On August 9, 2016 Ignyta, Inc. (Nasdaq: RXDX), a biotechnology company focused on precision medicine in oncology, reported company highlights and financial results for the second quarter ended June 30, 2016 (Press release, Ignyta, AUG 9, 2016, View Source [SID:1234514455]). Ignyta will not be conducting a conference call in conjunction with this release.

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"During the second quarter, we continued to make significant advancements toward our objective of becoming a leading precision medicine oncology company and offering cancer patients potentially life-saving, precisely targeted therapeutics (Rx) guided by companion diagnostic (Dx) tests," said Jonathan Lim, M.D., Chairman and CEO of Ignyta. "For our lead program, entrectinib – our potent, CNS-active, Trk, ROS1 and ALK inhibitor – we continued to successfully execute our potentially registration-enabling Phase 2 clinical trial, STARTRK-2; announced at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting compelling results from our two Phase 1 clinical trials; and participated in a meeting of the Pediatric Oncology Subcommittee of the FDA’s Oncologic Drugs Advisory Committee. For RXDX-105 – an oral, multikinase inhibitor with potent activity against such targets as RET and BRAF – we announced interim data at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting from our Phase 1 clinical trial, highlighting its emerging safety and efficacy profile. Finally, we strengthened our balance sheet via an equity offering and term loan refinancing, providing us with the resources to continue moving rapidly to develop meaningful new therapies for the benefit of cancer patients, and we augmented our management team."

Company Highlights

Participated in FDA’s Pediatric Oncologic Drugs Advisory Committee (pedsODAC)

In June 2016, Ignyta was invited by the FDA to participate in a meeting of its pedsODAC. The meeting was intended to improve and encourage the development of oncology and hematology drugs for pediatric use. Ignyta prepared a briefing package for the meeting and the meeting’s proceeding are available in an archived webcast.

Announced Updated Entrectinib Phase 1 Data at AACR (Free AACR Whitepaper) Annual Meeting

In April 2016, updated results of the two Phase 1 clinical trials of entrectinib, the company’s proprietary oral tyrosine kinase inhibitor targeting solid tumors harboring activating alterations to NTRK1, NTRK2, NTRK3, ROS1 or ALK, were presented in an oral plenary session at the AACR (Free AACR Whitepaper) 2016 Annual Meeting in New Orleans, Louisiana.

The data cut-off for the AACR (Free AACR Whitepaper) presentation was March 7, 2016. A total of 119 patients with a range of solid tumors had been dosed across both clinical trials, with 45 patients treated at the RP2D of 600 mg, taken orally once per day (QD). Entrectinib was well tolerated across both studies and there was no evidence of cumulative toxicity, hepatic or renal toxicity, or QTc prolongation.

Among the 25 patients treated who met the company’s Phase 2 clinical trial eligibility criteria, significant tumor regression was seen in 80% (20 out of 25 treated patients).

Twenty-four patients had tumors that were evaluable by RECIST criteria. The overall confirmed response rate was 79% (19 responses, including 2 complete responses, out of 24 treated patients).
For a patient with astrocytoma, the clinical site performed three-dimensional volumetric analysis, which demonstrated an estimated 45% decrease in tumor size from baseline.
Many of these responses occurred rapidly, within the first four weeks of entrectinib treatment. Of note, durable CNS tumor regression was seen, both in patients with primary brain tumors and with metastatic disease, including one complete response.

Announced Interim Data from Phase 1 Clinical Trial of RXDX-105 at ASCO (Free ASCO Whitepaper)

In June 2016, interim data from the Phase 1 clinical trials of RXDX-105, the company’s orally available, small molecule multikinase inhibitor with potent activity against such targets as RET and BRAF, were presented at the 2016 ASCO (Free ASCO Whitepaper) Meeting in Chicago.

The Phase 1 dose escalation portion of the clinical trial was designed to determine the MTD and/or recommended RP2D, as well as preliminary anti-cancer activity, of single agent RXDX-105 in patients with advanced or metastatic solid tumors.

The data cut-off for the ASCO (Free ASCO Whitepaper) presentation was May 3, 2016. A total of 55 patients with a range of solid tumors were dosed with RXDX-105 in the clinical trial.

RXDX-105 was well tolerated. Based upon overall safety and exposure during Phase 1, the provisional RP2D was determined to be 350 mg, once daily in the fed state, and is being further evaluated in the Phase 1b portion of the study.

There were 20 patients dosed at or above the clinically relevant dose of 275 mg in the fed state, 11 of whom had an actionable RET or BRAF alteration. Tumor regression of greater than 20% was observed in four of the 20 patients, including:

an unconfirmed partial response (38% reduction) in a patient with medullary thyroid cancer with a RET M918T mutation;
a 28% reduction in target lesions in a patient with non-small cell lung cancer (NSCLC) with a BRAF D594G mutation;
a 26% reduction in target lesions in a patient with ovarian cancer with a BRAF V600E mutation; and
a confirmed partial response (40% reduction) in a patient with NSCLC with a KRAS G12C mutation, who continues on treatment after 10 cycles.
Bolstered the Balance Sheet

In May 2016, the company issued an aggregate of 9.2 million shares of its common stock in an underwritten public offering at a purchase price of $6.25 per share, which resulted in aggregate gross proceeds of $57.5 million.

In June 2016, the company secured a $42 million term loan facility from Silicon Valley Bank and Oxford Finance. Under the loan facility, the company received initial funding of $32 million, substantially all of which was used to repay the company’s prior loan with Silicon Valley Bank, and has a conditional option to receive an additional $10 million.

Enhanced Leadership Capacity

In July 2016, the company announced that Dr. Christian V. Kuhlen had been appointed to serve as its General Counsel and Secretary. Prior to joining the company, Dr. Kuhlen served as General Counsel, Vice President and Secretary of Genoptix, Inc., where he led its legal and corporate governance functions as well as its internal public policy function.

Second Quarter 2016 Financial Results

For the second quarter of 2016, net loss was $26.7 million, or $0.70 per share, compared with $13.1 million, or $0.51 per share, for the second quarter of 2015.

Ignyta did not record any revenue for the three months ended June 30, 2016 or for the three months ended June 30, 2015.

Research and development expenses for the second quarter of 2016 were $20.0 million, compared with $8.8 million for the second quarter of 2015. This increase was primarily due to the $7.7 million increase in the external development costs associated with entrectinib, taladegib and other product candidates. The remaining increase in costs between periods was due to personnel expenses related to hiring and engaging additional employees and consultants to help advance the company’s product candidates.

General and administrative expenses were $5.5 million for second quarter of 2016, compared with $3.9 million for second quarter of 2015. This increase was driven by higher personnel and share-based compensation costs, higher facilities related expenses resulting from the expansion of our leased facilities space, and increases in consulting fees and depreciation expense.

At June 30, 2016, the company had cash, cash equivalents and available-for-sale securities totaling $174.6 million and current and long-term debt of $32.0 million. At December 31, 2015, the company had cash, cash equivalents and available-for-sale securities totaling $172.1 million and current and long-term debt of $31.0 million.

On August 9, 2016 Ionis Pharmaceuticals, Inc. (Nasdaq: IONS) reported that its financial results for the first half of 2016 were in line with the Company’s expectations and the Company is on track to meet its pro forma NOL and cash guidance for the year (Press release, Ionis Pharmaceuticals, AUG 9, 2016, View Source;p=RssLanding&cat=news&id=2194067 [SID:1234514400]).

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Ionis Pharmaceuticals (PRNewsFoto/Ionis Pharmaceuticals, Inc.)
"The recent announcement to file for regulatory approval of nusinersen based on positive results from an interim analysis of the Phase 3 ENDEAR study was an important next step in our goal to bring this potentially transformational medicine to the patients who desperately need it as quickly as possible. This is the first time a potential treatment for infantile-onset SMA has demonstrated a clinical benefit in a controlled clinical study," said B. Lynne Parshall, chief operating officer of Ionis Pharmaceuticals. "We are excited about the opportunity we now have to accelerate the advancement of nusinersen into regulatory review. We and Biogen are well along in preparing the U.S. and E.U. regulatory dossiers, and Biogen plans to file marketing applications in the U.S. and E.U. in the next few months, with other countries to follow. We are very pleased that our interactions with the FDA remain very constructive as we and Biogen continue to explore possible expedited mechanisms to accelerate the regulatory review timeline."

Biogen has exercised its option to license nusinersen and will be responsible for all development, regulatory and commercialization activities and costs going forward. Over the next several months, Ionis will be working closely with Biogen to transition patients in the ENDEAR and EMBRACE studies to an open-label study that will allow all patients in these studies to have access to nusinersen. Once these patients have been transitioned into an open-label study, Biogen plans to open an expanded access program to make nusinersen available to eligible patients with infantile-onset SMA (consistent with type 1). Ionis will continue to conduct the Phase 3 CHERISH study in childhood-onset SMA patients. Biogen will also continue to conduct the NURTURE study in pre-symptomatic SMA infants.

"We believe that Biogen is the right company to bring nusinersen to patients with this devastating disease. They understand the unique needs of the SMA community and the impact SMA has on patients and their families. Importantly, Biogen has the global commercial infrastructure and expertise needed to successfully launch and commercialize nusinersen. Nusinersen is the first antisense drug from our neurological disease collaboration with Biogen that we expect to advance to regulatory review, and we are excited about the possibility of bringing other therapies to patients with severe neurological diseases with limited or no treatment options," continued Ms. Parshall.

Financial Results

"We finished the second quarter in a strong financial position. In the first half of this year, we earned $75 million of revenue, including more than $15 million in milestone payments, the majority of which were related to the progression of our Phase 3 program for nusinersen, and $15 million from Kastle when Kastle acquired the global rights to develop and commercialize KYNAMRO. Consistent with the guidance we have provided, we expect our revenue to be significantly higher in the second half of this year. We are well on our way to achieving our second half projections with the revenue we have already earned in the third quarter from the nusinersen and Janssen license fees, which total $85 million," said Elizabeth L. Hougen, chief financial officer of Ionis Pharmaceuticals.

"We have continued to advance our Phase 3 programs and to prepare to commercialize volanesorsen through Akcea while prudently managing our expenses. As a result, we finished the first half of 2016 with a GAAP loss from operations of $104 million, which included nearly $40 million in non-cash compensation expense related to equity awards, that when excluded, resulted in a pro forma net operating loss of $64 million. We also ended the first half of this year with more than $660 million in cash. Neither our operating loss nor our cash balance at June 30th included the $85 million in license fees we have earned already in the third quarter. We are on track to meet our guidance of a pro forma NOL in the low $60 million range and a year-end cash balance in excess of $600 million. Importantly, with the projected accelerated timeline for approval of nusinersen, we have the opportunity to begin earning commercial revenue next year," concluded Ms. Hougen.

All pro forma amounts referred to in this press release exclude non-cash compensation expense related to equity awards. Please refer to the reconciliation of GAAP to pro forma measures, which is provided later in this release.

Revenue

Ionis’ revenue for the three and six months ended June 30, 2016 was $38.5 million and $75.3 million, compared to $120.4 million and $183.0 million for the same periods in 2015. Ionis’ revenue in the first half of 2016 consisted of the following:

$15 million from Kastle Therapeutics in an upfront payment for KYNAMRO;
$14.5 million from Biogen for advancing the Phase 3 program for nusinersen and advancing IONIS-BIIB4Rx;
$1.5 million from GSK for advancing IONIS-HBV-LRx; and
$44.3 million primarily from the amortization of upfront fees and manufacturing services Ionis performed for its partners.
Ionis’ revenue in the first half of 2015 included $91.2 million in connection with the exclusive license agreement with Bayer, $56.8 million in milestone payments from partnered programs and $35.0 million, primarily from the amortization of upfront fees and manufacturing services Ionis performed for its partners.

Ionis’ revenue fluctuates based on the nature and timing of payments under agreements with its partners and consists primarily of revenue from the amortization of upfront fees, milestone payments and license fees. Already in the third quarter of 2016, Ionis has earned $85 million in license fee revenue consisting of $75 million from Biogen for nusinersen and $10 million from Janssen for the Company’s first oral antisense drug designed to act locally in the GI tract.

Operating Expenses
Ionis’ operating expenses included costs to support the Company’s five ongoing Phase 3 studies and three open-label extension studies related to its Phase 3 programs for nusinersen, IONIS-TTRRx and volanesorsen. In addition, Akcea continued to build its operations in preparation for the commercial launch of volanesorsen. As such, Ionis’ operating expenses increased for the three and six months ended June 30, 2016 and on a GAAP basis were $87.4 million and $178.9 million, respectively, and on a pro forma basis, were $68.1 million and $139.6 million, respectively. This is compared to GAAP operating expenses of $75.8 million and $147.7 million and pro forma operating expenses of $62.2 million and $120.8 million for the same periods in 2015. In addition, Ionis’ operating expenses on a GAAP basis increased due to an increase in non-cash compensation expense that resulted from an increase in the exercise price of the stock options the Company has granted over the past several years.

Net Income (Loss)
Ionis reported a net loss of $56.9 million and $119.8 million for the three and six months ended June 30, 2016, respectively, compared to net income of $35.6 million and $18.9 million for the same periods in 2015. Basic net loss per share for the three and six months ended June 30, 2016 was $0.47 and $0.99, respectively, compared to basic net income per share of $0.30 and $0.16 for the same periods in 2015. Diluted net loss per share for the three and six months ended June 30, 2016 was $0.47 and $0.99, respectively, compared to diluted net income per share of $0.29 and $0.15 for the same periods in 2015. Ionis had a net loss for the three and six months ended June 30, 2016 compared to net income for the same periods in 2015 primarily due to variations in the timing of revenue from license fees and milestone payments. For example, in the second quarter of 2015, the Company recognized $91.2 million in revenue related to its exclusive license agreement with Bayer.

Balance Sheet
As of June 30, 2016, Ionis had cash, cash equivalents and short-term investments of $664.1 million compared to $779.2 million at December 31, 2015. Ionis’ cash balance decreased in the first half of 2016 primarily due to spending to support the Company’s ongoing Phase 3 programs for nusinersen, IONIS-TTRRx and volanesorsen. Ionis’ working capital was $586.9 million at June 30, 2016 compared to $688.1 million at December 31, 2015. The decline in Ionis’ working capital was a result of the cash used in operations and a decline in the Company’s investment in Regulus Therapeutics resulting from a decline in Regulus’ share price. Ionis’ cash balance at June 30, 2016 did not include $85 million, comprised primarily of the $75 million from Biogen for the license of nusinersen, which it will add to its balance sheet in the third quarter.

On August 9, 2016 BioTime, Inc. (NYSE MKT:BTX), a clinical-stage regenerative medicine company with a focus on pluripotent stem cell technology, reported financial results for the second quarter ended June 30, 2016 and provided a corporate update (Press release, BioTime, AUG 9, 2016, View Source;p=RssLanding&cat=news&id=2194367 [SID:1234514456]).

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"During the second quarter, we continued to sharpen our focus on clinical progress and simplifying our corporate structure," said Adi Mohanty, Co-Chief Executive Officer. "Our key therapeutic programs, Renevia in medical aesthetics and OpRegen in dry AMD, continue to advance in the clinic, and we expect additional meaningful milestones from these programs in the second half of 2016. Meanwhile, our public subsidiaries continue to demonstrate their ability to make solid clinical progress. We strengthened our balance sheet by completing a successful public equity offering with gross proceeds of approximately $20.1 million from new and existing investors. Additionally, as we previously announced in May, we have deconsolidated Asterias Biotherapeutics, Inc. from our financial statements as result of its recent financing. We continue to see Asterias playing an important role in furthering therapies based on pluripotent stem cell technology. Asterias will continue to file its own financial statements with the SEC, allowing our shareholders to continue to follow its financial progress."

Second Quarter and Recent Highlights

Clinical Progress

Renevia (adipose cells + cell delivery matrix)

The Renevia pivotal clinical trial for HIV-related facial lipoatrophy continues to enroll new patients and is on track to complete patient enrollment by the second half of 2016. The objective of the trial is to assess the efficacy of Renevia in restoring normal skin contours in patients whose subcutaneous fat has been lost due to antiviral drug treatment for HIV. The Company expects top-line efficacy data in the first half of 2017, and plans to submit an application for CE Mark approval in Europe in the first half of 2017 if the data are positive. Positive data from the pivotal trial could provide support for future studies of Renevia in certain broader applications of fat tissue deficits in various medical aesthetics applications, such as age-related and trauma-related facial fat loss.
OpRegen (retinal pigment epithelial cells)

In June, the Data Safety Monitoring Board (DSMB) for the OpRegen Phase I/IIa clinical trial for the treatment of the advanced form of dry age-related macular degeneration (AMD) completed its review of the initial safety data from the first cohort and recommended dose escalation to the second cohort. Enrollment has begun for the second patient cohort, which is receiving a higher, more clinically significant, dose of OpRegen cells. The Company expects completion of enrollment for the second cohort in 2016 and, if the data are positive, anticipates DSMB approval to proceed to the third cohort by the end of 2016. OpRegen has received Fast Track designation from the U.S. Food and Drug Administration for the treatment of dry AMD, which occurs in approximately 90% of those afflicted with AMD.
AST-OPC1 (oligodendrocyte progenitor cells)

In July, enrollment and dosing of the first efficacy cohort was completed in the AST-OPC1 SCiSTAR Phase 1/2a clinical trial in complete cervical spinal cord injury. This is the second of three cohorts in the study and it represents the first cohort in which patients have been administered a dose high enough to fall within the potentially efficacious range predicted by preclinical studies conducted by Asterias. Top-line six-month efficacy and safety results from this patient cohort are expected in January 2017. As of May 13, 2016, BioTime owned approximately 49% of the common shares outstanding of Asterias Biotherapeutics (NYSE MKT:AST).
Cancer Diagnostics

OncoCyte Corporation (NYSE MKT:OCX), the cancer diagnostics subsidiary of BioTime and developer of novel, non-invasive blood and urine based tests for the early detection of cancer, presented positive data from a clinical study for the non-invasive detection of bladder cancer at the 2016 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting. Interim data from the clinical study, which was first reported at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) 2015 Annual Meeting, demonstrated a high level of sensitivity and specificity in the detection of urothelial carcinoma, the most common type of bladder cancer.
Corporate Developments

In June, BioTime closed a public offering of shares of its common stock. In July, the underwriters exercised in full their over-allotment option. Gross proceeds of the offering and full exercise of the over-allotment option totaled approximately $20.1 million, before deducting underwriting discounts and commissions and other offering expenses payable by BioTime.
On May 13, 2016, BioTime deconsolidated its former majority-owned subsidiary, Asterias Biotherapeutics, Inc. As result, Asterias’ financial statements for periods after May 12, 2016 are no longer included in BioTime’s consolidated financial statements, and BioTime is now accounting for its investment in Asterias at fair value based on the closing stock price of Asterias common stock on the NYSE MKT and the number of shares held by BioTime. Changes in the fair value of Asterias common stock are reflected as unrealized gains or losses in BioTime’s consolidated statements of operations, as a non-operating item. See Second Quarter Financial results below.
Second Quarter Financial Results

Note on deconsolidation of Asterias and comparability of results:

BioTime’s consolidated balance sheet at December 31, 2015, as reported, included Asterias’ assets and liabilities. However, Asterias’ assets and liabilities are not included in BioTime’s consolidated balance sheet at June 30, 2016 due to the deconsolidation of Asterias on May 13, 2016. Furthermore, BioTime’s consolidated statements of operations for the three and six months ended June 30, 2016 include Asterias’ results for the period through May 12, 2016, the day immediately preceding the deconsolidation. For the three and six months ended June 30, 2015, BioTime’s consolidated results include Asterias’ results for the full periods presented.

All discussions about the results of operations, or balance sheet amounts that follow, as appropriate and indicated, include both the actual results and amounts pertaining to Asterias.

Cash Position and investments: Cash and cash equivalents totaled $27.7 million as of June 30, 2016, compared to $42.2 million as of December 31, 2015, which included Asterias’ cash and cash equivalents of $11.2 million. The cash on hand as of June 30, 2016 includes $7.0 million held by subsidiaries and excludes Asterias due to the deconsolidation. As of June 30, 2016, BioTime owned 21.7 million shares of Asterias common stock and 14.7 million shares of OncoCyte common stock, which represented an aggregate market value of approximately $104 million as of that date. On June 21, 2016, BioTime closed a $17.5 million public offering of shares of its common stock. On July 5, 2016, BioTime announced the exercise in full of the underwriters’ over-allotment option to purchase an additional 1,098,326 shares of BioTime common stock. The gross proceeds of the offering, including the over-allotment option were approximately $20.1 million before deducting underwriting discounts and commissions and other offering expenses payable by BioTime.

Revenues: BioTime’s operating revenues are currently primarily generated from research grants, licensing fees and advertising from the marketing of online database products. Total consolidated revenues were $1.3 million for the second quarter, compared to $2.0 million in the second quarter of 2015. Asterias’ total revenues included in the second quarter of 2016 and 2015 were $0.8 million in each respective period as shown in the table below (in thousands).

Three months ended June 30, 2016

Three months ended June 30, 2015
Consolidated
Results of
Operations

Less: Asterias
(42 days)

Consolidated
Results less
Asterias

Consolidated
Results of
Operations

Less: Asterias
(3 months)

Consolidated
Results less
Asterias

Total revenues $ 1,266 $ 760 $ 506 $ 2,009 $ 772 $ 1,237

The decrease in BioTime’s total revenues was mainly due to less grant revenue recorded in 2016 due to expiration of a National Institutes of Health (NIH) grant in August 2015.

Operating Expenses (in thousands)

Three months ended June 30, 2016

Three months ended June 30, 2015
Consolidated
Results of
Operations

Less: Asterias
(42 days)

Consolidated
Results less
Asterias

Consolidated
Results of
Operations

Less: Asterias
(3 months)

Consolidated
Results less
Asterias

Research and development $ 8,938 $ 2,343 $ 6,595 $ 9,059 $ 3,696 $ 5,363
General and administrative 6,636 1,357 5,279 6,186 1,845 4,341

R&D Expenses: Research and development expenses were $8.9 million for the second quarter, compared to $9.1 million for the comparable period in 2015, including $2.3 million and $3.7 million attributable to Asterias’ research and development for the respective periods.

The increase in R&D of approximately $1.2 million is in part a result of increased expenses primarily related to regulatory and clinical trials of BioTime’s Renevia program and OncoCyte’s cancer diagnostics, offset by a decrease of approximately $1.3 million principally due to the deconsolidation of Asterias.

G&A Expenses: General and administrative expenses were $6.6 million for the second quarter, compared to $6.2 million for the second quarter of 2015, including $1.4 million and $1.8 million attributable to Asterias for the same periods, respectively. The $0.9 million increase is in part a result of increased staffing needed to advance programs under development at BioTime, including non-cash stock-based compensation from BioTime and OncoCyte, offset by a $0.5 million decrease due to the deconsolidation of Asterias.

Net Income attributable to BioTime: Net income attributable to BioTime was $24.5 million for the three months ended June 30, 2016, or $0.26 per share primarily due to the $49.0 million noncash gain on deconsolidation of Asterias, offset by unrealized losses of $13.5 million from the decline in the fair value of the Asterias shares owned by BioTime that occurred during the period May 13 through June 30, 2016. There was no deferred income tax provision or benefit recorded in the three months ended June 30, 2016. For the second quarter of 2015, net loss attributable to BioTime was $9.7 million, or ($0.12) per share. Net income (loss) attributable to BioTime includes losses from BioTime’s majority owned and consolidated subsidiaries based upon BioTime’s percentage ownership of those subsidiaries.

On August 9, 2016 Caladrius Biosciences, Inc. (NASDAQ: CLBS) ("Caladrius" or the "Company"), a cell therapy company combining an industry-leading development and manufacturing services provider through its subsidiary PCT, LLC a Caladrius Company ("PCT") with a select therapeutic development pipeline, reported financial results for the three and six months ended June 30, 2016 (Press release, Caladrius Biosciences, AUG 9, 2016, View Source [SID:1234514498]).

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Business highlights for the second quarter and recent weeks include:

•Achieved total revenues of $8.3 million for the second quarter of 2016, up 41% compared with $5.9 million in the second quarter of 2015;
•Achieved total operating costs and expenses reduction of 50% in the second quarter of 2016 when compared with the second quarter of 2015;
•Granted Fast Track designation from the U.S. Food and Drug Administration ("FDA") for CLBS03 for the treatment of recent onset type 1 diabetes mellitus ("T1D"), making it the first known therapeutic candidate to receive Fast Track designation for treatment of T1D;
•Granted Orphan Drug designation from the FDA for CLBS03 for the treatment of T1D with residual beta cell function;
•Expanded PCT’s relationship with Kiadis Pharma with an agreement for the manufacturing of their lead product, ATIR101, for the U.S. and Canadian Phase 3 trial in blood cancers;
•Announced the appointment of Robert A. Preti, Ph.D., the Company’s Chief Technology Officer, Senior Vice President, Manufacturing and Technical Operations, and President of PCT, as Chairman of the Alliance for Regenerative Medicine ("ARM"), the international advocacy organization representing the gene and cell therapies and broader regenerative medicine sector; and
•Licensed exclusive global rights to the Company’s tumor cell/dendritic cell technology for the treatment of ovarian cancer to AiVita Biomedical, Inc. In return, Caladrius will receive certain development milestone payments as well as royalties on sales.

Management Commentary

"We remain very pleased with our year-to-date performance as we continue to deliver on our strategic goals to grow and expand the PCT business, to reduce expenses, to advance our Phase 2 T-Rex clinical trial as a treatment for T1D and to monetize non-core assets," stated David J. Mazzo, Ph.D., Chief Executive Officer of Caladrius. "We are delighted to add Fast Track and Orphan Drug designations to CLBS03 for the treatment of T1D as they underscore the significant unmet medical need in this degenerative disease, and provide regulatory provisions that can accelerate the review process and expand our market exclusivity. We look forward to completing enrollment and treatment of the first cohort of approximately 18 patients toward the end of summer. Following the three-month post-treatment visit, an interim safety analysis will be conducted, and we expect to have these results by year-end 2016."

"We entered the second half of 2016 in a solid position to continue advancing our strategic goals and achieving our financial guidance for the year. We are delighted that a growing number of cell therapy developers are partnering with PCT to take advantage of our expertise and our quality, scalable, innovative, reliable and cost-efficient manufacturing platforms and services to advance their cellular therapies."

"Our leadership in regenerative and cell therapy was further solidified with the appointment of Dr. Robert Preti as Chairman of ARM. As a pioneer in cell therapy manufacturing and development, Dr. Preti remains at the forefront of the industry, influencing regulatory trends and policy making. ARM’s dedication to advancing regenerative medicine and cell therapies and to bringing its stakeholders together is unprecedented, and aligns with PCT’s vision of contributing to a world in which transformative cell-based therapeutics are accessible to all patients in need," concluded Dr. Mazzo.

Second Quarter Financial Highlights

Total revenues for the second quarter of 2016 increased 41% to $8.3 million compared with $5.9 million for the second quarter of 2015. Gross margin on revenues was 15% in the second quarter of 2016 compared with 1% in the second quarter of 2015.

Research and development (R&D) expenses for the second quarter of 2016 decreased 47% to $4.0 million compared with $7.6 million for the second quarter of 2015. The decrease was primarily related to lower costs subsequent to the discontinuation of the Intus Phase 3 clinical trial for metastatic melanoma as well as lower program expenses associated with the Company’s ischemic repair platform, compared with the prior-year period. These decreases were partially offset by an increase in expenses related to The Sanford Project: T-Rex Phase 2 Study in T1D.

Selling, general and administrative (SG&A) expenses decreased 46% to $4.7 million for the second quarter of 2016 compared with $8.7 million for the same period in 2015. The decrease is due to both lower equity-based compensation costs and operational and compensation-related cost reductions compared to the prior year period.

The operating loss for the second quarter of 2016 was $7.5 million compared with an operating loss of $25.7 million for the second quarter of 2015, reflecting higher revenues and gross margin, and lower R&D and SG&A expenses, as well as an impairment of intangible assets in the second quarter of 2015.

The Company reported a net loss for the second quarter of 2016 of $7.9 million, or $1.33 per share, compared with a net loss for the second quarter of 2015 of $17.2 million, or $3.84 per share.

First Half Financial Highlights

Total revenues for the six months ended June 30, 2016 increased 75% to $15.8 million compared with $9.0 million for the first six months of 2015. Gross margin for the first half of 2016 was 16% compared with a negative 1% for the first half of 2015.

R&D expenses for the first half of 2016 decreased to $9.9 million compared with $14.4 million for the first half of 2015. SG&A expenses decreased to $11.2 million for the first half of 2016 compared with $19.8 million for the same period in 2015. The first half of 2015 included expenses associated with executive management changes including one-time new hire compensation-related costs. The first half of 2016 included separation-related costs incurred during the first quarter of 2016, while equity-based compensation expenses were significantly lower in the first half of 2016 compared to the prior year period.

The operating loss for the first half of 2016 was $18.6 million compared with an operating loss of $43.8 million for the first half of 2015.

The net loss for the six months ended June 30, 2016 was $19.9 million, or $3.39 per share, compared with a net loss for the six months ended June 30, 2015 of $36.4 million, or $8.83 per share.

Balance Sheet and Cash Flow Highlights

As of June 30, 2016, Caladrius had cash and cash equivalents of $17.7 million. Net cash used in operating activities for the six months ended June 30, 2016 was $14.6 million, compared with $21.8 million for the six months ended June 30, 2015.

2016 Financial Guidance

The Company reaffirms its previous guidance as follows:

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Consolidated Revenues: to exceed $30 million or a greater than 30% increase compared with 2015
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Capital Improvements at PCT’s Allendale, NJ facility: ~$6 million, to be completed by end of first half of 2017
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CLBS03 Phase 2 Study Costs in 2016: $6 million to $7 million
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Consolidated Annual Operating Cash Burn: $25 million to $28 million in 2016, with lower operating cash burn in the second half of 2016 than in the first half of the year

On August 9, 2018 The Board of Directors (the ‘‘Board’’) of Luye Pharma Group Ltd. (the ‘‘Company’’, together with itssubsidiaries, the ‘‘Group’’) reported that the Group’s product candidate, Goserelin Acetate Extended Release Microspheres for Injection (LY01005), has obtained the approval from the China Food and Drug Administration (the ‘‘CFDA’’) to initiate clinical trials for the treatment ofcarcinoma of the prostate (Press release, Luye Pharma, AUG 9, 2016, View Source;id=663103 [SID1234525075]). This product has also obtained the approval from the United States Food and Drug Administration (the ‘‘FDA’’) to initiate clinical trials for the treatment of carcinoma of theprostate in March this year.

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LY01005 is the Group ’s monthly extended release microspheres for intramuscular formulation ofgoserelin acetate, a gonadotropin -releasing hormone agonist, applying our microspheres injection technology. It is an oncology product candidate for the treatment of certain cancers and other indications, including prostate cancer, breast cancer and endometriosis. LY01005 is now being registered via a 505(b)(2) pathway of the United States Federal Food, Drug and Comestic Act in the United States ( ‘‘U.S.’’). The Company believes its extended-release microspheres formulation ofgoserelin acetate may have similar bioavailability as compared to another marketed product (goserelin implant), with better patient compliance and more stable efficacy.

The Company had filed a Patent Cooperation Treaty application for its goserelin microsphere pharmaceutical composition in 2014 and such PCT application entered into the U.S., Europe, Japan and certain other countries in 2015.

According to IMS Health Incorporated, the market size for gonadotropin -releasing hormone agonist products in China in 2015 was approximately RMB2.79 billion, and grew at a compound annual growth rate of 21.6% from 2013 to 2015. The Company believes that LY01005 has a good marketing potential – 1 – and will provide an impetus to the Group ’s development in the oncology therapeutic area. In addition toChina and the U.S., the Company is also targeting to obtain clinical trial approval for this potential new drug in Europe and Japan.

Apart from LY01005, the Company is currently developing several new pharmaceutical products both in China and the U.S., including Risperidone Extended Release Microspheres for Injection (LY03004 ), which had been confirmed by the FDA for New Drug Application for submission in the U.S. without additional clinical trials, Rotigotine Extended Release Microspheres for Injection (LY03003 ), which had completed phase I trials in the U.S. and Ansofaxine Hydrochloride Extended Release Tablets (LY03005 ) which had also completed phase I trials in the U.S.