On August 03, 2016 Loxo Oncology, Inc. (Nasdaq:LOXO), a biopharmaceutical company innovating the development of highly selective medicines for patients with genetically defined cancers, reported financial results for the second quarter ended June 30, 2016 (Press release, Loxo Oncology, AUG 3, 2016, View Source [SID:1234514192]). Loxo Oncology will not be conducting a conference call in conjunction with this earnings release.

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"We had a productive second quarter," said Josh Bilenker, M.D., chief executive officer of Loxo Oncology. "In April, we provided an important durability update for our adult Phase 1 LOXO-101 trial at AACR (Free AACR Whitepaper), and published our first pediatric response to LOXO-101 in a peer-reviewed journal. In May, we added new investors with a follow-on financing. In June, we presented data on our pediatric formulation and development plans to an FDA advisory committee, in a public forum. And just after the close of the quarter, we secured Breakthrough Therapy Designation for LOXO-101 from the FDA."

Recent Highlights

LOXO-101 Received Breakthrough Therapy Designation: In July, the U.S. Food and Drug Administration (FDA) granted Breakthrough Therapy Designation to LOXO-101 "for the treatment of unresectable or metastatic solid tumors with NTRK-fusion proteins in adult and pediatric patients who require systemic therapy and who have either progressed following prior treatment or who have no acceptable alternative treatments."
LOXO-101 Selected for FDA Pediatric Advisory Committee Meeting: In June, Loxo Oncology participated in a meeting of the FDA’s Pediatric Oncology Subcommittee of the Oncologic Drugs Advisory Committee. The purpose of the meeting was to improve and encourage the development of oncology and hematology drugs for pediatric use. A replay of that presentation is available. Loxo Oncology also submitted a briefing package in advance of this meeting, which is publicly available.
Strengthened Balance Sheet: Loxo Oncology raised $41.4 million in gross proceeds in an equity financing in May 2016. Loxo Oncology’s cash, cash equivalents and investments are expected to be sufficient to fund operations into late 2018.
LOXO-101 Update at AACR (Free AACR Whitepaper) and Pediatric Case Report: In April, investigators provided an update of the Phase 1 adult trial of LOXO-101, highlighting patients with TRK fusion cancers. Of note from the presentation, all responding patients remained in response, all had shown evidence of tumor regression, and five of six patients had achieved a confirmed partial response (PR) by standard RECIST criteria. Importantly, five of these six patients were treated at or below the recommended Phase 2 dose. Separately, investigators also published a peer-reviewed case report of the first pediatric patient treated with a liquid formulation of LOXO-101 in the setting of infantile fibrosarcoma. The patient achieved a confirmed partial response and began again to achieve appropriate developmental milestones.
Upcoming Milestones

Loxo Oncology continues to make significant progress across its drug development pipeline. Upcoming milestones are expected to include:

Continued enrollment of the LOXO-101 NAVIGATE Phase 2 global, multi-center, single-arm, open-label basket trial in adult patients with solid tumors that harbor a TRK fusion. Loxo Oncology plans to provide an enrollment update in the second half of 2016.
Initiation of a Phase 1 study of a selective RET inhibitor in late 2016/ early 2017.
Initiation of a Phase 1 study of next-generation TRK inhibitor LOXO-195, addressing previously treated patients with acquired resistance, in 2017. Loxo Oncology may provide access to LOXO-195 for emergency investigational use prior to 2017 if medically necessary, requested by a treating clinician, and authorized by the appropriate regulatory authorities. LOXO-195 is designed to retain potency against a common resistance mutation that has been described in two separate patients who have progressed on a competitor’s TRK inhibitor.
Second Quarter 2016 Financial Results

As of June 30, 2016, Loxo Oncology had aggregate cash, cash equivalents and investments of $171.7 million, compared to $153.9 million as of December 31, 2015.

Loxo Oncology continues to expect cash burn of $48 to $52 million in 2016. Based on the current operating plan, the company believes existing capital resources will be sufficient to fund anticipated operations into late 2018.

Research and development expenses were $12.3 million for the second quarter of 2016 compared to $5.7 million for the second quarter of 2015. This increase was primarily due to expanded clinical development activities for LOXO-101, as well as additional expenses related to the preclinical pipeline. Loxo Oncology also recognized research and development-related stock-based compensation expense of $0.2 million during the second quarter of 2016, compared to $0.9 million for the second quarter of 2015.

Research and development expenses were $20.7 million for the six months ended June 30, 2016, compared to $9.5 million for the six months ended June 30, 2015. This increase was primarily due to expanded clinical development activities for LOXO-101, as well as additional expenses related to the preclinical pipeline. Loxo Oncology also recognized research and development-related stock-based compensation expense of $0.5 million during the six months ended June 30, 2016, compared to $1.3 million for the six months ended June 30, 2015.

General and administrative expenses were $3.8 million for the second quarter of 2016 compared to $2.4 million for the second quarter of 2015. This increase was primarily attributable to employment costs and professional fees. Loxo Oncology also recognized general and administrative-related stock-based compensation expense of $1.1 million during the second quarter 2016, compared to $0.8 million for the second quarter 2015.

General and administrative expenses were $7.2 million for the six months ended June 30, 2016, compared to $4.8 million for the six months ended June 30, 2015. This increase was primarily attributable to employment costs and professional fees. Loxo Oncology also recognized general and administrative-related stock-based compensation expense of $2.1 million during the six months ended June 30, 2016, compared to $1.3 million for the six months ended June 30, 2015.

Net loss was $15.9 million and $27.5 million for the three and six months ended June 30, 2016, respectively, compared to $8.1 million and $14.2 million for the three and six months ended June 30, 2015, respectively.

About LOXO-101
LOXO-101 is a potent, oral and selective investigational new drug in clinical development for the treatment of patients with cancers that harbor abnormalities involving the tropomyosin receptor kinases (TRKs). Growing research suggests that the NTRK genes, which encode for TRKs, can become abnormally fused to other genes, resulting in growth signals that can lead to cancer in many sites of the body. In an ongoing Phase 1 clinical trial, LOXO-101 has demonstrated encouraging preliminary efficacy. LOXO-101 is also being evaluated in the NAVIGATE global Phase 2 multi-center basket trial in patients with solid tumors that harbor TRK gene fusions and the SCOUT Phase 1 trial in pediatric patients including infantile fibrosarcoma. LOXO-101 has been granted Breakthrough Therapy Designation by the U.S. FDA. For additional information about the LOXO-101 clinical trials, please refer to www.clinicaltrials.gov. Interested patients and physicians can contact the Loxo Oncology Physician and Patient Clinical Trial Hotline at 1-855-NTRK-123 or visit www.loxooncologytrials.com.

On August 3, 2016 Vitae Pharmaceuticals, Inc. (NASDAQ:VTAE), a clinical-stage biotechnology company, reported its operating and financial results for the quarter ended June 30, 2016 (Press release, Vitae Pharmaceuticals, AUG 3, 2016, View Source;p=irol-newsArticle&ID=2192602 [SID:1234514222]).

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Jeff Hatfield, President and Chief Executive Officer of Vitae, commented, "During the quarter, we made significant progress towards the completion of two key milestones for Vitae. First, we are on track to report top-line results for the ongoing Phase 2a proof-of-concept study for VTP-38543, our wholly owned, potential first-in-class LXRβ selective agonist being developed for atopic dermatitis, in the fourth quarter of 2016. Second, we continue to finalize plans for the next clinical trial, expected to initiate in the fourth quarter of 2016, of VTP-43742, our wholly owned, first-in-class RORyt inhibitor, in psoriasis patients. Previously, VTP-43742 demonstrated results that validated RORyt as a therapeutic target for psoriasis and VTP-43742 as a potentially paradigm-changing therapeutic."

Quarterly and Recent Highlights

Pipeline Updates:

VTP-38543 in Atopic Dermatitis

Continued enrollment in its Phase 2a proof-of-concept clinical trial of VTP-38543 in atopic dermatitis. This four-week, randomized, double-blind, placebo-controlled Phase 2a trial will assess the safety, tolerability, efficacy, pharmacokinetics and pharmacodynamics of multiple ascending topical doses of VTP-38543 in approximately 100 adult patients with mild to moderate atopic dermatitis. Vitae expects to report top-line efficacy results in the fourth quarter of 2016.
VTP-43742 in Autoimmune Disorders

Continued preparations for an upcoming Phase 2 clinical trial of VTP-43742 in psoriasis patients. Vitae plans to advance VTP-43742 into a 16-week Phase 2 trial in the fourth quarter of 2016 with the objectives of: (1) assessing the 16-week efficacy of VTP-43742 in moderate to severe psoriasis patients; (2) assessing the safety of the product candidate in a larger population and over a longer treatment period; and (3) positioning VTP-43742 to begin pivotal trials as soon as practicable after the completion of the Phase 2 clinical trial, if successful. Vitae expects to report top-line data from this trial in the second half of 2017.
VTP-45489 in Autoimmune Disorders

Vitae is advancing VTP-45489, its second RORyt inhibitor, into the clinic. Vitae expects to initiate a Phase 1 single ascending dose clinical trial in normal healthy volunteers during the third quarter of 2016.
New Contour Program

Animal proof-of-principle achieved in a new target program. Initial lead candidate selected to advance into preclinical development.
Corporate Update:

Appointed Carole Sable, M.D., as Chief Medical Officer. Dr. Sable will oversee the clinical development of Vitae’s pipeline, including VTP-43742 and VTP-38543. Dr. Sable brings to Vitae more than 20 years of diverse clinical development and executive management experience, having been involved in all phases of clinical research.

Appointed Daniel M. Junius to Vitae’s Board of Directors. Mr. Junius recently retired as President and Chief Executive Officer of ImmunoGen, Inc. and brings both executive and prior board experience to Vitae’s Board of Directors.
Financial Results:

Operating Expense. Total operating expenses for the second quarter of 2016 were $10.5 million, compared with $10.0 million for the second quarter of 2015.
Research and development expenses were $7.9 million for the second quarter of 2016, compared with $7.8 million for the second quarter of 2015. The slight increase was largely attributable to expenses related to preclinical programs, the atopic dermatitis program, discovery efforts, stock-based compensation and compensation expense, partially offset by reduced manufacturing expenses resulting from the timing of development activities for the RORyt program.
General and administrative expenses were $2.7 million for the second quarter of 2016, compared with $2.3 million for the second quarter of 2015. The increase was primarily due to an increase in legal fees, patent related expenses, stock-based compensation expense and compensation expenses.

Net Loss. Vitae reported a net loss of $10.4 million, or $0.36 per diluted share, for the second quarter of 2016, compared with a net loss of $9.8 million, or $0.45 per diluted share, for the second quarter of 2015. The increase in net loss was primarily due to the increase in general and administrative expenses.

Cash Position. As of June 30, 2016, Vitae had $77.4 million in cash, cash equivalents and marketable securities, compared with $59.4 million as of December 31, 2015. The increase in cash position was primarily a result of the completion of a follow-on public offering in March 2016, partially offset by cash outflows used in operating activities. Based on its current business plan, Vitae believes that its existing cash, cash equivalents and marketable securities will be sufficient to fund its projected operating requirements into the second half of 2018.
Expected Upcoming Events

VTP-38543 in Atopic Dermatitis – Top-line proof-of-concept results from a Phase 2a clinical trial in mild to moderate atopic dermatitis patients in the fourth quarter of 2016.

VTP-43742 in Autoimmune Disorders – Initiation of a 16-week Phase 2 trial in the fourth quarter of 2016.

VTP-45489 in Autoimmune Disorders – Initiation of a Phase 1 single ascending dose trial in the third quarter of 2016.

On August 3, 2016 Dr. Reddy’s Laboratories Ltd. (BSE: 500124) (NSE: DRREDDY) (NYSE: RDY) reported that it successfully completed the previously announced acquisition of eight Abbreviated New Drug Applications (ANDAs) in the U.S. from Teva Pharmaceutical Industries Ltd. (NYSE: TEVA) (TASE: TEVA) and an affiliate of Allergan plc (NYSE: AGN) (Press release, Dr Reddy’s, AUG 3, 2016, View Source [SID:1234514225]). The acquired portfolio consists of products that are being divested by Teva as a precondition to its closing of the acquisition of Allergan’s generics business.

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The portfolio being acquired is a mix of six ANDAs pending approval, one approved ANDA and one ANDA with tentative approval, and comprises complex generic products across diverse dosage forms. The combined sales of the branded versions of the products in the U.S. is approximately $3.5 billion MAT for the most recent twelve months ending in June 2016 according to IMS Health*. The products include Buprenorphine HCl/Naloxone HCl Sublingual Film (generic equivalent to Suboxone sublingual film), Ethinyl estradiol/Ethonogestrel Vaginal Ring (generic equivalent to NuvaRing), Ezetimibe/Simvastatin Tablets (generic equivalent to Vytorin), Metformin HCl/Saxagliptin ER Tablets (generic equivalent to Kombiglyze XR), Tobramycin Inhalation Solution (generic equivalent to Tobi), Phentermine HCl/Topiramate ER Capsules (generic equivalent to Qsymia), Imiquimod Topical Cream (generic equivalent to Zyclara 3.75% Cream), and Ramelteon Tablets (generic equivalent to Rozerem).

*IMS National Sales Perspectives: Retail and Non-Retail MAT June 2016

Under the terms with TEVA, Allergan retains the branded pharma business and medical aesthetic business, as well as its biosimilars development programs, including its collaboration with Amgen Inc, inherited in the 2012 merger of Actavis with Watson Pharmaceuticals) (Article, BioWorld, AUG 3, 2016, View Source [SID1234516258]).
President and CEO Brent Saunders said biosimilars remain a strategic fit for the company, adding that "we made substantial investments over the years that will pay out" in the future, both in terms of the Amgen collaboration and Allergan’s internal biosimilars programs

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On August 3, 2016 ArQule, Inc. (Nasdaq: ARQL) reported its financial results for the second quarter of 2016 (Press release, ArQule, AUG 3, 2016, View Source [SID:1234514200]).

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For the quarter ended June 30, 2016, the Company reported a net loss of $5,100,000 or $0.07 per share, compared with a net loss of $4,017,000 or $0.06 per share, for the second quarter of 2015. For the six-month period ended June 30, 2016, the Company reported a net loss of $10,081,000 or $0.15 per share, compared with a net loss of $8,568,000 or $0.14 per share, for the six-month period ended June 30, 2015.

At June 30, 2016, the Company had a total of approximately $43,115,000 in cash, equivalents and marketable securities.

Key Highlights

ARQ 087, our proprietary FGFR inhibitor, demonstrated strong anticancer activity in an ongoing phase 1/2 trial in intrahepatic cholangiocarcinoma (iCCA), a rare form of liver cancer. A 75% disease control rate, including a 25% objective response rate, was observed from the preliminary data presented at the 2016 ESMO (Free ESMO Whitepaper) GI Congress. Since the Congress presentation, a fourth partial response has been observed.
ARQ 531, our proprietary and novel BTK inhibitor, demonstrated in preclinical studies that it is a potent and reversible inhibitor of both wild type and ibrutinib resistant C481S-mutant BTK. In preclinical testing, ARQ 531 demonstrated biochemical inhibition of both wild type and C481S-mutant BTK at sub-nanomolar levels and potent cellular inhibition in C481S-mutant BTK cells that are resistant to ibrutinib. These data were presented at the 2016 Pan Pacific Lymphoma Conference in July marking the first public showing of data on this potential best-in-class molecule.
ARQ 092, our lead AKT inhibitor, continues in the phase 1 trial for Proteus syndrome. The three patients enrolled in the first cohort are approaching nine months of therapy.
Tivantinib – METIV-HCC phase 3 trial in hepatocellular carcinoma is scheduled to conclude by year-end 2016 or early 2017. Top-line data is expected according to that timeline.
"We are starting to realize the benefits of our precision medicine strategy through the advancement of our proprietary pipeline as evidenced by the strong clinical data recently presented at ESMO (Free ESMO Whitepaper) GI for ARQ 087 in iCCA, the initiation of a biomarker driven phase 1 trial for our next generation AKT inhibitor, ARQ 751, and the emerging preclinical profile of our novel BTK inhibitor, ARQ 531, recently presented at the Pan Pacific Lymphoma Conference," said Paolo Pucci, Chief Executive Officer of ArQule. "While AKT and FGFR are emerging targets, with ARQ 531 we have the opportunity to work in a well-established target such as BTK and to address a growing therapeutic need of patients who develop resistance to ibrutinib. We look forward to sharing additional data on ARQ 087, ARQ 092 and ARQ 531 later this year."

"With the four partial responses recorded thus far in the iCCA trial, we are nearing a decision for the next stage of clinical development for ARQ 087 and expect to meet with regulatory authorities in the near future," said Dr. Brian Schwartz, M.D., Head of Research and Development and Chief Medical Officer at ArQule. "The initiation of a pivotal biomarker driven trial in iCCA with FGFR2 genetic alterations would create an opportunity for a fast-to-market strategy in this orphan disease. With clear signs of clinical utility and a manageable safety profile, ARQ 087 has the potential to become a best-in-class compound."

Revenues and Expenses

Revenues for the quarter ended June 30, 2016, were $1,072,000 compared with revenues of $3,004,000 for the quarter ended June 30, 2015. Revenues in the six-months ended June 30, 2016 were $2,299,000 compared with revenues of $5,789,000 in the six-months ended June 30, 2015. Revenue in the three and six-month periods of 2016 and 2015 is comprised of revenue from the Daiichi Sankyo tivantinib development agreement and the Kyowa Hakko Kirin exclusive license agreement.

The revenue decreases in the quarter ended June 30, 2016 of $1.0 million from our Daiichi Sankyo METIV-HCC trial and $0.9 million from our Kyowa Hakko Kirin JET-HCC trial were principally due to the March 2016 extension of the development period through December 31, 2016 for both programs. The revenue decreases in the six months ended June 30, 2016 of $1.6 million from our Daiichi Sankyo METIV-HCC trial and $1.9 million from our Kyowa Hakko Kirin JET-HCC trial were also principally due to the extension of the development period through December 31, 2016.

Research and development expense in the second quarter of 2016 was $4,337,000, compared with $4,327,000 for the second quarter of 2015. The increase in outsourced clinical and product development costs of $0.4 million in the second quarter of 2016 was offset by lower labor and related costs of $0.3 million and facility costs reductions of $0.1 million.

Research and development expense in the six-months ended June 30, 2016 was $8,535,000 compared with $8,740,000 in the six-months ended June 30, 2015. The $0.2 million decrease in research and development expense in the six-months ended June 30, 2016 was primarily due to lower labor and related costs of $0.5 million, facility costs of $0.5 million, partially offset by increased outsourced clinical and product development costs of $0.8 million.

General and administrative expense was $1,887,000 in the second quarter of 2016 compared with $2,776,000 in the second quarter 2015. General and administrative expense decreased by $0.9 million in the second quarter of 2016 primarily due to lower facility costs of $0.7 million and professional fees of $0.2 million.

General and administrative expense was $3,931,000 in the six-months ended June 30, 2016 compared with $5,963,000 in the six-months ended June 30, 2015. General and administrative expense decreased by $2.0 million in the six-months ended June 30, 2016 primarily due to lower facility costs of $1.6 million, labor related costs of $0.2 million and professional fees of $0.2 million.