On May 9, 2016 Halozyme Therapeutics, Inc. (NASDAQ: HALO) reported financial results for the first quarter ended March 31, which included an increase in revenue of 128 percent from the prior-year period and a net loss of $19.8 million, or $0.16 per share, compared to a net loss in the first quarter of 2015 of $15.1 million, or $0.12 per share (Press release, Halozyme, MAY 9, 2016, View Source [SID:1234512116]).

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"During the first quarter, we continued to execute against our two-pillar strategy with ongoing clinical studies of PEGPH20 and through growing the value of our ENHANZE platform," said Dr. Helen Torley, president and chief executive officer. "We made good progress toward our goal of initiating greater than 90 percent of HALO-301 sites by the end of the year and in evaluating the recommended dose to take into the expansion phase of our lung and gastric cancer studies.

"With our ENHANZE platform, we continued to see strong growth in royalty revenue combined with progress from our partners’ programs. During the quarter, Lilly nominated its third target triggering an $8 million milestone and Pfizer nominated an additional target triggering a $1.5 million milestone. These developments highlight the great potential associated with our ENHANZE technology franchise."

First Quarter 2016 and Recent Highlights include:

Dosing of first patient in HALO-301 | Pancreatic study in March, a phase 3 study to explore PEGPH20 with gemcitabine and ABRAXANE (nab-paclitaxel) in metastatic pancreatic cancer patients. The company plans to initiate sites outside the United States beginning in the second quarter and to reach its target of greater than 90 percent of centers ready to start screening patients by the end of the year.
Approval by the Food and Drug Administration (FDA) of an investigational device exemption for the companion diagnostic test developed with Ventana to prospectively identify patients with high levels of hyaluronan, or HA, in the company’s phase 3 study.
Progressing towards dose expansion in its phase 1b/2 PRIMAL study of PEGPH20 plus docetaxel in non-small cell lung cancer patients. The company is now evaluating patients at a dose of 2.2 µg/kg and remains on track to move into the dose expansion phase of the study in the second half of 2016.
Advancing into the second dosing cohort and recently submitting a protocol amendment in its phase 1b study of PEGPH20 plus KEYTRUDA (pembrolizumab) in lung and gastric cancer patients. The company submitted the protocol amendment to the FDA based on bleeding events observed in heavily pretreated relapsed gastric cancer patients. These events were not classified as dose limiting toxicities or determined by investigators to be related to PEGPH20. Halozyme is awaiting feedback from the FDA and plans to resume enrollment in the second dosing cohort following approval of the amendment.
Eli Lilly nominating their third target to be studied with Halozyme’s ENHANZE platform, triggering an $8 million milestone payment to Halozyme which will be received in the second quarter.
Pfizer nominating an additional target to be studied with Halozyme’s ENHANZE platform, triggering a $1.5 million milestone to Halozyme.
Baxalta receiving a positive opinion for HYQVIA from the Committee for Medicinal Products for Human Use for a pediatric indication in Europe. In addition, Baxalta initiated a phase 3 trial in patients with chronic inflammatory demyelinating polyneuropathy.
Expansion of oncology pipeline and demonstration of expertise in the tumor microenvironment with two new preclinical programs, an immune checkpoint inhibitor targeting adenosine and a novel antibody-drug conjugate targeting epidermal growth factor receptor. Preclinical data for the discovery and early development of these potential drug candidates were shared during the 2016 American Association for Cancer Research (AACR) (Free AACR Whitepaper) annual conference.
First Quarter 2016 Financial Highlights

Revenue for the first quarter was $42.5 million, compared to $18.7 million for the first quarter of 2015, driven primarily by milestone payments from Lilly and AbbVie, as well as royalties from partner sales of Herceptin SC, MabThera SC and HYQVIA. Revenue for the quarter included $11.4 million in royalties, $9.0 million in sales of bulk rHuPH20 primarily for use in manufacturing collaboration products and $3.9 million in HYLENEX recombinant (hyaluronidase human injection) product sales.
Research and development expenses for the first quarter were $40.1 million, compared to $16.7 million for the first quarter of 2015. The planned increases were primarily due to expenses for preclinical and clinical support of PEGPH20 and clinical API supply to ENHANZE partners.
Selling, general and administrative expenses for the first quarter were $10.8 million, compared to $9.4 million for the first quarter of 2015. The increase was primarily due to an increase in personnel expenses, including stock compensation, for the period.
Net loss for the first quarter was $19.8 million, or $0.16 per share, compared to a net loss in the first quarter of 2015 of $15.1 million, or $0.12 per share.
Cash, cash equivalents and marketable securities were $238.6 million at Mar. 31, 2016 compared to $108.3 million at Dec. 31, 2015.
Financial Outlook for 2016

For the full year 2016, the company is updating its previously announced guidance. Halozyme now expects:

Net revenues to be in the range of $130 million to $145 million, an increase from the prior range of $110 million to $125 million, driven by unplanned ENHANZE milestones and an increase in bulk product sales to ENHANZE partners;
Operating expenses to be in the range of $245 million to $260 million, a narrowing of the bottom end of the prior range of $240 million to $260 million as a result of the increase in product sales to ENHANZE partners;
Cash flow to be in the range of $45 million to $65 million, an increase from the prior range of $35 million to $55 million; and
Year-end cash balance to be in the range of $150 million to $170 million, an increase from the prior range of $140 million to $160 million.

On May 9, 2016 Pfenex Inc. (NYSE MKT: PFNX), a clinical-stage biotechnology company engaged in the development of biosimilar therapeutics, including high value and difficult to manufacture proteins, reported financial results for the first quarter ended March 31, 2016 and provided a business update (Press release, Pfenex, MAY 9, 2016, View Source [SID:1234512316]).

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"Pfenex continued to make solid progress in the first quarter," stated Bertrand C. Liang, chief executive officer of Pfenex. "Today we announced the positive top-line data from our PF708 initial bioequivalence study which can be referred to in our separate press release issued this afternoon. In the second half of 2016, we expect to initiate the pivotal clinical program for PF530, our biosimilar candidate to Betaseron. Additionally, we expect to present data from our phase 1a study of Px563L, our anthrax vaccine candidate. We are looking forward to the key data readouts and study initiations over the remainder of 2016 which we believe will further highlight our differentiated business strategy and capabilities."

Business Highlights

The bioequivalence study in healthy subjects for PF708, our peptide product candidate that we are developing as a therapeutic equivalent to Forteo, met the primary outcome measures. We anticipate initiating the clinical program to satisfy the filing requirements for PF708 through the 505(b)(2) regulatory development pathway by year-end which will include an immunogenicity/pharmacokinetic study in subjects with osteoporosis.
Pfenex completed a Phase 1 trial of PF530, a biosimilar candidate to Betaseron, in 2015 which enrolled 12 healthy subjects. Based on the analysis of the trial PK and PD parameters, no statistical differences between PF530 compared to the reference compound were observed. The pivotal PK/PD study and immunogenicity trial are expected to initiate in 2H2016.
The pivotal clinical comparator trial for PF582, our biosimilar candidate to Lucentis which we partnered with Pfizer in February 2015, is expected to initiate in 2016. Pfizer is responsible for initiating and conducting the trial. The PF582 collaboration with Pfizer included an upfront payment of $51 million and milestone payments valued at up to $291 million as well as tiered double-digit royalties on net sales of PF582. We will share costs equally of the clinical comparative trial with Pfizer, up to a cap for Pfenex of $20 million, with $10 million of that amount offset as a credit against the royalties payable to us.
Pfenex initiated the Phase 1 trial for its recombinant anthrax vaccine in 2015 and expects an interim data read-out in 2H2016. In August 2015, Pfenex announced signing a five year, cost plus fixed fee contract valued at up to $143.5 million with the Biomedical Advanced Research and Development Authority (BARDA) of the Department of Health and Human Services (HHS), for the advanced development of our mutant recombinant protective antigen anthrax vaccine, which offers the potential for a dramatic improvement in the rapid production of large amounts of high value stable recombinant anthrax vaccine for the U.S. Government.
Financial Highlights for the First Quarter

Total Revenue increased by $0.8 million, or 40%, to $2.8 million in the three month period ended March 31, 2016 compared to $2.0 million in same period in 2015. The increase in revenue for the three month period was due to the stage of development of our Px563L product candidate under our government contracts and an increase in license revenue, offset by a decrease in product sales. The Phase 1 trial for Px563L, entirely funded through the U.S. government, was initiated at the end of 2015. Given the nature of the novel vaccine development process, revenue will fluctuate depending on stage of development.

Cost of revenue of $1.3 million decreased by approximately $32 thousand, or 2%, compared to the same period in 2015. The decrease in cost of revenue for the three month period was due primarily to a decrease in product sales, which is impacted by our customers’ product development and clinical progression. The decrease was offset by an increase in costs for our Px563L product candidate under our government contracts. Given the nature of the novel vaccine development process, these costs will fluctuate depending on stage of development.

Research and development expenses increased by approximately $2.7 million, or 95%, in the three month period ended March 31, 2016 to $5.5 million in the three month period ended March 31, 2016 compared to $2.8 million in same period in 2015. The increase in research and development expenses during the three month period was due to the increase in development activity on our product candidates PF708 and PF530 and the hiring of additional personnel dedicated to our research and development efforts. A bioequivalence study began at the end of 2015 for PF708, increasing costs over the same period last year. For PF530 and PF708, we expect research and development costs will increase going forward as we independently advance PF530 and PF708 as wholly-owned product candidates. We expect research and development expenses to increase for the foreseeable future as we advance our lead candidates and pipeline product candidates.

Selling, general and administrative expenses increased by $0.3 million, or 8%, to $4.2 million in the three month period ended March 31, 2016 compared to $3.9 million in the same period in 2015. The increase in selling, general and administrative expenses during the three month period was primarily due to an increase in personnel costs and an increase in activities associated with operating as a publicly-traded company. We expect general and administrative costs to continue to increase for activities associated with operating as a publicly-traded company including the hiring of additional personnel. In addition, we intend to continue to incur increased internal and external costs to support our various product development efforts, which can vary from period to period.

Cash and cash equivalents as of March 31, 2016 was $96.5 million.

On May 09, 2016 Idera Pharmaceuticals, Inc. (NASDAQ:IDRA), a clinical-stage biopharmaceutical company focused on the discovery, development and commercialization of novel nucleic acid-based therapeutics for oncology and rare diseases, reported its financial and operational results for the first quarter ended March 31, 2016 (Press release, Idera Pharmaceuticals, MAY 9, 2016, View Source;p=RssLanding&cat=news&id=2166519 [SID:1234512117]).

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"Idera continued to make strong progress across all of our areas of focus during the first period of 2016," stated Vincent Milano, Idera’s Chief Executive Officer. "Our clinical development teams have transformed our programs into executable registration strategies and the research group continues to advance the 3GA platform to put us into position to enter human proof of concept trials in 2017."

Continued Milano, "The amount of strategic consideration and effort that has taken place over the past year and the related execution should provide us with critical catalysts beginning in the second half of this year and right through the course of 2017 across all aspects of our business. We’re currently conducting four separate clinical trials and we expect data from all four of these studies over the course of the next six to 18 months. This is an exciting time for Idera and we look forward to a very bright future for the patients we aim to serve as well as our investors, who support these bold endeavors."

Research and Development Program Updates
IMO-8400 and IMO-2125 are our lead clinical development drug candidates. IMO-8400 is an oligonucleotide-based antagonist of Toll-like receptors (TLRs) 7, 8, and 9. IMO-2125 is an oligonucleotide-based agonist of TLR9. The company also announced during the fourth quarter of 2015, the first two development targets from its proprietary 3GA Technology platform: NLRP3 (NOD-like receptor family, pyrin domain containing protein 3) and DUX4 (Double Homeobox 4). The company plans to take the first 3GA candidate into human proof of concept studies in 2017.

Toll-like Receptor (TLR) Agonism

Immuno-Oncology Program
Idera’s development program in immuno-oncology is based on pre-clinical studies that demonstrated through the mechanism of intra-tumoral injections of the TLR9 agonist, IMO-2125, the tumor microenvironment could be impacted in a manner which positively increases the efficacy of check-point inhibition. These studies have led Idera into a strategic research alliance with the University of Texas MD Anderson Cancer Center to clinically explore the combination of checkpoint inhibitors.

In December 2015, Idera announced the initiation of a Phase 1/2 clinical trial of intra-tumoral IMO-2125 in combination with Ipilimumab in patients with relapsed or refractory Metastatic Melanoma being conducted at the University of Texas MD Anderson Cancer Center. The study will also include an arm exploring the combination of IMO-2125 with a PD1 inhibitor. The company expects to present the first translational data from the trial during the second half of 2016, with clinical results expected in 2017.

Additionally, the company presented new preclinical data demonstrating the potentiation of anti-tumor effects through combination of IMO-2125 and indoleamine-pyrolle 2,3-dioxygenase (IDO-1) in cancer models at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting.

Toll-like Receptor (TLR) Antagonism

Genetically Defined Forms of B-cell Lymphoma
Idera’s program in genetically defined forms of B-cell lymphoma is based on pre-clinical studies that have demonstrated in certain B-cell lymphomas driven by the oncogenic MYD88-L265P mutation, blocking TLR7 and 9 signaling can promote tumor cell death.

In December 2015, Idera presented positive clinical data from the ongoing Phase 1/2 trial of IMO-8400 in patients with Waldenstrom’s Macroglobulinemia at the 57th Annual Meeting of the American Society of Hematology (ASH) (Free ASH Whitepaper) in Orlando, FL. The company is continuing further dose escalation of IMO-8400 in both the ongoing trials in Waldenstrom’s Macroglobulinemia and Diffuse Large B-cell Lymphoma to further explore the full potential of IMO-8400 based on the safety profile and efficacy signals seen to date. The company expects to complete the accrual of the escalated dosing for both the WM and DLBCL studies by the end of 2016, with data available in the first half of 2017.

Idera previously announced that the U.S. Food and Drug Administration (FDA) granted orphan drug designation for IMO-8400 for the treatment of Waldenström’s macroglobulinemia and DLBCL.

Rare Diseases
In November 2015, Idera announced the initiation of a Phase 2 clinical trial of IMO-8400 in patients with Dermatomyositis. The company expects to have the DM Phase 2 study fully enrolled in the first half of 2017.

The company announced during the first quarter of 2016 that due to the resources required to fully commit to a Duchenne muscular dystrophy (DMD) clinical development endeavor, the company has chosen to suspend internal efforts at this time to advance IMO-8400 into clinical development for DMD.

Third Generation Antisense Platform

Throughout 2015, the company undertook an analysis and prioritization of oncology and rare disease indications for potential development of drug candidates derived from our 3GA technology platform. The key considerations in identifying disease indications from our third generation antisense program included: strong evidence that the disease is caused by a specific protein; clear criteria to identify a target patient population; biomarkers for early assessment of clinical proof-of-concept; a targeted therapeutic mechanism for action; and unmet medical need to allow for a well-defined development path to approval and commercial opportunity. As a result of this analysis, in the fourth quarter of 2015 Idera announced the selection of NLRP3 (NOD-like receptor family, pyrin domain containing protein 3) and DUX4 (Double Homeobox 4) as initial gene targets to advance into IND-enabling activities, which will occur throughout 2016. Potential disease indications include, but are not limited to interstitial cystitis, uveitis and facioscapulohumeral muscular dystrophy (FSHD), respectively. The company is currently conducting clinical and regulatory pathway and commercial analysis activities and conducting IND-enabling studies with the plan to enter the clinic in 2017 for the first disease indication.

Financial Results

First Quarter 2016 Results

Net loss for the three months ended March 31, 2016 was $12.8 million, or $0.11 per basic and diluted share, compared to a net loss of $12.5 million, or $0.12 per basic and diluted share, for the same period in 2015. There was nominal revenue recognized in each of the first quarters of 2016 and 2015. Research and development expenses for the three months ended March 31, 2016 totaled $9.3 million compared to $8.7 million for the same period in 2015. General and administrative expense for the three months ended March 31, 2016 totaled $3.9 million compared to $3.8 million for the same period in 2015.

As of March 31, 2016, Idera’s cash, cash equivalents and investments totaled $74.1 million compared to $87.2 million as of December 31, 2015. The company expects the current cash position and investments to fund its operations into the third quarter of 2017.

Investor Event and Webcast

Idera will host a conference call and live webcast on Monday, May 9, 2016 at 5:00 P.M. EST to provide an update on the company’s progress and to provide an overview of additional clinical activity from the ongoing Phase 1/2 clinical trial of IMO-8400 in Waldenstrom’s Macroglobulinemia. To participate in the conference call, please dial (844) 882-7837 (domestic) and (574) 990-9824 (international). The webcast can be accessed live or in archived form in the "Investor’s" section of the company’s website at www.iderapharma.com.

On May 9, 2016 Aeterna Zentaris Inc. (NASDAQ: AEZS) (TSX: AEZ) (the "Company"), a specialty biopharmaceutical company engaged in developing and commercializing novel treatments in oncology, endocrinology and women’s health, reported financial and operating results for the first quarter ended March 31, 2016 (Press release, AEterna Zentaris, MAY 9, 2016, View Source [SID:1234512147]).

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Commenting on first quarter results, David A. Dodd, Chairman, President and Chief Executive Officer of the Company, stated, "During the first quarter, we made steady progress in the areas of product development, commercial performance and financial operations. I am pleased to report that we remain on track to attain our 2016 corporate objectives. We still expect to complete the pivotal Phase 3 Zoptrex trial in Q3 of 2016 and to report top-line results by year-end."

Mr. Dodd continued his commentary with a discussion of the development of Macrilen, which, if approved, will be the only FDA-approved means of evaluating adult growth hormone deficiency (AGHD), "Since announcing patient recruitment in the fourth quarter of last year, our CRO has opened approximately 20 of our anticipated 30 sites, enrolling approximately 30 patients. The pace of recruitment is accelerating, confirming our expectation that the confirmatory Phase 3 clinical study of Macrilen will be concluded in Q3 of 2016, also with top-line results being reported as soon as possible following trial conclusion. We feel very confident that the confirmatory study, which will consist of approximately 30 sites and a minimum of 110 patients, is on schedule."

Concluding, Mr. Dodd addressed the Company’s commercial operations, stating, "We are pleased with the building of success from our promotion of Saizen during the first quarter. Exceeding our baseline by 66% during the quarter was a great accomplishment by our sales team. Now that they have a number of targets that more closely matches our promotional capacity, we believe they should be in a position to produce meaningful commission revenue this year. I am hopeful that we will be able to add even more targets as EMD Serono recognizes the success of our efforts. Our full sales force sold APIFINY for only half of the first quarter but managed to generate commission revenue nevertheless. We are hopeful about the commercial potential of APIFINY because it is the only cancer-specific, non-PSA blood test for the evaluation of the risk of prostate cancer. Physicians have long needed such an adjunct to the PSA test. With APIFINY, we believe we can satisfy that need. As a result of our promotional efforts, we are realizing an increasing penetration and acceptance of APIFINY. More recently, we announced the expansion of our APIFINY agreement to reflect our exclusive rights to promote this product throughout the U.S. We believe that such an expanded agreement opens significant revenue opportunities in support of this exciting product."

First Quarter 2016 Financial Highlights

R&D costs were $3.7 million for the three-month period ended March 31, 2016, compared to $4.5 million for the same period in 2015. The decrease for the three-month period ended March 31, 2016, as compared to the same period in 2015, is mainly attributable to lower comparative third-party costs. The decrease in third-party costs is mainly attributable to the fact that the number of patients in active treatment in the clinical trial for Zoptrex was lower in the first quarter of 2016, as compared to the same period in 2015. The overall decrease in R&D costs is also explained by lower employee compensation and benefits costs, lower facilities rent and maintenance as well as lower other costs. A substantial portion of this decrease is due to the realization of cost savings in connection with our effort to streamline our R&D activities and to increase our commercial operations and flexibility by reducing our R&D staff, which was started in 2014 (the "Resource Optimization Program"), for which a provision was recorded in the third quarter of 2014.

G&A expenses were $1.9 million for the three-month period ended March 31, 2016, as compared to $3.4 million for the same period in 2015. The decrease is mainly attributable to the recording during three-month period ended March 31, 2015 of certain transaction costs associated with the completion of a public, registered offering of shares and warrants in March 2015.

Selling expenses were $1.7 million for the three-month period ended March 31, 2016, essentially unchanged as compared to the same period in 2015. The selling expenses for the three-month periods ended March 31, 2016 and 2015 represent the costs of our contracted sales force related to the co-promotion activities as well as our internal sales management team. Those activities were launched during the fourth quarter of 2014.

Net loss for the three-month period ended March 31, 2016 was $3.7 million, or $0.37 per basic and diluted share, compared to a net loss of $9.7 million, or $13.59 per basic and diluted share for the same period in 2015. The decrease in net loss for the three-month period ended March 31, 2016, as compared to the same period in 2015, is due largely to lower operating expenses and higher comparative net finance income.

Cash and cash equivalents were approximately $33.0 million as at March 31, 2016, compared to $41.5 million as at December 31, 2015.

On May 9, 2016 Verastem, Inc. (NASDAQ:VSTM), focused on discovering and developing drugs to treat cancer, reported financial results for the first quarter ended March 31, 2016, and also provided an overview of certain corporate developments (Press release, Verastem, MAY 9, 2016, View Source;p=RssLanding&cat=news&id=2166539 [SID:1234512196]).

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"To date in 2016, Verastem has announced two new clinical collaborations with world-class organizations, including Merck KGaA and Pfizer, and Washington University in St. Louis and Merck & Co., to further elucidate the potential of FAK inhibition to enhance the efficacy of PD-(L)1 inhibitors in patients with pancreatic and ovarian cancer," said Robert Forrester, President and Chief Executive Officer of Verastem. "The data generated from these trials will continue to inform the ongoing development of our anti-cancer therapeutics which reduce cancer stem cells and modulate the local tumor microenvironment to allow both cancer treatments and the immune system to do their job more efficiently. We’ve had a strong start to 2016 with the announcement of these clinical collaborations in addition to attracting key strategic hires on the development team, including Dr. Greg Berk as Chief Medical Officer and Dr. Toyin Shonukan as Vice President of Clinical Development, to oversee and execute on our ongoing and future studies. We are well financed with approximately $100 million in available capital and we look forward to keeping you updated in the coming quarters on our progress."

First Quarter 2016 and Recent Highlights:
Focal Adhesion Kinase Inhibition Program
Clinical Collaboration with Pfizer and Merck KGaA to Evaluate Combination of VS-6063 and Avelumab in Ovarian Cancer – In March 2016, the companies announced a clinical trial collaboration agreement to evaluate the combination of Verastem’s focal adhesion kinase (FAK) inhibitor VS-6063 and Pfizer and Merck KGaA’s anti-PD-L1 immunotherapy avelumab. Verastem has previously reported initial signs of clinical activity in patients with ovarian cancer when VS-6063 is used in combination with paclitaxel. Under the terms of the agreement, the parties will conduct a planned Phase 1/1b clinical trial evaluating escalating doses of the combination of VS-6063 and avelumab as a potential treatment option for patients with advanced ovarian cancer.

Washington University in St. Louis Initiated a Clinical Study of VS-6063 in Combination with Merck & Co.’s Pembrolizumab and Gemcitabine in Pancreatic Cancer – In January 2016, Verastem announced the initiation of a Phase 1 dose-escalation study at Washington University to evaluate its FAK inhibitor VS-6063 in combination with Merck & Co.’s anti-PD-1 immunotherapy pembrolizumab and gemcitabine in patients with pancreatic cancer. The trial builds upon preclinical research conducted by Dr. David Denardo, presented at several conferences in late 2015 and early 2016, demonstrating the ability of FAK inhibition to increase the efficacy of checkpoint inhibition in the reduction of tumor volume and overall survival in models of pancreatic cancer. This Phase 1 clinical trial is currently enrolling and is anticipated to enroll approximately 50 patients with advanced pancreatic cancer.

Presented Scientific Data Supporting FAK Inhibition in Combination with Immunotherapy at Key Medical Meetings – During the first quarter of 2016, Verastem presented data in support of its new development programs focused on advancing its FAK inhibitors in combination with immune-oncology agents and other current and emerging standard of care cancer treatments. Data were presented at several medical and scientific meetings, including the 2016 American Academy of Cancer Research (AACR) (Free AACR Whitepaper), the Society for Gynecologic Oncology’s 2016 Annual Meeting on Women’s Cancer, the Keystone Symposium on Cancer Pathology, the Keystone Symposium on Stem Cells and Cancer, and Immunotherapy World 2016.

Presented Clinical Data from the Window of Opportunity Study at iMig 2016 – In May 2016, the Company announced results from the ongoing open-label, single-center, neoadjuvant Window of Opportunity study evaluating tolerability, along with biomarker and tumor volume response to VS-6063 (400mg BID) following either 12 days (Cohort 1) or 35 days (Cohort 2) of treatment in surgically-eligible patients with malignant pleural mesothelioma. Data analysis from Cohort 1 and Cohort 2 showed that VS-6063 was generally well tolerated with early signs of tumor reduction observed, with six of the twenty patients demonstrating an encouraging tumor reduction after brief treatment with VS-6063.

Development of VS-4718 Continues in Solid Tumors – Dosing continues in a Phase 1 dose escalation trial evaluating single-agent VS-4718 and a Phase 1 clinical trial evaluating VS-4718 in combination with gemcitabine and Abraxane is currently ongoing. Following results from the dose escalation trial, an expansion cohort of VS-4718 + Gemcitabine/Abraxane vs Gemcitabine/Abraxane alone in patients with pancreatic cancer is planned.

Dual PI3K/mTORC1/2 Inhibition Program
Confirmatory Recommended Phase 2 Dose and Expansion Cohorts – The maximum tolerated dose of single-agent VS-5584 has been reached in a Phase 1 study, and the recommended Phase 2 dose (RP2D) is being confirmed. Reductions in pharmacodynamic markers of PI3K and mTOR activity and clinical activity has been observed in some tumor types.

Corporate
Gregory I. Berk, MD Named Chief Medical Officer – In April 2016, the Company announced the appointment of Gregory I. Berk, MD as Chief Medical Officer. Dr. Berk, a highly accomplished physician and a well-regarded oncology veteran with more than 25 years of both industry and academic experience, will be responsible for leading the Company’s global clinical development strategy and clinical operations.

Announced Key Executive Management Appointments and Changes – In April 2016, the Company strengthened its management team through the appointment and promotion of several key individuals. Jonathan Pachter, PhD was promoted to Chief Scientific Officer, David Weaver, PhD was appointed Vice President, Translational Medicine, Joe Chiapponi, Vice President, Finance, was named Treasurer, Principal Accounting and Financial Officer and Oluwatoyin (Toyin) Shonukan, MD, has been appointed Vice President, Clinical Development. Dr. Shonukan most recently served as Senior Medical Director, Oncology Clinical Development at Vertex Pharmaceuticals and has held previous senior appointments at Millennium: The Takeda Oncology Company, Novartis Oncology and Eli Lilly.

First Quarter 2016 Financial Results
Net loss for the first quarter ended March 31, 2016 (2016 Quarter) was $8.3 million, or $0.22 per share, as compared to a net loss of $15.2 million, or $0.46 per share, for the first quarter ended March 31, 2015 (2015 Quarter). Net loss for the 2016 Quarter and 2015 Quarter, excluding non-cash stock-based compensation expense of $1.7 million and $2.9 million, was $6.6 million and $12.3 million, respectively.

Research and development expense for the 2016 Quarter was $4.2 million compared to $10.5 million for the 2015 Quarter. The $6.3 million decrease from the 2015 Quarter to the 2016 Quarter was primarily related to a decrease of $4.2 million in contract research organization expense for outsourced biology, chemistry, development and clinical services, which includes our clinical trial costs, a decrease in personnel related costs of $1.4 million, a decrease of approximately $550,000 in stock-based compensation, and a decrease of approximately $441,000 in travel, facilities and other research and development costs. These decreases were partially offset by an increase of approximately $276,000 in consulting fees.

General and administrative expense for the 2016 Quarter was $4.3 million compared to $4.7 million for the 2015 Quarter. The decrease of approximately $400,000 from the 2015 Quarter to the 2016 Quarter primarily resulted from approximate decreases in stock-based compensation expense of $734,000 and $148,000 in personnel related costs. These decreases were offset by an increase of approximately $411,000 in consulting and professional fees.

As of March 31, 2016, Verastem had cash, cash equivalents and investments of $99.5 million compared to $110.3 million as of December 31, 2015. Verastem used $10.8 million for operating activities during the 2016 Quarter settling one-time compensation payments, severance payments and paying down accounts payable and accruals.
The number of outstanding common shares as of March 31, 2016, was 36,992,418.

Financial Guidance
Based on current operating plans, we expect to have sufficient cash, cash equivalents and short-term investments to fund our research and development programs and operations into 2018.

About Focal Adhesion Kinase
Focal Adhesion Kinase (FAK) is a non-receptor tyrosine kinase encoded by the PTK-2 gene that is involved in cellular adhesion and, in cancer, metastatic capability. VS-6063 (defactinib) and VS-4718 are orally available compounds that are potent inhibitors of FAK. VS-6063 and VS-4718 utilize a multi-faceted approach to treat cancer by reducing cancer stem cells, enhancing anti-tumor immunity, and modulating the local tumor microenvironment. VS-6063 and VS-4718 are currently being studied in multiple clinical trials for their ability to improve patient survival.

About VS-5584
VS-5584 is an orally available compound that has demonstrated potent and highly selective activity against class 1 PI3K enzymes and dual inhibitory actions against mTORC1 and mTORC2. In preclinical studies, VS-5584 has been shown to reduce the percentage of cancer stem cells and induce tumor regression in chemotherapy-resistant models. Verastem is currently conducting a dose escalation trial of VS-5584 in patients with advanced solid tumors.