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.

On August 03, 2016 Insys Therapeutics, Inc. (NASDAQ:INSY) ("Insys" or "the Company") reported financial results for the three-month period ended June 30, 2016 (Press release, Insys Therapeutics, AUG 3, 2016, View Source;p=RssLanding&cat=news&id=2192279 [SID:1234514202]).

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Highlights of and subsequent to the second quarter of 2016 include:

Total net revenue was $67.1 million, compared to $77.6 million for the second quarter of 2015;

Net income totaled $4.4 million, or $0.06 per basic and $0.06 per diluted share, compared to net income of $7.3 million, or $0.10 per basic and $0.10 per diluted share, for the second quarter of 2015;

Cash, cash equivalents and investments were $193.7 million as of June 30, 2016; and

Insys received FDA approval for the marketing of SyndrosTM (dronabinol oral solution), a proprietary, orally administered liquid formulation of dronabinol.
"We are pleased that despite the recent drop-off in volume, Subsys has maintained an approximately 44% market share. We believe that Subsys will continue to provide a very solid financial foundation for the Company, and we remain focused on restoring Subsys scripts to a growth path," said Dr. John N. Kapoor, Chairman, President and Chief Executive Officer of Insys Therapeutics. "The recent FDA approval to market Syndros is excellent news. We are eager to expand our commercial portfolio with a product that we believe has distinct advantages over the current formulation of dronabinol in soft gel capsule and one that will provide significant long-term growth opportunities for Insys. We are proud of our pipeline and believe that product candidates in both sprays and cannabinoids hold great promise. As always, we remain committed to serving the patients who rely on our compounds, while striving to deliver value to Insys stockholders," he concluded.

Second Quarter 2016 Financial Results

Net revenue for the second quarter of 2016 was $67.1 million compared to $77.6 million for the second quarter of 2015, a decrease of 13.5%. The results reflect a decline in Subsys prescription volumes due to softness in overall demand in the TIRF category, including Subsys, and continued pressure from third-party payers.

Gross margin was 91% for the second quarter of 2016 compared with 89% for the comparable quarter of 2015.

Sales and marketing expense was $19.7 million during the second quarter of 2016, or 29% of net revenue, compared to $22.0 million, or 28% of net revenue, for the second quarter of 2015.

Research and development expense increased to $22.9 million for the second quarter of 2016, compared to $17.8 million for the second quarter of 2015, as we continue to advance the multistage products in our pipeline.

General and administrative expense decreased to $13.9 million for the second quarter of 2016, down from $15.3 million for the second quarter of 2015.

Income tax expense was $240,000 for the second quarter of 2016, compared to $4.8 million during the second quarter of 2015.

Net income for the second quarter of 2016 was $4.4 million, or $0.06 per basic and $0.06 per diluted share, compared to net income of $7.3 million, or $0.10 per basic and $0.10 per diluted share, for the second quarter of 2015. Non-GAAP adjusted net income for the second quarter of 2016 was $9.5 million, or $0.13 per diluted share, compared to non-GAAP adjusted net income of $15.6 million, or $0.21 per diluted share, in the prior-year quarter. The reconciliation of net income to non-GAAP adjusted net income is included at the end of this press release.

Liquidity

The Company had $193.7 million in cash, cash equivalents, and short-term and long-term investments, no debt, and $259 million in stockholders’ equity as of June 30, 2016.

Idera Pharmaceuticals has filed a 10-Q – Quarterly report [Sections 13 or 15(d)] with the U.S. Securities and Exchange Commission (Filing, 10-Q, Idera Pharmaceuticals, AUG 2, 2016, View Source [SID1234514177]).

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On August 2, 2016 Compugen Ltd. (NASDAQ: CGEN), a leading predictive drug discovery company, reported financial results for the second quarter ending June 30, 2016 (Filing, Q2, Compugen, 2016, AUG 2, 2016, View Source [SID:1234514182]).

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Anat Cohen-Dayag, Ph.D., Compugen’s President and Chief Executive Officer, stated, "Our broad portfolio of novel targets for immuno-oncology is comprised of two key categories – T cell-based and myeloid cell-based immune checkpoint target candidates, with candidates in both categories identified within the tumor microenvironment of multiple types of cancers. These discoveries provide Compugen with the potential for the development of multiple transformational, first-in-class, antibody drugs for immuno-oncology. In this respect, during the past quarter we selected a lead therapeutic antibody for CGEN-15029, named COM701, which is now undergoing preclinical development activities in preparation for advancement to clinical trials, with an anticipated IND filing next year."

Dr. Cohen-Dayag continued, "In parallel with our therapeutic development activities, we are also pursuing a significant, previously undisclosed research activity, under which we have established a comprehensive in vivo validation system, based on knockout mice, where the target of interest has been genetically removed. This activity was initiated in early 2015 and was applied to the majority of the Company’s immuno-oncology target candidates, in order to further evaluate in vivo their likely clinical relevance, identify effective drug combinations, and assess the mechanisms-of-action by which our targets suppress immune response. Similar evaluations in knockout mice were a major factor driving the development of approved immuno-oncology therapies such as PD-1 and CTLA-4 inhibitors, and have been shown to be predictive of the ultimate clinical relevance of their respective target proteins."

Dr. Cohen-Dayag concluded, "Now, with our immuno-oncology target pipeline consisting of both T cell-based and myeloid cell-based immune checkpoint target candidates, we are focusing on target candidates that have the potential to complement each other, and that are expected to substantially enhance the overall value of our pipeline, particularly when taking into consideration the need for combination therapies."

Revenues for the second quarter of 2016 and six months ending June 30, 2016 were $0.5 million and $0.6 million respectively, compared with $0.2 million and $0.7 million for the comparable periods in 2015, reflecting primarily the milestone in the amount of $0.4 million achieved in the second quarter of 2016 and the non-cash amortization during these periods of the upfront payment, in both cases related to the August 2013 collaboration and license agreement with Bayer.

R&D expenses for the second quarter of 2016 and six months ending June 30, 2016 were $5.5 million and $12.2 million respectively, compared with $5.2 million and $10.1 million in the comparable periods in 2015. The increase primarily reflects expanded activities involving our pipeline program candidates, including the hiring of additional professional employees and manufacturing and regulatory consultants to support pre-clinical activities.

Net loss for the second quarter of 2016 was $6.6 million, or $0.13 per diluted share, compared with a net loss of $6.8 million, or $0.14 per diluted share, for the comparable period in 2015. Net loss for the six months ending June 30, 2016 was $15.2 million, or $0.30 per diluted share, compared with a net loss of $13.0 million, or $0.26 per diluted share, for the comparable period in 2015.

As of June 30, 2016, cash and cash related accounts totaled $74.1 million, compared with $81.4 million as of December 31, 2015. The Company has no debt.

On August 2, 2016 Foundation Medicine, Inc. (NASDAQ:FMI) reported financial and operating results for its second quarter ended June 30, 2016 (Press release, Foundation Medicine, AUG 2, 2016, View Source [SID:1234514184]). Highlights for the quarter included:

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Achieved second quarter revenue of $28.2 million, 26% year-over-year growth;
Reported 10,286 clinical tests in the second quarter, 16% year-over-year growth;
Grew FoundationCORE, the company’s molecular information knowledgebase, to nearly 90,000 patient cases;
Commercially launched FoundationACT, the company’s circulating tumor DNA (ctDNA) assay;
Presented new data at the 2016 annual meeting of the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) demonstrating that tumor mutational burden as measured by FoundationOne may predict response to cancer immunotherapies in a broad range of solid tumors;
Published 23 manuscripts in high-quality, peer-reviewed journals and delivered 30 podium and poster talks at various medical and scientific meetings.
Foundation Medicine reported total revenue of $28.2 million in the second quarter of 2016, compared to $22.5 million in the second quarter of 2015. Revenue from biopharmaceutical partners grew 88% to $18.8 million in the second quarter of 2016, compared to $10.0 million in the second quarter of 2015. The increase in revenue demonstrates the company’s leading role as an important partner in drug development for oncology-focused biopharmaceutical companies.

Revenue from clinical testing in the second quarter of 2016 was $9.4 million, compared to $12.4 million in the second quarter of 2015. The decrease in clinical revenue was driven in part by moving in-network with a large national payor for stage IV Non-Small Cell Lung Cancer (NSCLC) testing, which resulted in no longer receiving payments for other indications and also resulted in payment delays for the covered indication.

The company reported 10,286 clinical tests in the second quarter of 2016, a 16% increase from the same quarter last year. This reported volume number includes 8,864 FoundationOne tests and 1,248 FoundationOne Heme tests.

"Foundation Medicine reported a strong second quarter highlighted by continued growth in our biopharma business and robust clinical volume growth," said Michael Pellini, M.D., chief executive officer of Foundation Medicine. "We believe that our recent accomplishments, which also include our participating in both the Expedited Access Pathway with FDA and Parallel Review with FDA and CMS for FoundationOne, position our company for continued growth and further competitive differentiation, and place us at the leading edge of transforming cancer care."

The company’s molecular information knowledgebase, FoundationCORE, grew to nearly 90,000 patient cases. FoundationCORE is a unique asset and critical component of the value that Foundation Medicine delivers to its biopharmaceutical and physician customers. The increasing scale and breadth of this high quality, clinically relevant oncology data set derived from the company’s testing platform continues to enhance clinical practice and help enable improved outcomes for patients.

Total operating expenses for the second quarter of 2016 were approximately $45.5 million compared with $46.6 million for the second quarter of 2015, which included a one-time expense in April 2015 of $14.4 million in advisor fees related to the closing of the company’s strategic collaboration with Roche. Net loss was approximately $29.0 million in the second quarter of 2016, or a $0.84 loss per share. At June 30, 2016, the company held approximately $190.4 million in cash, cash equivalents and marketable securities.

Today, Foundation Medicine also secured a $100 million credit facility from Roche Finance. The facility represents a three-year line of credit, after which any outstanding balance will convert to a term loan payable over the following five years. No funds were drawn under the credit facility upon the closing. The company intends to use the proceeds for product development and commercialization, corporate development and working capital management.

Recent Enterprise Highlights

Announced acceptance of FoundationOne for review as part of the Expedited Access Pathway program with FDA and Parallel Review through FDA and CMS. If approved, FoundationOne could be the first FDA-approved comprehensive genomic profiling (CGP) assay to incorporate multiple companion diagnostics to support precision medicine in oncology and would be offered as a covered benefit to Medicare beneficiaries nationwide. View Source
Announced the first strategic initiative under a master collaboration agreement with AstraZeneca to develop a novel companion diagnostic assay for Lynparza to support its global development program.
Announced the release of a broad set of genomic profiles of adult cancers from FoundationCORE to the National Cancer Institute in support of the National Cancer Moonshot and Precision Medicine initiatives.
2016 Outlook

Foundation Medicine’s business and financial outlook for 2016 is the following:

The company expects 2016 revenue will be in the range of $110 to $120 million.
The company is increasing clinical volume guidance and now expects to deliver between 39,000 and 41,000 FoundationOne and FoundationOne Heme clinical tests in 2016.
The company expects operating expenses will be in the range of $175 and $185 million.
The company intends to expand upon reimbursement progress and work to drive additional coverage decisions.