On April 29, 2021 MacroGenics, Inc. (NASDAQ: MGNX), a biopharmaceutical company focused on developing and commercializing innovative monoclonal antibody-based therapeutics for the treatment of cancer, reported an update on its recent corporate progress and reported financial results for the quarter ended March 31, 2021 (Press release, MacroGenics, APR 29, 2021, View Source [SID1234578756]).

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"With the recent launch and commercialization of MARGENZA, we are delivering on our vision to provide potentially life-changing therapeutics to patients with cancer. We are well positioned to advance this mission as the growing body of data emerges from our deep pipeline of clinical and pre-clinical product candidates," said Scott Koenig, M.D., Ph.D., President and CEO of MacroGenics, "and we look forward to sharing additional data with you as the year progresses."

Key Updates on Proprietary Programs

Recent progress and anticipated events in 2021 related to MacroGenics’ approved and investigational product candidates in clinical development are highlighted below.

Margetuximab is an Fc-engineered, monoclonal antibody (mAb) that targets the HER2 oncoprotein, which is expressed by certain breast, gastroesophageal and other solid tumor cells.

MARGENZA (margetuximab-cmkb) commercial launch. In mid-March 2021, MacroGenics and its commercial partner, EVERSANA, launched MARGENZA for the treatment of adult patients with metastatic HER2-positive breast cancer, in combination with chemotherapy, who have received two or more prior anti-HER2 regimens, at least one of which was for metastatic disease. Also during the quarter, results from the SOPHIA metastatic breast cancer Phase 3 study of MARGENZA were published in the Journal of the American Medical Association (JAMA) Oncology. Finally, based on the current accrual rate of overall survival (OS) events in the ongoing SOPHIA trial that supported approval by the FDA, the Company now anticipates completing the final analysis of OS data, based on accrual of the 385th OS event, by the end of the third quarter.

Phase 2/3 MAHOGANY study in advanced gastric and gastroesophageal junction cancer. The MAHOGANY clinical program contains two modules designed to evaluate margetuximab as an investigational agent in combination with a checkpoint inhibitor, with or without chemotherapy, as a potential first-line treatment for patients with advanced or metastatic HER2-positive GC/GEJ. All 40 patients have been enrolled in the first part of Module A, which is evaluating margetuximab in combination with retifanlimab (an anti-PD-1 therapy). The Company expects to report safety and efficacy data in the third quarter of 2021. Enrollment in Module B, which is evaluating margetuximab plus MacroGenics’ checkpoint inhibitor molecules in combination with chemotherapy compared to standard of care therapy of trastuzumab with chemotherapy in patients with HER2-positive tumors irrespective of PD-L1 expression, is currently ongoing in coordination with MacroGenics’ regional partner in Greater China, Zai Lab.

Flotetuzumab is a bispecific CD123 × CD3 DART molecule being evaluated in patients with primary induction failure (PIF) and early relapsed (less than six months, or ER6) acute myeloid leukemia (AML). MacroGenics is conducting a single-arm, registration-enabling clinical study to evaluate flotetuzumab in up to 200 patients with PIF/ER6 AML, with complete remission (CR) and CR with partial hematological recovery (CRh) as the composite primary endpoint. The Company anticipates providing further updates on the clinical development of flotetuzumab in late 2021 and completing full enrollment of this study in 2022.

MGC018 is an antibody-drug conjugate (ADC) that targets B7-H3. In April 2021, MacroGenics presented pre-clinical data at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting demonstrating that at clinically relevant dose levels, MGC018 potentiated antitumor activity in vivo in mouse patient-derived xenograft (PDX) models of squamous cell carcinoma of the head and neck (SCCHN). MacroGenics recently expanded its Phase 1 clinical study to include SCCHN and melanoma; the Company continues to enroll patients with metastatic castration-resistant prostate cancer (mCRPC), triple negative breast cancer (TNBC) and non-small cell lung cancer (NSCLC). MacroGenics will provide a clinical data update via poster presentation at the upcoming American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) 2021 Annual Meeting, June 4-8, 2021.

Enoblituzumab is an Fc‐engineered, anti‐B7‐H3 mAb. During the first quarter, MacroGenics initiated a Phase 2 study of enoblituzumab in a chemotherapy-free regimen in combination with retifanlimab in front-line patients with SCCHN who are PD-L1 positive and with tebotelimab in SCCHN patients who are PD-L1 negative.
Tebotelimab is a bispecific, tetravalent DART molecule targeting PD-1 and LAG-3. Tebotelimab is being evaluated in a Phase 1 dose expansion study as monotherapy in several tumor types. MacroGenics expects to provide updates on the next-stage of development for tebotelimab later this year.

MGD019 is a bispecific, tetravalent DART molecule targeting PD-1 and CTLA-4. The Company is conducting Phase 1 dose expansion cohorts at the recommended Phase 2 dose in patients with microsatellite stable colorectal cancer (MSS CRC) and checkpoint-naïve NSCLC and recently added cohorts of patients with mCRPC and melanoma.

IMGC936 is an ADC that targets ADAM9, a cell surface protein over-expressed in several solid tumor types, and is being developed jointly under a 50/50 collaboration with ImmunoGen, Inc. Pre-clinical data recently presented at the AACR (Free AACR Whitepaper) Annual Meeting showed that IMGC936 had activity against multiple solid tumor types in in vivo mouse PDX models. Under the collaboration, ImmunoGen is leading clinical development of IMGC936 in a Phase 1 clinical trial evaluating safety and pharmacokinetics in patients with select cancers and have indicated they anticipate disclosing initial data by early 2022.

MGD024 is a next-generation, bispecific CD123 × CD3 DART molecule in preclinical development. The molecule incorporates a CD3 component designed to minimize cytokine-release syndrome, while maintaining anti-tumor cytolytic activity, along with an Fc domain to permit intermittent dosing through a longer half-life. The Company anticipates submitting an Investigational New Drug (IND) application to the FDA by the end of 2021.

First Quarter 2021 Financial Results

Cash Position: Cash, cash equivalents and marketable securities as of March 31, 2021, were $343.2 million, compared to $272.5 million as of December 31, 2020. During the quarter ended March 31, 2021, $98.2 million in net proceeds were received from the sale of 3,622,186 shares of the Company’s common stock pursuant to its at-the-market (ATM) offering.

Revenue: Total revenue, consisting primarily of revenue from collaborative agreements, was $16.9 million for the quarter ended March 31, 2021, including $0.9 million net sales of MARGENZA, which was launched in mid-March, compared to $13.7 million for the quarter ended March 31, 2020. This increase was primarily due to the recognition of a $10 million milestone from Incyte, partially offset by a decrease of approximately $5.8 million recognized under a clinical supply agreement with Incyte.

R&D Expenses: Research and development expenses were $53.1 million for the quarter ended March 31, 2021, compared to $48.9 million for the quarter ended March 31, 2020. This increase was primarily due to higher expenses related to flotetuzumab, MGC018, MGD019 and preclinical projects, partially offset by a decrease in development and manufacturing costs for retifanlimab.

SG&A Expenses: Selling, general and administrative expenses were $15.0 million for the quarter ended March 31, 2021, compared to $10.2 million for the quarter ended March 31, 2020. This increase was primarily due to MARGENZA pre-launch and launch costs.

Net Loss: Net loss was $51.3 million for the quarter ended March 31, 2021, compared to net loss of $44.7 million for the quarter ended March 31, 2020.

Shares Outstanding: Shares outstanding as of March 31, 2021 were 60,011,206.
Cash Runway Guidance: MacroGenics anticipates that its cash, cash equivalents and marketable securities as of March 31, 2021, as well as anticipated and potential collaboration payments, should enable it to fund its operations through 2023, assuming the Company’s programs and collaborations advance as currently contemplated.

Conference Call Information

MacroGenics will host a conference call today at 4:30 p.m. (ET) to discuss financial results for the quarter ended March 31, 2021 and provide a corporate update. To participate in the conference call, please dial (877) 303-6253 (domestic) or (973) 409-9610 (international) five minutes prior to the start of the call and provide the Conference ID: 5257004.

The listen-only webcast of the conference call can be accessed under "Events & Presentations" in the Investor Relations section of the Company’s website at View Source A replay of the webcast will be available shortly after the conclusion of the call and archived on the Company’s website for 30 days following the call.

MACROGENICS, INC.
SELECTED CONSOLIDATED BALANCE SHEET DATA
(Amounts in thousands)

March 31, 2021

December 31, 2020

(unaudited)

Cash, cash equivalents and marketable securities
$
343,177

$
272,531

Total assets
435,445

378,743

Deferred revenue
10,780

11,382

Total stockholders’ equity
350,531

295,884

MACROGENICS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
(Amounts in thousands, except share and per share data)

Three Months Ended March 31,

2021

2020
Revenues:

Revenue from collaborative and other agreements
$
15,184

$
12,967

Product revenue, net
887

—

Revenue from government agreements
810

715

Total revenues
16,881

13,682

Costs and expenses:

Cost of product sales
17

—

Research and development
53,121

48,894

Selling, general and administrative
15,036

10,233

Total costs and expenses
68,174

59,127

Loss from operations
(51,293
)

(45,445
)
Other income
21

721

Net loss
(51,272
)

(44,724
)
Other comprehensive income:

Unrealized gain on investments
18

56

Comprehensive loss
$
(51,254
)

$
(44,668
)

Basic and diluted net loss per common share
$
(0.90
)

$
(0.91
)
Basic and diluted weighted average common shares outstanding
57,202,846

49,012,663

On April 29, 2021 Novo Seeds, the early stage investment and company creation team of Novo Holdings, reported an investment in Adcendo, a Danish biotech company which is developing antibody-drug conjugates (ADCs) for the treatment of cancers (Press release, Novo, APR 29, 2021, View Source [SID1234578812]). The EUR 51 million (US$ 62 million) Series A financing was led by Novo Seeds and Ysios Capital, along with RA Capital Management, HealthCap and Gilde Healthcare.

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The new financing, which is the largest Series A financing for a Danish biotech company, will be used to establish a pipeline of ADCs directed at novel cancer targets and to bring the lead program targeting the novel cancer target uPARAP/Endo180 to proof of concept in patients.

The company has been supported by Novo Seeds since 2017 and was incubated in 2018 at the BioInnovation Institute (BII), an international life sciences incubator in Copenhagen. Novo Seeds supported the company amongst others through leveraging its network in industry and academia to recruit world-renowned experts to the company’s Scientific Advisory Board. As part of the financing, Jeroen Bakker, Principal at Novo Seeds, will join the Board.

Commenting on the financing, Henrik Stage, Chief Executive Officer of Adcendo, said: "We are very pleased to welcome world-leading life sciences investor Novo Seeds to our board as a result of today’s financing and in recognition of its involvement in the company since inception. In the last few years, the ADC modality has delivered promising approvals of new drugs as well as significant commercial transactions. We are excited that we have secured this major financing from top tier investors and are looking forward to delivering on our vision of bringing new innovative treatments to cancer patients."

Jeroen Bakker, Principal at Novo Seeds, commented: "One of our ambitions at Novo Seeds is to leverage and nurture the untapped innovation in the Nordic region. We are proud to have been involved with Adcendo since its early days and are very impressed with the progress achieved to date. We are very pleased to now co-lead this investment with such an exceptional syndicate, building on the founders’ early-stage research at The Finsen Laboratory to develop Adcendo into a world leading ADC player, and we look forward to continuing playing a prominent role in shaping the Nordic biotech ecosystem."

uPARAP is a unique novel cancer target overexpressed on the cell surface of several cancers. Being a collagen scavenger receptor that possesses constitutively active and highly efficient internalization and recycling properties, it has been demonstrated to play a role in tumor invasion. The expression and biological mechanisms of uPARAP makes it ideal for an ADC approach as it may be used as a cancer-associated "drug internalization pump" to bring conjugated drugs directly into the cancer cells.

The uPARAP collagen scavenger receptor has been found to be overexpressed by cancer cells in several indications with high unmet needs including soft tissue sarcoma, glioblastoma multiforme, triple-negative breast cancers, leukemia and osteosarcoma, as well as by stromal cells in several high prevalence cancers with substantial stromal tissue content, such as prostate, breast and pancreatic cancer.

In addition to the uPARAP program, Adcendo will build a pipeline of additional novel cancer targets ideally suited to ADC approaches.

On April 29, 2021 Oncolytics Biotech Inc. (NASDAQ: ONCY) (TSX: ONC) reported the acceptance of an abstract discussing its pancreatic adenocarcinoma trial at the 2021 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting, which is taking place virtually from June 4 – 8, 2021 (Press release, Oncolytics Biotech, APR 29, 2021, View Source [SID1234578794]). Details on the abstract and a corresponding poster presentation are shown below.

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Title: Treatment with pembrolizumab in combination with the oncolytic virus pelareorep promotes anti-tumor immunity in patients with advanced pancreatic adenocarcinoma
Presentation Type: Electronic poster
Session Title: Gastrointestinal Cancer – Gastroesophageal, Pancreatic, and Hepatobiliary
Abstract Number: 4144

The abstract will be published on the ASCO (Free ASCO Whitepaper) Annual Meeting website at 5:00 p.m. ET on May 19, 2021. The corresponding poster will be made available on the meeting website at 9:00 a.m. ET on June 4, 2021.

On April 29, 2021 Baxter International Inc. (NYSE:BAX), a leading global medical products company, reported results for the first quarter of 2021 (Press release, Baxter International, APR 29, 2021, View Source [SID1234578835]).

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"Baxter’s medically essential products are fundamental to healthcare, and many have proven pivotal in the fight against COVID-19," said José (Joe) E. Almeida, chairman, president and chief executive officer. "Our life-sustaining portfolio, broad geographic reach and the ongoing momentum of our business transformation are all keys to our resilience. We are well positioned to strengthen our impact in the year ahead, fueled by our innovative product pipeline, relentless focus on execution, and capital deployment opportunities to benefit patients, customers and investors."

First-Quarter Financial Results

Worldwide sales in the first quarter totaled approximately $2.9 billion, an increase of 5% on a reported basis and 1% on both a constant currency and operational basis. Operational sales in the first quarter exclude the impact of foreign exchange and the company’s recent acquisition of the rights to Caelyx and Doxil, the branded versions of liposomal doxorubicin, for specified territories outside of the United States (OUS).

Sales in the U.S. totaled $1.2 billion, decreasing 3% on both a reported and operational basis. International sales of $1.8 billion increased 11% on a reported basis, 5% on a constant currency basis and 4% on an operational basis.

Starting this quarter, Baxter is adding the sales of its BioPharma Solutions contract manufacturing unit to its financial schedules, which break out sales by key product category. Historical schedules reflecting this new structure are available on Baxter’s Investor Relations website.

Performance in the first quarter was driven by Acute Therapies which delivered significant growth at both reported and constant rates, reflecting sustained higher levels of product demand due to the ongoing COVID-19 pandemic. BioPharma Solutions also delivered double-digit growth at reported and constant rates, driven by multiple collaborations to help manufacture COVID-19 vaccines on a contract basis. Additionally, Clinical Nutrition, Pharmaceuticals and Renal Care grew mid- to high single digits at reported rates, and low single digits at constant rates. This helped offset declines in Medication Delivery and Advanced Surgery, reflecting lower rates of hospital admissions and elective surgeries, respectively, in the wake of the ongoing pandemic, as well as a challenging comparison to performance in the previous year’s quarter.

Please see the attached schedules accompanying this press release for additional details on sales performance in the quarter, including breakouts by Baxter’s key product categories and geographic segments.

For the first quarter, net income attributable to Baxter was $298 million, or $0.58 per diluted share, a decline of 9% on a U.S. GAAP (Generally Accepted Accounting Principles) basis. These results include special items totaling $88 million after-tax, which were primarily related to intangible asset amortization, business optimization charges, and a proposed settlement of shareholder litigation related to the company’s investigation of foreign exchange gains and losses associated with certain intra-company transactions. On an adjusted basis, net income attributable to Baxter totaled $386 million, or $0.76 per diluted share, a 7% decline for the quarter. This exceeded the company’s previously issued guidance range of $0.63 to $0.65, driven by operational strength and a lower tax rate.

Business Highlights2

Baxter continues to achieve notable strategic milestones in pursuit of its Mission to Save and Sustain Lives. Among recent highlights, the company:

Received U.S. FDA 510(k) clearance for its AK 98 (Artificial Kidney 98) dialysis machine, designed to be a portable and easy-to-use system to administer hemodialysis treatments. Among its features, AK 98 offers encrypted, two-way connectivity, which enables the system to pull prescriptions directly from the electronic medical record (EMR) for simplified workflow and data handling.
Resubmitted to the U.S. FDA for 510(k) clearance of Baxter’s leading-edge Novum IQ Infusion platform. The platform includes both large volume and syringe infusion pumps, and features Baxter’s Dose IQ Safety Software and IQ Enterprise Connectivity Suite, intuitive digital health technologies developed to protect patients, manage devices and provide advanced insights.
Announced an agreement with Moderna, Inc., for Baxter BioPharma Solutions to provide fill/finish sterile manufacturing services and supply packaging for approximately 60 to 90 million doses of the Moderna COVID-19 vaccine in 2021. This partnership follows earlier agreements announced with BioNTech and Novavax to provide manufacturing services for their respective COVID-19 vaccines.
Strengthened its European and global pharmaceuticals portfolio through strategic rights acquisitions in line with the company’s strategy to bolster its pharmaceuticals business and expand its presence globally in specialty pharmaceuticals:
The company acquired rights to specified territories outside of the U.S. to the widely prescribed chemotherapy medication Caelyx, known as Doxil in several geographies, including the U.S.; this supplements Baxter’s U.S. rights to Doxil, acquired in 2019.
Baxter also acquired full U.S. and specified OUS rights to the anti-nausea medication Transderm Scop, representing a key adjacency to Baxter’s industry-leading inhaled anesthetics portfolio; Baxter previously had a license to sell the product to select customers in the U.S.
Corporate Responsibility

Baxter is fully committed to promoting the power of diversity in support of its Mission. The company’s multidimensional ACT (Activating Change Today) initiative is focused on advancing racial justice for our employees, external stakeholders, and the markets and communities Baxter serves. Among recent highlights, Baxter:

Announced a new partnership with the American Diabetes Association (ADA) through the ADA’s Health Equity Now platform to address health disparities for people with diabetes in Chicago’s underserved Black communities. The program is made possible through a three-year, $2 million grant from the Baxter International Foundation.
Launched a new Baxter-supported partnership with The Links, Incorporated, an international not-for-profit comprised of 16,000 women of color, to advance a multifaceted, community-based campaign to bring awareness and resources to help address the disproportionate challenges affecting Black Americans related to kidney health. Central to this effort is an educational toolkit developed by The National Kidney Foundation of Illinois focusing on the unique barriers facing the Black community.
Baxter continues to be recognized for its commitment to corporate social responsibility and workplace excellence. The company was most recently:

Cited by Forbes as one of America’s Best Employers for Diversity 2021.
Recognized on Seramount’s inaugural Global Inclusion Index for the strength of local diversity, equality, and inclusion (DE&I) efforts in Brazil, China, France, Germany, India, Ireland, Italy, Japan, Mexico, Singapore, and the United Kingdom. All Baxter geographies participating in the assessment earned recognition.
2021 Financial Outlook

For full-year 2021: Baxter now expects U.S. GAAP earnings of $2.85 to $2.93 per diluted share and adjusted earnings, before special items, of $3.47 to $3.55 per diluted share. The company expects sales growth of 8% to 9% on a reported basis, 5% to 6% on a constant currency basis and 4% to 5% on an operational basis.

For second-quarter 2021: The company expects sales growth of 14% to 15% on a reported basis, 8% to 9% on a constant currency basis and 7% to 8% on an operational basis. The company expects U.S. GAAP earnings of $0.54 to $0.57 per diluted share and adjusted earnings, before special items, of $0.72 to $0.75 per diluted share.

Full-year and quarterly operational sales estimates for 2021 have been adjusted to exclude the impact of foreign exchange and the acquisition of specified OUS rights to Caelyx/Doxil.

A webcast of Baxter’s first-quarter 2021 conference call for investors can be accessed live from a link on the company’s website at www.baxter.com beginning at 7:30 a.m. CDT on April 29, 2021. Please see www.baxter.com for more information regarding this and future investor events and webcasts.

About Baxter

Every day, millions of patients and caregivers rely on Baxter’s leading portfolio of critical care, nutrition, renal, hospital and surgical products. For more than 85 years, we’ve been operating at the critical intersection where innovations that save and sustain lives meet the healthcare providers that make it happen. With products, technologies and therapies available in more than 100 countries, Baxter’s employees worldwide are now building upon the company’s rich heritage of medical breakthroughs to advance the next generation of transformative healthcare innovations. To learn more, visit www.baxter.com and follow us on Twitter, LinkedIn and Facebook.

Non-GAAP Financial Measures

This press release and the accompanying tables contain financial measures that are not calculated in accordance with U.S. GAAP. The non-GAAP financial measures include adjusted gross margin, adjusted selling, general and administrative expense, adjusted research and development expense, adjusted other operating income, net, adjusted operating income, adjusted operating margin, adjusted income before income taxes, adjusted income tax expense, adjusted net income, adjusted net income attributable to Baxter stockholders, and adjusted diluted earnings per share, all of which exclude special items, sales growth on a constant currency and operational basis, and free cash flow. Special items are excluded because they are highly variable or unusual, and of a size that may substantially affect the company’s reported operations for a period. Certain of those items represent estimates based on information reasonably available at the time of the press release. Future events or new information may result in different actual results.

Net sales growth rates are presented on a constant currency basis. These measures provide information on the percentage change in net sales growth assuming that foreign currency exchange rates have not changed between the prior and current periods. Net sales growth rates are also presented on an operational basis. For the quarter ended March 31, 2021, operational sales growth excludes the impact of foreign exchange and the company’s recent acquisition of specified OUS rights to Caelyx/Doxil. This measure provides information on the change in net sales growth rates assuming that foreign exchange rates remain constant and excluding the impact of the company’s recent acquisition of specified OUS rights to Caelyx/Doxil.

For the quarter ended March 31, 2021, special items include intangible asset amortization, business optimization charges, acquisition and integration expenses, expenses related to European medical devices regulation and investigation and related costs. These items are excluded because they are highly variable or unusual and of a size that may substantially impact the company’s reported operations for a period. Additionally, intangible asset amortization is excluded as a special item to facilitate an evaluation of current and past operating performance and is consistent with how management and the company’s Board of Directors assess performance.

Non-GAAP financial measures may enhance an understanding of the company’s operations and may facilitate an analysis of those operations, particularly in evaluating performance from one period to another. Management believes that non-GAAP financial measures, when used in conjunction with the results presented in accordance with U.S. GAAP and the reconciliations to corresponding U.S. GAAP financial measures, may enhance an investor’s overall understanding of the company’s past financial performance and prospects for the future. Accordingly, management uses these non-GAAP measures internally in financial planning, to monitor business unit performance, and, in some cases, for purposes of determining incentive compensation. This information should be considered in addition to, and not as substitutes for, information prepared in accordance with U.S. GAAP.

On April 29, 2021 Orexo reported that Q1 2021 Interim Report (Press release, Orexo, APR 29, 2021, View Source [SID1234578849])

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Q1 2021 summary

Total net revenues of SEK 132.3 m (175.0)
Net earnings of SEK -31.5 m (82.6)
EBITDA of SEK -23.9 m (39.1)
US Pharma segment (ZUBSOLV US) net revenues of SEK 126.8 m (163.9), EBIT of SEK 66.1 m (75.9)
Cash flow from operating activities of SEK -47.8 m (48.1), cash balance of SEK 725.5 m (861.4)
A new patent for OX124, overdose rescue medication, was issued by the US Patent and Trademark Office (USPTO), protecting the technology until 2039
Issued a new corporate bond amounting to a nominal value of SEK 500 m and redemption of the corporate bond issued in 2017
A partnership agreement was reached with Magellan Rx, the third largest payor for treatment of opioid dependence in the US, to test modia with patients and other payors in their network
A new patent for ZUBSOLV, with protection until 2032, was issued by the USPTO

ZUBSOLV demand will contribute to a solid foundation for future growth
During the first quarter of 2021, we made good progress on multiple fronts. I am pleased to see that ZUBSOLV demand has stabilized compared to the previous quarter, alongside the refinancing of the corporate bond, which has further strengthened Orexo´s opportunity to grow. Within our innovative digital therapeutic venture, several important steps have been taken to encourage growth in this new market and for our sales to start gaining momentum. As US society is moving to post-pandemic conditions, access to our customers is also increasing. This will be an important driver for ZUBSOLV to return to growth and for the launch of our clinically proven digital therapies.

ZUBSOLV – continued strong EBIT contribution from US Pharma
We have seen a decline in ZUBSOLV net sales in Q1 as expected, following the seasonal patterns for Q1 seen since the launch of the product. This year we have fewer shipping days in Q1 compared to Q4, leading to an overall decline in the market despite a positive weekly trend. For ZUBSOLV, wholesalers and pharmacies traditionally build inventory in Q4 in anticipation of price increases in January. Patients in the commercial payer segment also have their co-pay reset at the start of a new calendar year, which leads to a slow down in this part of the market. Overall, I have been pleased to see the weekly demand, i.e. prescriptions of ZUBSOLV, stabilizing over the quarter,¹ and in particular to see a couple percent growth in weekly prescriptions in the Open segment, despite the difficulties for our sales representatives to access their customers due to Covid-19.
I am also proud we have maintained a strong EBIT contribution of 52 percent in the quarter, which should be seen in light of increased legal expenses. A stable sales and EBIT contribution from ZUBSOLV, together with the refinancing of the corporate bond, enable us to invest in establishing Orexo as a leading player in digital health, without impacting the development of our pharmaceutical pipeline.

Digital therapeutics – a high-potential market in its infancy
We have made important progress over the quarter to expand the market for digital therapeutics. We signed an agreement with Magellan Rx, one of the largest Pharmacy Benefit Managers (PBMs) in the US, to conduct a real world evidence study with modia, to demonstrate its potential as a valuable treatment option in opioid use disorder. modia was the reason we entered digital therapies and we continue to see significant value in the combination with primarily ZUBSOLV, but also other buprenorphine products for patients, physicians and payers, such as Magellan Rx. We have also initiated a pilot of vorvida and deprexis with a leading US tech company, and two larger healthcare providers are preparing an integration of vorvida and deprexis into their treatment programs during Q2. The latter are leveraging a similar insurance pathway as the one Orexo recently tested with vorvida in Pennsylvania. The test in Pennsylvania will now expand into new geographies and the insurance pathway will be the basis of the launch of deprexis to health care providers which has started in April.

Despite the obvious patient need for these ground-breaking treatments, the implementation of digital therapies takes time and we need more awareness and evidence for the therapies before we can expect the market to accelerate. We are therefore focusing our efforts on setting up pilots and trials with well known health care providers, employers and payers to receive their endorsements and recommendations. So far I am encouraged by the positive feedback we are receiving and in particular their compliments to the products when comparing to other digital therapies they have assessed and look forward seeing this translate into a revenue contribution as the pilots transform into commercial contracts.

OX124 – urgent need for new treatment of opioid overdose
New preliminary yearly data2 from Center of Disease Control indicates an increase in overdoses by
27 percent, where the portion caused by synthetic opioids, such as fentanyl, rose by 49 percent. Thus the need for our most advanced development project, OX124, a rescue medication for opioid overdose, is increasing everyday. We continue to make good progress towards initiating the final clinical study according to plan in late Q2. In parallel, minor adjustments were made to build up the supply chain in preparation to launch in the US market in 2023. With the differentiation shown in the first clinical study, versus the leading product on the market, we are confident the commercial potential for the product in the US is substantial.

Summary and outlook
Social responsibility in the pharmaceutical industry is becoming increasingly important, especially in the wake of Covid-19. The number of people suffering from mental illness and substance use disorders is growing rapidly. Orexo’s ongoing transformation journey, from a one-product company to a company offering both pharmaceuticals and clinically proven digital therapies, means that we will be able to help many more people in urgent need of help. This mission is fully embraced by my excellent staff in both Sweden and the US, and is underpinned by our solid financial position.

Presentation
At 2.00 pm CET, the same day as the announcement of the report, Orexo invites analysts, investors and media to
attend a presentation where Nikolaj Sørensen, CEO and Joseph DeFeo, CFO, will present the report and host a Q&A.
Questions can also be sent in advance to [email protected] , no later than 11.00 am CET.
Please view the instructions below on how to participate.
Internet: View Source
Telephone: SE + 46 8 505 583 56 UK + 44 333 300 92 61 US + 1 833 823 05 90
The presentation material will be available on Orexo´s website prior to the audiocast, view Investors/Reports, presentations and audicasts

This information is information that Orexo AB (publ.) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 8.00 am CET on April 29, 2021.