On December 9, 2019 Avid Bioservices, Inc. (NASDAQ:CDMO) (NASDAQ:CDMOP), a dedicated biologics contract development and manufacturing organization (CDMO) working to improve patient lives by providing high quality development and manufacturing services to biotechnology and pharmaceutical companies, reported financial results for the second quarter of fiscal 2020 ended October 31, 2019 (Press release, Avid Bioservices, DEC 9, 2019, View Source [SID1234552106]).

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Highlights Since July 31, 2019

"During the second quarter of 2020, we strengthened multiple core areas of our business," said Rick Hancock, interim president and chief executive officer of Avid. "Our business development effort continues to be wide reaching and robust. Our reputation in the industry for quality and regulatory success continues to grow allowing us to engage with a broadening pool of potential new customers and expand our relationships with existing customers.

"Operationally, we continue to improve and enhance our equipment, facilities and systems. The opening of our new process development lab, the successful completion of our annual maintenance overhaul, and the planned installation of a new pharmaceutical grade water system in calendar 2020 all reflect the dedication we have to maintaining the highest standards possible.

"The revenues for this quarter were the highest since Avid transitioned to a pure-play CDMO in January 2018, and we achieved 18% gross margin, which represents a significant increase year-over-year as well as quarter-over-quarter. Expenses remained in line with expectations and our backlog continues to be strong. Also important, during the quarter we approached breakeven income from operations.

"Productivity and efficiency contributed significantly to Avid’s strong second quarter results, and we expect that our financial performance will continue to track positively with these factors. We believe that Avid has turned an important corner, creating a stronger platform from which to achieve sustainable profitability."

Financial Highlights and Guidance

The company is confirming prior revenue guidance for the full fiscal year 2020 of $64 million – $67 million.

Revenue was $18.3 million for the second quarter of fiscal 2020, an increase of 80% as compared to $10.2 million for the second quarter of last fiscal year. For the six months ended October 31, 2019, revenues were $33.6 million, a 47% increase as compared to revenues of $22.8 million during the prior period. Increases during both current-year periods were primarily due to an increase in the number of in-process and completed manufacturing runs as a result of growing demand from a more diversified client base.

As of October 31, 2019, revenue backlog was approximately $52 million, a decrease of 16% as compared to the first quarter of fiscal 2020. The company expects to recognize the majority of this backlog within the next 12 months.

Gross margin for the second quarter of fiscal 2020 of 18% was up significantly compared to a gross margin of 3% in the prior period. Gross margin for the six months ended October 31, 2019 was 13%, up significantly compared to 7% in the prior period. These increases were primarily attributed to the increased number of manufacturing runs, partially offset by costs associated with the hiring of personnel to accommodate growth in production demand, increases in other compensation expenses, and equipment repairs.

Selling, general and administrative expenses ("SG&A") for the second quarter of fiscal 2020 were $3.5 million compared to $2.8 million for the second quarter of last year. The increase was primarily attributed to payroll and related costs, and stock-based compensation. For the first six months of fiscal 2020, SG&A expenses were $8.0 million compared to $6.0 million for the first six months of fiscal 2019. The increases in SG&A during the six-month period were primarily attributed to payroll and related costs, including one-time employee separation-related expenses, and increased stock-based compensation.

In September 2019, the company recognized a one-time loss of $0.4 million in connection with the termination of a non-manufacturing facility lease, which reduces our future lease and related payments by approximately $1.3 million over the next four years. Additionally, the lease termination released $0.3 million of restricted cash that was pledged as collateral under a letter of credit required by the terminated lease back to the company. The lease termination of this redundant warehouse space has no impact on our future expansion plans, as the company continues to have 42,000 square feet available within our Myford facility.

For the second quarter of fiscal 2020, the company recorded a consolidated net loss attributable to common stockholders of $1.9 million or $0.03 per share, compared to a consolidated net loss attributable to common stockholders of $2.9 million or $0.05 per share, for the prior year period. For the first six months of fiscal 2020, the company recorded a consolidated net loss attributable to common stockholders of $6.1 million or $0.11 per share, compared to a consolidated net loss attributable to common stockholders of $5.9 million or $0.11 per share, for the prior year period.

Avid reported $34.0 million in cash and cash equivalents as of October 31, 2019, compared to $32.4 million on April 30, 2019.
More detailed financial information and analysis may be found in Avid Bioservices’ Quarterly Report on Form 10-Q, which will be filed with the Securities and Exchange Commission today.

Recent Corporate Developments

Launched expanded process development (PD) facility and services. This purpose-built state-of-the-art facility, which houses Avid’s expanded upstream and downstream process development capabilities, represents an important new opportunity for the company by allowing us to expand our existing relationships and attract new business by offering support to customers that seek to outsource their PD work.

Expanded scope of work with multiple existing customers to increase the number of manufacturing batches and/or scale of production.

Appointed Richard (Rich) Richieri as chief operations officer. Mr. Richieri will oversee Process Development, Clinical and Commercial Manufacturing, Technical Support and Facilities. In this role, Mr. Richieri will be focused on streamlining operations, building internal efficiencies and strategic planning for future growth. Mr. Richieri has over 25 years of biopharmaceutical industry experience spanning the areas of drug discovery, CGMP operations, contract manufacturing and process development. Mr. Richieri previously spent 15 years with Avid Bioservices and its former parent company, Peregrine Pharmaceuticals, including the role of senior vice president of manufacturing. During that time, he was instrumental in launching, building and growing Avid’s CDMO business and helping the company diversify its production capabilities.

Initiated final design stage for the construction of a new pharmaceutical grade water system in the Myford facility. Installation of this system will supply water to multiple manufacturing systems, a critical step in creating the manufacturing efficiencies required to increase output and strengthen margins. The company expects the system to be installed in calendar 2020.
Conference Call

Avid will host a conference call and webcast this afternoon, December 9, 2019, at 4:30 PM ET (1:30 PM PT).

To listen to the conference call, please dial (877) 312-5443 or (253) 237-1126 and request the Avid Bioservices conference call. To listen to the live webcast, or access the archived webcast, please visit: View Source

On December 9, 2019 Astex Pharmaceuticals, Inc., a wholly owned subsidiary of Otsuka Pharmaceutical Co. Ltd., based in Tokyo, Japan, reported that topline data from the ASCERTAIN phase 3 trial of the orally administered fixed dose combination of cedazuridine and decitabine (ASTX727) in adults with intermediate and high-risk myelodysplastic syndromes (MDS) including chronic myelomonocytic leukemia (CMML) (Press release, Astex Pharmaceuticals, DEC 9, 2019, View Source [SID1234552105]). The data were featured in an oral presentation given today at the American Society of Hematology (ASH) (Free ASH Whitepaper) Meeting in Orlando, Florida by Dr Guillermo Garcia-Manero, MD, Professor and Chief of Section of Myelodysplastic Syndromes, Department of Leukemia at The University of Texas MD Anderson Cancer Center, Houston, Texas, on behalf of the study investigators.

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The study was designed as a randomized crossover study comparing oral ASTX727 (100mg cedazuridine and 35mg decitabine fixed dose combination tablet given once daily for 5 days on a 28-day cycle) to IV decitabine (20mg/m2 administered as a daily 1-hour IV infusion for 5 days on a 28 day cycle) in the first 2 cycles with patients continuing to receive oral ASTX727 from Cycle 3 onwards. The data presented demonstrated that the ASCERTAIN study met the primary endpoint of total 5-Day decitabine Area-Under-The-Curve (AUC) equivalence of oral ASTX727 and IV decitabine. The oral/IV decitabine 5-day AUC was 98.9% with a 90% Confidence Interval between 92.7% and 105.6%. Safety findings from the study were consistent with those anticipated with IV decitabine, with no significant differences in the incidence of most common adverse events between ASTX727 and IV decitabine in the first 2 randomized cycles. The most common adverse events (AEs) of any grade >20% regardless of causality in patients in the first 2 randomized cycles who received ASTX727 were thrombocytopenia (43.8%); neutropenia (35.4%); anemia (36.9%); and fatigue (23.8%). Preliminary clinical activity as of the data cutoff was also consistent with published data for IV decitabine. In evaluable patients, the Complete Response (CR) rate was 12%, with an overall response rate, including hematological improvement, of 64%.

"The ASCERTAIN phase 3 study data confirms the hypothesis that by inhibiting cytidine deaminase in the gut, systemic therapeutic concentrations of decitabine can be delivered orally to achieve decitabine systemic exposure equivalent to IV dosing," said Dr Garcia-Manero. "The data support that ASTX727 could become an oral hypomethylating agent alternative to IV decitabine."

"Based on the data from the ASTX727 clinical program, including the ASCERTAIN phase 3 study, Astex is moving ahead with plans to file a New Drug Application (NDA) with the US Food & Drug Administration (FDA)," said Dr Mohammad Azab, MD, President & Chief Medical Officer of Astex Pharmaceuticals, Inc. "Subject to regulatory review and approval, ASTX727 may offer a new option for patients with MDS and CMML that saves them the burden of 5-day IV infusions every month during their treatment period. We are extremely grateful to all the patients, caregivers, partner research and manufacturing organizations, as well as the healthcare professionals who contributed to the clinical development program of ASTX727."

ASTX727 is an investigational compound and is not currently approved in any country.

Astex’s parent company, Otsuka Pharmaceutical Co., Ltd., and Taiho Pharmaceutical Co., Ltd. previously announced that, subject to regulatory approvals, commercialization of ASTX727 in the US and Canada will be conducted by Taiho Oncology, Inc. and Taiho Pharma Canada, Inc. respectively. Astex, Otsuka and Taiho are all members of the Otsuka group of companies.

The presentation can be downloaded from the Astex website at View Source

About Cedazuridine and Decitabine Fixed-Dose Combination (ASTX727)

ASTX727 is a novel, orally administered fixed dose combination of cedazuridine, an inhibitor of cytidine deaminase,1 with the anti-cancer DNA hypomethylating agent, decitabine.2 By inhibiting cytidine deaminase in the gut and the liver, ASTX727 is designed to allow for oral delivery of the approved DNA hypomethylating agent, decitabine, at exposures which emulate exposures achieved with the approved intravenous form of decitabine administered over 5 days.3

ASTX727 has been evaluated in a phase 1/2 pharmacokinetics-guided dose escalation and dose confirmation study in patients with MDS and CMML (see View Source NCT02103478) and a pivotal phase 3 study (ASCERTAIN) (see View Source NCT03306264) conducted at investigator sites in the US and Canada and designed to confirm the results from the phase 1/2 study. The phase 3 study is now being extended to include patients with acute myeloid leukemia (AML) unsuitable to receive intensive induction chemotherapy.

In September 2019 Astex announced that ASTX727 had received orphan drug designation for the treatment of MDS and CMML from the US FDA.

The concept of using cedazuridine to block the action of cytidine deaminase is also being evaluated in a low dose formulation of cedazuridine and decitabine for the treatment of lower risk MDS (see View Source NCT03502668).

About Myelodysplastic Syndromes (MDS) and Chronic Myelomonocytic Leukemia (CMML)

Myelodysplastic syndromes are a heterogeneous group of hematopoietic stem cell disorders characterized by dysplastic changes in myeloid, erythroid, and megakaryocytic progenitor cells, and associated with cytopenias affecting one or more of the three lineages. US incidence of MDS is estimated to be 10,000 cases per year, although the condition is thought to be under-diagnosed.4,5 The prevalence has been estimated to be from 60,000 to 170,000 in the US.6 MDS may evolve into acute myeloid leukemia (AML) in one-third of patients.7 The prognosis for MDS patients is poor; patients die from complications associated with cytopenias (infections and bleeding) or from transformation to AML. CMML is a clonal hematopoietic malignancy characterized by accumulation of abnormal monocytes in the bone marrow and in blood. The incidence of CMML in the US is approximately 1,100 new cases per year,8 and CMML may transform into AML in 15% to 30% of patients.9 The hypomethylating agents decitabine and azacitidine are effective treatment modalities for hematologic cancers and are FDA-approved for the treatment of higher risk MDS and CMML. These agents are administered by IV infusion, or by large-volume subcutaneous injections.

On December 9, 2019 ArQule, Inc. (Nasdaq: ARQL) reported final results from the phase 1 study for ARQ 531, an orally bioavailable, potent and reversible dual inhibitor of both wild type and C481S-mutant Bruton’s tyrosine kinase (BTK) in patients with relapsed or refractory hematologic malignancies at the American Society of Hematology (ASH) (Free ASH Whitepaper) 2019 Annual Meeting & Exposition in Orlando, Florida (Press release, ArQule, DEC 9, 2019, View Source [SID1234552104]).

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"The final phase 1 data set confirms the potential utility of ARQ 531 for the treatment of these heavily pretreated CLL patients. We were excited to observe such deep and durable responses at a well-tolerated dose in this highly refractory population," commented Dr. Brian Schwartz, Chief Medical Officer of ArQule. "In addition, the three responses we observed in Richter’s Transformation patients were a welcome outcome and allowed several patients to transition to potentially curative therapies."

"ARQ 531 was selected and extensively tested preclinically to address the emerging therapeutic needs of patients who have become resistant to covalent BTK inhibitors in a broad set of hematologic malignancies," commented Dr. Jennifer Woyach, Associate Professor of Medicine at The Ohio State University and the Principal Investigator of the study. "It is tremendously gratifying to witness the emergence of a potential therapeutic for patients with such a high degree of unmet need, such as C481S-mutant CLL and Richter’s Transformation, and beyond. The data presented in this poster provide compelling proof-of-concept for this novel class of reversible BTK inhibitors."

The reported data are from the phase 1, open label, single arm dose escalation study and include patients (n=47) initially dosed at levels of 5, 10, 15, 20, 30, 45, 65 and 75 mg once a day with relapsed or refractory chronic lymphocytic leukemia (CLL), small lymphocytic leukemia (SLL), Richter’s Transformation, Waldenström macroglobulinemia and other B-cell Non-Hodgkin lymphomas.

Key Findings:

65 mg QD was selected as the Recommended Phase 2 Dose (RP2D) for further studies
Across all disease subsets, ARQ 531 showed a low incidence of associated toxicities, including one grade three DLT and no atrial fibrillation or bleeding observed
At 65 mg QD, ARQ 531 has a steady state mean Cmin above 1 µM and long plasma half-life of 56 hours resulting in complete pBTK inhibition
Clinical Anti-Tumor Activity:
In CLL, an Overall Response Rate (ORR) of 89% (8/9 responses in evaluable patients) was achieved in heavily pretreated R/R CLL patients (7/8 harboring BTK-C481S mutation) dosed at ≥65 mg QD. Eleven of 19 patients treated at 65 mg QD remain on study
In Richter’s Transformation, an ORR of 50% (3/6 responses in evaluable patients) was achieved at 65 mg QD
Two additional PRs were observed including one patient with Follicular Lymphoma (FL) and 1 patient with Diffuse Large B-cell Lymphoma (DLBCL)
Durability:
100% (5/5) evaluable CLL patients that received a third scan (cycle 9) are durable confirmed PRs and remain on therapy
67% (2/3) of Richter’s patients that achieved PRs came off study after becoming eligible for CAR-T therapy
The Follicular Lymphoma patient that achieved a PR has been on study for 120 weeks and remains a PR and on therapy
The poster at ASH (Free ASH Whitepaper) presenting these data entitled, "Final Results of Phase 1, Dose Escalation Study Evaluating ARQ 531 in Patients with Relapsed or Refractory B-Cell Lymphoid Malignancies," is available on the company’s website at www.arqule.com/publications-presentations/.

In addition, earlier today Merck and ArQule announced that the companies have entered into a definitive agreement under which Merck, through a subsidiary, will acquire ArQule. A copy of the joint press release is available on ArQule’s website, www.arqule.com.

ArQule will host a conference call and webcast for investors on Monday, December 9, 2019 at 8:15 a.m. EST to discuss the ARQ 531 clinical data. The live webcast can be accessed in the "Investors and Media" section of our website, www.arqule.com, under "Events & Presentations" or by visiting click here. You may also listen to the call by dialing (877) 868-1831 within the U.S. or (914) 495-8595 outside the U.S. and providing conference ID 4573858. A replay will be available two hours after the completion of the call and can be accessed in the "Investors & Media" section of our website, www.arqule.com, under "Events and Presentations."

ArQule management will host an Investor Event to answer questions and discuss these data in Orlando tonight, Monday, December 9, 2019 from 8:00–10:00 p.m. EST. Investors, sell side analysts, and industry representatives are welcome to attend. For event details and to RSVP, please email [email protected].

About BTK and ARQ 531

Bruton’s tyrosine kinase, BTK, is a therapeutic target that has been clinically proven to inhibit B-cell receptor signaling in blood cancers. ARQ 531 is an orally bioavailable, potent and reversible dual inhibitor of both wild type and C481S-mutant BTK. The C481S-mutation is a known resistance mechanism for first generation irreversible BTK inhibitors. ARQ 531 has demonstrated a manageable safety profile, predictable PK, convincing pharmacodynamic effects and signs of clinical activity.

On December 9, 2019 Aptose Biosciences Inc. (NASDAQ: APTO, TSX: APS) reported that highlights from a corporate event and clinical update held at the 61st American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exposition in Orlando, FL (Press release, Aptose Biosciences, DEC 9, 2019, View Source [SID1234552103]). The event was hosted by the Aptose management team and included Stephen B. Howell, MD, Acting Chief Medical Officer, Distinguished Professor of Medicine, Moores Cancer Center, University of California, San Diego (UCSD); with analysis by Rafael Bejar, MD, PhD, Aptose’s incoming Senior Vice President and Chief Medical Officer and currently the Director, MDS Center of Excellence, Moores Cancer Center, UCSD; and participation remotely by Brian J. Druker, MD, Chair of the Aptose Scientific Advisory Board, Professor of Medicine, Division of Hematology/Medical Oncology, Director, Knight Cancer Institute, Oregon Health & Science University.

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The slides are available and the recording of the presentation will be archived on Aptose’s website here shortly after the conclusion of the event.

As the first clinical data from CG-806 in patients with chronic lymphocytic leukemia (CLL) have begun to emerge, Drs. Howell, Bejar, and Druker highlighted the consistency between the drug’s robust preclinical profile and the early clinical observations on safety, tolerability, pharmacokinetics, and activity. William G. Rice, Ph.D., Chairman, President and Chief Executive Officer of Aptose also provided a corporate update on the clinical activities of CG-806, Aptose’s highly potent pan-FLT3/pan-BTK inhibitor.

CG-806, an oral, first-in-class mutation-agnostic FLT3/BTK kinase inhibitor, is in a Phase 1 trial in patients with B cell malignancies, including CLL and non-Hodgkin lymphomas (NHL), who have failed or are intolerant to standard therapies. The first two dose levels, which required only one patient at each level, are complete. The first two patients, both of whom were CLL patients that had previously failed a host of other agents, completed multiple dose cycles at 150 mg BID and 300 mg BID, respectively. Screening is ongoing for the third dose level, which is planned to enroll three patients.

Key findings from dose levels 1 and 2 of CG-806 in heavily pretreated R/R CLL patients:

CG-806’s safety profile remains clean; no unexpected toxicities have been observed to date
Notably, no myelosuppression, no drug-related adverse events or dose-limiting toxicity

Early evidence of clinical response has already been observed in a R/R CLL patient at dose level 2
Robust increase in peripheral blood lymphocytes (lymphocytosis)

Evidence of Bruton’s tyrosine kinase (BTK) target engagement
Lymphocytosis, which is known as an indicator of BTK inhibition
Inhibition of Phospho-BTK, Phospho-SYK and Phospho-ERK have been observed with a plasma inhibitory assay (PIA) using plasma from the CLL patient on dose level 2

Meaningful oral absorption and predictable pharmacokinetic (PK) profile

Exposures are likely therapeutic for acute myeloid leukemia (AML) patients
A separate trial with CG-806 in relapsed/refractory AML patients is in the planning stage
APTO-253, the only clinical stage agent that directly targets the MYC oncogene, is demonstrating safety and MYC target engagement in a Phase 1b clinical trial for the treatment of patients with relapsed or refractory AML or high-risk myelodysplastic syndrome (MDS).

Key highlights:

Aptose has completed dosing of the first three cohorts (up to a dose of 66 mg/m2) of the Phase 1b trial with MYC inhibitor APTO-253 in patients with AML and MDS.

In the patients on the first three dose cohorts, no drug-related adverse events have been observed, including no myelosuppression, and dosing is planned to continue to ascend until a maximum tolerated dose is reached. The next expected dosing level is 100 mg/m2.

MYC biomarker data from AML and MDS patients in the first three cohorts continue to demonstrate reductions of MYC gene expression in their peripheral blood cells. The dose escalation portion of the study is designed to transition, as appropriate, to single-agent expansion cohorts in AML and MDS, followed by combination studies.
The Company continues to escalate dosing with both assets, as all current dose cohorts to date have exhibited favorable safety profiles and evidence of target engagement.

On December 9, 2019 Amarantus Bioscience Holdings, Inc. (OTC Pink: AMBS) (the "Company," or AMBS), a US-based JLABS-alumnus biotechnology holding company, developing first-in-class orphan neurologic, regenerative medicine and ophthalmic therapies, and diagnostics through its subsidiaries, reported that its President & CEO Gerald Commissiong will be presenting a corporate overview at the 12th Annual LD Micro Main Event on December 10th, 2019 at 4:00 p.m. PST (Press release, Amarantus Biosciences, DEC 9, 2019, View Source [SID1234552102]). Management will be available to meet with interested parties 1 on 1 throughout both events.

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Presentation Details

Event: 12th Annual LD Micro Invitation

Date: December 10, 2019

Time: 4:00 p.m. Pacific Time / 7:00 p.m. Eastern Time

Location: Luxe Sunset Hotel, 11461 Sunset Blvd, Los Angeles, CA 90049

Website: View Source