PDL BioPharma to Exchange Approximately 80% of Convertible Notes Due 2021 and 2024

On December 13, 2019 PDL BioPharma, Inc. ("PDL" or the "Company") (Nasdaq: PDLI) reported that it has entered into separate, privately negotiated exchange agreements pursuant to which it will exchange $119.3 million in aggregate principal amount of its outstanding 2.75% Convertible Senior Notes due in December 2021 (the "2021 Notes") and in December 2024 (the "2024 Notes") for (i) cash in an aggregate amount of $98.0 million, such cash amount to include $139,900 of accrued and unpaid interest on the exchanged notes up to, but excluding, the settlement dates, and (ii) an aggregate of 13.4 million shares of its common stock, par value $0.01 per share ("Common Stock") (Press release, PDL BioPharma, DEC 13, 2019, View Source [SID1234552358]).

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"We believe that the exchange of these notes is an important first step in executing on the strategy announced earlier this week to monetize our assets and return value to our shareholders," said Dominique Monnet, president and CEO of PDL. "Reducing the aggregate $150 million of convertible notes outstanding by approximately 80% will enable us to operate with broader flexibility and on more favorable financial terms by significantly lessening the impact of provisions of the Convertible Note Indentures governing such activities. The privately negotiated exchanges were executed under the note and share repurchase program authorized by our board and announced last Monday."

The 2021 Notes will be exchanged for an aggregate $39.9 million of cash and 3.5 million shares of Common Stock. The 2024 Notes will be exchanged for an aggregate $58.1 million of cash and 9.9 million shares of Common Stock. Upon consummation of the closing, approximately $19.2 million and $11.5 million aggregate principal amount of the 2021 Notes and 2024 Notes, respectively, will remain outstanding.

In connection with the exchange transactions, PDL and Royal Bank of Canada (the "Counterparty" or "RBC") entered into an agreement to terminate a portion of the capped call agreements previously entered into for the 2021 Notes and 2024 Notes in notional amounts corresponding to the amounts of notes exchanged. The Company will receive cash proceeds from the Counterparty of $6.7 million as a result of the partial unwinding of the capped call agreements. The capped call transactions remain in effect for the 2021 Notes and 2024 Notes that remain outstanding.

In connection with the partial unwinding of the capped call agreements, the Company has entered into an agreement with RBC to purchase 3.2 million shares of PDL Common Stock previously acquired by RBC (and or its affiliates) to hedge the capped calls. The Common Stock was acquired by PDL at the closing price of PDL’s Common Stock on December 12, 2019.

The transactions are subject to customary closing conditions and are expected to close on or before Tuesday, December 17, 2019. The shares of Common Stock will be issued in reliance upon the exemption from registration under Section 3(a)(9) of the Securities Act of 1933, as amended.

BofA Securities acted as financial advisor to PDL in connection with the transactions.

Aethlon Medical Announces Pricing of $5 Million Public Offering

On December 13, 2019 Aethlon Medical, Inc. (Nasdaq:AEMD) (the "Company"), a medical device technology company focused on developing products to diagnose and treat life and organ threatening diseases, reported the pricing of an underwritten public offering of 3,333,334 shares of common stock (which includes pre-funded warrants to purchase shares of common stock in lieu thereof), and common warrants to purchase up to an aggregate of 3,333,334 shares of common stock at a public offering price of $1.50 per share (Press release, Aethlon Medical, DEC 13, 2019, View Source [SID1234552375]). Each share of common stock (or pre-funded warrant in lieu thereof) is being sold together with a common warrant to purchase one share of common stock. The common warrants have an exercise price of $1.50 per share, are immediately exercisable, and will expire five years from the date of issuance. The Company has granted the underwriter a 45-day option to purchase up to an additional 499,999 shares of common stock and/or common warrants to purchase up to 499,999 shares of common stock, at the public offering price, less underwriting discounts and commission.

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H.C. Wainwright & Co. is acting as the sole book-running manager for the offering.

The gross proceeds of the offering are expected to be approximately $5 million, prior to deducting underwriting discounts and commissions and estimated offering expenses and excluding the exercise of any common warrants and the underwriter’s option to purchase additional securities. The Company intends to use approximately $700,000 of the net proceeds from this offering for the currently planned clinical trials for the Hemopurifier over the next 12 months, with the remainder for working capital and other general corporate purposes. This offering is expected to close on or about December 17, 2019, subject to customary closing conditions.

A registration statement on Form S-1 (File No. 333-234712) relating to these securities (and the shares of common stock underlying the common warrants and pre-funded warrants) was declared effective by the U.S. Securities and Exchange Commission (the "SEC") on December 12, 2019. This offering is being made only by means of a prospectus forming part of the effective registration statement. A final prospectus relating to and describing the terms of the offering will be filed with the SEC and, when available, may be obtained for free by visiting the SEC’s website at www.sec.gov. Electronic copies of the final prospectus relating to the offering may also be obtain by contacting H.C. Wainwright & Co., LLC, 430 Park Avenue, 3rd Floor, New York, New York 10022, by email at [email protected] or by telephone at 646-975-6996.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or other jurisdiction.

Innate Pharma provides update on lacutamab TELLOMAK trial

On December 13, 2019 Innate Pharma SA (Euronext Paris: IPH – ISIN: FR0010331421; Nasdaq: IPHA) ("Innate" or the "Company") reported an update regarding its TELLOMAK Phase II trial evaluating the efficacy and safety of lacutamab (IPH4102, a potentially first-in-class anti-KIR3DL2 antibody) (Press release, Innate Pharma, DEC 13, 2019, View Source [SID1234552340]). The Company will take the following actions based on ongoing discussions with regulatory authorities regarding a quality issue related to the chemistry, manufacturing and controls (CMC) process:

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Lacutamab will not be administered to new patients in the TELLOMAK trial until additional feedback is received from the respective regulatory agencies overseeing our clinical trial.
Until further notice, the Company will continue to treat patients who are currently enrolled in the multi-center trial, except in Italy where the clinical trial has been suspended due to the feedback from Italian regulatory authorities.
This decision is related to issues with the Company’s manufacturing subcontractor, Rentschler Fill Solutions GmbH or "RFS" (now known as Impletio Wirkstoffabfüllung GmbH). RFS has recently withdrawn the Certificate of Conformity of batches they have produced, including the lacutamab batch currently used in the TELLOMAK trial. RFS was granted a Good Manufacturing Practice (GMP) certificate by the Austrian regulatory agency in August 2018 and further confirmed in October 2019. In parallel, RFS filed for bankruptcy.

The Company’s utmost priority is to ensure patient safety, and no new safety issues have been reported to date in the TELLOMAK trial. An extensive internal and third-party analysis concluded that there was no element that would affect the CMC quality of the product.

Innate will provide an update once it has received additional feedback from the relevant regulatory agencies. In parallel, the Company is working on resolution of the quality issues related to the CMC matter.

Puma Biotechnology Presents Interim Results of Phase II CONTROL Trial of Neratinib in Extended Adjuvant Treatment of HER2-Positive Early Stage Breast Cancer at the 2019 SABCS

On December 13, 2019 Puma Biotechnology, Inc. (Nasdaq: PBYI), a biopharmaceutical company, will present updated interim results from a Phase II clinical trial of Puma’s drug neratinib at the 2019 San Antonio Breast Cancer Symposium (SABCS) that is currently taking place in San Antonio, Texas (Press release, Puma Biotechnology, DEC 13, 2019, View Source [SID1234552359]). The presentation entitled, "Effect of prophylaxis or neratinib dose escalation on neratinib-associated diarrhea and tolerability in patients with HER2-positive early-stage breast cancer: Phase II CONTROL trial," will be displayed at a poster session on December 13 at 5:00 p.m. CST. A full copy of the poster is available on the Puma Biotechnology website.

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Neratinib was approved by the U.S. Food and Drug Administration (FDA) in July 2017 for the extended adjuvant treatment of adult patients with early stage HER2-positive breast cancer following adjuvant trastuzumab-based therapy and is marketed in the United States as NERLYNX (neratinib) tablets.

The main adverse event seen to date in clinical trials of neratinib is diarrhea and, more specifically, grade 3 diarrhea. In the Phase III ExteNET trial of neratinib as extended adjuvant treatment of HER2-positive early stage breast cancer that has previously been treated with adjuvant Herceptin, prophylactic use of anti-diarrheal medications was not mandatory. In the trial, 95.4% of the patients experienced all grade diarrhea and 39.8% of the patients experienced grade 3 or higher diarrhea (there was one event of grade 4 diarrhea). The median cumulative duration of grade 3 diarrhea in the ExteNET trial was 5 days and 16.8% of patients who received neratinib in the ExteNET trial discontinued the drug due to diarrhea.

The CONTROL trial is an international, open-label, Phase II study investigating the use of antidiarrheal prophylaxis or dose escalation in the reduction of neratinib-associated diarrhea that has a primary endpoint of the incidence of grade 3 diarrhea.

In the CONTROL trial, patients with HER2-positive early stage breast cancer who had completed trastuzumab-based adjuvant therapy received neratinib daily for a period of one year. The trial initially tested high dose loperamide prophylaxis given for the first 2 cycles (56 days) of treatment (12 mg on days 1-14, 8 mg on days 15-56 and as needed thereafter). The CONTROL trial was then expanded to include four additional cohorts. One cohort received the combination of loperamide and budesonide, the second cohort received the combination of loperamide plus colestipol, the third cohort received colestipol plus loperamide as needed and the fourth cohort did not use any antidiarrheal drugs as mandatory prophylaxis but instead used a dose escalation during the first month of neratinib treatment. Budesonide is a locally acting corticosteroid that Puma believes targets the inflammation identified in a preclinical model of neratinib-induced diarrhea and colestipol is a bile acid sequestrant that Puma believes targets potential bile acid malabsorption that could result from such inflammation. The dose escalation involved treating with neratinib at 120 mg per day for the first week, 160 mg per week for the second week and 240 mg per week starting at week 3 and until the end of treatment.

The interim analysis of the CONTROL trial presented in the poster included a total of 137 patients who received neratinib plus loperamide prophylaxis, 64 patients who received neratinib plus loperamide prophylaxis for 2 cycles and budesonide for 1 cycle, 136 patients who received neratinib plus loperamide prophylaxis for 1 cycle and colestipol for 1 cycle, 104 patients who received colestipol for 1 cycle and loperamide as needed and 60 patients who received the dose escalation regimen of neratinib.

The results of the trial showed that the incidence of grade 3 diarrhea for the 137 patients who received the loperamide prophylaxis was 31% and that for the 137 patients in this cohort, 20% discontinued neratinib due to diarrhea. The median cumulative duration of grade 3 diarrhea was 3 days.

For the 64 patients who received the combination of loperamide plus budesonide, the results of the trial showed that the incidence of grade 3 diarrhea was 28% and that for the 64 patients in this cohort, 11% discontinued neratinib due to diarrhea. The median cumulative duration of grade 3 diarrhea was 2.5 days.

For the 136 patients who received the combination of loperamide plus colestipol, the results of the trial showed that the incidence of grade 3 diarrhea was 21% and that for the 136 patients in this cohort, 4% discontinued neratinib due to diarrhea. The median cumulative duration of grade 3 diarrhea was 3.5 days.

For the 104 patients who received colestipol and loperamide as needed, the results of the trial showed that the incidence of grade 3 diarrhea was 34% and that for the 104 patients in this cohort, 8% discontinued neratinib due to diarrhea. The median cumulative duration of grade 3 diarrhea was 3 days.

For the 60 patients who received no antidiarrheal drugs as mandatory prophylaxis and dose escalation of neratinib in the first month, the results of the trial showed that the incidence of grade 3 diarrhea was 15% and that for the 60 patients in this cohort, 3% discontinued neratinib due to diarrhea. The median cumulative duration of grade 3 diarrhea was 2 days.

Further information is provided in Table 1 below:

Each patient was counted only once in the highest grade category.

No Grade 4 events reported in the CONTROL study.

Carlos H. Barcenas, MD, MS, Associate Professor in the Department of Breast Medical Oncology of The University of Texas MD Anderson Cancer Center, said, "We are pleased to see the maturation of the data supporting observations of a reduction in incidence, severity and duration of neratinib-associated diarrhea with loperamide prophylaxis, loperamide plus budesonide prophylaxis or the loperamide plus colestipol prophylaxis. Along with the continued reduction in the incidence and severity of grade 3 diarrhea with neratinib, diarrhea appears to be early onset, acute, self-limiting and manageable. Not only does the addition of budesonide or colestipol to loperamide prophylaxis appear to greatly improve the tolerability of neratinib, the dose escalation regimen appears as another promising option since there is no mandatory prophylaxis."

Alan H. Auerbach, Chief Executive Officer and President of Puma Biotechnology, said, "We are pleased to note that the dose-escalation cohort of our CONTROL trial continues to show a marked improvement in the incidence of grade 3 diarrhea and related discontinuation of therapy. We remain committed to improving the tolerability of neratinib in early stage breast cancer patients."

About HER2-Positive Breast Cancer

Approximately 20% to 25% of breast cancer tumors over-express the HER2 protein. HER2-positive breast cancer is often more aggressive than other types of breast cancer, increasing the risk of disease progression and death. Although research has shown that trastuzumab can reduce the risk of early stage HER2-positive breast cancer returning after surgery, up to 25% of patients treated with trastuzumab experience recurrence.

IMPORTANT SAFETY INFORMATION

NERLYNX (neratinib) tablets, for oral use

INDICATIONS AND USAGE: NERLYNX is a kinase inhibitor indicated for the extended adjuvant treatment of adult patients with early-stage HER2 overexpressed/amplified breast cancer, to follow adjuvant trastuzumab-based therapy.

CONTRAINDICATIONS: None

WARNINGS AND PRECAUTIONS:

Diarrhea: Aggressively manage diarrhea occurring despite recommended prophylaxis with additional antidiarrheals, fluids, and electrolytes as clinically indicated. Withhold NERLYNX in patients experiencing severe and/or persistent diarrhea. Permanently discontinue NERLYNX in patients experiencing Grade 4 diarrhea or Grade ≥ 2 diarrhea that occurs after maximal dose reduction.
Hepatotoxicity: Monitor liver function tests monthly for the first 3 months of treatment, then every 3 months while on treatment and as clinically indicated. Withhold NERLYNX in patients experiencing Grade 3 liver abnormalities and permanently discontinue NERLYNX in patients experiencing Grade 4 liver abnormalities.
Embryo-Fetal Toxicity: NERLYNX can cause fetal harm. Advise patients of potential risk to a fetus and to use effective contraception.
ADVERSE REACTIONS: The most common adverse reactions (≥ 5%) were diarrhea, nausea, abdominal pain, fatigue, vomiting, rash, stomatitis, decreased appetite, muscle spasms, dyspepsia, AST or ALT increase, nail disorder, dry skin, abdominal distention, weight decreased and urinary tract infection.

To report SUSPECTED ADVERSE REACTIONS, contact Puma Biotechnology, Inc. at 1-844-NERLYNX (1-844-637-5969) and www.NERLYNX.com or FDA at 1-800-FDA-1088 or www.fda.gov/medwatch.

DRUG INTERACTIONS:

Gastric acid reducing agents: Avoid concomitant use with proton pump inhibitors. When patients require gastric acid reducing agents, use an H2-receptor antagonist or antacid. Separate NERLYNX by at least 3 hours with antacids. Separate NERLYNX by at least 2 hours before or 10 hours after H2-receptor antagonists.
Strong or moderate CYP3A4 inhibitors: Avoid concomitant use.
Strong or moderate CYP3A4 inducers: Avoid concomitant use.
P-glycoprotein (P-gp) substrates: Monitor for adverse reactions of narrow therapeutic agents that are P-gp substrates when used concomitantly with NERLYNX.
USE IN SPECIFIC POPULATIONS:

Lactation: Advise women not to breastfeed.
Please see Full Prescribing Information for additional safety information.

The recommended dose of NERLYNX is 240 mg (six 40 mg tablets) given orally once daily with food, continuously for one year. Antidiarrheal prophylaxis should be initiated with the first dose of NERLYNX and continued during the first 2 months (56 days) of treatment and as needed thereafter.

To help ensure patients have access to NERLYNX, Puma has implemented the Puma Patient Lynx support program to assist patients and healthcare providers with reimbursement support and referrals to resources that can help with financial assistance. More information on the Puma Patient Lynx program can be found at www.NERLYNX.com or 1-855-816-5421.

Susan G. Komen® Study Confirms Treatment Options for HER2-negative Patients With BRCA1/2 Mutations

On December 13, 2019 Susan G. Komen, the world’s leading breast cancer organization, reported the results of the INFORM trial that were announced at the 2019 San Antonio Breast Cancer Symposium (Press release, Susan G Komen, DEC 13, 2019, View Source [SID1234552378]). The Komen-funded INFORM trial led by Dr. Nadine Tung shows that HER2-negative patients with a BRCA1/2 gene mutation have multiple effective treatment options.

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Dr. Tung and colleagues sought to determine if cisplatin chemotherapy is a more effective treatment than the current, standard of care treatment, chemotherapy with doxorubicin and cyclophosphamide (commonly referred to as "AC"). Prior retrospective studies, which looked at treatment that has already occurred as part of the study, had indicated that cisplatin chemotherapy might work better than AC. The INFORM clinical trial was the first prospective study, or a study that evaluates treatment moving forward, to actually test this idea.

"For HER2-negative breast cancer patients with BRCA1/2 mutations, the INFORM trial confirmed that cisplatin chemotherapy is not more effective than standard chemotherapy with doxorubicin and cyclophosphamide. The results suggest that BRCA carriers may respond to both types of chemotherapy – which kill cancer cells by damaging DNA – giving them multiple options to treat their cancer," said Dr. Tung. Prospective studies are essential for improving clinical practice.

She added, "Funding from Susan G. Komen was essential for this work." Funded in part by a Komen Opportunity Grant, the INFORM trial is also part of the Translational Breast Cancer Research Consortium (TBCRC), which has been supported by Komen for more than 10 years.

Victoria Wolodzko, senior vice president of Mission at Susan G. Komen, added, "Patients with BRCA mutations face many challenges, especially those in rural or underserved areas. This work confirms that physicians have more options for these patients. Patients won’t need to wait for a specific treatment to ensure they are getting the best care no matter where they live."