On December 17, 2015 OXiGENE, Inc. (Nasdaq:OXGN), a biopharmaceutical company developing vascular disrupting agents (VDAs) for the treatment of cancer, reported that the European Commission has granted orphan drug designation to OXi4503 for the treatment of acute myeloid leukemia (AML) (Press release, OXiGENE, DEC 17, 2015, View Source [SID:1234508604]). The designation provides for ten years of marketing exclusivity in EU member countries following product approval. OXi4503 has previously received orphan drug designation from the U.S. Food and Drug Administration, which provides for seven years of marketing exclusivity after approval.

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"The European Commission’s decision highlights the need for new AML treatment options and improves the commercial potential of OXi4503," stated William D. Schwieterman, M.D. President and Chief Executive Officer of OXiGENE. "We have recently put plans in place to accelerate the development of this promising agent by immediately advancing into the next phase of our ongoing phase 1b/2 clinical trial in the U.S., in which OXi4503 will be used in combination with the approved AML drug cytarabine instead of as a stand-alone investigational agent for the treatment of refractory AML."

Orphan designation in the European Union is granted to product candidates that are intended to treat life-threatening or chronically-debilitating conditions that affect no more than five patients per 10,000 of the EU population. Among other benefits, orphan designation provides for regulatory assistance and scientific advice from the European Medicines Agency during product development.

About OXiGENE

OXiGENE is a clinical-stage biopharmaceutical company developing vascular disrupting agents (VDAs) to treat cancer. VDAs selectively disrupt abnormal blood vessels that sustain tumors. The company’s investigational drugs include CA4P (fosbretabulin), which is in development as a treatment for solid tumors, and OXi4503, which is in development for acute myeloid leukemia (AML). OXiGENE is dedicated to leveraging its intellectual property and therapeutic development expertise to bring life-extending and life-enhancing medicines to patients.

On December 17, 2015 Ligand Pharmaceuticals Incorporated (NASDAQ: LGND) and OMT, Inc. (Open Monoclonal Technology) reported the signing of agreements for Ligand to acquire OMT, Inc., a leader in genetic engineering of animals for the generation of human therapeutic antibodies through its OmniAb platform (Press release, Ligand, DEC 17, 2015, View Source [SID1234517241]).

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OMT has leading antibody drug discovery technology and is believed to be the only company in the world offering three transgenic animal platforms for license. Its license agreements with biotechnology partners will initially add 16 shots on goal to Ligand, as well as future potential licensing deals and additional compounds generated from existing partnerships. OMT has existing licenses with Amgen, Celgene, Genmab, Janssen, Merck KGaA, Pfizer, Seattle Genetics, Five Prime, Symphogen and various other biotechnology and pharmaceutical companies. OMT is privately held and is majority owned by Essex Woodlands.

Under the terms of the transaction, Ligand will pay OMT shareholders approximately $178 million, including $92.6 million in cash and $85.4 million in Ligand common stock. Roland Buelow, Ph.D., founder of OMT and a world-renowned antibody researcher, is expected to join Ligand as Vice President of Antibody Technologies and continue working with Ligand on advancing the OMT business. The transaction is subject to customary closing conditions and is expected to close in January 2016.

"OMT is an ideal strategic fit for Ligand and holds potential to have a profoundly positive impact on our business over the long term," said John Higgins, Chief Executive Officer of Ligand Pharmaceuticals. "OMT brings a robust and important technology for biologic drug discovery that we believe will stand next to Captisol in terms of opportunity for partner events, new licensing transactions and financial contribution. The transaction is expected to be accretive to revenue and adjusted earnings, and if products are approved in the future, the underlying royalties could generate substantial revenues for decades to come. This transaction is a major addition to what Ligand believes is an unprecedented portfolio of more than 140 fully-funded partnered programs."

"OMT has created a highly successful business around the OmniAb antibody technology platform and the business has significant growth potential," said Roland Buelow, Ph.D., Chief Executive Officer of OMT. "We are very impressed with Ligand’s business model, success in deal making and commitment to continue driving the OMT business to even greater success. We believe Ligand’s broad licensing network, business acumen, financial resources and commitment to our technology create an attractive exit for OMT shareholders. I am personally excited to join Ligand as an employee and shareholder, and look forward to helping the talented team continue to expand its business."

OMT OmniAb Antibody Platform

OmniAb refers to three industry-recognized transgenic animal platforms for generation of naturally optimized monospecific, bispecific and polyspecific human therapeutic antibodies.

OmniRat is one of the industry’s first human monoclonal antibody technology based on rats. It has a complete immune system with a diverse antibody repertoire and is genetically engineered to produce antibodies with human idiotypes.

OmniMouse is a transgenic mouse that complements OmniRat and expands epitope coverage and therefore antibody discovery capabilities for partners.

OmniFlic is an engineered rat with a fixed light chain for development of bispecific, fully human antibodies.

All three platforms use patented technology and deliver fully human antibodies with high affinity, specificity, expression, solubility and stability, thereby facilitating more rapid discovery of therapeutic antibodies for partners. OmniAb allows partners to identify high-affinity antibodies in a patented animal system, that therefore have been optimized by in vivo selection pressures, accelerating development times and increasing the prospects of technical success compared with traditional antibody-generation technologies.

Antibodies are a major and growing segment of the pharmaceutical industry. Five of the top 10 selling medicines in 2014 were antibodies. The top 10 selling antibodies in 2014 generated total revenue of $57 billion and the number of antibodies in clinical development has tripled over the past seven years from 150 to 468 currently.

Acquisition Rationale

There are multiple aspects of this transaction that support the strategic rationale to Ligand, including:

1. Financial Contribution – Projected to be accretive to revenues and adjusted earnings with potential for significant financial contribution to Ligand through future royalties.

2. Portfolio Expansion – Major addition of new partners and fully-funded shots on goal. OMT is expected to initially bring to Ligand 16 new shots on goal, and Ligand is projected to have more than 140 fully-funded programs and more than 83 partners after the OMT transaction closes.

3. Technology Diversification – Diversification of Ligand’s technology offering for licensing. OmniAb is a broad and robust technology platform and is a key resource used by biotechnology companies to discover new biologic drugs. The OMT technology is expected to be a new pillar of Ligand’s business, standing alongside the Captisol drug-formulation technology. OmniAb will create a strong platform for Ligand to seek new licenses and partnerships.

4. Royalty Extension – Significant extension of potential patent protection period and royalty terms for Ligand-partnered programs. Patents for OMT technology run through 2033, but each newly discovered antibody may be the basis for its own novel intellectual property, resulting in patents for each antibody on a drug-by-drug basis that could extend past 2040.

Acquisition and OMT Business Highlights

Following are some of the highlights of the OMT business and their expected impact on Ligand:

OMT diversifies Ligand’s business by adding a proprietary antibody-generating platform, giving Ligand further exposure to an important segment of the pharmaceutical industry. OMT has three distinct transgenic rodent systems for generating antibodies: OmniRat, OmniMouse and OmniFlic.
Ligand projects up to three antibodies from the OMT platform will be in human Phase 1 trials by the end of 2017 and as many as 15 antibodies could be in Phase 1 or more advanced trials by 2020.
OMT OmniAb licenses have generally been structured with a combination of license fees, annual technology access fees, milestone payments and royalties. Royalties are generally in the low- to mid-single digits. The existing OMT portfolio is comprised of platform licenses with high-quality companies.
With the acquisition, Ligand is acquiring 16 platform partnerships and antibody-specific licenses. Following the transaction, Ligand will have partnerships with 83 different companies and over 140 fully funded programs with each OMT platform deal currently counting as one shot on goal.
The OMT business is projected to add $6 million and $12 million of revenues to Ligand in 2016 and 2017, respectively. This revenue is based on existing licensing contracts and potential payments, and does not include revenue from potential new partnerships and programs. Annual expenses to operate the OMT business are projected to be between $3 million and $5 million.
The acquisition of the existing OMT business and licenses will accelerate Ligand’s projected financial growth. The transaction is projected to add 5% to 2016 revenue and 7% to 10% to annual revenue over the next decade, after which time initial royalty-bearing products could be approved with contribution to revenue growth being potentially much greater thereafter. The transaction is projected to be slightly accretive to adjusted EPS in 2016 and accretive to adjusted EPS by approximately 4% to 8% per year over the next several years.
Ligand Pro Forma 2016 and 2017 Financial Outlook

Including this acquisition, Ligand expects 2016 total revenues to be between $113 million and $117 million. This guidance assumes approximately $6 million of revenue from the OMT business in 2016, and approximately $107 million to $111 million of revenue from the original Ligand business. Ligand’s pro forma 2016 cash operating expenses are expected to be between $26 million and $28 million. In 2016, adjusted EPS is projected to be unchanged and in the range of $3.33 to $3.38.

For 2017, Ligand expects total revenues to exceed $158 million with adjusted EPS of more than $4.95. This guidance assumes approximately $12 million of revenue from the OMT business in 2017, and approximately $0.20 of incremental EPS contribution from the acquisition.

OMT non-cash amortization expense estimates are expected to be determined in the near term. Amortization charges will be recognized in GAAP EPS and the non-cash charge will be excluded from adjusted EPS.

Adjusted Financial Measures

The adjusted financial measures discussed above exclude changes in contingent liabilities, mark-to-market adjustment for amounts owed to licensors, non-cash stock-based compensation expense, non-cash debt-related costs, pro-rata non-cash net losses of Viking Therapeutics, non-cash OMT purchase price amortization and non-cash tax expense.

Ligand believes that the presentation of adjusted financial measures provides useful supplementary information to investors and reflects amounts that are more closely aligned with the cash profits for the period as the items that are excluded from adjusted net income are all non-cash items. Ligand uses these adjusted financial measures in connection with its own budgeting and financial planning. These adjusted financial measures are in addition to, and not a substitute for, or superior to, measures of financial performance prepared in conformity with GAAP.

On December 16, 2015 Provectus Biopharmaceuticals, Inc. (NYSE MKT: PVCT, www.pvct.com), a clinical-stage oncology and dermatology biopharmaceutical company ("Provectus"), reported that it will present at Biotech Showcase 2016 (Press release, Provectus Pharmaceuticals, DEC 16, 2015, http://www.pvct.com/pressrelease.html?article=20151216.1 [SID:1234508585]). The Company will summarize its business operations and discuss PV-10, its novel investigational drug for cancer, and PH-10, its topical investigational drug for dermatology.

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The Company’s presentation is currently set for 3:30 pm Pacific Time on January 13, 2016. The presentation is scheduled to take place on Level 4, the Cyril Magnin Foyer.

The presentation will be available on the Company’s website upon conclusion of the live presentation at the conference.

On December 16, 2015 BioInvent International (OMXS: BINV) reported that it is providing an update on its clinical and preclinical drug programs (Press release, BioInvent, DEC 16, 2015, http://www.bioinvent.com/media-centre/press-releases/release/?ReleaseID=6B8448BB1FD836C4 [SID:1234508590]). Several positive interactions with regulatory authorities have taken place and clinical trials with three of the Company’s antibodies are expected to start in 2016. A scientific advice meeting with the UK Medicines and Healthcare Products Regulatory Agency (MHRA) was held in preparation for the first clinical study of BI-1206. The study plan presented to the regulator, as well as BioInvent’s data, were well received. Cancer Research UK plans to submit the Clinical Trial Application in April 2016.

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With an increased commitment to the BI-505 program, BioInvent will submit a clinical trial application to the US Food and Drug Administration (FDA) in December 2015.

BioInvent and its partner Oncurios is planning to start a clinical trial with TB-403 in medulloblastoma during early 2016.
BioInvent has established itself as a company with strong clinical programs and a strong position in the immuno-oncology area.

BI-1206
BI-1206 is an antibody that blocks the CD32b protein which is overexpressed in lymphoma (cancer in the lymphatic system). By combining today’s standard of care therapy rituximab (Rituxan/MabThera) with BI-1206, it is possible to achieve a better anti-tumour effect. The planned Phase l/ll clinical study will be sponsored, managed and funded by one of the world’s largest scientific non-profit organisations, Cancer Research UK. This is done under an agreement with BioInvent as part of the Clinical Development Partnerships Scheme, a joint initiative between the Centre For Drug Development and Cancer Research Technology.
In a recent scientific advice meeting with the MHRA, the design of the first clinical study with BI-1206 was discussed. The study will enrol patients with non-Hodgkin lymphoma and chronic lymphatic leukaemia.

Cancer Research UK plans to submit a Clinical Trial Application for the Phase I/II study to the MHRA in April 2016. The lead clinical site at the University of Southampton and at least three other clinical trial sites in the UK will be involved in the trial and aim to be ready to open to recruitment as soon as all necessary regulatory and ethical approvals are in place.

In collaboration with leading academic institutions, BioInvent has started preclinical evaluation of BI-1206 against different sub-types of non-Hodgkin lymphoma using human material from biobanks. The results will provide an important basis for designing the continuing clinical programme.

"The meeting with the UK regulatory agency, MHRA, is an important step forward for BI-1206. We have reached an important milestone in this highly innovative program. We are now in a good position to advance this program further towards market registration for carefully selected patient cohorts with the greatest medical need," says Michael Oredsson, CEO of BioInvent.

BI-505
BI-505 is a human antibody against ICAM-1 developed by BioInvent, which will be clinically tested in cooperation with researchers at Penn Medicine as an immuno-oncological therapy to prevent or delay relapse in patients with multiple myeloma (a form of bone marrow cancer) undergoing stem-cell transplantation. Preclinical data indicates improved activity against myeloma when BI-505 is administered in combination with Velcade or Revlimid. BI-505’s favourable safety profile has been demonstrated in a previous phase I trial. This and the unique mechanism of action, "flagging" remaining myeloma cells for elimination by actively recruited macrophages, as well as the potential to inhibit ICAM-1 dependent survival signals between myeloma cells and tumour stroma, indicate a unique possibility of improving the therapeutic effect of stem-cell transplantation.
Bioinvent plans to submit an application to the FDA in the USA, requesting to start the randomised, controlled phase II study on multiple myeloma patients undergoing autologous stem-cell transplantation, by December 2015 with Penn Medicine as the coordinating site.

The study is expected to start in the first quarter of 2016, which is in line with previous communication.

BioInvent has decided to assume overall responsibility for the study as sponsor of the trial. This will improve control of data and enable expansion of the trial to additional sites, if required.

"By taking on overall responsibility and increasing the number of trial centres for the study with BI-505 we can generate data of the quality required by authorities to enter into discussions regarding a registration procedure based on successful phase II data," says Anna Teige Wickenberg, Vice President Clinical Development, BioInvent.

TB-403
BioInvent and its partner Oncurious are planning to start a new clinical study with the antibody TB-403 against certain rare forms of cancer in the brain, nervous system and connective tissue in children and adolescents. TB-403 has already been evaluated in clinical studies in adults for other cancers and has demonstrated a good safety profile. The project’s new direction is based on new knowledge about the antibody’s mechanism of action. BioInvent has the right to 40 percent of all future revenue from the project.

The study, which is expected to start in early 2016, will be implemented in cooperation with a network of specialist clinics in the USA with good access to the relevant patient cohorts.
The preparations for study start are well underway.

The first safety evaluation part of the study includes patients with medulloblastoma (tumour in the cerebellum), neuroblastoma (tumour in the sympathetic nervous system), Ewings sarcoma (tumour in the connective tissue) and alveolar rhabdomyosarcoma (tumour in the connective tissue), whereas children with medulloblastoma will be included in the efficacy evaluation part of the study.

"Children who suffer from these serious cancers are in great need of more effective treatment and we have therefore prioritised designing a study that should give us the answer as to whether TB-403 is effective in children with medulloblastoma," says Michael Oredsson, CEO of BioInvent.

REGULATORY T-CELLS (TREG)
Regulatory T-cells (Tregs) have a strong ability to inhibit various immune responses. A series of clinical studies show that antibodies targeting CTLA-4 and PD-1 can induce a very long-lasting response in some cancer patients. BioInvent’s F.I.R.S.T technology platform is an excellent tool for identification of both target structures and antibodies in the Treg area.
BioInvent has succeeded in identifying high-affinity antibodies with depleting activity against regulatory T-cells
A first pool of mouse-reactive anti-Treg antibodies, which can be screened in well- established preclinical models to identify novel targets particularly suitable for antibody-mediated Treg depletion, or modulation of Treg immune suppressive activity, have been identified. Target: antibody pairs will be used to evaluate new drug targets and antibody mechanism-of-action in preclinical proof-of-concept tests, paving way for human cross-reactive, or functionally equivalent human lead clinical candidate antibodies. BioInvent recently announced that the Company has received a non-exclusive licence for a special type of antibody format, IgG2B. Preclinical trials with IgG2B antibodies have shown that this antibody type has the potential to more independently activate immune cells e.g. macrophages and T cells to promote anticancer immune responses. When targeted to appropriate receptors, the IgG2b isotype is expected to increase chances of developing new effective drugs in the immune-oncology area.
OX-40

BioInvent is working in cooperation with Cancer Research Technology (CRT) and the University of Southampton in the UK to develop new immunotherapeutic cancer drugs based on antibodies that target OX-40 and 4-1BB, two known co-receptors that help activate T-cells and long-lasting antitumor immune responses.
Antibodies with high affinity, agonistic activity on effector T-cells and the ability to eliminate regulatory T-cells in vitro have been generated.

Preclinical in vivo studies to document proof-of-concept for BioInvent’s antibodies in the OX-40 project will be initiated during the first quarter of 2016.

TUMOUR ASSOCIATED MYELOID CELLS (TAM)
Myeloid cells are essential to our innate immune system, but they can also be "hijacked" by tumours to support growth and cancer spread. In the fourth quarter of 2015, BioInvent worked on preparations to develop function-modulating antibodies against tumour associated myeloid cells (TAM), a type of white blood cell that is recruited by cancer cells to sustain growth and spread, and prevent immune attack. Antibody-mediated "reprogramming" of immune-suppressive tumour-associated myeloid cells into anti-tumor effector cells is therefore a very attractive therapeutic concept and represents an area of research in which BioInvent and its partners are at the cutting edge.

"F.I.R.S.T is a unique platform to identify new antibody-based drugs that more specifically destroy, or transform, cancer-driving immune cells such as Treg and TAM. Preclinical data indicates that antibodies against Treg and TAM can significantly improve the effects of the immunotherapies available today and make it possible to treat cancers where current immunotherapies aren’t working due to a strongly suppressed immune response to the cancer," says Björn Frendéus, Chief Scientific Officer, BioInvent.

On December 15, 2015 ArQule, Inc. (NASDAQ:ARQL) reported receipt of orphan drug designation from the Food and Drug Administration (FDA) for ARQ 087 in cholangiocarcinoma (Press release, ArQule, DEC 15, 2015, View Source [SID:1234508572]). ARQ 087 is a multi-kinase inhibitor designed to preferentially inhibit the fibroblast growth receptor (FGFR) family.

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ArQule is currently conducting a biomarker-driven phase 2 trial for ARQ 087 in the U.S. and Italy in intrahepatic cholangiocarcinoma (iCCA) patients with FGFR2 fusions. The commencement of the phase 2 trial followed the observation of two confirmed partial responses in iCCA with FGFR2 fusions in the phase 1a portion of the trial. Subsequently, a minor response was observed in a third patient also harboring an FGFR2 fusion.

The phase 2 trial is designed to enroll up to 20 patients and potentially provide a clinical signal to be further explored in an expedited clinical strategy in this rare indication. The incidence rate for iCCA in the U.S. and Europe is approximately one in 100,000, respectively, while the incidence rate in Asia is believed to be higher.

In addition to the phase 2 trial for iCCA, ArQule is continuing to enroll the phase 1b portion of the trial with ARQ 087 in solid tumors harboring FGFR2 genetic alterations. A partial response was recently observed in a bladder cancer patient with an FGFR2 genetic alteration.

"This year we have already received orphan drug designation for ARQ 092 in Proteus syndrome. We are now pleased to have received our second orphan drug designation from the FDA for ARQ 087 in CCA. This is part of our continued pursuit of precision medicine," said Brian Schwartz, M.D., Head of Research and Development and Chief Medical Officer at ArQule. "CCA is a rare cancer that lacks approved therapeutic options to specifically target FGFR2 fusions. We are very encouraged by the clinical efficacy so far observed in the phase 1 portion of the trial which validates the pre-clinical data recently presented at the AACR (Free AACR Whitepaper)-NCI-EORTC conference that demonstrated efficacy across a number of FGFR2-driven tumors in xenograft models."

About Intrahepatic Cholangiocarcinoma

Cholangiocarcinoma is the most common biliary malignancy and the second most common hepatic malignancy after hepatocellular carcinoma (HCC)1. Depending on the anatomic location, CCA is classified as intrahepatic (iCCA), perihilar (pCCA), and extrahepatic (eCCA.) iCCA originates from the intrahepatic biliary ductal system and forms an intrahepatic mass. The average age adjusted incidence rate for iCCA is approximately one in 100,000 per year in the United States and Europe2,3.

About FGFR and ARQ 087

ARQ 087 is a multi-kinase inhibitor designed to preferentially inhibit the fibroblast growth factor receptor ("FGFR") family with demonstrated efficacy in FGFR2 translocations. The FGFR pathway is disrupted in several ways in human cancer, thus providing numerous therapeutic targets for an inhibitor of this pathway. ARQ 087 has demonstrated inhibition of tumor growth and downstream signaling in vivo in tumors whose growth is driven by these targets.

Signals of single agent activity with this compound were observed in phase 1a testing. Phase 1b expansion cohorts with ARQ 087 include patients with cholangiocarcinoma and adrenocortical tumors, as well as those with FGFR translocations, amplifications and mutations. Clinical development of ARQ 087 has advanced into phase 2 for intrahepatic cholangiocarcinoma (iCCA) following the observation of two confirmed responses in this patient population in the phase 1 portion of the program.