On August 4, 2021 SpringWorks Therapeutics, Inc. (Nasdaq: SWTX), a clinical-stage biopharmaceutical company focused on developing life-changing medicines for patients with severe rare diseases and cancer, reported financial results for the second quarter and year-to-date periods ended June 30, 2021 and provided an update on recent company developments (Press release, SpringWorks Therapeutics, AUG 4, 2021, View Source [SID1234585726]).

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"We are very pleased with our execution in the second quarter of 2021, which included continuing to advance our strategy to evaluate nirogacestat as a BCMA potentiator across modalities, building upon our intellectual property portfolio by extending the patent protection for mirdametinib into 2041, and expanding our targeted oncology pipeline through collaborations with leading cancer centers as well as the in-license of a TEAD inhibitor portfolio," said Saqib Islam, Chief Executive Officer of SpringWorks. "In the second half of the year we expect important data readouts across our late-stage rare oncology, BCMA combinations in multiple myeloma and metastatic solid tumor programs, including topline data from our Phase 3 DeFi study. In parallel, we will continue to advance our 15 development programs on behalf of oncology patients."

Recent Business Highlights and Upcoming Milestones

Late-Stage Rare Oncology

SpringWorks expects to report topline data from the Phase 3 DeFi trial evaluating nirogacestat in adult patients with progressing desmoid tumors in the second half of 2021, as previously disclosed.
Recruitment is ongoing in a Phase 2 study sponsored by the Children’s Oncology Group evaluating nirogacestat in pediatric patients with desmoid tumors.
Updated interim data from the adult stratum of the ongoing potentially registrational Phase 2b ReNeu trial evaluating mirdametinib in pediatric and adult patients with NF1-associated plexiform neurofibromas were presented at the 2021 Children’s Tumor Foundation NF Conference in June 2021. These updated data were based on a cut-off date of March 23, 2021 and showed durable efficacy in the same 20 patients reported in February 2021, with the median time on treatment now having reached 13 cycles (approximately 12 months); the objective response rate remained at 50%, and 80% of these patients remained on study at the data cutoff. In addition, mirdametinib remained generally well tolerated; the majority of treatment-related adverse events (TRAE) in these patients were Grade 1 or 2, with only one Grade 3 TRAE observed and no Grade 4 or 5 adverse events (AE) reported in these 20 patients as of the data cutoff. The Company expects to complete enrollment of the trial in the second half of 2021.
In June 2021, SpringWorks entered into a collaboration to conduct a Phase 1/2 clinical trial evaluating mirdametinib in children and young adults with low-grade glioma. Patients are being dosed in this study, which is sponsored by St. Jude Children’s Research Hospital.
B-cell Maturation Antigen (BCMA) Combinations in Multiple Myeloma

In June 2021, SpringWorks entered into a clinical trial collaboration agreement with Seagen Inc. to evaluate nirogacestat in combination with SEA-BCMA, Seagen’s investigational monoclonal antibody targeting B-cell maturation antigen (BCMA) in patients with relapsed or refractory multiple myeloma.
Enrollment is ongoing in four clinical trials evaluating nirogacestat in combination with BCMA therapies in adult patients with relapsed or refractory multiple myeloma: a Phase 1b trial sponsored by GSK evaluating nirogacestat in combination with BLENREP (belantamab mafodotin-blmf), a Phase 1 study sponsored by Allogene evaluating nirogacestat in combination with ALLO-715, a Phase 1 study sponsored by Janssen evaluating nirogacestat in combination with teclistamab, and a Phase 1/2a study sponsored by Precision BioSciences evaluating nirogacestat in combination with PBCAR269A. Initial data from the GSK-sponsored study are expected in 2021. SpringWorks also expects that two additional collaborator-sponsored trials will initiate enrollment in the second half of 2021, as previously disclosed: nirogacestat + Pfizer’s elranatamab and nirogacestat + Seagen’s SEA-BCMA.
Biomarker-Defined Metastatic Solid Tumors

In May 2021, SpringWorks entered into an exclusive worldwide license agreement with Katholieke Universiteit Leuven (KU Leuven) and the Flanders Institute for Biotechnology (VIB) for the in-license of a portfolio of novel small molecule inhibitors of the TEAD family of transcription factors, designed for the potential treatment of biomarker-defined solid tumors driven by aberrant Hippo pathway signaling. The licensed portfolio includes advanced lead compounds and multiple backup compounds from diverse chemical series, which were discovered at KU Leuven’s Center for Drug Design and Discovery (CD3) in collaboration with Professor Georg Halder of the VIB-KU Leuven Center for Cancer Biology. SpringWorks expects to nominate a development candidate from this portfolio and commence IND-enabling studies in 2022.
Enrollment is ongoing in a Phase 1b/2 trial evaluating mirdametinib with BeiGene’s RAF dimer inhibitor, lifirafenib, in adult patients with RAS/RAF mutant and other MAPK pathway aberrant solid tumors. Initial clinical data from the BeiGene-sponsored trial are expected in 2021, as previously disclosed.
Enrollment is ongoing in a Phase 1 trial of BGB-3245 in adult patients with RAF mutant solid tumors. BGB-3245 is a selective RAF dimer inhibitor being developed by MapKure, LLC, a joint venture between SpringWorks and BeiGene. Initial clinical data from the MapKure-sponsored trial are expected in 2021, as previously disclosed.
In August 2021, SpringWorks announced a platform study sponsored by Memorial Sloan Kettering Cancer Center to evaluate mirdametinib both as a monotherapy and as a combination therapy in advanced solid tumors harboring selected MAPK-activating mutations. This trial is planned to initially explore mirdametinib in two patient cohorts: the first in combination with fulvestrant, a selective estrogen receptor degrader, in patients with estrogen receptor-positive metastatic breast cancer with MAPK alterations (particularly inactivating mutations in NF1) and the second as a monotherapy in advanced solid tumors harboring oncogenic MEK1 or MEK2 mutations.
In May 2021, SpringWorks entered into a research collaboration with the University of Zurich to further explore the activity of mirdametinib and lifirafenib combination therapy in preclinical patient-derived NRAS-mutant solid tumors models. The research, which is being led by Reinhard Dummer, M.D., builds upon previous translational work presented by SpringWorks and BeiGene and is intended to support ongoing and future patient selection strategies and to further define the competitive differentiation of the MAPK pathway vertical inhibition strategy supported by the combination of mirdametinib and lifirafenib.
General Corporate

In July 2021, the United States Patent and Trademark Office issued a new composition of matter patent that covers the polymorphic form of mirdametinib that is currently in clinical development. This patent expires in 2041.
SpringWorks appointed Mike Burgess, M.B.Ch.B., Ph.D. as Head of Research and Development and Jim Cassidy, M.D., Ph.D. as Chief Medical Officer. Drs. Burgess and Cassidy each bring decades of experience in oncology drug discovery and development as physician-scientists and R&D leaders at leading biotech and pharmaceutical companies.
Second Quarter 2021 Financial Results

Research and Development (R&D) Expenses: R&D expenses were $32.1 million for the second quarter, compared to $12.9 million for the comparable period of 2020. The increases in R&D expenses were primarily attributable to a nonrefundable upfront payment to KU Leuven and VIB for the in-licensing of the TEAD inhibitor program, an increase in external costs related to drug manufacturing and trial costs, and an increase in internal costs driven by the growth in employee costs associated with increases in the number of R&D personnel and an increase in stock-based compensation expense.
General and Administrative (G&A) Expenses: G&A expenses were $14.9 million for the second quarter, compared to $6.9 million for the comparable period of 2020. The increases in G&A expenses were primarily attributable to the hiring of additional personnel in G&A functions supporting the growth of the organization, as well as an increase in stock-based compensation expense.
Net Loss Attributable to Common Stockholders: SpringWorks reported net loss of $47.0 million, or $0.97 per share, for the second quarter of 2021. This compares to a net loss of $19.9 million, or $0.47 per share, for the comparable period of 2020.
Cash Position: Cash, cash equivalents and marketable securities were $507.5 million as of June 30, 2021.
COVID-19 Update

To date, the COVID-19 pandemic has had a relatively modest impact on SpringWorks’ business operations, in particular on SpringWorks’ clinical trial programs, and SpringWorks is undertaking considerable efforts to mitigate the various challenges presented by this crisis. For further details and descriptions of the risks associated with the COVID-19 pandemic, please see the Risk Factors in SpringWorks’ periodic filings with the Securities and Exchange Commission and refer to the Forward-Looking Statements section in this press release.

On August 4, 2021 PanTher Therapeutics (PanTher), a privately held oncology company revolutionizing the treatment of solid tumors with its proprietary treatment platform designed for direct, localized, and sustained delivery of proven and novel therapeutic agents, reported that it received approval from the Human Research Ethics Committee (HREC) to open a Phase 1 clinical trial of PTM-101 in Australia (Press release, PanTher Therapeutics, AUG 4, 2021, View Source [SID1234585742]). PTM-101 is being developed for the treatment of pancreatic cancer.

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"Pancreatic tumors are notoriously difficult to treat, which is why pancreatic cancer has the highest mortality rate of all major cancers with a 5-year relative survival rate of just 10%," said Laura Indolfi, CEO and Co-Founder of PanTher Therapeutics. "Approval for this first-in-human trial of our lead candidate, PTM-101, brings us one step closer in our journey to deliver effective treatments for the deadliest, most difficult-to-treat cancers."

The company also announced today the appointment of J. Marc Pipas, MD, as Chief Medical Officer and the establishment of its clinical advisory board, composed of key opinion leaders with specific expertise in pancreatic cancer and other solid tumors. Dr. Pipas, a veteran gastrointestinal (GI) oncologist and clinical trialist who has assisted in the development of multiple oncology agents from Phase 1 trials through commercialization, will direct PanTher’s clinical development programs.

Dr. Pipas is a graduate of SUNY-Health Science Center at Syracuse, and completed his Residency at the Medical University of South Carolina, followed by a Fellowship in Medical Oncology at Dartmouth. He spent more than 20 years at Dartmouth Medical School and Dartmouth-Hitchcock Medical Center, where he was promoted to Full Professor and served as Director of the GI Oncology Program, and Interdisciplinary Pancreas Cancer Clinic. He also spent several years as Director of the Office of Clinical Research at the Norris Cotton Cancer Center, a National Cancer Institute-designated Comprehensive Cancer Center, and Director of the Hematology-Oncology Fellowship program.

Following his academic career, Dr. Pipas joined Merrimack Pharmaceuticals as Vice President, Medical Director, where he was involved in program development of ONIVYDE, which received approval from the U.S. Food and Drug Administration for pancreatic cancer and was subsequently sold to Ipsen Pharmaceuticals for $1 billion. Dr. Pipas also served as Executive Medical Director, Clinical Development, for H3 Biomedicine, a subsidiary of Eisai Pharmaceuticals, where he focused his energies on Phase 1 Oncology drug trials in GI and breast cancer.

"PanTher’s unique approach to tackling difficult-to-treat deadly cancers has the potential to change the way oncologists approach patients with solid tumors," said Dr. Pipas. "I am excited to join PanTher at this important moment in the company’s development and look forward to working with the team to capitalize on the strong preclinical data and advance this potentially life-saving platform."

"Dr. Pipas has dedicated his career to bringing new therapies to the clinic, and we are thrilled to have him join the PanTher team," said Indolfi. "He brings a deep commitment to patients that fully aligns with our mission to empower oncologists to treat patients with life-threatening cancers by unlocking a drug’s full potential through targeted treatment at the tumor site."

Dr. Pipas will also chair PanTher’s newly established clinical advisory board, which will play an active role in guiding the company’s long-term strategy and pipeline development. He will be joined by four prominent key opinion leaders with extensive experience in GI oncology:

Thomas E. Clancy, MD, FACS, is co-director of the Pancreas and Biliary Tumor Center and Medical Director of Multispecialty Surgical Oncology at the Dana-Farber/Brigham and Women’s Cancer Center in Boston. His clinical interests include GI malignancies, pancreatic and liver tumors, and minimally invasive surgery. Dr. Clancy is also an Assistant Professor of Surgery at Harvard Medical School, where he received his Doctor of Medicine.
Jason Fleming, MD, is chair of the Department of Gastrointestinal Oncology at Moffitt Cancer Center in Tampa, Florida. Dr. Fleming’s previous roles include Chief of Pancreas Surgery and Professor with tenure in the Department of Surgical Oncology at the University of Texas MD Anderson Cancer Center and scientific and medical advisory board member for the Pancreatic Cancer Action Network (PanCAN). Dr. Fleming has received several notable honors for his work, including the President’s Faculty Recognition Award for Outstanding Contribution to the University of Texas MD Anderson Cancer Center.
Timothy B. Gardner, MD, is Director of the Gastroenterology & Hepatology Fellowship Program and Director of Pancreatic Disorders at Dartmouth-Hitchcock Medical Center. He is also Medical Director of the Islet Cell Transplant Program and is associate professor of medicine at Dartmouth’s Geisel School of Medicine. He specializes in gastroenterology and hepatology with particular focus in endoscopic retrograde cholangiopancreatography (ERCP), endoscopic ultrasound, liver disease, malabsorptive disease, and pancreatic disease.
Theodore (Ted) Sunki Hong, MD, is an accomplished physician-scientist at Massachusetts General Hospital in Boston, where he serves as Director of Gastrointestinal Radiation Oncology and Co-Director of the Tucker Gosnell Center for Gastrointestinal Cancers. In addition to practicing medicine, Dr. Hong conducts research involving targeted therapies for the treatment of GI cancers.

On August 4, 2021 CohBar, Inc. (NASDAQ: CWBR), a clinical stage biotechnology company developing mitochondria based therapeutics to treat chronic diseases and extend healthy lifespan, reported that the company will release its second quarter 2021 financial results after the market closes on Tuesday, August 10, 2021 (Press release, CohBar, AUG 4, 2021, View Source [SID1234585926]). Management will host a conference call with a slide presentation at 5:00 p.m. ET (2:00 p.m. PT) on the same day to provide an update on the company’s business.

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Details for the Conference Call and Slide Presentation:

Please visit View Source and enter password CWBR, or
Go to www.cohbar.com and click on CohBar Q2 2021 Investor Presentation at the top of homepage.
For individuals participating in the Investor Call and Slide Presentation, please call into the conference audio and log into Zoom approximately 10 minutes prior to its start. Please note, no audio will be available through Zoom.

An audio replay of the call will be available beginning at 8:00 p.m. Eastern Time on August 10, 2021, through 11:59 p.m. Eastern Time on August 31, 2021. To access the recording please dial (844) 512-2921 in the U.S. and Canada, or (412) 317-6671 internationally, and reference Conference ID# 10159293. The audio recording along with the slide presentation will also be available at www.cohbar.com during the same period.

On August 4, 2021 Xencor, Inc. (NASDAQ:XNCR), a clinical-stage biopharmaceutical company developing engineered monoclonal antibodies and cytokines for the treatment of cancer and autoimmune diseases, reported financial results for the second quarter ended June 30, 2021 and provided a review of recent business and portfolio highlights (Press release, Xencor, AUG 4, 2021, View Source [SID1234585711]).

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"Xencor is applying its leading protein engineering tools and XmAb technology to overcome historical challenges in creating therapeutic molecules from bispecific antibodies or cytokines. For our most advanced clinical programs, we recently initiated a Phase 2 clinical study for XmAb717, our PD-1 x CTLA-4 bispecific antibody, in metastatic prostate cancer, and we plan to initiate a Phase 2 study of plamotamab in lymphoma. Our cytokine portfolio is rapidly advancing with XmAb306, our long-acting IL-15 for oncology, and XmAb564, our IL-2 for autoimmune disease, both of which are in Phase 1 studies," said Bassil Dahiyat, Ph.D., president and chief executive officer at Xencor. "We are also at the forefront of efforts to engage CD28 to selectively activate T cells, and we plan to initiate clinical studies in 2022 for XmAb808, our B7-H3 x CD28 bispecific antibody, as well as our third clinical cytokine program, an IL-12-Fc candidate."

"Additionally, Vir Biotechnology and GSK’s sotrovimab was recently authorized for the treatment of mild-to-moderate COVID-19, becoming the third antibody incorporating XmAb technology to be made commercially available for patients. The licensing of our XmAb technologies expands their application to areas of medicine outside our internal focus and provides us with important sources of non-dilutive capital, which we use to advance and expand our broad internal portfolio of novel bispecific antibodies and cytokine drug candidates."

Recent Portfolio Highlights and Upcoming Data Presentations

XmAb717 (PD-1 x CTLA-4): A Phase 2 study was initiated for patients with metastatic castration-resistant prostate cancer. The study is evaluating XmAb717 as a monotherapy or in combination with other agents, depending on the tumor’s molecular subtype. Later this year, the Company anticipates initiating new studies of XmAb717 in additional tumor types and plans to announce additional data from the Phase 1 expansion cohorts for prostate cancer and renal cell carcinoma, as well as a cohort with multiple tumor types.
Plamotamab (CD20 x CD3): The Company plans to initiate a clinical study to investigate the chemotherapy-free triple combination of plamotamab, tafasitamab and lenalidomide in patients with relapsed or refractory diffuse large B cell lymphoma, an aggressive form of non-Hodgkin lymphoma, in late 2021 or early 2022. Plamotamab, which redirects T cells to tumors, and tafasitamab, a CD19-directed antibody, combine distinct immune pathways to generate a powerful anti-tumor effect and is a differentiated approach to treating patients with lymphomas. The Company plans to announce data from the ongoing Phase 1 study later this year.
Tidutamab (SSTR2 x CD3): A Phase 2 study was initiated for patients with Merkel cell carcinoma and small cell lung cancer, which are SSTR2-expressing tumor types known to be responsive to immunotherapy and are cancers with high unmet medical need. Later this year, the Company plans to announce updated data from the Phase 1 expansion cohort in patients with neuroendocrine tumor patients, including longer clinical follow-up and updated biomarker data.
XmAb564 (regulatory T cell selective IL-2-Fc): XmAb564 is a potency-reduced IL-2 cytokine engineered to selectively activate regulatory T cells for the treatment of autoimmune disease and is fused to an XmAb Fc domain for extended half-life. A Phase 1 single-ascending dose clinical trial was started in May to evaluate the safety, pharmacokinetics and biomarkers activity of a subcutaneous dose in healthy volunteers.
XmAb819 (ENPP3 x CD3): XmAb819 is engineered with reduced-potency CD3 binding as well as a multivalent 2+1 bispecific antibody format to enable greater tumor selectivity. XmAb819 is in development for patients with renal cell carcinoma, and the Company plans to submit an investigational new drug (IND) application in 2021 and initiate a Phase 1 study in early 2022.
Partnership Updates

Vir Biotechnology, Inc.: Sotrovimab (VIR-7831), an antibody that targets the SARS-CoV-2 virus, received emergency use authorization from the U.S. Food and Drug Administration for the treatment of mild-to-moderate COVID-19 in high-risk adults and pediatric patients, and is made available by Vir and its partner GlaxoSmithKline plc. Sotrovimab incorporates Xencor’s Xtend Fc technology for longer duration of action. VIR-7832, a second antibody licensed to Vir, which targets the SARS-CoV-2 virus in addition to incorporating Xtend technology and other XmAb Fc technologies, is currently enrolling patients to a Phase 1b/2a study.
Additional Partnering News: Xencor granted a license to Bristol Myers Squibb for its Xtend Fc technology to extend the half-life of a novel antibody combination therapy for SARS-CoV-2 infection, and the combination is currently in the NIH ACTIV-2 Phase 2/3 trial for infected patients. In addition, the Company received a development milestone from Novartis under the 2016 collaboration and license agreement related to IND-enabling activities for an undisclosed program using XmAb Fc technologies.
Second Quarter Ended June 30, 2021 Financial Results

Cash, cash equivalents and marketable investment securities totaled $603.7 million at June 30, 2021, compared to $604.0 million at December 31, 2020. Total proceeds from royalties, milestones, sale of an investment equity security, and a net increase in the value of marketable equity securities offset net spending of $90.5 million on operations for the first six months of 2021.

Total revenue for the second quarter ended June 30, 2021 was $67.4 million, compared to $13.1 million for the same period in 2020. Revenues in the second quarter were primarily related to revenue earned under the Company’s Janssen, Genentech and Novartis collaborations, and royalties from Alexion, Vir and MorphoSys, compared to revenues from the same period in 2020, which were primarily licensing revenue from Gilead and royalty revenue from Alexion. Total revenue for the six months ended June 30, 2021 was $101.4 million, compared to $45.5 million for the same period in 2020. Revenues for the six-month period in 2021 were primarily revenue earned from research collaborations with Janssen, Genentech and Novartis, milestone revenue from MorphoSys, and royalty revenue from Alexion, Vir and MorphoSys, compared to the same period in 2020, which were primarily licensing revenue from Gilead and Aimmune, milestone revenue from MorphoSys, and royalty revenue from Alexion.

Research and development (R&D) expenses for the second quarter ended June 30, 2021 were $49.5 million, compared to $43.5 million for the same period in 2020. Total R&D expenses for the six months ended June 30, 2021 were $90.9 million, compared to $77.4 million for the same period in 2020. Increased R&D expenses for the second quarter and first six months of 2021 over amounts for the same periods in 2020 were primarily due to additional spending on XmAb104 (PD-1 x ICOS) and XmAb819 development programs and other early-stage programs. Additional spending on XmAb306 also contributed to increased R&D expenses during the first six months of 2021.

General and administrative (G&A) expenses for the second quarter ended June 30, 2021 were $8.9 million, compared to $7.2 million for the same period in 2020. Total G&A expenses for the six months ended June 30, 2021 were $17.1 million, compared to $14.4 million for the same period in 2020. Increased G&A expenses for the second quarter and first six months of 2021 over amounts for the same periods in 2020 were primarily due to increased G&A staffing and spending on professional services.

Other income for the second quarter ended June 30, 2021 was $43.2 million, compared to $2.6 million in the same period in 2020. Other income for the six months ended June 30, 2021 was $56.3 million, compared to $3.3 million in the same period in 2020. Other income for the second quarter and first six months of 2021 includes realized gains on the sale of an investment equity security and an increase in unrealized gains on the Company’s marketable equity investments.

Non-cash, stock-based compensation expense for the six months ended June 30, 2021 was $17.6 million, compared to $14.7 million for same period in 2020.

Net income for the second quarter ended June 30, 2021 was $52.2 million, or $0.87 on a fully diluted per share basis, compared to net loss of $35.0 million, or $(0.61) on a fully diluted per share basis, for the same period in 2020. For the six months ended June 30, 2021, net income was $49.8 million, or $0.82 on a fully diluted per share basis, compared to net loss of $43.1 million, or $(0.76) on a fully diluted per share basis, for the same period in 2020. Net income reported for the second quarter ended June 30, 2021 and first six months of 2021, compared to the net loss reported for the same periods in 2020, were primarily due to higher collaboration, milestone and royalty revenues and other income in 2021 compared to 2020.

The total shares outstanding were 58,315,485 as of June 30, 2021, compared to 57,214,253 as of June 30, 2020.

Financial Guidance

Based on current operating plans, Xencor expects to have cash to fund research and development programs and operations into 2024. Xencor expects to end 2021 with between $475 million and $500 million in cash, cash equivalents and marketable securities.

Conference Call and Webcast

Xencor will host a conference call today at 4:30 p.m. ET (1:30 p.m. PT) to discuss these second quarter 2021 financial results and provide a corporate update.

The live call may be accessed by dialing (877) 359-9508 for domestic callers or +1 (224) 357-2393 for international callers and referencing conference ID number 1389708. A live webcast of the conference call will be available online from the Investors section of Xencor’s website at View Source The webcast will be archived on Xencor’s website for 30 days.

On August 4, 2021 Horizon Therapeutics plc (Nasdaq: HZNP) reported record second-quarter 2021 financial results and increased both its full-year 2021 net sales and adjusted EBITDA guidance (Press release, Horizon Pharma, AUG 4, 2021, View Source [SID1234585727]).

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"Driving our record second-quarter performance was our highly successful TEPEZZA relaunch, which allowed Thyroid Eye Disease patients to rapidly access therapy and resulted in an increase in our full-year expectations," said Tim Walbert, chairman, president and chief executive officer, Horizon. "Our increased full-year net sales and adjusted EBITDA guidance represents strong double-digit year-over-year growth driven by TEPEZZA, KRYSTEXXA and our other rare disease medicines, where we are seeing continued strong underlying demand given the significant benefits our medicines provide to patients. We also initiated three clinical trials and acquired a biologics drug product manufacturing facility to support our strategy to maximize our key growth drivers, expand our pipeline and build a global presence. Horizon remains one of the fastest-growing biotechnology companies, underscoring our commitment to generate value for patients and our shareholders."

Second Quarter and Recent Company Highlights

Strong TEPEZZA Relaunch Exceeded Expectations: In April, the Company resumed supplying the market with TEPEZZA following a supply disruption that began in December 2020 due to U.S.-government-mandated COVID-19 vaccine orders. Second-quarter net sales of $453.3 million exceeded expectations, and today, the Company increased its TEPEZZA full-year 2021 net sales guidance to greater than $1.550 billion from greater than $1.275 billion on continued strong new patient demand. In May, the Company resumed its unbranded television campaign and launched its first branded TEPEZZA television campaign, which is expected to drive broader reach and awareness of Thyroid Eye Disease (TED) and TEPEZZA, motivating patients to seek treatment more quickly.

Entered into Agreement with Arrowhead to Develop Next-Generation Gout Medicine: In June, the Company entered into an agreement with Arrowhead Pharmaceuticals Inc., for a discovery-stage investigational RNA interference (RNAi) therapeutic targeting xanthine dehydrogenase (XDH) as a potential treatment for people with uncontrolled gout. Gout is a serious and painful form of arthritis that is caused by excess serum uric acid in the blood and XDH represents a clinically validated target that is the primary source of serum uric acid. There are more than nine million gout patients in the United States, and a meaningful portion of the patients treated do not respond sufficiently to conventional therapies.

Acquired Biologics Manufacturing Facility in Waterford, Ireland: In July, the Company completed the acquisition of a biologics drug product manufacturing facility from EirGen Pharma in Waterford, Ireland. The Company intends to use the manufacturing facility to support the growth of the Company’s on-market medicines, including TEPEZZA, KRYSTEXXA and UPLIZNA (inebilizumab-cdon), as well as development-stage biologics.

New Chronic TED Data Published: Data published from two recent independent physician case studies of 40 chronic TED patients who showed benefit after treatment with TEPEZZA were published in Eye, the official journal for the Royal College of Ophthalmologists, and Orbit, the International Journal on Orbital Disorders, Oculoplastic and Lacrimal Surgery. These case studies add to the growing body of evidence supporting the use of TEPEZZA in chronic TED patients.

Initiated Enrollment in Three Clinical Trials:
In May, the first patient was enrolled in an open-label trial to evaluate KRYSTEXXA plus methotrexate in patients who were not complete responders to treatment with KRYSTEXXA monotherapy. Patients who were not complete responders to KRYSTEXXA monotherapy have limited options available to address their uncontrolled gout, which is gout refractory to conventional therapies.

In June, the first patient was enrolled in a Phase 2 randomized, placebo-controlled trial to evaluate HZN-7734 in patients with moderate to severe active systemic lupus erythematosus (SLE), a disease in which the body’s immune system attacks its own tissues and organs.

In July, the first patient was enrolled in a Phase 1 trial to evaluate HZN-1116 in patients with autoimmune diseases.

Hosting Virtual R&D Day in September for Investors and Analysts: The Company will host a virtual R&D Day on Sept. 29, featuring presentations from the Company’s R&D leadership team and key opinion leaders with a focus on the Company’s expanded pipeline.

Presented New UPLIZNA Data at Medical Meetings: The Company participated in several key medical meetings in the quarter, highlighting new UPLIZNA data. In April, new end-of-study data from the open-label extension period of the pivotal Phase 3 trial in patients with neuromyelitis optica spectrum disorder (NMOSD) were presented at the American Academy of Neurology’s 73rd Annual Meeting. The data demonstrated that UPLIZNA was generally well-tolerated for at least four years, and that long-term UPLIZNA treatment provided a sustained reduction in NMOSD attack risk from baseline, regardless of the time of treatment initiation. The Company also presented three oral sessions on UPLIZNA at the 7th Congress of the European Academy of Neurology (EAN) in June. Additionally, a new analysis of the pivotal Phase 3 trial demonstrating that the medicine consistently reduced the risk of worsening disability in people living with NMOSD was published in the May issue of Neurology Neuroimmunology & Neuroinflammation.

Received Multiple Best Workplace Awards: During the second quarter, the Company received four workplace recognitions reflecting the high engagement of its employees. In April, the Company was named one of Fortune’s "100 Best Companies to Work For" in the United States for the first time and was placed on Crain’s Chicago Business’ 2021 "Best Places to Work in Chicago" list for the sixth consecutive year. In May, Great Place to Work named the Company to the "Best Workplaces in Chicago" list for the fifth consecutive year. In July, Fortune and Great Place to Work named the Company to the "Best Workplaces for Millennials" list for the second consecutive year and the Company was the highest ranked biotechnology company on the list.
Key Clinical Development Programs

TEPEZZA, an insulin-like growth factor type 1 receptor (IGF-1R) antagonist monoclonal antibody.
Chronic TED Trial: Phase 4 randomized, placebo-controlled trial to evaluate TEPEZZA in chronic TED expected to initiate in the coming weeks.

Subcutaneous (SC) Administration: Phase 1 pharmacokinetic trial underway to explore SC administration of TEPEZZA.

Diffuse Cutaneous Systemic Sclerosis Exploratory Trial: Phase 1 exploratory trial to evaluate TEPEZZA in dcSSc expected to initiate in the third quarter of 2021.

KRYSTEXXA, a recombinant uricase enzyme that converts urate into a water-soluble liquid, allantoin, that can be easily excreted from the body.

MIRROR Randomized Controlled Trial: Phase 4 randomized, placebo-controlled trial underway to evaluate KRYSTEXXA plus methotrexate to increase the complete response rate in patients with uncontrolled gout.

PROTECT Trial: Phase 4 open-label trial underway to evaluate KRYSTEXXA to improve management of uncontrolled gout in kidney transplant patients.

Shorter Infusion Duration Trial: Phase 4 open-label trial underway to evaluate the impact of administering KRYSTEXXA plus methotrexate over a shorter infusion duration in patients with uncontrolled gout.

Monthly Dosing Trial: Phase 4 open-label trial underway to evaluate monthly dosing of KRYSTEXXA plus methotrexate in patients with uncontrolled gout.

Retreatment Trial: Phase 4 open-label trial initiated in May 2021 to evaluate KRYSTEXXA plus methotrexate in patients who were not complete responders to KRYSTEXXA monotherapy.

UPLIZNA, an anti-CD19 humanized monoclonal antibody that depletes B cells, including the pathogenic cells that produce autoantibodies.

Myasthenia Gravis Trial: Phase 3 randomized, placebo-controlled trial underway to evaluate UPLIZNA in patients with myasthenia gravis, a chronic, rare, autoimmune neuromuscular disease that affects voluntary muscles, especially those that control the eyes, mouth, throat and limbs.

IgG4-Related Disease Trial: Phase 3 randomized, placebo-controlled trial underway to evaluate UPLIZNA in patients with IgG4-related disease, which is a group of disorders marked by tumor-like swelling and fibrosis of affected organs, such as the pancreas, salivary glands and kidneys.

Kidney Transplant Desensitization Trial: Phase 2 open-label trial underway to evaluate UPLIZNA, HZN-4920 or both in highly-sensitized patients waiting for a kidney transplant.

HZN-825, an oral lysophosphatidic acid receptor 1 (LPAR1) antagonist that prevents gene activation.

Diffuse Cutaneous Systemic Sclerosis Trial: Pivotal Phase 2b trial to evaluate HZN-825 in diffuse cutaneous systemic sclerosis expected to initiate in the third quarter of 2021.

Interstitial Lung Disease Trial: Pivotal Phase 2b trial to evaluate HZN-825 in idiopathic pulmonary fibrosis, the most common form of interstitial lung disease, expected to initiate in the third quarter of 2021.

HZN-4920, a CD40 ligand antagonist that blocks T cell interaction with the CD40-expressing B cells, disrupting the overactivation of the CD40 ligand co-stimulatory pathway. Several autoimmune diseases are associated with the overactivation of this pathway.

Sjögren’s Syndrome Trial: Phase 2b randomized, placebo-controlled trial underway to evaluate HZN-4920 in patients with Sjögren’s syndrome, a chronic, systemic autoimmune condition that impacts exocrine glands, including the salivary and tear glands.

Rheumatoid Arthritis Trial: Phase 2 randomized, placebo-controlled trial underway to evaluate HZN-4920 in patients with rheumatoid arthritis.

Kidney Transplant Rejection Trial: Phase 2 open-label trial underway to evaluate HZN-4920 in kidney transplant rejection patients.
HZN-7734, an anti-ILT7 human monoclonal antibody that depletes certain dendritic cells. Depleting these cells may interrupt the cycle of inflammation that causes tissue damage in diseases such as lupus, and a variety of other autoimmune conditions.

SLE Trial: Phase 2 randomized, placebo-controlled trial initiated in June 2021 to evaluate HZN-7734 in patients with SLE, a disease in which the body’s immune system attacks its own tissues and organs.

HZN-1116 Autoimmune Disease Trial: Phase 1 trial initiated in July 2021 to evaluate HZN-1116, a monoclonal antibody, in patients with autoimmune diseases.
Second-Quarter Financial Results

Note: For additional detail and reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures, please refer to the tables at the end of this release.

Net Sales: Second-quarter 2021 net sales were $832.5 million, an increase of 80 percent compared to the second quarter of 2020.
Gross Profit: Under U.S. GAAP, the second-quarter 2021 gross profit ratio was 75.9 percent compared to 73.7 percent in the second quarter of 2020. The non-GAAP gross profit ratio in the second quarter of 2021 was 87.7 percent compared to 88.4 percent in the second quarter of 2020.
Operating Expenses: Research and development (R&D) expenses were 16.8 percent of net sales and selling, general and administrative (SG&A) expenses were 42.7 percent of net sales. Non-GAAP R&D expenses were 9.7 percent of net sales, and non-GAAP SG&A expenses were 33.8 percent of net sales.
Income Tax Benefit: In the second quarter of 2021, income tax benefit on a GAAP and non-GAAP basis was $42.5 million and $35.6 million, respectively.
Net Income: On a GAAP basis in the second-quarter of 2021, net income was $158.1 million. Second-quarter 2021 non-GAAP net income was $381.4 million.
Adjusted EBITDA: Second-quarter 2021 adjusted EBITDA was $366.9 million.
Earnings (Loss) per Share: On a GAAP basis, diluted earnings per share in the second quarter of 2021 was $0.67. GAAP loss per share in the second quarter of 2020 was $0.42. Non-GAAP diluted earnings per share in the second quarter of 2021 and 2020 were $1.62 and $0.40, respectively. Weighted average shares outstanding used for calculating GAAP and non-GAAP diluted earnings per share in the second quarter of 2021 were 235.2 million.
Second-Quarter Segment Results

Management uses net sales and segment operating income to evaluate the performance of the Company’s two segments, the orphan segment and the inflammation segment. While segment operating income contains certain adjustments to the directly comparable GAAP figures in the Company’s consolidated financial results, it is considered to be prepared in accordance with GAAP for purposes of presenting the Company’s segment operating results.

Second-quarter 2021 net sales of the orphan segment, the Company’s strategic growth segment, were $746.5 million, an increase of 97 percent over the prior year’s quarter, driven by the strong relaunch execution of TEPEZZA, as well as strong year-over-year growth of KRYSTEXXA, RAVICTI and PROCYSBI. The orphan segment represented 90 percent of total second-quarter net sales.
KRYSTEXXA second-quarter 2021 net sales increased 73 percent year-over-year driven by increased adoption of KRYSTEXXA plus immunomodulation, which now exceeds 40 percent. In addition, the Company continues to see strong uptake of KRYSTEXXA from both rheumatologists and nephrologists.
Second-quarter 2021 orphan segment operating income was $321.2 million, which includes additional investment associated with TEPEZZA, UPLIZNA and the Company’s pipeline programs.
Second-quarter 2021 net sales of the inflammation segment were $86.0 million, and segment operating income was $46.8 million.
Cash Flow Statement and Balance Sheet Highlights

On a GAAP basis, operating cash flow in the second quarter of 2021 was $89.4 million. Non-GAAP operating cash flow was $146.7 million.
As of June 30, 2021, the Company had cash and cash equivalents of $812.3 million.
As of June 30, 2021, the total principal amount of debt outstanding was $2.614 billion, and the gross-debt-to-last-12-months adjusted EBITDA leverage ratio was 2.3 times.

2021 Guidance

The Company now expects full-year 2021 net sales to range between $3.025 billion and $3.125 billion, representing 40 percent growth at the midpoint and an increase from the previous range of $2.75 billion and $2.85 billion. The company now expects TEPEZZA full-year 2021 net sales of greater than $1.550 billion with year-over-year growth of more than 50 percent in the fourth quarter, compared to the previous guidance of greater than $1.275 billion. The Company continues to expect KRYSTEXXA full-year 2021 net sales of greater than $500 million. Full-year 2021 adjusted EBITDA is now expected to range between $1.26 billion and $1.30 billion, representing 28 percent growth at the midpoint and an increase from the previous guidance range of $1.02 billion and $1.06 billion.

Webcast

At 8 a.m. EST / 1 p.m. IST today, the Company will host a live webcast to review its financial and operating results and provide a general business update. The live webcast and a replay may be accessed at View Source Please connect to the Company’s website at least 15 minutes prior to the live webcast to ensure adequate time for any software download that may be needed to access the webcast. A replay of the webcast will be available approximately two hours after the live webcast.