XOMA Reports Fourth Quarter and Full-Year 2015 Financial Results

On March 09, 2016 XOMA Corporation (Nasdaq:XOMA), a leader in the discovery and development of therapeutic antibodies, today reported the completion of its divestiture activities to focus the Company exclusively on advancing its portfolio of assets to address endocrine diseases, and provided its financial results for the quarter and year ended December 31, 2015 (Press release, Xoma, MAR 9, 2016, View Source [SID:1234509460]).

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Recent Corporate Developments:

Initiated a Phase 2 proof-of-concept study of XOMA 358 in patients with congenital hyperinsulinism, a rare genetic disorder in which the insulin cells of the pancreas secrete inappropriate and excessive insulin

Licensed its first-in-class TGF-beta immuno-oncology antibody program to Novartis for an upfront payment of $37 million, potential milestone payments of up to $480 million and tiered royalties up to low double digits

Extended the maturity date of its $13.5 million note due to Novartis until September 2020

Licensed XMetA, its selective insulin receptor modulator antibody program for diabetes, to Novo Nordisk A/S for an upfront payment of $5 million, potential milestone payments of up to $290 million and tiered royalties

Sold biologics manufacturing facility to Agenus Inc.

Divested anti-botulinum toxin program to Nanotherapeutics, Inc.

Closed the remaining gevokizumab clinical programs; initiating licensing efforts

Reduced headcount by half to approximately 90

Achieved cash runway to finance endocrine franchise into 2017

"The transformation we initiated in the third quarter of last year — and now have completed in less than six months — was considerable in its scale and complexity, but essential to position XOMA to deliver our promising portfolio of endocrine assets," stated John Varian, Chief Executive Officer of XOMA. "Novel antibodies and technologies created by XOMA scientists to target diseases such as cancer, diabetes and botulism will be advanced in the capable hands of Novartis, Novo Nordisk, Nanotherapeutics and Agenus, with XOMA sharing in potential successes in certain cases."

Mr. Varian continued, "We are now fully focused on efficiently maximizing the potential of XOMA 358, XOMA 129, and XOMA 213, all of which may address unmet medical needs in endocrinology. Our XOMA 358 proof-of-concept study in patients with hypoglycemia due to congenital hyperinsulinism is progressing on schedule. Several patients have been enrolled in the U.S., and our UK study center expects to begin enrolling patients in the coming weeks. Our XOMA 358 proof-of-concept study in patients with hyperinsulinism post bariatric surgery is expected to start dosing patients early in the second quarter. Additionally, we have finalized the design of a proof-of-concept study for XOMA 213, which may offer a new therapeutic option for patients with hyperprolactinemia, and anticipate initiating the study midyear. In 2016, we expect to have Phase 2 data from both XOMA 358 indications, and they will set the stage for XOMA in 2017 and beyond."

Gevokizumab Update

Given XOMA’s focus on endocrinology, the Company has decided to stop all gevokizumab related development activities and is initiating a formal sales process for the asset. As a result, the Company is closing the Phase 3 program in patients suffering from pyoderma gangrenosum. A preliminary review of the data from the approximate 25 patients enrolled in the trial to date did not show a clear signal of activity in this indication. XOMA has been approached by several companies interested in gevokizumab and data from all gevokizumab studies will be available to potential buyers.

Financial Results

XOMA recorded total revenues of $55.4 million for the twelve months ended December 31, 2015, compared with $18.9 million during the same period of 2014. For the three months ended December 31, 2015, XOMA recorded revenues of $48.2 million compared with $4.3 million in the corresponding period of 2014. The increase in the full-year and fourth quarter 2015 revenues was due primarily to our licensing activity in the fourth quarter, including a $37.0 million upfront payment from Novartis, a $5.0 million upfront payment from Novo Nordisk and a $3.8 million payment from Pfizer, which were partially offset by lower revenues from our contracts with the National Institutes of Allergy and Infectious Disease (NIAID) and reimbursements from Servier under our collaboration agreement.

Annual research and development (R&D) expenses for 2015 were $70.9 million compared to $80.7 million incurred in 2014. The decrease in 2015 reflects a $3.1 million reduction in salaries and related expenses, a $3.5 million reduction in internal and external manufacturing costs, and a decrease in our clinical trial costs associated with gevokizumab. For the three-month periods ended December 31, 2015 and 2014, R&D expenses were $13.6 million and $19.4 million, respectively. The decrease in the 2015 fourth quarter R&D expenses was due primarily to reduced headcount and clinical trial costs.

In 2015, selling, general and administrative (SG&A) expenses were $20.6 million compared to $19.9 million incurred during 2014, primarily reflecting increased consulting services related to our out-licensing activities and increased legal fees, which were partially offset by a reduction in salaries and related personnel costs. SG&A expenses were $4.7 million in the fourth quarter of 2015, as compared to $4.1 million in the corresponding quarter of 2014. The increase in SG&A expenses primarily reflects an increase in legal fees partially offset by a decrease in salaries and related expenses.

In August 2015, the Company announced its intention to close the gevokizumab Phase 3 EYEGUARD global clinical program. In connection with the Company’s efforts to lower operating expenses and focus on its endocrine product pipeline, management implemented a restructuring plan during second half of 2015 that included the elimination of a number of positions throughout all areas of the Company. During the year ended December 31, 2015, XOMA recorded charges of $2.9 million related to severance, other termination benefits and outplacement services and recognized an additional restructuring charge of $0.8 million in contract termination costs, which primarily included costs in connection with the discontinuation of the EYEGUARD studies.

For the year ended December 31, 2015, XOMA had a net loss of $20.6 million compared with a net loss of $38.3 million in the year ended December 31, 2014. The full-year net losses in 2015 and 2014 included a $17.8 million gain and $45.8 million gain, respectively, in non-cash revaluation of contingent warrant liabilities, which resulted primarily from fluctuations in XOMA’s stock price. Excluding those revaluations, the net loss for 2015 was $38.4 million, and the net loss for 2014 was $84.1 million. For the three months ended December 31, 2015, XOMA reported a net income of $25.4 million, which included a charge of $6.4 million directly related to the revaluation of contingent warrant liabilities. Excluding the non-cash expense associated with the revaluation of contingent warrant liabilities, the net income for the 2015 fourth quarter was $31.7 million. Excluding a $12.1 million gain in non-cash revaluation of contingent warrant liabilities, the net loss for the 2014 fourth quarter was $19.4 million.

On December 31, 2015, XOMA had cash and equivalents of $65.8 million. The Company ended December 31, 2014, with cash and cash equivalents of $78.4 million.

The Company expects to have cash through the first quarter of 2017.

Rigel Announces Fourth Quarter and Year End 2015 Financial Results

On March 8, 2016 Rigel Pharmaceuticals, Inc. (Nasdaq:RIGL) reported financial results for the fourth quarter and year ended December 31, 2015(Press release, Rigel, MAR 8, 2016, View Source;p=RssLanding&cat=news&id=2146948 [SID:1234509426]).

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"Fostamatinib is our top priority for 2016 with the first results of our Phase 3 studies in immune thrombocytopenic purpura anticipated in the middle of the year," said Raul Rodriguez, president and chief executive officer of Rigel. "Also this year, we expect the readouts of the two other fostamatinib clinical programs, the Phase 2 in IgA nephropathy and the recently announced Phase 2 proof-of-concept study in autoimmune hemolytic anemia," he added.

For the fourth quarter of 2015, Rigel reported a net loss of $12.7 million, or $0.14 per share, compared to a net loss of $22.3 million, or $0.25 per share, in the fourth quarter of 2014. Weighted average shares outstanding for the fourth quarters of 2015 and 2014 were 89.0 million and 87.8 million, respectively.

Contract revenues from collaborations of $8.5 million in the fourth quarter of 2015 were primarily comprised of the amortization of the $30.0 million upfront payment from Bristol-Myers Squibb (BMS), as well as a license fee from a third party pursuant to a license agreement executed in October 2015. Contract revenues from collaborations of $8.3 million in the fourth quarter of 2014 were comprised of non-refundable payments from AstraZeneca AB (AZ) as a result of its continued development of R256 in asthma.

Rigel reported total costs and expenses of $21.3 million in the fourth quarter of 2015, compared to $30.6 million in the fourth quarter of 2014. Costs and expenses in the fourth quarter of 2014 included a loss on executing a sublease, as well as stock-based compensation expense and severance costs related to the retirement of Rigel’s former chief executive officer.

For the year ended December 31, 2015, Rigel reported contract revenues from collaborations of $28.9 million and a net loss of $51.5 million, or $0.58 per basic and diluted share, compared to contract revenues from collaborations of $8.3 million and a net loss of $90.9 million, or $1.04 per basic and diluted share, in 2014. Contract revenues from collaborations in 2015 were mainly comprised of $16.6 million from the amortization of the $30.0 million upfront payment from BMS and upfront payments received from other collaborators. Contract revenues from collaborations in 2014 were comprised of non-refundable payments from AZ as a result of its continued development of R256 in asthma.

As of December 31, 2015, Rigel had cash, cash equivalents and short-term investments of $126.3 million, compared to $143.2 million as of December 31, 2014. Rigel expects this amount to be sufficient to fund operations into the third quarter of 2017.

XBiotech Announces Submission of Marketing Authorization Application (MAA) for Candidate Colorectal Cancer Therapy to European Medicines Agency (EMA)

On March 08, 2016 XBiotech Inc. (NASDAQ:XBIT) reported that the Company has now submitted its Marketing Authorization Application (MAA) for its candidate therapy (Xilonix) for advanced colorectal cancer to the European Medicines Agency (EMA) (Press release, XBiotech, MAR 8, 2016, View Source [SID1234556367]). Submission of the MAA for Xilonix is necessary for the Company to gain approval to sell the drug in European Union member nations. The Company, which only recently was granted eligibility to submit its MAA through the Centralised Procedure, has made a remarkably quick turnaround for delivery of the extensive MAA documentation needed for the EMA review.

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John Simard, CEO of XBiotech, commented, "With submission of the Marketing Authorization Application, we now look forward to the review process."

Few agents are reliably able to mediate durable responses in metastatic disease. And many agents have significant trade-offs in terms of side effects. In patients with advanced disease, often weakened from successive rounds of cytotoxic therapy, the risk-benefit associated with further therapy is often questionable. Based on novel objective response (OR) criteria, developed by XBiotech in conjunction with the EMA’s Scientific Advice Working Group, the candidate therapy subject of the MAA was recently evaluated in a Phase III clinical study for the ability to control disease-related symptoms that inversely correlate with survival. The Company believes using the symptom-based objective response criteria will allow better assessment of overall benefit from therapy in advanced cancer patients.

Genmab Provides Update on Ofatumumab Development in Autoimmune Indications

On March 8, 2016 Genmab A/S (Nasdaq Copenhagen: GEN) reported an update on development plans for ofatumumab in autoimmune indications focusing on relapsing multiple sclerosis following the transfer of the rights to ofatumumab in this disease area from GlaxoSmithKline (GSK) to Novartis at the end of 2015 (Press release, Genmab, MAR 8, 2016, View Source [SID:1234509401]). Phase III studies are expected to be initiated by Novartis with the subcutaneous formulation of ofatumumab as therapy for patients with relapsing multiple sclerosis during the second half of 2016.

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The Phase III study of the subcutaneous formulation of ofatumumab in pemphigus vulgaris, which was started by GSK will be discontinued to focus on relapsing multiple sclerosis. The decision to discontinue the trial was not related to any safety or tolerability concerns. There are no current plans to develop ofatumumab in neuromyelitis optica.

"We are very pleased with Novartis’ commitment to move the development of ofatumumab forward in multiple sclerosis and look forward to the initiation of the Phase III studies in the second half of this year," said Jan van de Winkel, Ph.D., Chief Executive Officer of Genmab.

About Ofatumumab (Arzerra)
Ofatumumab is a human monoclonal antibody that is designed to target the CD20 molecule found on the surface of chronic lymphocytic leukemia (CLL) cells and normal B lymphocytes.

In the United States, Arzerra is approved for use in combination with chlorambucil for the treatment of previously untreated patients with CLL for whom fludarabine-based therapy is considered inappropriate. Arzerra is also approved in the U.S. as extended treatment of patients who are in complete or partial response after at least two lines of therapy for recurrent or progressive CLL. In the European Union, Arzerra is approved for use in combination with chlorambucil or bendamustine for the treatment of patients with CLL who have not received prior therapy and who are not eligible for fludarabine-based therapy. In more than 50 countries worldwide, Arzerra is also indicated as monotherapy for the treatment of patients with CLL who are refractory after prior treatment with fludarabine and alemtuzumab.

Please see full Prescribing Information, including Boxed WARNING for Arzerra (ofatumumab).

The subcutaneous formulation of ofatumumab is also being investigated by Novartis in multiple sclerosis. The use of ofatumumab in multiple sclerosis is investigational and is not currently approved in any market.

Arzerra is marketed under a collaboration agreement between Genmab and Novartis.

Dynavax Reports Fourth Quarter and Year End 2015 Financial Results

On March 8, 2016 Dynavax Technologies Corporation (NASDAQ: DVAX) reported financial results for the fourth quarter and year ended December 31, 2015 (Press release, Dynavax Technologies, MAR 8, 2016, View Source [SID:1234509405]).

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The Company had $196.1 million in cash, cash equivalents and marketable securities as of December 31, 2015.

Total revenues for the year ended December 31, 2015, decreased by $7.0 million or 63 percent compared to the same period in 2014, primarily due to a $5.2 million decrease in collaboration revenue due to winding down of work performed for the AZD1419 program and expiration of our collaboration agreement with GSK in 2014.

Operating expenses increased by $6.8 million or seven percent during 2015 compared to 2014, primarily due to costs related to HBV-23, the Phase 3 clinical study of HEPLISAV-B completed in October 2015, preparation for the commercial launch of HEPLISAV-B in the United States and clinical trial expense for SD-101, Dynavax’s cancer immunotherapeutic product candidate.

The net loss allocable to common stockholders for the year ended December 31, 2015 was $106.8 million, or $3.25 per share, compared to $90.7 million, or $3.45 per share for the year ended December 31, 2014.

"During 2015, we completed HBV-23 and significantly strengthened the Company’s cash position. Earlier this year we reported that this third pivotal study had met both co-primary endpoints. We plan to resubmit the HEPLISAV-B BLA (Biologics License Application) to the FDA by the end of this month. Based on our expectation of a six-month review, if our application is approved we expect to launch this product in the fourth quarter of this year," said Eddie Gray, chief executive officer of Dynavax.