On November 12, 2019 Morphic Therapeutic (NASDAQ: MORF), a biopharmaceutical company developing a new generation of oral integrin therapies for the treatment of serious chronic diseases, reported corporate highlights and financial results for the third quarter of 2019 (Press release, Morphic Therapeutic, NOV 12, 2019, View Source [SID1234551238]).

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"Morphic began the third quarter of 2019 with a successful IPO, providing significant financial resources to fund the discovery and development of our portfolio of small-molecule integrin therapeutics," commented Praveen Tipirneni, M.D., president and chief executive officer of Morphic Therapeutic. "As we look forward, we now believe that we will submit the IND for MORF-720, our oral αvβ6 inhibitor for patients with fibrotic disease being developed in collaboration with AbbVie, in the second half of 2020, based on the request for an additional preclinical study by the FDA. In Morphic’s wholly-owned portfolio, we remain on track to file an IND for our oral inhibitor of α4β7 for patients with inflammatory bowel disease in mid-2020. Further, Morphic continues to refine and apply the MInT platform, a suite of technologies designed to streamline rapid and effective discovery of drug candidates across the entire integrin target class, where we have deep expertise."

Third Quarter Highlights and Program Updates

Oral Integrin Development Program Updates

Oral αvβ6 Inhibition Program for Fibrotic Diseases

Morphic now believes that the IND submission for MORF-720, a selective oral αvβ6-specific integrin inhibitor will take place in the second half of 2020. Morphic has made this adjustment based on the request for an additional preclinical toxicology study received during pre-IND interactions with the FDA. Morphic’s αvβ6 inhibitors remain subject to an exclusive license option pursuant to Morphic’s collaboration agreement with AbbVie.

Oral α4β7 Inhibition Program for Irritable Bowel Disease (IBD)

Morphic remains on track to submit the IND for its wholly owned oral inhibitor of α4β7 for the treatment of IBD in mid-2020 and begin clinical studies in the second half of 2020.

Morphic’s development portfolio is targeted to integrin receptors that are strongly implicated in diseases with validated clinical need. The company’s lead programs are inhibitors of the integrins αvβ6 and α4β7, which Morphic’s data suggests could be the basis of transformational treatments for patients with fibrotic diseases and inflammatory bowel disease (IBD), respectively. Fibrosis is a common feature of many chronic diseases involving tissue injury and can lead to the progressive failure of multiple organs, such as the lungs, liver, skin, and kidney. IBD is a group of chronic autoimmune and inflammatory conditions of the gastrointestinal tract that include ulcerative colitis and Crohn’s disease, among others.

Financial Highlights

Morphic’s initial public offering (IPO) of common stock on The Nasdaq Global Market, including full exercise of the underwriters’ option to purchase additional shares of common stock, closed on July 1, 2019. The IPO generated gross proceeds of approximately $103.5 million, before deducting underwriting discounts and commissions and other estimated offering expenses.

Financial Results for Third Quarter 2019:

Net loss for the quarter ended September 30, 2019 was $8.9 million or $0.30 per share compared to a net loss of $7.1 million or $7.00 per unit (units were converted to shares as a result of converting from a limited liability company to a corporation prior to the IPO), for the same quarter last year).

Revenue was $5.7 million for the quarter ended September 30, 2019 compared to $0 for the same quarter last year. The increase was due to collaboration agreements signed by AbbVie in October 2018 and Janssen in February 2019

Research and development expenses were $12.6 million for the quarter ended September 30, 2019, compared to $5.8 million in the same quarter last year. The $6.8 million increase year-over-year reflects higher development and manufacturing costs associated with our product candidate, MORF-720; research costs associated with preclinical studies; as well as increased personnel-related costs to support continued progress with the company’s pipeline.

General and administrative expenses were $2.9 million for the quarter ended September 30, 2019, compared to $1.4 million in the same quarter last year. The $1.5 million increase year-over-year was primarily attributable to increased headcount and higher professional and consulting fees associated with ongoing business activities and Morphic’s operating as a public company.

As of September 30, 2019, Morphic had cash, cash equivalents, and marketable securities of $251.7 million, compared to $185.9 million as of December 31, 2018. Morphic believes its cash, cash equivalents, and marketable securities as of September 30, 2019, will be sufficient to fund operating expenses and capital expenditure requirements at least through the end of 2022.

On November 12, 2019 NantHealth, Inc. (NASDAQ: NH), a next-generation, evidence-based, personalized healthcare company, reported FDA authorization of Omics Core℠, the first whole exome tumor-normal in vitro diagnostic (IVD) that measures overall tumor mutational burden (TMB) in cancer tissue (Press release, NantHealth, NOV 12, 2019, View Source [SID1234553286]).

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The Omics Core assay is the nation’s first FDA authorized custom-targeted whole exome sequencing platform to report both overall tumor mutation burden in tumor specimens from 19,396 protein-coding genes (whole exome) and somatic alterations (point mutations, small insertions and deletions) in 468 cancer-relevant genes.

TMB is reported via two metrics:

Total number of somatic non-synonymous exonic variants within the 19,396 genes (whole exome) surveyed.
An estimate of mutation rate by counting all somatic, synonymous and non-synonymous variants detected in gene coding regions and dividing by the approximate size of the whole exome.
"Tumor mutation burden (TMB) is now recognized as a key biomarker across multiple tumor types. Studies have shown that immunotherapy treated patients with high TMB had better outcomes compared to those with low TMB. Since the potential for TMB as a precision medicine tool is so high, it is imperative that the most accurate and comprehensive method of analysis be applied to enable physicians to determine which tumors could benefit from checkpoint inhibitors and immunotherapy," said Patrick Soon-Shiong, MD, Chairman & CEO NantHealth. "I am so proud of the scientific, regulatory and bioinformatics teams who have spent almost a decade to perfect this important test that measures the absolute number of mutations occurring in 19,396 protein-coding genes (whole exome) targeting 39 million base pairs (39 Mb) of the human genome from both a tumor and patient-matched normal control sample (tumor-normal). We believe that this comprehensive diagnostic will provide greater accuracy than the widely-used formulaic extrapolation of TMB from a limited gene panel sequence ," said Soon-Shiong.

"Omics Core is the first whole exome test for TMB authorized by the FDA, and as such, marks a watershed moment in oncology. Clinicians can now directly measure the mutations in a patient’s tumor specimen accurately via tumor-normal sequencing and have confidence that the results they receive are fully validated to help support better therapeutic decisions. Also, the breadth of a whole exome means that many more neoepitopes and novel targets may be identified to support vaccine development, novel drug development, and therapies for previously undruggable targets," said Sandeep Bobby Reddy, MD – Chief Medical Officer, NantHealth

"Multiple groups, including our own presentation at ASCO (Free ASCO Whitepaper) in 2018, have shown the importance of performing whole exome sequencing to measure the comprehensive TMB. We calculated a three-fold overestimation of TMB when extrapolating from panel-based methods, potentially leading physicians to over-prescribe checkpoint inhibitors for patients that are unlikely to respond. Given the high cost and the possibility of adverse events with these therapies, it is critical we identify the most appropriate population as accurately as possible," said Steve Benz, PhD – President, Genomics, ImmunityBio.

"Determining the tumor mutational burden from whole exome sequencing is the first step in defining neoepitopes. These unique tumor mutations are recognized by T cells and elicit an immunological anti-tumor response. Patients with high TMB typically have more neoepitopes that attract cancer killing T cells to the tumor microenvironment. Identifying neoepitopes from whole exome TMB enables the development of neoepitope-targeted vaccines for the >95% of protein-encoding genes not covered by limited gene panel tests and the >99% of genes not directly targeted by drugs today. The clearance of Omics Core based upon its analytical performance and validity in reporting TMB establishes a new chapter in the era of precision cancer immunotherapy," said Shahrooz Rabizadeh, PhD – Chief Scientific Officer, ImmunityBio.

About Omics Core

The Omics Core assay is a qualitative in vitro diagnostic test that uses targeted next generation sequencing of formalin-fixed paraffin-embedded tumor tissue matched with normal specimens from patients with solid malignant neoplasms to detect tumor gene alterations in a broad multi gene panel. The test is intended to provide information on somatic mutations (point mutations and small insertions and deletions) and tumor mutational burden (TMB) for use by qualified health care professionals in accordance with professional guidelines, and is not conclusive or prescriptive for labeled use of any specific therapeutic product. Omics Core is a single-site assay performed at NantHealth, Inc. The Omics Core assay is protected by US Patents 9,652,587; 9,646,134; 9,824,181; 10,249,384; 9,721,062; 10,242,155; 10,268,800.

On November 12, 2019 AIVITA Biomedical, Inc., a biotech company specializing in innovative stem cell applications, reported that data from its ongoing Phase 2 clinical trial in GBM was presented at the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) Annual Meeting by Principal Investigator Dr. Daniela Bota (Press release, AIVITA Biomedical, NOV 12, 2019, View Source [SID1234550953]). The oral presentation was titled "Phase II trial of therapeutic vaccine consisting of autologous dendritic cells loaded with autologous tumor cell antigens from self-renewing cancer cells in patients with newly diagnosed glioblastoma."

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Dr. Bota presented interim results from the Phase 2 trial testing AIVITA’s patient-specific immunotherapy AV-GBM-1 in patients with glioblastoma multiforme (GBM). At this time survival is 96% at six months and 91% at twelve months with three patients followed for more than a year. Furthermore, a vast majority of patients displayed an appropriate immune response and a decrease of tumor biomarkers.

AIVITA’s immunotherapy targets tumor-initiating cells. Treatment involves a series of subcutaneous injections. As of the end of October 2019, cell lines had been successfully established for 46/48 patients and dendritic cells produced for 41/42 patients; 38 of the planned 55 patients had been enrolled, 31 had started therapy, and 12 had completed all 8 doses and 184 doses had been injected. Blood tests on the first 16 patients showed induction of a new immune responses that were associated with a decrease in tumor markers.

AIVITA Chief Scientific Officer Gabriel I. Nistor, M.D. acknowledged that the immune response data is highly encouraging. "Once the trial is complete, we’re looking forward to determining the correlation between immune responses and clinical outcome as we previously did in patients with metastatic melanoma treated with a similar patient-specific vaccine," said Dr. Nistor.

"The results are very encouraging," said AIVITA Chief Medical Officer Robert O. Dillman, M.D. "The trial is still in progress and will continue to enroll patients for a few more months with follow up for at least another year. Final analysis likely will occur in early 2021."

CLINICAL TRIAL DETAIL

OVARIAN CANCER

AIVITA’s ovarian Phase 2 double-blind study is active and enrolling approximately 99 patients who are being randomized in a 2:1 ratio to receive either the autologous cancer stem cell-targeting immunotherapy or autologous monocytes as a comparator.

Patients eligible for randomization and treatment will be those (1) who have undergone debulking surgery, (2) for whom a cell line has been established, (3) who have undergone leukapheresis from which sufficient monocytes were obtained, (4) have an ECOG performance grade of 0 or 1 (Karnofsky score of 70-100%), and (5) who have completed primary therapy. The trial is not open to patients with recurrent ovarian cancer.

For additional information about AIVITA’s AVOVA-1 trial patients can visit: www.clinicaltrials.gov/ct2/show/NCT02033616

GLIOBLASTOMA

AIVITA’s glioblastoma Phase 2 single-arm study is active and is enrolling approximately 55 patients to receive the cancer stem cell-targeting immunotherapy.

Patients eligible for treatment will be those (1) who have recovered from surgery such that they are about to begin concurrent chemotherapy and radiation therapy (CT/RT), (2) for whom an autologous tumor cell line has been established, (3) have a Karnofsky Performance Status of > 70 and (4) have undergone successful leukapheresis from which peripheral blood mononuclear cells (PBMC) were obtained that can be used to generate dendritic cells (DC). The trial is not open to patients with recurrent glioblastoma.

For additional information about AIVITA’s AV-GBM-1 trial please visit: www.clinicaltrials.gov/ct2/show/NCT03400917

MELANOMA

AIVITA’s melanoma Phase 1B open-label, single-arm study will establish the safety of administering anti-PD1 monoclonal antibodies in combination with AIVITA’s cancer stem cell-targeting immunotherapy in patients with measurable metastatic melanoma. The study will also track efficacy of the treatment for the estimated 14 to 20 patients. This trial is not yet open for enrollment.

Patients eligible for treatment will be those (1) for whom a cell line has been established, (2) who have undergone leukapheresis from which sufficient monocytes were obtained, (3) have an ECOG performance grade of 0 or 1 (Karnofsky score of 70-100%), (4) who have either never received treatment for metastatic melanoma or were previously treated with enzymatic inhibitors of the BRAF/MEK pathway because of BRAF600E/K mutations and (5) are about to initiate anti-PD1 monotherapy.

For additional information about AIVITA’s AV-MEL-1 trial please visit: www.clinicaltrials.gov/ct2/show/NCT03743298

On November 12, 2019 Sunesis Pharmaceuticals, Inc. (Nasdaq: SNSS) reported financial results for the quarter ended September 30, 2019 (Press release, Sunesis, NOV 12, 2019, View Source [SID1234550972]). Loss from operations for the three and nine months ended September 30, 2019 was $6.0 million and $17.9 million. As of September 30, 2019, the Company had cash and cash equivalents, restricted cash and marketable securities of $38.3 million.

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"We continue to advance our Phase 1b/2 trial of vecabrutinib in patients with B-cell malignancies with the goal of identifying our recommended dose and studying vecabrutinib in defined patient populations in the Phase 2 portion of the study. We are currently in the 400mg cohort as the safety and pharmacokinetic data to date support continued dose escalation," said Dayton Misfeldt, Interim Chief Executive Officer of Sunesis. "As announced last week, we will be presenting a poster at the ASH (Free ASH Whitepaper) Annual Meeting in December that provides an update on the Phase 1b/2 trial of vecabrutinib, and we look forward to sharing the new findings. We also recently presented exciting preclinical pharmacology data for our first-in-class PDK1 inhibitor, SNS-510, at the AACR (Free AACR Whitepaper)-NCI-EORTC conference. The equity offering we completed in July strengthened our cash position and extends our runway through key milestones for the Company."

Recent Highlights

Announced Presentation at ASH (Free ASH Whitepaper) Annual Meeting. In November 2019, the Company announced that a presentation will be made at the 61st American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting to be held December 7-10, 2019 in Orlando, Florida. The abstract, titled "Ongoing Results of a Phase 1B/2 Dose-Escalation and Cohort-Expansion Study of the Selective, Noncovalent, Reversible Burton’s Tyrosine Kinase Inhibitor, Vecabrutinib, in B-Cell Malignancies" (Publication 3041), will be presented on Sunday, December 8, in a session titled "CLL: Therapy, excluding Transplantation: Poster II," from 6:00-8:00pm ET at the Orange County Convention Center, Hall B. The poster will be available on the Sunesis website following the presentation.

Presented Preclinical Data on SNS-510 at the 2019 AACR (Free AACR Whitepaper)-NCI-EORTC AACR-NCI-EORTC (Free AACR-NCI-EORTC Whitepaper) International Conference on Molecular Targets and Cancer Therapeutics (EORTC-NCI-AACR) (Free ASGCT Whitepaper) (Free EORTC-NCI-AACR Whitepaper). In October 2019,

Sunesis presented data profiling the oral PDK1 inhibitor SNS-510 showing potent activity in hematologic and solid tumor cancer models at the 2019 AACR (Free AACR Whitepaper)-NCI-EOTRC AACR-NCI-EORTC (Free AACR-NCI-EORTC Whitepaper) International Conference on Molecular Targets and Cancer Therapeutics (EORTC-NCI-AACR) (Free ASGCT Whitepaper) (Free EORTC-NCI-AACR Whitepaper) in Boston, Massachusetts.

Hired Mehdi Paborji, PhD as VP Technical Operations; promoted Pietro Taverna, PhD to VP Translational Medicine & Nonclinical Development. Dr. Paborji has over 30 years of experience in the industry, including fifteen years at Bristol-Myers Squibb. More recently he served as Chief Operating Officer of Biotie Therapeutics through its sale to Acorda Therapeutics and was also the Founder and COO of Theravida. He has experience leading technical and clinical supply operations, and all aspects of manufacturing of drug substance and drug product. Dr. Paborji has a PhD. in Physical Organic and Bio-Organic Chemistry from the University of Kansas and postdoctoral training in Pharmaceutical Chemistry from the University of Kansas, the School of Pharmacy. Dr. Taverna has over 18 years of experience in the biopharmaceutical industry, exclusively in oncology pharmacology and translational medicine. He returned to Sunesis in 2017 as head of Translational Medicine after nine years at Astex (Otsuka) Pharmaceuticals leading translational medicine programs for their oncology portfolio. Prior to Astex, Dr. Taverna held senior/principal scientist positions at Sunesis and Chiron, overseeing and conducting pharmacology efforts for cancer drug candidates. He has numerous publications as well as presentations at international oncology meetings. Dr. Taverna has a Ph.D. in Pharmacological Research from M. Negri Institute for Pharmacological Research, Milano, Italy and did postdoctoral research at the Institute and at Case Western University.

Appointed Dr. Nicole Onetto to the Board of Directors. In September 2019, Sunesis appointed Dr. Nicole Onetto, M.D. to the Board of Directors, bringing to Sunesis 20 years of clinical development experience in oncology and hematology.

Completion of Public Offering. In July 2019, Sunesis completed underwritten public offerings of shares of its common stock and Series F convertible preferred stock with net proceeds of approximately $26.1 million. The offerings attracted participation from leading biotechnology investors, including existing and new investors.

Financial Highlights

Cash and cash equivalents, restricted cash, and marketable securities totaled $38.3 million as of September 30, 2019, compared to $13.7 million as of December 31, 2018. The increase of $24.6 million was primarily due to $45.1 million in net proceeds from issuance common and preferred stock, and $5.5 million in proceeds from the Silicon Valley Bank Loan Agreement, partially offset by $18.4 million in net cash used in operating activities and $7.5 million principal payment on the Bridge Bank / Solar Capital Loan Agreement and Amendments. This capital is expected to fund the Company through the identification of the Phase 2 dose and initiation of the Phase 2 portion of the ongoing trial.

Research and development expense was $3.5 million and $10.5 million for the three and nine months ended September 30, 2019, compared to $3.6 million and $11.3 million for the same periods in 2018. The decreases between the comparable three and nine month periods were primarily due to a decrease in salary and personnel expenses due to lower headcount and a decrease in clinical expense due to timing, offset by an increase in professional services related to the preparation for the Phase 2 portion of the ongoing clinical trial for vecabrutinib.

General and administrative expense was $2.5 million and $7.5 million for the three and nine months ended September 30, 2019, compared to $2.7 million and $8.9 million for the same periods in 2018. The decreases between the comparable periods were primarily due to a decrease in salary and personnel expenses due to lower headcount and stock-based compensation and a decrease in professional services expenses due to lower legal and vosaroxin patent expenses, offset by an increase in insurance premiums.

Interest expense was $0.1 million and $0.4 million for the three and nine months ended September 30, 2019, compared to $0.3 million and $0.9 million for the same periods in 2018. The decreases in interest expenses from both periods resulted from the lower interest rate paid on a lower principal amount under the SVB Loan Agreement.

Cash used in operating activities was $18.4 million for the nine months ended September 30, 2019, compared to $17.9 million for the same period in 2018. Net cash used in the nine months ended September 30, 2019 resulted primarily from the net loss of $18.0 million and changes in operating assets and liabilities of $1.8 million, offset by adjustments for non-cash items of $1.4 million. Net cash used in 2018 period resulted primarily from the net loss of $20.6 million, partially offset by adjustments for non-cash items of $2.3 million and changes in operating assets and liabilities of $0.4 million.

Sunesis reported loss from operations of $6.0 million and $17.9 million for the three and nine months ended September 30, 2019, compared to $6.3 million and $20.0 million for the same periods in 2018. Net loss was $5.9 million and $18.0 million for the three and nine months ended September 30, 2019, compared to $6.5 million and $20.6 million for the same periods in 2018.

Conference Call Information

Sunesis will host a conference today at 4:30 p.m. Eastern Time. The call can be accessed by dialing (844) 296-7720 (U.S. and Canada) or (574) 990-1148 (International) and entering passcode 4059849. To access the live audio webcast, or the subsequent archived recording, visit the "Investors and Media – Calendar of Events" section of the Sunesis website at www.sunesis.com. The webcast will be recorded and available for replay on the Company’s website for two weeks.

On November 12, 2019 Reata Pharmaceuticals, Inc. (Nasdaq: RETA) ("Reata" or the "Company"), a clinical-stage biopharmaceutical company, reported financial results for the third quarter ended September 30, 2019, and provided an update on the Company’s business and product development programs (Press release, Reata Pharmaceuticals, NOV 12, 2019, View Source [SID1234550988]).

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Recent Company Highlights

Reported positive, topline one-year data from the pivotal CARDINAL study of bardoxolone methyl in patients with chronic kidney disease caused by Alport syndrome
Reported positive topline data from the pivotal MOXIe study of omaveloxolone in patients with Friedreich’s ataxia
Third Quarter Financial Highlights

The Company incurred total expenses of $46.8 million for the quarter ended September 30, 2019, with research and development accounting for $32.3 million. This compares to total expenses of $34.7 million for the same period of the year prior, when research and development accounted for $27.1 million. We reported a net loss of $39.7 million or $1.32 per share for the quarter ended September 30, 2019. This compares to a net loss of $30.8 million or $1.07 per share in the same period of the year prior.

The net loss for the three-month period compared to the year prior is primarily driven by an increase in expenses offset with an increase in revenue. Higher expenses were driven by an increase in research and development expenses due to clinical, manufacturing, and medical affairs activities, and an increase in personnel expenses to support growth of our development activities.

We incurred total expenses of $124.6 million for the nine month period ended September 30, 2019, with research and development accounting for $87.9 million. This compares to total expenses of $97.1 million for the same period of the year prior, when research and development accounted for $72.0 million. We reported a net loss of $103.2 million or $3.44 per share for the nine month period ended September 30, 2019. This compares to a net loss of $55.0 million or $2.03 per share in the same period of the year prior.

The increase in net loss for the nine month period ended September 30, 2019 is driven primarily by both an increase in expenses and a decrease in revenue. Higher expenses were driven by an increase in research and development expenses due to clinical, manufacturing, and medical affairs activities, and an increase in personnel expenses to support growth of our development activities. Revenue to date has primarily been related to license and collaboration agreements entered into during 2009, 2010, and 2011. Additional revenue related to variable consideration that was included in the transaction price under the KKC Agreement was recognized in the prior year period. Since we did not have a similar event in the current period, the revenue decreased by comparison.

Our cash-based operating expenses, a non-GAAP measure, were $41.2 million and $109.9 million for the three and nine months ended September 30, 2019, respectively. This compares to $31.9 million and $89.0 million for the same periods of the year prior. The increase in cash-based operating expenses for the three and nine months ended September 30, 2019, were driven by increased manufacturing and clinical activities, as well as increased personnel costs to support growth in our development activities. We expect our cash-based operating expenses to continue to increase in the future as we advance bardoxolone methyl and omaveloxolone through ongoing and future clinical trials, scale manufacturing for registrational and validation purposes, advance other product candidates into mid- and later-stage clinical trials, expand our product candidate portfolio, increase both our research and development and administrative personnel, and plan for commercialization of our product candidates.

At September 30, 2019, we had $240.1 million in cash and cash equivalents. We expect our current cash, along with our access to additional equity or debt funding, will enable us to meet our current obligations through December 31, 2020.

Non-GAAP Financial Measures

In addition to the U.S. generally accepted accounting principles (GAAP) financial highlights, this earnings release includes cash-based operating expenses, a non-GAAP financial measure, which the Company defines as total expenses excluding stock-based compensation expense and depreciation expense. A reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure is presented in the table below in this earnings release.

We believe that this non-GAAP financial measure, in addition to GAAP financial measures, provides a meaningful measure of our ongoing business and operating performance by allowing investors to analyze our financial results similarly to how management analyzes our financial results by viewing period expense totals more indicative of effort directly expended to advance the business and our product candidates. Non-GAAP financial measures should be considered in addition to, not in isolation or as a substitute for, GAAP financial measures. In addition, our non-GAAP financial measure may differ from similarly named measures used by other companies.

CONFERENCE CALL INFORMATION

Date: November 12, 2019
Time: 8:00 a.m. ET
Audience Dial-in (toll-free): (844) 348-3946
Audience Dial-in (international): (213) 358-0892
Conference ID: 4159656
Webcast Link: View Source