On March 10, 2016 Verastem, Inc. (NASDAQ:VSTM), focused on discovering and developing drugs to treat cancer, reported the presentation of preclinical data and participation in an expert panel at the Keystone Symposium on Stem Cells and Cancer being held March 6 – 10, 2016 in Breckenridge, CO (Press release, Verastem, MAR 10, 2016, View Source;p=RssLanding&cat=news&id=2147460 [SID:1234509470]).

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"The scientific consensus on the importance of targeting cancer stem cells to enable a durable clinical response continues to build," said Dr. Jonathan Pachter, Verastem Head of Research. "Our presentation at the Keystone Symposium describes our current understanding of the role of PI3K/mTOR and FAK in the survival and tumor-initiating capability of cancer stem cells."

"Of particular interest, we have also found that FAK inhibition increases influx of cytotoxic T cells into tumors while reducing immuno-suppressive and stromal density barriers to anti-tumor immune attack," continued Dr. Pachter. "New data from preclinical models presented today demonstrate that FAK inhibition enhances the anti-tumor effect of adoptive T cell transfer. These data suggest that the benefit of FAK inhibitor combination is likely to extend to various approaches that enhance cytotoxic T cell function, including combination with antibodies against PD-1 and PD-L1. We are now clinically testing this with the combination of VS-6063 and pembrolizumab at Washington University in Saint Louis in patients with advanced pancreatic cancer. We also recently announced a clinical collaboration with Pfizer and Merck KGaA to combine VS-6063 and avelumab for the treatment of patients with ovarian cancer."

Details for the presentation at the Keystone Symposium on Stem Cells and Cancer are as follows:
Oral Presentation and Panel
Title: Targeting Cancer Stem Cells with Selective Inhibitors of FAK and PI3K/mTOR
Session: Targeting Cancer Stem Cells: Trials and Translation
Date and time: Thursday, March 10, 2016, 8:00 – 11:00 am PT
A copy of the oral presentation will be available following the presentation at http://bit.ly/R3M6wc.
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 patients with cancer.
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.

On March 10, 2016 Five Prime Therapeutics, Inc. (Nasdaq:FPRX), a clinical-stage biotechnology company focused on discovering and developing innovative immuno-oncology protein therapeutics, reported a corporate update and reported financial results for the fourth quarter and full year ending December 31, 2015 (Press release, Five Prime Therapeutics, MAR 10, 2016, View Source [SID:1234509475]).

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"2015 was a transformational year for Five Prime," said Lewis T. "Rusty" Williams, M.D., Ph.D., president and chief executive officer of Five Prime. "Of note, our license and collaboration agreement with Bristol-Myers Squibb (BMS) maximizes the clinical and commercial potential of FPA008 and the exceptional terms have strengthened our financial position. In addition, we are encouraged by the early safety and efficacy data from FPA144 in patients with gastric cancer, and we look forward to assessing its potential in other indications. Beyond our clinical programs, we also made progress in our internal immuno-oncology research programs, and continue to be on track to file an IND application in 2017."

2015 Business Highlights and Recent Developments

Clinical Development:

FPA008: an investigational antibody that inhibits CSF1R and has been shown in preclinical models to block the activation and survival of monocytes and macrophages.

Established Exclusive Worldwide License and Collaboration Agreement with BMS for FPA008. In October 2015, Five Prime and BMS entered into an exclusive worldwide license and collaboration agreement for the development and commercialization of FPA008. Five Prime received a $350 million upfront payment during the fourth quarter and is eligible to receive up to $1.4 billion in development and regulatory milestone payments as well as royalty percentages ranging from the high teens to the low twenties on future worldwide net sales of FPA008. Five Prime also has an option to co-promote FPA008 in the United States.

Initiated Phase 1a/1b FPA008/OPDIVO Combination Trial. In September 2015, Five Prime initiated patient dosing in the Phase 1a/1b clinical trial evaluating the safety, tolerability and preliminary efficacy of the immunotherapy combination of FPA008 with OPDIVO (nivolumab), BMS’s PD-1 immune checkpoint inhibitor. Five Prime expects to expand into Phase 1b in multiple tumor settings in the second half of 2016.

Initiated Phase 1/2 Clinical Trial of FPA008 in Pigmented Villonodular Synovitis (PVNS). In the third quarter of 2015, Five Prime initiated patient dosing in its Phase 1/2 clinical trial in PVNS, a CSF1R-driven tumor and an orphan indication. The company expects to begin Phase 2 expansion, which will evaluate tumor response rate and duration as well as measures of pain and joint function, in mid-2016. The company submitted an epidemiology study focusing on the incidence and prevalence of this rare disease for presentation at the 2016 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting.

FPA144: an anti-FGF receptor 2b (FGFR2b) Monoclonal Antibody Engineered to Recruit NK Cells into the Tumor Microenvironment. During the fourth quarter of 2015, Five Prime completed dose escalation in the ongoing Phase 1 trial of single-agent FPA144 and began dose expansion at a selected dose in new cohorts of gastric cancer patients whose tumors overexpress FGFR2b. In January 2016, Five Prime presented preliminary data from the dose escalation portion of the trial at the ASCO (Free ASCO Whitepaper) Gastrointestinal Cancers Symposium, which showed:

Two partial responses in six gastric cancer patients with IHC 3+ FGFR2b-positive gastric cancer;

A partial response in a patient whose bladder cancer overexpressed FGFR2b; and

FPA144 was well tolerated and differentiated from small molecule kinase inhibitors targeting the pathway, which often cause hyperphosphatemia and other dose-limiting toxicities.

Based on results to date, Five Prime continues to evaluate FPA144 as a monotherapy in refractory gastric cancer, as a combination therapy for gastric cancer, and as a potential treatment for other types of cancer. The company submitted an abstract for presentation at the ASCO (Free ASCO Whitepaper) 2016 Annual Meeting in June and will present preclinical data regarding FPA144’s ability to reprogram immune cells in the tumor microenvironment at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting in April 2016.

FP-1039/GSK3052230, an FGF Ligand Trap. GlaxoSmithKline (GSK) presented data from the ongoing open-label Phase 1b trial in patients with squamous non-small cell lung cancer (sqNSCLC) and mesothelioma at the World Conference on Lung Cancer in September 2015. In January 2016, GSK and Five Prime agreed to stop enrollment in the sqNSCLC patient cohorts given the change in treatment paradigms following approvals of immuno-oncology agents and the increasingly competitive landscape in sqNSCLC. In addition, the companies agreed that GSK would continue to enroll mesothelioma patients based on encouraging preliminary data from the mesothelioma arm of the trial.

On March 9, 2016, GSK notified Five Prime that it was providing 180-day notice of termination of the FP-1039 license and collaboration agreement for convenience. Five Prime plans to work with GSK to ensure completion of enrollment in the ongoing mesothelioma arm of the Phase 1b study and to transfer the asset and program back to Five Prime. Five Prime continues to be encouraged by the progress of this Phase 1b trial. Mesothelioma could represent a potentially attractive market opportunity for a company like Five Prime. Five Prime will base decisions on future development of FP-1039 on whether the quality and durability of responses in this population is maintained in this trial. GSK has submitted mesothelioma data for presentation at the ASCO (Free ASCO Whitepaper) 2016 Annual Meeting.

Preclinical Research and Development:

Progressed Internal Immuno-Oncology Research Programs. During 2015, Five Prime continued to expand its immuno-oncology research efforts and advanced multiple candidates into preclinical development. The company continues to be on track to file an IND application in 2017.

Established New GITR Agonist Program. Five Prime in-licensed novel, potentially best-in-class, multivalent glucocorticoid-induced tumor necrosis factor receptor (GITR) antibodies from Inhibrx during the third quarter of 2015. Their unique multivalent format facilitates clustering of GITR on T cells, which should result in superior T cell activation compared to conventional antibodies.

Enhanced the Company’s Ability to Generate Therapeutic Antibodies and Move Them More Rapidly Toward IND Applications. In October 2015, Five Prime secured a license from Open Monoclonal Technology (OMT) to access mono- and bi-specific antibody platforms and antibody repertoire sequencing technology for the generation of novel therapeutic candidates. In December 2015, Five Prime obtained a license from Xoma Ltd. to one of Xoma’s proprietary phage display libraries for antibody discovery.

Other Licenses and Collaborations:

Entered into License Agreement with bluebird bio for Antibodies to Develop CAR T Cell Therapy. In May 2015, Five Prime granted an exclusive license to bluebird bio to research, develop and commercialize chimeric antigen receptor (CAR) T cell therapies using Five Prime’s proprietary human antibodies to an undisclosed target for hematologic malignancies and solid tumors. The agreement included a $1.5 million upfront payment and subsequent milestone payments to Five Prime, which together could total over $130 million per licensed product if certain development, regulatory, and commercial milestones are achieved. Five Prime is also eligible to receive tiered royalties on product sales.

GSK Exercised Options to Reserve Multiple Protein Targets Discovered by Five Prime for Respiratory Disease. GSK paid Five Prime $600,000 in target reservation fees.

Finance:

Completed Public Offering of Common Stock. In January 2015, Five Prime completed an underwritten public offering of common stock, raising net proceeds of $78.7 million.

Summary of Financial Results and Guidance:

Cash Position. Cash, cash equivalents and marketable securities totaled $517.5 million on December 31, 2015 compared to $149.1 million on December 31, 2014. The increase in year-end 2015 cash was primarily attributable to the $350 million upfront payment received in December 2015 from BMS for the FPA008 license and collaboration agreement.

Revenue. Collaboration revenue for the fourth quarter of 2015 increased by $358.7 million to $363.3 million from $4.6 million in the fourth quarter of 2014, primarily due to revenue recognized under the FPA008 license and collaboration agreement with BMS. Collaboration revenue for the full year 2015 increased by $360.6 million to $379.8 million in 2015 from $19.2 million in 2014 primarily due to revenue recognized under the collaborations with BMS, UCB and GSK.

R&D Expenses. Research and development expenses for the fourth quarter of 2015 increased by $8.4 million, or 67%, to $21.0 million from $12.6 million in the fourth quarter of 2014. Full year 2015 research and development expenses increased by $27.0 million, or 63%, to $70.2 million in 2015 from $43.2 million in 2014. This increase was primarily related to advancing the FPA008 program in immuno-oncology and PVNS, and advancing internal immuno-oncology research and preclinical activities, including expenses related to in-licensing GITR antibodies.

G&A Expenses. General and administrative expenses for the fourth quarter of 2015 increased by $4.6 million, or 115%, to $8.6 million from $4.0 million in the fourth quarter of 2014. Full year 2015 general and administrative expenses were $22.6 million, an increase of $9.0 million, or 66%, from $13.6 million in 2014. This increase was primarily due to increases in personnel related expenses, including stock-based compensation, facility costs and recruiting related to expansion of operations.

Net Income (Loss). Net income for the fourth quarter of 2015 was $296.1 million, or $11.37 per basic share and $10.63 per diluted share, compared to a net loss of $11.8 million, or $0.55 per basic and diluted share, for the fourth quarter of 2014. Full year 2015 net income was $249.6 million, or $9.73 per basic share and $9.23 per diluted share, compared to a net loss of $37.4 million, or $1.79 per basic and diluted share in 2014. These increases in net income were primarily related to the revenue recognized under the FPA008 license and collaboration agreement with BMS.

Cash Guidance. Five Prime expects full-year 2016 net cash used in operating activities to be less than $120 million, comprising less than $90 million used in operations and less than $30 million used for tax payments. The company estimates ending 2016 with approximately $400 million in cash, cash equivalents and marketable securities.

On March 10, 2016 Immune Design (Nasdaq:IMDZ), a clinical-stage immunotherapy company focused on oncology, reported financial results and a corporate update for the fourth quarter and full year ended December 31, 2015 (Press release, Immune Design, MAR 10, 2016, View Source [SID:1234509478]).

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Corporate Update and Recent Highlights

New positive data support continued development of Immune Design’s wholly-owned immuno-oncology product candidates.

LV305, the novel vector component of CMB305 that delivers NY-ESO-1 RNA specifically to dendritic cells in vivo, has achieved full patient enrollment in the Phase 1 study as a single agent. Updated data reveal:

A consistently favorable safety profile;

A consistent T cell immune response rate; and

An improved clinical benefit profile using progression-free survival (PFS) as an endpoint.

CMB305, a first-in-class prime-boost immunotherapy combining LV305 and G305, has completed a first-in-human dose-escalation study and is currently undergoing an expansion study as a single agent in patients with cancers expressing the NY-ESO-1 tumor antigen. Initial data indicate:

A favorable safety profile;

A large subset of patients generate or increase CD4 and CD8 T cells responses against NY-ESO-1; a boost effect is observed following G305 administration; and the T cell response appears more robust than that seen in the LV305 Phase 1 trial; and

Preliminary clinical benefit in the form of progression-free rate (PFR) in patients with soft tissue sarcoma.

Immune Design has received notification of orphan drug designation for soft tissue sarcoma for both components of CMB305 (LV305 and G305) in the United States and European Union.

G100, an intratumoral immune activation product candidate comprised of the TLR4 agonist, GLA, completed a Phase 1 study of patients with Merkel cell carcinoma. Building upon data previously reported in a subset of patients, the full data set from the completed trial reveal:

A consistently favorable safety profile;

Evidence of changes in the tumor microenvironment causing inflammation and transforming tumors to a "hot" state in G100-responding patients; and

Clinical benefit remained constant with the full patient set.

This, in addition to the positive preclinical data presented at the 57th American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting through a collaboration with Dr. Ron Levy’s lab using the A20 NHL model, support the recently initiated Ph1/2 randomized trial testing G100 with or without KeytrudaTM in patients with NHL.

Abstracts for each of these three studies have been submitted for presentation at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting (June 3-7, 2016).

New data continue to build on the potential of the GLAASTM platform outside of oncology.

In addition to the ongoing Phase 2 study of MEDI7510, MedImmune’s investigational agent for the prevention of Respiratory Syncytial Virus (RSV) that leverages the GLAAS platform, Immune Design presented data at the 2016 American Academy of Allergy, Asthma & Immunology (AAAI) Annual Meeting in March highlighting the ability of GLA to modify the abnormal allergic immune response observed in peripheral blood from patients with pollen allergies. These data build upon additional data showing the potential of the GLAAS platform to treat food allergies, as supported by the licensing agreement with Sanofi to develop therapeutic agents to treat peanut food allergy.
Financial Results

Full Year 2015

Immune Design ended the fourth quarter of 2015 with $112.9 million in cash and cash equivalents, compared to $75.4 million as of December 31, 2014. Net cash used in operations for the year ended December 31, 2015 was $37.8 million.

Net loss and net loss per share for the year ended December 31, 2015 were $39.4 million and $2.06, respectively, compared to $34.2 million and $4.56, respectively, for the same period in 2014.

Revenue for the year ended December 31, 2015 was $9.5 million and was attributable primarily to $4.2 million in collaboration revenue associated with the Sanofi Pasteur G103 collaboration established in the fourth quarter of 2014, $3.5 million in license revenue associated with the company’s collaborations with MedImmune and Sanofi Aventis, and $1.9 million in product sales. Revenue for the same period in 2014 was $6.4 million and was primarily attributable to $4.5 million in license revenue associated with Immune Design’s collaborations with MedImmune and Sanofi Aventis, $1.1 million in collaboration revenue associated with the Sanofi G103 collaboration established in the fourth quarter of 2014, and $0.8 million in product sales.

Research and development expenses for the year ended December 31, 2015 were $33.1 million, compared to $22.7 million for the same period in 2014. The $10.3 million increase was primarily attributable to continuing advancement of our ongoing research and development programs and Phase 1 and Phase 2 clinical trials. Research and development stock-based compensation (a non-cash expense), was $2.2 million for the year ended December 31, 2015.

General and administrative expenses for the year ended December 31, 2015 were $15.1 million, compared to $12.9 million for the same period in 2014. The increase of $2.2 million is primarily attributable to an increase in professional services fees, personnel and facility related expenses to support operations as a public company. General and administrative stock-based compensation (a non-cash expense), was $4.1 million for the year ended December 31, 2015.

Fourth Quarter

Net loss and net loss per share for the fourth quarter of 2015 were $12.1 million and $0.60, respectively, compared to $13.1 million and $0.78, respectively, for the fourth quarter of 2014.

Revenue for the fourth quarter of 2015 was $1.1 million and was attributable primarily to $0.9 million in product sales, and $0.2 million in collaboration revenue associated with the Sanofi Pasteur G103 collaboration established in the fourth quarter of 2014. Revenue for the fourth quarter of 2014 was $1.8 million and was attributable primarily to $0.7 million in product sales, and $1.1 million in collaboration revenue associated with Sanofi Pasteur G103 collaboration established in the fourth quarter of 2014.

Research and development expenses for the fourth quarter of 2015 were $8.9 million, compared to $8.8 million for the fourth quarter of 2014.

General and administrative expenses for the fourth quarter of 2015 were $4.0 million, compared to $5.5 million for the fourth quarter of 2014. The decrease of $1.5 million is primarily attributable to a decrease in legal and litigation costs.

On March 10, 2016 Trillium Therapeutics Inc. (NASDAQ:TRIL; TSX: TR) a clinical stage immuno-oncology company developing innovative therapies for the treatment of cancer, reported that it has entered into a collaboration agreement with University Health Network and the Hospital for Sick Children to fund and undertake a research program entitled "SIRPaFc: Translating Genomics Research Into a Novel Cancer Immunotherapy (Press release, Trillium Therapeutics, MAR 10, 2016, View Source [SID:1234509482])." Importantly, this project has been approved for funding by Genome Canada under the Genomic Applications Partnership Program (GAPP). In addition, The Ontario Ministry of Research and Innovation is supporting the project with a grant matching Genome Canada’s contribution, providing the collaboration with a 3-year budget of approximately $3.4 million.

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"Predictive prognostic or pharmacodynamic biomarkers are critical for the development of new therapeutic cancer agents, especially those targeting the immune system," commented Trillium’s Chief Executive Officer, Dr. Niclas Stiernholm. "This new matching funding will allow us to substantially expand our translational research efforts, focusing primarily on acute myeloid leukemia, which is ultimately likely to enhance our clinical programs."

Trillium’s lead program, TTI-621, is currently being tested as a single-agent in patients with relapsed or refractory hematologic malignancies. During the dose escalation phase set to enroll up to 36 subjects, we intend to characterize the safety, tolerability, pharmacokinetics and pharmacodynamics to determine the optimal dose for subsequent enrollment in the expansion phase. In this second part of the trial, we intend to explore the safety and preliminary antitumor activity of TTI-621 at the optimal dose identified in the escalation phase in 12–15 subjects per hematologic malignancy type: indolent B-cell lymphoma, aggressive B-cell lymphoma, T-cell lymphoma, Hodgkin lymphoma, chronic lymphocytic leukemia, multiple myeloma, acute myeloid leukemia, and myelodysplastic syndrome.

On March 10, 2016 Threshold Pharmaceuticals, Inc. (Nasdaq:THLD), a clinical-stage biopharmaceutical company developing novel therapies for cancer, reported financial results for the fourth quarter and year ended December 31, 2015 and provided an update on the Company’s corporate and clinical development activities (Press release, Threshold Pharmaceuticals, MAR 10, 2016, View Source [SID:1234509483]).

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"A key focus for Threshold has been to analyze all of the evofosfamide clinical data to determine whether there might be a path forward in patients with pancreatic cancer as well as other cancer indications," said Barry Selick, Ph.D., Chief Executive Officer of Threshold. "We have finalized an agreement with Merck KGaA, Darmstadt, Germany to license back all rights to evofosfamide and, based upon a detailed ongoing analysis of the data from the Phase 3 MAESTRO trial, we have seen a meaningful improvement in median overall survival and other secondary efficacy endpoints in the 116 Japanese patients with pancreatic cancer who were enrolled in that trial."

Corporate Highlights
On March 10, 2016, the Company terminated the global license and co-development agreement (License Agreement) with Merck KGaA, Darmstadt, Germany, originally entered into February 2, 2012 for evofosfamide, Threshold’s investigational hypoxia-activated prodrug of a cytotoxic DNA-alkylating agent. Under the terms of the Termination Agreement, all rights to evofosfamide under the original agreement were returned to Threshold, as well as all rights to Merck KGaA, Darmstadt, Germany technology developed under the License Agreement. The Termination Agreement provides tiered royalties on sales and milestone payments to Merck KGaA, Darmstadt, Germany contingent upon the future successful development and commercialization of evofosfamide.

In January 2016 at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) 2016 Gastrointestinal Cancers Symposium (ASCO GI), Merck KGaA, Darmstadt, Germany’s analysis of the results from the Phase 3 MAESTRO trial were presented. While the primary efficacy endpoint of overall survival narrowly missed statistical significance, secondary efficacy endpoints of progression-free survival and confirmed overall response rates demonstrated significant improvements for patients treated with gemcitabine plus evofosfamide (the "treatment arm") compared to gemcitabine plus placebo (the "control arm"). No new safety findings were identified in the MAESTRO study and the safety profile was consistent with that previously reported in other studies of evofosfamide plus gemcitabine.

As previously reported, a meaningful improvement in overall survival was reported for the subgroup of 123 Asian patients enrolled at Japanese and South Korean sites in which the risk of death was reduced by 42 percent for patients on the treatment arm compared to patients on the control arm with an associated hazard ratio of 0.58 (95% CI: 0.36 – 0.93).

Of particular note, based upon Merck KGaA, Darmstadt, Germany’s MAESTRO data, the Company reported that the 116 patients from Japan from the treatment arm had a median overall survival of 13.6 months compared to 9.1 months for those patients in the control arm. The patients from Japan also had significant improvements in progression free survival, objective response rates, and reductions in the pancreatic cancer biomarker, CA19-9.

The Company is conducting additional analyses of data from the MAESTRO study in pancreatic cancer and intends to discuss potential registration pathways with health regulatory authorities. While the Company has ongoing clinical development collaborations investigating evofosfamide in patients with pancreatic neuroendocrine tumors (pNET), recurrent glioblastoma (GBM) and hepatocellular carcinoma (HCC), it has suspended the development of evofosfamide in various other tumor types.

"The detailed analysis of the MASTRO data combined with our previous Phase 2 experience strongly suggests that evofosfamide plus gemcitabine is an active regimen in patients with pancreatic cancer, most notably in the Japanese patients, and we look forward to being able to share our future plans based on these data," added Dr. Selick. "Beyond evofosfamide, we continue to make progress with our two Phase 2 proof-of-concept trials of tarloxotinib, our hypoxia-activated EGFR tyrosine kinase inhibitor, and plan to share preliminary results of those clinical trials in mid-2016."

Fourth Quarter and Year End 2015 Financial Results

As of December 31, 2015 and 2014, Threshold had $48.7 million and $58.6 million in cash, cash equivalents and marketable securities, respectively. The net decrease of $9.9 million in cash, cash equivalents and marketable securities during 2015 is primarily due to the Company’s operating cash requirements for 2015, partially offset by the $28.1 million in net proceeds from our public offering in February 2015 and $0.7 million in cash proceeds from the exercise of stock options and purchase rights related to our stock-based equity incentive plans.

Revenue for the fourth quarter and year ended December 31, 2015 was $65.9 million and $76.9 million, respectively, compared to $3.7 million and $14.7 million for the same periods in 2014, respectively. Revenue for the years ended December 31, 2015 and December 31, 2014, related to the amortization of the aggregate of $110 million in upfront and milestone payments earned in 2013 and 2012 from the Company’s collaboration with Merck KGaA, Darmstadt, Germany. The revenue from the upfront payment and milestone payments earned under the agreement was previously being amortized over the relevant performance period, rather than being immediately recognized when the upfront payment and milestone were earned or received. As a result of Merck KGaA, Darmstadt, Germany’s and our decision to cease further joint development of evofosfamide in December 2015, we immediately recognized $65.9 million of the remaining deferred revenue into revenue during the quarter ending December 31, 2015. Also as a result of the termination of the agreement, we are no longer eligible to receive any further milestone payments from Merck KGaA, Darmstadt, Germany.

Research and development expenses were $11.4 million for the fourth quarter ended December 31, 2015, compared to $8.6 million for the same period in 2014. The increase in research and development expenses, net of reimbursement for Merck KGaA, Darmstadt, Germany’s 70% share of total development expenses for evofosfamide, was due primarily to a $1.2 million increase in employee related expenses, including a $0.3 million increase in non-cash stock-based compensation expense and a $1.6 million increase in clinical development expenses and consulting expenses. Research and development expenses were $40.3 million for 2015, compared to $35.8 million in 2014. The increase in research and development expenses, net of reimbursement for Merck KGaA, Darmstadt, Germany’s 70% share of total development expenses for evofosfamide, was due primarily to a $2.1 million increase in clinical development expenses and an increase of $2.7 million in employee related expenses, including a $1.0 million increase in non-cash stock-based compensation expense. Partially offsetting these increases was a $0.4 million decrease in consulting expenses.

General and administrative expenses were $2.2 million for the fourth quarter of 2015 versus $2.6 million for the fourth quarter of 2014. The decrease in general and administrative expenses was due primarily to a $0.2 million decrease in consulting expenses and a $0.2 million decrease in employee related expenses. General and administrative expenses were $9.7 million for 2015 versus $10.1 million for 2014. The decrease in general and administrative expenses was due primarily to a $0.4 million decrease in consulting expenses.

Non-cash stock-based compensation expense included in total operating expenses was $2.0 million for the fourth quarter of 2015 versus $1.6 million for the fourth quarter of 2014. Non-cash stock-based compensation expense included in total operating expenses was $6.8 million for 2015 versus $5.5 million for 2014. The increase in stock-based compensation expense was due to the amortization of a greater number of options with higher fair values.

Net income for the fourth quarter of 2015 was $69.7 million compared to a net loss of $6.0 million for the fourth quarter of 2014. Included in the net income for the fourth quarter of 2015 was an operating income of $52.3 million and non-cash income of $17.4 million compared to an operating loss of $7.6 million and non-cash income of $1.6 million in the fourth quarter of 2014. The net income for 2015 was $43.8 million compared to a net loss of $21.6 million in 2014. Included in the net income for 2015 was an operating income of $26.9 million and non-cash income of $16.8 million compared to an operating loss of $31.3 million and non-cash income of $9.3 million in 2014. The non-cash income or expense is related to changes in the fair value of the Company’s outstanding and exercised warrants that was classified as other income (expense).

About Evofosfamide
Evofosfamide (previously known as TH-302) is an investigational hypoxia-activated prodrug of a bis-alkylating agent that is preferentially activated under severe hypoxic tumor conditions, a feature of many solid tumors. Areas of low oxygen levels (hypoxia) in solid tumors are due to insufficient blood vessel supply. Similarly, the bone marrow of patients with hematological malignancies has also been shown, in some cases, to be severely hypoxic. On December 6, 2015, the Company announced the outcomes of two Phase 3 studies (MAESTRO and TH-CR-406/SARC021) of evofosfamide stating that neither study met its primary endpoint. The related news release can be accessed on the Company’s website.

About Tarloxotinib Bromide
Tarloxotinib bromide (the proposed International Nonproprietary Name, previously known as TH-4000), or "tarloxotinib", is a prodrug designed to selectively release a covalent (irreversible) EGFR tyrosine kinase inhibitor under severe hypoxia, a feature of many solid tumors. Accordingly, tarloxotinib has the potential to effectively shut down aberrant EGFR signaling in a tumor-selective manner, thus potentially avoiding or reducing the systemic side effects associated with currently available EGFR tyrosine kinase inhibitors. Tarloxotinib is currently being evaluated in two Phase 2 proof-of-concept trials: one for the treatment of patients with mutant EGFR-positive, T790M-negative advanced non-small cell lung cancer progressing on an EGFR tyrosine kinase inhibitor, and the other for patients with recurrent or metastatic squamous cell carcinomas of the head and neck or skin. Threshold licensed exclusive worldwide rights to tarloxotinib from the University of Auckland, New Zealand, in September 2014.