On August 9, 2023 Omeros Corporation (Nasdaq: OMER), a clinical-stage biopharmaceutical company committed to discovering, developing and commercializing small-molecule and protein therapeutics for large-market and orphan indications targeting immunologic disorders including complement-mediated diseases, cancers, and addictive and compulsive disorders, reported recent highlights and developments as well as financial results for the second quarter ended June 30, 2023, which include (Press release, Omeros, AUG 9, 2023, View Source [SID1234634085]):

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● Net loss was $37.3 million in the quarter ended June 30, 2023, or $0.59 per share, compared to a net loss in the prior year quarter of $30.8 million, or $0.49 per share. For the six months ended June 30, 2023 our net loss was $71.0 million, or $1.13 per share compared to $63.9 million, or $1.02 per share in the prior year period. Cash burn for the second quarter was $30.1 million.

● For the second quarter of 2023, we earned OMIDRIA royalties of $10.7 million on Rayner Surgical Inc.’s ("Rayner") U.S. net sales of $35.7 million. This compares to earned royalties of $17.2 million during the second quarter of the prior year on U.S. net sales of $34.5 million. The base royalty rate applicable to U.S. net sales of OMIDRIA decreased from 50 percent to 30 percent in December 2022 upon recognition of the $200.0 million milestone payment. The royalty rate applicable to any sales of OMIDRIA outside the U.S. remains unchanged at 15 percent.

● At June 30, 2023, we had $341.3 million of cash, cash equivalents and short-term investments available for operations and debt servicing along with $11.2 million of accounts receivable.

● In May 2023 we had a Type B meeting with the review division at FDA to discuss the planned resubmission of our Biologics License Application ("BLA") for narsoplimab in hematopoietic stem cell transplant-associated thrombotic microangiopathy ("TA-TMA"). Based on the agency’s feedback we expect to submit to FDA early next month a detailed plan for analysis of survival data from already-identified external sources.

● In June 2023, results from a pre-specified interim analysis of our ongoing clinical trial of OMS906 in treatment-naïve adults with paroxysmal nocturnal hemoglobinuria ("PNH") were presented at the 2023 congress of the European Hematology Association (EHA) (Free EHA Whitepaper). Statistically significant and clinically meaningful improvements were observed in all measured markers of hemolysis, including hemoglobin and lactate dehydrogenase. The OMS906 data were identified as one of the top five late-breaking submissions of the congress and were selected for presentation at a special oral session. At the end of July, we performed another analysis of the data in hand through the date of assessment. We continue to be highly encouraged by the results and plan to present the data from this most recent analysis at the upcoming congress of the American Society of Hematology (ASH) (Free ASH Whitepaper) in December.

● The Phase 2 "switch-over" trial evaluating OMS906 in patients demonstrating an unsatisfactory response to treatment with the C5 inhibitor ravulizumab is also underway. Seven of the targeted 12 patients have been enrolled with additional patients currently in screening.

"Our team continued building significant shareholder value throughout the second quarter of 2023," said Gregory A. Demopulos, M.D., Omeros’ chairman and chief executive officer. "Working with FDA, we continue to make progress toward a resubmission of our narsoplimab BLA for TA-TMA and are targeting a mid-2024 FDA decision regarding approval. As we prepare for a good outcome and subsequent market launch establishing narsoplimab as the first drug
approved for life-threatening TA-TMA, we remain on track to read out Phase 3 data later this quarter from our ARTEMIS-IGAN trial aimed at bringing narsoplimab to the large market opportunity of high-proteinuria IgA nephropathy. Our next-generation MASP-2 inhibitor, OMS1029, is in the clinic, looking well-set to be a once-quarterly subcutaneously or intravenously administered therapeutic, and is slated to begin a Phase 2 program next summer – and behind it, progressing toward the clinic, is our orally available small-molecule MASP-2 inhibitor. In the other half of our complement franchise, our Phase 2 clinical asset, OMS906, continues to deliver data consistent with a premier drug targeting the premier enzyme in the alternative pathway, increasing confidence in our objective to make OMS906 the first-line, standard-of-care for a wide range of alternative pathway disorders. At NIDA’s request and with its significant grant funding, we are advancing OMS527, our oral PDE7 inhibitor, to a Phase 2 clinical study as a treatment for cocaine use disorder and are considering assessing the drug in a Phase 2 trial for Parkinson’s-related levodopa-induced dyskinesia, a crippling unmet need affecting millions of patients. Our cellular and molecular immuno-oncology platforms also continue to mature, and we are working hard to add them to our pipeline of clinical assets. With a cash runway forecasted to fund operations well into 2025, we are strongly positioned to drive our development programs and monetize our assets. Our team’s mission is to bring transformational therapeutics to patients who need them – and that requires relentless execution against our development milestones and objectives. I’m proud of the way the Omeros team has executed in the first half of 2023, and I expect that we will continue that positive momentum into the back half of the year."

Second Quarter and Recent Clinical Developments

● Recent developments regarding narsoplimab, our lead monoclonal antibody targeting mannan-binding lectin-associated serine protease-2 ("MASP-2") in advanced clinical programs for the treatment of TA-TMA and IgA nephropathy, include:

o In May, we had a Type B meeting with FDA’s Division of Nonmalignant Hematology to discuss our planned resubmission of the BLA for narsoplimab in TA-TMA. At the meeting we received guidance from the Agency on our proposal to collect and analyze certain external survival data and to include these analyses in the BLA resubmission. Based on the Agency’s guidance, we expect to submit to FDA a detailed plan for analysis of those survival data, which are from already-identified external sources. The proposal will be submitted as a Type B meeting request, with FDA’s response expected within 60 days. After receiving FDA’s feedback on our detailed plan, we intend to conduct the analyses and, together with additional new supportive data, plan to resubmit the BLA. Assuming the full duration of relevant FDA review periods, we are targeting an approval decision by FDA in mid-2024. We expect next to provide investors with an update following BLA resubmission.

o In our Phase 3 ARTEMIS-IGAN trial evaluating narsoplimab for the treatment of IgA nephropathy, we remain on track to read out 9-month data on the proteinuria endpoint later this quarter.

o In late May, a review article authored by an international group of experts was published in Kidney International. The article describes kidney biopsies of IgA nephropathy patients, which consistently showed glomerular deposition of mannan-binding lectin together with IgA1 in up to 50% of patients with IgA nephropathy. Glomerular deposition of pattern-recognition molecules in the lectin pathway is associated with more severe glomerular damage and more severe proteinuria and hematuria. Research also suggests that lectin pathway activation contributes to tubulointerstitial fibrosis in IgA nephropathy and other proteinuric kidney disease.
● Our research efforts in COVID-19 and acute respiratory distress syndrome ("ARDS") continues at the Omeros-Cambridge Center for Complement and Inflammation Research ("OC3IR"). A manuscript detailing the beneficial effects of MASP-2 inhibition on both symptoms and survival in chemically induced ARDS was published at the end of May in Frontiers in Immunology. Another manuscript has been submitted for publication describing the pulmonary and central nervous systems benefits of MASP-2 blockade on symptoms and survival in well-established animal models of COVID-19 ARDS. Discussions are ongoing with the U.S. Government regarding development of narsoplimab for use in severe COVID-19 and other forms of ARDS.

● Recent developments regarding OMS1029, our long-acting, next-generation MASP-2 inhibitor, include:

o Dosing in a Phase 1 multiple-ascending-dose study of OMS1029 in healthy subjects was initiated on schedule in July. In a single-ascending dose Phase 1 clinical trial completed in early 2023, OMS1029 was well tolerated and no safety concerns were identified. Preliminary pharmacokinetic and pharmacodynamic ("PK/PD") data from that study showed dose-proportional exposure and sustained lectin pathway inhibition, consistent with once-quarterly intravenous or subcutaneous dosing. A Phase 2 program is slated to begin next summer.

● Recent developments regarding OMS906, our lead monoclonal antibody targeting mannan-binding lectin-associated serine protease-3 ("MASP-3"), the key activator of the alternative pathway, include:

o Enrollment is ongoing in our Phase 2 clinical trial evaluating OMS906 in PNH patients who have had an unsatisfactory response to the C5 inhibitor ravulizumab. The study has a "switch-over" design and enrolls PNH patients receiving ravulizumab, adds OMS906 to provide combination therapy with ravulizumab for 24 weeks, and then provides OMS906 monotherapy in patients who demonstrate a hemoglobin response with combination therapy. Enrollment is targeted for 12 patients, 7 of whom have already been enrolled with others in screening.

o Enrollment has been completed in the clinical trial treating patients who are not receiving complement inhibitors at entry (i.e., treatment-naïve). Data collection continues and an abstract detailing the most recent data analysis from late July has been submitted to the American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting to be held in December 2023.

o Our clinical program evaluating OMS906 in patients with complement 3 glomerulopathy ("C3G") is also underway. We are amending the dose in this trial based on data from our ongoing and completed clinical trials of OMS906 and expect soon to begin enrolling C3G patients.

o We recently engaged a group of expert hematologists for an advisory panel that yielded key insights on the current standard of care for the treatment of PNH, the unmet patient need and other factors affecting the market for PNH therapeutics. The session informed our clinical development plans and commercial strategy for OMS906 and, more generally, for our alternative pathway inhibitor program.

● Recent developments regarding OMS527, our phosphodiesterase 7 ("PDE7") inhibitor program focused on addiction and movement disorders, include:

o We continue to pursue development of our lead orally administered PDE7 inhibitor compound for the treatment of cocaine use disorder ("CUD"). This work was initiated at the request of, and is being performed in collaboration with, the National Institute on Drug Abuse ("NIDA"), part of the National Institutes of Health. The development efforts are supported by grant funding from NIDA. The three-year, $6.69 million grant is intended to support a preclinical cocaine interaction study and a randomized, placebo-controlled, inpatient clinical study evaluating the safety and effectiveness of OMS527 in patients with CUD. Previously, a Phase 1 clinical trial of the study drug in healthy subjects was successfully completed.
o Along with collaborators at Emory University we continue to evaluate the potential of our PDE7 inhibitors to treat levodopa-induced dyskinesias ("LID"). LID is caused by prolonged treatment with levodopa, the most prescribed treatment for the over 10 million patients with Parkinson’s disease worldwide. LID is reported to affect 50 percent or more of levodopa-treated patients with Parkinson’s disease. We are evaluating the data and will file patent applications as appropriate.
Financial Results

Net loss for the quarter ended June 30, 2023 was $37.3 million, or $0.59 per share. This compares to a net loss in the prior year quarter of $30.8 million, or $0.49 per share. Cash burn for the quarter ended June 30, 2023 was $30.1 million, an amount artificially inflated by $3.4 million corresponding to Rayner’s late payment of royalties received in July but due in June 2023.

For the second quarter of 2023, we earned OMIDRIA royalties of $10.7 million on Rayner’s U.S. net sales of $35.7 million. This compares to earned royalties of $17.2 million during the second quarter of the prior year on U.S. net sales of $34.5 million. The recognition of the $200 million milestone payment from Rayner in December 2022 triggered a reduction of our U.S. base royalty rate from 50 percent to 30 percent. Royalties are recorded as a reduction of the OMIDRIA contract royalty asset on our balance sheet.

Total costs and expenses for the second quarter of 2023 were $40.9 million compared to $37.4 million for the second quarter of 2022. The increase was primarily due to the advancement of our OMS906 program and incremental clinical trial costs for narsoplimab. This increase was partially offset by reductions in selling, general and administrative expenses.

Interest expense during the second quarter of 2023 was $7.9 million compared to $4.9 million during the prior year quarter. The increase was due to interest on our OMIDRIA contract royalty obligation associated with the sale of a portion of our OMIDRIA royalty receivables, which we entered into during the third quarter of 2022.

During the second quarter of 2023, we earned $4.5 million in interest and other income compared to $0.7 million in the prior year quarter. The increase was due to higher average balances available to invest and higher market interest rates in the current year quarter.

Net income from discontinued operations, net of tax, was $7.0 million, or $0.11 per share, in the second quarter of 2023 compared to $10.8 million, or $0.17 per share, in the second quarter of 2022.

As of June 30, 2023, we had $341.3 million of cash and short-term investments, all of which are held in our name, available for operations and debt service. In addition, we had $11.2 million in accounts receivable.

Conference Call Details

Omeros’ management will host a conference call and webcast to discuss the financial results and to provide an update on business activities. The call will be held today at 5:30 a.m. Pacific Time; 8:30 a.m. Eastern Time.

For online access to the live webcast of the conference call, go to Omeros’ website at View Source

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A replay of the call will be made accessible online at View Source

On August 9, 2023 Nuvectis Pharma, Inc. (NASDAQ: NVCT) ("Nuvectis" or the "Company"), a clinical-stage biopharmaceutical company focused on the development of innovative precision medicines for the treatment of serious conditions of unmet medical need in oncology, reported its financial results for the second quarter 2023 and provided an update on recent pipeline progress (Press release, Nuvectis Pharma, AUG 9, 2023, View Source [SID1234634083]).

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Ron Bentsur, Chairman and Chief Executive Officer of Nuvectis, commented, "During the second quarter, we made significant progress on our NXP800 and NXP900 development programs. For NXP800, we initiated our single-arm, open-label, Phase 1b clinical trial in patients with platinum resistant, ARID1a-mutated ovarian carcinoma and the study is ongoing. We expect to have a preliminary data update from the Phase 1b in the first quarter of 2024." Mr. Bentsur continued, "Moreover, data generated in several preclinical cancer models support the expansion of the NXP800 clinical program into additional potential target indications, such as cholangiocarcinoma."

With respect to the NXP900 program, Mr. Bentsur added, "For NXP900, the Investigational New Drug ("IND") application was cleared by the US Food and Drug Administration ("FDA"), and we expect to initiate the Phase 1a dose escalation study this quarter." Mr. Bentsur concluded, "Finally, we have significantly strengthened our financial position, ending the quarter with approximately $24.6 million in cash. We expect this will enable us to support planned operations into H1 2025."

Second Quarter 2023 Financial Results

Cash, cash equivalents, and short-term investments were $24.6 million as of June 30, 2023, compared to $20.0 million as of December 31, 2022. The increase of $4.6 million was primarily a result of the exercise of warrants from the July 2022 private investment in public equity ("PIPE") transaction.

Research and Development (R&D) expenses were $4.3 million for the three months ended June 30, 2023, compared to $2.5 million for the three months ended June 30, 2022. The increase of $1.8 million in R&D expenses was primarily attributed to non-cash expenses related to stock-based compensation and manufacturing costs. R&D expenses for the three months ended June 30, 2023 included $0.6 million in non-cash expenses related to stock-based compensation and $0.9 million in one-time research support and milestone payments in connection with the NXP800 and NXP900 license agreements.

General and Administrative (G&A) expenses were $1.5 million for the three months ended June 30, 2023, compared to $1.1 million for the three months ended June 30, 2022, an increase of $0.4 million. G&A expenses for the three months ended June 30, 2023 included $0.4 million in non-cash expenses related to stock-based compensation.

The Company’s net loss was $5.7 million for the three months ended June 30, 2023, compared to $3.6 million for the three months ended June 30, 2022, an increase of $2.1 million. The net loss for the three months ended June 30, 2023 included $1.0 million in non-cash expenses related to stock-based compensation and $0.9 million in one-time payments in connection with the NXP800 and NXP900 license agreements.

On August 9, 2023 MacroGenics, Inc. (NASDAQ: MGNX), a biopharmaceutical company focused on developing and commercializing innovative antibody-based therapeutics for the treatment of cancer, reported an update on its recent corporate progress and announced financial results for the quarter ended June 30, 2023 (Press release, MacroGenics, AUG 9, 2023, View Source [SID1234634082]).

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"MacroGenics maintains its historical focus on developing innovative antibody-based therapeutics, and we are very excited about our continued progress in advancing our two Phase 2 programs in prostate cancer, which engage different yet potentially complementary mechanisms of action," said Scott Koenig, M.D., Ph.D., President and CEO of MacroGenics. "Additionally, we’ve expanded our efforts to broaden our antibody-drug conjugate (ADC) portfolio through technology-enabling partnerships, internal discovery efforts on first-in-class targets, as well as our continued antibody engineering expertise. As we’ve indicated earlier, we intend to submit an investigational new drug (IND) application to the FDA by year-end for the first of potentially multiple new ADC molecules which incorporate a topoisomerase inhibitor payload."

Updates on Proprietary Investigational Programs

Recent progress and anticipated events related to MacroGenics’ investigational product candidates are highlighted below.

Vobramitamab duocarmazine (vobra duo) is an ADC that targets B7-H3, an antigen with broad expression across multiple solid tumors and a member of the B7 family of molecules involved in immune regulation.
MacroGenics began enrolling the TAMARACK Phase 2 study of vobra duo in patients with mCRPC under an amended protocol during the second quarter. This study is designed to evaluate vobra duo at two different doses, 2.0 mg/kg or 2.7 mg/kg every four weeks, across a total of 100 patients. MacroGenics anticipates enrolling a majority of the study patients in 2023 and expects to provide a clinical update in 2024.
MacroGenics continues to enroll a Phase 1/2 dose escalation study of vobra duo in combination with lorigerlimab in patients with various advanced solid tumors. The Company anticipates commencing the dose expansion portion of the study by year-end 2023.
Lorigerlimab is a bispecific, tetravalent PD-1 × CTLA-4 DART molecule. Based on the encouraging lorigerlimab monotherapy clinical data in mCRPC previously presented at ASCO (Free ASCO Whitepaper) Genitourinary Cancers Symposium in February 2023, MacroGenics plans to commence enrollment of a randomized Phase 2 study of lorigerlimab in combination with docetaxel vs. docetaxel alone in second-line, chemotherapy-naïve mCRPC patients in the coming weeks. A total of 150 patients are planned to be treated in the 2:1 randomized study. The current trial design includes a primary study endpoint of radiographic progression-free survival (rPFS).
MGD024 is a next-generation, humanized CD123 × CD3 DART molecule designed to minimize cytokine-release syndrome, while maintaining anti-tumor cytolytic activity, and permitting intermittent dosing through a longer half-life. MacroGenics continues to enroll patients in a Phase 1 dose-escalation study of MGD024 in patients with CD123-positive neoplasms, including acute myeloid leukemia and myelodysplastic syndromes.
Enoblituzumab is an Fc-optimized monoclonal antibody that targets B7-H3. Based on the recently published results from a Phase 2 investigator-sponsored study of enoblituzumab in men with prostate cancer, MacroGenics and collaborators at multiple academic institutions plan to initiate an investigator-sponsored randomized, translationally intense, neo-adjuvant prostate cancer study in a high-risk population by early 2024.
Other Corporate Updates

$50 million TZIELD milestone. On July 28, 2023, Sanofi S.A. (Sanofi) reported that the PROTECT placebo-controlled study investigating TZIELD in patients with newly diagnosed stage 3 Type 1 diabetes met its primary endpoint, having demonstrated preservation of beta cell function. This positive study outcome triggers payment of a $50 million milestone to MacroGenics by Sanofi, pursuant to a March 2023 agreement originally between MacroGenics and DRI Healthcare Acquisitions LP (DRI), the royalty interest and milestone payment obligations of which were sold by DRI to a subsidiary of Sanofi in April 2023.

Under the MacroGenics agreement with DRI, since assumed by a Sanofi subsidiary, MacroGenics retains the right to receive a 50% share of the royalty on global net sales of TZIELD above a certain annual threshold. Under this agreement, the Company may also receive an additional $50 million milestone from Sanofi if TZIELD achieves a certain level of net sales. In addition, MacroGenics continues to be eligible to receive additional economics under the asset purchase agreement with Provention Bio, Inc.
Second Quarter 2023 Financial Results

Cash Position: Cash, cash equivalents and marketable securities as of June 30, 2023, were $240.3 million, compared to $154.3 million as of December 31, 2022. The Company’s cash balance as of June 30, 2023 did not include the $50 million milestone from Sanofi subsequently earned.
Revenue: Total revenue was $13.1 million for the quarter ended June 30, 2023, compared to total revenue of $26.0 million for the quarter ended June 30, 2022.
R&D Expenses: Research and development expenses were $43.2 million for the quarter ended June 30, 2023, compared to $51.7 million for the quarter ended June 30, 2022. The decrease was primarily related to decreased costs related to discontinued studies, partially offset by increased expenses related to preclinical ADC molecules and increased clinical expenses related to lorigerlimab and vobra duo.
SG&A Expenses: Selling, general and administrative expenses were $13.7 million for each of the quarters ended June 30, 2023 and June 30, 2022.
Other Income: Under GAAP guidelines and pursuant to Financial Accounting Standards Board’s Accounting Standards Codification (ASC) 470, in March 2023, MacroGenics recorded the $100 million proceeds received from the sale of the Company’s single-digit royalty interest on global net sales of TZIELD to DRI as a "Liability related to future royalties." This liability was to be amortized over the term of the arrangement using the effective interest rate method. In separate transactions, Sanofi subsequently acquired both Provention Bio, Inc. and the TZIELD royalty interest and milestone obligations from DRI on April 27, 2023, obviating the need for MacroGenics’ involvement in the transfer of royalty payments to DRI. This resulted in a change to the arrangement, which was evaluated as a modification under the provisions of ASC 470. Accordingly, the Company recognized approximately $100 million as a component of other income on its financial statements for the quarter ended June 30, 2023.
Net Income (Loss): Net income was $57.5 million for the quarter ended June 30, 2023, compared to net loss of $41.3 million for the quarter ended June 30, 2022.
Shares Outstanding: Shares of common stock outstanding as of June 30, 2023 were 61,938,493.
Cash Runway Guidance: MacroGenics anticipates that its cash, cash equivalents and marketable securities balance of $240.3 million as of June 30, 2023, plus the $50 million milestone subsequently earned, in addition to projected and anticipated future payments from partners and product revenues should extend its cash runway into 2026. The Company’s expected funding requirements reflect anticipated expenditures related to the Phase 2 TAMARACK clinical trial, the Phase 2 study of lorigerlimab in mCRPC as well as MacroGenics’ other ongoing clinical and preclinical studies.
Conference Call Information

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The listen-only webcast of the conference call can be accessed under "Events & Presentations" in the Investor Relations section of MacroGenics’ website at View Source A recorded replay of the webcast will be available shortly after the conclusion of the call and archived on MacroGenics’ website for 30 days following the call.

On August 9, 2023 Lantern Pharma Inc. (NASDAQ: LTRN), an artificial intelligence ("AI") company developing targeted and transformative cancer therapies using its proprietary RADR AI and machine learning ("ML") platform with multiple clinical-stage drug programs, reported operational highlights and financial results for the second quarter ended June 30, 2023 (Press release, Lantern Pharma, AUG 9, 2023, View Source [SID1234634081]).

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"We made significant strides over the past quarter in executing our mission of transforming the oncology drug discovery and development process, especially with advancing our programs for LP-184 and LP-284 into the clinical setting and increasing our focus on developing next-generation ADCs. Our RADR AI platform is revolutionizing the way we understand and predict drug-cancer interactions, enabling us to advance our newly developed drug programs from initial AI insights to first-in-human clinical trials in an average of two years and at a cost of roughly $1-2 million per program – a milestone unheard of in the realm of oncology drug discovery," said Panna Sharma, CEO of Lantern Pharma.

Sharma continued, "Computational and AI-driven approaches are increasing their presence and usage at both large and emerging pharma companies for all facets of drug discovery and development. Our leadership in the innovative use of AI and machine learning to transform costs and timelines in the development of precision oncology therapies should yield significant returns for investors and patients as our industry matures and adopts an AI-centric approach to drug development. Our top-ranked AI algorithms can predict any compound’s blood-brain barrier permeability with 89-92% accuracy, a major breakthrough that could accelerate the timeline for developing treatments for brain and CNS cancers and also for other neurological disorders. We also presented breakthrough RADR advancements at the AACR (Free AACR Whitepaper) and ASCO (Free ASCO Whitepaper) annual meetings this quarter, demonstrating an 88% accuracy in predicting patient responses for our biopharma collaborator with a unique drug candidate."

"Our unwavering commitment to harnessing the power of AI for drug discovery has also led to the formation of a collaboration with Bielefeld University to develop the next-generation of ADCs that are designed and advanced using AI. This collaboration has the potential to pave the way for higher efficacy, faster development, and significantly reduced costs in this rapidly growing and emerging treatment modality. These specific instances of value creation along with the development of an entirely new company, Starlight Therapeutics, whose sole focus will be on CNS and brain cancers, demonstrate that Lantern continues to be at the forefront of a transformative approach to oncology drug discovery, and we look forward to sharing more breakthroughs and advancements as we move forward," Sharma concluded.

Highlights of AI-Powered Pipeline:

● LP-184 – Received Food and Drug Administration (FDA) clearance of the investigational new drug (IND) application for LP-184 during the second quarter of 2023. LP-184 is the first of Lantern’s drug candidates to be developed entirely internally, with the assistance of Lantern’s AI and ML platform RADR, to advance to a first-in-human Phase 1 basket trial. Lantern has rapidly accelerated the clinical advancement of LP-184 and has activated the first two Phase 1 clinical trial sites and begun screening patients. Indications for the trial are anticipated to include relapsed/refractory advanced pancreatic cancer, glioblastoma (GBM), brain metastases (brain mets.), and multiple other solid tumor types with DNA damage response deficiencies.

The dosage and safety data obtained in the Phase 1 trial will be used to advance the central nervous system (CNS) indications for a future Phase 2 trial to be sponsored by Lantern’s wholly-owned subsidiary, Starlight Therapeutics. Globally, the aggregate annual market potential of LP-184’s target indications is estimated to be approximately $10+ billion, consisting of $5+ billion for CNS cancers and $6+ billion for solid tumors.

● LP-284 – IND-enabling studies for LP-284 have been completed, and Lantern expects to submit the IND application to the FDA in August. The first-in-human Phase 1 clinical trial launch of LP-284 is targeted for Q4 of 2023 for B-cell non-Hodgkin’s lymphomas (NHL), where LP-284 has shown nanomolar potency across multiple in vitro and in vivo studies, including mantle cell lymphoma (MCL), double hit lymphoma (DHL), and other advanced NHL cancer subtypes with DNA damage response deficiencies, notably those with reduced expression of the ataxia-telangiectasia mutated (ATM) gene due to mutations or deletions.

Nearly all MCL patients relapse from the current MCL standard-of-care agents and there is an urgent and unmet need for novel improved therapeutic options for these patients. In the US and Europe, MCL and DHL are diagnosed in approximately 9,000 patients each year and have an estimated annual market potential of $1.2 billion.

● LP-300 – Dosed initial patients in the Phase 2 Harmonic trial, which is assessing the effect of LP-300 in combination with standard-of-care chemotherapy in never-smoker patients with relapsed non-small cell lung cancer (NSCLC). In addition to the dosed patients, more than two dozen potential patients have been pre-screened and are being monitored for possible enrollment across the multiple trial sites in the US. The Company is accelerating efforts to bolster recruitment, including activating multiple additional strategic sites across the US, potentially expanding the trial to countries in Asia that are known to have a significantly higher prevalence of never-smokers with NSCLC, and adding key experienced personnel to the clinical development and operations team.

Dr. Joseph Treat MD of Fox Chase Cancer Center has been appointed lead principal investigator of the Harmonic study. Dr. Treat is a leading expert in lung malignancies, including NSCLC in never smokers, and has dedicated his career, since 1991, to serving patients with lung cancer.

Globally, never-smokers with NSCLC are a growing population of patients and do not respond well to PD-1/PD-L1 based therapies, leaving them with reduced treatment options. In the US, there are approximately 20,000-40,000 never-smokers with NSCLC diagnosed annually, representing an estimated US annual market potential of $1.5 billion and a global estimated annual market potential of over $2.5 billion. Additional information on the Harmonic trial can be found at the Harmonic website and clinicaltrials.gov.

RADR Platform Growth and Development:

● RADR continues to advance in size, scope, and capabilities to accelerate the Company’s pipeline of precision therapeutics and also become a standard for AI-driven drug development in oncology. RADR has now surpassed 34 billion oncology-focused datapoints and is projected to reach 50 billion datapoints by the end of 2023. The scope of RADR’s data has broadened with a strategic focus on additional classes of compounds including antibodies, checkpoint inhibitors, and DNA damaging agents, and data from additional studies such as those being conducted clinically as a liquid biopsy for cancer diagnosis and treatment or those from preclinical combination studies that aim to define drug interaction and optimal dosage.

These datapoints and the associated advancements in automation have advanced RADR’s drug development capabilities including 1) predicting patient responses and identifying optimal combination regimens for immuno-oncology (IO) drugs such as immune checkpoint inhibitors, 2) predicting the BBB permeability, with 89% to 92% accuracy, of any compound at a scale and speed that allows the analysis of tens of thousands of compounds a day, and 3) accelerating the design and development of drug-conjugate templates for next-generation antibody-drug conjugates (ADCs) that have increased potential for improved safety and efficacy. These 3 modules exemplify the type of rapid and grounded progress the RADR platform will make over the next several quarters as it aims to improve the speed and reduce the costs and risks associated with creating cancer therapies.

● Lantern initiated a new collaboration with Bielefeld University to develop breakthrough ADCs. The collaboration with Bielefeld University’s Professor Norbert Sewald, Ph.D., a leading researcher in the field and head of the Magicbullet::reloaded consortium, is focusing on the synthesis and evaluation of novel ADCs linked to cryptophycins, a promising group of potent antitumor molecules. The global ADC market, currently valued at over $4 billion, is projected to reach $14 billion by 2027 and Lantern is positioned to be at the forefront of this rapidly growing sector.

Starlight Therapeutics:

● In Q1 2023, Lantern formed a wholly-owned subsidiary, Starlight Therapeutics Inc. ("Starlight"), for the clinical development of drug candidate LP-184’s central nervous system (CNS) and brain cancer indications – including GBM, brain mets., and several rare pediatric CNS cancers. Starlight will refer to the molecule LP-184, as it is developed in CNS indications, as "STAR-001".

● The company has begun discussions with leading clinicians and key opinion leaders at CNS-focused cancer centers to serve as clinical trial sites for upcoming clinical trials in adult and pediatric CNS cancers. Additionally, the formation of Starlight’s Scientific/Clinical Advisory Board is advancing and will be announced in Q3. The Advisory Board members are anticipated to help sharpen the aims and heighten the awareness of upcoming Starlight clinical trials.

Additional Operational Highlights:

● New findings published in Oncotarget demonstrated that drug candidate LP-284 has in vitro and in vivo antitumor potency in over 15 NHL models, including MCL and DHL. The journal article titled "LP-284 Targets Non-Hodgkin’s Lymphoma and DNA Damage Repair Deficiency" includes fundamental LP-284 findings demonstrating 1) LP-284 inhibited tumor growth in mice implanted with MCL xenografts at a level greater than current MCL standard of care (SOC) agents ibrutinib and bortezomib and 2) in MCL xenografts that had grown resistant to these SOC agents, subsequent LP-284 treatment led to near complete tumor regression.

● Lantern Pharma received a notice of allowance from the United States Patent and Trademark Office (USPTO) for the composition of matter patent, no. 17/192,838, covering the molecule LP-284, including claims covering the new molecular entity. Lantern Pharma expects the resulting LP-284 patent will be Orange Book-listable with an anticipated expiration of early 2039.

Additionally during the quarter, five new patent applications were filed for LP-184 and LP-284, with claims covering the use of these drug candidates in combination regimens for specific tumor subtypes.

● New data and findings to be presented at several upcoming scientific conferences:

● Society of Neuro-Oncology/American Society of Clinical Oncology CNS Cancer Conference in San Francisco, CA, on August 10th, 2023 from 5:30-7:30 p.m. PT. Link to conference registration here.
Presentation Title: LP-184, a novel acylfulvene-derived tumor site activated small molecule inhibits adult and pediatric CNS tumor cell growth

● International Conference on Drug Conjugates for Directed Therapy in Darmstadt, Germany on Thursday, August 24th, 2023 from 9:45-10:15 a.m. CEST. Link to conference registration here.
Presentation Title: In-silico Approach for the Identification of ADC Targets with Improved Tumor Selectivity

● Society of Hematologic Oncology Annual Meeting in Houston, TX on Wednesday, September 6th, 2023 at 6:00 p.m. CT. Link to conference registration here.
Presentation Title: Targeting Homologous Recombination Deficiencies in B-Cell Non-Hodgkin’s Lymphomas with the Novel Anti-Tumor Small Molecule LP-284

Second Quarter 2023 Financial Overview:

● Balance Sheet: Cash, cash equivalents, and marketable securities were approximately $48.0 million as of June 30, 2023, compared to approximately $55.2 million as of December 31, 2022. The quarterly cash burn rate continues to reflect our capital-efficient, collaborator-centered business model.

● R&D Expenses: Research and development expenses were approximately $3.6 million for the quarter ended June 30, 2023, compared to approximately $3.0 million for the quarter ended June 30, 2022.

● G&A Expenses: General and administrative expenses were approximately $1.6 million for the quarter ended June 30, 2023, compared to approximately $1.4 million for the quarter ended June 30, 2022.

● Net Loss: Net loss was approximately $4.7 million (or $0.44 per share) for the quarter ended June 30, 2023, compared to a net loss of approximately $4.5 million (or $0.41 per share) for the quarter ended June 30, 2022.

Earnings Call and Webinar Details:

Lantern will host its second quarter 2023 earnings call and webinar today, Wednesday, August 9, 2023, at 4:30 p.m. ET.

● View Source
● Related presentation materials will be accessible at: View Source
● A replay of the second quarter earnings call and webinar will be available at View Source

On August 9, 2023 Jazz Pharmaceuticals plc (Nasdaq: JAZZ) reported financial results for the second quarter of 2023, raised 2023 full year financial guidance and provided business updates (Press release, Jazz Pharmaceuticals, AUG 9, 2023, View Source [SID1234634080]).

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"Our focused execution delivered strong momentum across all three key growth drivers of our commercial business, with significant demand for Xywav, Epidiolex and Rylaze. We remain confident that our oxybate franchise will reach $2 billion in 2025, underpinned by the durability and growth of low-sodium Xywav. We’ve achieved another quarter of double-digit, year-over-year growth of Epidiolex, as we unleash its blockbuster potential through in-person engagement, compelling data and ongoing educational efforts. We have achieved impressive diversification with 66% of total revenues stemming from Xywav, Epidiolex and Rylaze, and we expect our Oncology therapeutic area to reach approximately $1 billion in annual revenue this year," said Bruce Cozadd, chairman and chief executive officer of Jazz Pharmaceuticals. "Our disciplined capital allocation strategy includes investing in our commercial brands to drive top-line growth, investing in our pipeline to drive long-term growth and corporate development, where we remain actively engaged in assessing opportunities and which we continue to believe is an important pillar of growth. Supported by our strong cash flow, we have resumed share repurchases under our existing program. In the second quarter, we completed approximately $100 million of share repurchases of the total $431 million authorized under the program as of March 31, 2023. Our strong operational and financial foundation enables additional investment in growth drivers, and we are well-positioned to execute corporate development and innovate new medicines for patients."

"Since bringing zanidatamab into our pipeline, it has continued to impress, as exemplified by the positive pivotal Phase 2b biliary tract cancers (BTC) data being selected for the 2023 Best of ASCO (Free ASCO Whitepaper) program and published in The Lancet Oncology. We are planning for a potential accelerated approval of zanidatamab in second-line (2L) BTC, and have alignment with FDA on a confirmatory trial in first-line (1L) metastatic BTC. We believe zanidatamab has the potential to address a very large unmet need and raise the standard of care for some of the most difficult-to-treat HER2-expressing cancers. We look forward to the top-line data readout from the zanidatamab Phase 3 gastroesophageal adenocarcinoma (GEA) trial expected in 2024," said Rob Iannone, M.D., M.S.C.E., executive vice president, global head of research and development of Jazz Pharmaceuticals. "We are on track for multiple near-term pipeline catalysts, including top-line data from a Phase 2 trial of JZP150 in post-traumatic stress disorder (PTSD) and initial proof of concept of JZP441 in healthy volunteers later this year. In the first half of 2024, we expect to have top-line data from a Phase 2b trial of suvecaltamide in essential tremor (ET), as well as top-line progression-free survival (PFS) data from the Zepzelca 1L combination trial in extensive-stage (ES) small cell lung cancer (SCLC) as early as the end of 2024. As we advance these promising programs, we remain focused on providing the greatest possible impact for patients and their families."

1

Key Highlights

•Achieved significant diversification, with nearly 50% of net product sales from Oncology and Epidiolex and more than 50% of oxybate revenues driven by Xywav.
•Xywav continues to be the oxybate of choice and only FDA-approved treatment for idiopathic hypersomnia (IH), achieving blockbuster status and annualizing at well over $1 billion.
•Epidiolex/Epidyolex global launch continues to gain momentum further positioning it to achieve blockbuster status.
•Rylaze demand grew for the fourth consecutive quarter with a 39% increase in net product sales to $102 million in 2Q23 compared to 2Q22.
•Raised full year 2023 financial guidance:
◦Raised total and Neuroscience revenue guidance at the mid-points.
◦Raised GAAP earnings per diluted share (EPS) to $6.60-$8.15.
◦Raised non-GAAP adjusted EPS by $1.20 at the mid-point to $18.15-$19.00.
•Zanidatamab Phase 2b HERIZON-BTC-01 results were featured as an oral presentation at ASCO (Free ASCO Whitepaper) 2023 and concurrently published in The Lancet Oncology.

Business Updates

Key Commercial Products
Xywav (calcium, magnesium, potassium, and sodium oxybates) oral solution:
•Xywav net product sales increased 39% to $326.6 million in 2Q23 compared to the same period in 2022.
•There were approximately 11,500 active Xywav patients exiting 2Q23.
•The Company presented robust data sets at two medical meetings in 2Q23, emphasizing leadership in neuroscience and commitment to advancing the understanding of sleep disorders.
◦Six presentations at American Academy of Neurology Annual Meeting, including a study that explored the increased risk of hypertension onset among patients with narcolepsy newly treated with Xyrem. The study detected increased risk of new-onset hypertension, within 180 days, among normotensive patients with narcolepsy initiating treatment with high-sodium oxybate, even among patients without a history of cardiovascular disease.
◦Seven presentations at SLEEP 2023, including real-world TENOR study of adults with narcolepsy that demonstrated most patients preferred Xywav over Xyrem due to its lower sodium content.

Xywav for Narcolepsy:
•There were approximately 9,300 narcolepsy patients taking Xywav exiting 2Q23.
•The benefits of reducing sodium intake continue to resonate with patients and prescribers.
•FDA continues to recognize seven years of Orphan Drug Exclusivity (ODE), through July 2027, for Xywav in narcolepsy. FDA published its summary of clinical superiority findings stating that "Xywav is clinically superior to Xyrem by means of greater safety because Xywav provides a greatly reduced chronic sodium burden compared to Xyrem." Further, FDA stated that "the differences in the sodium content of the two products at the recommended doses will be clinically meaningful in reducing cardiovascular morbidity in a substantial proportion of patients for whom the drug is indicated." For clarity, the authorized generics (AGs) of Xyrem contain the exact same drug product as branded Xyrem.
•FDA has also recognized that the difference in sodium content between Xywav and Lumryz is likely to be clinically meaningful in all patients with narcolepsy and that Xywav is safer than high-sodium oxybate products, including Lumryz, in all such patients. Lumryz is a branded, fixed-dose, high-sodium oxybate that has the same sodium content as Xyrem.
•Xywav is the only approved oxybate therapy that does not carry a warning and precaution related to high sodium intake.

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Xywav for Idiopathic Hypersomnia (IH):
•There were approximately 2,200 IH patients taking Xywav exiting 2Q23.
•Jazz survey of sleep specialists indicates 70% anticipate increasing their prescribing of Xywav for IH over the next six months, and new prescribers continued to grow in 2Q23.
•Xywav is the first and only treatment approved by FDA to treat the full condition of IH.
•FDA recognized ODE for IH extending regulatory exclusivity to August 2028.

Xyrem (sodium oxybate) oral solution:
•Xyrem net product sales decreased 41% to $159.8 million in 2Q23 compared to the same period in 2022, reflecting the continued adoption of Xywav by patients with narcolepsy and the launch of a high-sodium oxybate AG in January 2023.
•Royalties from high-sodium oxybate AG were $5.5 million in 2Q23. Due to the royalty structures within the AG agreements, we expect the royalties from AGs to be significantly higher in the second half of 2023 relative to the first half.

Oxybate (Xywav and Xyrem):
•Total revenues for the combined oxybate business, including royalties from a high-sodium oxybate AG in 2Q23, decreased 2% to $491.8 million in 2Q23 compared to the same period in 2022.
•Average active Jazz oxybate patients on therapy was approximately 16,200 in 2Q23, a decrease of 5% compared to the same period in 2022.

Epidiolex/Epidyolex (cannabidiol):
•Epidiolex/Epidyolex net product sales increased 15% to $202.2 million in 2Q23 compared to the same period in 2022.
•A pivotal Phase 3 trial of Epidyolex for Dravet syndrome, Lennox-Gastaut syndrome and tuberous sclerosis complex in Japan is enrolling patients.
•Epidiolex/Epidyolex global prescriber base increasing with multiple launches expected outside of the U.S. this year.
•Increased penetration in long-term care setting driven by additional in-person engagement with physicians.
•Additional Epidiolex growth opportunities underscored by BECOME survey’s caregiver reported outcomes beyond seizure control, which further differentiates Epidiolex from other anti-seizure medicines, and compelling data for use of Epidiolex in combination with clobazam.
•Epidyolex global launch continues to gain momentum further positioning Epidiolex/Epidyolex to achieve blockbuster status.

Rylaze (asparaginase erwinia chrysanthemi (recombinant)-rywn):
•Rylaze net product sales increased for the fourth consecutive quarter; 2Q23 net product sales increased 39% to $101.7 million compared to the same period in 2022.
•Continued strong demand for Rylaze reflects the significant unmet patient need for a high-quality, reliable supply of Erwinia asparaginase for patients with acute lymphoblastic leukemia.
•The Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) has granted a positive opinion for JZP458 (marketed as Rylaze in the U.S.), recommending the marketing authorization to the European Commission (EC). The Company anticipates EC approval later this year.

Zepzelca (lurbinectedin):
•Zepzelca net product sales increased 3% to $70.3 million in 2Q23 compared to the same period in 2022.
•Zepzelca is the treatment of choice in 2L SCLC setting, with potential to expand into 1L ES SCLC.
•Zepzelca development program highlights:
3

◦Phase 3 trial in partnership with F. Hoffmann-La Roche Ltd (Roche) to evaluate 1L use of Zepzelca in combination with Tecentriq (atezolizumab), compared to Tecentriq alone, as maintenance therapy in patients with ES SCLC after induction chemotherapy is ongoing. The Company expects top-line data to readout at the end of 2024 or early 2025.
◦The Company’s partner, PharmaMar, is conducting the Phase 3 confirmatory trial, LAGOON, in 2L SCLC. If positive, this trial could confirm the benefit of Zepzelca in the treatment of SCLC when patients progress following 1L treatment with a platinum-based regimen.
◦The Company has elected to close the EMERGE-201 Phase 2 basket trial evaluating Zepzelca as monotherapy in select relapsed/refractory solid tumors based on limited response in three solid tumor cohorts. The Company is analyzing findings from that trial and continuing to explore additional tumor types that may benefit from treatment with Zepzelca.

Key Pipeline Highlights
Zanidatamab:
•Zanidatamab is a bispecific antibody with a unique design that results in multiple mechanisms of action and potent effector function leading to encouraging antitumor activity in patients.
•The Company believes zanidatamab has the potential to address a very large unmet need in HER2-positive cancers, with initial focus in BTC and GEA and potential to transform the current standard of care in multiple HER2-positive cancers.
•Positive top-line data from the pivotal HERIZON-BTC-01 clinical trial has the potential to support regulatory submissions for zanidatamab as a monotherapy in patients with previously treated HER2-amplifed and expressing BTC.
•The Company is planning for a potential accelerated approval of zanidatamab in 2L BTC, and has alignment with FDA on a confirmatory trial in 1L metastatic BTC, where there remains unmet patient need.
•Data from the HERIZON-BTC-01 clinical trial were featured as an oral presentation at the 2023 ASCO (Free ASCO Whitepaper) Annual Meeting and concurrently published in The Lancet Oncology. Results demonstrated meaningful clinical benefit including antitumor activity, confirmed objective response rate (cORR) of 41.3%, median duration of response (DOR) of 12.9 months, and median PFS of 5.5 months (median study follow-up time of 12.4 months).
•The pivotal trial, HERIZON-GEA-01, evaluating zanidatamab in 1L GEA is ongoing and top-line data are expected in 2024.

JZP150:
•JZP150, a selective fatty acid amide hydrolase, or FAAH, inhibitor, is in clinical development for the potential treatment of PTSD.
•Patient enrollment is ongoing in a Phase 2 trial and top-line data readout is anticipated in late 2023.
•The primary endpoint of the Phase 2 trial is clinician-administered PTSD Scale (CAPS-5) total symptom severity score change from baseline to week 12 to establish proof of concept of JZP150 in patients diagnosed with Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition (DSM-5) PTSD.
•The Company received Fast Track Designation for JZP150 development in PTSD from FDA, underscoring the significant unmet medical needs of patients.

Suvecaltamide (JZP385):
•Suvecaltamide, a highly selective and state dependent modulator of T-type calcium channels, is in clinical development for the treatment of ET and Parkinson’s disease tremor.
•Patient enrollment is ongoing in the Phase 2b ET trial and top-line data readout is anticipated in 1H24.
•A Phase 2 trial in patients with Parkinson’s disease tremor is ongoing.

4

JZP441:
•JZP441, is a potent, highly selective oral orexin-2 receptor agonist designed to activate orexin signaling with the potential to be applicable in the treatment of narcolepsy, IH and other sleep disorders.
•A Phase 1 development program to evaluate safety, tolerability, pharmacokinetics and pharmacodynamics of JZP441 in sleep-deprived healthy volunteers is ongoing.
•The Company expects initial proof of concept in healthy volunteers in 2023.

JZP815:
•A Phase 1 trial evaluating JZP815 in patients with advanced or metastatic solid tumors with MAPK pathway alterations is ongoing.
•The pan-RAF inhibitor program is part of a novel class of next-generation precision oncology therapies that has the potential to benefit cancer patients with high unmet needs in multiple different solid tumors.

JZP898:
•JZP898 is an engineered IFNα cytokine pro-drug that is activated specifically within the tumor microenvironment where it can stimulate IFNα receptors on cancer-fighting immune effector cells.
•In July 2023, JZP898 received Investigational New Drug (IND) application clearance. The Company expects to initiate a Phase 1 clinical trial by the end of the year.

Resumption of Repurchases under Previously Announced $1.5 Billion Share Repurchase Program

The Company resumed repurchases of its ordinary shares on the open market in the second quarter of 2023 as part of the Company’s previously authorized and announced share repurchase program. Under the share repurchase program, the Company may repurchase its ordinary shares for up to an aggregate purchase price of $1.5 billion, exclusive of any brokerage commissions. As of June 30, 2023, approximately $336 million remained available and authorized for share repurchases under the program, reflecting the purchase of approximately $100 million shares during the second quarter of 2023. The timing and amount of repurchases under the program will depend on a variety of factors, including the price of the Company’s ordinary shares, alternative investment opportunities, restrictions under the Company’s credit agreement, corporate and regulatory requirements and market conditions.

Irrevocable Election of Settlement Method of $575 Million for the 1.50% Exchangeable Senior Notes due 2024

Jazz Investments I Limited, a wholly-owned subsidiary of the Company, announced that it provided written notice today to the exchange agent, the trustee and the noteholders of its 1.50% exchangeable senior notes due 2024 (2024 Notes) that it has irrevocably elected to fix the settlement method for exchanges of the 2024 Notes to a combination of cash and ordinary shares of the Company with a specified cash amount per $1,000 principal amount of 2024 Notes of $1,000. As a result, for 2024 Notes exchanged subsequent to such notice, an exchanging noteholder will receive (i) up to $1,000 in cash per $1,000 principal amount of 2024 Notes and (ii) ordinary shares of the Company, together with cash in lieu of any fractional shares, for any exchange consideration in excess of $1,000 per $1,000 principal amount of 2024 Notes.

5

Financial Highlights
Three Months Ended
June 30, Six Months Ended
June 30,
(In thousands, except per share amounts) 2023 2022 2023 2022
Total revenues $ 957,317 $ 932,878 $ 1,850,129 $ 1,746,599
GAAP net income $ 104,438 $ 34,665 $ 173,858 $ 36,312
Non-GAAP adjusted net income $ 325,129 $ 305,465 $ 610,390 $ 567,399
GAAP earnings per share $ 1.52 $ 0.55 $ 2.55 $ 0.57
Non-GAAP adjusted EPS $ 4.51 $ 4.30 $ 8.46 $ 8.03

GAAP net income for 2Q23 was $104.4 million, or $1.52 per diluted share, compared to $34.7 million, or $0.55 per diluted share, for 2Q22.
Non-GAAP adjusted net income for 2Q23 was $325.1 million, or $4.51 per diluted share, compared to $305.5 million, or $4.30 per diluted share, for 2Q22.
Reconciliations of applicable GAAP reported to non-GAAP adjusted information are included at the end of this press release.

Total Revenues
Three Months Ended
June 30, Six Months Ended
June 30,
(In thousands) 2023 2022 2023 2022
Xywav $ 326,564 $ 235,025 $ 604,325 $ 421,105
Xyrem 159,769 269,421 337,899 516,918
Total Oxybate 486,333 504,446 942,224 938,023
Epidiolex/Epidyolex 202,226 175,289 391,135 333,182
Sativex 2,806 4,142 9,904 8,884
Sunosi1
— 12,966 — 28,844
Total Neuroscience 691,365 696,843 1,343,263 1,308,933
Rylaze 101,693 72,954 187,620 127,174
Zepzelca 70,348 68,285 137,529 127,623
Defitelio/defibrotide 46,108 54,696 85,187 104,185
Vyxeos 34,056 33,890 70,756 67,647
Total Oncology 252,205 229,825 481,092 426,629
Other 3,417 1,632 6,851 2,575
Product sales, net 946,987 928,300 1,831,206 1,738,137
High-sodium oxybate AG royalty revenue 5,514 — 7,610 —
Other royalty and contract revenues 4,816 4,578 11,313 8,462
Total revenues $ 957,317 $ 932,878 $ 1,850,129 $ 1,746,599

___________________________
(1)Divestiture of Sunosi U.S. was completed in May 2022.

Total revenues increased 3% in 2Q23 compared to the same period in 2022.
•Total neuroscience revenue, including high-sodium oxybate AG royalty revenue, was $696.9 million in 2Q23 compared to $696.8 million in 2Q22. Neuroscience net product sales in 2Q23 decreased 1% to $691.4 million compared to the same period in 2022 primarily driven by decreased Xyrem revenues, reflecting the continued strong adoption of Xywav by patients with narcolepsy and the launch of a high-sodium oxybate AG in January 2023, offset by increased Xywav and Epidiolex/Epidyolex net product sales. High-sodium oxybate AG royalty revenue
6

relates to royalty revenue received from Hikma Pharmaceuticals plc on net sales of a high-sodium oxybate AG product.
•Oncology net product sales in 2Q23 increased 10% to $252.2 million compared to the same period in 2022 primarily driven by the continued growth in Rylaze product sales, which increased 39% to $101.7 million.

Operating Expenses and Effective Tax Rate
Three Months Ended
June 30, Six Months Ended
June 30,
(In thousands, except percentages) 2023 2022 2023 2022
GAAP:
Cost of product sales $ 97,537 $ 124,208 $ 226,181 $ 239,492
Gross margin 89.7% 86.6% 87.6% 86.2%
Selling, general and administrative $ 340,844 $ 366,473 $ 638,761 $ 675,286
% of total revenues 35.6% 39.3% 34.5% 38.7%
Research and development $ 209,238 $ 139,047 $ 398,648 $ 269,028
% of total revenues 21.9% 14.9% 21.5% 15.4%
Acquired in-process research and development $ — $ 69,148 $ 1,000 $ 69,148
Income tax benefit $ (24,323) $ (16,112) $ (39,647) $ (15,576)
Effective tax rate 1
(29.7)% (76.7)% (29.0)% (57.0)%

_________________________

(1)The GAAP effective tax rates increased for the three and six months ended June 30, 2023 compared to the same periods in 2022, due to the impact of the disposal of Sunosi in 2022.

Three Months Ended
June 30, Six Months Ended
June 30,
(In thousands, except percentages) 2023 2022 2023 2022
Non-GAAP adjusted:
Cost of product sales $ 65,994 $ 53,245 $ 130,722 $ 101,451
Gross margin 93.0% 94.3% 92.9% 94.2%
Selling, general and administrative $ 276,871 $ 281,493 $ 537,386 $ 540,194
% of total revenues 28.9% 30.2% 29.0% 30.9%
Research and development $ 192,019 $ 123,719 $ 365,937 $ 240,178
% of total revenues 20.1% 13.3% 19.8% 13.8%
Acquired in-process research and development $ — $ 69,148 $ 1,000 $ 69,148
Income tax expense $ 25,210 $ 38,387 $ 65,407 $ 93,610
Effective tax rate 7.2% 11.1% 9.6% 14.0%

Changes in operating expenses in 2Q23 over the prior year period are primarily due to the following:
•Cost of product sales decreased in 2Q23 compared to the same period in 2022, on a GAAP basis, primarily due to lower acquisition accounting inventory fair value step-up expense, partially offset by changes in product mix. Cost of product sales increased in 2Q23 compared to the same period in 2022, on a non-GAAP adjusted basis, primarily due to changes in product mix.
•Selling, general and administrative (SG&A) expenses decreased in 2Q23 compared to the same period in 2022, on a GAAP basis, primarily due to the loss on disposal of Sunosi and transaction and integration expenses related to the acquisition of GW Pharmaceuticals plc incurred in 2Q22, partially offset by costs related to program terminations. SG&A expenses, on a GAAP and on a
7

non-GAAP adjusted basis, included decreased compensation-related expenses primarily driven by lower headcount, increased litigation costs and increased investment in our priority programs.
•Research and development (R&D) expenses increased in 2Q23 compared to the same period in 2022, on a GAAP and on a non-GAAP adjusted basis, primarily due to the inclusion of costs related to zanidatamab, as well as our other key pipeline programs.

Cash Flow and Balance Sheet
As of June 30, 2023, cash, cash equivalents and investments were $1.4 billion, and the outstanding principal balance of the Company’s long-term debt was $5.8 billion. In addition, the Company had undrawn borrowing capacity under a revolving credit facility of $500 million. For the six months ended June 30, 2023, the Company generated $617.5 million of cash from operations, which is an increase of $105.5 million as compared to the same period in 2022, reflecting strong business performance and continued financial discipline.

8

2023 Financial Guidance
The Company is updating its full year 2023 financial guidance as follows:

(In millions) August 9, 2023 May 10, 2023
Revenues $3,725 – $3,875 $3,675 – $3,875
–Neuroscience (includes royalties from high-sodium oxybate AG)
$2,715 – $2,825 $2,675 – $2,825
–Oncology $950 – $1,050 $950 – $1,050

GAAP:
(In millions, except per share amounts and percentages) August 9, 2023 May 10, 2023
Gross margin % 89% 89%
SG&A expenses $1,220 – $1,295 $1,197 – $1,277
SG&A expenses as % of total revenues 31% – 35% 31% – 35%
R&D expenses $739 – $793 $739 – $797
R&D expenses as % of total revenues 19% – 21% 19% – 22%
Effective tax rate (35)% – (15)% (32)% – (8)%
Net income $450 – $565 $410 – $560
Net income per diluted share5
$6.60 – $8.15 $5.90 – $7.90
Weighted-average ordinary shares used in per share calculations5
72 75

Non-GAAP:
(In millions, except per share amounts and percentages) August 9, 2023 May 10, 2023
Gross margin %
93%1,6
93%
SG&A expenses
$1,045 – $1,1052,6
$1,045 – $1,105
SG&A expenses as % of total revenues 27% – 30% 27% – 30%
R&D expenses
$675 – $7253,6
$675 – $725
R&D expenses as % of total revenues 17% – 19% 17% – 20%
Effective tax rate
8% – 10%4,6
9% – 11%
Net income
$1,290 – $1,3406
$1,240 – $1,310
Net income per diluted share5
$18.15 – $19.006
$16.90 – $17.85
Weighted-average ordinary shares used in per share calculations5
72 75

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1.Excludes $135-$155 million of amortization of acquisition-related inventory fair value step-up and $14-$15 million of share-based compensation expense.
2.Excludes $152-$167 million of share-based compensation expense and $23 million of restructuring costs.
3.Excludes $64-$68 million of share-based compensation expense.
4.Excludes 43%-25% from the GAAP effective tax rate of (35)%-(15)% relating to the income tax effect of adjustments between GAAP net income and non-GAAP adjusted net income, resulting in a non-GAAP adjusted effective tax rate of 8%-10%.
5.Diluted EPS calculations for 2023 include an estimated 8 million shares related to the assumed conversion of the Exchangeable Senior Notes and the associated interest expense add-back to net income of $25 million and $22 million, on a GAAP and on a non-GAAP adjusted basis, respectively, under the "if converted" method. On August 9, 2023, we made the irrevocable election to net share settle our 2024 Notes. This election is expected to impact our full-year net income per diluted share guidance by $0.05 to $0.10 per share, on a GAAP basis, and $0.25 to $0.40 per share, on a Non-GAAP adjusted basis, as a result of an estimated decrease in the weighted-average shares outstanding of 1 million shares.
6.See "Non-GAAP Financial Measures" below. Reconciliations of non-GAAP adjusted guidance measures are included above and, in the table titled "Reconciliation of GAAP to non-GAAP Adjusted 2023 Net Income Guidance" at the end of this press release.

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Conference Call Details
Jazz Pharmaceuticals will host an investor conference call and live audio webcast today at 4:30 p.m. ET (9:30 p.m. IST) to provide a business and financial update and discuss its 2023 second quarter results.