On November 6, 2019 Trillium Therapeutics Inc. (NASDAQ/TSX: TRIL), a clinical stage immuno-oncology company developing innovative therapies for the treatment of cancer, reported that new preclinical data from its STING agonist program will be presented at the 34th annual meeting of the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) (Press release, Trillium Therapeutics, NOV 6, 2019, View Source [SID1234550409]). The meeting will be held November 6-10 in National Harbor, MD. The poster presentation will highlight the anti-tumor activity of TTI-10001, a novel small molecule STING agonist, when delivered intravenously or orally. Details of the presentation are listed below.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Title: "TTI-10001, a next generation small molecule STING agonist, demonstrates potent anti-tumor activity in mice following intravenous or oral administration"

Presenter: Bob Uger, Ph.D., Chief Scientific Officer, Trillium Therapeutics Inc.

Date and Time: November 9, 2019 from 8:00 a.m. – 8:30 p.m. ET

Location: Gaylord National Hotel & Convention Center

Abstract Number: P668

On November 6, 2019 Atara Biotherapeutics, Inc. (Nasdaq: ATRA), a leading off-the-shelf, allogeneic T-cell immunotherapy company developing novel treatments for patients with cancer, autoimmune and viral diseases, reported that it will present long-term tab-cel (tabelecleucel) clinical outcomes from a multicenter Expanded Access Protocol (EAP) study for patients with Epstein-Barr virus-associated post-transplant lymphoproliferative disease (EBV+ PTLD) (Press release, Atara Biotherapeutics, NOV 6, 2019, View Source [SID1234550441]). These results, along with findings described in three additional abstracts, will be presented at the 61stAmerican Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting & Exposition, to be held December 7-10, 2019, in Orlando, Florida.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"I am pleased with the tab-cel long-term clinical outcomes for patients with EBV+ PTLD we continue to observe in our EAP study," said Pascal Touchon, President and Chief Executive Officer of Atara Biotherapeutics. "The well-tolerated safety profile, high response rate and durable 2-year survival data are consistent with our previous tab‑cel clinical experience and reinforces our confidence in tab-cel as a potentially transformative off-the-shelf, allogeneic T-cell immunotherapy for this often-deadly ultra-rare cancer."

Twenty-six EBV+ PTLD patients who failed prior rituximab treatment regimens were enrolled in a tab‑cel EAP study (EAP-201) as of June 2018, after which EAP-201 was amended to focus on expanded access for patients with EBV+ PTLD and other EBV+ diseases who are not eligible for Atara’s ongoing tab‑cel Phase 3 studies (EAP-901, NCT02822495). The findings presented here are as of June 3, 2019. Consistent with prior studies, no tab-cel related adverse events leading to discontinuation or death occurred.

A subgroup of 22 EAP-201 EBV+ PTLD patients with adequate ECOG performance status, no CNS disease and no PTLD-related ventilatory support, would have likely met the eligibility criteria for Atara’s ongoing tab‑cel Phase 3 studies.

The overall response rate (ORR) for patients in this EAP-201 subgroup with EBV+ PTLD following HCT (n=11) and SOT (n=11) was 55 and 82 percent with an estimated two-year overall survival of 79 and 81 percent, respectively.

For all EBV+ PTLD patients enrolled in EAP-201, the ORR was 50 and 83 percent for HCT (n=14) and SOT (n=12), respectively.

Atara will also present additional findings describing the hospitalization burden of patients with EBV+ PTLD following SOT who failed first-line rituximab or rituximab plus chemotherapy.

In addition, Atara’s Moffitt Cancer Center collaborators will present two abstracts detailing next-generation CAR T technologies, licensed exclusively to Atara, and designed to enhance persistence while reducing susceptibility to exhaustion and suppressive immune microenvironments.

Details of the ASH (Free ASH Whitepaper) presentations and abstracts are as follows:

Abstract 4071: Long-Term Outcomes of Subjects with Epstein-Barr Virus-Driven Post-Transplant Lymphoproliferative Disorder (EBV+PTLD) Following Solid Organ (SOT) or Allogeneic Hematopoietic Cell Transplants (HCT) Treated with Tabelecleucel on an Expanded Access Program
Poster Presentation Date and Time: Monday, December 9, 6:00 – 8:00 p.m. EST
Session Title: 626. Aggressive Lymphoma (Diffuse Large B-Cell and Other Aggressive B-Cell Non-Hodgkin Lymphoma) – Results from Prospective Clinical Trials: Poster III
Location: Orange County Convention Center, Hall B
Authors: Susan Prockop, M.D.1, Ran Reshef, M.D.2, Donald E. Tsai, M.D., Ph.D.3, Nancy Bunin, M.D.4, Rolla Abu-Arja, M.D.5, Kris Michael Mahadeo, M.D.6, Wen-Kai Weng, M.D., Ph.D.7, Koen Van Besien, M.D., Ph.D.8, David Loeb, M.D., Ph.D.9, Sunita Dwivedy Nasta, M.D.10, Eneida R. Nemecek, M.D., M.B.A., M.S.11, Minoti Hiremath, MBBS, Ph.D.12, Susan Yue, M.D.13, Yan Sun, Ph.D.13, Willis H Navarro, M.D.12 and Sarah Nikiforow, M.D., Ph.D.14
Affiliations: 1Memorial Sloan Kettering Cancer Center, New York, NY; 2Columbia University Irving Medical Center, New York, NY; 3Loxo Oncology, Stamford, CT; 4Children’s Hospital of Philadelphia, Philadelphia, PA; 5Nationwide Children’s Hospital, Columbus, OH; 6MD Anderson Cancer Center, Houston, TX; 7Division of Blood and Marrow Transplantation, Department of Medicine, Stanford Univ. School of Med., Stanford, CA; 8Division of Hematology and Oncology, Weill Cornell Medical College, New York, NY; 9Montefiore, Bronx, NY; 10University of Pennsylvania, Philadelphia; 11Pediatric Hematology/Oncology & Bone Marrow Transplantation, OHSU Knight Cancer Institute Doernbecher Children’s Hospital, Portland, OR; 12Atara Biotherapeutics, South San Francisco, CA; 13Atara Biotherapeutics, Thousand Oaks, CA; 14Dana-Farber Cancer Institute, Boston, MA

Abstract 65: Burden of Hospitalizations Due to Epstein-Barr Virus-Driven Post-Transplant Lymphoproliferative Disorder (EBV+ PTLD) in Patients Who Failed First Line Rituximab or Rituximab Plus Chemotherapy Following Solid Organ Transplant (Post-SOT): A Retrospective Chart Review Study of German PTLD Registry
Oral Presentation Date and Time: Saturday, December 7, 8:30 a.m. EST
Session Title: 902. Health Services Research – Malignant Conditions (Lymphoid Disease): Health Care Utilization and Quality of Life
Location: Orange County Convention Center, W308
Authors: Heiner Zimmermann, M.D.1, Hairong Xu, M.D., Ph.D.2, Arie Barlev, Pharm.D.3, Yang Zhang, Ph.D.2, Dhanalakshmi Thirumalai2, Crystal Watson, M.S.3 and Ralf Ulrich Trappe, M.D.1
Affiliations: 1Internal Medicine II: Hematology and Oncology, Diako Hospital, Bremen, Germany; 2Atara Biotherapeutics, Inc, Thousand Oaks, CA; 3Atara Biotherapeutics, Inc, South San Francisco, CA
Summary: Approximately one-half of PTLD patients treated with rituximab, currently first-line therapy for PTLD, are relapsed or refractory to treatment. This review of the German PTLD registry database showed a substantial hospitalization burden for patients failing rituximab treatment, accounting for approximately 20% of patients’ hospitalization time after initial PTLD diagnosis with approximately 10% of the time spent in the ICU.

Abstract 5826: The Economic Burden of Short-Term Adverse Events Associated with the CHOP Chemotherapy Regimen in Patients with Lymphoproliferative Disorders in the United States; A Comprehensive Literature Review
Presentation Date and Time: N/A; will appear in the November supplemental online-only issue of Blood
Authors: Crystal Watson, M.S. 1, Arie Barlev, Pharm.D. 1, Jodie Worrall1, Steve Duff, M.S.3, Rachel Beckerman, Ph.D.2
Affiliations: 1Atara Biotherapeutics, Inc, South San Francisco, CA; 2Maple Health Group, New York, NY; 3Veritas Health Economic Consulting, Carlsbad, CA

Abstract 867: Mutation of the CD28 Costimulatory Domain Confers Enhanced CAR T Cell Function
Oral Presentation Date and Time: Monday, December 9, 5:00 p.m. EST
Session Title: 703. Adoptive Immunotherapy: Mechanisms and New Approaches: New Approaches
Location: Orange County Convention Center, W224ABEF
Authors: Justin C Boucher1, Gongbo Li1, Hiroshi Kotani1, Maria L Cabral2, Dylan Morrissey3, Sae Bom Lee1,4, Kristen Spitler1, Nolan Beatty1,4, Bishwas Shrestha1, Bin Yu1, Aslamuzzaman Kazi5, Xuefeng Wang6, Said M Sebti5, Marco L Davila1,3
Affiliations: 1Department of Blood & Marrow Transplant and Cellular Immunotherapy, Division of Clinical Science, H. Lee Moffitt Cancer Center, Tampa, FL; 2Department of Cell Biology, Microbiology, and Molecular Biology, College of Arts and Sciences, University of South Florida, Tampa, FL; 3Morsani College of Medicine, University of South Florida Health, Tampa, FL; 4Cancer Biology PhD Program, University of South Florida, Tampa, FL; 5Drug Discovery Program, H. Lee Moffitt Cancer Center, Tampa, FL; 6Department of Biostatistics and Bioinformatics, H. Lee Moffitt Cancer Center, Tampa, FL
Summary: Current generation Chimeric antigen receptors (CARs) utilizing CD28 co-stimulatory domains have been reported to drive high levels of T cell activation that also lead to exhaustion and shortened persistence. Three signaling subdomains present on CD28 differentially regulate this drive towards exhaustion. Using a combination of in vitro and in vivo genomic studies, this study demonstrates CAR T cells using a modified version of CD28, with tailored signaling driven through the PYAP (mut06) subdomain, optimizes CAR T cell signaling by lowering transcription factors that drive exhaustion.

Abstract 4438: MDSC Suppression of CAR T cell can be Reduced by Targeted Signaling Disruption
Poster Presentation Date and Time: Monday, December 9, 6:00 – 8:00 p.m. EST
Session Title: 703. Adoptive Immunotherapy: Mechanisms and New Approaches: Poster III
Location: Orange County Convention Center, Hall B
Authors: Estelle V Cervantes1, Justin C Boucher2, Sae Bom Lee2,3, Kristen Spitler2, Kayla Reid2, Marco L Davila1,2
Affiliations: 1Morsani College of Medicine, University of South Florida, Tampa, FL, 33612; 2Department of Blood & Marrow Transplant and Cellular Immunotherapy, Division of Clinical Science, H. Lee Moffitt Cancer Center, Tampa, FL, 33612; 3Cancer Biology PhD Program, University of South Tampa, Tampa, FL, 33612
Summary: CAR T persistence is one of the challenges faced by CAR T cell therapy. Myeloid derived suppressor cells (MDSCs) function as key contributors to preventing persistence of CAR T cells. Data from this study show MDSCs can suppress CAR T cell function when present in vitro, including during CAR T production, as demonstrated by reductions in CAR T cell activation and cytotoxicity. CAR T cells expressing an optimized CD28 co-stimulatory domain (mut06) were less susceptible to the suppressive effects of MDSCs in vitro and in vivo. These data support that mut06 CARs may improve activity and persistence in the presence of MDSCs and may also improve CAR T production in vitro by overcoming the effects of MDSCs.

On November 6, 2019 Emergent BioSolutions Inc. (NYSE: EBS) reported financial results for the third quarter and nine months ended September 30, 2019 (Press release, Emergent BioSolutions, NOV 6, 2019, View Source [SID1234550458]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Q3 2019 AND RECENT BUSINESS ACCOMPLISHMENTS

Procurement

Announced the contract award by the Office of the Assistant Secretary for Preparedness and Response (ASPR) in the U.S. Department of Health and Human Services (HHS) valued at approximately $2 billion over 10 years for the continued supply of ACAM2000, (Smallpox (Vaccinia) Vaccine, Live) into the U.S. Strategic National Stockpile (SNS) in support of smallpox preparedness.

Announced the exercise by the Biomedical Advanced Research and Development Authority (BARDA) of the first contract option, valued at $261 million, to procure doses of the next generation anthrax vaccine candidate AV7909 (anthrax vaccine adsorbed with adjuvant) for delivery into the SNS over 12 months.

Awarded a contract by the ASPR in HHS valued at up to $490 million over 10 years ($90 million agreed to now and the remaining $400 million to be negotiated and finalized over the next 6 months) for the continued

1 of 15

a050221194qcy2018fina_image1.gif

supply of BAT [Botulism Antitoxin Heptavalent (A, B, C, D, E, F, G) – (Equine)] into the SNS in support of botulism preparedness and response capability.

Product Development

Granted PRIority MEdicines, or PRIME, designation by the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) for the company’s chikungunya virus (CHIKV) virus-like particle (VLP) vaccine candidate, CHIKV VLP.

Awarded a research grant by the National Institute on Drug Abuse (NIDA), a component of the National Institutes of Health (NIH), in HHS, valued at approximately $6.3 million over two years, for the continued development of AP007, the company’s sustained-release nalmefene formulation for the treatment of opioid use disorder (OUD).

Awarded approximately $20 million to develop and manufacture an auto-injector containing diazepam (5 mg/mL) to treat nerve agent-induced seizures. Emergent’s device is being designed for intramuscular buddy-administration for use in military environments and for civilian emergencies.

2019 FINANCIAL PERFORMANCE (unaudited)

(I) Quarter Ended September 30, 2019 (Q3)

Revenues

Total Revenues
For Q3 2019, total revenues were $311.8 million, an increase of 80% over 2018. Total revenues reflect the contribution of recently acquired products as well as increased contracts and grants revenue.
Product Sales
For Q3 2019, product sales were $256.2 million, an increase of $122.9 million or 92% as compared to 2018. The increase primarily reflects sales of both NARCAN (naloxone HCl) Nasal Spray, which was acquired in October 2018, and increased sales of ACAM2000, (Smallpox (Vaccinia) Vaccine, Live), offset by decreased sales of Anthrax vaccines (BioThrax (Anthrax Vaccine Adsorbed) and AV7909) and other product sales.
(in millions)
Three Months Ended September 30,

Contract Manufacturing
For Q3 2019, revenue from the Company’s contract manufacturing operations was $20.0 million, a decrease of $2.1 million or 10% as compared to 2018. The decrease primarily reflects contracted service work in Q3 2018 that did not recur in Q3 2019.

a050221194qcy2018fina_image1.gif

Contracts and Grants
For Q3 2019, revenue from the Company’s development-based contracts and grants was $35.6 million, an increase of $17.4 million as compared to 2018. The increase primarily reflects increased R&D activities related to certain ongoing funded development programs, most notably AV7909.

Operating Expenses

Cost of Product Sales and Contract Manufacturing
For Q3 2019, cost of product sales and contract manufacturing was $108.0 million, an increase of $38.7 million or 56% as compared to 2018. The increase is attributable to the increase in product sales.

Research and Development (Gross and Net)

For Q3 2019, gross R&D expenses were $53.4 million, an increase of $16.4 million or 44% as compared to 2018. The increase primarily reflects costs associated with incremental development programs from the recent acquisitions of PaxVax and Adapt Pharma in October 2018, as well as timing of manufacturing development activities related to the AV7909 program.

For Q3 2019, net R&D expense, which reflects investments made in development programs that are not currently funded in whole or in part by third-party partners and is calculated as gross research and development expenses minus contracts and grants revenue, was $17.8 million, a decrease of $1.0 million or 5% as compared to 2018. The decrease primarily reflects a reduction in raxibacumab technology transfer costs, partially offset by increases related to the development of the CHIKVVLP vaccine and various programs related to opioid overdose response. The Q3 2019 net R&D expense was 6% of adjusted revenue (total revenue less contracts & grants) compared to 12% of adjusted revenue in Q3 2018.

Selling, General and Administrative

For Q3 2019, selling, general and administrative expenses were $65.0 million, an increase of $22.9 million or 54% as compared to 2018. The increase primarily reflects the addition of the operations and integration costs associated with the PaxVax and Adapt Pharma acquisitions.

Amortization of Intangible Assets

For Q3 2019, amortization of intangible assets was $14.7 million versus $3.9 million as compared to 2018. The increase entirely reflects higher non-cash intangible asset amortization costs associated with the PaxVax and Adapt Pharma acquisitions.

3 of 15

a050221194qcy2018fina_image1.gif

Income Taxes

For Q3 2019, the income taxes expense in the amount of $15.7 million includes the impact of permanent items.

Net Income & Adjusted Net Income

For Q3 2019, the Company recorded net income of $43.2 million, or $0.83 per diluted share, versus net income of $20.9 million, or $0.41 per diluted share, in 2018.

For Q3 2019, the Company recorded adjusted net income of $63.3 million, or $1.21 per diluted share, versus adjusted net income of $28.4 million, or $0.55 per diluted share, in 2018. (1)

EBITDA & Adjusted EBITDA

For Q3 2019, the Company recorded EBITDA of $96.3 million versus $33.7 million in 2018. (1)

For Q3 2019, the Company recorded adjusted EBITDA of $106.4 million versus $39.1 million in 2018. (1)

(II) Nine months ended September 30, 2019 (unaudited)

Revenues

Total Revenues
For the nine months ended September 30, 2019, total revenues were $745.7 million, an increase of 46% over 2018. Total revenues reflect the contribution of recently acquired products as well as increased contracts and grants revenue.

Product Sales
For the nine months ended September 30, 2019, product sales were $592.7 million, an increase of $203.6 million or 52% as compared to 2018. The increase primarily reflects sales of NARCAN Nasal Spray, which was acquired in October 2018, and ACAM2000, offset by decreased sales of Anthrax vaccines (BioThrax and AV7909).
(in millions)
Nine Months Ended September 30,

Contract Manufacturing
For the nine months ended September 30, 2019, revenue from the Company’s contract manufacturing operations was $54.6 million, a decrease of $17.4 million or 24% as compared to 2018. The decrease primarily reflects contracted service work in the nine months of 2018 that did not recur in the nine months of 2019.

a050221194qcy2018fina_image1.gif

Contracts and Grants
For the nine months ended September 30, 2019, revenue from the Company’s development-based contracts and grants was $98.4 million, an increase of $47.8 million or 94% as compared to 2018. The increase primarily reflects increased R&D activities related to certain ongoing funded development programs, most notably AV7909.

Operating Expenses

Cost of Product Sales and Contract Manufacturing
For the nine months ended September 30, 2019, cost of product sales and contract manufacturing was $300.7 million, an increase of $91.9 million or 44% as compared to 2018. The increase is attributable to the increase in product sales.

Research and Development (Gross and Net)
For the nine months ended September 30, 2019, gross R&D expenses were $163.4 million, an increase of $72.6 million compared to 2018. The increase primarily reflects costs associated with incremental development programs from the recent acquisitions of PaxVax and Adapt Pharma in October 2018, as well as timing of manufacturing development activities related to the AV7909 program.

For the nine months ended September 30, 2019, net R&D expense, which reflects investments made in development programs that are not currently funded in whole or in part by third-party partners and is calculated as gross research and development expenses minus contracts and grants revenue, was $65.0 million, an increase of $24.8 million or 62% as compared to 2018. The increase primarily reflects investments in the development of the CHIKV-VLP vaccine and various programs related to opioid overdose response. The nine months of 2019 net R&D expense was 10% of adjusted revenue (total revenue less contracts & grants) compared to 9% of adjusted revenue in the nine months of 2018.

Selling, General and Administrative
For the nine months ended September 30, 2019, selling, general and administrative expenses were $201.3 million, an increase of $79.5 million or 65% as compared to 2018. The increase primarily reflects the addition of the operations and integration costs associated with the PaxVax and Adapt Pharma acquisitions.

Amortization of Intangible Assets
For the nine months ended September 30, 2019, amortization of intangible assets was $43.9 million versus $11.7 million as compared to 2018. The increase entirely reflects higher non-cash intangible asset amortization costs associated with the PaxVax and Adapt Pharma acquisitions.

a050221194qcy2018fina_image1.gif

Income Taxes
For the nine months ended September 30, 2019, income tax benefit was $1.7 million, which includes the impact of permanent items.

Net Income & Adjusted Net Income
For the nine months ended September 30, 2019, the Company recorded net income of $7.6 million, or $0.15 per diluted share, versus net income of $66.2 million, or $1.29 per diluted share, in 2018.

For the nine months ended September 30, 2019, the Company recorded adjusted net income of $67.0 million, or $1.28 per diluted share, versus adjusted net income of $83.3 million, or $1.63 per diluted share, in 2018. (1)

EBITDA & Adjusted EBITDA
For the nine months ended September 30, 2019, the Company recorded EBITDA of $116.3 million versus $115.5 million in 2018. (1)

For the nine months ended September 30, 2019, the Company recorded adjusted EBITDA of $145.4 million versus $124.6 million in 2018. (1)

2019 FINANCIAL FORECAST (Reaffirmed)

* Reflects revision from previous guidance ($255-$285) due to the inclusion of changes in fair value of contingent consideration as an additional item for reconciliation in the calculation of Adjusted EBITDA; management has determined Adjusted EBITDA is more reflective of the Company’s true operations than EBITDA alone and the guidance range for EBITDA has been revised based on current expectations.

The Company’s financial forecast for 2019 includes the anticipated impact of full year product sales, continued contract manufacturing and contracts & grants revenue as well as continued investment in internally funded development projects. The outlook for 2019 does not include estimates for potential new corporate development or other M&A transactions.

FOOTNOTES

(1) See "Reconciliation of Net Income to Adjusted Net Income, EBITDA and Adjusted EBITDA" for a definition of terms and a reconciliation table.

CONFERENCE CALL AND WEBCAST INFORMATION
Company management will host a conference call at 5:00 pm (Eastern Time) today, November 6, 2019, to discuss these financial results. This conference call can be accessed live by telephone or through the Company’s website.

a050221194qcy2018fina_image1.gif

Live Teleconference Information:
Dial in: [US] (855) 766-6521; [International] (262) 912-6157
Conference ID: 1169597

Live Webcast Information:
Visit View Source for the live webcast.

On November 6, 2019 Kezar Life Sciences, Inc. (Nasdaq: KZR), a clinical-stage biotechnology company discovering and developing novel small molecule therapeutics to treat unmet needs in autoimmunity and cancer, reported its third quarter 2019 financial results and corporate highlights (Press release, Kezar Life Sciences, NOV 6, 2019, View Source [SID1234550475]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"I commend our team’s continued execution across our clinical and preclinical programs here at Kezar. Our three Phase 2 trials with KZR-616 in severe autoimmune diseases are progressing on track, and we look forward to disclosing additional data from our MISSION study at the ACR meeting next week", said John Fowler, Chief Executive Officer. "Additionally, the nomination of the first clinical candidate from our protein secretion program is a pivotal step for the company and underscores the depth and breadth of our R&D capabilities. Our small molecule approach to targeting the Sec61 translocon represents a highly compelling new therapeutic approach, and the preclinical data generated with KZR-261 gives us confidence that it may prove effective in treating a variety of tumor types. We are excited to share more about this highly novel target and illustrate the broad platform potential of this approach."

Recent Clinical and Business Highlights

KZR-616 – Selective Immunoproteasome Inhibitor

MISSION Study

The Phase 1b/2 MISSION study in systemic lupus erythematosus (SLE) patients with and without nephritis is currently ongoing.

On October 1, 2019, we presented a corporate and strategic update, including a protocol amendment for the Phase 2 portion of the MISSION study (NCT03393013). The updated protocol is designed to generate more robust and meaningful data around the safety and efficacy of KZR-616 in lupus nephritis, including the evaluation of three dose levels of KZR-616 (administered with background medication) for a treatment period of six months.

The Phase 1b portion of the MISSION study is ongoing and additional data will be presented during a poster session at the 2019 American College of Rheumatology (ACR) Meeting in Atlanta, GA on November 12, 2019.

PRESIDIO Study

In August 2019, we announced the initiation of the PRESIDIO study (NCT04033926), a Phase 2 randomized, double-blind, placebo-controlled, crossover, multicenter study to evaluate the safety, tolerability, efficacy, PK and PD of treatment with KZR-616 in patients with active dermatomyositis (DM) or polymyositis (PM). This trial is expected to enroll 24 patients with either DM or PM.

MARINA Study

In August 2019, we announced the initiation of the MARINA study (NCT04039477), a Phase 2 randomized, dose-blind, multicenter study to evaluate the safety and efficacy of KZR-616 in the treatment of patients with autoimmune hemolytic anemia (AIHA) and immune thrombocytopenia (ITP). This trial is expected to enroll 40 patients with either AIHA or ITP.

KZR-261 – Protein Secretion Program

Our research and discovery efforts targeting the protein secretion pathway have progressed significantly, and today, we announce the nomination of KZR-261 as our first oncology clinical candidate. KZR-261 has demonstrated broad anti-tumor activity in preclinical models of both solid and hematologic malignancies, and we have initiated laboratory studies and manufacturing activities towards an Investigational New Drug (IND) filing for a Phase 1 study in solid tumors, which we anticipate occurring in Q1 2021.

Additionally, this novel program and pathway will be featured in four separate presentations during two major medical and scientific conferences: the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) and the 61st American Society of Hematology (ASH) (Free ASH Whitepaper) Meeting & Exposition (ASH) (Free ASH Whitepaper). The abstract titles are summarized below.

SITC: November 6-10, 2019, National Harbor, MD

Abstract Number: 815

Title: Targeting multiple immune checkpoint proteins with novel small molecule inhibitors of Sec61-dependent cotranslational translocation

Date: Friday, November 8, 2019

Time: 12:30pm – 2:00pm

Poster Session: Novel Single-Agent Immunotherapies

ASH: December 7-10, 2019, Orlando, FL

Oral Presentations

Abstract Number: 408

Title: Blocking Protein Secretion with Novel Small Molecule Inhibitors of Sec61 Represents a Potential Treatment Strategy Against Hematologic Malignancies

Date: Sunday, December 8, 2019
Time: 10:45am

Oral Session: 802. Chemical Biology and Experimental Therapeutics: Novel Compounds and Mechanisms of Action

Abstract Number: 805
Title: Protein Translocation Inhibitors Overcome Cytokine-Induced Glucocorticoid Resistance in T-Cell Acute Lymphoblastic Leukemia

Date: Monday, December 9, 2019
Time: 4:30 PM

Oral Session: 605. Molecular Pharmacology, Drug Resistance—Lymphoid and Other

Poster Presentation

Abstract Number: 2076

Title: Proteomic Profiling and Mechanistic Investigating of a Novel Anti-Cancer Small Molecule Inhibitor of Sec61
Date: Saturday, December 7, 2019
Time: 5:30 PM – 7:30 PM

Poster Session: 802. Chemical Biology and Experimental Therapeutics: Poster I

Financial Results

Cash, cash equivalents and marketable securities totaled $85.2 million as of September 30, 2019, compared to $107.4 million as of December 31, 2018. The decrease in cash, cash equivalents and marketable securities was primarily attributable to cash used by the company in operations to advance its clinical stage programs as well as preclinical research and development.

Research and development expenses for the third quarter of 2019 increased by $2.4 million to $7.1 million compared to $4.7 million in the third quarter of 2018. This increase was primarily related to advancing both the KZR-616 clinical program in multiple indications and the protein secretion preclinical program.

General and administrative expenses for the third quarter of 2019 increased by $1.0 million to $2.6 million compared to $1.6 million in the third quarter of 2018. The increase was primarily due to an increase in personnel expenses and costs related to operating as a public company.

Net loss for the third quarter of 2019 was $9.1 million, or $0.48 per basic and diluted common share, compared to a net loss of $5.7 million, or $0.30 per basic and diluted common share, for the third quarter of 2018.

Total shares outstanding were 19.1 million as of September 30, 2019. Additionally, there were outstanding options to purchase 3.3 million shares of common stock at a weighted average exercise price of $7.39 per share as of September 30, 2019.

About KZR-616

KZR-616 is a novel, first-in-class, selective immunoproteasome inhibitor with broad therapeutic potential across multiple autoimmune diseases. Preclinical research demonstrates that selective immunoproteasome inhibition results in a broad anti-inflammatory response in animal models of several autoimmune diseases, while avoiding immunosuppression. Phase 1a clinical trial results in healthy volunteers provide evidence that KZR-616 potentially avoids adverse effects caused by currently

marketed non-selective proteasome inhibitors, which we believe prevent them from being utilized as a chronic treatment in autoimmune disorders. Phase 2 trials are underway for the treatment of lupus nephritis (MISSION study), dermatomyositis and polymyositis (PRESIDIO study), and autoimmune hemolytic anemia and immune thrombocytopenia (MARINA study).

About KZR-261

KZR-261, a novel, first-in-class protein secretion inhibitor, is the first clinical candidate to be nominated from our research and discovery efforts targeting protein secretion pathways as potential therapies for oncology, immuno-oncology and autoimmune indications. KZR-261 is a broad-spectrum anti-tumor agent that acts through direct interaction and inhibition of Sec61 activity. The compound was discovered at Kezar through a medicinal chemistry campaign in which several scaffolds were progressed through the company’s proprietary work flow of Sec61 modulation. As a result, Kezar has established a unique and broad library of protein secretion inhibitors and a strong patent position around KZR-261 and its analogs. KZR-261 has demonstrated several encouraging features that lend to its potential to be a new anti-cancer agent for the treatment of solid and hematologic malignancies. IND-enabling studies are currently underway, and an IND filing in solid tumors is expected in Q1 2021.

On November 6, 2019 AcelRx Pharmaceuticals, Inc. (Nasdaq: ACRX), (AcelRx), a specialty pharmaceutical company focused on the development and commercialization of innovative therapies for use in medically supervised settings, reported its third quarter 2019 financial results (Press release, AcelRx Pharmaceuticals, NOV 6, 2019, View Source [SID1234550517]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"Achieving 125 REMS-certified facilities two months ahead of our year-end goal demonstrates healthcare providers’ increasing interest in DSUVIA," said Vince Angotti, Chief Executive Officer of AcelRx. "We also expect to achieve our year-end objective of 125 formulary approvals and anticipate expanded use across a variety of healthcare settings as the feedback on DSUVIA from healthcare professionals continues to be very positive," continued Angotti.

Third Quarter and Recent Highlights

130 healthcare facilities are now REMS-certified and able to purchase DSUVIA and 105 formulary approvals have been achieved through October 31, 2019; approximately 60% of REMS certifications and formulary approvals have occurred since the date of the Company’s last earnings call
AcelRx was selected to present at one of the two plenary sessions of the 2019 Military Health System Research Symposium; the presentation was entitled "Pooled Safety Analysis of Patients Who Were Exposed to < 300 mcg vs. ≥300 mcg of Sublingual Sufentanil in a 24 Hour Period for Treatment of Acute Pain"
Pooled dosing and efficacy data from use of the sufentanil sublingual tablet (SST) 30 mcg among multiple demographic subgroups (age, sex, race, and body mass index) was accepted for publication in the Journal of PeriAnesthesia Nursing to aid nurses in understanding the effectiveness and duration of action of SST 30 mcg in the management of moderate-to-severe acute pain across a variety of patient demographics
Financial Information

Cash, cash equivalents and short-term investments balance of $80.4 million as of September 30, 2019;
Combined R&D and SG&A expenses for the third quarter of 2019 totaled $12.0 million compared to $8.8 million for the third quarter of 2018. Excluding stock-based compensation expense, these amounts were $10.7 million for the third quarter of 2019 compared to $7.1 million for the third quarter of 2018. R&D and SG&A expenses for the first nine months of 2019 totaled $35.8 million compared to $23.6 million in the first nine months of 2018. Excluding stock-based compensation expense, these figures were $32.3 million for the first nine months of 2019 compared to $19.9 million for the first nine months of 2018. The increase in R&D and SG&A expenses is primarily due to increased personnel-related expenses for the commercial launch of DSUVIA. See the "Reconciliation of Non-GAAP Financial Measures" table below for a reconciliation of the non-GAAP operating expenses described above to their related GAAP measures;
Net cash outflow for the third quarter of 2019 was $11.1 million, which included $0.6 million in debt service;
For the third quarter of 2019, net loss was $12.7 million, or $0.16 per basic and diluted share, compared to $12.5 million, or $0.21 per basic and diluted share, for the third quarter of 2018. Net loss for the first nine months of 2019 was $38.8 million, or $0.49 per basic and diluted share, compared to $34.6 million, or $0.64 per basic and diluted share, for the prior year period.
Webcast and Conference Call Information
As previously announced, AcelRx will host a live webcast Wednesday, November 6, 2019 at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time) to discuss these financial results and provide other corporate updates. The webcast is accessible by visiting the Investors page of the Company’s website at www.acelrx.com and clicking on the webcast link. The webcast will be accompanied by a slide presentation. Investors who wish to participate in the conference call may do so by dialing (866) 361-2335 for domestic callers, (855) 669-9657 for Canadian callers or (412) 902-4204 for international callers. A webcast replay will be available on the AcelRx website for 90 days following the call by visiting the Investor page of the Company’s website at www.acelrx.com.

About DSUVIA (sufentanil sublingual tablet), 30 mcg
DSUVIA, known as DZUVEO in Europe, approved by the FDA in November 2018, is indicated for use in adults in certified medically supervised healthcare settings, such as hospitals, surgical centers, and emergency departments, for the management of acute pain severe enough to require an opioid analgesic, and for which alternative treatments are inadequate. DSUVIA was designed to provide rapid analgesia via a non-invasive route and to eliminate dosing errors associated with intravenous (IV) administration. DSUVIA is a single-strength solid dosage form administered sublingually via a single-dose applicator (SDA) by healthcare professionals. Sufentanil is an opioid analgesic previously only marketed for IV and epidural anesthesia and analgesia. The sufentanil pharmacokinetic profile when delivered sublingually avoids the high peak plasma levels and short duration of action observed with IV administration. The European Commission approved DZUVEO for marketing in Europe in June 2018 and the Company is currently in discussions with potential European marketing partners.