On August 4, 2016 Juno Therapeutics, Inc. (NASDAQ: JUNO), a biopharmaceutical company focused on re-engaging the body’s immune system to revolutionize the treatment of cancer, reported financial results and business highlights for the second quarter 2016 (Press release, Juno, AUG 4, 2016, View Source;p=RssLanding&cat=news&id=2193215 [SID:1234514279]).

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"The JCAR015 Phase II ROCKET trial is open again after we amended the protocol to return to a cyclophosphamide-only preconditioning regimen. If the ROCKET data are in the range of the Phase I results, where most patients were treated using this preconditioning regimen, we will have the opportunity to change the standard of care and offer improved hope for adult patients with relapsed or refractory ALL," said Hans Bishop, Juno’s President and Chief Executive Officer. "Additionally, we continue to enroll patients in our JCAR017 trial. We are encouraged that JCAR017, the backbone of our CD19 franchise, will change the standard of care again across a range of B cell malignancies with approvals projected to occur as early as 2018."
Second Quarter 2016 and Recent Corporate Highlights
Clinical Update:

CD19 Portfolio:

JCAR015
Announced the removal on July 12, 2016 by the U.S. FDA of a clinical hold that the agency had placed on the Phase II ROCKET trial on July 6, 2016. The ROCKET trial continues using JCAR015 with cyclophosphamide (cy) preconditioning alone. Juno’s trials and plans for its other CD19-directed CAR T cell product candidates, including JCAR017, were not affected.

Announced interim results, as of May 19, 2016, in Memorial Sloan Kettering Cancer Center’s (MSK) Phase I trial of JCAR015 in adult relapsed or refractory (r/r) acute lymphoblastic leukemia (ALL) patients:
Complete remission was observed in 23/30 (77%) patients with morphologic disease and in 18/20 (90%) patients with minimal disease. In patients who achieved a complete remission and had adequate evaluation for minimal residual disease by flow cytometry or polymerase chain reaction, complete molecular remission (CmR) was observed in 19/21 (90%) patients with morphologic disease and in 14/18 (78%) patients with minimal disease.

Median overall survival (OS) for patients with minimal disease treated with JCAR015 had not been reached yet, and that for morphologic patients treated with JCAR015 was 9 months; median OS follow-up for all patients was 13 months with 40% of patients alive at two years.

Durable responses and survival observed in patients who received JCAR015 were comparable between groups that received a subsequent stem cell transplant and those that did not.

Severe cytokine release syndrome (sCRS) was observed in 14/51 (27%) patients and severe neurotoxicity was observed in 15/51 (29%) patients. For patients with minimal disease, 1/20 (5%) patients experienced sCRS and 4/20 (20%) patients had severe neurotoxicity.

JCAR017
Announced Phase I non-Hodgkin lymphoma (NHL) preliminary efficacy and safety data for the ongoing trial. As of early July, 13 patients were evaluable for safety. Two, or 15%, experienced severe neurotoxicity and no patients experienced sCRS. There are early signs of efficacy with an overall response rate of eight out of ten efficacy-evaluable patients, or 80%, and a complete response rate of seven out of ten, or 70%. We plan to update results with more patients and durability data at a future scientific meeting.

Announced interim results, as of May 17, 2016, from Seattle Children’s ongoing Phase I/II study of JCAR017 in pediatric and young adults with r/r ALL (n=42) demonstrating 39/42 (93%) patients experienced a complete remission, all of which were a CmR by flow cytometry. In patients who received fludarabine/cyclophosphamide (flu/cy) preconditioning followed by JCAR017, 14/14 (100%) achieved a complete remission and a CmR. sCRS was observed in 10/42 (24%) patients and severe neurotoxicity was observed in 10/42 (24%) patients. The rates of sCRS and severe neurotoxicity were similar in the flu/cy and cy cohorts of this trial.
JCAR014 – Announced interim results, as of May 18, 2016, from Fred Hutchinson Cancer Research Center’s (FHCRC) ongoing Phase I/II study of JCAR014 in adults with advanced B cell malignancies:
In efficacy-evaluable ALL patients (n=34), complete remission was reported in 34/34 (100%) patients and a CmR as measured by flow cytometry was achieved in 32/34 (94%) patients. In the cohort that received flu/cy preconditioning followed by JCAR014, 22/22 (100%) of the efficacy-evaluable patients achieved a complete remission, all of which were a CmR. Median disease free survival (DFS) and OS have not yet been reached in this cohort of patients, with follow-up for up to 18 months. sCRS was observed in 14/36 (39%) patients and severe neurotoxicity was observed in 14/36 (39%) patients.

In patients with multiple NHL histologies (n=20), predominantly diffuse large B-cell lymphoma, who received flu/cy preconditioning followed by JCAR014 dose level 2 (2×106/kg), 16/20 (80%) had an overall response (OR), of which 10/20 (50%) experienced a complete response (CR). CRs continued in 70% of patients, ranging from 3 to 11+ months. sCRS was observed in 2/20 (10%) patients and severe neurotoxicity was observed in 2/20 (10%) patients. Notably, 16/20 (80%) patients treated with flu/cy preconditioning followed by JCAR014 dose level 2 were treated in the outpatient setting, and 6/20 (30%) did not require hospitalization during the first 30 days of treatment.

A total of 13 high-risk chronic lymphocytic leukemia (CLL) patients (complex karyotype, del17p, ibrutinib-refractory, ibrutinib-intolerant) received JCAR014 and either non-flu/cy (n=2) or flu/cy (n=11) preconditioning. In the flu/cy patients, the OR rate was 10/11 (91%) patients, of which 5/11 (45%) patients achieved CR. CRs were ongoing in 100% of these five patients with a range of 3 to 19+ months. sCRS was observed in 3/13 (23%) patients and severe neurotoxicity was observed in 3/13 (23%) patients.
JCAR018 – Investigators presented interim data, from the ongoing Phase I study in pediatric and young adult r/r ALL patients at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting 2016 (AACR 2016), showing all three patients at dose level 2 (1 x 106 cells/kg) achieved a complete remission and CmR as measured by flow cytometry. These patients remained in complete remission with follow-up ranging from 3 to 6 months. Limited cytokine release syndrome and no severe neurotoxicity was seen at dose level 2. Dose limiting toxicity was observed at higher doses, so dosing will continue at dose level 2 (1 x 106 cells/kg).

JTCR016 – In the first three solid organ tumor patients treated on the trial, all with mesothelioma, preliminary data, as of early April, presented at AACR (Free AACR Whitepaper) 2016 showed one patient with an ongoing partial response to the WT-1 TCR. The clinical activity appeared to correlate with the pharmacokinetics of the engineered T cells, as the patient with the partial response had the best T cell expansion and persistence. JTCR016 was generally well-tolerated in these three refractory mesothelioma patients, with no evidence of sCRS or severe neurotoxicity.

Corporate News:
Celgene Corporation exercised its option to develop and commercialize CAR product candidates from Juno’s CD19 program outside of North America and China. With the exercise of this option, Celgene paid Juno a fee of $50.0 million and the companies will now generally share worldwide research and development expenses for CAR product candidates in the CD19 program. Celgene has commercial rights outside of North America and China, and will pay Juno a royalty at a percentage in the mid-teens on any future net sales in Celgene’s territories of CAR therapeutic products developed through the CD19 program. Juno retains commercialization rights in North America and China.

Juno entered into an exclusive license agreement with MSK and Eureka Therapeutics, Inc. for a novel, fully-human binding domain targeting B-cell maturation antigen (BCMA), along with antibodies against two additional undisclosed multiple myeloma targets to be used for the potential development and commercialization of CAR cell therapies for patients with multiple myeloma. MSK and Eureka Therapeutics are eligible to receive an undisclosed upfront payment, additional payments upon the achievement of undisclosed clinical, regulatory, and commercial milestones, and royalties on net sales. The parties expect the BCMA CAR to enter human testing as early as the first half of 2017.

Juno acquired RedoxTherapies, a privately held company. The acquisition provides Juno with an exclusive license to vipadenant, a small molecule adenosine A2a receptor antagonist that has the potential to disrupt important immunosuppressive pathways in the tumor microenvironment in certain cancers. Juno intends to explore this molecule in combination with its engineered T cell platform and may over time explore it in other areas as well. The upfront consideration for the RedoxTherapies acquisition was $10.0 million in cash. The seller is also eligible to receive payments upon the achievement of clinical, regulatory, and commercial milestones.

Second Quarter 2016 Financial Results
Cash Position: Cash, cash equivalents, and marketable securities as of June 30, 2016 were $1.11 billion compared to $1.13 billion as of March 31, 2016 and $1.22 billion as of December 31, 2015.

Cash Burn: Cash burn in the second quarter of 2016, excluding the $50.0 million opt-in fee from Celgene and cash inflows and outflows from business development, was $55.2 million. Including the cash inflow from Celgene of $50.0 million, and excluding cash inflows and outflows from business development activities, cash burn in the second quarter of 2016 was $5.2 million, compared to $18.5 million in the second quarter of 2015. Included in cash burn in the three months ended June 30, 2016 and 2015 are cash outflows for capital expenditures of $7.4 million and $6.8 million, respectively.

Revenue: Revenue for the three and six months ended June 30, 2016 was $27.6 million and $37.4 million, respectively, compared to $12.5 million for the three and six months ended June 30, 2015. The increase of $15.1 million and $24.9 million in the three and six months ended June 30, 2016, respectively, was due primarily to revenue recognized in connection with the Celgene collaboration and CD19 opt-in as well as milestone revenue from Novartis. Included in revenue for the three and six months ended June 30, 2015 was an upfront fee of $12.3 million received in connection with the Novartis sublicense agreement.

R&D Expenses: Research and development expenses for the three and six months ended June 30, 2016, inclusive of non-cash expenses and computed in accordance with GAAP, were $72.3 million and $146.0 million, respectively, compared to $60.2 million and $118.0 million for the same periods in 2015. The increases in 2016 were primarily due to increased costs incurred to execute Juno’s clinical development strategy, manufacture its product candidates, and expand its overall research and development capabilities, milestones achieved in 2016, and an increase in stock-based compensation expense. These increases were offset by upfront payments made to Fate Therapeutics and Editas in 2015, the gains recognized during the first two quarters of 2016 related to the change in the estimated value of Juno’s contingent consideration liabilities, and the difference between the periods in expense related to Juno’s estimated success payment liability. For the three months ended June 30, 2016 and 2015, Juno recorded expenses of $3.5 million and $4.0 million, respectively, related to Juno’s success payment liability. For the six months ended June 30, 2016, Juno recorded a gain of $3.1 million related to Juno’s success payment liability, compared to an expense of $42.9 million for the same period in 2015, resulting in a decrease of $46.0 million in research and development expense for the six months ended June 30, 2016.

Non-GAAP R&D Expenses: Non-GAAP research and development expenses for the three and six months ended June 30, 2016 were $72.1 million and $152.3 million, respectively, compared to $23.9 million and $40.9 million for the same periods in 2015. Non-GAAP research and development expenses for the three and six months ended June 30, 2016 include $8.9 million and $18.0 million of stock-based compensation expense, respectively, compared to $2.3 million and $4.1 million for the same periods in 2015. Non-GAAP research and development expenses in the first half of 2016 exclude the following:
An expense of $3.5 million for the three months ended June 30, 2016 and a gain of $3.1 million for the six months ended June 30, 2016 associated with the change in the estimated value and elapsed service period for Juno’s potential success payment liabilities to FHCRC and MSK.

Non-cash stock-based compensation expense of $1.2 million and $2.4 million for the three and six months ended June 30, 2016, respectively, related to a 2013 restricted stock award to a co-founding director that became a consultant upon his departure from Juno’s board of directors in 2014.

A gain of $4.5 million and $5.5 million for the three and six months ended June 30, 2016, respectively, associated with the change in the estimated fair value of the contingent consideration liabilities recorded in connection with the Stage and X-Body acquisitions.
Non-GAAP research and development expenses in the first half of 2015 exclude the following:
Expense of $4.0 million and $42.9 million for the three and six months ended June 30, 2015, respectively, associated with the change in estimated value and elapsed accrual period for Juno’s potential success payment liabilities to FHCRC and MSK.

Non-cash stock-based compensation expense of $1.7 million and $3.6 million for the three and six months ended June 30, 2015, respectively, related to a 2013 restricted stock award to a co-founding director that became a consultant upon his departure from Juno’s board of directors in 2014.

An expense of $0.1 million for the three and six months ended June 30, 2015, associated with the change in the estimated fair value of the contingent consideration liabilities recorded in connection with the Stage and X-Body acquisitions.

Upfront payments related to license agreements of $30.8 million for the three and six months ended June 30, 2015 associated with the Editas and Fate Therapeutics collaborations.

G&A Expenses: General and administrative expenses on a GAAP basis for the three and six months ended June 30, 2016 were $16.8 million and $32.8 million, respectively, compared to $20.2 million and $27.6 million for the same periods in 2015. The decrease in the second quarter of 2016 compared to the same period in 2015 was primarily due to lower litigation and business development costs, offset by increased personnel costs, including non-cash stock-based compensation expense, and increased consulting fees including costs related to commercial readiness. The increase in the first half of 2016 compared to the first half of 2015 was primarily due to increased personnel costs, including non-cash stock-based compensation expense, and consulting fees including costs related to commercial readiness, offset by lower litigation and business development expenses. General and administrative expenses include $5.5 million and $10.4 million of non-cash stock-based compensation expense for the three and six months ended June 30, 2016, respectively, compared to $3.0 million and $4.8 million for the same periods in 2015.

GAAP Net Loss: Net loss for the three and six months ended June 30, 2016 was $64.8 million, or $0.64 per share, and $135.9 million, or $1.35 per share, respectively, compared to $66.0 million, or $0.79 per share and $130.9 million, or $1.58 per share for the same periods in 2015.

Non-GAAP Net Loss: Non-GAAP net loss, which incorporates the non-GAAP R&D expense, for the three and six months ended June 30, 2016 was $64.6 million, or $0.64 per share and $142.1 million, or $1.40 per share, respectively, compared to $29.6 million, or $0.35 per share and $53.8 million, or $0.65 per share, respectively, for the same periods in 2015.
A reconciliation of GAAP net loss to non-GAAP net loss is presented below under "Non-GAAP Financial Measures."

2016 Financial Guidance
Juno reaffirms 2016 cash burn guidance, excluding cash inflows or outflows from business development activities, of between $220 million and $250 million.
Operating burn estimated to be between $170 million and $195 million.
Capital expenditures estimated to be between $40 million and $55 million, the vast majority of which are related to one-time infrastructure build-outs.

On August 4, 2016 Astellas Pharma Inc. (TSE: 4503, President and CEO: Yoshihiko Hatanaka, "Astellas") reported that Astellas’ US holding company, Astellas US Holding, Inc. ("Astellas US Holding"), has transferred its wholly owned manufacturing subsidiary Astellas Pharma Technologies, Inc. (Location: Norman, OK, USA, "APT") to Avara Norman Pharmaceutical Services, Inc. (Headquarters: Norwalk, CT, USA, "Avara") (Press release, Astellas, AUG 4, 2016, View Source [SID:1234514333]). Astellas Pharma Technologies, Inc. will be renamed Avara Pharmaceutical Technologies, Inc.

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"We sincerely thank the Astellas Pharma Technologies employees in Norman for their dedication over many years of service. In addition, I am very grateful for the way they have kept our operation running smoothly through the last months of uncertainty as we searched for the right buyer — and we wish them the best as they transition to Avara," said Mitsunori Matsuda, president of Technology at Astellas. "We have confidence that Avara is the right company to oversee the continuing supply of the Astellas products that are made at the facility, as well as the fulfillment of capacity use at and capabilities of the facility. We look forward to working with Avara as the new owner of the facility to ensure the continuous supply of our products for the patients who need them."

Astellas is engaged in ongoing efforts to create organizations and systems that can flexibly respond to rapidly changing environments and work toward higher quality and efficiency of operations. In the areas of manufacturing and technology, Astellas strives to promote the establishment of a stable manufacturing system that will efficiently realize the steady supply of high-quality drugs through the effective use of external resources and the strengthening of Astellas’ own internal functions. As a part of these efforts, Astellas has transferred APT, which owns the plant used for the formulation and packaging of certain Astellas pharmaceutical products, to Avara.

Under the terms of the transaction, APT employees will remain employed at the site, and the plant will continue to manufacture certain Astellas products on a contract basis.

Astellas expects to continue to source a stable supply of high-quality products from the facility under the oversight of Avara.

Deloitte Corporate Finance served as financial advisor to Astellas in connection with the transaction.

1. Financial terms of this deal Financial terms including the value of this acquisition are not disclosed.

2. Outline of APT and the Norman Plant
Astellas Pharma Technologies, Inc.
Location : Norman, OK, USA
Representative : Brian McLellan, President
Capital : 100% owned by US holding company, Astellas US Holding, Inc.
Business description : Manufacturing of pharmaceutical products

Norman Plant
Site area : Approx.810,000 m2
Building area : Approx.29,000 m2
Total number of employees : Approx.200 (as of June 2016）

3. Outline of Transferee
Company name : Avara Norman Pharmaceutical Services, Inc.
Head office : Norwalk, CT, USA
Representative : Timothy C. Tyson, Chairman, Chief Executive Officer
Capital : Avara US Holdings, Ltd. 100%
Business description : Contract manufacturing of pharmaceutical products

In line with the transfer of APT, Astellas expects approximately ¥9.0 billion of one-time expenses including impairment loss of plant and equipment, among others, for the second quarter ending September 30, 2016. Astellas doesn’t revise the full-year consolidated business forecasts for FY2016 (April 1, 2016 to March 31, 2017) announced in May 2016.

On August 4, 2016 ImmunoGen, Inc. (Nasdaq: IMGN), a leader in the expanding field of antibody-drug conjugates (ADCs) for the treatment of cancer, reported an update on the Company’s progress and reported financial results for its fourth quarter and fiscal year ended June 30, 2016 (Press release, ImmunoGen, AUG 4, 2016, View Source [SID:1234514243]).

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"With our lead candidate poised to enter Phase 3 and a portfolio of well-differentiated programs advancing behind it, I am excited to have joined the strong team managing ImmunoGen’s transition to a fully-integrated biotech company," stated Mark Enyedy, President and CEO. "We will build upon ImmunoGen’s leadership position in ADCs by focusing on four strategic priorities: complete development and commercialize mirvetuximab soravtansine, accelerate our earlier-stage portfolio, continue to drive innovation in ADCs for the treatment of cancer, and support new and existing partnerships. As we execute on these priorities, we will look to improve the efficiency of our operations and more effectively manage our cash position."

Mr. Enyedy continued, "We made significant progress on these priorities over the past three months, including meeting with the FDA to review the path to registration for mirvetuximab soravtansine and our proposed Phase 3 trial, FORWARD I. With the benefit of the guidance provided by the agency, we are moving ahead with the study as designed and expect to enroll our first patient before year end. Following successful dose escalation, we have also initiated a 35-patient, Phase 2 expansion cohort for mirvetuximab soravtansine in combination with Avastin as part of our FORWARD II trial. With the initiation of Phase 1 dose escalation for IMGN779 and the progression of IMGN632 into pre-IND testing, we continue to advance our earlier-stage candidates deploying our new IGN payload technology to broaden the range of ADC-treatable cancers. The progress with our product candidates and those of our partners demonstrates ImmunoGen’s continuing commitment to drive ADC innovation to improve the lives of patients with cancer."

Pipeline Updates

Mirvetuximab Soravtansine

Mirvetuximab soravtansine is a well-differentiated experimental therapy for the treatment of ovarian cancer and potentially other tumor types that express its target, folate receptor alpha (FRα). This ADC is being evaluated in clinical trials as a single-agent therapy for platinum-resistant ovarian cancer and in combination regimens for both platinum-resistant and platinum-sensitive disease.

Single-Agent Therapy

Held Type B meeting with the U.S. Food and Drug Administration (FDA) to review the path to registration for mirvetuximab soravtansine and the proposed FORWARD I study protocol. With the benefit of the agency’s guidance, ImmunoGen is moving forward with initiating this Phase 3 trial as previously outlined, including with the primary endpoint of progression-free survival (PFS).
Reported data from 46 patients with FRα-positive platinum-resistant ovarian cancer at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) meeting in June. Mirvetuximab soravtansine demonstrated robust single-agent activity in these patients, with the greatest response rates and PFS reported in patients with high or medium levels of FRα expression on their tumors and who had received up to three prior regimens, the patient population eligible for enrollment in FORWARD I.
Strategic Combination Regimens

Initiated the 35-patient Phase 2 assessment in FORWARD II of mirvetuximab soravtansine in combination with Avastin following successful completion of dose finding.
Continued enrollment in the FORWARD II cohorts assessing the ADC used with pegylated liposomal doxorubicin (PLD) and, separately, with carboplatin, with the cohort assessing the combination with Keytruda on track to open this summer.
Exploring Additional Opportunities

Through ImmunoGen’s collaboration with the National Comprehensive Cancer Network (NCCN), grants were awarded for clinical assessment of mirvetuximab soravtansine in combination with gemcitabine and as a treatment of triple negative breast cancer as well as for preclinical studies on mechanisms of resistance, sensitivity, and biomarkers.
IMGN779 / IMGN632

IMGN779 and IMGN632 deploy ImmunoGen’s new ultra-potent, DNA-acting payload agents that alkylate DNA without crosslinking it. In preclinical studies, these agents have been found to avoid the sustained toxicity seen with DNA-crosslinking agents.

Initiated Phase 1 clinical testing of IMGN779, a CD33-targeting ADC, for the treatment of AML. Initial clinical data from this trial are expected to be presented in 2017.
Advanced CD123-targeting IMGN632 into IND-enabling testing. The first preclinical findings with this novel ADC were presented at the European Hematology Association (EHA) (Free EHA Whitepaper) annual meeting, with additional data on its distinctive activity and tolerability expected to be presented in late 2016.
IMGN529

IMGN529 deploys ImmunoGen’s validated maytansinoid payload technology and recently gained orphan drug status in diffuse large B-cell lymphoma (DLBCL).

Initiated Phase 2 clinical testing of IMGN529 used in combination with Rituxan for patients with B-cell malignancies including DLBCL based on marked synergy in preclinical testing.
Fiscal Year 2016 Financial Results

ImmunoGen’s fiscal year 2016 ended June 30, 2016. The Company is moving to reporting on a calendar year basis, effective January 1, 2017.

For the Company’s fiscal year ended June 30, 2016 (FY2016), ImmunoGen reported a net loss of $143.7 million, or $1.65 per basic and diluted share, compared to a net loss of $60.7 million, or $0.71 per basic and diluted share, for its fiscal year ended June 30, 2015 (FY2015). For the quarter ending June 30, 2016, ImmunoGen reported a net loss of $44.8 million, or $0.51 per basic and diluted share, compared to a net loss of $30.5 million, or $0.35 per basic and diluted share, for the same quarter in FY2015.

Revenues in FY2016 were $60.0 million, compared to $85.5 million in FY2015, with the decrease principally due to reduced non-cash revenue from the amortization of upfront fees. FY2016 revenues include $26.9 million of license and milestone fees compared to $57.8 million in FY2015. The current period includes less revenue from the amortization of previously-received upfront fees than the prior period, $8.6 million and $41.4 million, respectively, and more revenue from partner milestone payments, $18.0 million and $14.0 million, respectively. Revenues in FY2016 also include $25.5 million of royalty revenues, all but $200,000 of which was non-cash, compared with $19.4 million for FY2015, of which $5.5 million was non-cash and $13.9 million was cash. Revenues for FY2016 also include $4.0 million of research and development support fees and $3.6 million of clinical materials revenue, compared with $2.8 million and $5.5 million, respectively, in such fees for FY2015. The changes reflect variations in the level of research support and the number of batches of clinical materials produced and released to partners on a year-to-year basis.

Operating expenses in FY2016 were $183.8 million, compared to $140.0 million in FY2015, with the increase principally due to costs associated with ImmunoGen advancing mirvetuximab soravtansine and other innovative, wholly-owned product candidates. Research and development expenses were $146.9 million in FY2016, compared to $111.8 million in FY2015. The increase in FY2016 is primarily due to increased clinical trial costs, particularly related to mirvetuximab soravtansine, to greater third-party costs related to ImmunoGen product program advancement, and to increased personnel expenses, principally due to hiring in the first three quarters of FY2016. General and administrative expenses were $36.9 million in FY2016, compared to $28.2 million in FY2015. This increase is primarily due to increased personnel expenses, particularly higher non-cash stock compensation costs which include a substantial charge resulting from the CEO transition, and to a lesser extent, increased third-party service fees.

ImmunoGen had approximately $245.0 million in cash and cash equivalents and $100.0 million of convertible debt outstanding as of June 30, 2016, compared with $278.1 million of cash and cash equivalents and no debt on June 30, 2015. Cash used in operations was $124.5 million in FY2016, compared with $55.3 million in FY2015. Capital expenditures were $10.4 million and $7.4 million for FY2016 and FY2015, respectively.

Financial Guidance

ImmunoGen is transitioning to a fiscal year ending December 31, effective January 1, 2017. For the six months ending December 31, 2016, ImmunoGen expects: revenues to be between $40 million and $45 million; operating expenses to be between $95 million and $100 million; net loss to be between $55 million and $60 million; cash used in operations to be between $65 million and $70 million; and capital expenditures to be between $2 million and $5 million. Cash and marketable securities at December 31, 2016 are anticipated to be between $170 million and $175 million.

On August 4, 2016 ZIOPHARM Oncology, Inc. (Nasdaq:ZIOP), a biopharmaceutical company focused on new immunotherapies, reported the publication of data highlighting the benefits of using the non-viral Sleeping Beauty (SB) system to genetically modify T-cells to express a chimeric antigen receptor (CAR) for use against leukemias and lymphomas (Press release, Ziopharm, AUG 4, 2016, View Source [SID:1234514282]). The article, titled "Phase I trials using Sleeping Beauty to generate CD19-specific CAR T cells," was published in the Journal of Clinical Investigation (doi:10.1172/JCI86721), and is available online here.

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In the paper, 26 patients with multiply relapsed B-lineage acute lymphoblastic leukemia (ALL, n=17) or B-cell non-Hodgkin lymphoma, (NHL, n=9) were enrolled in two investigator-initiated clinical trials at the University of Texas MD Anderson Cancer Center infusing SB-modified T cells after autologous (n=7) or allogeneic (n=19) hematopoietic stem-cell transplantation (HSCT).

Autologous CAR-T: Seven patients with advanced NHL were treated with autologous HSCT followed by administration of patient-derived CAR T cells. Six of the seven patients remain in complete remission (CR) and the 30-month progression-free survival (PFS) and overall survival (OS) rates were 83.3% and 100%, respectively.
Allogeneic CAR-T: Nineteen patients (ALL n=17, NHL n=2) received donor-derived CAR T cells. The patients had advanced disease at the time of HSCT and CAR T cells were administered without additional lymphodepletion. Eleven of 19 patients remain in remission with 1-year PFS and OS rates of 53% and 63%, respectively.
HLA partially-matched allogeneic CAR-T: When the subset of allogeneic recipients of HSCT receiving haplo-identical CAR T cells were examined, eight patients had 1-year PFS and OS rates of 75% and 100%, respectively.
SB-mediated gene transfer and stimulation resulted in large ex vivo expansion of T cells while retaining CAR expression and without integration hotspots. Autologous and allogeneic T cells survived after infusion an average of 201 and 51 days, respectively. No unexpected acute infusion or delayed toxicities were noted in the autologous or allogeneic recipients. Mild elevations in cytokines were observed without cytokine storm.

Francois Lebel, M.D., Executive Vice President, Research and Development, Chief Medical Officer at ZIOPHARM, states: "By following these patients over an extended duration, as we do in these studies, we can better understand the added benefit of CAR-T over HSCT alone. Although the primary objective of these trials was not to establish efficacy, the recipients’ outcomes are encouraging with apparent doubling of survivals compared to historical controls. We are encouraged by these clinical data and look forward to results from our Phase 1 study infusing our next generation CD19-specific CAR T cells in patients with advanced lymphoid malignancies."

Supported by results from two Phase I clinical studies conducted by investigators at MD Anderson Cancer Center, the publication describes how the use of the SB transposon/transposase platform could reduce the costs and complexity associated with recombinant viral vector-based immunotherapy. Additionally, by infusing a CD19-specific CAR T cells to target minimal residual disease after autologous and allogeneic HSCT, the SB system may improve tolerability by avoiding cytokine storm.

"The use of the non-viral Sleeping Beauty platform provides us with leverage to both decrease the cost of modifying T cells and reduce the T-cell manufacturing steps requiring GMP," said Laurence Cooper, M.D., Ph.D., Chief Executive Officer of ZIOPHARM. "As we continue to advance Sleeping Beauty engineered designs, ZIOPHARM benefits from both viral and non-viral approaches within CAR-T, while focusing efforts on non-viral gene delivery for TCR given its unique ability to enable personalized therapies for patients with solid tumors."

On August 4, 2016 Insmed Incorporated (Nasdaq:INSM), a global biopharmaceutical company focused on the unmet needs of patients with rare diseases, reported financial results for the quarter ended June 30, 2016 (Press release, Insmed, AUG 4, 2016, View Source [SID:1234514245]).

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Business Update

Global phase 3 CONVERT study advancing on track. The company continues to expect patient enrollment in its phase 3 study of ARIKAYCE (liposomal amikacin for inhalation) to conclude in 2016. The study, which is known as CONVERT or INS-212, is evaluating ARIKAYCE in nontuberculous mycobacteria (NTM) lung disease caused by Mycobacterium avium complex (MAC). CONVERT is taking place in 18 countries and involves more than 145 sites. The primary efficacy endpoint is the proportion of subjects who achieve culture conversion at Month 6 in the ARIKAYCE plus multi-drug regimen arm compared to the multi-drug regimen without ARIKAYCE arm.
Data from phase 2 study of ARIKAYCE presented at the 1st World Bronchiectasis Conference. One-year follow-up data from the company’s phase 2 study of ARIKAYCE in patients with NTM lung disease were recently presented at the 1st World Bronchiectasis Conference in Hannover, Germany. The presentation was one of nine abstracts accepted for oral presentation.
Data from phase 1 clinical study of INS1009 to be presented at ERS 2016. Two abstracts have been accepted for presentation at the European Respiratory Society (ERS) International Congress taking place in London September 3-7. The posters are titled "Single dose pharmacokinetics of C16TR for Inhalation (INS1009) vs. treprostinil inhalation solution" and "Safety and pharmacokinetics study of a single ascending dose of C16TR for inhalation (INS1009)". The presentations will take place on Monday September 5. INS1009 is one of the company’s nebulized treprostinil prodrugs, which may offer a differentiated product profile with therapeutic potential in rare pulmonary disorders such as pulmonary arterial hypertension (PAH), idiopathic pulmonary fibrosis (IPF), pulmonary sarcoidosis, and severe refractory asthma.
US Patent strengthens global patent portfolio. The United States Patent and Trademark Office issued patent no. 9,402,845, which provides methods of treating pulmonary infections via inhalation administration of a formulation containing a liposomal quinolone antibiotic and free quinolone antibiotic, such as ciprofloxacin. For example, a method of treating a bronchiectasis patient for a Pseudomonas aeruginosa pulmonary infection with the formulation is provided. The patent complements ARIKAYCE’s global intellectual property estate and further solidifies Insmed’s position as an innovator of liposomal antibiotic technology for pulmonary disorders and infections.
"Our phase 3 CONVERT study is our top corporate priority and we anticipate concluding enrollment later this year," said Will Lewis, president and chief executive officer of Insmed. "Positive data from CONVERT are expected to support a broad global regulatory strategy and advance our goal of bringing ARIKAYCE to patients with NTM lung disease who are in great need of new therapeutic options."

Second Quarter Financial Results

For the second quarter of 2016, Insmed posted a net loss of $36.6 million, or $0.59 per share, compared with a net loss of $28.6 million, or $0.47 per share, for the second quarter of 2015.

Research and development expenses were $23.9 million for the second quarter of 2016, compared with $18.2 million for the second quarter of 2015. The increase was primarily due to the advancement of the company’s global phase 3 CONVERT study of ARIKAYCE in NTM lung disease.

General and administrative expenses for the second quarter of 2016 were $12.3 million, compared with $9.7 million for the second quarter of 2015. The increase was primarily related to pre-commercial activities, namely the buildout of the company’s infrastructure and NTM disease awareness activities, as well as an increase in headcount and related expenses.

Balance Sheet Highlights and Cash Guidance

"Observing the market changes from the beginning of the year, we are closely managing our operations resulting in cash operating expenses at the low end of our guidance for the first half of the year," said Andy Drechsler, chief financial officer of Insmed. "We continue to ensure that mission-critical priorities, such as the phase 3 CONVERT study and other key pre-commercial activities, are fully resourced. Given our solid cash position and disciplined approached to capital allocation, we expect to execute on our operational and strategic priorities."

As of June 30, 2016, Insmed had cash and cash equivalents of $223 million. Excluding depreciation and stock-based compensation expense, the company’s cash operating expenses for the six months ended June 30, 2016 were $59 million, which was at the low end of the company’s previously guided range of $58 to $68 million. Insmed ended the second quarter of 2016 with $25 million in debt and $197 million of working capital.

The company is investing in the following activities in 2016: (i) clinical development of ARIKAYCE, (ii) regulatory and pre-commercial initiatives for ARIKAYCE, and (iii) preclinical and clinical activities for its earlier-stage pipeline. Insmed expects its cash-based operating expenses for the second half of 2016 to be in the range of $62 to $72 million.