On October 31, 2019 Momenta Pharmaceuticals, Inc. (Nasdaq: MNTA), a biotechnology company focused on discovering and developing novel biologic therapeutics to treat rare immune-mediated diseases, reported its financial results for the third quarter ended September 30, 2019 (Press release, Momenta Pharmaceuticals, OCT 31, 2019, View Source [SID1234550130]).

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"Our focus in 2019 is on the execution of our clinical programs as they advance toward proof of concept," said Craig A. Wheeler, President and Chief Executive Officer of Momenta Pharmaceuticals. "Looking ahead to 2020, we anticipate key readouts across our novel auto- and alloimmune programs, including proof-of-concept data from M254 in ITP and nipocalimab in MG. Importantly, both of these agents have the potential to reshape the treatment landscape for a range of large market, IgG-mediated diseases."

Third Quarter 2019 Highlights, Recent Events and Anticipated Upcoming Milestones

Novel Therapeutics Pipeline:

Nipocalimab (M281): a fully human anti-neonatal Fc receptor (FcRn) aglycosylated immunoglobulin G (IgG1) monoclonal antibody (mAb)

•Vivacity-MG, the Company’s Phase 2 clinical study of nipocalimab in generalized myasthenia gravis (gMG), continues to enroll patients. The Company expects to report top-line data from this study in the second or third quarter of 2020.

•Unity, the Company’s global multi-center Phase 2 clinical study of nipocalimab in hemolytic disease of the fetus and newborn (HDFN), is active and enrolling patients. Nipocalimab has been granted Fast Track designation by the U.S. Food and Drug Administration (FDA) for this indication and the Company expects to report top-line from this study data in 2021.

•Energy, the Company’s adaptive Phase 2/3 clinical study of nipocalimab in Warm Autoimmune Hemolytic Anemia (wAIHA) commenced in the third quarter 2019. The Company is activating clinical sites in both the United States and European Union and is actively recruiting patients. Nipocalimab has been granted Fast Track designation by the FDA in this indication and the Company expects to report top-line data from this study around the end of 2021.

M254 (hsIgG): a hypersialylated immunoglobulin designed as a high potency alternative for intravenous immunoglobulin (IVIg)

•The Company’s multi-part Phase 1/2 clinical trial in idiopathic thrombocytopenic purpura (ITP) has completed Part A and is progressing through Part B, which is evaluating M254 in a single ascending dose (SAD) cohort of ITP patients. Parts C and D include a randomized cross-over study comparing M254 to IVIg and a multiple ascending dose (MAD) study of M254, respectively. Enrollment is ongoing and the Company expects to report preliminary data from this study in the first half of 2020.

M230 (CSL730): a recombinant Fc multimer being developed in collaboration with CSL

•A Phase 1 clinical trial to evaluate the safety and tolerability of M230 in healthy volunteers is ongoing and Momenta’s partner, CSL, looks forward to introducing a subcutaneous formulation into the phase 1 program. We expect to have data regarding this formulation in the next calendar year.

Legacy Products:

Glatopa 20 mg and 40 mg: FDA approved generic versions of COPAXONE 20 mg and 40 mg, developed and commercialized in collaboration with Sandoz

•In the third quarter of 2019, Momenta recorded $5.6 million in product revenue from Sandoz’s sales of Glatopa products.

M710: a proposed biosimilar to EYLEA (aflibercept) candidate being developed in collaboration with Mylan

•Iylan continues its pivotal clinical trial in patients with diabetic macular edema to compare safety, efficacy and immunogenicity of M710 with EYLEA.

Corporate:

•In September 2019, the Company announced the appointment of Donna Grogan, M.D. to its Board of Directors.

Third Quarter 2019 Financial Results

Revenue:

In the third quarter of 2019, the Company recorded $5.6 million in product revenue from Sandoz’s sales of Glatopa. In the third quarter of 2018, the Company recorded $13.6 million in product revenue, net a deduction of $0.2 million for legal fees and includes 1.7 million received by Momenta for the Pfizer settlement. The decrease in product revenue from the prior year period was primarily due to continued competition.

Research and development revenue for the third quarter of 2019 was $0.8 million, compared to $1.3 million in the same quarter in 2018. The decrease in research and development revenue of $0.4 million, or 34%, was primarily due to lower reimbursement revenue for Glatopa expenses.

Total revenue for the third quarter of 2019 was $6.4 million compared to $14.9 million for the same period in 2018.

Operating Expenses:

Research and development expenses for the third quarter of 2019 were $46.1 million, compared to $30.7 million for the same period in 2018. The increase of $15.3 million, or 50%, was primarily due to an increase in manufacturing and clinical trial costs for nipocalimab and M254, offset in part by lower personnel costs following the Company’s workforce reduction in the fourth quarter of 2018 and lower lease costs.

General and administrative expenses for the third quarter of 2019 were $20.1 million, compared with $20.4 million for the same period in 2018. The decrease of $0.4 million, or 2%, was primarily due to lower depreciation costs.

In July 2019, Momenta entered into an amendment to its office and laboratory space lease at 320 Bent Street in Cambridge, Massachusetts, reducing the Company’s footprint at the location. During the quarter, the company recognized a noncash gain of $13.7 million, reflecting the reduction in the lease liability and the related right-of-use asset.

Total GAAP operating expenses were $52.5 million in the third quarter of 2019. Third quarter 2019 non-GAAP operating expense was $45.7 million. Non-GAAP operating expense is total operating expenses, less stock-based compensation expense, restructuring expense and collaborative reimbursement revenue. See "Non-GAAP Financial Information and Other Disclosures" and the table below entitled "Reconciliation of GAAP Results to Non-GAAP Financial Measures" for a reconciliation of GAAP operating expense to non-GAAP operating expense.

Net Income (Loss): The Company reported a net loss of $44.5 million, or $0.45 per share for the second quarter of 2019 compared to a net loss of $50.3 million, or $0.65 per share for the same period in 2018.

Liquidity: At September 30, 2019, Momenta had $325.9 million in cash, cash equivalents, marketable securities, and reflects the addition of $36.1 million related to the release of a bond following a settlement agreement with Amphastar Pharmaceuticals. This compares to $449.4 million at December 31, 2018 in cash, cash equivalents, and marketable securities.

2019 Financial Guidance

Momenta provides non-GAAP operating expense guidance, which it believes can enhance an overall understanding of its financial performance when considered together with GAAP financial measures. Refer to the section of this press release below entitled "Non-GAAP Financial Information and Other Disclosures" for further discussion of this subject.

Non-GAAP operating expense is total operating, less stock-based compensation expense, restructuring expense and collaborative reimbursement revenue. Momenta is providing quarterly non-GAAP operating expense guidance of $50 – $60 million for the fourth quarter 2019.

Non-GAAP Financial Information and Other Disclosures

Momenta uses a non-GAAP financial measure, non-GAAP operating expense, to provide operating expense guidance. Momenta believes this non-GAAP financial measure is useful to investors because it provides greater transparency regarding Momenta’s operating performance as it excludes non-cash stock compensation expense, restructuring expense and collaborative reimbursement revenue. This non-GAAP financial measure should not be considered a substitute or an alternative to GAAP total operating expense and should not be considered a measure of Momenta’s liquidity. Instead, non-GAAP operating expense should only be used to supplement an understanding of Momenta’s operating results as reported under GAAP. Momenta has not provided GAAP reconciliation for its forward-looking non-GAAP annual or quarterly operating expense because Momenta cannot reliably predict without unreasonable efforts the timing or amount of the factors that substantially contribute to the projection of stock compensation expense, which is excluded from the forward-looking non-GAAP financial measure. The Company has provided the estimated reconciling information that is available without unreasonable effort in the section of this press release above entitled "2019 Financial Guidance."

Conference Call Information

Management will host a conference call and webcast today at 8:30 am ET to discuss these results and provide an update on the Company. A live webcast of the conference call may be accessed on the "Investors" section of the Company’s website, www.momentapharma.com. Please go to the site at least 15 minutes prior to the call in order to register, download, and install any necessary software. An archived version of the webcast will be posted on the Momenta website approximately two hours after the call.

To access the call you may also dial (877) 224-9084 (domestic) or (720) 545-0022 (international) prior to the scheduled conference call time and provide the access code 3067995.

On October 31, 2019 Invenra Inc. reported that it has expanded its collaboration with Exelixis, Inc. (Nasdaq: EXEL) (Press release, Invenra, OCT 31, 2019, View Source [SID1234550146]). Exelixis and Invenra had entered into a collaboration on May 2nd, 2018 to discover and develop multispecific antibodies through the use of Invenra’s B-BodyTM technology platform. The new collaboration will continue to use the Invenra antibody discovery capabilities to generate additional biologics-based programs.

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"The expanded collaboration speaks to the strength and early success of the initial collaboration between Exelixis and Invenra," said Bonnie Hammer, Ph.D., Vice President of Research and Development of Invenra. "We are excited to continue to work with the Exelixis team. Both teams have demonstrated the desire to generate best-in-class therapeutics, and this expanded collaboration enables us to continue generating novel candidates for the Exelixis pipeline."

On October 31, 2019 Nuvo Pharmaceuticals Inc. (Nuvo or the Company) (TSX:NRI;OTCQX:NRIFF), a Canadian focused, healthcare company with global reach and a diversified portfolio of commercial products, reported its financial and operational results for the three and nine months ended September 30, 2019 (Press release, Nuvo Pharmaceuticals, OCT 31, 2019, View Source [SID1234550162]). For further details on the results, please refer to Nuvo’s Management, Discussion and Analysis (MD&A) and Condensed Consolidated Interim Financial Statements which are available on the Company’s website (www.nuvopharmaceuticals.com). All figures are in Canadian dollars, unless otherwise noted.

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Third Quarter Financial Summary

Adjusted total revenue(1) was $18.9 million for the three months ended September 30, 2019 compared to $5.1 million for the three months ended September 30, 2018.

Adjusted EBITDA(1) was $7.8 million for the three months ended September 30, 2019 compared to $(1.3) million for the three months ended September 30, 2018.

Gross profit on total revenue was $11.3 million or 60% for the three months ended September 30, 2019 compared to a gross profit of $2.9 million or 57% for the three months ended September 30, 2018.

Cash and short-term investments were $18.5 million as at September 30, 2019 compared to $28.1 million as at December 31, 2018. The decrease was primarily related to the settlement of transaction costs and indebtedness acquired by Nuvo upon close of the Aralez Transaction. In November 2019, the Company will make a US$2.5 million payment towards its Bridge Loan.
(1)

Non-International Financial Reporting Standards (IFRS) financial measure defined by the Company below.

Third Quarter and 2019 Business Update

Canadian prescriptions of Blexten increased by 56% for the three months ended September 30, 2019 compared to the three months ended September 30, 2018.

Canadian prescriptions of Cambia increased by 30% for the three months ended September 30, 2019 compared to the three months ended September 30, 2018.

In October 2019, the United States Court of Appeals for the Federal Circuit (Court of Appeals) issued a ruling affirming the New Jersey court’s decision upholding the validity of a certain claim of U.S. Patent No. 9,066,913 (the ‘913 Patent) which covers Pennsaid 2%. Pursuant to this decision, but subject to any appeal rights, Actavis Laboratories UT, Inc., formerly known as Watson Laboratories, Inc., Actavis, Inc. and Actavis plc (collectively Actavis) is blocked from launching its generic version of Pennsaid 2% in the United States until the ‘913 Patent expires on October 17, 2027. Nuvo is the exclusive manufacturer of Pennsaid 2% for our licensing partner, who owns the Pennsaid 2% intellectual property (IP) rights in the U.S.

In September 2019, the Company received notice from Sayre Therapeutics PVT Ltd. (Sayre Therapeutics), that the Drug Controller General of India had approved the sale of Pennsaid 2% in India. Sayre Therapeutics has the exclusive rights to distribute, market and sell Pennsaid 2% in India, Sri Lanka, Bangladesh and Nepal. The Company anticipates the commercial launch of Pennsaid 2% in India during the first quarter of 2020.

On July 30, 2019, the Court of Appeals denied the en banc request to the Court of Appeals to have the court reconsider the May 2019 decision involving U.S. Patent Nos. 6,926,907 (the ‘907 Patent) and 8,557,285 (the ‘285 Patent) which cover Vimovo. However, U.S. Patents Nos. 8,858,996 and 9,161,920 were unaffected by the Court of Appeals decision and remain valid and enforceable. A generic version of Vimovo did not launch in the U.S. during the three months ended September 30, 2019. As a result, the Company has accrued $1.7 million of license revenue related to its U.S. Vimovo royalty stream for the three months ended September 30, 2019. The Company anticipates that a generic version of Vimovo could launch in the U.S. during the fourth quarter of 2019. Nuvo and its U.S. partner will continue to consider every possible legal strategy to protect Vimovo’s market exclusivity in the U.S.

In June 2019, the Company announced its intention to reduce annual operating expenses by approximately $7.0 million due to synergies identified and organizational changes implemented. The Company began to realize these synergies during the three months ended September 30, 2019.
"Our third quarter financial performance was in-line with our expectations, with Blexten and Cambia maintaining strong year-over-year growth. In spite of the July 30, 2019 U.S. Court of Appeals decision that found that two of our Vimovo patents were invalid, we continue to enjoy market exclusivity in the U.S. and to receive the benefit of the U.S. Vimovo royalty stream. We have additional patents that were unaffected by this decision that remain valid and enforceable, which means any generic company launching a generic would do so "at risk" of having to later pay patent infringement damages should our additional patents survive validity challenges in pending patent infringement proceedings," said Jesse Ledger, Nuvo’s President & CEO. "We made advances in our pipeline with Pennsaid 2% receiving approval in India in the third quarter with the commercial launch anticipated early in 2020. The marketing authorization applications for Pennsaid 2% in Europe and Suvexx in Canada have moved beyond the initial screening phase and are now in full review with the respective government agencies. Finally, we are committed to reducing Nuvo’s financial leverage and will make a US$2.5 million payment on our Deerfield loans in November."

Third Quarter 2019 Financial Results

Total revenue is comprised of product sales, license revenue and contract revenue. Total revenue was $18.8 million for the three months ended September 30, 2019 compared to $5.1 million for the three months ended September 30, 2018. The significant increase in total revenue for the current three and nine-month periods was primarily attributable to the addition of revenue as a result of the Aralez Transaction. Total revenue for the nine months ended September 30, 2019 was $50.0 million compared to $15.4 million for the comparative nine-month period.

Adjusted total revenue increased to $18.9 million for the three months ended September 30, 2019 compared to $5.1 million for the three months ended September 30, 2018. The $13.8 million increase in adjusted total revenue in the current quarter was primarily attributable to the addition of revenue related to the Aralez Transaction, which provided an incremental $9.6 million of total revenue contributed from the Commercial Business segment and $4.0 million attributable to the Vimovo royalties related to earned Vimovo royalties. Adjusted total revenue increased to $55.1 million for the nine months ended September 30, 2019 compared to $15.7 for the nine months ended September 30, 2018.

Adjusted EBITDA increased to $7.8 million for the three months ended September 30, 2019 compared to $(1.3) million for the three months ended September 30, 2018. The increase in adjusted EBITDA for the current quarter was primarily attributable to the increase in gross profit as a result of the Aralez Transaction, as well as a reduction in general and administrative (G&A) expenses of $0.9 million, partially offset by an increase in sales and marketing of $2.0 million. Adjusted EBITDA increased to $18.7 million for the nine months ended September 30, 2019 compared to $1.4 million for the nine months ended September 30, 2018.

Gross profit on total revenue was $11.3 million or 60% for the three months ended September 30, 2019 compared to a gross profit of $2.9 million or 57% for the three months ended September 30, 2018. The increase in gross profit for the current quarter was primarily attributable to an increase in gross margin on product sales and an increase in license revenue as a result of the Aralez Transaction. Gross profit on total revenue was $30.0 million or 60% for the nine months ended September 30, 2019 compared to a gross profit of $9.0 million or 58% for the nine months ended September 30, 2018.

Non-IFRS Financial Measures
The Company discloses non-IFRS measures (such as adjusted total revenue, adjusted EBITDA and adjusted EBITDA per share) that do not have standardized meanings prescribed by IFRS. The Company believes that shareholders, investment analysts and other readers find such measures helpful in understanding the Company’s financial performance and in interpreting the effect of the Aralez Transaction and the Deerfield Financing on the Company. Non-IFRS financial measures do not have any standardized meaning prescribed by IFRS and may not have been calculated in the same way as similarly named financial measures presented by other companies.

Adjusted Total Revenue
The Company defines adjusted total revenue as total revenue, plus amounts billed to customers for existing contract assets, less revenue recognized upon recognition of a contract asset. Management believes adjusted total revenue is a useful supplemental measure from which to determine the Company’s ability to generate cash from its customer contracts that is used to fund its operations.

The following is a summary of how adjusted total revenue is calculated:

Adjusted EBITDA
EBITDA refers to net income (loss) determined in accordance with IFRS, before depreciation and amortization, net interest expense (income) and income tax expense (recovery). The Company defines adjusted EBITDA as net income before net interest expense (income), depreciation and amortization and income tax expense (recovery) (EBITDA), plus amounts billed to customers for existing contract assets, inventory step-up expense, stock-based compensation expense, Other Expenses (Income), less revenue recognized upon recognition of a contract asset and other income. Management believes adjusted EBITDA is a useful supplemental measure from which to determine the Company’s ability to generate cash available for working capital, capital expenditures, debt repayments, interest expense and income taxes.

Management to Host Conference Call/Webcast
Management will host a conference call to discuss the results today (Thursday, October 31, 2019) at 8:30 a.m. ET. To participate in the conference call, please dial 1 888 390 0546 or 416 764 8688. Please call in 15 minutes prior to the call to secure a line. You will be put on hold until the conference call begins.

A taped replay of the conference call will be available two hours after the live conference call and will be accessible until midnight on November 7, 2019 by calling 1 888 390 0541 or 416 764 8677 playback passcode 072242#.

A live audio webcast of the conference call will be available through www.nuvopharmaceuticals.com. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to hear the webcast.

On October 31, 2019 Replimune Group Inc. (NASDAQ: REPL), a biotechnology company developing oncolytic immuno-gene therapies derived from its Immulytic platform, reported it will host an investor event to review the full safety, clinical efficacy, and biomarker data from Part 1 of the Phase 1/2 clinical trial of RP1 alone and in combination with Opdivo (Press release, Replimune, OCT 31, 2019, View Source [SID1234550115]). The event will include a presentation by Robert Coffin, Ph.D., President and CEO of Replimune who will be joined by the principle investigator, Mark Middleton, MD, PhD, Professor of Experimental Cancer at the University of Oxford, and other senior members of the Replimune management team. The presentation will focus on the data being presented at SITC (Free SITC Whitepaper) as well as additional supporting data from the clinical trial.

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The presentation will begin at 6:30 p.m. Eastern Time on Friday, November 8, 2019 in National Harbor, MD.

A simultaneous webcast will be available in the Investors section of Replimune’s website at www.replimune.com. A replay will be available for 30 days following the conference.

On October 31, 2019 SignPath Pharma (Salt Lake City UT) reported the first commercial out-license of its proprietary CorreQT technology platform (Press release, SignPath Pharma, OCT 31, 2019, View Source [SID1234550147]). SignPath entered into an agreement with Rain Therapeutics (Newark CA), which licenses SignPath’s CorreQT technology for use in conjunction with Rain’s proprietary lead compound, Tarlox (tarloxotinib,) a potent pan-ErbB inhibitor in development as a treatment in various cancer indications.

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SignPath’s CorreQT technology is a novel, patented, platform that eliminates cardiac arrhythmia (QT prolongation) which is a common side effect of many drugs. The CorreQT technology has been shown to effectively eliminate these cardiac side effects without negatively impacting the efficacy or pharmacokinetics of the drug target.

"We’re excited to embark on a partnership to evaluate Signpath’s CorreQT technology," said Avanish Vellanki, chairman and chief executive officer of Rain Therapeutics. "Initial non-clinical data have been very encouraging."

The Rain/SignPath license agreement provides for payments of up to $78 million upon achievement of development and commercial milestones, along with royalties on commercial sales of Tarlox products incorporating SignPath’s CorreQT technology.

"We anticipate that this will be the first of many commercial applications of our CorreQT technology. Cardiac arrhythmia is one of the biggest obstacles to drug safety, and our technology provides a solution for creating heart safe drugs by eliminating their pro-arrhythmic side effects," said Kai Larson, CEO of SignPath. "The CorreQT technology has been successfully tested with 40 different pro-arrhythmic drug targets, including anti-depressants, antibiotics, anticancer, and other drug classes, completely eliminating QT prolongation in all of these drug targets. We believe that SignPath’s technology will become the preferred solution for addressing cardiac arrhythmia for both approved drugs and those in development."

SignPath Pharma, Inc. is a clinical stage biopharmaceutical company focused on the development of heart safe drugs for the treatment of serious diseases. The first such drug, LipoCurcTM, an anti-cancer compound, has successfully completed Phase I human clinical trials. Further clinical trials with LipoCurcTM and SPP4040, SignPath’s proprietary adjuvant for mitigating cardio-toxicity, are planned for 2020.