On August 2, 2018 Emergent BioSolutions Inc. (NYSE: EBS) reported financial results for the quarter and six months ended June 30, 2018 (Press release, Emergent BioSolutions, AUG 2, 2018, View Source;p=RssLanding&cat=news&id=2361890 [SID1234528361])

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Q2 2018 AND RECENT BUSINESS ACCOMPLISHMENTS

Completed Mutual Recognition Procedure for market authorization of BioThrax (Anthrax Vaccine Adsorbed) in five Concerned Member States within the European Union – Italy, the Netherlands, Poland, the U.K. and France; to date, BioThrax has received market authorization in four of the five countries.
Initiated an investment of up to $50 million over the next three years in the Camden fill/finish facility located in Baltimore, an expansion project that will significantly enhance the capabilities of this key site within the Company’s CDMO Business Unit.
Announced Framework Partnering Agreement under which the Company will provide technical and manufacturing support for the development and manufacture of a vaccine against Nipah virus in collaboration with Profectus BioSciences, Inc. and CEPI (Coalition for Epidemic Preparedness Innovations); under a separate agreement with Profectus, Emergent will retain the exclusive option to license and assume control of development activities for the Nipah virus vaccine from Profectus.
Initiated a Phase 1 clinical study of ZIKV-IG, the Company’s anti-Zika virus immune globulin being developed as a therapeutic intervention against Zika virus disease; the candidate was granted Fast Track designation by the U.S. Food and Drug Administration in December 2017.
2018 FINANCIAL PERFORMANCE

(I) Quarter Ended June 30, 2018 (Unaudited)

Revenues

Total Revenues

For Q2 2018, total revenues were $220.2 million, an increase of 118% over 2017. Total revenues reflect a significant increase in product sales.

Product Sales

For Q2 2018, product sales were $180.1 million, an increase of 183% as compared to 2017. The increase is principally attributable to sales of BioThrax and ACAM2000, (Smallpox (Vaccinia) Vaccine Live) previously expected in the first quarter as well as continued sales of both products in the second quarter.

Contract Manufacturing

For Q2 2018, revenue from the Company’s contract manufacturing operations was $23.6 million, an increase of 46% as compared to 2017. The increase primarily reflects manufacturing services at the Company’s Canton site.

Contracts and Grants

For Q2 2018, revenue from the Company’s development-based contracts and grants was $16.5 million, a decrease of 21% as compared to 2017. The decrease primarily reflects a reduction in R&D activities related to certain ongoing funded development programs.

Operating Expenses

Cost of Product Sales and Contract Manufacturing

For Q2 2018, cost of product sales and contract manufacturing was $89.2 million, an increase of 158% as compared to 2017. The increase was primarily attributable to the increase in product sales and contract manufacturing activities at the Company’s Bayview and Canton facilities.

Research and Development (Gross and Net)

For Q2 2018, gross R&D expenses were $24.7 million, a decrease of 4% as compared to 2017. The decrease primarily reflects lower costs associated with contract development services.

For Q2 2018, net R&D expense (calculated as gross research and development expenses minus contracts and grants revenue) was $8.2 million, an increase of $3.4 million as compared to 2017, reflecting increased investment in development-stage programs not currently funded in whole or in part by third-party partners. These include costs associated with the Raxibacumab (Anthrax Monoclonal Antibody) technology transfer and the SIAN device, an intranasal antidote spray device for the treatment of known or suspected acute cyanide poisoning.

Selling, General and Administrative

For Q2 2018, selling, general and administrative expenses were $39.5 million, an increase of 24% as compared to 2017, attributable primarily to increased professional services and compensation-related costs.

Income Taxes

For Q2 2018, the provision for income tax expense in the amount of $15.7 million includes a discrete benefit of $0.9 million primarily related to stock compensation activity resulting in an effective tax rate of 24%. Excluding the discrete benefit, the Q2 2018 effective tax rate was 25%.

Net Income & Adjusted Net Income

For Q2 2018, the Company recorded net income of $50.1 million, or $0.98 per diluted share, versus net income of $4.6 million, or $0.11 per diluted share, in 2017. (1).

For Q2 2018, the Company recorded adjusted net income of $54.7 million, or $1.07 per diluted share, versus adjusted net income of $6.6 million, or $0.13 per diluted share, in 2017. (1) (2)

(I) Six Months Ended June 30, 2018 (Unaudited)

Revenues

Total Revenues

For the six months of 2018, total revenues were $338.0 million, an increase of 55% over 2017. Total revenues reflect a significant increase in product sales.

Product Sales

For the six months of 2018, product sales were $255.8 million, an increase of 76% as compared to 2017. The increase is principally attributable to sales of ACAM2000 and Raxibacumab, both of which were acquired in Q4 2017.

Selling, General and Administrative

For the six months of 2018, selling, general and administrative expenses were $79.7 million, an increase of 19% as compared to 2017, attributable primarily to increased professional services and compensation-related costs.

Income Taxes

For the six months of 2018, the provision for income tax expense in the amount of $11.2 million includes a discrete benefit of $3.2 million primarily related to stock compensation activity resulting in an effective tax rate of 20%. Excluding the discrete benefit, the six months of 2018 effective tax rate was 25%.

Net Income & Adjusted Net Income

For the six months of 2018, the Company recorded net income of $45.2 million, or $0.89 per diluted share, versus net income of $15.1 million, or $0.35 per diluted share, in 2017. (1)

For the six months of 2018, the Company recorded adjusted net income of $53.1 million, or $1.04 per diluted share, versus adjusted net income of $20.8 million, or $0.42 per diluted share, in 2017. (1) (2)

2018 FINANCIAL FORECAST & OPERATIONAL GOALS

The Company is reaffirming its full year 2018 financial performance forecast:

Total Revenue
$715 million to $755 million
Pre-Tax Income
$120 million to $140 million
Net Income (3)
$95 million to $110 million
Adjusted Net Income (2) (3)
$110 million to $125 million
EBITDA (2) (3)
$175 million to $190 million
The Company is also reaffirming its full year 2018 operational goals:

Advance NuThrax development to enable Emergency Use Authorization filing with the FDA in 2018
Complete ACAM2000 deliveries; establish a multi-year follow-on contract with the U.S. government
Deliver Raxibacumab doses under current contract; advance technology transfer to the Company’s Bayview facility in Baltimore, Maryland
Progress pipeline to have at least four product candidates in advanced development
Complete an acquisition that generates revenue within 12 months of closing
Q3 2018 FINANCIAL FORECAST

The Company forecast for Q3 2018 total revenue is $165 million to $190 million.

FOOTNOTES

(1) See "Calculation of Diluted Earnings Per Share."
(2) See "Reconciliation of Net Income to Adjusted Net Income and EBITDA" for a definition of terms and a reconciliation table.
(3) Reflects an estimated tax rate that includes the expected effects of the United States Tax Cuts and Jobs Act of 2017 on the Company’s 2018 income tax provision.

CONFERENCE CALL AND WEBCAST INFORMATION

Company management will host a conference call at 5:00 pm (Eastern Time) today, August 2, 2018, to discuss these financial results. This conference call can be accessed live by telephone or through Emergent’s website:

Live Teleconference Information:
Dial in: [US] (855) 766-6521; [International] (262) 912-6157
Conference ID: 93342423
Live Webcast Information:
Visit View Source for the live webcast feed.
A replay of the call can be accessed at www.emergentbiosolutions.com under "Investors."

ABOUT EMERGENT BIOSOLUTIONS INC.

Emergent BioSolutions Inc. is a global life sciences company seeking to protect and enhance life by focusing on providing specialty products for civilian and military populations that address accidental, intentional, and naturally occurring public health threats. Through our work, we envision protecting and enhancing 50 million lives with our products by 2025. Additional information about the company may be found at www.emergentbiosolutions.com. Follow us on Twitter @emergentbiosolu and Instagram @life_at_emergent.

SAFE HARBOR STATEMENT

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements, other than statements of historical fact, including, without limitation, our financial guidance, and any other statements containing the words "will," "believes," "expects," "anticipates," "intends," "plans," "targets," "forecasts," "estimates" and similar expressions in conjunction with, among other things, discussions of the Company’s outlook, financial performance or financial condition, financial and operation goals, strategic goals, growth strategy, acquisition strategy, product sales, government development or procurement contracts or awards, government appropriations, manufacturing capabilities, product development and delivery timeline, and Emergency Use Authorization (EUA) and the timing of other regulatory approvals or expenditures are forward-looking statements. These forward-looking statements are based on our current intentions, beliefs and expectations regarding future events. We cannot guarantee that any forward-looking statement will be accurate. Investors should realize that if underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could differ materially from our expectations. Investors are, therefore, cautioned not to place undue reliance on any forward-looking statement. Any forward-looking statement speaks only as of the date of this press release, and, except as required by law, we do not undertake to update any forward-looking statement to reflect new information, events or circumstances.

There are a number of important factors that could cause the Company’s actual results to differ materially from those indicated by such forward-looking statements, including the availability of funding and the exercise of options under our BioThrax and NuThrax contracts; appropriations for the procurement of our products; our ability to secure EUA pre-authorization approval and licensure of NuThrax from the FDA within the anticipated timeframe, if at all; availability of funding for our U.S. government grants and contracts; our ability to complete expected deliveries of BioThrax, ACAM2000 and Raxibacumab; our ability to establish a multi-year follow-on contract for ACAM2000; our ability to advance the technology transfer of Raxibacumab to the Company’s Bayview facility; our ability to identify and acquire or in-license products or product candidates that satisfy our selection criteria; our ability to successfully integrate and develop the products or product candidates, programs, operations and personnel of any entities, businesses or products that we may acquire; whether anticipated synergies and benefits from an acquisition or in-license will be realized within expected time periods, if at all; our ability to utilize our manufacturing facilities and expand our capabilities; our ability and the ability of our contractors and suppliers to maintain compliance with Current Good Manufacturing Practices and other regulatory obligations; the results of regulatory inspections; the outcome of the class action lawsuit filed against us and possible other future material legal proceedings; the success of our ongoing and planned development programs; the timing and results of clinical trials; the timing of and our ability to obtain and maintain regulatory approvals for our product candidates; and our commercialization, marketing and manufacturing capabilities and strategy. The foregoing sets forth many, but not all, of the factors that could cause actual results to differ from our expectations in any forward-looking statement. Investors should consider this cautionary statement, as well as the risk factors identified in our periodic reports filed with the Securities and Exchange Commission, when evaluating our forward-looking statements.

RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME AND EBITDA

This press release contains two financial measures (Adjusted Net Income and EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization)) that are considered "non-GAAP" financial measures under applicable Securities and Exchange Commission rules and regulations. These non-GAAP financial measures should be considered supplemental to and not a substitute for financial information prepared in accordance with generally accepted accounting principles. The Company’s definition of these non-GAAP measures may differ from similarly titled measures used by others. Adjusted Net Income adjusts for specified items that can be highly variable or difficult to predict, or reflect the non-cash impact of charges resulting from purchase accounting. EBITDA reflects net income excluding the impact of depreciation, amortization, interest expense and provision for income taxes. The Company views these non-GAAP financial measures as a means to facilitate management’s financial and operational decision-making, including evaluation of the Company’s historical operating results and comparison to competitors’ operating results. These non-GAAP financial measures reflect an additional way of viewing aspects of the Company’s operations that, when viewed with GAAP results and the reconciliations to the corresponding GAAP financial measure, may provide a more complete understanding of factors and trends affecting the Company’s business.

The determination of the amounts that are excluded from these non-GAAP financial measures are a matter of management judgment and depend upon, among other factors, the nature of the underlying expense or income amounts. Because non-GAAP financial measures exclude the effect of items that will increase or decrease the Company’s reported results of operations, management strongly encourages investors to review the Company’s consolidated financial statements and publicly filed reports in their entirety.

On August 2, 2018 Karyopharm Therapeutics Inc. (Nasdaq:KPTI), a clinical-stage pharmaceutical company, reported that members of the Company’s management team will participate in the following upcoming investor conferences (Press release, Karyopharm, AUG 2, 2018, View Source [SID1234528380]):

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The Canaccord Genuity 38th Annual Growth Conference on Thursday, August 9, 2018 at 1:00 p.m. ET.

The 2018 Wedbush PacGrow Healthcare Conference on Tuesday, August 14, 2018 at 8:00 a.m. ET.

A live webcast of each of these events will be available on the "Events & Presentations" page in the Investors section of the Company’s website at View Source A replay of each webcast will be archived on the Company’s website for 90 days following the presentation.

On August 2, 2018 Xspray Pharma reported that the first clinical trial material from NerPharMa S.r.l., Xspray’s strategic pharmaceutical manufacturing partner in Milan, has been delivered to the HyNap-Dasa clinical trial, the results of which are expected in Q3 2018 (Press release, Xspray, AUG 2, 2018, View Source [SID1234650103]). HyNap-Dasa is one of three product candidates that Xspray currently has in development. The company’s goal is to launch HyNap-Dasa on the US market in 2021.
Xspray has contracted NerPharMa to produce materials for Xspray’s clinical program and finished products for future commercial sale. The material delivered to the HyNap-Dasa study is the first resulting from this collaboration.

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Xspray is developing HyNap-Dasa both as a fully equivalent version of Sprycel to be registered in the US under an Abbreviated New Drug Application (ANDA), or as an improved product under the 505(b)(2) regulatory procedure. NerPharMa is a pharmaceutical contract manufacturer and subsidiary of Nerviano Medical Sciences S.r.l. of Milan, Italy.

NerPharMa’s GMP manufacturing facility has been approved by the Italian Medicines Agency (AIFA), Italy’s national authority responsible for drug regulation, and the US Food and Drug Administration (FDA).

The clinical HyNap-Dasa trial is a pilot study, testing two formulations in healthy volunteers. Study results are expected in the third quarter and will be the base of the planned pivotal study, scheduled to start in 2019.

"Technology transfer in the pharmaceutical industry is complex, but our partnership with Nerpharma over the past half-year has gone very well, and we were able to deliver clinical trial material according to plan," commented Per Andersson, CEO of Xspray Pharma.

"We’ve now proved that we can deliver GMP materials in an FDA-approved manufacturing facility, both clinical. This is critical, partly for our ongoing clinical program, but first and foremost, for our future commercial sales in the US."

"We’re delighted that the transfer of Xspray’s technology has gone well, and that we now have functional equipment at NerPharMa. I’m convinced that we’ll see more widespread uptake of Xspray’s very useful technology soon," responded Angelo Colombo, CEO of NerPharMa.

On August 2, 2018 Cytori Therapeutics, Inc. (NASDAQ: CYTX) reported that it will provide a live webcast of its second quarter financial results and business update on Tuesday, August 14, 2018 at 5:30 PM Eastern Time (Press release, Cytori Therapeutics, AUG 2, 2018, View Source [SID1234529751]).

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The dial-in information is as follows:
Dial-In Number: +1.877.402.3914
Conference ID: 4075028

Prior to the webcast at approximately 4:30 PM Eastern Time on August 14, Cytori will issue its second quarter earnings release which will review Cytori’s second quarter performance. The webcast will be available both live and by replay two hours after the call in the "Webcasts" section of the company’s investor relations website.

On August 2, 2018 BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) (BioMarin or the Company) reported financial results for the second quarter ended June 30, 2018 (Press release, BioMarin, AUG 2, 2018, View Source [SID1234528316]). The financial results that follow represent a comparison of the second quarter of 2018 to the second quarter of 2017. Total revenues were $372.8 million for the quarter ended June 30, 2018 compared to $317.4 million for the quarter ended June 30, 2017, an increase of 17%. GAAP Net Loss for the quarter ended June 30, 2018 was $16.8 million, or $0.09 loss per basic and diluted share compared to GAAP Net Loss of $36.8 million, or $0.21 loss per basic and diluted share for the quarter ended June 30, 2017.

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Net product sales for the second quarter of 2018 were $367.8 million, compared to $315.9 million in the second quarter of 2017. The increase in net product sales was attributed to the following:

Vimizim: increased by $24.4 million, or 24%, due primarily to an increase in the number of commercial patients;
Brineura: launched in the second quarter of 2017, and contributed $10.6 million to increased net product revenues;
Kuvan: increased $7.0 million, or 7%, driven by an increase in the number of commercial patients;
Naglazyme: increased $5.4 million, or 6%, primarily due to government ordering patterns in certain countries and an increase in the number of commercial patients; and
Aldurazyme: increased $4.1 million, or 21%, primarily as a result of increased volume.
The decrease in GAAP Net Loss was primarily due to the following:

Increased gross profit primarily driven by increased Vimizim, Brineura and Kuvan net product revenues; and
A gain on the sale of intangible assets totaling $20.0 million received from Pfizer Inc. (Pfizer) associated with the achievement of two regulatory milestones, triggered by the U.S. Food and Drug Administration (FDA) acceptance of the New Drug Application submission for talazoparib (which BioMarin sold to Medivation Inc. prior to Pfizer’s acquisition of Medivation Inc.) and the European Medicines Agency acceptance of Pfizer’s submission of a Marketing Authorization Application for talazoparib; partially offset by
Higher research and development (R&D) expense for the expansion of our clinical programs related to tralesinidase alfa (formally referred to as BMN-250), vosoritide and valoctocogene roxaparvovec and higher selling, general and administrative (SG&A) expense in support of the preparation for the commercial launch of Palynziq (formerly known as pegvaliase) and the continued commercial expansion of Brineura.
Non-GAAP Income for the second quarter of 2018 was $19.9 million, compared to Non-GAAP Income of $26.6 million in the second quarter of 2017. The decrease in Non-GAAP income in the second quarter of 2018 is primarily attributed to higher R&D and SG&A expenses, partially offset by increased gross profit from revenues.

As of June 30, 2018, BioMarin had cash, cash equivalents and investments totaling approximately $1.6 billion, as compared to $1.8 billion on December 31, 2017. Our 0.75% senior subordinated convertible notes due 2018 are scheduled to mature in October 2018. Holders have the right to convert their notes at maturity, and with respect to any such conversions we have elected to settle in cash up to the principal amount of the notes, shares of our common stock in respect of conversion value in excess thereof, and cash in lieu of any fractional shares.

Commenting on second quarter results, Jean-Jacques Bienaimé, Chairman and Chief Executive Officer of BioMarin, said, "In the quarter, BioMarin achieved numerous value-creating events on both the commercial and regulatory fronts. On May 24 we received standard FDA approval of Palynziq, an important new therapy that helps address a significant unmet need in adults with phenylketonuria (PKU) who have been unable to control their blood Phe levels with current treatment options. We are very happy with the pace of the initial commercial launch of Palynziq and look forward to providing an update on launch metrics in the third quarter of this year."

"In clinical development, we provided two years of clinical data with the 6e13 vg/kg dose of valoctocogene roxaparvovec gene therapy for severe Hemophilia A from the ongoing Phase 1/2 study in at the World Federation of Hemophilia (WFH) 2018 World Congress in Glasgow, Scotland. The updated data demonstrated the elimination of need for prophylaxis and no spontaneous bleeds in two years. In addition, we amended the protocol for the global GENEr8-1 (Phase 3) pivotal study to evaluate superiority compared to the current standard of care. The number of participants has been increased to 130 and we now anticipate completing enrollment during the first quarter of 2019."

Mr. Bienaimé continued, "With seven commercial products expected to generate approximately $1.5 billion in revenues this year, two potentially $1.0 billion plus late-stage clinical product opportunities, whose pivotal studies are expected to be fully enrolled later this year and in Q1 2019, I believe BioMarin’s commercial prospects have never been better."

All Financial Guidance items are calculated based on US GAAP with the exception of Non-GAAP Income. Refer to Non-GAAP Information beginning on page 9 of this press release for a complete discussion of the Company’s Non-GAAP financial information and reconciliations to the comparable GAAP reported information.

Key Program Highlights

Palynziq for phenylketonuria: On May 24, 2018, the Company announced that it had received standard approval from the FDA for Palynziq, an injection to reduce blood Phe concentrations in adult patients with phenylketonuria, who have uncontrolled blood Phe concentrations greater than 600 micromoles/L on existing management. Palynziq, a PEGylated recombinant phenylalanine ammonia lyase enzyme, is the first approved enzyme substitution therapy to target the underlying cause of PKU by helping the body to break down Phe. In the U.S., Palynziq is only available through a restricted program under a Risk Evaluation and Mitigation Strategy (REMS) called the Palynziq REMS Program. Palynziq is BioMarin’s second approved treatment for this important condition and its seventh commercialized product.

In March 2018, the European Medicines Agency accepted BioMarin’s submission of a Marketing Authorization Application for Palynziq.

Valoctocogene roxaparvovec gene therapy for hemophilia A:
On May 22, the Company provided an update to its previously reported results of an open-label Phase 1/2 study of valoctocogene roxaparvovec, an investigational gene therapy treatment for severe hemophilia A. The updated results were presented during an oral presentation at the WFH 2018 World Congress in Glasgow, Scotland by Dr. John Pasi, M.B., Ch.B., Ph.D., from Barts and The London School of Medicine and Dentistry and primary investigator for this Phase 1/2 study. The data presented at WFH is the most current data (April 16, 2018 cut off) and includes 104 weeks of data for the 6e13 vg/kg cohort and 52 weeks of data for the 4e13 vg/kg cohort.

In the 6e13 vg/kg cohort, the data showed continued and substantial reductions in bleeding requiring Factor VIII infusions with a 97% reduction in mean Annualized Bleed Rate (ABR), with no spontaneous bleeds and elimination of all bleeds in target joints in the second year. 71% and 86% of participants had zero bleeds requiring Factor VIII infusions in years 1 and 2 respectively compared to 14%, who had zero bleeds requiring Factor VIII infusions for a year at baseline. There was a 96% reduction in mean FVIII usage through week 104. Mean Factor VIII activity levels from week 20 through 104 were consistently within the normal or near normal range and no participant was above the upper limit of normal at week 104, expressed as a percentage of normal factor activity in blood. At 104 weeks post-infusion, mean Factor VIII activity level of the 6e13 vg/kg cohort was within the normal range at 59%, and the median was near normal at 46%.

Quality of life as measured by the six-domain Haemo-QoL-A instrument rapidly improved across all domains by up to 17.3 points in mean over baseline through the second year. This is well above the 5.2 point increase considered to be the minimal clinically important difference. The next data update on the Phase 1/2 study with the 6e13 vg/kg cohort is expected to be at the end of year three, in the May 2019 timeframe.

The 4e13 vg/kg cohort also showed a substantial reduction in bleeding requiring Factor VIII infusions with a 92% reduction in ABR. 83% of participants had zero bleeds requiring Factor VIII infusions following treatment for a year compared to 17%, who had zero bleeds requiring Factor VIII infusions for a year at baseline. Mean Factor VIII usage decreased by 98%. Consistent with the reduction in ABR and FVIII usage, quality of life showed mean improvement by 3.8 to 6.3 points.

The global Phase 3 program includes two studies with valoctocogene roxaparvovec, one with the 6e13 vg/kg dose (GENEr8-1) and one with the 4e13 vg/kg dose (GENEr8-2). Enrollment completion in the newly amended GENEr8-1 study is now expected in the first quarter of 2019. GENEr8-2, the ongoing Phase 3 study with the 4e13 vg/kg dose, remains unchanged with an N=40 and is expected to complete enrollment one to two quarters after GENEr8-1 in 2019.

The Company updated the protocol for the GENEr8-1 study evaluating the 6e13 vg/kg dose and has powered the study to evaluate superiority to the current standard of care, Factor VIII prophylaxis. The study will now include 130 participants (an increase of 90 from the original 40).

During the quarter, the Company began a Phase 1/2 study with the 6e13kg/vg dose of valoctocogene roxaparvovec in up to approximately 10 participants with pre-existing AAV5 antibodies. In addition to that study and the ongoing global Phase 3 studies, GENEr8-1 and GENEr8-2, BioMarin has two additional clinical studies underway in its comprehensive gene therapy program for the treatment of severe hemophilia A. One to study seroprevalence in people with severe hemophilia A and one non-interventional study to determine baseline characteristics in people with hemophilia A, are ongoing around the world. Also, participants in the Phase 1/2 dose escalation study updated in the quarter at WFH will continue to be monitored as part of the global program underway.

Vosoritide for achondroplasia: On May 11, 2018, the FDA held an advisory committee meeting to discuss drug development for the treatment of children with achondroplasia, the most common form of disproportionate short stature in humans. It was a joint meeting of the Pediatric Advisory Committee and Endocrinologic and Metabolic Drugs Advisory Committee. The committees agreed that annualized growth velocity is the appropriate primary endpoint to use in clinical trials for the treatment of achondroplasia. The committees also expressed support for evaluating secondary endpoints in drug development for achondroplasia including, quality of life, and effects on sleep apnea, hearing loss, and ear infection.

BioMarin’s Phase 3 product candidate, vosoritide, an analog of C-type natriuretic peptide (CNP), is being studied in children with achondroplasia. Vosoritide has demonstrated sustained increase in average growth velocity over 30 months of treatment in 10 children, who completed 30 months of daily dosing at 15 µg/kg/day. Over this period of time, patients experienced a mean cumulative height increase of approximately 4 cm over what their baseline growth velocity would have predicted.

The Company’s multi-pronged program was developed to demonstrate the ability to improve clinical outcomes in children with achondroplasia. The program includes four distinct areas of focus to support global approval. Currently enrolling, the global Phase 3 study is a randomized, placebo-controlled study of vosoritide in approximately 110 children with achondroplasia ages 5-14 for 52 weeks. The study will be followed by a subsequent open-label extension. Children in this study will have completed a minimum six-month baseline study to determine their respective baseline growth velocity prior to entering the Phase 3 study. The baseline study is fully enrolled and the Company expects to complete enrollment of the Phase 3 study in September or October of this year. In addition, the Company expects to have over 5 years of clinical data from the long-term, open-label Phase 2 program to corroborate maintenance of effect.

Given the importance of early intervention in this indication, on June 14, 2018, the Company began an infant/toddler study in 0 to 5 year-old children and dosed the first participant in the global Phase 2 study. Finally, the Company has undertaken a Natural History program to augment clinical understanding of outcomes of untreated patients for comparison to treated patients.
Other Ongoing Clinical Development Programs:

Tralesinidase alfa (formerly referred to as BMN 250) for MPS IIIB (Sanfilippo Syndrome, Type B): Earlier in the year, at the WORLDSymposium 2018, the Company updated preliminary results from the Phase 1/2 trial with tralesinidase alfa, an investigational enzyme replacement therapy using a novel fusion of recombinant human alpha-N-acetylglucosaminidase (NAGLU) with a peptide derived from insulin-like growth factor 2 (IGF2) for the treatment of Sanfilippo B syndrome or mucopolysaccharidosis IIIB (MPS IIIB). These data suggest that tralesinidase alfa, which is administered via intracerebroventricular (ICV) infusion, reaches the peripheral circulation and has activity in somatic organs. Development Quotient (DQ), a measure of cognitive function normalized to age, was also monitored. Preliminary data suggest stabilization of cognitive DQ at the high dose of tralesinidase alfa in some subjects. Patients with untreated Sanfilippo B syndrome usually show progressive decline in DQ.

BMN 290 for Friedreich’s Ataxia: In late 2017, BioMarin announced that it had selected as its next clinical drug development candidate, BMN 290, a selective chromatin modulation therapy intended for treatment of Friedreich’s ataxia. Friedreich’s ataxia is a rare autosomal recessive disorder that results in disabling neurologic and cardiac progressive decline associated with a deficiency in frataxin. Prior to the lead compound being acquired by BioMarin from Repligen Corporation (Repligen), it demonstrated increases in frataxin in Friedreich’s ataxia patients. In preclinical models conducted by BioMarin, BMN 290, a compound derived from the original Repligen compound, increases frataxin message expression in brain and cardiac tissues more than two-fold. Currently, there are no approved disease modifying therapies for Friedreich’s ataxia. The Company expects to complete IND-enabling evaluations with a view to submitting an IND application for BMN 290 during the second half of 2018.

Gene therapy product candidate for phenylketonuria (PKU): In April 2018, the Company announced that it expects to submit an investigational new drug (IND) application for a gene therapy product for the treatment of PKU in 2019 (after BMN 290 for Friedreich’s ataxia). PKU is an autosomal recessive disorder in which phenylalanine hydroxylase, the enzyme that metabolizes the amino acid phenylalanine (Phe), is deficient. PKU leads to high levels of neurotoxic phenylalanine, which affects neurocognitive development and function, if left untreated. In preclinical models, BioMarin’s PKU gene therapy product candidate demonstrated sustained, normalized Phe levels in an ongoing study and out to 60 weeks at the last observation. The product candidate will be an AAV vector containing the DNA sequence that codes for the phenylalanine hydroxylase enzyme that is deficient in people with PKU.
BioMarin will host a conference call and webcast to discuss second quarter 2018 financial results today, Thursday, August 2, 2018 at 4:30 p.m. ET. This event can be accessed on the investor section of the BioMarin website at www.biomarin.com.