On May 10, 2016 BioTime, Inc. (NYSE MKT and TASE: BTX), a clinical-stage regenerative medicine company with a focus on pluripotent stem cell technology, reported financial results for the first quarter ended March 31, 2016 and provided a corporate update (Press release, BioTime, MAY 10, 2016, View Source;p=RssLanding&cat=news&id=2167228 [SID:1234512255]). The Company also announced that management will host a conference call with investors to discuss the recent operating progress and corporate developments on Tuesday, May 17, 2016 at 4:30 p.m. Eastern / 1:30 p.m. Pacific. Details on how to access the call are provided later in this news release.

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"We are off to a strong start in 2016 as we continue to make progress with BioTime’s key clinical therapeutic programs, Renevia in medical aesthetics and OpRegen in dry AMD," said Adi Mohanty, Co-Chief Executive Officer. "We are also pleased with the significant operating progress achieved by our non-core assets as these companies mature towards standalone businesses. In particular, we are excited to see our digital health subsidiary, LifeMap Solutions, gaining more traction with clients and partners, including best-in-class institutions. Meanwhile, we in the BioTime organization continue to sharpen our focus on clinical progress and simplifying our corporate structure and seeking ways to unlock the value of our more mature revenue-generating subsidiaries for BioTime shareholders."

First Quarter and Recent Highlights

Clinical Progress

OpRegen (retinal pigment epithelial cells)

The first cohort was successfully dosed earlier this year in a Phase I/IIa clinical trial evaluating the safety and efficacy of OpRegen for the treatment of the advanced form of dry age-related macular degeneration (AMD). The trial is evaluating three different dose regimens. BioTime expects the Data Safety Monitoring Board (DSMB), an independent group of experts established for the Phase I/IIa trial, will complete its review of the initial safety data from the first cohort and recommend dose escalation to the second cohort during the second quarter of 2016. The second cohort will receive a higher, more clinically significant, dose of OpRegen. The Company expects to complete enrollment in the second cohort in 2016 and, if the data are positive, anticipates DSMB approval to proceed to the third cohort by the end of 2016. OpRegen has received Fast Track designation from the U.S. Food and Drug Administration for the treatment of dry AMD, which occurs in approximately 90% of those afflicted with AMD.
Renevia (adipose cells + cell delivery matrix)

The Company expects to complete enrollment for its Renevia pivotal clinical trial in Europe in the second half of 2016 with top line data availability in early 2017. If the data are positive, BioTime plans to submit an application for CE Mark approval in the first half of 2017. The objective of the trial is to assess the efficacy of Renevia, which consists of BioTime’s HyStem hydrogel cell-transplantation delivery matrix combined with the patient’s own adipose cells, in restoring normal skin contours in patients whose subcutaneous fat, or adipose tissue, has been lost due to antiviral drug treatment for HIV. Positive data from the pivotal trial is expected to provide the foundation for studying Renevia in the much broader applications of fat tissue deficits in various medical aesthetics applications, such as for age-related and trauma related facial fat loss.
AST-VAC1 (antigen-presenting autologous dendritic cells)

In February, BioTime’s subsidiary Asterias Biotherapeutics, Inc. completed the End-of-Phase 2 meeting with the U.S. Food and Drug Administration (FDA) for AST-VAC1, the company’s lead clinical program targeting maintenance of relapse-free-survival in acute myeloid leukemia (AML) patients. Asterias is planning for the initiation of a single pivotal Phase 3 trial that could support an accelerated development pathway towards a potential future biologic license application (BLA) filing.
Asterias presented data from the Phase II clinical trial of its cancer immunotherapy AST-VAC1 in acute myeloid leukemia (AML) at the American Society of Gene and Cell Therapy (ASGCT) (Free ASGCT Whitepaper) 19th Annual Meeting on May 5, 2016.
AST-OPC1 (oligodendrocyte progenitor cells)

Asterias Biotherapeutics presented an overview of the AST-OPC1 therapeutic development program that is currently in a Phase I/IIa dose escalation clinical trial in spinal cord injury at the Stem Cell Summit 2016 meeting on April 27, 2016.
Cancer Diagnostics

OncoCyte Corporation, the cancer diagnostics subsidiary of BioTime and developer of novel, non-invasive blood and urine based tests for the early detection of cancer, announced that its bladder cancer abstract has been selected for presentation in a poster session, including a live panel discussion on the results, at the 2016 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting in Chicago, Illinois to be held on June 3-7, 2016. The study to be presented at the upcoming ASCO (Free ASCO Whitepaper) annual meeting is based on the continued development of the diagnostic first reported at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) 2015 Annual Meeting. At AACR (Free AACR Whitepaper), OncoCyte presented interim clinical study data for the non-invasive detection of bladder cancer that demonstrated a high level of sensitivity and specificity in the detection of urothelial carcinoma, the most common type of bladder cancer.
On April 4, 2016, OncoCyte and the Wistar Institute, an international biomedical research leader in cancer, immunology and infectious diseases, announced positive research results for a lung cancer diagnostic test being developed at Wistar. This study of 620 subjects replicates a previous study that was carried out at Wistar, which was presented at the American Thoracic Society conference in May 2015. The results of this study are being further evaluated by OncoCyte and mark a successful transition of the assay platform from Illumina microarrays to a Nanostring nCounter machine, which is the platform that OncoCyte intends to use for commercialization. OncoCyte has exclusive commercial rights to the lung cancer diagnostic test developed by Wistar. OncoCyte must now independently validate these results in its own follow-up study based on the results of Wistar’s latest study. OncoCyte will attempt to finalize and lock down both the assay and the classifier or algorithm that interprets test results, and if successful, will initiate an internal analytical validation study.
Non-core Assets

LifeMap Solutions, the digital health subsidiary of BioTime and co-developer of ResearchKit-enabled app Asthma Health, launched its new mobile health app design and development service to help research institutions and health companies worldwide develop custom smartphone apps and research studies. Through the new service, LifeMap offers clients its deep expertise in medical science, consumer behavior, app analytics, and design. LifeMap’s innovative, data-driven mobile health (mHealth) apps are designed to recruit clinical study participants, obtain patient consent through the iPhone, and passively collect participants’ health information. LifeMap Solutions has developed innovative digital health apps in collaboration with leading research institutions including the Icahn School of Medicine at Mount Sinai, Stanford University School of Medicine, and National Jewish Health, as well as with strategic partners like 23andMe.
Corporate Developments

On May 10, 2016, Asterias finalized the pricing of an underwritten public offering of 5,147,059 units at a public offering price of $3.40 per unit. Each unit consists of one share of common stock and 0.5 of a warrant to purchase a share of common stock at an exercise price of $4.37 per share. The warrants are immediately exercisable and expire on the fifth anniversary of the date of issuance. The offering is expected to close on May 13, 2016, subject to customary closing conditions. If completed, Asterias would receive net proceeds of $16,275,000 after underwriting discounts but before paying other costs of the offering. Asterias has granted the underwriters a 30-day option to purchase up to an additional 772,059 shares of common stock and/or additional warrants to purchase up to 386,029 shares of common stock to cover over-allotments, if any. If the over-allotment option is exercised in full, net proceeds of the offering after underwriting discounts but before other expenses are expected to be approximately $18.7 million.
On April 28, 2016, Howard I. Scher, M.D., one of the world’s leading oncology experts, was appointed to the Board of Directors of Asterias Biotherapeutics.
In February, pharmaceutical industry veteran Stephen L. Cartt was appointed as President and Chief Executive Officer of Asterias, and member of the company’s Board of Directors. Mr. Cartt previously served as Chief Operating Officer of Questcor Pharmaceuticals Inc. until its sale in 2014 to Mallinckrodt, plc for $5.6 billion. In addition, Don M. Bailey was appointed to Asterias’ Board of Directors and named Chairman of the Board of Directors. Mr. Bailey previously served as President and Chief Executive Officer of Questcor until its sale in 2014 to Mallinckrodt.
First Quarter Financial Results

Cash (and available-for-sale securities) Position: Cash and cash equivalents totaled $27.1 million as of March 31, 2016, compared to $42.2 million as of December 31, 2015. The cash on hand as of March 31, 2016 includes $16.4 million held by subsidiaries. As of March 31, 2016, BioTime held $829,000 in available-for-sale securities. As of March 31, 2016, BioTime owned 21.7 million shares of Asterias common stock and 14.7 million shares of OncoCyte common stock, which represented an aggregate market value of $170 million as of that date.

Revenues: BioTime’s operating revenues are currently generated from research grants, licensing fees and advertising from the marketing of online database products. Total consolidated revenues were $2.1 million for the first quarter, compared to $1.3 million in the first quarter of 2015. The increase was primarily due to increases in grant revenue and subscription and advertising revenues.

R&D Expenses: Research and development expenses were $13.7 million for the first quarter, compared to $9.3 million for the comparable period in 2015. The increase is in part a result of increased expenses primarily related to regulatory and clinical trials of Asterias’ AST-OPC1 program, and OncoCyte’s cancer diagnostics.

G&A Expenses: General and administrative expenses were $11.9 million for the first quarter, compared to $5.2 million for the first quarter of 2015. The increase is in part a result of $3.1 million in non-cash expense for the estimated fair value of the distribution of 3,331,229 warrants to purchase Asterias common stock to Asterias shareholders other than BioTime declared by the Asterias board of directors on March 30, 2016, increased staffing needed to advance programs under development at BioTime, including non-cash stock-based compensation from BioTime, Asterias, and OncoCyte.

Net Loss attributable to BioTime: Net loss attributable to BioTime was $17.1 million for the three months ended March 31, 2016, or $0.19 per share. There was no deferred income tax benefit recorded in the three months ended March 31, 2016. For the first quarter of 2015, net loss attributable to BioTime was $10.2 million, or $0.13 per share including deferred income tax benefits of $1.2 million. Net loss attributable to BioTime includes losses from BioTime’s majority owned and consolidated subsidiaries based upon BioTime’s percentage ownership of those subsidiaries.

On May 10, 2016 Evotec AG (Frankfurt Stock Exchange: EVT, TecDAX, ISIN: DE0005664809) reported financial results and corporate updates for the first quarter of 2016 (Press release, Evotec, MAY 10, 2016, View Source [SID:1234512324]).

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FINANCIAL PERFORMANCE: BEST Q1 FINANCIAL RESULTS IN COMPANY’S HISTORY

– Significant Group revenue growth of 74% to EUR 37.5 m (2015: EUR 21.5 m); base revenues up 83% to EUR 33.9 m

– Revenue growth in both operating segments: EVT Execute revenues up 67% to EUR 38.6 m, EVT Innovate revenues up 67% to EUR 6.4 m

– Adjusted Group EBITDA significantly increased to EUR 7.2 m (2015: EUR (0.3) m)

– Adjusted EBITDA of EUR 9.6 m for EVT Execute (2015: EUR 3.5 m)

– Increase in R&D expenses of 14% to EUR 4.4 m primarily focused on oncology projects and CNS

– Strong strategic liquidity position of EUR 122.5 m

EVT Execute – ACCELERATED GROWTH IN BASE BUSINESS

– Important milestone achievement in Padlock collaboration

– Multi-year compound management agreement closed with Pierre Fabre (after period-end)

– Milestone achievement in Bayer collaboration (after period-end)

EVT Innovate – FIRST-IN-CLASS CURE X/TARGET X STRATEGY

– Good progress in Cure X/Target X programmes

– Grant from The Michael J. Fox Foundation for Parkinson’s Research

– Good progress in existing partnerships (e.g. EVT201, EVT801 and other Sanofi oncology projects, kidney disease collaboration with AstraZeneca)

– Partnership on immuno-oncology therapeutics with ex scienta

– Phase out of EVT100 in TRD by Janssen Pharmaceuticals

EVT EQUITY – COMPANY FORMATION TO ACCELERATE DRUG DISCOVERY AND PRODUCT DEVELOPMENT

– Formation of a spin-off company (Topas Therapeutics GmbH) in the field of nanoparticle-based therapeutics to treat immunological disorders; completed Series A funding of EUR 14 m

MANAGEMENT BOARD UPDATES AND STRENGTHENING OF GLOBAL HUMAN RESOURCES CAPACITIES

– CEO, COO and CSO contracts extended

– Contract of Colin Bond, CFO, will end 30 June 2016

– Appointment of Enno Spillner as new CFO effective 18 July 2016

– Appointment of Monika Conradt as Global Head of Human Resources effective 01 June 2016

GUIDANCE 2016 CONFIRMED

1. Financial performance

BEST Q1 FINANCIAL RESULTS IN COMPANY’S HISTORY

The 2015 and 2016 results are not fully comparable. The difference stems from the acquisition of Evotec (France) SAS, effective 01 April 2015. While the results of Evotec (France) SAS are fully included in the accompanying consolidated income statement for the first three months of 2016, they were not included in the comparable period of the previous year.

The presented financial statements include a change in presentation in the first three months of 2015 and 2016. From 01 January 2016 onwards, amortisation of intangible assets are no longer presented in a separate line in the consolidated income statement but are allocated to the relating cost lines in the income statement. The prior-year period was changed accordingly resulting in higher costs of revenue (EUR 0.6 m).

In the first quarter of 2016, Evotec’s Group revenues grew to EUR 37.5 m, an increase of 74% compared to the same period of the previous year (2015: EUR 21.5 m). This increase resulted primarily from an increase in base revenues across all business units and the contribution from the Sanofi collaboration. Excluding milestones, upfronts and licences, Evotec’s revenues for the first quarter of 2016 were EUR 33.9 m, an increase of 83% over the same period of the previous year (2015: EUR 18.5 m). Revenues from milestones, upfronts and licences increased to EUR 3.6 m compared to the same period of the previous year (EUR 3.0 m). The gross margin amounted to 33.3% in the first three months of 2016 (2015: 28.0%). This significant margin increase over 2015 primarily reflects growth in base revenues, improved capacity utilisation as well as favourable foreign exchange rate effects.

In the first quarter of 2016, Evotec’s R&D expenses amounted to EUR 4.4 m (2015: EUR 3.8 m). This increase is in-line with the Company’s strategic plans and primarily results from significant investments in acquired oncology projects and intensified investments in CNS projects. Selling, general and administrative (SG&A) expenses increased by 5% in the first quarter of 2016 to EUR 5.4 m (2015: EUR 5.1 m) and were mainly impacted by ongoing costs at Toulouse site.

Adjusted Group EBITDA in the first quarter of 2016 was positive and amounted to EUR 7.2 m (2015: EUR (0.3) m). EBITDA was adjusted for changes in contingent consideration. Evotec’s operating income in the first quarter of 2016 amounted to EUR 2.7 m (2015: operating loss of EUR 3.3 m).

Liquidity, which includes cash and cash equivalents (EUR 49.2 m) and investments (EUR 73.3 m) amounted to EUR 122.5 m as of 31 March 2016 (31 December 2015: EUR 133.9 m) and remained on a high level even though the first quarter of 2016 was affected by bonuses, extraordinary and advance payments. In the current low and negative interest rate environment, the Company is considering options to reduce outstanding levels of debt during Q2 2016 while maintaining future access to such financing. Debt reduction would be possible due to the current strength of the underlying business and the strong liquidity position of the Company.

Revenues from the EVT Execute segment amounted to EUR 38.6 m in the first quarter of 2016 (2015: EUR 23.1 m) and included EUR 7.5 m of intersegment revenues (2015: EUR 5.4 m). This sharp increase was mainly driven by the strong performance of the base business, the milestone achievement in the Padlock collaboration and the contribution from the Sanofi transaction. The EVT Innovate segment generated revenues of EUR 6.4 m (2015: EUR 3.8 m) consisting entirely of third-party revenues. This increase compared to the prior year results mainly from EVT Innovate projects which were partnered in 2015. Gross margin for EVT Execute amounted to 26.1% while EVT Innovate generated a gross margin of 46.1%. R&D expenses for the EVT Innovate segment amounted to EUR 4.9 m in the first quarter of 2016 (2015: EUR 4.6 m) and continued the upward trend compared to previous quarters. In the first quarter of 2016, the adjusted EBITDA (before changes in contingent consideration) of the EVT Execute segment was strongly positive at EUR 9.6 m and improved compared to the same period of the previous year (2015: EUR 3.5 m). The EVT Innovate segment reported a negative EBITDA before changes in contingent consideration of EUR (2.4) m but has improved over the prior year (2015: EUR (3.8) m) due to new EVT Innovate partnerships based on Cure X/Target X initiatives signed in 2015.

2. EVT Execute and EVT Innovate

EVT Execute – ACCELERATED GROWTH IN BASE BUSINESS

The first quarter of 2016 saw a strong operational performance in the EVT Execute segment. Important milestones were achieved in ongoing collaborations (Padlock; Bayer (after period-end)). In addition, the base business gained further momentum, especially with regards to compound management services, which was further demonstrated by new multi-year compound management agreements which Evotec entered with UCB at the end of 2015 and with Pierre Fabre just after period-end.

EVT Innovate – FIRST-IN-CLASS CURE X/TARGET X STRATEGY

In the EVT Innovate segment, Evotec recorded a research grant which was awarded from The Michael J. Fox Foundation to further develop Evotec’s TargetaSN (Targetalpha-synuclein) programme for the treatment of Parkinson’s disease. This programme is part of a larger internal initiative to address neurodegenerative diseases through highly innovative approaches involving patient-derived stem cells and genetically validated mechanisms. Furthermore, good progress was demonstrated in existing partnerships and development projects in the first quarter: The clinical studies for EVT201 in China are running according to plan. EVT801 and other oncology projects are progressing well. Good progress was achieved in the kidney collaboration with AstraZeneca. Regarding Evotec’s legacy pipeline, Evotec was informed by Janssen Pharmaceuticals, Inc. that Janssen intends to phase out the agreement regarding NMDA antagonists as of August 2016. This is reflected in a full impairment of the asset in the amount of EUR 1.4 m.

3. EVT Equity – Company formation to accelerate drug discovery and product development

In March 2016, Evotec announced the formation of a spin-off company, called Topas Therapeutics GmbH ("Topas"), focused on the field of nanoparticle-based therapeutics to treat immunological disorders. Epidarex Capital, EMBL Ventures and Gimv participated together with Evotec in a EUR 14 m ($ 15.75 m) Series A financing round of Topas. Evotec will remain the largest shareholder after the financing round. The new company aims to build a unique pipeline of clinical-stage development projects to treat autoimmune diseases. The establishment of Topas is the first example of an acceleration of Evotec’s business model to take advantage of carving out promising programmes with upside potential on a shared risk and shared success basis.

4. Management Board updates and strengthening of Global Human Resources capacities

The Supervisory Board has agreed to the extension of the service contract of Dr Werner Lanthaler as CEO of the Company for another five years to 2021 and the extensions of the contracts of Dr Mario Polywka as COO and Dr Cord Dohrmann as CSO for a further three years to 2019. Colin Bond has decided not to extend his contract and will leave the Company at his own request when his current contract as CFO expires at the end of June 2016.

The Supervisory Board of Evotec has appointed Enno Spillner as its new Chief Financial Officer and member of the Management Board effective 18 July 2016. Enno Spillner has most recently served as Chairman of the Management Board and CEO/CFO of 4SC AG since April 2013. He joined 4SC AG as CFO in September 2005. Before working for 4SC AG, Enno Spillner was Head of Finance and Controlling at BioM AG, a German regional biotech venture fund, which he joined at the beginning of 1999. In this role, he was responsible for managing investments in the equity portfolio and also held the position of interim Managing Director at two portfolio companies. Enno Spillner earned his Dipl.-Kaufmann degree (Masters in Economics) at the University of Bamberg, Germany. He also is a member of the Supervisory Board and Chairman of the audit committee at Nanobiotix, Paris.

To support the growth and increase attention to its human talent, the Management Board of Evotec has appointed Ms Monika Conradt Global Head of Human Resources. Ms Conradt joins Evotec from Boehringer Ingelheim, where she has been HR Manager Europe.

Dr Werner Lanthaler, Chief Executive Officer of Evotec, commented: "On behalf of the Management Board and the Company, I would like to thank Colin for his most valuable contributions over the past six years. He was outstanding in the challenge and balance that he provided to the Management Team. Colin Bond has made many essential contributions to the strategic development of Evotec. We will closely stay in touch with him and we wish him ongoing success for his future endeavours in a key position at one of our drug discovery partners. I am delighted to welcome Enno Spillner to our team as new Chief Financial Officer and Monika Conradt as Global Head of Human Resources."

5. Guidance 2016 confirmed

Guidance 2016 Actual 2015
Base revenues1) >15% EUR 115.4 m
Adjusted Group EBITDA2) Positive and significantly improved to prior year EUR 8.7 m
R&D expenses Approx. EUR 20 m EUR 18.3 m
Liquidity3) Similar level to prior year EUR 134.5 m
Capex investments Up to EUR 10 m EUR 11.2 m
1) Excluding milestones, upfronts and licences

2) Before contingent considerations, income from bargain purchase and excluding impairments on goodwill, other intangible and tangible assets as well as the total non-operating result
3) Excluding M&A and related payments

On May 10, 2016 IntelGenx Corp. (TSX-V: IGX) (OTCQX: IGXT) (the "Company" or "IntelGenx") reported its first quarter 2016 financial results for the three-month period ended March 31, 2016 (Filing, Q1, IntelGenx, 2016, MAY 10, 2016, View Source [SID:1234512491]). All amounts are in U.S. Dollars unless otherwise stated. The Company will host a conference call to provide a corporate update on Thursday, May 12th at 9:00 a.m. ET. Details of the conference call and webcast are listed below in this release.

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2016 First Quarter Financial Highlights:

• Revenues reached $818 thousand, an increase of 31% over the same period last year

• Net comprehensive loss was ($707 thousand), compared to a net comprehensive loss of ($377 thousand) over the same period last year

• Adjusted EBITDA loss was ($556 thousand), compared to adjusted EBITDA of $51 thousand over the same period last year

• Cash and cash equivalents totaled $2.1 million as at March 31, 2016
Recent Operational Highlights:

• Net sales of Forfivo XL in the first quarter of 2016 increased by 39% to $2.5 million ($4.9 million gross) compared to net sales of $1.8 million ($3.3 million gross) over the same period last year

• Submitted a patent application with the U.S. patent office for an oral film dosage form containing Loxapine for the treatment of anxiety and aggression in patients suffering from schizophrenia or bipolar 1 disorder

• Granted from the USPTO a patent protecting Rizaport, an oral thin film formulation of Rizatriptan benzoate for the treatment of acute migraines. This patent protects the composition of Rizaport and will be listed in the Orange Book upon approval of the product by the FDA

• Announced a development and commercialization term sheet with a global pharmaceutical company for up to three products. If entered into, IntelGenx expects the definitive agreement to be finalized in the second quarter of 2016

• Signed a commercialization term sheet for RizaportTM with Grupo Juste for Spain and additional potential territories. If entered into, IntelGenx expects the definitive agreement to be finalized in the second quarter of 2016

• Construction was successfully completed on the new state-of-the-art manufacturing and laboratory facilities which are expected to be fully operational by 2017. All of the new manufacturing equipment has been delivered and is being installed

"We made significant progress to start the year with the clear goal of transforming IntelGenx into a global leader of innovative pharmaceutical oral film development and manufacturing," said Dr. Horst G. Zerbe, President and CEO of IntelGenx. "Several key initiatives were successfully achieved with the completion of the construction of our state-of-the-art manufacturing facilities, the strengthening of our management team and the execution of two commercialization term sheets for a total of four products. The new team has been working hard together to build on each other’s strengths in laying out IntelGenx’ foundation for long-term growth. We very much look forward to communicating with shareholders on the future success of the organization."

Financial Results:

Total revenues for the three-month period ended March 31, 2016 amounted to $818 thousand, representing an increase of $193 thousand or 31% compared to $625 thousand for the three-month period ended March 31, 2015. The increase for the three-month period ended March 31, 2016 compared to last year’s corresponding period is mainly attributable to the attainment of milestones, totaling $3 million from which $2.67 million was recorded in the last fiscal year and $333 thousand in the first quarter of 2016.

Operating costs and expenses were $1.5 million for the three-month period ended March 31, 2016 compared to $610 thousand for the corresponding period of 2015. The increase for the three-month period ended March 31, 2016 is mainly attributable to an increase in Research and Development expenses of $364 thousand and Selling, General and Administrative of $498 thousand.

For the first quarter of 2016, the Company generated an operating loss of ($706 thousand) compared to an operating gain of $15 thousand for the comparable period of 2015.

Net comprehensive loss was ($707 thousand) or ($0.01) on a basic and diluted per share basis for the first quarter of 2016 compared to a net comprehensive loss of ($377 thousand) or ($0.00) on a basic and diluted per share basis for the comparable period of 2015.

Cash on hand as at March 31, 2016 was $2.1 million, representing a decrease of ($798 thousand) compared with the balance of $2.9 million as at December 31, 2015. The decrease in cash relates to the comprehensive loss incurred in the first quarter.

On May 10, 2016 Ignyta, Inc. (Nasdaq: RXDX), a precision oncology biotechnology company, reported company highlights and financial results for the first quarter ended March 31, 2016 (Press release, Ignyta, MAY 10, 2016, View Source [SID:1234512213]).

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"During 2016, we have continued to make significant progress towards becoming a leading precision medicine company focused on the development of first-in-class and best-in-class therapies for the benefit of cancer patients, and we have steadily advanced each of our three clinical stage assets," said Jonathan Lim, M.D., Chairman and CEO of Ignyta. "For our lead program, entrectinib, we have continued to successfully execute our potentially registration-enabling Phase 2 clinical trial, STARTRK-2. We also announced at the AACR (Free AACR Whitepaper) Annual Meeting compelling results from our two Phase 1 clinical trials, highlighting entrectinib’s emerging safety and efficacy profile. For the RXDX-105 program, we selected a recommended Phase 2 dose and initiated the Phase 1b portion of our ongoing clinical trial. For the taladegib program, we reported a complete response in a patient with medulloblastoma – providing the first clinical proof of concept for taladegib in a solid tumor type outside of advanced basal cell carcinoma. Finally, we strengthened our balance sheet, enabling us to continue to move rapidly to develop meaningful new therapies for the benefit of cancer patients."

Company Highlights

Updated Entrectinib Data Presented at AACR (Free AACR Whitepaper) Annual Meeting

In April 2016, updated results of the two Phase 1 clinical trials of entrectinib, the company’s proprietary oral tyrosine kinase inhibitor targeting solid tumors harboring activating alterations to NTRK1, NTRK2, NTRK3, ROS1, or ALK, were presented in an oral plenary session at the 2016 Annual Meeting of the American Association for Cancer Research (AACR) (Free AACR Whitepaper) in New Orleans, Louisiana.

The data cut-off for the AACR (Free AACR Whitepaper) presentation was March 7, 2016. Highlights of the data included:

Safety

A total of 119 patients with a range of solid tumors had been dosed across the two Phase 1 clinical trials, with 45 patients treated at the recommended Phase 2 dose (RP2D) of 600 mg, taken orally once per day (QD).

Entrectinib was well tolerated:

Across both studies, the most frequent (>10% incidence) treatment-related adverse events were fatigue (44%), dysgeusia (41%), paresthesia (28%), nausea (24%), and myalgia (22%).
The vast majority of treatment-related adverse events were Grade 1 or 2 in severity.
The most frequent (>2% incidence) Grade 3 treatment-related adverse events were fatigue (4%) and anemia (3%).
Adverse events were reversible with dose modification.
There was no evidence of cumulative toxicity, hepatic or renal toxicity, or QTc prolongation.
Efficacy

Across the two Phase 1 clinical studies, there were 25 patients treated who met the company’s Phase 2 clinical trial eligibility criteria, which include:

Presence of NTRK1/2/3, ROS1, or ALK gene rearrangements, as opposed to other types of molecular alterations (e.g., SNPs, amplifications, deletions);
Naïve to inhibitors of the relevant target (Trk, ROS1, or ALK, respectively); and
Treatment at or above the RP2D.
Among the 25 patients treated who met the company’s Phase 2 clinical trial eligibility criteria, tumor regression was seen in 80% (20 out of 25 treated patients):

Twenty-four patients had tumors that were evaluable by RECIST criteria. The overall response rate by RECIST was 79% (19 responses, including two complete responses, out of 24 treated patients, as assessed and confirmed by the clinical sites).
One patient had an astrocytoma. Assessment by RECIST criteria demonstrated stable disease. However, since RECIST criteria are not validated for primary brain tumors, the clinical site performed three-dimensional volumetric analysis of this patient’s tumor to determine changes in tumor size, which resulted in an estimated 45% decrease in tumor size from baseline.
The responses included:
with respect to patients with NTRK1/2/3 gene rearrangements who met the company’s Phase 2 eligibility criteria, three confirmed responses out of three patients evaluable by RECIST criteria, one of whom had metastases to the central nervous system that resulted in a complete response. In addition, a patient with an astrocytoma had a response as determined by volumetric analysis. Two of these Trk patients remained on study, one of whom had been on study for longer than 12 months;
with respect to patients with ROS1 gene rearrangements who met the company’s Phase 2 eligibility criteria, 12 confirmed responses out of 14 patients, including 11 confirmed responses out of 13 patients with non-small cell lung cancer (NSCLC). Eleven of the ROS1 responders remained on study in response, with the longest at 27 months. One ROS1 NSCLC patient has met the criteria for RECIST progression but has remained on study due to clinical benefit; and
with respect to patients with ALK gene rearrangements who met the company’s Phase 2 eligibility criteria, four confirmed responses out of seven patients, with another patient having stable disease. Two of the responders remained on study in response, as did the patient with stable disease.
Many of these responses occurred rapidly, within the first four weeks of entrectinib treatment. Seventeen of the patients remained on study treatment, having received up to 27 months of treatment. Of note, three of four patients with primary or metastatic central nervous system (CNS) disease responded.

In addition, the AACR (Free AACR Whitepaper) presentation included a late-breaking case study of a 20-month-old baby boy with NTRK3-rearranged infantile fibrosarcoma that had metastasized to the brain, who had exhausted all available therapies and was enrolled under a compassionate use protocol and therefore was not included in the Phase 1 cohort. The patient was first dosed in February 2016, and after five weeks of treatment experienced a decrease in his brain lesions of approximately 58%, as estimated from radiology assessment, with accompanying clinical improvement.

Expansion of RXDX-105 Clinical Trial

In March 2016, the company announced the selection of an RP2D and the initiation of the Phase 1b portion of its Phase 1/1b clinical trial of RXDX-105, the company’s orally available, small molecule multikinase inhibitor with potent activity against such targets as RET and BRAF. The Phase 1b portion of the study utilizes a basket design focusing on patients with solid tumors that contain molecular alterations of RET or BRAF. In addition, based on clinical data seen to date, the company intends to build into the Phase 1b portion of the study one or more baskets to evaluate RXDX-105 in both squamous non-small cell lung cancer and non-small cell lung adenocarcinoma.

Taladegib Complete Response Outside of Basal Cell Carcinoma

In April 2016 at the AACR (Free AACR Whitepaper) Annual Meeting, the company reported the first clinical proof of concept for taladegib in a solid tumor type outside of advanced basal cell carcinoma, in a patient with medulloblastoma who had a complete response. The company further announced that it would be exploring medulloblastoma and other solid tumor types driven by hedgehog pathway alterations in a Phase 1b basket study, which is expected to be initiated in the third quarter of 2016.

Financing Transaction

In May 2016, the company issued an aggregate of 9.2 million shares of its common stock in an underwritten public offering at a purchase price of $6.25 per share, which resulted in aggregate gross proceeds of $57.5 million.

First Quarter 2016 Financial Results

For the first quarter of 2016, net loss was $25.5 million, or $0.79 per share, compared with $23.5 million, or $1.15 per share, for the first quarter of 2015.

Ignyta did not record any revenue for the three months ended March 31, 2016, or for the three months ended March 31, 2015.

Research and development expenses for the first quarter of 2016 were $19.8 million, compared with $20.2 million for the first quarter of 2015. During the first quarter of 2015, the company recorded an in-process research and development charge representing the net value of the assets exchanged for the intellectual property assets acquired from Teva, as well as related transaction and drug product costs. Excluding these costs, research and development costs would have increased in 2016 as compared to 2015 by $12.7 million, primarily due to an $8.0 million increase in the development costs associated with the company’s entrectinib, taladegib, and other product candidates. The remaining increase in costs between periods was due to personnel expenses related to hiring and engaging additional employees and consultants to help advance the company’s product candidates.

General and administrative expenses were $5.2 million for first quarter of 2016, compared with $2.8 million for first quarter of 2015. The increase was primarily caused by increases in personnel costs, as well as higher facilities-related expenses resulting from the expansion of the company’s leased facilities space. The increase was also attributable to increases in legal and intellectual property costs, consulting fees, and depreciation expenses.

At March 31, 2016, the company had cash, cash equivalents, and available-for-sale securities totaling $151.2 million and current and long-term debt of approximately $31.0 million. This balance does not include the gross proceeds of $57.5 million from the May 2016 underwritten public offering. At December 31, 2015, the company had cash, cash equivalents, and available-for-sale securities totaling $172.1 million and current and long-term debt of $31.0 million.

On May 10, 2016 Jazz Pharmaceuticals plc (Nasdaq: JAZZ) reported financial results for the first quarter of 2016 and updated financial guidance for 2016 (Filing, Q1, Jazz Pharmaceuticals, 2016, MAY 10, 2016, View Source [SID:1234512492]).

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"During the first quarter of 2016, we executed on our business model by delivering strong top- and bottom-line growth and commenced promotion of Defitelio in the U.S. immediately following FDA approval. Defitelio is the first and only approved treatment in the U.S. for patients who develop hepatic VOD with renal or pulmonary dysfunction following hematopoietic stem-cell transplantation," said Bruce C. Cozadd, chairman and chief executive officer of Jazz Pharmaceuticals plc. "For 2016, we will continue to invest in the organic growth of our key products, including new indications, and the advancement of our development pipeline. Diversification of our product portfolio through internal and corporate development efforts remains a high priority as we seek to identify and acquire differentiated and long-lived therapeutic options for patients."

Adjusted net income for the first quarter of 2016 was $141.0 million, or $2.26 per diluted share, compared to $125.1 million, or $1.99 per diluted share, for the first quarter of 2015.

GAAP net income for the first quarter of 2016 was $74.1 million, or $1.19 per diluted share, compared to $70.7 million, or $1.12 per diluted share, for the first quarter of 2015. Reconciliations of applicable GAAP reported to non-GAAP adjusted information are included in this press release.

Financial Highlights

Three Months Ended March 31,

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

2015

Change
Total revenues
$
336,010

$
309,303

8.6
%
Adjusted net income
$
140,995

$
125,068

12.7
%
GAAP net income
$
74,121

$
70,700

4.8
%
Adjusted EPS
$
2.26

$
1.99

13.6
%
GAAP EPS
$
1.19

$
1.12

6.3
%

Total Revenues
Total revenues were as follows:

Three Months Ended March 31,
(In thousands)
2016

2015
Xyrem (sodium oxybate) oral solution
$
249,537

$
212,690

Erwinaze / Erwinase (asparaginase Erwinia chrysanthemi)
51,173

50,353

Defitelio (defibrotide sodium) / defibrotide
17,897

17,363

Prialt (ziconotide) intrathecal infusion
6,209

6,764

Psychiatry
7,002

9,093

Other
2,098

10,772

Product sales, net
333,916

307,035

Royalties and contract revenues
2,094

2,268

Total revenues
$
336,010

$
309,303

Net product sales increased by 9% in the first quarter of 2016 compared to the same period in 2015 primarily due to higher net product sales of Xyrem.
Erwinaze/Erwinase net product sales increased by 2% in the first quarter of 2016 compared to the same period in 2015. Although Erwinaze net product sales increased, as a consequence of constrained manufacturing capacity, the company has had a limited ability to build sufficient inventory levels that can be used to absorb supply disruptions. In the first quarter of 2016, the company experienced supply challenges that temporarily disrupted its ability to supply certain markets.
Defitelio/defibrotide product sales increased by 3% in the first quarter of 2016 compared to the same period in 2015. The increase in net product sales was partially offset by the impact of foreign exchange on sales made in euro.

Operating Expenses
Operating expenses were as follows:

Three Months Ended March 31,
(In thousands, except percentages)
2016

2015
GAAP:

Cost of product sales
$
23,439

$
28,298

Gross margin
93.0
%

90.8
%
Selling, general and administrative
$
128,765

$
112,388

% of total revenues
38.3
%

36.3
%
Research and development
$
31,252

$
27,181

% of total revenues
9.3
%

8.8
%
Acquired in-process research and development
$
8,750

$
—

Non-GAAP adjusted:

Cost of product sales
$
22,640

$
27,603

Gross margin
93.2
%

91.0
%
Selling, general and administrative
$
102,611

$
95,041

% of total revenues
30.5
%

30.7
%
Research and development
$
27,962

$
23,696

% of total revenues
8.3
%

7.7
%

Operating expenses changed over the prior year period primarily due to the following:
•
Selling, general and administrative (SG&A) expenses increased in the first quarter of 2016 compared to the same period in 2015, on a GAAP and non-GAAP adjusted basis, primarily due to higher headcount and other expenses resulting from the expansion of the company’s business.
•
Research and development (R&D) expenses increased in the first quarter of 2016 compared to the same period in 2015, on a GAAP and non-GAAP adjusted basis, primarily due to higher costs for clinical studies and outside services for the development of JZP-110 and line extensions for the company’s existing products.
•
Acquired in-process research and development (IPR&D) expense in the first quarter of 2016 related to an upfront payment of $8.8 million the company made in connection with its acquisition of intellectual property and know-how related to recombinant crisantaspase.

Cash Flow and Balance Sheet
As of March 31, 2016, cash, cash equivalents and investments were $980.5 million, and the outstanding principal balance of the company’s long-term debt was $1.3 billion. Cash, cash equivalents and investments decreased during the quarter primarily due to repurchases under the company’s share repurchase program, partially offset by cash generated by the business. During the first quarter of 2016, the company repurchased 1.1 million ordinary shares for $134.4 million, at an average cost of $123.77 per ordinary share.
In March 2016, the company recorded a $150.0 million milestone owed to Sigma-Tau Pharmaceuticals, Inc., which was triggered by the U.S. Food and Drug Administration approval of Defitelio on March 30, 2016. The milestone was capitalized as an intangible asset and was paid by the company in April 2016.

2016 Financial Guidance
Jazz Pharmaceuticals is updating its full year 2016 financial guidance, which is as follows (in millions, except per share amounts and percentage):
Revenues
$1,490-$1,550
Total net product sales
$1,482-$1,542
-Xyrem net sales
$1,095-$1,130
-Erwinaze/Erwinase net sales
$200-$225
-Defitelio/defibrotide net sales
$100-$125
Adjusted gross margin %1,4
93%
Adjusted SG&A expenses2,4
$390-$410
Adjusted R&D expenses3,4
$115-$130
GAAP net income per diluted share
$6.76-$7.41
Non-GAAP adjusted net income per diluted share*,4
$11.10-$11.50
_____________________________
*
Updated May 10, 2016 to reflect a decrease in weighted-average shares to 62 million.
1.
Excludes $6 million of share-based compensation expense from estimated GAAP gross margin of 93%.
2.
Excludes $87-$95 million of share-based compensation expense and $6 million of expenses related to certain legal proceedings and restructuring from estimated GAAP SG&A expenses of $483-$511 million.
3.
Excludes $17-$19 million of share-based compensation expense from estimated GAAP R&D expenses of $132-$149 million.
4.
See "Non-GAAP Financial Measures" below. Reconciliations of non-GAAP adjusted guidance measures are included above and in the tables accompanying this press release.