On August 11, 2022 Illumina, Inc. (Nasdaq: ILMN) reported its financial results for the second quarter of fiscal year 2022, which include consolidated financial results for GRAIL (Press release, Illumina, AUG 11, 2022, View Source [SID1234618180]).

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"Our second quarter results did not meet our expectations as challenges in a complex macroeconomic environment more than offset the growth we continue to see in sequencing runs on our platforms," said Francis deSouza, Chief Executive Officer. "As we strategically navigate these dynamics, we continue to advance our innovation roadmap in support of our long-term growth trajectory. At our upcoming Illumina Genomics Forum and Investor Day events, we look forward to showcasing our breakthrough technologies that demonstrate the power and potential of genomics."

Second quarter consolidated results

(a) See the tables included in "Results of Operations – Non-GAAP" section below for reconciliations of these GAAP and non-GAAP financial measures.

(b) Consolidated financial results for GRAIL are included in Q2 2022, but not in Q2 2021, as GRAIL was acquired on August 18, 2021.

During the second quarter of 2022, Illumina recognized $609 million in legal contingencies, including an accrual of $453 million, recorded in Q2 2022, for the potential fine that the European Commission may impose of up to 10% of our consolidated annual revenues and an estimated accrual of $156 million, also recorded in Q2 2022, related to the settlement of our litigation with BGI in July 2022.

Capital expenditures for free cash flow purposes were $71 million during the second quarter of 2022. Cash flow from operations was $125 million, compared to $253 million in the prior year period, with the year-over-year decrease primarily attributable to GRAIL’s operating loss. Free cash flow (cash flow used in operations less capital expenditures) was $54 million for the quarter, compared to $209 million in the prior year. Depreciation and amortization expenses were $93 million during the second quarter of 2022. At the close of the quarter, the company held $1,327 million in cash, cash equivalents and short-term investments, compared to $1,339 million as of January 2, 2022.

Second quarter segment results
Following the acquisition of GRAIL on August 18, 2021, Illumina has two reportable segments, Core Illumina and GRAIL. GRAIL financial results are reflected for the period after the acquisition.

(a) See Table 3 included in "Results of Operations – Non-GAAP" section below for reconciliations of these GAAP and non-GAAP financial measures.

(b) Core Illumina revenue for Q2 2022 was up 3% from Q2 2021, and up 4% on a constant currency basis. Amount for Q2 2022 includes intercompany revenue of $6 million, which is eliminated in consolidation.

(a) See Table 3 included in "Results of Operations – Non-GAAP" section below for a reconciliation of these GAAP and non-GAAP financial measures.

Key announcements by Illumina since Illumina’s last earnings release

Unveiled DRAGEN v4.0, Illumina’s most accurate and comprehensive secondary analysis platform, boosting capabilities in key areas including oncology, pharmacogenomics, single-cell sequencing, and population genomics with a single platform
Launched Research Use Only (RUO) TruSight Oncology 500 HRD test codeveloped with Merck to enable researchers to unlock deeper insights about the tumor genome, and introduced new pan-cancer companion diagnostic (CDx) for TSO Comprehensive EU, codeveloped with Bayer, to match patients with rare genetic mutations to targeted therapies
Partnered with Allegheny Health Network to assess in-house comprehensive cancer genomic profiling (CGP) to enhance patient care
Announced new 2×300 base pair read lengths on NextSeq 1000 and 2000 systems, new data on Infinity long-read technology and developments in informatics solutions at AGBT General Meeting
Announced inaugural Illumina Genomics Forum with 45 speakers, including former U.S. President Barack Obama, technologist, business leader, and philanthropist Bill Gates, and other leaders in genomics and healthcare from around the world
Received validation of net-zero targets by the Science Based Targets Initiative (SBTi), among first companies in the world
Appointed Joydeep Goswami, Chief Strategy and Corporate Development Officer, as Interim Chief Financial Officer
A full list of recent Illumina announcements can be found in the company’s News Center.

Key announcements by GRAIL since Illumina’s last earnings release

Enrolled 140,000 participants in NHS-Galleri trial, largest study of multi-cancer early detection test
Announced strategic collaboration with AstraZeneca to develop companion diagnostic tests and identify patients with high-risk, early-stage disease who could benefit from novel therapies
Expanded offering of Galleri across the U.S. through partnerships with Mercy, one of the 25 largest U.S. health systems, Community Health Network in the Midwest, with Ochsner Health, the largest Gulf South health system, and with Intermountain Healthcare in Utah
Partnered with Fountain Health Insurance to offer Galleri as part of annual wellness benefits
Collaborated with U.S. Dept. of Veterans Affairs and Veterans Health Foundation to provide Galleri to 10,000 veterans across the U.S. over next 3 years
Named Best Overall Medical Device Company in 2022 MedTech Breakthrough Awards
A full list of recent GRAIL announcements can be found in GRAIL’s Newsroom.

Financial outlook and guidance
The non-GAAP financial guidance discussed below reflects certain pro forma adjustments to assist in analyzing and assessing our core operational performance, including our Core Illumina and GRAIL segments. Please see our Reconciliation of Consolidated Non-GAAP Financial Guidance included in this release for a reconciliation of these GAAP and non-GAAP financial measures.

For fiscal 2022, the company now expects consolidated revenue growth in the range of 4% to 5%. We now expect GAAP diluted loss per share of $(2.93) to $(2.78) and non-GAAP diluted earnings per share of $2.75 to $2.90. The GAAP and non-GAAP diluted (loss) earnings per share guidance ranges continue to assume that the R&D expense capitalization requirement implemented by the Tax Cuts and Jobs Act of 2017 will be repealed or deferred in the fourth quarter of 2022. If the R&D expense capitalization requirement is not repealed or deferred in 2022, the company’s tax expense will be negatively impacted.

Core Illumina revenue growth is now expected to be in the range of 3.5% to 4.5%. GRAIL revenue is now expected to be in the range of $50 million to $70 million.

Conference call information
The conference call will begin at 2 p.m. Pacific Time (5 p.m. Eastern Time) on Thursday, August 11, 2022. Interested parties may access the live teleconference through the Investor Info section of Illumina’s website under the "Company" tab at www.illumina.com. Alternatively, individuals can access the call by dialing 866.409.1555 or +1.313.209.4906 outside North America, both using conference ID 6659694. To ensure timely connection, please dial in at least ten minutes before the scheduled start of the call.

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

On August 11, 2022 Regulus Therapeutics Inc. (Nasdaq: RGLS), a biopharmaceutical company focused on the discovery and development of innovative medicines targeting microRNAs (the "Company" or "Regulus"), reported financial results for the second quarter ended June 30, 2022 and provided a corporate update (Press release, Regulus, AUG 11, 2022, View Source [SID1234618179]).

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"This has been an exciting quarter, which culminated in the achievement of multiple milestones. We continue to make steady progress with RGLS8429, evidenced by the dosing of the first subject in our Phase 1 SAD study," commented Jay Hagan, CEO of Regulus. "Moreover, we are pleased to have Dr. Amin Kamel join the Regulus team at this pivotal moment. We are proud of the work our team is doing to advance our novel therapeutic candidate for ADPKD patients, and we look forward to providing additional updates on progress in the coming quarters."

Program Updates

RGLS8429 for ADPKD: In early June 2022, the Company announced the dosing of the first subject in its Phase 1 SAD study of RGLS8429 for the treatment of ADPKD. The study will assess the safety, tolerability, and pharmacokinetics of RGLS8429 in healthy volunteers. The Company subsequently plans to initiate a Phase 1b multiple ascending dose (MAD) study to assess safety, tolerability, and pharmacokinetics of RGLS8429 in adult patients with ADPKD, and evaluate the efficacy of RGLS8429 treatment across three different dose levels measuring changes in polycystins, cystic kidney volume (htTKV), and overall kidney function.

In late June, the Company announced that FDA had granted ODD to RGLS8429 for the treatment of ADPKD. The FDA’s Office of Orphan Products Development grants orphan designation status to drugs and biologics that are intended for the safe and effective treatment, diagnosis or prevention of rare diseases, or conditions that affect fewer than 200,000 people in the U.S. Orphan designation status is intended to facilitate drug development for rare diseases and may provide several benefits to drug developers, including financial incentives, to support clinical development and the potential for up to seven years of market exclusivity in the U.S. upon regulatory approval.

Corporate Highlights

Expanded Team: In June 2022, the Company announced the appointment of Amin Kamel, Ph.D., as Vice President, DMPK. Most recently, Dr. Kamel was the Scientific Director, DMPK at Takeda, where he also served as a scientific advisor. Prior to Takeda, Dr. Kamel held positions at Biogen, Novartis, and Pfizer.

Financial Results

Cash, Cash Equivalents and Marketable Securities: As of June 30, 2022, Regulus had $47.5 million in cash, cash equivalents and marketable securities.

Research and Development (R&D) Expenses: Research and development expenses were $4.7 million and $8.4 million for the three and six months ended June 30, 2022, respectively, compared to $4.2 million and $7.5 million for the same periods in 2021, respectively. These amounts reflect internal and external costs associated with advancing our pipeline.

General and Administrative (G&A) Expenses: General and administrative expenses were $2.5 million and $5.4 million for the three and six months ended June 30, 2022, respectively, compared to $2.5 million and $5.0 million for the same periods in 2021, respectively. These amounts reflect personnel-related and ongoing general business operating costs.

Net Loss: Net loss was $7.3 million, or $0.50 per share (basic and diluted), and $14.0 million, or $0.96 per share (basic and diluted), for the three and six months ended June 30, 2022, compared to $6.0 million, or $0.78 per share (basic and diluted), and $12.0 million, or $1.62 per share (basic and diluted), for the same periods in 2021.

Conference Call and Webcast Information:

The Company will host a conference call and live audio webcast today at 5:00 p.m. Eastern Daylight Time to discuss its second quarter 2022 financial results and corporate update. To access the call, please dial (866) 652-5200 (domestic) or (412) 317-6060 (international). To access the telephone replay of the call, dial (877) 344-7529 (domestic) or (412) 317-0088 (international) and refer to the entry replay code 5578933. The webcast and telephone replay will be archived on the Company’s website at www.regulusrx.com following the call.

About ADPKD

Autosomal Dominant Polycystic Kidney Disease (ADPKD), caused by mutations in the PKD1 or PKD2 genes, is among the most common human monogenic disorders and a leading cause of end-stage renal disease. The disease is characterized by the development of multiple fluid filled cysts primarily in the kidneys, and to a lesser extent in the liver and other organs. Excessive kidney cyst cell proliferation, a central pathological feature, ultimately leads to end-stage renal disease in approximately 50% of ADPKD patients by age 60. Approximately 160,000 individuals are diagnosed with the disease in the United States alone, with an estimated global prevalence of 4 to 7 million.

About RGLS8429

RGLS8429 is a novel, next generation oligonucleotide for the treatment of ADPKD designed to inhibit miR-17 and to preferentially target the kidney. Administration of RGLS8429 has shown robust data in preclinical models, where clear improvements in kidney function, size, and other measures of disease severity have been demonstrated along with a superior pharmacologic profile in preclinical studies compared to Regulus’ first-generation compound. Regulus is currently conducting a Phase 1 single-ascending dose study in healthy volunteers to assess safety, tolerability, and pharmacokinetics of RGLS8429. In June 2022, FDA granted ODD for RGLS849 for the treatment of ADPKD.

On August 11, 2022 Citius Pharmaceuticals, Inc. ("Citius" or the "Company") (Nasdaq: CTXR), a late-stage biopharmaceutical company developing and commercializing first-in-class critical care products, reported business and financial results for the third fiscal quarter of 2022 ended June 30, 2022 (Press release, Citius Pharmaceuticals, AUG 11, 2022, View Source [SID1234618178]).

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Fiscal Q3 2022 Business Highlights and Subsequent Developments

Mino-Lok Phase 3 trial recruitment approached pre-Covid-19 pace; international trial sites engaged to accelerate trial enrollment; Company reiterates 92 failure events required for trial completion;
Halo-Lido Phase 2b trial initiated; enrollment completion anticipated by end of 2022;
I/ONTAK (denileukin diftitox) topline results show no new safety signals and are consistent with prior formulation (ONTAK);
Pre-BLA meeting held with the FDA for I/ONTAK; biologics license application (BLA) remains on track for submission in the second half of 2022; and,
Announced intention to spinoff I/ONTAK into standalone oncology-focused publicly traded company.
Financial Highlights

Cash and cash equivalents of $48.0 million as of June 30, 2022;
R&D expenses were $4.9 million and $13.8 million for the three and nine months ended June 30, 2022, respectively, compared to $2.2 million and $9.9 million for the three and nine months ended June 30, 2021, respectively;
G&A expenses were $3.0 million and $9.0 million for the three and nine months ended June 30, 2022, respectively, compared to $3.4 million and $ 7.4 million for the three and nine months ended June 30, 2021, respectively;
Stock-based compensation expense was $1.0 million and $2.9 million for the three and nine months ended June 30, 2022, respectively, compared to $0.4 million and $1.0 million for the three and nine months ended June 30, 2021, respectively; and,
Net loss was $8.9 million and $25.6 million, or ($0.06) and ($0.18) per share for the three and nine months ended June 30, 2022, respectively, compared to a net loss of $7.3 million and $19.5 million, or ($0.05) and ($0.20) per share for the three and nine months ended June 30, 2021, respectively.
"Citius made solid progress during the quarter to advance our multiple programs. We expanded the Phase 3 Mino-Lok trial to include international sites with the intention of increasing and accelerating enrollment. Our efforts remain focused on driving patient recruitment, which we believe will hasten trial completion. Based on the current the pace of enrollment and the ramp up of our international sites, we expect to enroll the last patient, to complete the trial by the end of 2022, subsequently with the required number of events," stated Leonard Mazur, Chairman and CEO of Citius.

"Our I/ONTAK program remains on track with an anticipated BLA submission later this year. Topline results for the Phase 3 trial of I/ONTAK were consistent with the prior FDA-approved formulation (ONTAK) and we believe there remains a significant unmet medical need in the market for CTCL patients. We recently completed a pre-BLA meeting with the U.S. Food and Drug Administration (FDA) and appreciate their continued guidance. Additionally, the Halo-Lido Phase 2b trial for the treatment of hemorrhoids was initiated during the quarter and we remain encouraged that we may complete enrollment in this trial by the end of the year," added Mazur.

"Our balance sheet remains strong with $48 million in cash available and no debt, providing us with greater strategic and financing flexibility than many of our peers. We believe these funds are sufficient to allow us to execute our activities through August 2023. To support our value-creating clinical, regulatory and commercial efforts, and to further unlock the value of I/ONTAK and Citius, we announced our intent to explore a tax-free non-dilutive spin-off to create a separate publicly traded oncology company. We believe this remains a viable option, notwithstanding recent market volatility, and will continue to monitor market conditions as we proceed. In addition to a potential spin-off, there are multiple other non-dilutive options available to Citius including out-licensing agreements, asset sales or other strategic arrangements, as well as debt financing. Consequently, we remain encouraged in the progress of our pipeline and confident in our ability to advance each of our key programs," concluded Mazur.

THIRD QUARTER ENDED JUNE 30, 2022 Financial Results:

Liquidity

As of June 30, 2022, the Company had $48.0 million in cash and cash equivalents, no debt, and 146,129,630 common shares issued and outstanding.

The Company estimates that its available cash resources will be sufficient to fund its operations through August 2023.

Research and Development (R&D) Expenses

R&D expenses were $4.9 million and $13.8 million for the three and nine months ended June 30, 2022, respectively, compared to $2.2 million and $9.9 million for the comparable periods ended June 30, 2021. The increase during the quarter is primarily due to additional R&D expenses related to the expansion of the Mino-Lok trial to include sites outside the United States, start-up costs associated with the Halo-Lido Phase 2b trial which enrolled its first patient in April, 2022, and R&D expenses related to I/ONTAK for which a BLA submission to the FDA is being prepared.

During the nine months ended June 30, 2022, ARDS-related R&D expenses decreased by $4.7 million compared to $5.3 million during the prior year period. R&D expense for the nine months ended June 30, 2021 reflected a $5.0 million license fee paid to Novellus.

We expect that research and development expenses will increase in fiscal 2022 as we continue to focus on our Phase 3 trials for Mino-Lok and I/ONTAK, progress the Halo-Lido product candidate, and continue our research and development efforts related to ARDS and Mino-Wrap.

General and Administrative (G&A) Expenses

G&A expenses were $3.1 million and $9.0 million for the three and nine months ended June 30, 2022, respectively, compared to $3.4 million and $7.4 million for the comparable periods ended June 30, 2021. The decrease during the quarter is primarily due to reduced costs for performance bonuses. The primary reasons for the increase over the nine-month period were additional compensation costs for new employees, increased investor relations costs and additional insurance expense. General and administrative expenses consist primarily of compensation costs, professional fees for legal, regulatory, accounting, and corporate development services, and investor relations expenses.

Stock-based Compensation Expense

For the fiscal quarter ended June 30, 2022, stock-based compensation expense was $1.0 million as compared to $0.4 million for the prior year period. For the nine months ended June 30, 2022, stock-based compensation expense was $2.9 million as compared to $1.0 million for the nine months ended June 30, 2021. The increase primarily reflects expenses related to new grants made by Citius to employees (including new hires), directors and consultants.

Net loss

Net loss was $8.9 million, or ($0.06) per share for the three months ended June 30, 2022, compared to a net loss of $5.8 million, or ($0.05) per share for the three months ended June 30, 2021.

Net loss was $25.6 million, or ($0.18) per share for the nine months ended June 30, 2022, compared to a net loss of $18.1 million, or ($0.20) for the nine months ended June 30, 2021.

The increase in net loss is primarily due to an increase in research and development expenses, general and administrative expenses and stock-based compensation.

On August 11, 2022 WuXi Advanced Therapies (WuXi ATU), a wholly owned subsidiary of WuXi AppTec, reported a licensing agreement with Janssen Biotech, Inc., one of the Janssen Pharmaceutical Companies of Johnson & Johnson ("Janssen") (Press release, WuXi ATU, AUG 11, 2022, View Source [SID1234618177]). Under this agreement, WuXi ATU will license to Janssen its TESSA technology, a high-performance system that can produce 10 times more adeno-associated viral (AAV) vectors than traditional AAV manufacturing systems. Janssen will also have access to work on WuXi ATU’s proprietary clonal suspension HEK293 cell line. This agreement was facilitated by Johnson & Johnson Innovation.

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AAV vectors are commonly used for the delivery of gene therapies to patients due to their ability to transduce numerous cell and tissue types. WuXi ATU’s TESSA technology responds to industry demand for large scale AAV manufacturing by producing higher quality AAV particles more efficiently. WuXi ATU has also successfully scaled up the TESSA technology to 200L; this achieved a 10-fold higher yield and a significantly higher percentage of full AAV capsids, greatly reducing overall AAV production costs compared to traditional plasmid-based AAV production systems.

"We are honored that Janssen selected WuXi ATU’s TESSA technology." said Dr. David Chang, Chief Executive Officer of WuXi Advanced Therapies. "We remain committed to improving the TESSA platform to produce faster and more cost-effective AAV products for patients."

As a Contract Testing, Development and Manufacturing Organization (CTDMO) with global operations, WuXi ATU will continue to enhance its capability and capacity to help customers develop and deliver life-changing cell and gene therapies faster for patients in need.

On August 11, 2022 NextRNA Therapeutics, a biotechnology company unlocking the potential of non-coding RNAs to develop novel and transformative therapeutics, reported the appointment of Dominique Verhelle, PhD, MBA as the Chief Executive Officer (Press release, NextRNA Therapeutics, AUG 11, 2022, View Source [SID1234618175]). Dominique is a co-founder of NextRNA who has led the scientific and corporate strategy since its launch over the past year and a half.

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"Dominique is an exceptional leader who brings over 20 years of R&D, company building, and management experiences. She has rapidly built NextRNA’s unique platform and capabilities to identify and develop small molecule drugs to disrupt non-coding RNA-protein interactions. Early achievements at the company have enabled Dominique to secure $56M in financing. Her leadership will be central in our mission to translate pioneering science into first-in-class small molecules for this new emerging field," said Bobby W. Sandage, Jr. PhD, Lead Director of NextRNA Therapeutics and Managing Director at the Paula and Rodger Riney Foundation and Lightchain Capital, LLC who co-led the company’s Series A.

Prior to NextRNA, Dominique was formerly the Head of Academic Innovation, Center for External Innovation at Takeda Pharmaceutical Company (NYSE: TAK). She played a significant role accelerating innovation by building partnerships with academic investigators around the world. Dominique was previously a Principal at Third Rock Ventures, where she played an instrumental role in launching Fulcrum Therapeutics (Nasdaq: FULC) and Cedilla Therapeutics. She was a Director Epigenetics at Pfizer (NYSE: PFE) in the Oncology Research Unit. Before that, she held several positions at Celgene where she contributed to the understanding of the mechanism of action of IMiDs and established the internal epigenetic group.

"I am honored to take on the role of CEO at NextRNA," said Dominique. "I am excited about the tremendous progress we are making on our two lead programs and our proprietary target and drug discovery engine. I look forward to expanding our team and capabilities as we build and advance our pipeline of non-coding RNA-directed medicines."

NextRNA is also excited to announce the appointment of Jason Katz as VP, Head of Drug Discovery, who joins NextRNA after 5 years as Sr Director of Medicinal Chemistry at IFM Therapeutics and 13 years of drug discovery experience at Merck & Co. At IFM Therapeutics, Jason worked on several programs targeting the innate immune system, including the team that developed a suite of NLRP3 antagonists that were acquired by Novartis and advanced into Phase 2 clinical trials. At Merck, Jason and his teams discovered and advanced into clinical development molecules addressing challenging oncology and immuno-oncology targets.