On May 4, 2023 ABM Therapeutics, an innovative clinical-stage biopharmaceutical company, with an emphasis on developing drugs with high blood–brain barrier (BBB) penetration for CNS diseases including brain metastases, reported that the first patient was successfully dosed with ABM-168 in the United States (Press release, ABM Therapeutics, MAY 4, 2023, View Source [SID1234631066]).

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MEK (mitogen-activated protein kinase kinase), a key kinase of the MAPK pathway, is frequently activated in various cancers, including those with RAS mutations. These mutations are present in 20% of human cancers and 20-30% of NSCLC. ABM-168, a novel small molecule MEK inhibitor developed by ABM, exhibits good water solubility, high cell permeability and brain penetration. Preclinical studies have clearly demonstrated its anti-cancer properties, particularly in intracranial animal models.

"The dosing of the first patient with ABM-168 in the USA represents another important milestone for ABM. ABM-168 is a strategically important program for ABM’s development of combination therapies," Dr. Chen Chen, founder and CEO of ABM Therapeutics said. "Selective MEK inhibitors have the ability to inhibit tumor growth and induce cell death in RAF- and RAS-mutant cell lines. A MEK inhibitor in combination with a BRAF inhibitor has been demonstrated to be more effective and less toxic than a single BRAF inhibitor, which has become the standard of care for patients with BRAF-mutated melanoma. The combination of a MEK inhibitor with other anti-cancer drugs such as KRAS inhibitors and PD-1/PD-L1 antibodies is also explored. We look forward to the early clinical data which will help us to figure out the most effective combination for treating cancers, particularly those with high brain metastasis rates."

This phase I clinical trial in the US is a first-in-human multicenter, open-label, dose escalation and cohort expansion study, which is intended to assess the safety, tolerability, and pharmacokinetics of ABM-168 monotherapy in adult patients with advanced/metastatic solid tumors.

"We are very pleased to reach our study’s first patient dosed milestone at NEXT Oncology – Dallas, one of the clinical trial centers for this novel MEK inhibitor and collaborate with all study sites and investigators," said Dr. Zane Yang, CMO of ABM, "ABM will strive for ABM-168 clinical development to fulfill unmet medical needs and offer more therapeutic options. This makes a major step for our mission, passionate about developing drugs and improving patients’ quality of life."

As a clinical-stage biotechnology company, ABM Therapeutics has built a broad pipeline to construct a robust proprietary Brain-Penetrant Kinase Drug Discovery Platform (BPKddTM). Its first drug candidate ABM-1310, the next generation of BRAF inhibitor, is under clinical studies in both the US and China and has shown good safety profile including tolerability. ABM Therapeutics is in the process of Series B+ round financing, and looks forward to cooperating with international pharmaceutical companies, domestic and foreign biopharmaceutical companies, and securities and funds.

About ABM-168

ABM-168 is a novel small molecule MEK inhibitor with high water solubility, cell and brain permeability. It has demonstrated anti-cancer efficacy in vitro in multiple cancer cell lines and in vivo in multiple xenograft animal models. It was granted clearance of the Investigational New Drug (IND) application to proceed with the first-in-human clinical trial in October 2022 by the US FDA. More information about ABM’s ongoing ABM-168 trial is available at View Source (NCT 05831995) and on the company website at www.abmtx.com.

On May 5, 2023 INOVIO (NASDAQ: INO), a biotechnology company focused on developing and commercializing DNA medicines to help treat and protect people from HPV-related diseases, cancer, and infectious diseases, reported that Jacqueline Shea, Ph.D., President and CEO, will present at the 2023 RBC Capital Markets Global Healthcare Conference (Press release, Inovio, MAY 4, 2023, View Source [SID1234631065]).

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2023 RBC Capital Markets Global Healthcare Conference
Date: Wednesday, May 17, 2023
Time: 4:05 PM ET
Format: Fireside Chat

During the conference, Dr. Shea and members of INOVIO’s management team will conduct one-on-one meetings with registered investors.

A webcast of the presentation will be available on the INOVIO Investor Relations Events page at View Source A replay of the webcast will be available for 90 days after the date of the presentation.

On May 4, 2023 Arvinas, Inc. (Nasdaq: ARVN), a clinical-stage biotechnology company creating a new class of drugs based on targeted protein degradation, reported financial results for the first quarter ended March 31, 2023 and provided a corporate update (Press release, Arvinas, MAY 4, 2023, View Source [SID1234631064]).

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"We made substantial progress throughout the first quarter across all areas of our early- and late-stage pipeline," said John Houston, Ph.D., president and chief executive officer at Arvinas. "Preliminary data from the ongoing Phase 1b combination study of vepdegestrant with palbociclib reinforce our confidence in the potential of vepdegestrant as an important treatment option in metastatic breast cancer. Together with Pfizer, we are on-track to initiate the safety lead-in to identify the dose of palbociclib for the planned Phase 3 trial with vepdegestrant and palbociclib. For bavdegalutamide, we are also on track to initiate a phase 3 trial in the second half of 2023, and we plan to share radiographic progression free survival data from the Phase 1/2 trial in the second half of 2023 as well. We look forward to progressing our clinical programs and new clinical candidates in the coming years."

Recent Developments and 1Q Business Highlights

Evaluated preliminary data (November 2022 cutoff) from Part C of the ongoing Phase 1b/2 ARV-471-mBC-101 study (ClinicalTrials.gov Identifier: NCT04072952).
Preliminary results from the Part C dose escalation (the Phase 1b combination of vepdegestrant + palbociclib 125 mg) demonstrate an observed clinical benefit rate (CBR; rate of confirmed complete response, confirmed partial response, or stable disease ≥24 weeks) of 60.7% (95% CI, 40.6 – 78.5) across all dose cohorts (17 of 28 CBR-evaluable patients; patients are CBR-evaluable if they received their first dose >24 weeks prior to the cut-off). Data are expected to be presented at a medical conference in the second half of 2023.
85.7% of the 28 CBR-evaluable patients had received CDK4/6 inhibitor therapy prior to study entry.
An increase in palbociclib exposure was observed relative to historical palbociclib pharmacokinetic data.
A similar overall safety profile was observed compared with that reported in previous palbociclib and endocrine therapy combination studies, except for a higher incidence of grade 3/4 neutropenia, which was managed by monitoring and dose modification per the palbociclib label. Patients were started on palbociclib 125 mg irrespective of dose reduction during prior CDK4/6 inhibitor therapy.
Gained alignment with the U.S. Food and Drug Administration on an approach for the planned 1L Phase 3 trial (VERITAC-3) with vepdegestrant (200 mg) in combination with palbociclib.
The safety lead-in is on-track to initiate in 2H 2023 and will start with a lead-in to evaluate the best starting dose of palbociclib (100 mg or 75 mg) in combination with vepdegestrant 200 mg once daily.
The objective is to select a dose of palbociclib (100 mg or 75 mg) that, when dosed with vepdegestrant 200 mg, results in a similar exposure and safety profile as palbociclib 125 mg in combination with aromatase inhibitors.
Continued enrollment in the VERITAC-2 Phase 3 2L+ clinical trial of vepdegestrant as a monotherapy for the treatment of patients with ER+/HER2- metastatic breast cancer (ClinicalTrials.gov Identifier: NCT05654623).
Continued enrollment in the TACTIVE-U study (vepdegestrant in combination with abemaciclib or ribociclib, (ClinicalTrials.gov Identifiers: NCTC05548127 and NCTC05573555), the TACTIVE-E study (vepdegestrant in combination with everolimus; ClinicalTrials.gov Identifier: NCT05501769), and the TACTIVE-N study (vepdegestrant as a monotherapy in the neoadjuvant setting; ClinicalTrials.gov Identifier: NCT05549505).
Announced the inclusion of vepdegestrant in the I-SPY-2 (Investigation of Serial studies to Predict Your Therapeutic Response with Imaging And moLecular analysis 2) trial sponsored by Quantum Leap. The I-SPY-2 Endocrine Optimization Platform (EOP) study (Identifier: NCT01042379) will include a vepdegestrant monotherapy arm and a vepdegestrant plus letrozole arm.
Presented vepdegestrant pre-clinical data at American Association for Cancer Research (AACR) (Free AACR Whitepaper) annual meeting in April 2023 demonstrating:
The potential utility of vepdegestrant as an endocrine therapy backbone for combination with other targeted agents in early and late-stage ER+/HER2- breast cancer.
The potential mechanisms of acquired resistance to vepdegestrant that may be associated with alterations within Receptor Tyrosine Kinase/MAPK signaling pathways rather than ER signaling or E3 ligase machinery.
Presented new in vivo and in vitro data at AACR (Free AACR Whitepaper) – Targeting RAS Special Conference demonstrating:
Arvinas’ KRAS G12D PROTAC degraders are potent, selective and led to tumor stasis in a mouse xenograft model with intermittent dosing.
Degradation of KRAS G12D provides an advantage vs. inhibition in vitro and in vivo.
Presented new ARV-766 preclinical data and compound structure at the AACR (Free AACR Whitepaper) annual meeting in April 2023.
Presented new preclinical data at the CHDI Foundation’s Annual Huntington’s Disease Therapeutics Conference showing that Arvinas PROTAC degraders potently and selectively degrade soluble mutant huntingtin (mHTT) in multiple cellular readouts, including rodent neurons, while sparing wild-type HTT.
Appointed Kelly Page as Senior Vice President, Global Head of Oncology Strategy and Program Leadership.
Announced that Timothy Shannon, M.D., our current Chairperson and a member of our board of directors since July 2013, will not be standing for re-election at the Annual Meeting.
"Tim’s support, guidance and unwavering dedication has been instrumental in our success since our founding 10 years ago," continued Dr. Houston. "We are grateful for his years of service on the Board, and on behalf of the entire Company, we thank Tim for his strategic insight, wisdom and integrity – all of which are ingrained in our work as we make progress towards improving the lives of patients with serious diseases."

Anticipated Upcoming Milestones and Expectations

Vepdegestrant (ARV-471)
As part of Arvinas’ global collaboration with Pfizer, the companies plan to:

Initiate the safety lead-in to identify the dose of palbociclib for the planned Phase 3 trial with vepdegestrant + palbociclib as a first-line treatment in patients with ER+/HER2- locally advanced or metastatic breast cancer (2H 2023).
Submit and present additional data from the Phase 1b combination trial with palbociclib (ClinicalTrials.gov Identifier: NCT04072952) at a medical congress (2H 2023).
Initiate additional arms of the Phase 1b combination umbrella trial (TACTIVE-U: ClinicalTrials.gov Identifiers: NCTC05548127 and NCTC05573555) with other targeted therapies (2H 2023).
Complete enrollment for VERITAC-2 Phase 3 monotherapy trial (ClinicalTrials.gov Identifier: NCT05654623) in patients with metastatic breast cancer (2H 2024).
Androgen Receptor (AR) Franchise (Bavdegalutamide/ARV-110, ARV-766)

Share data from the Phase 1 dose escalation trial with ARV-766 in metastatic castration-resistant prostate cancer (mCRPC) (2Q 2023).
Submit and present additional data, including radiographic progression free survival, from the ongoing Phase 1/2 trial with bavdegalutamide at a medical congress (2H 2023).
Initiate a global Phase 3 trial with bavdegalutamide in mCRPC for patients with AR T878/H875 tumor mutations (2H 2023).
Complete enrollment in the Phase 1b combination study with bavdegalutamide plus abiraterone (2H 2023).
Initiate a Phase 1b or Phase 2 trial in patients who have not previously received novel hormonal agents (2H 2023).
Pipeline:

Submit two investigational new drug (IND)/clinical trial authorization (CTA) applications for the Company’s BCL6 (oncology) and LRRK2 (neuroscience) PROTAC protein degraders by year-end 2023.
Progress at least two additional PROTAC protein degrader programs into IND- or CTA-enabling studies by year-end 2023.
Financial Guidance
Based on its current operating plan, Arvinas believes its cash, cash equivalents, restricted cash and marketable securities as of March 31, 2023, is sufficient to fund planned operating expenses and capital expenditure requirements into 2026.

First Quarter Financial Results

Cash, Cash Equivalents, Restricted Cash and Marketable Securities Position: As of March 31, 2023, cash, cash equivalents, restricted cash and marketable securities were $1,129.0 million as compared with $1,210.8 million as of December 31, 2022. The decrease in cash, cash equivalents, restricted cash and marketable securities of $81.8 million for the three months ended March 31, 2023 was primarily related to cash used in operations of $87.9 million (net of $2.5 million received from two collaborators), loss on the sale of marketable securities of $0.9 million and the purchase of lab equipment and leasehold improvements of $1.1 million, partially offset by unrealized gains on marketable securities of $6.6 million and proceeds from the exercise of stock options of $1.5 million.

Research and Development Expenses: Research and development expenses were $95.3 million for the quarter ended March 31, 2023, as compared with $64.0 million for the quarter ended March 31, 2022. The increase in research and development expenses of $31.3 million for the quarter was primarily due to an increase in our continued investment in our platform and exploratory programs of $18.3 million, as well as an increase in expenses related to our AR program of $3.5 million, which includes bavdegalutamide and ARV-766, and our ER program of $9.5 million, which is net of the cost sharing of vepdegestrant (ARV-471) under the global Pfizer collaboration agreement to develop and commercialize vepdegestrant that was initiated in July 2021 (ARV-471 Collaboration Agreement).

General and Administrative Expenses: General and administrative expenses were $24.9 million for the quarter ended March 31, 2023, as compared with $20.2 million for the quarter ended March 31, 2022. The increase of $4.7 million was primarily due to an increase in personnel costs of $2.3 million and professional fees of $1.4 million.

Revenues: Revenues were $32.5 million for the quarter ended March 31, 2023, as compared with $26.5 million for the quarter ended March 31, 2022. Revenue is related to the ARV-471 Collaboration Agreement, the license and rights to technology fees and research and development activities related to the collaboration and license agreement with Bayer that was initiated in July 2019, the collaboration and license agreement with Pfizer that was initiated in January 2018, the amended and restated option, license and collaboration agreement with Genentech that was initiated in November 2017 and revenue related to our Oerth Bio joint venture which was initiated in July 2019. The increase in revenues of $6.0 million was primarily due to an increase in revenue from the ARV-471 Collaboration Agreement totaling $15.9 million, partially offset by a net decrease in revenue totaling $8.2 million due to extensions of the period of revenue recognition under both the Pfizer and Bayer collaboration agreements and a decrease of $1.2 million of previously constrained deferred revenue related to our Oerth Bio joint venture.

Income Tax Expense: Income tax benefit was $0.4 million for the quarter ended March 31, 2023, as compared with an income tax expense of $4.5 million for the quarter ended March 31, 2022. Current year tax benefit was driven by expected benefits from state net operating loss carryback claims. Prior year tax expense was driven by revenue recognized in 2022 for tax purposes from the ARV-471 Collaboration Agreement.

Loss from Equity Method Investment: Loss from equity method investment was $1.1 million for the quarter ended March 31, 2023, as compared with $2.3 million for the quarter ended March 31, 2022 due to decreased operating losses incurred by Oerth Bio.

Net Loss: Net loss was $81.9 million for the quarter ended March 31, 2023, as compared with $63.4 million for the quarter ended March 31, 2022. The increase in net loss for the quarter was primarily due to increased research and development expenses and general and administrative expenses, partially offset by decreased income tax expense and increased revenue.

About bavdegalutamide (ARV-110)
Bavdegalutamide (ARV-110) is an investigational orally bioavailable PROTAC protein degrader designed to selectively target and degrade the androgen receptor (AR). Bavdegalutamide is being developed as a potential treatment for men with mCRPC.

Bavdegalutamide has demonstrated activity in preclinical models of AR mutation or overexpression, both common mechanisms of resistance to currently available AR-targeted therapies.

About vepdegestrant (ARV-471)
Vepdegestrant is an investigational, orally bioavailable PROTAC protein degrader designed to specifically target and degrade the estrogen receptor (ER) for the treatment of patients with early and locally advanced or metastatic ER positive/human epidermal growth factor receptor 2 (HER2) negative (ER+/HER2-) breast cancer. Use of vepdegestrant in the ongoing and planned clinical trials will continue to monitor and evaluate patient safety and anti-tumor activity.

In preclinical studies, vepdegestrant demonstrated up to 97% ER degradation in tumor cells, induced tumor shrinkage when dosed as a single agent in multiple ER-driven xenograft models, and showed increased anti-tumor activity when compared to a standard of care agent, fulvestrant, both as a single agent and in combination with a CDK4/6 inhibitor. In July 2021, Arvinas announced a global collaboration with Pfizer for the co-development and co-commercialization of vepdegestrant; Arvinas and Pfizer will equally share worldwide development costs, commercialization expenses, and profits.

On May 4, 2023 Merus N.V. (Nasdaq: MRUS) (Merus, the Company, we, or our), a clinical-stage oncology company developing innovative, full-length multispecific antibodies (Biclonics and Triclonics), reported financial results for the first quarter and provided a business update (Press release, Merus, MAY 4, 2023, View Source [SID1234631063]).

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"We were thrilled to share the robust interim clinical results for petosemtamab, our first in class bispecific antibody targeting EGFR and LGR5 in patients with previously treated head and neck squamous cell carcinoma at AACR (Free AACR Whitepaper)," said Bill Lundberg, M.D., President, Chief Executive Officer of Merus. "We are advancing our petosemtamab program diligently toward a registration-directed study in head and neck cancer. We expect our strong cash position to continue to fund the company meaningfully beyond several near-term clinical milestones and program updates, and into the second half of 2025."

Petosemtamab (MCLA-158: EGFR x LGR5 Biclonics): Solid Tumors
Enrollment continues in dose expansion in the phase 1/2 trial, including in combination with Keytruda (pembrolizumab)

Petosemtamab is in clinical development in the expansion part of a phase 1/2 open-label, multicenter trial in advanced solid tumors, including previously treated head and neck squamous cell carcinoma (HNSCC). The Company also initiated a cohort investigating petosemtamab in combination with Keytruda in patients with untreated HNSCC, designed to evaluate safety and clinical activity in this population.

In April, Merus provided an interim clinical update at the AACR (Free AACR Whitepaper) Annual Meeting 2023. As of the February 1, 2023 data cutoff date, 49 previously treated HNSCC patients (pts) were treated with petosemtamab at the recommended phase 2 dose of 1500 mg intravenous every two weeks. Patients had experienced a median of 2 (range 1-4) prior lines of systemic therapy including PD-(L)1 inhibitor in 96% of pts, chemotherapy in 94% and platinum-based chemotherapy in 92% of pts; 2 pts received prior cetuximab. 43 pts were evaluable for efficacy, receiving ≥2 treatment cycles (≥8 weeks) with ≥1 post-baseline tumor assessment or experiencing early progressive disease. The overall response rate was 37.2% (16/43; 95% CI 23%-53.3%) by RECIST 1.1. per investigator assessment, including 15 confirmed partial responses and 1 confirmed complete response (ongoing after 20 months). Median duration of response was 6.0 months (95% CI 3.7-NC), with 10 of 16 (62.5%) responders ongoing at the time of the data cutoff. Median progression free survival was 5.3 months (95% CI 3.7-6.8); with 29 of 43 pts progressing and 14 of 43 pts censored. Median overall survival was 11.5 months (95% CI 7.2-20.6); with 29 of 49 pts still alive at the data cutoff date. Petosemtamab continued to demonstrate a manageable safety profile.

Merus met with the U.S. Food and Drug Administration (FDA) in an end-of-phase meeting to discuss interim results from the previously treated HNSCC cohort of the petosemtamab phase 1/2 trial. The FDA recognized recurrent or metastatic HNSCC represents an area of unmet medical need, and provided clear recommendations for the path to potential registration.

Based on the strong clinical data and discussions with the FDA, Merus believes a randomized clinical trial in previously treated (2L/3L) or untreated (front-line) HNSCC may support a possible registration. Additionally, Merus believes a randomized registration trial in HNSCC with an overall response rate endpoint could potentially support accelerated approval and the overall survival results from the same study could potentially verify its clinical benefit to support regular approval. The Company plans to continue to acquire data to confirm a suitable dose for future randomized clinical trials. Merus plans to provide an update in Q3 2023 on the potential registrational path for this program.

Zenocutuzumab (Zeno or MCLA-128: HER2 x HER3 Biclonics): NRG1+ cancer and other solid tumors
Enrollment continues in the eNRGy trial of Zeno monotherapy in NRG1+ cancer; and a phase 2 trial of Zeno in combination with androgen deprivation therapy (ADT) in castration resistant prostate cancer (CRPC), and in combination with afatinib in NRG1+ non-small cell lung cancer (NSCLC)

Merus plans to provide an update on the potential registrational path and timeline in NRG1+ cancer in the first half of 2023 and a clinical update on Zeno in NRG1+ cancer at a major medical conference in 2023.

Further, Merus is evaluating Zeno in combination with an ADT (enzalutamide or abiraterone) in men with CRPC, irrespective of NRG1+ status. Merus plans to provide initial clinical data on Zeno in CRPC in the second half of 2023.

Merus is also evaluating Zeno in combination with afatinib in patients with NRG1+ NSCLC.

MCLA-129 (EGFR x c-MET Biclonics): Solid Tumors
Enrollment continues in the expansion cohorts in the phase 1/2 trial; clinical update planned for 2H23

MCLA-129 is in clinical development in a phase 1/2, open-label clinical trial evaluating MCLA-129 monotherapy in patients with EGFR ex20 NSCLC, MET ex14 NSCLC, and in HNSCC, as well as MCLA-129 in combination with Tagrisso (osimertinib), a third generation EGFR TKI, in patients with treatment-naïve EGFR mutant (m) NSCLC and in patients with EGFRm NSCLC that have progressed on Tagrisso.

In April, Merus provided a pre-clinical presentation of MCLA-129 in comparison with amivantamab at the AACR (Free AACR Whitepaper) Annual Meeting 2023. The Company plans to provide an initial clinical data update from the expansion cohorts, and a further clinical development strategy update in the second half of 2023.

MCLA-129 is subject to a collaboration and license agreement with Betta Pharmaceuticals Co. Ltd. (Betta), which permits Betta to develop MCLA-129 and potentially commercialize exclusively in China, while Merus retains global rights outside of China.

MCLA-145 (CD137 x PD-L1 Biclonics): Solid Tumors
Enrollment continues in the phase 1 trial including in combination with Keytruda (pembrolizumab), a PD-1 inhibitor

MCLA-145 is in clinical development in a global, phase 1, open-label, clinical trial evaluating MCLA-145 in patients with solid tumors. The trial consists of a dose escalation phase, followed by a dose expansion phase. Merus is also evaluating the combination of MCLA-145 with Keytruda, with enrollment ongoing.

Collaborations

Incyte Corporation
Since 2017, Merus has been working together with Incyte Corporation (Incyte) under a global collaboration and license agreement focused on the research, discovery and development of bispecific antibodies utilizing Merus’ proprietary Biclonics technology platform. The agreement grants Incyte certain exclusive rights for up to ten bispecific and monospecific antibody programs. The collaboration is progressing, with multiple programs in various stages of preclinical and clinical development. For each program under the collaboration, Merus receives reimbursement for research activities and is eligible to receive potential development, regulatory and commercial milestones and sales royalties for any products, if approved. Further, Incyte announced, in 2023, that INCA32459, a novel Lag3xPD-1 bispecific antibody developed through the collaboration is currently being evaluated in clinical studies. In January 2023, Merus achieved a milestone payment of $2.5 million related to this program.

Loxo Oncology at Lilly
In January 2021, Merus and Loxo Oncology at Lilly, a research and development group of Eli Lilly and Company (Lilly), announced a research collaboration and exclusive license agreement to develop up to three CD3-engaging T-cell re-directing bispecific antibody therapies utilizing Merus’ Biclonics platform and proprietary CD3 panel along with the scientific and rational drug design expertise of Loxo Oncology at Lilly. The collaboration is progressing with multiple active research programs underway.

Cash Runway, existing cash, cash equivalents and marketable securities expected to fund Merus’ operations into second half 2025
As of March 31, 2023, Merus had $287.3 million cash, cash equivalents and marketable securities. Based on the Company’s current operating plan, the existing cash, cash equivalents and marketable securities are expected to fund Merus’ operations into second half 2025.

Annual General Meeting and Board of Directors
The Company’s annual general meeting of shareholders is planned to be held on May 26, 2023.

First Quarter 2023 Financial Results
We ended the first quarter with cash, cash equivalents and marketable securities of $287.3 million compared to $326.7 million at December 31, 2022. The decrease was primarily the result of cash used to fund the operations.
Collaboration revenue for the three months ended March 31, 2023 increased by $1.8 million as compared to the three months ended March 31, 2022, primarily as a result of an increase from an Incyte milestone met of $2.5M partially offset by lower cost reimbursement revenue.

Research and development expense for the three months ended March 31, 2023 increased by $7.9 million as compared to the three months ended March 31, 2022, primarily as a result of an increase in clinical and manufacturing costs related to our programs and stock-based compensation.

General and administrative expense for the three months ended March 31, 2023 increased by $3.6 million as compared to the three months ended March 31, 2022, primarily as a result of increases in consulting costs of $2.3 million, facilities costs of $0.8 million and personnel related expenses including stock-based compensation.

Other income (loss), net consists of interest earned and fees paid on our cash and cash equivalents held on account, accretion of investment earnings and net foreign exchange (losses) gains on our foreign denominated cash, cash equivalents and marketable securities. Other gains or losses relate to the issuance and settlement of financial instruments.

On May 4, 2023 Moderna, Inc. (NASDAQ:MRNA), a biotechnology company pioneering messenger RNA (mRNA) therapeutics and vaccines, reported financial results and provided business updates for the first quarter of 2023 (Press release, Moderna Therapeutics, MAY 4, 2023, View Source [SID1234631062]).

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"We had a strong first quarter, with $1.9 billion in revenue, clearly indicating that we are on our way to deliver on the $5 billion of signed Advance Purchase Agreements for 2023. In addition, we are encouraged by the progress of new COVID-19 vaccine contracts in the U.S. for this fall with pharmacy chains, hospital networks and multiple U.S. government agencies. Similar discussions are ongoing with Japan, the EU, and other key markets such as Australia, which recently ordered additional COVID-19 vaccines," said Stéphane Bancel, Chief Executive Officer of Moderna. "At AACR (Free AACR Whitepaper), we presented detailed results for the treatment of melanoma with our individualized neoantigen therapy in combination with Keytruda, showing a 44% reduction of recurrence or risk of death in melanoma compared to Keytruda alone. These data could represent a profound change in the treatment of melanoma, and we are quickly beginning Phase 3 trials in melanoma as well as lung cancer. We also are pleased with our progress in rare disease, where we have now advanced to the dose-expansion phase of our investigational mRNA therapy for propionic acidemia, and have upcoming interim data being shared at ASGCT (Free ASGCT Whitepaper) this month. At the same time, we are fully preparing for potential commercial launches of two products in 2024, our RSV and flu vaccines."

Recent progress includes:

Respiratory Vaccines
Moderna’s respiratory pipeline includes Phase 3 trials against RSV, influenza, and a next-generation COVID-19 candidate. The pipeline includes four additional influenza vaccines with expanded antigens, vaccines against other respiratory pathogens (e.g., hMPV), and six combination vaccine programs.

Commercial and Phase 3 trials

COVID-19
According to current FDA guidance for COVID-19 vaccination, individuals who are 65 years of age or older and those who are immunocompromised are now eligible to receive an additional dose. New COVID-19 vaccination recommendations are expected from the FDA following the upcoming June strain-selection meeting.

Moderna’s next-generation, refrigerator-stable COVID-19 vaccine, mRNA-1283, has demonstrated encouraging results in multiple clinical studies and recently began dosing participants in a Phase 3 trial.

RSV
Moderna’s RSV vaccine candidate, mRNA-1345, met its primary efficacy endpoint in older adults, and topline data were released in the first quarter. Additional updates were presented at recent medical conferences (RSVVW and ECCMID), demonstrating consistently high efficacy across the clinical spectrum of RSV disease in adults aged 60 years and up. No cases of Guillain-Barré syndrome (GBS) or other demyelinating events have been reported among mRNA-1345 trial participants to date. Based on these results, Moderna expects to submit for regulatory approval.

Flu
The Company’s first influenza vaccine candidate, mRNA-1010, is currently being evaluated in Phase 3 trials. A Phase 3 trial (P301) was conducted in the Southern Hemisphere to evaluate safety and non-inferior immunogenicity compared to a licensed flu vaccine; interim results from that study were previously announced in February. An additional Phase 3 trial (P302) is being conducted in the Northern Hemisphere to evaluate safety and non-inferior efficacy compared to a licensed flu vaccine. The independent DSMB has completed the first interim analysis of efficacy and informed the company that mRNA-1010 did not meet the statistical threshold necessary to declare early success and recommended that the trial continues with efficacy follow-up towards the next analysis. The DSMB did not identify any safety concerns.

A preliminary analysis of immunogenicity from a subset of participants in the P302 trial has also been completed. In this analysis, mRNA-1010 demonstrated geometric mean titer ratios consistent with superiority against both influenza A strains (A/H1N1, A/H3N2) and consistent with non-inferiority against both influenza B strains (B/Victoria, B/Yamagata) relative to the licensed comparator. The P302 study will continue until the end of the current flu season.

The Company has also initiated a Phase 3 immunogenicity trial (P303) to test an updated formulation of mRNA-1010 that is expected to lead to improved immune responses against influenza B strains and is intended to enable licensure of mRNA-1010 through accelerated approval.

Combination Respiratory Vaccines
The Phase 1/2 trial of mRNA-1083, targeting COVID-19 + flu, using the Company’s next-generation COVID-19 vaccine candidate, mRNA-1283, and seasonal flu vaccine candidate mRNA-1010, has initiated enrollment.

Latent Virus Vaccines
Phase 3 trial
The pivotal Phase 3 study of Moderna’s CMV vaccine candidate (mRNA-1647), known as CMVictory, is ongoing, with enrollment more than 50% complete. The adolescent trial for mRNA-1647 has dosed its first participants.

Therapeutics
The Company’s therapeutics portfolio spans immuno-oncology, rare diseases, autoimmune diseases, and cardiovascular diseases.

Immuno-oncology
Moderna and Merck’s recent announcement and presentation at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) on April 16, 2023, demonstrated that the Phase 2b KEYNOTE-942/mRNA-4157-P201 trial of mRNA-4157/V940, an investigational individualized neoantigen therapy, in combination with pembrolizumab met the primary efficacy endpoint of improving recurrence-free survival (RFS) versus standard of care pembrolizumab for the adjuvant treatment of patients with stage III/IV melanoma following complete resection. Adjuvant treatment with mRNA-4157/V940 in combination with pembrolizumab reduced the risk of recurrence or death by 44% (HR=0.56 [95% CI, 0.31-1.08]; one-sided p-value=0.0266) compared with pembrolizumab alone. The 12-month RFS rate was 83.4% (95% CI, 74.7-89.3) and 77.1% (95% CI, 62.5-86.6) in the combination and control arms, respectively. The 18-month RFS rate was 78.6% (95% CI, 69.0-85.6) and 62.2% (95% CI, 46.9-74.3) in the combination and control arms, respectively.

A second AACR (Free AACR Whitepaper) presentation reviewed data from a subgroup analysis to assess RFS in biomarker-high and -low subgroups across study arms. Irrespective of tumor mutational burden (TMB) status, the results indicate that targeting an individual patient’s unique tumor mutations with mRNA-4157/V940 demonstrates improved RFS when administered in combination with pembrolizumab compared to pembrolizumab monotherapy. The association between TMB and mRNA-4157/V940 treatment effect will be further explored in upcoming planned studies.

Moderna and Merck plan to discuss results with regulatory authorities, initiate a Phase 3 study in melanoma in 2023, and rapidly expand to additional tumor types, including non-small cell lung cancer (NSCLC).

Rare diseases: Propionic Acidemia
The Phase 1/2 open-label, dose optimization trial of mRNA-3927, an mRNA therapeutic candidate for propionic acidemia (PA), has advanced to the dose-expansion phase to further evaluate safety and efficacy, and confirm the recommended dose for future clinical studies. This trial includes a dose optimization stage (cohorts 1-5), followed by a dose expansion stage with progression dependent on the safety of the preceding cohort. A total of 257 doses have been administered with no dose-limiting toxicities or study discontinuations due to drug-related treatment-emergent adverse events. Five of the 15 study participants have been dosed with over one year of continuous treatment. All eligible participants have elected to continue with treatment by participating in the Open-Label Extension Study. Interim data will be presented at the American Society of Gene & Cell Therapy (ASGCT) (Free ASGCT Whitepaper) on May 18, 2023.

Moderna now has 47 programs1 in development across 45 development candidates, of which 36 are currently in active clinical trials. The Company’s updated pipeline can be found at www.modernatx.com/pipeline. Moderna and collaborators have published more than 140 peer-reviewed publications.

First Quarter 2023 Financial Results

Revenue: Total revenue for the first quarter of 2023 was $1.9 billion, compared to $6.1 billion in the same period in 2022, mainly due to a decrease in sales of the Company’s COVID-19 vaccines. Product sales for the first quarter of 2023 were $1.8 billion, a decrease of 69%, compared to the same period in 2022, primarily driven by lower sales volume.

Cost of Sales: Cost of sales for the first quarter of 2023 was $792 million. In addition to unit driven manufacturing costs, this includes royalties of $86 million and the following charges: $148 million for inventory write-downs related to excess and obsolete COVID-19 products, unutilized manufacturing capacity of $135 million, and losses on firm purchase commitments and related cancellation fees of $95 million. These charges, other than royalties, were driven by costs associated with surplus production capacity and an overall lower demand forecast, primarily for lower income countries. Cost of sales as a percent of product sales was 43% of product sales, compared to 17% in the first quarter of 2022. The increase was driven by the aforementioned charges over lower product sales compared to the prior year, and higher manufacturing cost as the Company switched to smaller dose vials compared to the prior year, as well as lower product sales to absorb fixed manufacturing costs.

Research and Development Expenses: Research and development expenses for the first quarter of 2023 increased by 104% to $1.1 billion, in comparison to the same quarter of 2022. The growth in spending was mainly due to an increase in clinical trial-related expenses, largely driven by increased clinical development activities, particularly with respect to the Company’s RSV, seasonal flu and CMV programs. The growth was also driven by an increase in personnel-related costs, due to increased headcount to support research and development efforts, and the Company’s recently announced collaboration agreements with Life Edit and Generation Bio.

Selling, General and Administrative Expenses: Selling, general and administrative expenses for the first quarter of 2023 increased by 14% to $305 million, in comparison to the first quarter of 2022. The growth in spending was primarily due to increases in outside services spend and personnel-related costs, driven by commercial activities in support of the Company’s marketed products and expansion.

Income Taxes: Income tax benefit for the first quarter of 2023 was $384 million, driven by the Company’s full year outlook, which includes research and development credits, international provisions, and non-recurring items.

Net Income: Net income was $79 million in the first quarter of 2023, compared to net income of $3.7 billion for the first quarter of 2022.

Earnings Per Share: Diluted earnings per share was $0.19 in the first quarter of 2023, compared to diluted earnings per share of $8.58 for the first quarter of 2022.

2023 Commercial Updates

COVID-19: COVID-19 vaccine sales to Europe were $0.6 billion and sales to the rest of the world were $1.3 billion in the first quarter. The total of $1.8 billion in sales represents the vast majority of the projected $2 billion in sales from 2022 deferrals expected in the first half of 2023.2 The Company reiterates its expectation of 2023 minimum sales of approximately $5.0 billion from previously announced COVID-19 vaccine Advanced Purchase Agreements. The Company estimates the U.S. annual COVID-19 market to be 100 million doses. The Company is in active supply discussions for new orders for fall of 2023 in the U.S., Japan, and the EU In the U.S., this could include:

Contracting with national/regional pharmacies, healthcare systems, government health providers (Veteran’s Affairs, Centers for Disease Control and Prevention, Department of Defense, etc.), occupational health providers, employers, physicians
Contracting with Group Purchasing Organizations (GPOs) and Physician Buying Groups (PBGs)
Establishing a national distribution infrastructure via Moderna Direct ecommerce site and distribution agreements with national wholesalers & distributors
Utilizing a global supply chain to provide our COVID-19 vaccine in single-dose vials and pre-filled syringes in time to meet vaccination needs this fall
In further support of its COVID-19 vaccine commercial launch, the Company is establishing fall campaigns to support vaccinations alongside annual flu campaigns, partnering with the customer base to assist with identifying patients and simplify the vaccination experience, and utilizing an omni-channel approach to reach healthcare providers.

Respiratory Franchise:As previously announced at Vaccines Day, the Company is preparing for six potential major vaccine launches with expected annual sales of $8-15 billion by 2027 from the respiratory franchise (COVID-19, RSV, Flu and combinations).

RSV: The Company continues to expect a 2024 launch of its RSV vaccine and is undertaking a number of activities to raise awareness of the health and economic burden of RSV, including by presenting detailed data of its Phase 3 study at major medical meetings (RSVVW/ECCMID), with future presentations planned. The Company continues to be encouraged by payer, NITAG and key opinion leader feedback and has begun manufacturing the mRNA for its RSV vaccine in pre-filled syringes.

INT: The Company is identifying eligible cancer patient populations to potentially benefit from its individualized neoantigen therapy.

2023 Financial Framework

Advance Purchase Agreements (APAs): The Company has COVID-19 vaccine sales of approximately $5 billion currently contracted for 2023 delivery. The Company is in negotiations for additional COVID-19 vaccine orders in key markets, including the U.S., Japan, and the EU. Australia also recently ordered additional COVID-19 vaccines. The Company continues to expect total product sales in the first half of 2023 of approximately $2.0 billion (second quarter 2023 sales are expected to be between $0.2-$0.3 billion).

Cost of Sales: The company continues to expect cost of sales for the full year in the range of approximately 35-40% of product sales. For the second quarter 2023, the Company expects cost of sales between $0.5-$0.6 billion.

Research & Development (R&D) and Selling, General & Administrative (SG&A) Expenses: The Company continues to expect full-year 2023 expenses of approximately $6.0 billion, with approximately $4.5 billion in R&D.

Income Taxes: The Company now anticipates a full year tax benefit of $0.3-$0.5 billion, driven by R&D credits, international provisions, and nonrecurring items.

Capital Expenditures: The Company continues to expect to make capital investments for 2023 of approximately $1.0 billion.

Corporate Updates
Continued Growth:

Moderna had approximately 4,350 employees as of March 31, 2023, compared to approximately 3,200 employees as of March 31, 2022.
Moderna also announced plans to open new offices in Seattle, WA to provide technology solutions across the enterprise, and in South San Francisco, CA to focus on additional research and development within Moderna Genomics.
Corporate Development:

Moderna and Generation Bio announced a strategic collaboration to develop non-viral genetic medicines
Moderna and Life Edit Therapeutics announced a strategic collaboration to accelerate the development of novel in vivo gene editing therapies
Moderna and CytomX announced a strategic research collaboration for mRNA-based conditionally activated therapeutics
Moderna completed its acquisition of OriCiro Genomics in the first quarter 2023
Company Accolades: Moderna has been recognized as a Great Place to Work in the U.S. by Great Place To Work

Key 2023 Investor and Analyst Event Dates

R&D Day: September 13
ESG Day: December 7
Investor Call and Webcast Information
Moderna will host a live conference call and webcast at 8:00 a.m. ET on May 4, 2023.To access the live conference call via telephone, please register at the link below. Once registered, dial-in numbers and a unique pin number will be provided. A live webcast of the call will also be available under "Events and Presentations" in the Investors section of the Moderna website.

Telephone: https://register.vevent.com/register/BI58bd807860ad4c289a8ce03ab024b978
Webcast: View Source
The archived webcast will be available on Moderna’s website approximately two hours after the conference call and will be available for one year following the call.