On November 8, 2016 Jazz Pharmaceuticals plc (Nasdaq: JAZZ) reported financial results for the third quarter of 2016 and updated financial guidance for 2016 (Press release, Jazz Pharmaceuticals, NOV 8, 2016, View Source;p=RssLanding&cat=news&id=2220711 [SID1234516566]).

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"We have made substantial progress towards achieving our corporate objectives for 2016, delivering solid top-line growth in our commercial business, investing in broadening our hematology/oncology portfolio with the completion of the Celator acquisition and increasing our investments in R&D," said Bruce Cozadd, chairman and chief executive officer of Jazz Pharmaceuticals. "In the third quarter, we began a rolling NDA submission for Vyxeos for the treatment of acute myeloid leukemia, and we are pleased with the achievement of important clinical milestones, advancement of key R&D programs and expansion of our clinical development portfolio, all of which support our goal of developing and commercializing meaningful therapies for patients while building shareholder value."

GAAP net income attributable to Jazz Pharmaceuticals plc for the third quarter of 2016 was $87.1 million, or $1.41 per diluted share, compared to $88.0 million, or $1.39 per diluted share, for the third quarter of 2015.

Adjusted net income attributable to Jazz Pharmaceuticals plc for the third quarter of 2016 was $158.5 million, or $2.57 per diluted share, compared to $159.3 million, or $2.52 per diluted share, for the third quarter of 2015. Reconciliations of applicable GAAP reported to non-GAAP adjusted information are included in this press release.

Financial Highlights

Three Months Ended
September 30,

Nine Months Ended
September 30,

(In thousands, except per share amounts and percentages)
2016

2015

Change

2016

2015

Change
Total revenues
$
374,181

$
340,872

9.8
%

$
1,091,352

$
983,922

10.9
%
GAAP net income attributable to Jazz Pharmaceuticals plc
$
87,145

$
87,960

(0.9)
%

$
272,548

$
246,774

10.4
%
Adjusted net income attributable to Jazz Pharmaceuticals plc1
$
158,470

$
159,302

(0.5)
%

$
453,931

$
418,968

8.3
%
GAAP EPS attributable to Jazz Pharmaceuticals plc
$
1.41

$
1.39

1.4
%

$
4.40

$
3.91

12.5
%
Adjusted EPS attributable to Jazz Pharmaceuticals plc1
$
2.57

$
2.52

2.0
%

$
7.32

$
6.64

10.2
%

1.
Commencing with the second quarter of 2016, the company modified the calculation of its non-GAAP income tax provision in connection with the Securities and Exchange Commission’s May 2016 guidance pertaining to non-GAAP financial measures. This modification is reflected in the company’s 2015 and 2016 non-GAAP interim period results and full-year 2016 financial guidance. See "Non-GAAP Financial Measures" below. The modification did not have a material effect on the adjusted net income attributable to Jazz Pharmaceuticals plc or adjusted EPS for the three months ended September 30, 2015. The modification resulted in the reduction of adjusted net income attributable to Jazz Pharmaceuticals plc by $17.6 million, or $0.28 per diluted share, compared to the amount previously reported for the nine months ended September 30, 2015.

Total Revenues

Three Months Ended
September 30,

Nine Months Ended
September 30,
(In thousands)
2016

2015

2016

2015
Xyrem (sodium oxybate) oral solution
$
285,907

$
242,899

$
816,412

$
703,435

Erwinaze / Erwinase (asparaginase Erwinia chrysanthemi)
42,986

56,317

143,907

152,821

Defitelio (defibrotide sodium) / defibrotide
28,137

19,639

79,280

52,259

Prialt (ziconotide) intrathecal infusion
8,783

6,042

23,065

19,944

Psychiatry
3,875

9,910

14,744

28,375

Other
1,933

3,947

7,239

21,061

Product sales, net
371,621

338,754

1,084,647

977,895

Royalties and contract revenues
2,560

2,118

6,705

6,027

Total revenues
$
374,181

$
340,872

$
1,091,352

$
983,922

Net product sales increased 10% in the third quarter of 2016 compared to the same period in 2015 due to higher net product sales of Xyrem and Defitelio.

Xyrem net product sales increased 18% in the third quarter of 2016 compared to the same period in 2015.

Erwinaze/Erwinase net product sales decreased 24% in the third quarter of 2016 compared to the same period in 2015 due to an Erwinaze supply interruption in the U.S. late in the third quarter of 2016. The company expects that it will continue to experience Erwinaze inventory and supply challenges, which have resulted, and are expected to continue to result, in temporary disruptions in the company’s ability to supply certain markets, including the U.S.

Defitelio/defibrotide net product sales increased $8.5 million in the third quarter of 2016 compared to the same period in 2015 primarily due to net sales of $7.1 million in the U.S.

Operating Expenses

Three Months Ended
September 30,

Nine Months Ended
September 30,
(In thousands, except percentages)
2016

2015

2016

2015
GAAP:

Cost of product sales
$
24,311

$
28,385

$
71,730

$
78,496

Gross margin
93.5
%

91.6
%

93.4
%

92.0
%
Selling, general and administrative
$
124,368

$
104,044

$
375,751

$
323,564

% of total revenues
33.2
%

30.5
%

34.4
%

32.9
%
Research and development
$
47,796

$
50,784

$
118,139

$
105,798

% of total revenues
12.8
%

14.9
%

10.8
%

10.8
%
Acquired in-process research and development
$
15,000

$
—

$
23,750

$
—

Three Months Ended
September 30,

Nine Months Ended
September 30,
(In thousands, except percentages)
2016

2015

2016

2015
Non-GAAP adjusted:

Cost of product sales
$
22,963

$
27,599

$
68,620

$
76,243

Gross margin
93.8
%

91.9
%

93.7
%

92.2
%
Selling, general and administrative
$
94,534

$
84,502

$
296,633

$
268,013

% of total revenues
25.3
%

24.8
%

27.2
%

27.2
%
Research and development
$
43,323

$
22,998

$
106,847

$
70,661

% of total revenues
11.6
%

6.7
%

9.8
%

7.2
%
Operating expenses changed over the prior year period primarily due to the following:

Selling, general and administrative (SG&A) expenses increased in the third quarter of 2016 compared to the same period in 2015 on a GAAP and on a non-GAAP adjusted basis, primarily due to higher headcount and other expenses resulting from the expansion of the company’s business. The increase on a GAAP basis was also driven by transaction and integration costs related to the Celator acquisition.
Research and development (R&D) expenses on a GAAP basis decreased by $3.0 million in the third quarter of 2016 compared to the same period in 2015. R&D expenses on a non-GAAP adjusted basis increased by $20.3 million primarily due to increased expenses for the development of JZP-110; increasing investments in line extensions for the company’s existing products, including oxybate-related R&D programs and the initiation of a clinical study of defibrotide for the prevention of veno-occlusive disease (VOD); and costs related to the rolling new drug application (NDA) submission for VyxeosTM(cytarabine and daunorubicin liposome injection). The decrease in R&D expenses on a GAAP basis was primarily due to a $25.0 million milestone expense in the third quarter of 2015 in connection with the acceptance for filing by the U.S. Food and Drug Administration (FDA) of the NDA for defibrotide, which was partially offset by the project related costs described above.
Acquired in-process research and development expense in the third quarter of 2016 related to upfront and option payments to Pfenex Inc. under an agreement in which the company was granted worldwide rights to develop and commercialize multiple early-stage hematology product candidates.
Cash Flow and Balance Sheet

As of September 30, 2016, cash, cash equivalents and investments were $426.0 million, and the outstanding principal balance of the company’s long-term debt was $2.3 billion. Cash, cash equivalents and investments decreased from December 31, 2015 primarily due to the acquisition of Celator for approximately $1.5 billion, repurchases under the company’s share repurchase program and a $150.0 million milestone payment triggered by FDA approval of Defitelio on March 30, 2016, partially offset by borrowings of $1.0 billion under the company’s revolving credit facility and cash flows from operations of $409.8 million.

During the nine months ended September 30, 2016, the company repurchased 2.1 million ordinary shares for $259.8 million, at an average cost of $125.65 per ordinary share, under a share repurchase program approved in November 2015. This share repurchase program was completed in September 2016. The company’s board of directors has authorized a new share repurchase program under which the company is authorized to repurchase a number of ordinary shares having an aggregate purchase price of up to $300 million. Under the new program, which has no expiration date, the company may repurchase ordinary shares from time to time on the open market. The timing and amount of repurchases will depend on a variety of factors, including the price of the company’s ordinary shares, alternative investment opportunities, restrictions under the company’s credit agreement, corporate and regulatory requirements and market conditions. The new share repurchase program may be modified, suspended or discontinued at any time without prior notice.

Recent Developments

In September 2016, the company completed patient enrollment for its two Phase 3 studies evaluating JZP-110 in excessive sleepiness associated with obstructive sleep apnea.

In September 2016, the company initiated the rolling NDA submission to the FDA for Vyxeos for the treatment of acute myeloid leukemia. Vyxeos has received FDA orphan drug designation for the treatment of AML and was granted breakthrough therapy designation for treatment of adults with therapy-related AML or AML with myelodysplasia-related changes.

During the third quarter of 2016, the company activated clinical sites in the Phase 3 study of defibrotide for the prevention of VOD in high-risk patients following hematopoietic stem cell transplantation.

In November 2016, the company completed enrollment in the Phase 3 study of Xyrem in pediatric narcolepsy patients with cataplexy.

2016 Financial Guidance

Jazz Pharmaceuticals is updating its full year 2016 financial guidance as follows (in millions, except per share amounts and percentages):

Revenues
$1,485-$1,530
Total net product sales
$1,477-$1,522
-Xyrem net sales*
$1,100-$1,125
-Erwinaze/Erwinase net sales
$190-$215
-Defitelio/defibrotide net sales*
$105-$120
GAAP gross margin %
93%
Non-GAAP adjusted gross margin %1,4
93%
GAAP SG&A expenses*
$492-$517
Non-GAAP adjusted SG&A expenses*,2,4
$395-$405
GAAP R&D expenses*
$159-$171
Non-GAAP adjusted R&D expenses*,3,4
$145-$155
GAAP net income per diluted share
$5.66-$6.56
Non-GAAP adjusted net income per diluted share4
$9.90-$10.30

* Updated November 8, 2016.

1.
Excludes $5 million of share-based compensation expense from estimated GAAP gross margin.
2.
Excludes $78-$86 million of share-based compensation expense, $13-$20 million of transaction and integration related costs and $6 million of expenses related to certain legal proceedings and restructuring from estimated GAAP SG&A expenses.
3.
Excludes $14-$16 million of share-based compensation expense from estimated GAAP R&D expenses.
4.
See "Non-GAAP Financial Measures" below. Reconciliations of non-GAAP adjusted guidance measures are included above and in the table titled "Reconciliation of GAAP to Non-GAAP Adjusted 2016 Net Income Guidance" provided on the last page of this press release.

On November 8, 2016 Cellular Biomedicine Group Inc. (NASDAQ: CBMG) ("CBMG" or the "Company"), a clinical-stage biomedicine firm engaged in the development of immunotherapies for cancer and effective stem cell therapies for degenerative diseases, reported financial results and business highlights for the third quarter ended September 30, 2016 (Press release, Cellular Biomedicine Group, NOV 8, 2016, View Source [SID1234516650]).

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"In recent months, we have been diligently preparing for the launch of our upcoming CD19 and CD20 clinical studies and strengthening our CAR-T intellectual property portfolio," commented Tony (Bizuo) Liu, CBMG’s Chief Executive Officer. "We believe that since August 2015, the China Food and Drug Administration has been working towards formalizing a national cell therapy policy that will lay the groundwork for the safe use of immune cell and stem cell therapy treatments in China. Although the PRC government is still in the process of codifying industry regulations for such cell therapies, in anticipation of potential future market opportunities, we have accelerated the launch of multiple Phase I/IIb clinical studies with CAR-T CD19 and CD20 assets to advance our immuno-oncology pipeline. We have a strong balance sheet to finance our current clinical studies and to further expand our translational medicine research and development."

Third Quarter 2016 Financial Performance

1. Cash Position:$44.1 million cash and cash equivalents as compared to $14.9 million as of December 31, 2015.
2. Cash Used in Operating Activities:We used $3.3 million and $12.1 million for the three months and nine months ended September 30, 2016 in operating activities as compared to $2.9 million and $8.6 million for the same periods in 2015.
3. G&A Expenses: General and administrative expenses for the three months and nine months ended September 30, 2016 were $2.8 million and $8.6 million respectively, compared to $3.5 million and $9.9 million for the same periods in 2015.
4. R&D Expenses: Research and development expenses for the three months and nine months ended September 30, 2016 were $2.9 million and $8.3 million respectively, compared to $2.2 million and $5.0 million for the same periods in 2015.
5. Net Loss:Net loss allocable to common stock holders for the three months ended September 30, 2016 was $10.7 million, compared to $5.1 million for the same period in 2015. A $4.6 million impairment charge was incurred in the third quarter due to legacy, non-core business investments.

Business and Operational Highlights for the Third Quarter 2016 to date

The Company signed a tenancy deposit agreement to lease a 10,500 square meters facility located in Shanghai;
Appointment of Dr. Zhou Hansheng as a Director of the Company; and
Completed treatment of eighteen patients in Phase I clinical study of AlloJoinTMhaMPC therapy for Knee Osteoarthritis (KOA).

On November 8, 2016 Aeterna Zentaris Inc. (NASDAQ: AEZS) (TSX: AEZ) (the "Company"), a specialty biopharmaceutical company engaged in developing and commercializing novel treatments in oncology and endocrinology, reported financial and operating results for the third quarter ended September 30, 2016 (Filing, Q3, AEterna Zentaris, 2016, NOV 8, 2016, View Source [SID1234516618]).

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Commenting on recent key developments, David A. Dodd, President and Chief Executive Officer of the Company, stated, "On September 30, 2016, we had unrestricted cash and cash equivalents of approximately $21.1 million. After the end of Q3, we concluded a financing transaction that secured our financial condition on the eve of our completion of two pivotal Phase 3 trials. We raised $7.56 million of gross proceeds from the sale of Common Shares, Pre-funded Warrants and Warrants in a registered direct offering on November 1, 2016. Also between September 14, 2016 and October 14, 2016, we raised approximately $2.3 million of gross proceeds from the sale of 580,912 Common Shares pursuant to our ATM program. Since October 14, 2016, our ATM program has not been utilized. Therefore, we believe we have the funds necessary to complete our two pivotal clinical trials, to report top-line results on both and to file a New Drug Application for Macrilen in the first half of 2017, if the results of the trial warrant doing so. While we will need to raise additional funds before we are able to bring a product to market, we expect that reporting favorable top-line results from one or both of our clinical trials will permit us to do so on favorable terms."

Regarding developments with respect to Zoptrex (zoptarelin doxorubicin), the Company’s lead oncology compound, Mr. Dodd stated, "After quarter-end, we concluded the fourth out-license of Zoptrex, our investigational compound that links a synthetic peptide carrier to doxorubicin as a New Chemical Entity (NCE). Specialised Therapeutics Asia Pty Ltd, a leading specialty pharmaceutical company based in Australia, licensed the product for commercialization in Australia and New Zealand. We received an up-front payment for the rights to Zoptrex and we will receive additional milestone payments and royalties if commercialization of the potential product proceeds. Furthermore, we obtained further validation of the market’s interest in Zoptrex. We expect to release top-line results for our pivotal Phase 3 trial of Zoptrex in Q1 of 2017 and if the results of the trial warrant doing so, to file a new drug application for Zoptrex in 2017."

Mr. Dodd continued his commentary with an update on the development of Macrilen (macimorelin), "We are pleased to announce that we recently completed recruitment in our confirmatory Phase 3 study of Macrilen for the evaluation of adult growth hormone deficiency. As a result, we are very confident that the study of Macrilen will be concluded and that we will report top-line results in early 2017. If our expectations for completion of the confirmatory Phase 3 study are realized and if the top-line results indicate that the product attained the primary endpoint of the Phase 3 study, we expect to file an NDA for Macrilen in the first half of 2017. Since the regulatory review period for the Macrilen confirmatory study is six months, we could begin commercializing the product late in 2017."

Third Quarter 2016 Financial Highlights
R&D costs were $4.5 million and $11.9 million for the three and nine months ended September 30, 2016, respectively, compared to $4.1 million and $13.0 million for the same periods in 2015. The increase in R&D costs for the three months ended September 30, 2016, as compared to the same periods in 2015, is mainly attributable to higher comparative third-party costs. During 2015, we initiated the new confirmatory Phase 3 clinical trial of Macrilen. The first patient recruitment was achieved in the fourth quarter of 2015 and we completed the patient recruitment in the fourth quarter of 2016. The decrease in R&D costs for the nine months ended September 30, 2016, as compared to the same periods in 2015, is mainly attributable to lower comparative third-party costs. Third-party costs attributable to Zoptrex decreased considerably during the nine months ended September 30, 2016, as compared to the same period in 2015, mainly due to the fact that dosing of patients in the ZoptEC trial was completed in February 2016. This is consistent with our expectations as we are approaching the end of the clinical trials. The overall decrease for the nine-month period is also explained by lower employee compensation and benefits costs as well as lower other costs. A substantial portion of this decrease is due to the realization of cost savings in connection with our ongoing efforts 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.

General and administrative ("G&A") expenses were $1.6 million and $5.4 million for the three and nine months ended September 30, 2016, respectively, as compared to $1.9 million and $7.4 million for the same periods in 2015. The decrease in our G&A costs for the three months ended September 30, 2016, as compared to the same period in 2015, is mainly due to the realization of cost savings in connection with our corporate restructuring, which was announced in the fourth quarter of 2015. The comparative decrease for the nine-month period is also partially explained by the realization of costs saving in connection with our corporate restructuring although mainly attributable to the recording, in the prior year period, of certain transaction costs allocated to warrants in connection with the completion of an offering in March 2015.

Selling expenses were $1.8 million and $5.2 million for the three and nine months ended September 30, 2016, respectively, as compared to $1.7 million and $5.1 million for the same periods in 2015. The selling expenses for the three and nine months ended September 30, 2016 and 2015 represent mainly the costs of our contracted sales force related to the co-promotion activities as well as our internal sales management team.

Net loss for the three and nine months ended September 30, 2016 was $6.1 million and $16.7 million, or $0.61 and $1.68 per basic and diluted share, as compared to a net loss of $15.3 million and $40.1 million, or $6.66 and $29.12 per basic and diluted share, for the same periods in 2015. The decrease in net loss for the three months ended September 30, 2016, as compared to the same period in 2015, is due largely to higher comparative net finance income. The decrease in net loss for the nine months ended September 30, 2016, as compared to the same period in 2015, is due largely to lower operating expenses and higher comparative net finance income. The movements in net finance income (costs) primarily relate to the change in fair value of warrant liability.

Cash and cash equivalents were approximately $21.1 million as at September 30, 2016, compared to approximately $26.2 million as at June 30, 2016.

On November 7, 2016 Progenics Pharmaceuticals, Inc. (Nasdaq:PGNX) reported financial results for the third quarter 2016 and business update (Press release, Progenics Pharmaceuticals, NOV 7, 2016, View Source [SID1234516354]).

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"In recent months, we have realized $100 million in non-dilutive funding from RELISTOR, first with the $50M RELISTOR oral approval milestone in July, followed by the $50 million of proceeds from the non-recourse loan secured by future RELISTOR royalties announced today," said Mark Baker, Chief Executive Officer of Progenics. "With our strong balance sheet, we have the resources to advance our programs through key milestones. We expect to report registrational topline data, in early 2017, for our ultra-orphan radiotherapeutic candidate AZEDRA, for the treatment of pheochromocytoma and paraganglioma, rare tumors of the adrenal gland, and are beginning to build our commercial infrastructure to support a potential launch. In addition, we are continuing to advance our innovative portfolio of imaging agents and therapeutic candidates which have the potential to transform how we find, fight and follow prostate cancer."

Key Business Highlights

RELISTOR, treatment for opioid-induced constipation (partnered with Valeant Pharmaceuticals International, Inc.)

Announced Food and Drug Administration (FDA) Approval and Commercial Launch of Oral RELISTOR for the Treatment of Opioid Induced Constipation in Adults with Chronic Non-Cancer Pain. The approval triggered a $50 million milestone payment on July 25 from Progenics’ commercialization partner, Valeant, as well as subsequent royalties and the potential of up to $200 million in sales milestones.

RELISTOR (SC and Oral) Net Sales for the Third of 2016 Totaled $22.1 million. The third quarter 2016 sales, as reported to Progenics by Valeant, translated to $3.3 million in royalty revenue for the quarter.
AZEDRA, Ultra-orphan radiotherapeutic candidate

AZEDRA Topline Results Expected First Quarter 2017. In early 2017, Progenics expects to report topline results from its ongoing registrational trial of AZEDRA. If the AZEDRA trial meets the endpoints of the Special Protocol Assessment (SPA), Progenics expects to submit a New Drug Application (NDA) to the FDA during the first half of 2017.
PSMA-Targeted Prostate Cancer Pipeline

Enrollment in Pivotal Phase 3 Study of 1404 is Ongoing. The study will enroll up to 450 patients with newly-diagnosed or low-grade prostate cancer who are candidates for active surveillance. Progenics plans for an interim analysis by the end of this year, to assess futility and evaluate the need for a sample size re-estimation, remain unchanged.

On Track to Initiate Phase 2/3 Trial of PyL Imaging Agent. Progenics remains on-track to initiate a Phase 2/3 trial of PyL by year-end. The study is designed to assess the diagnostic accuracy of PyL PET/CT imaging in patients with high risk and/or metastatic prostate cancer.

PyL Research Access ProgramTM. At the recent Prostate Cancer Foundation Scientific Retreat, Progenics announced a new PyL research access program that will make limited doses of PyL available to researchers beginning January 1, 2017. Progenics will be able to use the data generated from the access program to support its registration efforts for PyL and advance the development of algorithms designed to analyze and interpret the scans.

Company Remains On-Track to Initiate a Phase 1 Trial of 1095 in the Fourth Quarter of 2016. The Phase 1 Study of 1095, a PSMA-Targeted Therapeutic for Metastatic Prostate Cancer, will be conducted at Memorial Sloan Kettering Cancer Center.
Corporate

Announced $50 Million RELISTOR Royalty-Backed Non-Dilutive Debt Financing with HealthCare Royalty Partners. In a separate press release issued today, Progenics announced that it has entered into a $50 million non-recourse, term loan agreement secured by and to be repaid from royalties on future sales of RELISTOR. Any future sales milestones received under Valeant agreement are excluded from the transaction and would not be used to repay interest or principal on the loan. Progenics and HealthCare Royalty Partners may mutually elect to include a second tranche of an additional $50 million within twelve months of the closing date.

Appointed Biopharmaceutical Industry Veteran Bryce V. Tenbarge as Vice President of Commercial. Mr. Tenbarge brings to Progenics over fifteen years of experience in biopharmaceutical marketing, most recently as Vice President of Marketing and Commercialization at Celldex Therapeutics.
Third Quarter 2016 Financial Results

Third quarter revenue totaled $53.9 million, up from $1.4 million in the third quarter of 2015, reflecting RELISTOR royalty income of $3.3 million compared to $1.2 million in the corresponding period of 2015. Valeant’s reported net sales include a non-recurring favorable sales return adjustment and launch of oral RELISTOR. The increase in revenue was primarily attributable to milestone revenue of $50 million for the July 19 approval of RELISTOR Tablets.

Third quarter and year-to-date research and development expenses increased by $2.8 million and $6.7 million, respectively, compared to the corresponding prior year periods, resulting from higher clinical trial and contract manufacturing expenses for 1404, AZEDRA, PyL and 1095. Third quarter general and administrative expenses increased by $2.6 million compared to the corresponding prior year period, primarily attributable to an accrual for front pay compensation related to litigation with a former employee, and higher consulting and market research expenses. Year-to-date general and administrative expenses increased by $4.2 million compared to the corresponding period in 2015, primarily due to higher depreciation expense as a result of a reduction in the remaining useful lives of our leasehold improvements at our Tarrytown, NY location, and higher compensation, consulting and market research expenses. Progenics also recorded a non-cash charge of $0.6 million in the third quarter related to an increase in the fair value estimate of the contingent consideration liability.

Net income attributable to Progenics for the quarter was $36.3 million or $0.52 per diluted share, compared to a net loss of $10.0 million or $0.14 per diluted share in the corresponding 2015 period. Progenics ended the quarter with cash and cash equivalents of $98.9 million, an increase of $24.8 million compared to cash and cash equivalents as of December 31, 2015.

On November 7, 2016 Halozyme Therapeutics, Inc. (NASDAQ: HALO) reported financial results and recent highlights for the third quarter ended September 30 (Press release, Halozyme, NOV 7, 2016, View Source [SID1234516388]).

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"The third quarter was highlighted by Genentech’s BLA filing for rituximab in a subcutaneous formulation using Halozyme’s ENHANZE platform in multiple blood cancers, a development that adds to the potential for our royalty revenue and highlights the benefits of our business model," said Dr. Helen Torley, president and chief executive officer. "In our oncology pillar, we continued initiation of our global sites in our phase 3 study of PEGPH20 and are making progress toward dose expansion in our study with Keytruda, all as we anticipate reporting topline results from stage 2 of our HALO-202 study once the data is mature."

Halozyme was recently informed by the independent statistician for the data monitoring committee of its HALO-202 study that progression-free survival data are not yet mature for analysis. As a result, the company now expects the reporting of data may move into 2017, depending on when it is mature for analysis.

Third Quarter 2016 and Recent Highlights include:

The inclusion of PEGPH20 in the Pancreatic Cancer Action Network’s Precision Promise initiative, a broad industry and pancreatic cancer community coalition established to study pancreatic cancer therapies in patients based on the molecular profile of their tumors. The clinical trial plans to enroll patients at 12 consortium sites in the U.S. beginning in spring 2017.
Continuing to initiate sites in the HALO-301 | Pancreatic study toward the goal of having approximately 90 percent of centers ready to screen patients by the end of 2016.
Progressing in dose escalation of the ongoing phase 1b clinical study evaluating PEGPH20 in combination with KEYTRUDA (pembrolizumab) in relapsed non-small cell lung and gastric cancer patients. The company continues to project that the study will move to the dose expansion phase by the end of 2016.
U.S. Food and Drug Administration (FDA) filing a Biologics License Application (BLA) to support approval for the subcutaneous formulation of Rituximab in multiple blood cancer indications. Including all approved indications, Roche reported total 2015 sales of rituximab in the United States of 3.76 billion CHF.
Pfizer announcing discontinuation of the global clinical development program for bococizumab, its investigational PCSK9 inhibitor. The development of a subcutaneous version on the Halozyme ENHANZE platform has also been discontinued. Pfizer also made a portfolio decision to discontinue development of rivipansel with the ENHANZE platform even though the technology performed as intended. Pfizer continues to develop an additional program with the ENHANZE platform for an undisclosed target.
Third Quarter 2016 Financial Highlights

Revenue for the third quarter was $31.9 million compared to $20.8 million for the third quarter of 2015, driven primarily by royalties from partner sales of Herceptin SC, MabThera SC and HYQVIA, API sales to partners, and manufacturing and clinical supply reimbursements from ENHANZE partners.
Revenue for the third quarter included $13 million in royalties, an increase of 58 percent from the prior-year period, $9.6 million in sales of bulk rHuPH20 primarily for use in manufacturing collaboration products and $3.7 million in HYLENEX recombinant (hyaluronidase human injection) product sales.
Research and development expenses for the third quarter were $33.9 million, compared to $27.6 million for the third quarter of 2015. The planned increases were primarily due to a ramp in spending associated with the HALO-301 study, personnel expenses, and manufacturing and clinical supply expenses that are reimbursed by ENHANZE partners.
Selling, general and administrative expenses for the third quarter were $11.6 million, compared to $10.2 million for the third quarter of 2015. The increase was primarily due to personnel expenses, including stock compensation, for the period.
Net loss for the third quarter was $28.9 million, or $0.23 per share, compared to a net loss in the third quarter of 2015 of $24.5 million, or $0.19 per share.
Cash, cash equivalents and marketable securities were $221.1 million at September 30 compared to $230 million at June 30, 2016.
Financial Outlook for 2016

For the full year 2016, the company updated and narrowed its financial guidance, now expecting:

Net revenue of $145 million to $150 million, raising the lower end of its prior $140 million to $150 million range;
Operating expenses of $240 million to $245 million, from the prior $245 million to $260 million range;
Cash flow of $75 million to $85 million, from the prior range of $65 million to $85 million;
Year-end cash balance of $180 million to $190 million, raising the lower end of its prior $170 million to $190 million range.
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