On August 1, 2023 Astellas reported the financial results for the first three months (April 1, 2023 – June 30, 2023) of the fiscal year 2023 ending March 31, 2024 (FY2023) (Press release, Astellas, AUG 1, 2023, View Source [SID1234634650]).

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On August 1, 2023 Recordati reported the interim financial statements as of June 30th, 2023, pursuant to Art. 154-ter of Italian Legislative Decree 58/1998 and subsequent amendments, prepared in accordance with said Decree and the CONSOB Issuers Regulation (Press release, Recordati, AUG 1, 2023, View Source [SID1234633836]). The statements were prepared in accordance with International Accounting Standard (IAS) 34 requirements for interim reporting, based on the assessment, measurement and recognition criteria set by the IFRSs. The interim financial statements on June 30th , 2023 – as well as the Independent Auditors’ report on such statements – will be available within the legal deadline at the company’s offices and on the company’s website (www.recordati.com) and can also be viewed on the authorized storage system 1Info (www.1Info.it).

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Financial highlights
Consolidated net revenue in the first half of the year was € 1,044.3 million, +17.0% vs H1 2022 or +15.4% on a like-for-like(3) basis at CER, driven by strong momentum across all businesses and the successful integration of EUSA Pharma. These results have been achieved despite strong FX headwinds over recent months, with an adverse FX impact in H1 of € 29.7 million (-3.3%) mainly affecting Specialty & Primary Care, and the unwinding, in Q2, of part of the sales phasing benefits posted in the first quarter. Our Specialty & Primary Care portfolio contributed revenues of € 668.9 million in the first six months of 2023, growing 15.0% at CER (+8.8% Türkiye excluded), ahead of the reference markets, driven by all the main therapeutic areas, with particularly strong cough and cold sales in Q1. Revenue of the rare diseases segment in the first half of 2023 totaled € 344.4 million, up 32.2% (or 15.5% on a like-for-like(3) basis at CER) versus same period of prior year, reflecting the integration of the rare oncology products acquired with EUSA Pharma, which contributed revenues of € 95.6 million (growing by 13.1% on a pro-forma basis(3)), a continued growth in sales of Signifor and Isturisa (totalling € 110.6 million, up 38.2%), with resilient sales of our metabolic franchise, thanks to strong growth of Panhematin and limited erosion of generic products in US.

Adjusted operating income(4) of €338.2 increased by 22.8% compared to the first half in 2022, with a ratio to sales of 32.4%, reflecting the robust revenue performance , with continued strong cost discipline and efficiency initiatives offsetting the impact of inflation, investment behind new franchises and increased amortisation charges of € 9.8 million (mainly from the consolidation of EUSA Pharma in the second quarter of 2022). Operating income was € 313.4 million, up 34.9% over the same period of the previous year; this reflects gross margin-related charges arising from the fair value step up of acquired EUSA Pharma inventory of € 20.9 million (vs € 16.9 million in 2022), and non-recurring costs of € 3.9 million, significantly reduced vs 2022 levels, mainly arising from streamlining activities within the sales area of Specialty and Primary Care.

EBITDA(1) was € 406.2 million, up 21.3% compared to the first half of 2022, and with a margin on revenue of 38.9% (vs 37.5% in the first half of 2022), reflecting the operational leverage benefit and previously announced efficiency initiatives, together with a significant resilience of adjusted gross margin, which remained broadly in line with previous year.

Adjusted net income(2) was € 287.4 million, +27.9% over the same period in 2022, at 27.5% of revenue. In addition to the higher operating income this benefits from lower net financial charges of € 24.6 million in the first half, down € 13.6 million compared to the same period of the previous year, with positive effect of FX gains and losses (€ 4.7 million gains in 2023 vs € 18.7 million losses in 2022, mainly driven by the volatility of the Russian rouble), more than off-setting increased interest expenses. Net income was € 227.6 million, up 50.3% over the same period in 2022, at 21.8% of revenue, reflecting also significantly lower non-recurring expenses.

Free cash flow(5) was € 261.7 million for the period, significantly above the same period of last year (up by € 43.0 million), absorbing increase in working capital, driven by higher revenue, and higher cash interest expense.

The net financial position(6) as of June 30th 2023 recorded net debt of € 1,326.2 million, or 1.8x EBITDA, compared to net debt of € 1,419.9 million on December 31st 2022. During the period, USD 20 million of residual Isturisa milestones to Novartis and dividends for € 127.0 million were paid.

Shareholders’ equity was € 1,609.2 million.

Management Comments
"We delivered a strong financial performance in the first half of the year, with continued growth across the business and ongoing delivery of sector-leading margins. The Company is going into the second half of 2023 with very strong underlying momentum and continued ability to convert revenue growth into profits and cashflow. We are also particularly pleased with the agreement signed with GSK in July, which adds two well established brands to our core urology portfolio in Specialty & Primary Care, leveraging our competitive commercial platform to address different patient needs. This deal reflects the successful execution of our strategy to date and strengthens the position of our group for future growth," commented Chief Executive Officer Rob Koremans.

Corporate development news and other key events
On June 27th, the Chinese Medicines Agency (NMPA) approved the marketing of the drug Carbaglu. The launch is expected in early 2024.

As part of the development path aimed to obtain FDA approval of a Biologics License Application (BLA) for the registration of Qarziba in the United States, preparatory activities are ongoing for a Type C Meeting with the FDA, expected in second half of 2023. Planned phase II study for pasireotide in the treatment of Post-Bariatric Hypoglycemia is on track to start in the third quarter of 2023. Patient enrolment in the global phase II study in neurotrophic keratitis for REC 0559 is proceeding according to plan, with data read out expected in the second quarter of 2024. Finally, our focus and efforts in driving our ESG strategy have been further recognized in June 2023, with confirmation of our inclusion in the FTSE4GOOD Index series and of our "Platinum" rating by EcoVadis.

Subsequent events
On July 20th, Recordati announced an agreement with GSK to commercialize Avodart (dutasteride) and Combodart/Duodart (dutasteride/tamsulosin) across 21 countries, mainly in Europe, excluding only those where GSK already has a distribution agreement in place. Avodart and Combodart/Duodart are marketed products, presented as oral form (capsules), indicated for the treatment of moderate to severe symptoms of benign prostatic hyperplasia (BPH) and for the reduction in the risk of acute urinary retention (AUR) and surgery in patients with moderate to severe symptoms of BPH. Avodart and Combodart/Duodart are leading and well-established brands, post loss of exclusivity, that enlarge and complete Recordati’s proven presence in the urology space, significantly reinforcing the competitiveness of its offer. Both brands are synergistic with Recordati’s urology portfolio, complementing Urorec and Eligard. The two products have been commercialized by GSK in the territories licensed to Recordati, with annual sales in 2022 in the region of approximately € 115 million. Recordati made an upfront payment of € 245 million and will start recognizing revenue and margins on a country-by-country basis progressively upon completion of the relevant transition activities, with first transitions expected in Q3 2023 and most to be finalized by end of Q4 2023. As announced, the deal is expected to be fully accretive by 2024 and will deliver €10-20 million of revenue in 2023 with positive EBITDA.

Business outlook
Given the continued strong performance of the Group, despite the significant increase in FX headwinds (FY estimate now -4% vs prior -2%), we confirm the improved guidance for FY 2023 as provided on May 11, with overall revenue of between € 2,050 million and € 2,090 million, EBITDA(1) of between € 750 and € 770 million and adjusted net income(2) of between € 490 and € 500 million.

On August 1, 2023 Merck & Co reported its Second-Quarter 2023 Financial Results (Press release, Merck & Co, AUG 1, 2023, View Source [SID1234633832]).

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On August 1, 2023 Recently, a researcher at Children’s Hospital Los Angeles developed a new way to diagnose retinoblastoma by sampling the fluid at the front of the eye (Press release, Children’s Hospital Los Angeles, AUG 1, 2023, View Source [SID1234633615]). These liquid biopsies also offer genetic and chromosomal information, which gives a more complete picture of each child’s disease. Now CHLA will lead an international liquid biopsy retinoblastoma study, the first of its kind.

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Jesse Berry, MD, is the Director of Ocular Oncology and the Retinoblastoma Program at CHLA. Once strictly a clinician, Dr. Berry transitioned to research with the goal of finding a better way to diagnose retinoblastoma. This cancer—which affects the light-sensing layer at the back of the eye—is extremely aggressive and can result in loss of one or both eyes if not treated quickly. But timely treatment depends on a timely and accurate diagnosis.

Most cancers are diagnosed with a biopsy: An oncologist samples tumor cells and performs various tests to confirm the type of cancer. Unfortunately, this cannot be done with retinoblastoma. "It isn’t a solid mass, like some cancers," says Dr. Berry. "It’s like a thick liquid, and it’s difficult to physically get to." Attempts to directly biopsy the tumor, she explains, can do more harm than good, potentially causing cancer cells to spread. Not only does this make diagnosing the cancer difficult, but it also prevents researchers from studying the cancer cells, a necessary process in understanding the disease and advancing treatments. Dr. Berry had the idea to examine the aqueous humor, the fluid inside the eye itself.

"The last five years have been really exciting in retinoblastoma research," says Dr. Berry. "We use a tiny amount of fluid—100 microliters, about half the size of a green pea—and from that we get a trove of information, things that were impossible to see before. We can see genetic mutations, chromosomal aberrations. We can diagnose retinoblastoma at a molecular level." This provides oncologists with a very specific map of each child’s disease.

"There are a few specific factors that come up in these biopsies," she says, "markers that we suspect are bad players, leading to a more severe disease." Indeed, this is what Dr. Berry has confirmed in studies involving CHLA patient samples. "But we need to really ramp up this research so we can help kids everywhere," says Dr. Berry. "We need to look at a much larger data set." This summer, Dr. Berry’s team will do just that, leading an international research study.

The National Cancer Institute of the National Institutes of Health (NIH) has awarded Dr. Berry $2.8 million to lead the first prospective international retinoblastoma liquid biopsy study to date. The study will include samples from 18 centers, including the largest retinoblastoma center in Canada. All material will be processed and studied at Children’s Hospital Los Angeles, under the direction of Dr. Berry, who is the sole principal investigator named on the grant.

Children will be followed for a minimum of two years, so researchers can examine samples for possible cancer recurrence. Because tumors return in approximately 50% of retinoblastoma patients, this information can be lifesaving.

"We know that detecting a cancer as early as possible gives a child the best chance," says Dr. Berry. "In continuing to take biopsies from these children, we can treat any recurrences early on, even before they’re visible to a clinician upon examination."

The results of Dr. Berry’s forthcoming study will help shape the next phase of her research. "Right now, we’re in this position where we see very strong data," she says, "and we need to ensure that what we’re seeing is also represented in the international population." Then, says Dr. Berry, the team has plans to develop a clinical trial to evolve the standard of care for diagnosing and treating retinoblastoma—and link specific treatments to the information identified in the liquid biopsy.

On August 1, 2023 AVM Biotechnology, a clinical stage company actively enrolling Phase 2 for Relapsed/Refractory Non-Hodgkin’s Lymphoma of all subtypes (partially funded by NCI Ph II FastTrak grant 1R44CA272096), reported that twenty-eight (28) solid tumor and blood cancer patients have been treated with its immunomodulatory drug AVM0703 through Expanded Access (EAP)/Compassionate Use (CUP) programs (Press release, AVM Biotechnology, AUG 1, 2023, View Source [SID1234633614]). Cancers that have been treated include highly relapsed/refractory, some imminently terminal, patients with glioblastoma, metastatic breast cancer (two with advanced bone metastases), metastatic ovarian cancer, metastatic gastric cancer, Hodgkin’s Lymphoma, mixed phenotype acute leukemia, B-ALL, metastatic colon cancer, malignant myxoid spindle cell neoplasm, non-small cell lung cancer, DLBCL with CNS involvement, desmoplastic small round cell tumor, metastatic esophageal adenocarcinoma, prostate cancer, anaplastic T-cell Non-Hodgkin’s Lymphoma and inoperable/chemotherapy ineligible CNS squamous cell carcinoma.

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Immunomodulatory AVM0703’s relatively broad anti-cancer activity is hypothesized to be due to mobilization of a highly active gamma/delta T-cell receptor expressing immune cell, which is programmed to recognize special stress signals produced by most cancer cells but not normal cells. Requests for additional information about immunomodulatory AVM0703 and its relatively broad activity against solid tumors and blood cancers can be made by contacting [email protected].

"AVM Biotechnology is committed to providing AVM0703 to patients who cannot participate in our enrolling clinical trial. Based on absence of safety concerns and responses reported to date, we believe AVM0703 may provide benefits to all cancer patients who are desperately searching for options. Our team at AVM Biotechnology is dedicated to providing hope to patients and their loved ones." Theresa Deisher, AVM Biotechnology, Founder and CEO.

Requests for Expanded Access in the US must be made by a US licensed physician. Physicians can learn more about the AVM0703 EAP on clinicaltrials.gov and can request access by sending an email to [email protected].

About AVM0703:

AVM0703 is small molecule immunomodulatory drug enrolling Phase 2 trials in US in relapsed/refractory Non-Hodgkin’s Lymphoma (NHL) which began enrollment Q3 2023 (partially funded by NCI Ph II FastTrak grant 1R44CA272096). AVM0703 mobilizes a novel endogenous bispecific gamma delta TCR+ invariant TCR+ Natural Killer T-like cell with profound antitumor activity. AVM0703 has shown an absence of safety concerns with side-effects limited to grades 1-3. Clinical responses in the enrolling NHL trial and in FDA-approved expanded access/compassionate use include multiple NHL sub-types and diverse solid tumor types. Responses to AVM0703 are quite rapid, reported from 30 minutes to 14 days after infusion. Preclinical data also demonstrates a significant response against autoreactive lymphocytes in the NOD Type 1 diabetes model (Funded by NIDDK SBIR Ph I grant 1R43DK121634 and NIDDK SBIR Ph II grant 2R44DK121634). Gamma delta TCR+ lymphocytes recognize phosphoantigens expressed by stressed, cancer and infected cells and autoreactive lymphocytes, but not normal cells. Adoptive transfer of AVM0703 induced gamma delta TCR+ immune cells has potent activity against preclinical melanoma (funded by NCI SBIR Ph I grant 1R43CA246896). Additionally, AVM0703 has been shown to have potent neo-adjuvant activity before chemotherapy against immune-resistant, aggressive mouse A20 lymphoma (Funded by NCI SBIR Ph I 1R43_CA271951). Based on its ability to penetrate collagen-encased desmoplastic tumors, AVM0703 has promise as a neoadjuvant prior to chemoimmunotherapy to improve outcomes for metastatic advanced pancreatic cancer patients.