On October 31, 2017 Aclaris Therapeutics, Inc. (NASDAQ:ACRS), a clinical-stage biotechnology company, reported that it will release its third quarter financial results before the market open on November 7, 2017 (Press release, Aclaris Therapeutics, OCT 31, 2017, View Source [SID1234521552]).

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Management will conduct a conference call at 8:00 AM ET that day to discuss the Company’s financial results and provide a general business update. A live webcast of the event can be accessed on the Events and Presentations page on the Investors section of the Aclaris website at View Source A replay of the webcast will be archived on the Aclaris website following the event.

To participate on the live call, please dial (844) 776-7782 (domestic) or (661) 378-9535 (international), and reference conference ID 99295180 prior to the start of the call.

On October 31, 2017 Dr. Reddy’s Laboratories Ltd. (BSE: 500124 | NSE: DRREDDY | NYSE: RDY) reported its consolidated financial results for the second quarter and half year ended September 30, 2017 under International Financial Reporting Standards (IFRS) (Press release, Dr Reddy’s, OCT 30, 2017, View Source [SID1234521341]).

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Q2 FY18: Key Highlights

Revenues at Rs. 35.5 billion [QoQ growth: 7%; YoY decline: 1%]
Gross Profit Margin at 53.3% [Q1 FY18: 51.6%; Q2FY 17: 56.0%]
Research & Development (R&D) spend at Rs. 4.2 billion. [11.8% of Revenues]
Selling, general & administrative (SG&A) expenses at Rs. 11.0 billion [YoY decrease: 6%]
EBITDA at Rs. 6.9 billion [19.4% of Revenues]
Profit after tax at Rs. 2.8 billion [8.0% of Revenues]
H1 FY18: Key Highlights

Revenues at Rs. 68.6 billion [YoY growth: 1%]
Gross Profit Margin at 52.5% [H1 FY17: 56.1%]
Research & Development (R&D) spend at Rs. 9.3 billion. [13.5% of Revenues]
Selling, general & administrative (SG&A) expenses at Rs. 22.8 billion [YoY decrease: 5%]
EBITDA at Rs. 10.2 billion [14.9% of Revenues]
Profit after tax at Rs. 3.4 billion [5.0% of Revenues]
Commenting on the results, CEO and Co-chairman, G.V. Prasad said, "Healthy performances in India, Emerging Markets, Europe and PSAI businesses, as well as continued focus on cost control, have contributed to sequential growth in our topline as well as bottom line, with an EBITDA increase of 105% over the previous quarter.

Looking ahead, we expect to see results from products launched in the U.S. during the first half of this fiscal. We will continue to focus on the launching of new products, as well as on improving operational efficiencies and quality management systems across the company."

All amounts in millions, except EPS
All US dollar amounts based on convenience translation rate of I USD = Rs. 65.30

Dr. Reddy’s Laboratories Limited and Subsidiaries
Consolidated Income Statement

Particulars Q2 FY 18 Q2 FY 17 Growth %
($) (Rs.) % ($) (Rs.) %
Revenues 543 35,460 100.0 549 35,857 100.0 (1 )
Cost of revenues 254 16,559 46.7 241 15,760 44.0 5
Gross profit 289 18,901 53.3 308 20,097 56.0 (6 )
Operating Expenses
Selling, general & administrative expenses 169 11,032 31.1 180 11,774 32.8 (6 )
Research and development expenses 64 4,175 11.8 80 5,214 14.5 (20 )
Other operating expense / (income) (2 ) (114 ) (0.3 ) (4 ) (277 ) (0.8 ) (59 )
Results from operating activities 58 3,808 10.7 52 3,386 9.4 12
Finance expense / (income), net 0 24 0.1 (6 ) (365 ) (1.0 )
Share of (profit) of equity accounted investees, net of income tax (1 ) (92 ) (0.3 ) (1 ) (84 ) (0.2 ) 10
Profit before income tax 59 3,876 10.9 59 3,835 10.7 1
Income tax expense 16 1,027 2.9 14 885 2.5 16
Profit for the period 44 2,849 8.0 45 2,950 8.2 (3 )

Diluted EPS 0.26 17.15 0.27 17.76 (3 )

EBITDA Computation

Particulars Q2 FY 18 Q2 FY 17
($) (Rs.) ($) (Rs.)
Profit before income tax 59 3,876 59 3,835
Interest (income) / expense net* 1 72 (5 ) (329 )
Depreciation 32 2,078 29 1,897
Amortization 13 862 15 950
Impairment - - 1 67
EBITDA 105 6,888 98 6,420
EBITDA (% to sales) 19.4 17.9

* – Includes income from Investments

Key Balance Sheet Items

Particulars As on 30th Sep 17 As on 30th June 17

($)
(Rs.) ($) (Rs.)
Cash and cash equivalents and Other current Investments 257 16,793 223 14,572
Trade receivables 646 42,203 630 41,140
Inventories 413 26,998 430 28,095
Property, plant and equipment 887 57,905 882 57,611
Goodwill and Other Intangible assets 760 49,634 744 48,564
Loans and borrowings (current & non-current) 822 53,668 773 50,462
Trade payables 217 14,193 203 13,225
Equity 1,866 1,21,840 1,890 1,23,423

Revenue Mix by Segment [Year on year]

Particulars Q2 FY 18 Q2 FY 17 Growth %
($) (Rs.) % ($) (Rs.) %
Global Generics 438 28,618 81 % 444 28,995 81 % -1
North America 14,318 16,134 -11
Europe* 2,424 1,776 36
India 6,370 6,251 2
Emerging Markets# 5,506 4,834 14
PSAI 87 5,654 16 % 89 5,784 16 % -2
North America 962 1,135 -15
Europe 1,938 2,095 -7
India 436 575 -24
Rest of World 2,318 1,979 17
Proprietary Products & Others 18 1,188 3 % 17 1,078 3 % 10
Total 543 35,460 100 % 549 35,857 100 % -1

Revenue Mix by Segment [Sequential]

Particulars Q2 FY 18 Q1 FY 18 Growth %
($) (Rs.) % ($) (Rs.) %
Global Generics 438 28,618 81 420 27,455 83 % 4
North America 14,318 14,946 -4
Europe* 2,424 2,075 17
India 6,370 4,687 36
Emerging Markets# 5,506 5,747 -4
PSAI 87 5,654 16 71 4,651 14 % 22
North America 962 779 23
Europe 1,938 1,863 4
India 436 288 51
Rest of World 2,318 1,721 35
Proprietary Products & Others 18 1,188 3 16 1,053 3 % 13
Total 543 35,460 100 % 508 33,159 100 % 7
* Europe primarily includes Germany, UK and out licensing sales business
# Emerging Markets refers to Russia, other CIS countries, Romania and Rest of the World markets including Venezuela

Segmental Analysis

Global Generics (GG)

Revenues from GG segment at Rs. 28.6 billion, year-on-year marginal decline of 1%; decline primarily on account of lower contribution from North America offset by increased contribution from Europe, India and Emerging Markets.

Revenues from North America at Rs. 14.3 billion. Year-on-year decline of 11%, primarily on account of higher price erosions due to channel consolidation and increased competition in some of our key products namely Valgancyclovir, Azacitidine, Esomeprazole, etc.

During the quarter we launched 4 new products i.e. Sevelamer Carbonate, Cefixime OS, Bupropion XL and Metaxalone tabs. Since Sevelamer carbonate was launched post the cut-off date for revenue recognition, no sales have been recorded during the quarter.

As of 30th September 2017, cumulatively 103 generic filings are pending for approval with the USFDA (100 ANDAs and 3 NDAs under 505(b)(2) route). Of these 100 ANDAs, 60 are Para IVs out of which we believe 28 have ‘First to File’ status.
Revenues from Emerging Markets at Rs. 5.5 billion, year-on-year growth of 14%.
Revenues from Russia at Rs. 3.2 billion, year-on-year growth of 20%. In constant currency i.e. in Ruble terms year-on-year growth of 13%. Growth driven by higher volume uptake in base business and new products.
Revenues from other CIS countries and Romania market at Rs. 0.9 billion, year-on-year growth of 3%.
Revenues from Rest of World (RoW) territories at Rs. 1.4 billion, year-on-year growth of 9%.
Revenues from India at Rs. 6.4 billion, year-on-year growth of 2%. Partial recovery was witnessed in the inventory holding by the channel post the transition to the GST regime. Pre-GST transition, the reported numbers included the excise duty component with a corresponding charge in the income statement. Post the transition, revenues reported are lower to the extent of the ED component, though it’s a profit neutral adjustment. Normalizing for this and some other transition related adjustments, the comparable year-on-year growth would be around 10%.
Revenues from Europe at Rs. 2.4 billion, year-on-year growth of 37%. Growth primarily driven by new launches and volume uptake in some of the key products.
Pharmaceutical Services and Active Ingredients (PSAI)

Revenues from PSAI at Rs. 5.7 billion, year-on-year decline of 2%. On a sequential basis revenues registered a growth of 22% aided by improved order flow and supply situations.
During the quarter, 16 DMFs were filed globally of which 2 were in the US. The cumulative number of DMF filings as of 30th September, 2017 was 780.
Income Statement Highlights:

Gross profit margin at 53.3% and declined by ~270 bps over that of previous year, decline primarily on account of higher price erosions due to channel consolidation and increased competitive intensity in some of our key molecules in the US. Gross profit margin for GG and PSAI business segments are at 59.2% and 19.6% respectively.

Gross profit margins improved 170 bps sequentially, aided by favorable manufacturing overheads leverage (higher revenues and lower overheads).
SG&A expenses at Rs. 11.0 billion, a decrease of 6% both year-on-year and sequentially. In Q2 FY17 the company had accrued a potential liability of Rs. 344 million towards NPPA provision. After adjusting the base, the marginal decline is primarily on account of prudent control on spend.
Research & development expenses at Rs. 4.2 billion. As % to Revenues- Q2 FY18: 11.8% | Q1 FY 18: 15.3% | Q2 FY17: 14.5%]. Compared to the trend, spend is lower partially on account of deferment in some of the milestone related payments to subsequent quarters. Focus continues on building complex generics, biosimilars and differentiated products pipeline.
Net Finance expense at Rs. 24 million compared to the net finance income of Rs. 365 million in Q2FY17. The incremental expense of Rs. 389 million is on account of:
Net foreign exchange gain of Rs. 47 million in the current quarter vs net foreign exchange gain of Rs. 37 million in the previous year.
Decrease in profit on sales of investments by Rs. 289 million.
Net increase in interest expense of Rs. 110 million.
Profit after Tax at Rs. 2.8 billion.
Diluted earnings per share is at Rs. 17.15.
Capital expenditure is at Rs. 2.8 billion.
Earnings Call Details (06:30 pm IST, 09:00 am EDT, October 31, 2017)

The Company will host an earnings call to discuss the performance and answer any questions from participants. This call will be accessible through an audio dial-in and a web-cast.

Audio conference Participants can dial-in on the numbers below
Primary number:
91 22 3960 0616
Secondary number:
91 22 6746 5826
International Toll Free Number
USA
18667462133

UK
08081011573
Singapore
8001012045
Hong Kong
800964448

Playback of call:
91 22 3065 2322, 91 22 6181 3322
Conference ID:
375#
Web-cast
More details will be provided through our website, www.drreddys.com
Transcript of the event will be available at www.drreddys.com. Playback will be available for a few days.

On October 31, 2017 MabVax Therapeutics Holdings, Inc. (NASDAQ: MBVX), a clinical-stage oncology drug development company focused on the development of antibody-based products to address unmet medical needs in the treatment of cancer, reported an important update on its HuMab-5B1 clinical program as well as presented preclinical data for its HuMab-Tn research program describing a new series of fully-human antibodies targeting ovarian and breast cancer at the AACR (Free AACR Whitepaper)-NCI-EORTC AACR-NCI-EORTC (Free AACR-NCI-EORTC Whitepaper) International Conference on Molecular Targets and Cancer Therapeutics (EORTC-NCI-AACR) (Free ASGCT Whitepaper) (Free EORTC-NCI-AACR Whitepaper) held October 26 – 30, 2017 in Philadelphia, Pennsylvania (Press release, MabVax, OCT 31, 2017, View Source [SID1234521357]).

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MabVax Therapeutics Logo (PRNewsfoto/MabVax Therapeutics Holdings, I)

Three posters were presented by Paul W. Maffuid, Ph.D., Executive Vice President of Research and Development, outlining important progress in the Company’s lead fully human antibody programs, HuMab-5B1 currently in Phase 1 clinical development for the treatment of pancreatic cancer and other CA19-9 positive malignancies, and HuMab-Tn currently in preclinical development with potential clinical utility in breast and ovarian cancers.

MVT-5873 in combination with nab-paclitaxel and gemcitabine as first line therapy – The Company reported that newly diagnosed pancreatic cancer patients participating in the Phase 1 clinical trial of MVT-5873, when given in combination with first line nab-paclitaxel and gemcitabine, demonstrated reductions in tumor size after the first two months of therapy. The data reported from this dose escalation safety study included safety data from 7 patients at 1mg/kg and 0.125mg/kg. After the first cohort was treated at 1mg/kg, the MVT-5873 dose was reduced to 0.125 mg/kg in combination with nab-paclitaxel and gemcitabine as the lower dose appears to be generally well tolerated. Two of 3 patients at this lower dose had a partial response (PR) with the remaining patient recording stable disease (SD). One patient continues therapy after six-months. The Company is currently enrolling an additional cohort of patients at the 0.125mg/kg cohort and expects to report on additional data near the end of this year.

Utility of HuMab-5B1 (MVT-5873) in cancers beyond pancreatic cancer – At the AACR (Free AACR Whitepaper)-NCI-EORTC meeting, the Company presented a series of studies examining expression of CA19-9 on tumor microarrays (TMA) and patient derived tumor xenografts (PDX). The results support the expansion of clinical studies of MVT-5873 for the treatment of other CA19-9 positive malignancies, including colorectal, small cell lung and non-small lung cell cancers. Human colorectal (CRC) TMA samples displayed moderate to high levels of positive staining with MVT-5873 in >75% of tumor samples evaluated. MVT-5873 staining of PDX samples was positive in 21% of non-small cell lung cancer (NSCLC), 50% of small cell lung cancer (SCLC), and 69% of CRC cores evaluated. The study included PDX samples from patients with KRAS, BRAF, PIK3CA, or MMR pathway mutations and PDX samples rendered chemoresistant. These results support that expression of CA19-9 in these tumor types is unaffected by mutational status or treatment with chemotherapy. Based on these encouraging data, the Company plans to enroll and treat patients in its ongoing clinical trials with tumor types beyond pancreatic cancer. The Company has previously reported Phase 1a results for MVT-5873 as a single agent in pancreatic cancer patients.

New antibodies focused on the treatment of breast and ovarian cancer – The Company presented data from its lead preclinical development program summarizing the discovery, optimization, and target validation of new series of fully-human antibodies targeting the Thomsen-nouveau (Tn) and the sialyl Tn (sTn) carbohydrate antigens that have potential use for the treatment of patients with ovarian and breast cancers. Tissue microarray data support that these carbohydrate antigens are present on a broad array of tumor types and minimally seen on normal tissues. The results summarized the binding specificity, high affinity, and internalization data that make this series of antibodies attractive as development candidates. Target validation data included screening against multiple patient tumor microarrays of breast, lung, ovarian and colon cancer. 90% of samples from patients with triple negative breast cancer and 50% of samples from patient with ovarian cancer tested positive. A patent application covering this series of antibodies was recently filed by the Company and it is actively advancing the lead series.

On October 30, 2017 Acorda Therapeutics, Inc. (Nasdaq:ACOR) provided a financial and pipeline update for the third quarter ended September 30, 2017 (Press release, Acorda Therapeutics, OCT 31, 2017, View Source [SID1234521332]).

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“We have had a constructive dialogue with the FDA since the issuance of its Refusal to File letter, and we plan to resubmit the INBRIJA NDA in the fourth quarter. We believe our resubmission reflects a strong package that incorporates feedback we received from FDA,” said Ron Cohen, M.D., Acorda’s President and CEO. “We are also on track to announce top-line data from our Phase 3 study of tozadenant in the first quarter of 2018.”

“INBRIJA and tozadenant are being developed as therapies for people with Parkinson’s, INBRIJA for on-demand use to treat symptoms of OFF periods and tozadenant as a daily oral treatment to increase overall ON time. If approved, they have the potential to position Acorda as a leader in the development of Parkinson’s therapy, creating substantial value for shareholders.”

Third Quarter 2017 Financial Results

AMPYRA (dalfampridine) Extended Release Tablets, 10 mg – For the quarter ended September 30, 2017, the Company reported AMPYRA net revenue of $132.6 million compared to $128.8 million for the same quarter in 2016.

FAMPYRA (prolonged-release fampridine tablets) – For the quarter ended September 30, 2017, the Company reported FAMPYRA royalties from sales outside of the U.S. of $3.1 million compared to $2.6 million for the same quarter in 2016.

Research and development (R&D) expenses for the quarter ended September 30, 2017 were $33.3 million, including $2.0 million of share-based compensation and $.03 million of restructuring expenses compared to $54.8 million, including $2.9 million of share-based compensation, for the same quarter in 2016.

Sales, general and administrative (SG&A) expenses for the quarter ended September 30, 2017 were $40.7 million, including $4.6 million of share-based compensation and $0.01 million of restructuring expenses compared to $54.4 million, including $7.1 million of share-based compensation for the same quarter in 2016.

The Company recorded a non-cash intangible asset impairment charge of $39.4 million in the quarter ended September 30, 2017 for Selincro. Selincro is currently marketed in Europe by the licensor for the reduction of alcohol consumption in alcohol dependent adults. The Company re-assessed its valuation assumptions, including expected future growth related to the expansion into new markets, and determined that the intangible asset was impaired.

Provision for income taxes for the quarter ended September 30, 2017 was $18.9 million, including $3.7 million of cash taxes, compared to a provision for income taxes of $3.0 million, including $1.0 million of cash taxes, for the same quarter in 2016.

The Company reported a GAAP net loss attributable to Acorda of $(25.2) million for the quarter ended September 30, 2017, or $(0.55) per diluted share. GAAP net loss in the same quarter of 2016 was $(12.7) million, or $(0.28) per diluted share.

Non-GAAP net income for the quarter ended September 30, 2017 was $20.1 million, or $0.43 per diluted share. Non-GAAP net loss in the same quarter of 2016 was $(1.9) million, or $(0.04) per diluted share. This quarterly non-GAAP net income measure, more fully described below under “Non-GAAP Financial Measures,” excludes share-based compensation charges, non-cash interest charges on our debt, restructuring expenses, changes in the fair value of acquired contingent consideration, intangible asset impairment charges and acquisition-related expenses. A reconciliation of the GAAP financial results to non-GAAP financial results is included with the attached financial statements.

At September 30, 2017, the Company had cash and cash equivalents of $192.5 million.

Guidance for 2017

The Company reiterates AMPYRA 2017 net revenue of $535-$545 million.
R&D expenses for the full year 2017 are expected to be $160-$170 million. This guidance is a non-GAAP projection that excludes share-based compensation and restructuring costs, as more fully described below under “Non-GAAP Financial Measures.”
The Company is reducing its SG&A expense guidance for the full year 2017 from $170-$180 million to $160-$170 million. This guidance is a non-GAAP projection that excludes share-based compensation and restructuring costs, as more fully described below under “Non-GAAP Financial Measures.”
The Company expects to be cash flow positive in 2017, with a projected year-end cash balance in excess of $200 million.
Third Quarter 2017 Highlights

INBRIJA (levodopa inhalation powder) in Parkinson’s disease
In August, the Company received a Refusal to File (RTF) letter regarding its NDA for INBRIJA. After constructive dialogue with the FDA, the Company expects to resubmit the NDA in Q4 2017.
As a result, the Company has revised the timing for its end-of-year submission of the Marketing Authorization Application (MAA) to the European Medicines Agency (EMA) to Q1 2018.
INBRIJA is an investigational treatment for symptoms of OFF periods in people with Parkinson’s disease taking a carbidopa/levodopa regimen.
Tozadenant in Parkinson’s disease
The Company expects to report topline Phase 3 in Q1 2018.
Tozadenant is an investigational treatment for the reduction of OFF time in people with Parkinson’s disease.
AMPYRA (dalfampridine)
The Company filed its opening brief for its appeal to the U.S. Court of Appeals for the Federal Circuit of the District Court’s decision in the AMPYRA patent litigation. The defendants have filed their opposition and cross-appeal opening brief. Reply briefs from both parties are expected to be filed in November 2017, followed by oral argument to be scheduled by the appellate court.
Both BIO and PhRMA filed amicus briefs in support of the Company’s appeal, raising important issues in conjunction with biopharmaceutical innovation.
The Company expects to maintain exclusivity of AMPYRA at least through July 2018.
Webcast and Conference Call

The Company will host a conference call today at 8:30 a.m. ET. To participate, please dial (844) 579-6824 (domestic) or (763) 488-9145 (international) and reference the access code 95686626. A replay of the call will be available from 11:30 a.m. ET on October 31, 2017 until 2:59 p.m. ET on November 30, 2017. To access the replay, please dial (855) 859-2056 (domestic) or (404) 537-3406 (international) and reference the access code 95686626. The archived webcast will be available in the Investor Relations section of the Acorda website at www.acorda.com.On October 30, 2017

On October 31, 2017 AstraZeneca and MedImmune, its global biologics research and development arm, reported the expansion of their clinical collaboration with Incyte Corporation (Press release, AstraZeneca, OCT 31, 2017, View Source [SID1234521325]). As part of the agreement, the companies will evaluate the efficacy and safety of epacadostat, Incyte’s investigational selective IDO1 enzyme inhibitor, in combination with AstraZeneca’s Imfinzi (durvalumab), a human monoclonal antibody directed against PD-L1, compared to Imfinzi alone.

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The exclusive collaboration for the study population allows for the two companies to conduct a Phase III trial in patients with locally-advanced (Stage III), unresectable non-small cell lung cancer (NSCLC) whose disease has not progressed following platinum-based chemotherapy concurrent with radiation therapy (CRT).

Sean Bohen, Executive Vice President, Global Medicines Development and Chief Medical Officer at AstraZeneca, said: "Imfinzi has shown exciting clinical potential in treating patients with locally-advanced lung cancer. We are pleased to build on recent data from the PACIFIC trial to further explore how Imfinzi, in combination with an IDO inhibitor could provide additional benefit to patients with locally-advanced lung cancer."

Steven Stein, MD, Chief Medical Officer, Incyte, said: "We are pleased to expand our ongoing clinical collaboration with AstraZeneca and to further explore the potential of epacadostat in patients with locally-advanced unresectable lung cancer. We look forward to beginning an additional pivotal trial for epacadostat, as we seek to position IDO1 enzyme inhibition as a key component of combination immunotherapy."

The Phase III trial, which will be co-funded by the two companies and will be conducted by AstraZeneca, is expected to begin enrolling patients in the first half of 2018. This agreement builds on an existing clinical collaboration for Imfinzi and epacadostat announced by both companies in May 2014.

NOTES TO EDITORS

About Locally-Advanced (Stage III) NSCLC

Stage III lung cancer is divided into two stages (IIIA and IIIB), which are defined by how much the cancer has spread locally and the possibility of surgery.

Stage III lung cancer represents approximately one-third of NSCLC incidence and was estimated to affect around 105,000 patients in seven leading markets[1] in 2016. More than half of these patients have tumours that are unresectable. The current standard of care is chemotherapy and radiation followed by active surveillance to monitor for progression. The prognosis remains poor and long-term survival rates are low.

About Epacadostat (INCB024360)

The immunosuppressive effects of indoleamine 2,3-dioxygenase 1 (IDO1) enzyme activity on the tumour microenvironment help cancer cells evade immunosurveillance. Epacadostat is an investigational, highly-potent and selective oral inhibitor of the IDO1 enzyme. In single-arm studies, the combination of epacadostat and immune checkpoint inhibitors has shown proof-of-concept in patients with unresectable or metastatic melanoma, non-small cell lung cancer, renal cell carcinoma, squamous cell carcinoma of the head and neck and bladder cancer. In these studies, epacadostat combined with the CTLA-4 inhibitor ipilimumab or the PD-1 inhibitors pembrolizumab or nivolumab improved response rates compared with studies of the immune checkpoint inhibitors alone.