease. The primary endpoint is progression-free survival per Response Evaluation Criteria in Solid Tumors (RECIST 1.1) as assessed by blinded independent central review (BICR) for participants treated with Trodelvy compared to those treated with chemotherapy. Secondary endpoints include overall survival, overall response rate, clinical benefit rate and duration of response, as well as assessment of safety and tolerability and quality of life measures. In the study, HER2 negativity was defined per American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) and the College of American Pathologists (CAP) criteria as immunohistochemistry (IHC) score of 0, IHC 1+ or IHC 2+ with a negative in-situ hybridization (ISH) test.

More information about TROPiCS-02 is available at View Source

About Trodelvy

Trodelvy (sacituzumab govitecan-hziy) is a first-in-class Trop-2 directed antibody-drug conjugate. Trop-2 is a cell surface antigen highly expressed in multiple tumor types, including in more than 90% of breast and bladder cancers. Trodelvy is intentionally designed with a proprietary hydrolyzable linker attached to SN-38, a topoisomerase I inhibitor payload. This unique combination delivers potent activity to both Trop-2 expressing cells and the microenvironment.

Trodelvy is approved in more than 35 countries, with multiple additional regulatory reviews underway worldwide, for the treatment of adult patients with unresectable locally advanced or metastatic triple-negative breast cancer (TNBC) who have received two or more prior systemic therapies, at least one of them for metastatic disease. Trodelvy is also approved in the U.S. under the accelerated approval pathway for the treatment of adult patients with locally advanced or metastatic urothelial cancer (UC) who have previously received a platinum-containing chemotherapy and either programmed death receptor-1 (PD-1) or programmed death-ligand 1 (PD-L1) inhibitor.

Trodelvy is also being developed for potential investigational use in other TNBC and metastatic UC populations, as well as a range of tumor types where Trop-2 is highly expressed, including hormone receptor-positive/human epidermal growth factor receptor 2-negative (HR+/HER2-) metastatic breast cancer, metastatic non-small cell lung cancer (NSCLC), metastatic small cell lung cancer (SCLC), head and neck cancer, and endometrial cancer.

U.S. Indications for Trodelvy

In the United States, Trodelvy is indicated for the treatment of:

Adult patients with unresectable locally advanced or metastatic TNBC who have received two or more prior systemic therapies, at least one of them for metastatic disease.
Adult patients with locally advanced or metastatic UC who have previously received a platinum-containing chemotherapy and either programmed death receptor-1 (PD-1) or programmed death-ligand 1 (PD-L1) inhibitor. 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 a confirmatory trial.
U.S. Important Safety Information for Trodelvy

BOXED WARNING: NEUTROPENIA AND DIARRHEA

Severe or life-threatening neutropenia may occur. Withhold Trodelvy for absolute neutrophil count below 1500/mm3 or neutropenic fever. Monitor blood cell counts periodically during treatment. Consider G-CSF for secondary prophylaxis. Initiate anti-infective treatment in patients with febrile neutropenia without delay.
Severe diarrhea may occur. Monitor patients with diarrhea and give fluid and electrolytes as needed. Administer atropine, if not contraindicated, for early diarrhea of any severity. At the onset of late diarrhea, evaluate for infectious causes and, if negative, promptly initiate loperamide. If severe diarrhea occurs, withhold Trodelvy until resolved to ≤Grade 1 and reduce subsequent doses.
CONTRAINDICATIONS

Severe hypersensitivity reaction to Trodelvy.
WARNINGS AND PRECAUTIONS

Neutropenia: Severe, life-threatening, or fatal neutropenia can occur and may require dose modification. Neutropenia occurred in 61% of patients treated with Trodelvy. Grade 3-4 neutropenia occurred in 47% of patients. Febrile neutropenia occurred in 7%. Withhold Trodelvy for absolute neutrophil count below 1500/mm3 on Day 1 of any cycle or neutrophil count below 1000/mm3 on Day 8 of any cycle. Withhold Trodelvy for neutropenic fever.

Diarrhea: Diarrhea occurred in 65% of all patients treated with Trodelvy. Grade 3-4 diarrhea occurred in 12% of patients. One patient had intestinal perforation following diarrhea. Neutropenic colitis occurred in 0.5% of patients. Withhold Trodelvy for Grade 3-4 diarrhea and resume when resolved to ≤Grade 1. At onset, evaluate for infectious causes and if negative, promptly initiate loperamide, 4 mg initially followed by 2 mg with every episode of diarrhea for a maximum of 16 mg daily. Discontinue loperamide 12 hours after diarrhea resolves. Additional supportive measures (e.g., fluid and electrolyte substitution) may also be employed as clinically indicated. Patients who exhibit an excessive cholinergic response to treatment can receive appropriate premedication (e.g., atropine) for subsequent treatments.

Hypersensitivity and Infusion-Related Reactions: Serious hypersensitivity reactions including life-threatening anaphylactic reactions have occurred with Trodelvy. Severe signs and symptoms included cardiac arrest, hypotension, wheezing, angioedema, swelling, pneumonitis, and skin reactions. Hypersensitivity reactions within 24 hours of dosing occurred in 37% of patients. Grade 3-4 hypersensitivity occurred in 2% of patients. The incidence of hypersensitivity reactions leading to permanent discontinuation of Trodelvy was 0.3%. The incidence of anaphylactic reactions was 0.3%. Pre-infusion medication is recommended. Observe patients closely for hypersensitivity and infusion-related reactions during each infusion and for at least 30 minutes after completion of each infusion. Medication to treat such reactions, as well as emergency equipment, should be available for immediate use. Permanently discontinue Trodelvy for Grade 4 infusion-related reactions.

Nausea and Vomiting: Nausea occurred in 66% of all patients treated with Trodelvy and Grade 3 nausea occurred in 4% of these patients. Vomiting occurred in 39% of patients and Grade 3-4 vomiting occurred in 3% of these patients. Premedicate with a two or three drug combination regimen (e.g., dexamethasone with either a 5-HT3 receptor antagonist or an NK1 receptor antagonist as well as other drugs as indicated) for prevention of chemotherapy-induced nausea and vomiting (CINV). Withhold Trodelvy doses for Grade 3 nausea or Grade 3-4 vomiting and resume with additional supportive measures when resolved to Grade ≤1. Additional antiemetics and other supportive measures may also be employed as clinically indicated. All patients should be given take-home medications with clear instructions for prevention and treatment of nausea and vomiting.

Increased Risk of Adverse Reactions in Patients with Reduced UGT1A1 Activity: Patients homozygous for the uridine diphosphate-glucuronosyl transferase 1A1 (UGT1A1)*28 allele are at increased risk for neutropenia, febrile neutropenia, and anemia and may be at increased risk for other adverse reactions with Trodelvy. The incidence of Grade 3-4 neutropenia was 67% in patients homozygous for the UGT1A1*28, 46% in patients heterozygous for the UGT1A1*28 allele and 46% in patients homozygous for the wild-type allele. The incidence of Grade 3-4 anemia was 25% in patients homozygous for the UGT1A1*28 allele, 10% in patients heterozygous for the UGT1A1*28 allele, and 11% in patients homozygous for the wild-type allele. Closely monitor patients with known reduced UGT1A1 activity for adverse reactions. Withhold or permanently discontinue Trodelvy based on clinical assessment of the onset, duration and severity of the observed adverse reactions in patients with evidence of acute early-onset or unusually severe adverse reactions, which may indicate reduced UGT1A1 function.

Embryo-Fetal Toxicity: Based on its mechanism of action, Trodelvy can cause teratogenicity and/or embryo-fetal lethality when administered to a pregnant woman. Trodelvy contains a genotoxic component, SN-38, and targets rapidly dividing cells. Advise pregnant women and females of reproductive potential of the potential risk to a fetus. Advise females of reproductive potential to use effective contraception during treatment with Trodelvy and for 6 months after the last dose. Advise male patients with female partners of reproductive potential to use effective contraception during treatment with Trodelvy and for 3 months after the last dose.

ADVERSE REACTIONS

In the ASCENT study (IMMU-132-05), the most common adverse reactions (incidence ≥25%) were fatigue, neutropenia, diarrhea, nausea, alopecia, anemia, constipation, vomiting, abdominal pain, and decreased appetite. The most frequent serious adverse reactions (SAR) (>1%) were neutropenia (7%), diarrhea (4%), and pneumonia (3%). SAR were reported in 27% of patients, and 5% discontinued therapy due to adverse reactions. The most common Grade 3-4 lab abnormalities (incidence ≥25%) in the ASCENT study were reduced neutrophils, leukocytes, and lymphocytes.

In the TROPHY study (IMMU-132-06), the most common adverse reactions (incidence ≥25%) were diarrhea, fatigue, neutropenia, nausea, any infection, alopecia, anemia, decreased appetite, constipation, vomiting, abdominal pain, and rash. The most frequent serious adverse reactions (SAR) (≥5%) were infection (18%), neutropenia (12%, including febrile neutropenia in 10%), acute kidney injury (6%), urinary tract infection (6%), and sepsis or bacteremia (5%). SAR were reported in 44% of patients, and 10% discontinued due to adverse reactions. The most common Grade 3-4 lab abnormalities (incidence ≥25%) in the TROPHY study were reduced neutrophils, leukocytes, and lymphocytes.

DRUG INTERACTIONS

UGT1A1 Inhibitors: Concomitant administration of Trodelvy with inhibitors of UGT1A1 may increase the incidence of adverse reactions due to potential increase in systemic exposure to SN-38. Avoid administering UGT1A1 inhibitors with Trodelvy.

UGT1A1 Inducers: Exposure to SN-38 may be substantially reduced in patients concomitantly receiving UGT1A1 enzyme inducers. Avoid administering UGT1A1 inducers with Trodelvy.

On August 15, 2022 Navidea Biopharmaceuticals, Inc. (NYSE American: NAVB) ("Navidea" or the "Company"), a company focused on the development of precision immunodiagnostic agents and immunotherapeutics, reported its financial results for the second quarter and year-to-date for the period ended June 30, 2022 (Press release, Navidea Biopharmaceuticals, AUG 15, 2022, View Source [SID1234618377]).

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Second Quarter 2022 Highlights and Subsequent Events

Continued enrollment into the Company’s NAV3-33 Phase 3 trial in rheumatoid arthritis ("RA") titled "Evaluation of Tc 99m Tilmanocept Imaging for the Early Prediction of Anti-TNFα Therapy Response in Patients with Moderate to Severe Active Rheumatoid Arthritis." Enrollment is ongoing across the three currently opened sites.
Announced positive preliminary results from the Company’s ongoing NAV3-32 Phase 2b trial comparing Tc99m tilmanocept imaging to histopathology of joints of patients with active RA. Two non-overlapping classes that align with the fibroid and non-fibroid histological pathotypes were identified, supporting the hypothesis that these classes can be identified by Tc99m tilmanocept imaging.
Received $800,000 from a strategic partner as reimbursement for certain manufacturing and research and development expenses.
The Company’s abstract titled "TAM Targeted Imaging Agents Binding CD206 and Selective Blocking of Off Target Liver Localization" was presented at the Society of Nuclear Medicine and Molecular Imaging Annual Meeting on June 11, 2022 in Vancouver, British Columbia.
The Company’s abstract titled "CD206 Targeted Delivery of Bisphosphonate Payloads Alter Human Macrophage Phenotypes Towards M1-like" was presented at the Tumor Myeloid-Directed Therapies Summit on June 14, 2022 in Boston, MA.
Announced publication of a manuscript titled "Increased Macrophage Specific Arterial Inflammation Relates Uniquely to Non-calcified Plaque and Specific Immune Activation Pathways in People with HIV: A Targeted Molecular Imaging Approach," based on work performed at the Massachusetts General Hospital ("MGH") and Harvard Medical School, Boston MA, and sponsored by the Company. The research, appearing in The Journal of Infectious Diseases (PMID: 35856671), was led by Principal Investigator Steven Grinspoon, MD, Chief of the Metabolism Unit at MGH and Professor of Medicine at Harvard Medical School.
Announced publication of a manuscript titled "Tilmanocept as a novel tracer for lymphatic mapping and sentinel lymph node biopsy in melanoma and oral cancer," based on work performed at the Crown Princess Mary Cancer Centre ("CPMCC") at the University of Sydney, in Sydney, Australia. The research, appearing in the ANZ Journal of Surgery (PMID: 35848587), was led by Principal Investigator Dr. Muzib Abdul-Razak, MBBS, FRACS, FRCSE, MCh., of the Faculty of Medicine, Department of Surgical Oncology and Head and Neck Surgery in the CPMCC at the University of Sydney.
Received notification of issuance of patent from the USPTO for the application titled, "Compounds And Compositions For Treating Leishmaniasis And Methods Of Diagnosis And Treating Using Same" (Patent No. US 11,369,680 B2).
Filed a provisional patent application describing a new degradable linker for dexamethasone and paclitaxel containing Manocept therapeutic constructs. These constructs are being evaluated preclinically for effects on macrophages and in animal models of oncology and inflammatory indications.
Received a Decision of Grant for patent application in Japan for claims related to targeted delivery of a wide range of therapeutic payloads attached to Manocept platform-based constructs using a degradable hydrazone linker.
Closed on a $2.5 million bridge loan from the Company’s Vice Chair of the Board of Directors, John K. Scott, Jr.
Adopted a plan designed to protect the Company’s net operating loss and tax credit carryforwards.
Michael Rosol, Ph.D., Chief Medical Officer for Navidea, said, "The company continues to work diligently to advance the technology in key disease areas, with an emphasis on our RA program. The NAV3-33 Phase 3 and NAV3-32 Phase 2b trials continue to enroll. We are pleased with the preliminary positive results from the NAV3-32 study that thus far support our hypothesis that we can distinguish between fibroid and non-fibroid pathotypes of RA with a single scan." Dr. Rosol continued, "Concurrent with all of this, we continue to make progress in our therapeutics pipeline, and we expect to keep advancing these towards the clinic."

Financial Results

Total net revenues for the second quarter of 2022 were $57,000, compared to $261,000 for the same period in 2021. Total net revenues for the first half of 2022 were $57,000, compared to $385,000 for the same period in 2021. The decrease was primarily due to the 2021 partial recovery of debts previously written off in 2015, the 2021 receipt of reimbursement from Cardinal Health 414, LLC of certain research and development ("R&D") costs, decreased grant revenue related to Small Business Innovation Research grants from the National Institutes of Health supporting Manocept development, and decreased license revenue from transitional sales of Tc99m tilmanocept in Europe.
Research and development expenses for the second quarter of 2022 were $1.7 million, compared to $1.5 million for the same period in 2021. R&D expenses for the first half of 2022 were $2.9 million, compared to $2.7 million for the same period in 2021. The increase was primarily due to increased employee compensation including incentive-based awards and increased recruiting fees, offset by decreases in drug project expenses and regulatory consulting expenses.
Selling, general and administrative ("SG&A") expenses for the second quarter of 2022 were $1.3 million, compared to $1.4 million for the same period in 2021. SG&A expenses for the first half of 2022 were $3.1 million, compared to $3.7 million for the same period in 2021. Decreases in employee compensation including fringe benefits and incentive-based awards, travel, investor relations, general office expenses, facilities costs and franchise taxes were offset by increases in insurance, director fees, losses on the abandonment of certain intellectual property and legal and professional services.
Navidea’s net loss attributable to common stockholders for the second quarter of 2022 was $3.0 million, or $0.10 per share, compared to $2.7 million, or $0.09 per share, for the same period in 2021. Navidea’s net loss attributable to common stockholders for the first half of 2022 was $6.0 million, or $0.20 per share, compared to $5.6 million, or $0.20 per share, for the same period in 2021.
Navidea ended the second quarter of 2022 with $328,000 million in cash and cash equivalents.
The Company’s registration statement on Form S-1 (Registration No. 333-262691) relative to the Company’s current rights offering was declared effective by the Securities and Exchange Commission ("SEC") on August 3, 2022. The prospectus relating to and describing the terms of the rights offering has been filed with the SEC as a part of the registration statement and is available on the SEC’s web site at View Source Copies of the final prospectus for the rights offering may be obtained, when available, from Maxim Group LLC, 300 Park Avenue, New York, NY 10022, Attention Syndicate Department, email: [email protected] or telephone (212) 895-3745.

This press release does not constitute an offer to sell or the solicitation of an offer to buy these securities, nor will there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

In light of the Company’s pending rights offering, the Company will host a second quarter earnings conference call and business update following the conclusion of the rights offering. The Company will issue a press release announcing the date and time of the earnings conference call.

On August 15, 2022 Q32 Bio, a clinical stage biotechnology company developing biologic therapeutics to restore immune homeostasis, and Horizon Therapeutics plc (Nasdaq: HZNP), reported that they have entered into a collaboration and option agreement to develop ADX-914 for the treatment of autoimmune diseases (Press release, Horizon Therapeutics, AUG 15, 2022, View Source [SID1234618376]).

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ADX-914 is a fully human anti-IL-7Rα antibody that re-regulates adaptive immune function by blocking signaling mediated by both IL-7 and TSLP. Q32 has recently completed a biomarker-enabled Phase 1 study characterizing pharmacokinetics, pharmacodynamics and safety of ADX-914 that demonstrated pharmacological effect on T cells in healthy volunteers. Q32 expects to initiate a Phase 2 trial in atopic dermatitis later this year and is planning to initiate a Phase 2 trial in a second autoimmune disease next year.

"Horizon is a leader in the autoimmune and inflammatory disease space and brings to this collaboration both the resources and experience of a pharmaceutical company and the speed and agility of a biotech," said Michael Broxson, chief executive officer of Q32 Bio. "We’re very excited to combine our strengths and expertise to continue to advance ADX-914 for autoimmune diseases, an area that is underserved by existing therapeutics and one where we hope to deliver life-changing medicines for patients in need."

Under the terms of the agreement, Horizon will fund development through completion of the two Phase 2 trials of ADX-914, with Q32 being operationally responsible for the conduct of all program-related activities. Horizon will receive an option to acquire the ADX-914 program, exercisable through a period following completion of the Phase 2 trials. During the option period, Q32 will receive $55 million in the form of initial consideration and staged development funding, of which Horizon expects to recognize as R&D expenses approximately $32.5 million in the third quarter of 2022, and the remainder in 2023.

These payments will be included in Horizon’s non-GAAP financial measures, including adjusted EBITDA. If Horizon exercises the option, Q32 may be eligible to receive up to an additional $645 million in closing and milestone payments, as well as tiered royalties on net sales, less certain amounts payable under a pre-existing license agreement.

"We are very pleased to begin our collaboration with Q32 to advance ADX-914 through the next phase of clinical development," said Elizabeth H.Z. Thompson, Ph.D., executive vice president, research and development, Horizon. "By targeting the IL-7 and TSLP pathways, which are biologically and genetically implicated as central mediators of T cell-mediated pathologies, ADX-914 represents a novel approach to targeting a number of autoimmune diseases with the potential to restore healthy immune regulation."

On August 15, 2022 Novartis reported that the Phase III CANOPY-A study evaluating adjuvant treatment with canakinumab (ACZ885), an inhibitor of interleukin-1beta (IL-1β), in adult patients with stages II-IIIA and IIIB (T>5cm N2) completely resected (R0) non-small cell lung cancer (NSCLC) did not meet its primary endpoint of disease-free survival (DFS) versus placebo1 (Press release, Novartis, AUG 15, 2022, View Source [SID1234618375]). No unexpected safety signals were observed.1 Findings from the trial will be presented at an upcoming medical meeting.

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"We made an investment in the CANOPY program based on signals of reduced lung cancer incidence and mortality observed in the CANTOS study. These positive signals supported the study of canakinumab as adjuvant treatment for early lung cancer," said Jeff Legos, Executive Vice President, Global Head of Oncology & Hematology Development, Novartis. "While we are disappointed CANOPY-A did not show the benefit we hoped for, every trial generates scientific evidence that supports future research and development, and we look forward to continuing to pursue new therapeutic options for people living with lung cancer, whose needs remain urgent and significant. We thank the patients and clinical investigators whose time and commitment made this research possible."

CANOPY-A is a Phase III, multicenter, randomized, double blind study that is evaluating the efficacy and safety of canakinumab as adjuvant treatment in patients with NSCLC stages II-IIIA and IIIB (T>5cm N2), per American Joint Committee on Cancer/The Union for International Cancer Control (AJCC/UICC) 8th edition staging, whose margins are free of cancer following surgery2. In the trial, 1,382 patients were randomized 1:1 to canakinumab, 200 mg subcutaneously every three weeks, or matching placebo for up to one year2. Patients completed standard-of-care adjuvant cisplatin-based chemotherapy and radiation therapy, if applicable, prior to randomization2.

About canakinumab (ACZ885)
Canakinumab is a human monoclonal antibody that binds with high affinity and selectivity to human IL-1β and inhibits IL-1β activity by blocking its interaction with its receptors3-5. By inhibiting IL-1β, preliminary evidence suggests that canakinumab may suppress Pro-Tumor Inflammation to 1) enhance anti-tumor immune response; 2) reduce tumor cell proliferation, survival and invasiveness; and 3) impair angiogenesis5. Pro-Tumor Inflammation enables tumor development by driving cancer-causing processes and suppressing anti-tumor immune responses6,7.

About the CANOPY program
Novartis launched the CANOPY study program after observing significantly lower than expected rates of lung cancer mortality among patients in the Phase III cardiovascular CANTOS trial. The CANTOS trial evaluated canakinumab as a secondary prevention measure for cardiovascular events in patients following a heart attack5,8. Patients in the CANTOS trial also were at high risk for inflammatory cancers like lung cancer due to advanced age, smoking history, and other clinical risk factors5,8. Based on these findings, Novartis launched three large-scale, randomized, Phase III clinical trials and a Phase II clinical trial to investigate canakinumab as a potential treatment option in NSCLC.

Novartis and lung cancer
Lung cancer is one of the most common cancers worldwide, accounting for more than 2 million new cases diagnosed each year9. More people die of lung cancer every year than any other cancer9. There are two main types of lung cancer—small cell lung cancer (SCLC) and non-small cell lung cancer (NSCLC)10. NSCLC accounts for approximately 85% of lung cancer diagnoses11, and 30-55% of patients with early NSCLC develop recurrence despite resection12.

Novartis is committed to working with the scientific and medical communities to reimagine the treatment of lung cancer and pursue advances in medicine that could extend the survival of people living with lung cancer. Novartis is developing experimental therapies that block cancer growth; learning more about ways to activate the body’s immune system; increasing understanding of the relationship between chronic inflammation and tumor growth and progression; and exploring the potential for advanced nuclear medicine to fight the disease.

On August 15, 2022 Nuvo Pharmaceuticals Inc. (TSX:MRV; OTCQX:MRVFF) d/b/a Miravo Healthcare (Miravo or the Company), a Canadian-focused healthcare company with global reach and a diversified portfolio of commercial products, reported its financial and operational results for the three and six months ended June 30, 2022 (Press release, Nuvo Pharmaceuticals, AUG 15, 2022, View Source [SID1234618374]). For further details on the results, please refer to Miravo’s Management, Discussion and Analysis (MD&A) and Condensed Consolidated Interim Financial Statements for the three and six months ended June 30, 2022, which are available on the Company’s website (www.miravohealthcare.com). All figures are in Canadian dollars, unless otherwise noted.

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Key Developments

Three months ended June 30, 2022 include the following:

Total revenue was $20.9 million, an increase of 6% compared to $19.8 million for the three months ended June 30, 2021. Adjusted total revenue(1) was $23.3 million, an increase of 17% compared to $19.9 million for the three months ended June 30, 2021.
Net income was $18.3 million compared to net income of $9.1 million for the three months ended June 30, 2021. Adjusted EBITDA(1) was $10.3 million, an increase of 40% compared to $7.4 million for the three months ended June 30, 2021.
Revenue related to the Blexten franchise, Cambia and Suvexx was $12.8 million, an increase of 34% compared to revenue of $9.5 million for the three months ended June 30, 2021. Total Canadian prescriptions of Blexten, Cambia and Suvexx increased by 17%, 6% and 85%, respectively compared to the three months ended June 30, 2021.
The Company repaid $3.2 million (US$2.5 million) of the Amortization Loan to Deerfield Management Company, L.P. (Deerfield).
As at June 30, 2022, cash and cash equivalents were $28.6 million.
Six months ended June 30, 2022 include the following:

Total revenue was $36.6 million, an increase of 7% compared to $34.2 million for the six months ended June 30, 2021. Adjusted total revenue(1) was $39.1 million, an increase of 13% compared to $34.4 million for the six months ended June 30, 2021.
Net income was $20.3 million compared to net loss of $8.8 million for the six months ended June 30, 2021. Adjusted EBITDA(1) was $13.4 million, an increase of 15% compared to $11.7 million for the six months ended June 30, 2021.
Revenue related to the Blexten franchise, Cambia and Suvexx was $20.9 million, an increase of 36% compared to revenue of $15.4 million for the six months ended June 30, 2021. Total Canadian prescriptions of Blexten, Cambia and Suvexx increased by 18%, 4% and 100%, respectively compared to the six months ended June 30, 2021.
The Company repaid $6.7 million (US$5.3 million) of the Amortization Loan to Deerfield.
(1)

Non-IFRS financial measure. These measures are not recognized under IFRS and do not have standardized meanings prescribed by IFRS. See the Non-IFRS Measures section for definitions, reconciliations and the basis of presentation of the Company’s non-IFRS measures.

Business Update

In August 2022, Miravo announced the appointment of Anthony Snow to its Board of Directors. Mr. Snow has over twenty years of experience investing in and advising public and private companies. Mr. Snow is currently the President and Co-Portfolio Manager of Red Oak Partners, LLC. He also serves as President and a director of CBA Florida, Inc. (previously known as Cord Blood America, Inc.). Prior to joining Red Oak Partners, Mr. Snow worked at Soros Fund Management where he was part of a two-person team that managed a global long/short equity portfolio. Prior to Soros, he also focused on global equities at both Ardea Capital Management, as part of the founding team, and Wyper Capital Management. Previously, Mr. Snow was an Associate at private equity firm Lindsay Goldberg. Mr. Snow began his career at Merrill Lynch & Co. as an Analyst in the Mergers & Acquisitions group. Mr. Snow received a B.B.A. with high distinction from the University of Michigan, concentrating in finance and accounting, and an M.B.A. from Harvard Business School.
In August 2022, Miravo’s U.S. partner for Pennsaid 2% announced it would be winding down the business segment that currently promotes and sells Pennsaid 2% in the U.S. in response to the market erosion resulting from an at-risk launch of a generic version of Pennsaid 2% in May 2022. The Company has conducted a thorough evaluation of its manufacturing operations based in Varennes, Québec, where it manufactures Pennsaid 2%, and has determined that its continued operation of its manufacturing facility is no longer viable as a result of this lost revenue stream. Miravo is exploring strategic alternatives to monetize its manufacturing facility and related intellectual property, while winding down its manufacturing operations. Miravo estimates that prior to any recoveries, its restructuring charges related to the wind-down of its manufacturing operations will be $2.0 million – $2.5 million. The Company anticipates that a wind-down of its manufacturing operations may take 9 – 12 months, depending on various factors, some of which are beyond the Company’s control.
In June 2022, Miravo’s European partner, Orion Corporation (Orion) received marketing authorization for Suvexx packaged in bottles in Denmark, Estonia, Finland, Hungary, Lithuania, Latvia and Sweden (collectively the EU Markets). Orion intends to launch Suvexx in the EU Markets throughout 2023 once marketing authorization for a blister pack format has been obtained in each jurisdiction.
In May 2022, Miravo filed U.S., Canadian, European and PCT patent applications for a reformulated and improved version of Resultz. This new formulation maintains the original treatment claims, but is now enhanced with a 100% effectiveness claim for killing nits (the lice eggs) in addition to head lice. The Company believes this enhanced efficacy against nits adds value to existing Resultz partners, as well as other companies active in the head lice category globally who may be interested in licensing the technology. The Company commenced its partnering process for this new intellectual property during Q2 2022. Additional basic development work is anticipated to be conducted to support the new product.
"Our second quarter was marked by a number of notable events. First, this was the first time our Adjusted EBITDA was more than $10 million in a quarter. This financial milestone was driven by the continued growth of our Commercial Business segment and the continued prescription and sales growth of our promoted products Blexten, Cambia and Suvexx. Second, our European partner, Orion, received marketing authorizations for Suvexx in 7 of the 9 territories they have licensed, and we anticipate the final two authorizations to be obtained in the coming months. This marks the first ex-North American approvals for Suvexx and is a testament to the strength of the regulatory submission prepared by our scientific affairs team. We look forward to a commercial launch of Suvexx in Europe during the first half of 2023," said Jesse Ledger, Miravo’s President & CEO.

Mr. Ledger went on to state, "We remain committed to enhancing profitability and cash flow generation while advancing our strategic growth objectives. After careful review of the cost structure and contribution provided by operating an under-utilized manufacturing facility and considering the recent entry of generic Pennsaid 2% in the U.S., we concluded that the continued operation of our manufacturing facility does not align with our strategic growth objectives. Exiting our involvement with direct manufacturing will improve our gross profit margins and better focus the Company’s efforts and resources on advancing the key growth engines of our business: our Commercial Business and our international Licensing and Royalty Business segments. On behalf of our entire Company, I would like to thank all the employees involved in our manufacturing operations for their significant contributions over the years. The in-house development of both the Pennsaid 1.5% and Pennsaid 2% products and the launch of these products in various territories around the world would not have been possible without the hard work of this very resourceful and resilient team."

Second Quarter 2022 Financial Results
Adjusted total revenue was $23.3 million and $39.1 million for the three and six months ended June 30, 2022 compared to $19.9 million and $34.5 million for the three and six months ended June 30, 2021. The $3.4 million increase in adjusted total revenue in the current quarter was primarily attributable to a $2.4 million increase in revenue from the Commercial Business segment and an increase of $2.3 million (US$1.8 million) for Yosprala-related milestone revenue billed to the Company’s Japanese licensee, offset by a decrease of $1.3 million of revenue from the Production and Service Business segment.

Revenue attributable to the Commercial Business segment increased during the three months ended June 30, 2022 due to a $3.3 million increase in sales of the Company’s promoted products (Blexten, Cambia, Suvexx and Neovisc), offset by a $0.8 million decrease in sales of the Company’s mature products. Revenue attributable to the Commercial Business segment increased during the six months ended June 30, 2022 due to a $5.5 million increase in sales of the Company’s promoted products, slightly offset by a decrease in sales of the segment’s mature products.

The Production and Service Business segment revenue decreased during the three and six months ended June 30, 2022, primarily due to a decrease in the Company’s Pennsaid 2% product sales.

For the three months ended June 30, 2022, the $2.3 million increase in adjusted total revenue in the Licensing and Royalty Business segment was the result of an increase of $2.3 million (US$1.8 million) for Yosprala-related milestone revenue billed to the Company’s Japanese licensee.

Adjusted EBITDA was $10.3 million for the three months ended June 30, 2022 compared to $7.4 million for the comparative quarter. During the three months ended June 30, 2022, a $2.1 million increase in gross profit from the Commercial Business segment and a $2.2 million increase in amounts billed to customers for existing contract assets was offset by a $0.5 million increase in sales and marketing expenses and a $0.8 million decrease in gross profit contribution from the Company’s Production and Service Business segment.

Adjusted EBITDA was $13.4 million for the six months ended June 30, 2022 compared to $11.7 million for the six months ended June 30, 2021. During the six months ended June 30, 2022, a $3.0 million increase in gross profit from the Commercial Business segment and a $2.2 million increase in amounts billed to customers for existing contract assets was offset by a $0.3 million decrease in the contribution from the License and Royalty Business segment, a $1.6 million decrease in gross profit contribution from the Production and Service Business segment, a $0.5 million increase in sales and marketing expenses and a $1.0 million increase in general and administrative expenses.

Non-IFRS Measures
The Company discloses non-IFRS financial measures (adjusted total revenue, adjusted EBITDA, and cash value of loans) and non-IFRS ratios (adjusted EBITDA per share and net debt leverage ratio) that are not recognized under and do not have standardized meanings prescribed by IFRS. Accordingly, such measures are not necessarily comparable and may not have been calculated in the same way as similarly named financial measures presented by other companies. These measures should be considered as supplemental in nature and not as a substitute for related financial information prepared in accordance with IFRS. The Company believes that shareholders, investment analysts and other readers find such measures and ratios helpful in understanding and assessing the Company’s financial performance. We utilize these measures in managing our business, including as means of performance measurement, cash management, debt compliance and assessing leverage and borrowing capacity. Because non-IFRS financial measures and non-IFRS ratios do not have standardized meanings prescribed under IFRS, securities regulations require that such measures be clearly defined, identified, and for non-IFRS financial measures, reconciled to their nearest IFRS measure. The applicable definition, calculation and reconciliation of each such measure used in this press release is provided below.

Adjusted Total Revenue
The Company defines adjusted total revenue as total revenue, plus amounts billed to customers for existing contract assets, less revenue recognized upon recognition of a contract asset. Management believes adjusted total revenue is a useful supplemental measure to determine the Company’s ability to generate cash from its customer contracts used to fund its operations.

The following is a summary of how adjusted total revenue is calculated, reconciled to the nearest IFRS measure

Adjusted EBITDA
EBITDA refers to net income (loss) determined in accordance with IFRS, before depreciation and amortization, net interest expense (income) and income tax expense (recovery). The Company defines adjusted EBITDA as EBITDA, plus amounts billed to customers for existing contract assets, inventory step-up expenses, stock-based compensation expense, loss on fair value of derivative liabilities, loss on fair value of contingent and variable consideration, impairment loss, foreign currency loss, other losses less revenue recognized upon recognition of a contract asset, stock-based compensation recovery, gain on fair value of derivative liabilities, gain on fair value of contingent and variable consideration, impairment recovery, foreign currency gain and other income. Management believes adjusted EBITDA is a useful supplemental measure to determine the Company’s ability to generate cash available for working capital, capital expenditures, debt repayments, interest expense and income taxes.

(1) Income tax expense for the three and six months ended June 30, 2022, includes $1.7 million and $2.0 million for deferred income tax due to the utilization of loss carry forwards that were previously recognized [$1.1 million and $1.4 million for the three and six months ended June 30, 2021]

(2) The Company’s derivative liabilities are measured at fair value through profit or loss at each reporting date. As a result of the decrease in the share price in the current quarter and a decrease in the volatility of the Company’s shares, amongst other inputs, the value of the Company’s derivative liabilities decreased and the Company recognized net non-cash gains of $19.3 million on the change in fair value of derivative liabilities for the three months ended June 30, 2022 [$6.9 million net non-cash gains for the three months ended June 30, 2021]. During the six months ended June 30, 2022 as a result of the decrease in the share price and a decrease in the volatility of the Company’s shares, amongst other inputs, the value of the Company’s derivative liabilities decreased and the Company recognized net non-cash gains of $22.6 million on the change in fair value of derivative liabilities [$11.5 million net non-cash loss for the six months ended June 30, 2021].

(3) In the three and six months ended June 30, 2022, the impairment loss of $0.9 million represented a $46 write-down of certain mature intangible assets and $0.3 million for Resultz goodwill in the Commercial Business segment and a $0.6 million write-down of certain intangible assets in the Licensing and Royalty Business segment.

Management to Host Conference Call/Webcast
Management will host a conference call to discuss the results today (Monday, August 15, 2022) at 11:00 a.m. ET. To participate in the conference call, please dial (416) 764-8646 or 1 (888) 396-8049 / Conference ID: 64633261. Please call in 15 minutes prior to the call to secure a line. You will be put on hold until the conference call begins.

A live audio webcast and replay webcast of the conference call will be available through:

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