On November 5, 2019 Ryvu Therapeutics (WSE: RVU) reported that Pawel Przewiezlikowski, Chief Executive Officer, will present a corporate overview at the following conference in Hamburg, Germany (Press release, Ryvu Therapeutics, NOV 5, 2019, View Source [SID1234550386]):

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Event: BIO-Europe 2019, Nov. 11-13, 2019
Location: Congress Center Hamburg
Date/Time: Tuesday, Nov. 12, at 4:15 p.m. CET

On November 5, 2019 Jazz Pharmaceuticals plc (Nasdaq: JAZZ) reported financial results for the third quarter of 2019 and updated 2019 financial guidance (Press release, Jazz Pharmaceuticals, NOV 5, 2019, View Source [SID1234550501]).

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"In the third quarter, we delivered strong revenue and adjusted EPS growth ahead of our expectations. As a result, we are raising our revenue and adjusted EPS guidance for 2019," said Bruce Cozadd, chairman and chief executive officer of Jazz Pharmaceuticals. "Following the recent presentation of the positive JZP-258 Phase 3 data at the World Sleep Congress, we are looking forward to submitting the NDA in January 2020 and plan to redeem our priority review voucher for this submission. The quarter included our U.S. new product launch of Sunosi and execution on other key commercial, R&D and corporate development goals, further positioning us for long-term sustainable growth."

"We made significant progress during the quarter, advancing multiple development programs and expanding our pipeline with the acquisition of Cavion, including JZP-385, a Phase 2 investigational candidate for the treatment of essential tremor," said Robert Iannone, M.D., M.S.C.E., executive vice president, research and development, of Jazz Pharmaceuticals. "Importantly, given the urgent patient need, we finalized the protocol for the Phase 2/3 study of JZP-458, our recombinant Erwinia asparaginase, for acute lymphoblastic leukemia and one year after submitting our IND, we are working toward recruiting the first patient in this pivotal study."

GAAP net income for the third quarter of 2019 was $102.3 million, or $1.78 per diluted share, compared to $149.3 million, or $2.41 per diluted share, for the third quarter of 2018. GAAP net income and EPS for the third quarter of 2019 included the impact of acquired in-process research and development expense primarily related to the company’s acquisition of Cavion, Inc. (Cavion).

Non-GAAP adjusted net income for the third quarter of 2019 was $235.3 million, or $4.10 per diluted share, compared to $221.7 million, or $3.58 per diluted share, for the third quarter of 2018. Reconciliations of applicable GAAP reported to non-GAAP adjusted information are included at the end of this press release.

Key Corporate and R&D Updates

In August 2019, the company acquired Cavion in a merger transaction. Under the terms of the agreement, the former Cavion shareholders received an upfront payment of $52.5 million and have the potential to receive additional payments of up to $260.0 million upon the achievement of certain clinical, regulatory and commercial milestones, for a total potential consideration of $312.5 million. Cavion’s lead molecule, CX-8998, now JZP-385, has been evaluated in a Phase 2 randomized, placebo-controlled clinical study and demonstrated proof-of-concept as a potential treatment for essential tremor.

In September 2019, the company presented positive results from the Phase 3 study of JZP-258, which demonstrate the efficacy of JZP-258 for the treatment of cataplexy and excessive daytime sleepiness (EDS) in adults with narcolepsy. The JZP-258 study met its primary and key secondary endpoints demonstrating highly statistically significant differences in weekly number of cataplexy attacks and Epworth Sleepiness Scale scores compared to placebo. JZP-258 is a novel oxybate formulation with a unique composition of cations resulting in 92% less sodium, or approximately 1 to 1.5 grams less sodium per night, than Xyrem (sodium oxybate) oral solution.

In October 2019, the company announced that the first patient was enrolled in an exploratory Phase 2 clinical trial evaluating the ability of defibrotide to prevent neurotoxicity in patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL) receiving chimeric antigen receptor t-cell (CAR T-cell) therapy.

In October 2019, U.S. Food and Drug Administration (FDA) granted Fast Track designation to JZP-458 for the treatment of acute lymphoblastic leukemia (ALL)/lymphoblastic lymphoma (LBL).

Today, the company announced that it expects to submit the JZP-258 New Drug Application (NDA) in January 2020 and plans to redeem its priority review voucher for this submission.

Today, the company announced that Mike Miller will retire from his role as Executive Vice President, U.S. Commercial effective March 31, 2020. Mr. Miller will continue as an employee of the company through June 30, 2020, to ensure a smooth transition to new leadership. The company plans to begin a search for Mr. Miller’s successor soon.

Select 2019 Milestones*

Xyrem (sodium oxybate) oral solution

Launched for the treatment of cataplexy or EDS in pediatric narcolepsy in March

JZP-258

Announced positive top-line results from Phase 3 narcolepsy study in March

Received Orphan Drug Designation from FDA for idiopathic hypersomnia indication

Presented positive results from Phase 3 narcolepsy study at World Sleep Congress meeting in September

NDA submission as early as year-end (now intend to submit January 2020)

Sunosi (solriamfetol)

Received FDA approval for EDS in narcolepsy or obstructive sleep apnea (OSA) in March

Received U.S. Drug Enforcement Agency scheduling decision in June

Launched in the U.S. in July

Identified EDS associated with Major Depressive Disorder as a new area of interest

Obtain EU approval for EDS in narcolepsy or OSA as early as year-end (now anticipate Committee for Medicinal Products for Human Use (CHMP) opinion November 2019; expect European Medicines Agency (EMA) decision early 2020)

Vyxeos (daunorubicin and cytarabine) liposome for injection

Positive data presented by Children’s Oncology Group (COG) in children and young adults with relapsed/refractory acute myeloid leukemia (AML) at American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) in June

Activated sites for Phase 1 attenuated dose finding study of Vyxeos in higher risk myelodysplastic syndrome (MDS) through MD Anderson collaboration (FPI 2Q19)

Activated sites for Phase 1b study of low intensity therapy of Vyxeos in combination with venetoclax in first-line, unfit AML (FPI 4Q19)

Activated sites for Phase 3 study in adult patients with newly diagnosed standard- and high-risk AML through the AML Study Group, a cooperative group (FPI 3Q19)

Activated sites for Phase 2 study in patients with high-risk MDS through the European Myelodysplastic Syndromes Cooperative Group (FPI 3Q19)

Activate sites for Phase 1b master trial of Vyxeos in combination with various targeted agents in first-line, fit AML

Potential interim combination data results from studies conducted through MD Anderson collaboration

Activate sites in the COG Phase 3 study in newly diagnosed pediatric patients with AML

Activate sites for Phase 2 study in newly diagnosed, fit, older adults with high-risk AML

Activate sites for Phase 2 study in a broader age range of adults with high-risk AML

Defitelio (defibrotide sodium) / defibrotide

Positive results from DEFIFrance study presented at European Society for Blood and Marrow Transplant meeting in March

Nippon Shinyaku Co., Ltd. received marketing authorization for Defitelio in Japan in June and launched in September

Activated sites for exploratory Phase 2 study in CAR T-cell therapy associated neurotoxicity (FPI 4Q19)

Completed enrollment in prevention of acute graft-vs-host disease Phase 2 study

Conduct interim analysis (IA) in the prevention of hepatic veno-occlusive disease (VOD) study (now expect to conduct 1H20)

Activate sites for Phase 2 study in transplant-associated thrombotic microangiopathy (activities discontinued)

JZP-458

FDA granted Fast Track designation to JZP-458 for the treatment of ALL/LBL

Activate sites for single-arm, pivotal Phase 2/3 clinical study in ALL/LBL

CombiPlex

Continue Investigational New Drug enabling activities for a solid tumor combination; progress exploratory activities for other hematology/oncology candidates

* Milestones denoted as ✔=completed, x=not completed, •=milestones planned for 2019. FPI = First Patient In

Total revenues increased 15% in the third quarter of 2019 compared to the same period in 2018.

Xyrem net product sales increased 19% in the third quarter of 2019 compared to the same period in 2018.

Erwinaze/Erwinase net product sales decreased 17% in the third quarter of 2019 compared to the same period in 2018 due to ongoing supply and manufacturing issues at the sole manufacturer, resulting in limited product availability during the quarter. The company anticipates ongoing manufacturing issues and supply disruptions for the fourth quarter of 2019 and in 2020.

Defitelio/defibrotide net product sales increased 4% in the third quarter of 2019 compared to the same period in 2018. The company continues to expect inter-quarter variability in Defitelio net sales.

Vyxeos net product sales increased 41% in the third quarter of 2019 compared to the same period in 2018 primarily due to the ongoing EU launch. The company continues to implement its education and outreach initiatives while advancing a development program to support potential expanded uses of Vyxeos.

Sunosi net product sales were $1.0 million in the third quarter of 2019, following the U.S. launch in July 2019.

Operating expenses changed over the prior year period primarily due to the following:

Selling, general and administrative (SG&A) expenses increased in the third quarter of 2019 compared to the same period in 2018 on a GAAP and on a non-GAAP adjusted basis primarily due to expenses related to the expansion of the company’s business, including the U.S. launch of Sunosi.
Research and development (R&D) expenses increased in the third quarter of 2019 on a GAAP and on a non-GAAP adjusted basis primarily due to expenses related to the company’s expanding pre-clinical and clinical development programs and support of its partner programs, including a milestone of $11.0 million payable to Pfenex, Inc. under a license and option agreement to develop and commercialize multiple early stage hematology product candidates.
Cash Flow and Balance Sheet

As of September 30, 2019, cash, cash equivalents and investments were $1.1 billion, and the outstanding principal balance of the company’s long-term debt was $1.8 billion. During the nine months ended September 30, 2019, the company generated $688.6 million of cash from operations, used $191.1 million to repurchase shares under the company’s share repurchase program, made milestone payments totaling $80.5 million related to Sunosi, and made upfront payments of $52.5 million to acquire Cavion, Inc. and $56.0 million to Codiak BioSciences, Inc. (Codiak) under a collaboration agreement.

In the nine months ended September 30, 2019, the company repurchased approximately 1.5 million ordinary shares under the company’s share repurchase program at an average cost of $131.48 per ordinary share. As of September 30, 2019, the remaining amount authorized for share repurchases was $188.1 million. In October 2019, the company’s board of directors increased the share repurchase program by $500 million.

2019 Financial Guidance

Jazz Pharmaceuticals is updating its full year 2019 financial guidance as follows (in millions, except per share amounts and percentages):

Includes minimal net sales contribution from Sunosi in the U.S.

Excludes $6-$8 million of share-based compensation expense from estimated GAAP gross margin.

Excludes $82-$90 million of share-based compensation expense from estimated GAAP SG&A expenses.

Excludes $22-$27 million of share-based compensation expense from estimated GAAP R&D expenses.

Includes an income tax benefit of $112.3 million related to an intra-entity intellectual property asset transfer.

Excludes the income tax effect of adjustments between GAAP reported and non-GAAP adjusted net income and the income tax benefit related to an intra-entity intellectual property asset transfer.

Includes expected intangible asset amortization of $111 million in the fourth quarter of 2019 as a result of the Company’s notification to the FDA of its intention to redeem its priority review voucher for the planned NDA submission for JZP-258.

See "Non-GAAP Financial Measures" below. Reconciliations of non-GAAP adjusted guidance measures are included above and in the table titled "Reconciliation of GAAP to Non-GAAP Adjusted 2019 Net Income Guidance" at the end of this press release.

Conference Call Details

Jazz Pharmaceuticals will host an investor conference call and live audio webcast today at 4:30 p.m. EST (9:30 p.m. GMT) to provide a business and financial update and discuss its 2019 third quarter results. The live webcast may be accessed from the Investors section of the company’s website at www.jazzpharmaceuticals.com. Please connect to the website prior to the start of the conference call to ensure adequate time for any software downloads that may be necessary. Investors may participate in the conference call by dialing +1 855 353 7924 in the U.S., or +1 503 343 6056 outside the U.S., and entering passcode 9398898.

A replay of the conference call will be available through November 12, 2019 by dialing +1 855 859 2056 in the U.S., or +1 404 537 3406 outside the U.S., and entering passcode 9398898. An archived version of the webcast will be available for at least one week in the Investors section of the company’s website at www.jazzpharmaceuticals.com.

On November 5, 2019 Ambry Genetics (Ambry), a leading clinical genetic testing company, reported that it will present at this week’s National Society of Genetic Counselors Annual Conference in Salt Lake City, Utah, data from the first 2,500 patients that received +RNAinsight, paired RNA and DNA genetic testing for hereditary cancer risk (Press release, Ambry Genetics, NOV 5, 2019, View Source [SID1234550595]). Data revealed that +RNAinsight resulted in a substantial increase in diagnostic yield, identifying more patients with genetic mutations (disease-causing errors in our DNA) compared to DNA testing alone. This is the first major increase in diagnostic yield for hereditary cancer risk in over 10 years, since the adoption of deletion/duplication testing. Through +RNAinsight, Ambry is the first and only lab to offer paired RNA and DNA genetic testing for hereditary cancer as a commercially available clinical test.

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Standard DNA testing for hereditary cancer risk excludes large portions of DNA, thereby missing some mutations. In addition, DNA testing can produce inconclusive results and fail to determine that an error in our DNA increases cancer risk. These limitations impact patients and their families because doctors may not have the information needed to recommend appropriate preventive, early detection, or therapeutic steps. Additionally, relatives may not be referred for genetic testing and obtain the care they would otherwise have gotten if they had learned they had mutations.

Adding RNA to DNA testing overcomes these limitations for a substantial number of patients as it provides considerably more evidence than DNA testing alone about whether our DNA has mutations. Ambry will present data showing that paired testing with +RNAinsight both (1) identified new mutations that would have been missed with DNA testing alone, and (2) clarified inconclusive results as disease-causing. DNA testing alone would have found these latter results as inconclusive and left doctors without this crucial information.

"These findings further demonstrate that hereditary cancer panels should include both RNA and DNA genetic testing," said Rachid Karam, MD, PhD, lead study author and Director of the Translational Genomics Lab at Ambry Genetics. "By looking at regions of the gene that other tests don’t, +RNAinsight reduces false negatives, maximizing the number of patients who learn they have higher risks for hereditary cancer."

The data show an overall relative increase in diagnostic yield of 6.7 percent compared to DNA testing alone, increasing by as much as 19 percent for specific genes. For example, for BRCA1, 14 percent more patients learned they had a mutation that increased their cancer risks than would have if they had only received DNA testing. Moreover, by analyzing regions of DNA known as introns that standard DNA testing alone does not assess, paired RNA and DNA testing found completely new mutations that DNA-only testing would not have found or identified as disease-causing. Thus, patients who learn they have mutations from paired testing can get the appropriate medical treatment while those who undergo standard DNA testing alone might not because they may never learn they have those mutations.

RNA genetic testing also resulted in an overall 4.5 percent relative decrease in the number of patients that would have received inconclusive results with DNA testing alone, reducing inconclusive results by as much as 9 percent in specific genes. As with identifying entirely new mutations, clarifying results can let more patients with mutations learn they have them.

+RNAinsight is now available through doctors and genetic counselors around the country. For more information on RNA genetic testing, please go to www.ambrygen.com/RNAinsight.

In addition to this paired RNA and DNA testing data, Holly LaDuca, Senior Manager, Clinical Affairs Research at Ambry, will present data from a survey sent to clinicians assessing how genetic testing results inform patient care.

Since January 2018, Ambry Genetics has provided surveys to all clinicians ordering hereditary cancer testing through Ambry both before and after they receive their patients’ genetic test results. In the first few months of offering the survey, 131 providers completed pre-and post-test surveys for 469 patients who received genetic testing. When genetic testing found mutations, changes to preventive screening recommendations were made for 62.1 percent of patients and surgical recommendations were made for 37.9 percent of patients. In addition, 40.9 percent of clinicians recommended genetic counseling changes, such as the testing of family members and discussions of reproductive risks.

"Management guidelines have been developed for numerous cancer-predisposition genes. However, data is limited on how these guidelines and genetic testing results impact patient care in the real world," said Ms. LaDuca. "Preliminary data from this ongoing survey demonstrate that positive genetic test results frequently lead to changes in medical management."

For the full list of studies that will be presented at NSGC, please see below:

Featured Oral Presentations at 2019 NSGC

Date & Time

Presentation

Presenter

Session

Tues., Nov. 5,
2019

8:30 AM – 2:30
PM

Clarity in Chaos: Using somatic
genetic testing to inform germline
interpretation

Pia
Summerour

Session #A03: Pre-
Conference
Symposium

Wed., Nov. 6,
2019

12:30 PM

Unparalleled Clarity and Mutations:
Clinical RNA Testing Provides
Answers Beyond DNA

Rachid Karam

Level 2,

Room 250

Lunch Presentation

Thurs., Nov. 7,
2019

3:10 PM- 4:40
PM

The New GC in Town: Demystifying
the Role of Gene Curation in Variant
Interpretation, Clinical Reporting and
Case Reanalysis

Kelly Radtke

Session #C16:
Educational Breakout
Session

Featured Poster Presentations at 2019 NSGC

Date & Time

Presentation

Lead Author

Poster

Wed., Nov. 6,
2019

6:15 PM – 7:30
PM

A Nationwide Multi-Center Study Provides Insight
into the Increase in Clinically Actionable Results
from Concurrent DNA and RNA Genetic Testing

Rachid Karam

B-131

Investigating Variants of Uncertain Significance:
Reclassification Triggers and Drivers in Breast
Cancer Predisposition Genes

Kirsten Kelly

B-233

Thurs., Nov. 7,
2019

1:20 PM – 2:35
PM

Better than Guidelines? Pre & Post Genetic Testing
Data Suggests Change in Management Trends

Zöe Powis

C-132

What Should I Order? Genetic Testing Ordering
Trends for Autism Spectrum Disorder

Catherine
Schultz

C-294

On November 5, 2019 Evelo Biosciences, Inc. (Nasdaq:EVLO), a clinical stage biotechnology company developing a new modality of orally delivered, systemically acting biologics, reported third quarter 2019 financial results (Press release, Evelo Biosciences, NOV 5, 2019, View Source [SID1234550294]). Additionally, in a separate press release, the Company announced positive interim clinical data in a Phase 1b trial in individuals with mild to moderate psoriasis being treated with a high dose of EDP1815, its clinical candidate for the treatment of a range of inflammatory diseases.

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"We now have further clinical data that support our potential ability to treat systemic inflammatory disease through oral delivery of pharmaceuticals to the small intestinal axis," said Simba Gill, Ph.D., chief executive officer of Evelo. "The clinical activity demonstrated by EDP1815 in psoriasis further validates our platform and highlights Evelo’s potential to bring new medicines with the potential to be effective, safe, convenient and affordable to millions of people living with chronic diseases."

Inflammation

Interim Clinical Data Highlights

About the EDP1815 Phase 1b clinical trial in mild to moderate psoriasis, high dose cohort

Eighteen individuals with mild to moderate psoriasis were randomized 2:1 to receive a daily oral administration of 2.76g (5x or high dose) of EDP1815 or placebo for 28 days. The primary endpoint is safety and tolerability. Secondary and exploratory endpoints include lesion severity score (LSS) and Psoriasis Area and Severity Index (PASI), both measures of clinical activity, as well as cellular histological biomarkers and blood immune cell biomarkers taken from biopsies and blood samples at the start and end of the dosing period, respectively. Safety and tolerability and secondary clinical endpoints are also measured at day 42, 2 weeks after completion of dosing.

EDP1815 – positive interim Phase 1b clinical data at high dose

In a separate press release, Evelo reported positive interim clinical data from the high dose cohort in its Phase 1b trial of EDP1815 in mild to moderate psoriasis.
EDP1815 continued to be well tolerated in this cohort, with no overall difference reported from placebo.
At the end of the 28-day dosing period, the high dose cohort showed a mean reduction in LSS consistent with previously reported data for a low dose cohort.
Two weeks following the completion of the dosing period, at day 42, the high dose cohort showed continued reductions from baseline in both mean LSS and PASI, which may be indicative of a sustained clinical effect and dose response.
A range of histological and molecular biomarkers were measured in the high dose cohort, with trends in line with the clinical effects of EDP1815 at the cohort level.
Evelo plans to advance EDP1815 into Phase 2 in early 2020. This placebo-controlled dose and formulation selection trial will investigate daily dosing of EDP1815 in mild to moderate psoriasis patients over 16 weeks. Evelo expects to report initial data from the trial in late 2020.
Anticipated Milestones

EDP1815 – Phase 1b new formulation in psoriasis and atopic dermatitis

Given the newly released positive EDP1815 data and the planned Phase 2 trial, Evelo will not enroll any further cohorts of individuals with psoriasis in the ongoing Phase 1b clinical trial.
The Company expects to report initial clinical data from a cohort of individuals with mild to moderate atopic dermatitis to be dosed with a new formulation in the second quarter of 2020.
EDP1066 – Phase 1b new formulation in atopic dermatitis

Evelo expects to report initial clinical data from a cohort of individuals with mild to moderate atopic dermatitis, dosed with a new formulation, in the first quarter of 2020.
Oncology

Clinical Studies and Anticipated Milestones

EDP1503 – Phase 1/2

Evelo is conducting a Phase 1/2 clinical trial of EDP1503 in combination with KEYTRUDA (pembrolizumab), Merck’s anti-PD-1 therapy.
The cohort of patients with microsatellite stable colorectal cancer who had previously failed all therapies for metastatic disease is fully recruited. No clinical responses have been evident; however, several patients in this cohort have experienced extended stable disease. Cellular infiltration biomarker changes were also observed in tumor biopsies taken from those patients during the EDP1503 monotherapy period, which are consistent with preclinical observations for EDP1503. Evelo continues to monitor patients in this cohort.
Given newly approved treatments for triple-negative breast cancer, Evelo anticipates that the majority of triple negative breast cancer patients to be recruited will have relapsed following prior PD-1/L1 therapy, similarly to those in the PD-1 relapsed cohort.
Evelo expects to report further clinical data from this trial in the first half of 2020.
Business Highlights

In September 2019, Evelo appointed David Epstein as chairman of its Board of Directors. Mr. Epstein, who has been a director of Evelo since March 2017, brings extensive experience and relationships in the biotech and pharmaceutical industries to his role as chairman. He currently serves as chairman of the Board of Directors of Rubius Therapeutics and Axcella Health and as a director at International Flavors and Fragrances. From January 2010 – July 2016, Mr. Epstein served as chief executive officer of Novartis Pharmaceuticals, a division of Novartis AG. In conjunction with Mr. Epstein’s appointment, Noubar Afeyan, Ph.D., co-founder of Evelo and chief executive officer of Flagship Pioneering, stepped down from his role on Evelo’s Board.
Third Quarter 2019 Financial Results

Cash Position: As of September 30, 2019, cash and cash equivalents were $97.1 million, as compared to cash, cash equivalents and investments of $147.9 million as of December 31, 2018 and $113.5 million as of June 30, 2019. This decrease was due to cash used to fund operating activities and capital expenditures for the third quarter of 2019. Evelo expects that its cash and cash equivalents, together with funds available under tranche 2 of its debt facility, will enable it to fund its planned operating expenses and capital expenditure requirements to the end of 2020.
Research and Development Expenses: R&D expenses were $15.6 million for the three months ended September 30, 2019, compared to $11.2 million for the three months ended September 30, 2018. The increase of $4.4 million was due primarily to increases in costs related to Evelo’s inflammation clinical programs and research platform expenses, as well as increased personnel costs.
General and Administrative Expenses: G&A expenses were $5.9 million for the three months ended September 30, 2019, compared to $5.2 million for the three months ended September 30, 2018. The increase of $0.7 million was due primarily to increased personnel costs to support Evelo’s growth.
Net Loss: Net loss attributable to common stockholders was $21.6 million for the three months ended September 30, 2019, or $0.67 per basic and diluted share, as compared to a net loss of $15.9 million for the three months ended September 30, 2018, or $0.50 per basic and diluted share.
Conference Call

Evelo will host a conference call and webcast at 8:30 a.m. EST today to review the new clinical data for EDP1815. To access the call please dial 866-795-3242 (domestic) or 409-937-8909 (international) and refer to conference ID 7788384. A live webcast of the event will also be available under "News and Events" in the Investors section of Evelo’s website at View Source The archived webcast will be available on Evelo’s website approximately two hours after the completion of the event and will be available for 30 days following the call.

On November 5, 2019 Fate Therapeutics, Inc. (NASDAQ: FATE), a clinical-stage biopharmaceutical company dedicated to the development of programmed cellular immunotherapies for cancer and immune disorders, reported business highlights and financial results for the third quarter ended September 30, 2019 (Press release, Fate Therapeutics, NOV 5, 2019, View Source [SID1234550322]).

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"We achieved several significant clinical milestones over the past three months including treating the first patients with FT516, the first-ever engineered iPSC-derived cellular immunotherapy, and securing FDA clearance to initiate clinical investigation of FT596, the first-ever cellular immunotherapy engineered to express three active anti-tumor modalities. We also successfully opened our new cGMP facility specifically designed to enable consistent, large-scale, and cost-effective manufacture of allogeneic NK cell and CAR-T cell products using clonal master iPSC lines as a starting cell source," said Scott Wolchko, President and Chief Executive Officer of Fate Therapeutics. "We look forward to the ASH (Free ASH Whitepaper) annual meeting in December, where we have had six abstracts accepted and will be sharing our first-in-human insights into the clinical safety and tolerability of FT500, the first-ever iPSC-derived cell therapy to be administered off-the-shelf in multiple doses over multiple cycles. With the completion of our recent common stock offering in September, we are well-positioned to generate clinical data across our iPSC-derived, cell-based cancer immunotherapy pipeline in 2020."

Clinical Programs

First-ever Patient Treatment with Engineered iPSC-derived Cell Product. In October 2019, two patients at the M Health Fairview University of Minnesota Medical Center were treated with FT516, the Company’s off-the-shelf natural killer (NK) cell cancer immunotherapy derived from a clonal master induced pluripotent stem cell (iPSC) line engineered to express a novel high-affinity, non-cleavable CD16 Fc receptor. FT516 is the first-ever cell product in the world derived from a genetically engineered pluripotent stem cell to be administered to patients. The first patient received FT516 in combination with rituximab for the treatment of diffuse large B-cell lymphoma, and the second patient received FT516 as a monotherapy for the treatment of acute myeloid leukemia.

Initiated Enrollment at 300M Cell Dose Level in FT500 ICI Combination Arm. The Company is conducting an open-label, multi-dose Phase 1 clinical trial of FT500, an off-the-shelf NK cell cancer immunotherapy derived from a clonal master iPSC line, for the treatment of advanced solid tumors. The dose-escalating stage of the Phase 1 study is designed to assess the safety and tolerability of administering up to six doses of FT500 as a monotherapy and in combination with immune checkpoint inhibitor (ICI) in an outpatient setting. In the monotherapy arm of the study, three patients have been treated at 100 million cells per dose and five patients have been treated at 300 million cells per dose, with no reported dose-limiting toxicities (DLTs) or FT500-related serious adverse events. Additionally, in the combination arm of the study in patients that have failed prior ICI therapy, three patients have been treated at 100 million cells per dose in combination with ICI therapy, with no reported DLTs or FT500-related serious adverse events. The Company is currently enrolling patients at 300 million cells per dose in the combination arm of the study.

Received FDA Clearance of IND Application for FT596. In September, the U.S. Food and Drug Administration (FDA) allowed the Company’s Investigational New Drug (IND) application for FT596, the Company’s first off-the-shelf chimeric antigen receptor (CAR) NK cell cancer immunotherapy, which is uniquely designed to engage multiple tumor-associated antigens expressed on cancer cells for best-in-class activity. FT596 is derived from a clonal master iPSC line engineered with three anti-tumor functional modalities: a proprietary CAR optimized for NK cell biology that targets the B-cell antigen CD19; a novel high-affinity, non-cleavable CD16 Fc receptor that is designed to augment antibody dependent cellular cytotoxicity (ADCC); and an IL-15 receptor fusion (IL-15RF), a potent cytokine complex that promotes NK cell activation without the need for systemic cytokine support. Study initiation is underway at multiple clinical sites for the first-in-human Phase 1 clinical trial of FT596 as a monotherapy, in combination with rituximab for the treatment of advanced B-cell lymphoma, and in combination with obinutuzumab for the treatment of chronic lymphocytic leukemia.

Completed Enrollment in Phase 2 PROTECT Study of ProTmune. In October, the Company completed enrollment in the randomized, controlled and double-blinded Phase 2 PROTECT study of ProTmune, the Company’s first-in-class, allogeneic hematopoietic cell graft for the prevention of acute graft-versus-host disease (GvHD) in patients undergoing hematopoietic cell transplantation (HCT) for the treatment of hematologic malignancies. ProTmune has been granted Orphan Drug and Fast Track Designations by the FDA, and Orphan Medicinal Product Designation by the European Commission.

Corporate Highlights

Opened State-of-the-Art cGMP Manufacturing Facility Dedicated to iPSC-derived Cell Therapies. In September 2019, the Company opened its current Good Manufacturing Practice (cGMP) manufacturing facility for the clinical production of its off-the-shelf NK cell and CAR T-cell product candidates. The Company’s facility, located in San Diego, California, is custom designed to use clonal master iPSC lines as a renewable cell source for the manufacture of off-the-shelf allogeneic cell products. The new state-of-the-art facility has been commissioned and qualified, the Company has been issued a drug manufacturing license by the State of California, Department of Health Services, Food and Drug Branch, and the Company has commenced manufacture of certain of its product candidates.

Foundational U.S. Patent Issued Covering iPSC-derived CAR T Cells. In August 2019, the U.S. Patent and Trademark Office issued U.S. Patent No. 10,370,452 covering compositions and uses of effector T cells expressing a CAR, where such T cells are derived from a pluripotent stem cell including an iPSC. The claims of this newly-issued patent are not restricted by the signaling domain of the CAR construct nor by the antigen to which the CAR targets and binds. The patent is expected to expire in 2034, and is owned by Memorial Sloan Kettering Cancer Center (MSK) and is licensed exclusively to Fate Therapeutics for all human therapeutic uses. The Company is currently conducting IND-enabling activities for FT819, its first off-the-shelf, iPSC-derived CAR T-cell product candidate, under its collaboration with MSK.

Completed $173 Million Common Stock Offering. In September 2019, the Company closed an underwritten public offering of 9.9 million shares of its common stock at a public offering price of $17.50 per share.

Third Quarter 2019 Financial Results

Cash & Short-term Investment Position: Cash, cash equivalents and short-term investments as of September 30, 2019 were $302.8 million, compared to $201.0 million as of December 31, 2018. The increase was driven primarily by $162.4 million in net cash proceeds received by the Company from its September 2019 public offering of common stock. These proceeds were offset by the Company’s use of cash to fund operating activities.

Total Revenue: Revenue was $2.4 million for the third quarter of 2019, compared to $1.0 million for the same period in 2019. Revenue for the third quarter of 2019 was derived from the Company’s collaboration with Ono Pharmaceutical.

R&D Expenses: Research and development expenses were $23.2 million for the third quarter of 2019, compared to $13.6 million for the same period in 2018. The increase in R&D expenses was attributable primarily to an increase in employee compensation, including share-based compensation, and in expenses associated with the clinical development and manufacture of the Company’s product candidates and the conduct of research activities including under the collaboration with Ono Pharmaceutical.

G&A Expenses: General and administrative expenses were $6.3 million for the third quarter of 2019, compared to $4.1 million for the same period in 2018. The increase in G&A expenses was attributable primarily to an increase in employee compensation, including share-based compensation.

Shares Outstanding: Common shares outstanding were 75.4 million as of September 30, 2019 and 64.7 million as of December 31, 2018. Preferred shares outstanding as of September 30, 2019 and December 31, 2018 were 2.8 million, each of which is convertible into five shares of common stock.

Today’s Conference Call and Webcast

The Company will conduct a conference call today, Tuesday, November 5, 2019 at 5:00 p.m. ET to review financial and operating results for the quarter ended September 30, 2019. In order to participate in the conference call, please dial 877-303-6235 (domestic) or 631-291-4837 (international) and refer to conference ID 4748666. The live webcast can be accessed under "Events & Presentations" in the Investors & Media section of the Company’s website at www.fatetherapeutics.com. The archived webcast will be available on the Company’s website beginning approximately two hours after the event.