On November 5, 2019 XOMA Corporation (Nasdaq: XOMA) reported its third quarter 2019 financial results (Press release, Xoma, NOV 5, 2019, View Source [SID1234550350]).

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"XOMA’s portfolio of future potential royalty- and milestone-generating assets grew by 25% in the third quarter with the addition of 15 investigational compounds from Janssen Biotech and Palobiofarma. Since the third quarter of 2018, we have increased the number of assets in our royalty portfolio by 40%. We have firmly established XOMA as a potential source of non-dilutive, non-recourse capital among companies with partnered Phase 2 assets. We continue to assess multiple royalty monetization opportunities that could further expand and diversify our growing portfolio," said Jim Neal, Chief Executive Officer at XOMA.

Recent Updates About Partnered Assets in Development
Novartis listed on ClinicalTrials.gov a Phase 2 safety and efficacy study investigating iscalimab (CFZ533) in children and young adults recently diagnosed with Type 1 diabetes. ClincialTrials.gov Identifier: NCT04129528.

Janssen Biotech listed a Phase 1b study on ClinicalTrials.gov investigating JNJ-64407564 in patients with multiple myeloma. ClinicalTrials.gov Identifier: NCT04108195.

Takeda opened recruitment for its Phase 1 study to evaluate subcutaneous TAK-079 added to standard of care regimens in participants with newly diagnosed multiple myeloma. ClinicalTrials.gov Identifier: NCT03984097.

AVEO Pharmaceuticals listed on ClinicalTrials.gov a Phase 2 study of ficlatuzumab with high-dose cytarabine (HiDAC) and HiDAC alone in adults with relapsed or refractory acute myeloid leukemia. ClinicalTrials.gov Identifier: NCT04100330.

Business Highlights
XOMA acquired a royalty interest in six clinical-stage assets targeting the adenosine pathway for $10.0 million from Palobiofarma S.L., including NIR178, which is being developed by Novartis as a novel checkpoint inhibitor for the treatment of solid tumors. Palobiofarma is developing the other five assets.

The Company significantly increased its portfolio of potential future royalty and milestone payments with the addition of multiple Janssen Biotech, Inc., drug candidates for which XOMA could receive future milestone and royalty payments of 0.75% on net sales.

As a result of Rezolute, Inc.’s successful series of fundraising rounds, XOMA received $4.9 million in milestone payments during the third quarter. During its capital raising activities in the third quarter, Rezolute communicated its intent to commence a Phase 2b study for RZ358 during 2019.

Financial Results
XOMA recorded total revenues of $8.9 million for the third quarter of 2019, compared with $0.9 million in the third quarter of 2018. The increase was due to $6.0 million in revenue recognized from Rezolute and $2.5 million from Janssen Biotech, Inc., under our respective license agreements.

Research and development expenses were $0.1 million for the third quarter of 2019, compared to $0.6 million for the third quarter of 2018. The decrease for the three months ended September 30, 2019, compared to the same period of 2018, was primarily due to a $0.3 million pass-through license fee incurred based on the achievement of a development milestone by one of our partners in the third quarter of 2018 and a $0.2 million decrease in salary and related expenses.

General and administrative expenses were $5.8 million for the third quarter of 2019, compared to $4.7 million for the third quarter of 2018. The increase of $1.1 million for the three months ended September 30, 2019, as compared to the same period of 2018, was primarily due to executing a separation agreement with our Chief Business Officer resulting in $0.5 million in stock compensation expense associated with stock option modifications and $0.4 million in separation benefits.

Total other income, net was $0.8 million for the third quarter of 2019, compared to $0.9 million for the third quarter of 2018. The decrease of $0.1 million was primarily due to income of $0.5 million received in 2018 from Ology Bioservices related to the disposition the Company’s biodefense business in 2016, partially offset by an increase of $0.3 million in sublease income.

Net income for the third quarter of 2019 was $3.2 million, compared to net loss of $4.6 million for the third quarter of 2019.

On September 30, 2019, XOMA had cash of $39.7 million. The Company ended December 31, 2018, with cash of $45.8 million. During the third quarter of 2019, XOMA acquired a royalty interest position on six assets from Palobiofarma, including one asset being developed by Novartis. The $10.0 million Royalty Purchase Agreement with Palobiofarma, was funded with $5.0 million from XOMA’s cash balance and $5.0 million through a drawdown of XOMA’s line of credit from Silicon Valley Bank. The Company’s current cash balance is expected to be sufficient to fund its operations for multiple years.

On November 5, 2019 KIYATEC, Inc. reported that it will present data characterizing in vitro response to checkpoint inhibitors in solid tumors, a capability that addresses an important need in preclinical development of immuno-oncology (I/O) therapies (Press release, KIYATEC, NOV 5, 2019, View Source [SID1234550366]). The data will be presented at the 2019 Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) Annual Meeting, to be held November 6-10 in National Harbor, MD.

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Biologically relevant replication of complex interactions of human immune cells with tumor cells is an ongoing challenge using traditional preclinical models. Evidence presented by KIYATEC will highlight the utility of its in vitro 3D cell culture technology platform to characterize the tumor biology and immune activation and infiltration that precipitates response to checkpoint inhibitors across multiple solid tumor types. Data includes:

Complex 3D cultures derived from tumor cell lines or primary tumor tissue, incorporating allogeneic or autologous immune cells
High-throughput spheroid models used to detect dose-dependent response to checkpoint blockade and correlate with immune cell activation
Complex microtumor models that mirror immune cell infiltration, therapy-mediated reduction of microtumor growth and secretion of cytokines
"KIYATEC is pioneering advances in 3D cell culture technologies to address the unmet needs of biopharmaceutical companies engaged in pre-clinical testing of their I/O compounds," said Matthew Gevaert, CEO of KIYATEC. "Our emerging I/O models are currently being productively deployed across a number of pre-clinical initiatives and we anticipate that activity to increase as more drug developers become aware of our unique capabilities."

Presentation Details
Following are key details of the SITC (Free SITC Whitepaper) poster presentation:

Poster: P3
Title: Predicting patient response to checkpoint blockade therapy using in vitro 3D cultures
Date and Time: Friday, November 8, 12:30 – 2:00 pm, 6:30 – 8:00 pm, EST

On November 5, 2019 Allergan plc (NYSE: AGN) reported its third quarter 2019 financial results including GAAP net revenues of $4.05 billion, a 3.6 percent increase from the prior year quarter (Press release, Allergan, NOV 5, 2019, View Source [SID1234550382]).

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Executive Commentary

"The third quarter 2019 results demonstrate our commitment to continued strong operational performance. The core business has grown and has been bolstered by significant pipeline progress, with three new molecular entities currently under regulatory review," said Brent Saunders, Chairman and CEO of Allergan. "VRAYLAR, BOTOX Cosmetic, JUVÉDERM, BOTOX Therapeutic, OZURDEX and Lo LOESTRIN continue to lead the way, with VRAYLAR growing 70 percent and U.S. BOTOX Cosmetic growing 10 percent in the third quarter from the prior year."

Third Quarter 2019 Results

GAAP operating loss in the third quarter of 2019 was $596.6 million compared to GAAP operating income of $257.5 million in the prior year quarter. Non-GAAP operating income in the third quarter of 2019 was $1.76 billion, a decrease of 7.7 percent versus the prior year quarter, partially impacted by divestitures, products that lost or are at risk of losing exclusivity and an increase in operating expenses. GAAP cash flow from operations for the third quarter of 2019 totaled $2.92 billion. Cash flow from operations in the third quarter includes a one-time tax refund of $1.6 billion of capital gains taxes previously paid and attributable to tax losses recorded in prior periods.

Operating Expenses

Total GAAP Selling, General and Administrative (SG&A) Expense was $1.99 billion for the third quarter of 2019, compared to $1.04 billion in the prior year quarter. Total non-GAAP SG&A expense was $1.18 billion for the third quarter of 2019, an increase of 14.3 percent from the prior year quarter, primarily related to an increase in spending to support key products and new product launches. GAAP R&D investment for the third quarter of 2019 was $474.5 million, compared to $424.2 million in the third quarter of 2018. Non-GAAP R&D investment for the third quarter of 2019 was $448.9 million, an increase of 14.0 percent compared to the prior year quarter, due to increased direct project spend to support pipeline advancement and new product launches.

Amortization, Tax and Capitalization

Amortization expense for the third quarter of 2019 was $1.54 billion, compared to $1.59 billion in the third quarter of 2018. The Company’s GAAP tax rate was -2.4 percent in the third quarter of 2019. The Company’s non-GAAP adjusted tax rate was 11.2 percent in the third quarter of 2019. As of September 30, 2019, Allergan had cash and marketable securities of $4.56 billion and outstanding indebtedness of $22.5 billion.

Operating Charges and Impairments

Allergan recorded a pre-tax charge of $750 million in the three months ended September 30, 2019 related to a settlement reached in principle by subsidiaries Forest Laboratories, LLC, Forest Laboratories, Inc. and Forest Laboratories Holdings Ltd. with direct purchasers of Namenda, resolving the class action litigation filed by that class of purchasers in the U.S. District Court for the Southern District of New York. The Company excludes operating charges, asset sales and impairments, net and in-process research and development impairments from its Non-GAAP performance net income attributable to shareholders as well as Adjusted EBITDA and Non-GAAP Operating Income.

THIRD QUARTER 2019 BUSINESS SEGMENT RESULTS

U.S. Specialized Therapeutics

U.S. Specialized Therapeutics net revenues were $1.67 billion in the third quarter of 2019, a decrease of 2.1 percent versus the prior year quarter. Demand growth in BOTOX and JUVÉDERM Collection was offset by a decline in sales of CoolSculpting compared to the prior year quarter and the divestiture of the Company’s Medical Dermatology business on September 20, 2018. Segment gross margin for the third quarter of 2019 was 91.0 percent. Segment contribution for the third quarter of 2019 was $1.08 billion.

Medical Aesthetics

Facial Aesthetics
BOTOX Cosmetic net revenues in the third quarter of 2019 were $237.6 million, an increase of 10.0 percent from the prior year quarter.
JUVÉDERM Collection (defined as JUVÉDERM, VOLUMA and other fillers) net revenues in the third quarter of 2019 were $134.8 million, an increase of 6.0 percent versus the prior year quarter.
Regenerative Medicine
ALLODERM net revenues in the third quarter of 2019 were $95.0 million, a decrease of 10.2 percent versus the prior year quarter.
Body Contouring
CoolSculpting net revenues (including both CoolSculpting Systems/Applicators and Consumables) in the third quarter of 2019 were $53.0 million, a decrease of 37.6 percent from the prior year quarter.
Neurosciences & Urology

BOTOX Therapeutic net revenues in the third quarter of 2019 were $431.6 million, an increase of 5.9 percent versus the prior year quarter.
Eye Care

RESTASIS net revenues in the third quarter of 2019 were $286.8 million, a decrease of 3.8 percent versus the prior year quarter.
ALPHAGAN/COMBIGAN net revenues in the third quarter of 2019 were $90.9 million, a decrease of 4.7 percent versus the prior year quarter.
OZURDEX net revenues in the third quarter of 2019 were $33.7 million, an increase of 17.8 percent versus the prior year quarter.
U.S. General Medicine

U.S. General Medicine net revenues in the third quarter of 2019 were $1.52 billion, an increase of 9.9 percent versus the prior year quarter. Demand growth in VRAYLAR, VIIBRYD and Lo LOESTRIN was partially offset by lower revenues from products that lost exclusivity. Segment gross margin for the third quarter of 2019 was 83.9 percent. Segment contribution for the third quarter of 2019 was $967.2 million.

Central Nervous System

VRAYLAR net revenues were $234.6 million in the third quarter of 2019, an increase of 70.0 percent from the prior year quarter.
VIIBRYD/FETZIMA net revenues in the third quarter of 2019 were $105.1 million, an increase of 18.8 percent from the prior year quarter.
Gastrointestinal, Women’s Health & Diversified Brands

LINZESS net revenues in the third quarter of 2019 were $214.7 million, an increase of 4.8 percent versus the prior year quarter.
Lo LOESTRIN net revenues in the third quarter of 2019 were $161.4 million, an increase of 14.1 percent versus the prior year quarter.
BYSTOLIC/BYVALSON net revenues in the third quarter of 2019 were $152.2 million, an increase of 0.7 percent from the prior year quarter.
International

International net revenues in the third quarter of 2019 were $835.1 million, an increase of 5.0 percent versus the prior year quarter excluding foreign exchange impact. Growth in Facial Aesthetics and BOTOX Therapeutic was partially offset by declines in textured breast implants. OZURDEX growth was primarily related to a 2018 recall of OZURDEX in certain international markets. Segment gross margin for the third quarter of 2019 was 82.7 percent. Segment contribution was $437.6 million.

Facial Aesthetics

BOTOX Cosmetic net revenues in the third quarter of 2019 were $165.6 million, an increase of 5.8 percent versus the prior year quarter excluding foreign exchange impact.
JUVÉDERM Collection net revenues in the third quarter of 2019 were $144.7 million, an increase of 7.3 percent versus the prior year quarter excluding foreign exchange impact.
Eye Care

LUMIGAN/GANFORT net revenues in the third quarter of 2019 were $89.7 million, a decrease of 1.4 percent versus the prior year quarter excluding foreign exchange impact.
OZURDEX net revenues in the third quarter of 2019 were $63.8 million, an increase of 159.3 percent versus the prior year quarter excluding foreign exchange impact.
Botox Therapeutic

BOTOX Therapeutic net revenues in the third quarter of 2019 were $93.9 million, an increase of 5.3 percent versus the prior year quarter excluding foreign exchange impact.
PIPELINE UPDATE

Allergan R&D continues to advance its pipeline. During the third quarter of 2019, the Company’s key clinical developments included:

The U.S. Food and Drug Administration (FDA) approved Allergan’s supplemental Biologics License Application (sBLA) to expand the BOTOX (onabotulinumtoxinA) label for the treatment of pediatric patients ages two years and older with lower limb spasticity, excluding spasticity caused by cerebral palsy. This marks the 14th approved indication for BOTOX and BOTOX Cosmetic combined in the U.S., and the 11th BOTOX therapeutic indication. The FDA approved BOTOX (onabotulinumtoxinA) for pediatric upper limb spasticity in the second quarter of 2019.
The FDA accepted a Biologics License Application (BLA) for Abicipar pegol, a novel, investigational DARPin therapy, in patients with neovascular (wet) age-related macular degeneration (nAMD). The FDA is expected to take action on the BLA mid-2020, with launch expected to follow. The European Medicines Agency (EMA) is also reviewing a Marketing Authorisation Application (MAA) for Abicipar in patients with nAMD. A decision from the European Commission is expected in the second half of 2020.
Allergan received FDA approval for the use of Juvéderm VOLUMA XC, a hyaluronic acid gel dermal filler, with a TSK STERiGLIDE cannula for cheek augmentation to correct age-related volume deficit in the mid-face in adults over 21.
Allergan dosed the first patient in a Phase 2b clinical trial of botulinum neurotoxin serotype E (BoNT/E) EB-001 for the treatment of glabellar frown lines.
Allergan completed enrollment of Part 1 of the Phase 3 AURORA NASH study in adults with stages 2/3 liver fibrosis.
In addition to third quarter 2019 pipeline developments and the anticipated launch of abicipar listed above, Allergan expects three additional significant launches in the next twelve months:

Allergan anticipates a regulatory decision from the FDA in December 2019 for the Company’s New Drug Application (NDA) for ubrogepant, an oral CGRP receptor antagonist for the acute treatment of migraine. Launch is expected to follow in the first half of 2020.
Allergan expects to launch CoolTone, a body contouring device that uses magnetic muscle stimulation, or MMS technology, to strengthen, tone and firm the muscles of the abdomen, buttocks and thighs, in the fourth quarter of 2019, following FDA clearance in the second quarter of 2019.
FDA action is expected in the first half of 2020 on Allergan’s NDA for Bimatoprost Sustained-Release, a biodegradable implant for the reduction of intraocular pressure in patients with open-angle glaucoma or ocular hypertension. Launch is expected to follow in the first half of 2020.
UPDATE ON PROPOSED ABBVIE TRANSACTION

On October 14, 2019, Allergan shareholders voted to approve the proposed acquisition of Allergan by AbbVie. Additionally, both companies received a Request for Additional Information and Documentary Material (Second Request) from the U.S. Federal Trade Commission. Allergan and AbbVie continue to expect to close the transaction in early 2020, subject to customary closing conditions and regulatory approvals.

FULL YEAR 2019 GUIDANCE

(1) GAAP represents EPS for ordinary shareholders. GAAP income per share includes the impact of amortization of approximately $5.9 billion. Non-GAAP represents performance net income per share.

(2) GAAP EPS shares do not include dilution of shares when earnings are a net loss. As such, the dilution impact of outstanding equity awards is not included in the forecasted shares.

(3) The non-GAAP performance net income per share guidance for the twelve months ending December 31, 2019 of >$16.55 represents a "profit forecast" for the purposes of the Irish Takeover Rules. Please see page 7 of this press release for further information in relation to the basis of preparation of, assumptions behind and reports prepared in relation to that profit forecast.

ADDITIONAL THIRD QUARTER DETAILS

Due to the proposed acquisition of Allergan by AbbVie, Allergan is not hosting a conference call to discuss its third quarter results. For additional materials related to Allergan’s third quarter results, please visit Allergan’s Investor Relations website at View Source

On November 5, 2019 DaVita Inc. (NYSE: DVA) reported results for the quarter ended September 30, 2019 (Press release, DaVita, NOV 5, 2019, View Source [SID1234550497]).

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Third quarter 2019 financial and operational highlights:

Consolidated revenues of $2.904 billion.
Operating income of $378 million and adjusted operating income of $462 million.
Cash flows from continuing operations of $648 million.
Entered into a new $5.5 billion senior secured credit agreement and redeemed our 5.75% senior notes.
Repurchased 30,591,750 shares of our common stock at an average cost of $57.14 per share.

For the definitions of non-GAAP financial measures see the note titled "Note on Non-GAAP Financial Measures" and related reconciliations beginning at page 14.

Certain items impacting the quarter:

Debt transactions: On August 12, 2019, we entered into a new $5.5 billion senior secured credit agreement consisting of a $1.75 billion senior secured Term Loan A facility with a delayed draw feature, a $2.75 billion senior secured Term Loan B facility and a $1.0 billion senior secured revolving line of credit. As of September 30, 2019, the new Term Loan A and Term Loan B were fully drawn and the new revolving line of credit remained undrawn. We used the proceeds from the new senior secured credit facilities to pay off the remaining balances outstanding on our previous senior secured credit facilities, redeem our 5.75% senior notes due 2022 and pay related redemption fees, and fund our modified "Dutch auction" tender offer (Tender Offer) to purchase shares of our common stock as further described below, as well as to repurchase additional shares of our common stock through open market transactions. The remaining debt borrowings added cash to our balance sheet for potential acquisitions, share repurchases and other general corporate purposes.

As a result of the debt transactions described above, we recorded debt refinancing and redemption charges of $21 million in the third quarter of 2019. These charges consist of write-offs of old debt discount and deferred financing costs, as well as the redemption premium associated with our 5.75% senior notes and professional fees.

Share repurchases: The following table summarizes repurchases of our common stock during the three and nine months ended September 30, 2019.

The amount paid for shares repurchased associated with the Company’s Tender Offer during the three and nine months ended September 30, 2019 includes the clearing price of $56.50 per share plus related fees and expenses of $2 million.

In addition to the share repurchases described above, we have also repurchased 4,283,376 shares of our common stock for $246 million at an average cost of $57.32 per share from October 1, 2019 through November 4, 2019. Effective November 4, 2019, our Board of Directors terminated all remaining prior share repurchase authorizations available to us and approved a new share repurchase authorization of $2 billion.

Non-GAAP adjustments to operating income:

Goodwill impairment charge: During the quarter ended September 30, 2019, we recognized a non-cash goodwill impairment charge of $79 million in our Germany kidney care business as a result of continuing developments in the business and our expected timing and ability to mitigate them. This charge included a $17 million increase to the goodwill impairment charge due to the deferred tax assets that the impairment itself generated. The result was a $79 million goodwill impairment charge to operating income, a $17 million credit to tax expense, and a net $62 million impact on net income. We also recognized a $5 million goodwill impairment charge in our other German health operations.

For the definitions of non-GAAP financial measures see the note titled "Note on Non-GAAP Financial Measures" and related reconciliations beginning at page 14.

Volume: Total U.S. dialysis treatments for the third quarter of 2019 were 7,673,191, or an average of 97,129 treatments per day, representing a per day increase of 2.7% over the third quarter of 2018. Normalized non-acquired treatment growth in the third quarter of 2019 as compared to the third quarter of 2018 was 2.2%.

Effective income tax rate: Our effective income tax rate on income from continuing operations was 23.8% and 24.3% for the three and nine months ended September 30, 2019, respectively. This effective income tax rate was impacted by the amount of third party owners’ income attributable to non-tax paying entities. The effective income tax rate on income from continuing operations attributable to DaVita Inc. was 30.3% and 29.8% for the three and nine months ended September 30, 2019, respectively.

Our effective income tax rate on income from continuing operations attributable to DaVita Inc. for the three and nine months ended September 30, 2019 was further impacted by the write-off of deferred financing costs, other debt costs and goodwill impairment charges. Excluding these items from the three and nine months ended September 30, 2019, our effective income tax rate on adjusted income from continuing operations attributable to DaVita Inc. would have been 27.6% and 28.4% for the three and nine months ended September 30, 2019, respectively.

Center activity: As of September 30, 2019, we provided dialysis services to a total of approximately 233,300 patients at 2,985 outpatient dialysis centers, of which 2,736 centers were located in the United States and 249 centers were located in nine countries outside of the United States. During the third quarter of 2019, we opened a total of 24 new dialysis centers, acquired two dialysis centers and closed 13 dialysis centers in the United States. In addition, we opened one new dialysis center, acquired two dialysis centers and closed two dialysis centers outside of the United States during the third quarter of 2019.

Outlook:

The following forward-looking measures and the underlying assumptions involve significant risks and uncertainties, including those described below, and actual results may vary significantly from these current forward-looking measures. We do not provide guidance for consolidated operating income, diluted net income from continuing operations per share attributable to DaVita Inc. or effective tax rate on income from continuing operations on a GAAP basis nor a reconciliation of forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measures on a forward-looking basis because we are unable to predict certain items contained in the GAAP measures without unreasonable efforts. These non-GAAP financial measures do not include certain items, including goodwill impairment charges and foreign currency fluctuations, any of which may be significant. The guidance for effective income tax rate on adjusted income from continuing operations attributable to DaVita Inc. also excludes the write-off of deferred financing costs, other debt costs and the amount of third party owners’ income and related taxes attributable to non-tax paying entities.

We will be holding a conference call to discuss our results for the third quarter ended September 30, 2019, on November 5, 2019, at 5:00 p.m. Eastern Time. To join the conference call, please dial (877) 918-6630 from the U.S. or (517) 308-9042 from outside the U.S., and provide the operator the password ‘Earnings’. A replay of the conference call will be available on our website at investors.davita.com for the following 30 days.

On November 5, 2019 Curis, Inc. (NASDAQ: CRIS), a biotechnology company focused on the development of innovative therapeutics for the treatment of cancer, reported its financial results for the third quarter ended September 30, 2019 (Press release, Curis, NOV 5, 2019, View Source [SID1234550291]).

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"This past quarter, we made significant progress in advancing our clinical programs for fimepinostat and CA-4948, with continued enrollment across both Phase 1 trials and data readouts on-track for both programs in the fourth quarter of this year. We are particularly encouraged by the early indications of anti-cancer activity with CA-4948." said James Dentzer, President and Chief Executive Officer of Curis. "We are pleased by the safety and tolerability profile of CA-170 in our Phase 1 study and continue to believe VISTA is an important and scientifically-validated target. However, initial data suggest that CA-170 may not be an effective monotherapy agent for addressing VISTA in mesothelioma patients. We plan to further evaluate the translational science and clinical pharmacodynamics of CA-170, as well as the patient data from our Phase 1 study, to determine the optimal future clinical strategy for CA-170."

Third Quarter 2019 and Recent Operational Highlights

Precision oncology, fimepinostat (HDAC/PI3K inhibitor):

Curis is evaluating fimepinostat (a MYC suppressor) with venetoclax (a BCL-2 inhibitor) combination regimen in an ongoing Phase 1 study in diffuse large B-cell lymphoma (DLBCL), including patients with double-hit/double-expressor (DH/DE) lymphoma. DLBCL is often driven by specific alterations in both MYC and BCL2. In the clinic, fimepinostat and venetoclax have each demonstrated single-agent activity. In preclinical models, fimepinostat administered in combination with venetoclax resulted in an enhanced benefit relative to each agent alone.
Precision oncology, CA-4948 (IRAK4 Inhibitor; Aurigene collaboration):

Curis is evaluating CA-4948 in an ongoing Phase 1 dose escalation study in patients with non-Hodgkin lymphoma (NHL), including those with oncogenic MYD88 mutations and toll-like receptor (TLR) pathway activation. Curis plans to continue dose escalation in the study to determine the optimal dose for clinical development.
Curis plans to initiate a separate Phase 1 trial of CA-4948 in patients with acute myeloid leukemia (AML) and myelodysplastic syndromes (MDS), a focus on those with spliceosome mutations that encode oncogenic IRAK4-L.
Immuno-oncology, CA-170 (VISTA / PDL1 antagonist; Aurigene collaboration):

Curis released initial efficacy data from its Phase 1 study of CA-170 in malignant plural mesothelioma (MPM) patients (high VISTA expressors) in conjunction with the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) 2019 Annual Meeting. The Phase 1 study was designed to evaluate the safety, recommended Phase 2 dose, and maximum tolerated dose of CA-170. Secondary endpoints included pharmacokinetic (PK) and anti-cancer activity, and exploratory endpoints included biomarkers and pharmacodynamic (PD) effects. The study enrolled 12 patients with MPM across 6 study sites within the U.S. and U.K., randomizing patients into two cohorts. The high-dose cohort received 1,200 mg twice-daily (BID) of CA-170, while the low-dose cohort received 200 mg BID of CA-170. Patients who did not respond or experienced disease progression at the 200 mg BID dose were crossed over to the high-dose cohort.
Of 12 patients enrolled, 11 patients have discontinued study treatment, with no partial or complete responses observed, per Response Evaluation Criteria In Solid Tumors (RECIST), Immune-related Response Criteria (irRC) or modified RECIST 1.1 for mesothelioma.
Of 11 patients on treatment for at least one post-baseline disease assessment, 7 had a best response of stable disease:
2 of 3 (66%) patients at the 200 mg BID dose (mean duration of 64 days)
5 of 8 (63%) patients assigned or escalated to the 1,200 mg BID dose (mean duration of 115 days)
CA-170 was generally safe and well-tolerated, with low rates of drug-related, immune-related or serious adverse events, and showed dose-proportional clinical PK.
Based on these data, Curis does not intend to enroll additional patients in this study. The Company plans to further evaluate the translational science and clinical pharmacodynamics of CA-170, in addition to patient data from the Phase 1 study, to assess the potential of future clinical studies of CA-170.
The Company is presenting the results from the Phase 1 study at the SITC (Free SITC Whitepaper) 2019 Annual Meeting in National Harbor, Maryland:

Date/Time:

Saturday, November 9, 2019, 4:45 p.m. EST

Location:

Prince George’s Exhibition Hall C

Poster Number:

O28

Title:

First-in-Class Small Molecule CA-170 Targeting VISTA: A Report on Efficacy Outcomes from a Cohort of 12 Malignant Pleural Mesothelioma (MPM) Patients in Study CA-170-101

Corporate:

In August 2019, Curis announced the appointments of Reinhard von Roemeling, M.D., as Senior Vice President, Clinical Development, and Christine Guertin as Vice President, Regulatory Affairs & Quality Assurance.
In September 2019, Curis announced the promotion of Bill Steinkrauss to Chief Financial Officer.
Upcoming 2019 Milestones

The company will be presenting at the 61st American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting held December 7-10, 2019 in Orlando, FL, and will provide an update on:
Initial safety data from the Phase 1 study of the combination of fimepinostat and venetoclax in patients with R/R DLBCL, including patients with DH/DE lymphoma; and
Updated safety and efficacy data from the Phase 1 dose escalation study of CA-4948 in patients with NHL.
Third Quarter 2019 Financial Results

Curis reported a net loss of $6.4 million, or $0.19 per share on both a basic and diluted basis for the third quarter of 2019, as compared to a net loss of $7.2 million, or $0.22 per share on both a basic and diluted basis for the same period in 2018.

Revenues for the third quarter of 2019 were $2.9 million, as compared to $2.8 million for the same period in 2018. Revenues for both periods comprise primarily royalty revenues recorded on Genentech and Roche’s net sales of Erivedge.

Operating expenses were $8.2 million for the third quarter of 2019, as compared to $9.3 million for the same period in 2018, and comprised the following:

Costs of Royalty Revenues. Costs of royalty revenues, primarily amounts due to third-party university patent licensors in connection with Genentech and Roche’s Erivedge net sales, were $0.1 million for the third quarter of 2019, as compared to $0.2 million for the same period in 2018.

Research and Development Expenses (R&D). R&D expenses were $5.1 million for the third quarter of 2019, as compared to $5.0 million for the same period in 2018. The increase was primarily driven by increased costs related to clinical activities for CA-4948.

General and Administrative Expenses (G&A). G&A expenses were $2.9 million for the third quarter of 2019 as compared to $4.1 million for the same period in 2018. The decrease was primarily driven by lower personnel, legal and consulting services during the period.

Other Expenses. Net other expense for the third quarter 2019 was $1.1 million, as compared to $0.8 million for the same period in 2018. Net other expense for the third quarter 2019 primarily consisted of imputed interest expense related to future royalty payments, whereas in 2018 the expense related to interest accrued on Curis Royalty’s debt obligations.

As of September 30, 2019, Curis’s cash, cash equivalents, marketable securities and investments totaled $28.0 million and there were approximately 33.2 million shares of common stock outstanding. Curis expects that its existing cash, cash equivalents and investments should enable it to maintain its planned operations into the second half of 2020.

Conference Call Information

Curis management will host a conference call today, November 5, 2019, at 8:30 a.m. ET, to discuss these financial results, as well as provide a corporate update.

To access the live conference call, please dial 1-888-346-6389 from the United States or 1-412-317-5252 from other locations, shortly before 8:30 a.m. ET. The conference call can also be accessed on the Curis website at www.curis.com in the Investors section.