On August 8, 2021 Epizyme, Inc. ("Epizyme") (Nasdaq: EPZM), a fully integrated, commercial-stage biopharmaceutical company developing and delivering novel epigenetic therapies, and HUTCHMED (China) Limited ("HUTCHMED") (Nasdaq/AIM:HCM; HKEX:13),reported a collaboration to research, develop, manufacture and commercialize TAZVERIK in Greater China, including mainland China, Hong Kong, Macau and Taiwan (the "Territory") (Press release, Epizyme, AUG 8, 2021, View Source [SID1234586061]).

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TAZVERIK is a methyltransferase inhibitor of EZH2 developed by Epizyme that is approved by the U.S. Food and Drug Administration ("FDA") for the treatment of certain patients with epithelioid sarcoma ("ES") and certain patients with follicular lymphoma ("FL"). It was approved under FDA accelerated approval based on overall response rate ("ORR") and duration of response ("DOR") in January and June 2020 for ES and FL, respectively.

"We are thrilled to be able to launch this collaboration designed to bring TAZVERIK to patients in Greater China and to have HUTCHMED participate in the global development of TAZVERIK," commented Mr. Robert Bazemore, Epizyme President and CEO. "HUTCHMED is an ideal partner for us in Greater China, given their development and commercial expertise and shared commitment to expanding the value of TAZVERIK through new clinical trials that complement Epizyme’s development plans." Mr. Bazemore continued, "Through this collaboration we anticipate TAZVERIK to become the first EZH2 inhibitor brought to market in Greater China, and we believe the involvement of HUTCHMED in the global development of TAZVERIK can allow for a more rapid, resource-efficient, and geographically inclusive development plan for the U.S. confirmatory EZH-302 trial of TAZVERIK in second line follicular lymphoma (2L FL) in combination with Revlimid plus rituximab (‘R²’)."

"We view the activity of TAZVERIK and its epigenetic mechanism in controlling the expression of certain genes as highly complementary and potentially synergistic with our broad portfolio of novel oncology assets," said Mr. Christian Hogg, CEO of HUTCHMED. "TAZVERIK’s potential for broad applicability and favorable safety profile may provide further inhibition of tumor growth and metastasis when used in combination therapy. This collaboration will accelerate the exploration of the clinical potential of EZH2 inhibition in multiple tumor types, including both hematological malignancies and solid tumors. We believe that Epizyme and HUTCHMED are uniquely positioned to realize these opportunities and thereby rapidly benefit as many patients, both inside and outside China, as possible."

Under the terms of the agreement, HUTCHMED will be responsible for the development and commercialization of TAZVERIK in greater China. Epizyme will receive a US$25 million upfront payment and is eligible to receive up to an additional US$110 million in development and regulatory milestone payments, across up to eight potential indications, and up to an additional US$175 million in sales milestone payments. Epizyme is also eligible to receive tiered royalties of mid -teen to low-twenties-percent based on annual net sales of TAZVERIK in Greater China. In addition, HUTCHMED receives a four-year warrant to acquire up to US$65 million of Epizyme shares at US$11.50 per share. The upfront payment will be funded by HUTCHMED from existing cash resources, and potential milestone payments and royalties are expected to be funded from future cash resources including cash from the sales of TAZVERIK.

HUTCHMED plans to develop and seek approval for TAZVERIK in various hematological and solid tumors, including ES, FL and diffuse large b-cell lymphoma ("DLBCL") in its Territory. HUTCHMED will also participate in Epizyme’s global registrational study of TAZVERIK in combination with R² in second line FL, the EZH-302 study, and lead the study in Greater China. The parties also intend to conduct additional global studies jointly. HUTCHMED will generally be responsible for funding all clinical trials of TAZVERIK in its Territory including the portion of global trials conducted therein. Upon any approvals HUTCHMED will be responsible for commercialization in its designated Territory. HUTCHMED will also hold rights to research and manufacture TAZVERIK in the Territory.

Webcast and Conference Call

Analysts and investors are invited to join a webcast and conference call scheduled today – Monday, August 9 – at 9:30 a.m. Eastern Daylight Time / 2:30 p.m. British Summer Time (BST) / 9:30 p.m. Hong Kong Time (HKT). Investors may participate in the call as follows: +1 646 722 4977 (U.S.) / +44 20 3194 0569 (U.K.) / +852 3027 6500 (Hong Kong), or access a live audio webcast of the call via HUTCHMED’s website at www.hutch-med.com/event/. Please use participant access code "85770452#."

About Epigenetics, EZH2, Its Role in Cancer and TAZVERIK’s Complementary Role with HUTCHMED’s Portfolio of Drug Candidates

Epigenetics refers to a broad regulatory system that controls gene expression without altering the sequence of the genes themselves. EZH2 is one member of a class of histone methyltransferases ("HMTs"). It catalyzes the methylation of histone H3 at lysine 27 (H3K27) which controls expression of various genes and in turn plays a role in the normal physiology of many cell types.

Dysregulation of EZH2 has been seen in a wide range of cancers and is associated with poor clinical prognosis and outcomes.1,2 It is associated with follicular lymphoma and diffuse large B-cell lymphoma, B-cell malignancies that are estimated to respectively account for approximately 17% and 32% of the estimated 544,000 new cases of non-Hodgkin Lymphoma (NHL) worldwide in 2020.3,4 EZH2 dysregulation has been described in the five most common solid tumors (breast, lung, colorectum, prostate and stomach) with an estimated combined incidence of over 1 million in 2020 globally.

TAZVERIK inhibits EZH2 which allows transcription of genes involved in functions such as cell cycle control and terminal differentiation and thus TAZVERIK action inhibits cancer cell proliferation. This mechanism of action is highly complementary and potentially synergistic with HUTCHMED’s portfolio of cancer drug candidates. For solid tumors, these include fruquintinib, a highly selective inhibitor of vascular endothelial growth factor receptor, and surufatinib, a unique compound that inhibits angiogenesis and promotes the body’s immune response against tumor cells.5 For hematological malignancies, these include many assets including inhibitors of the B-cell signaling pathway such as the highly selective and potent PI3Kδ inhibitor HMPL-689, the Syk inhibitor HMPL-523 and third generation BTK inhibitor HMPL-7606, as well the IDH1/2 inhibitor HMPL-306, the ERK inhibitor HMPL-295, the FGFR inhibitor HMPL-453 and the CD47 antibody HMPL-A83. The potential for broad applicability and favorable safety profile of TAZVERIK may provide more effective inhibition of tumor growth and metastasis when used in combination therapy.

About TAZVERIK (tazemetostat)

TAZVERIK is a methyltransferase inhibitor indicated in the United States for the treatment of:

Adults and pediatric patients aged 16 years and older with metastatic or locally advanced epithelioid sarcoma not eligible for complete resection.
Adult patients with relapsed or refractory follicular lymphoma whose tumors are positive for an EZH2 mutation as detected by an FDA-approved test and who have received at least two prior systemic therapies.
Adult patients with relapsed or refractory follicular lymphoma who have no satisfactory alternative treatment options.
These indications are approved under accelerated approval by the U.S. FDA based on overall response rate and duration of response. Continued approval for these indications may be contingent upon verification and description of clinical benefit in confirmatory trials.

View the U.S. Full Prescribing Information here: www.Tazverik.com

About TAZVERIK Accelerated Approval in FL

TAZVERIK was approved in the U.S. for the above relapsed/refractory FL indications in June 2020, based on FL cohort efficacy and safety data in a Phase II trial (Study E7438-G000-101, clinicaltrials.gov identifier: NCT01897571).

The efficacy of TAZVERIK was evaluated in an open-label, single-arm, multi-center Phase II clinical trial in patients with histologically confirmed FL whose disease had progressed following at least two prior systemic treatment regimens. Patients were enrolled into two cohorts: one cohort enrolled 45 patients with EZH2 activating mutations and a second cohort enrolled 54 patients with wild-type EZH2. All patients were treated with 800 mg of tazemetostat, administered orally twice a day. The major efficacy outcome measures were ORR and DOR according to the International Working Group Non-Hodgkin Lymphoma (IWG-NHL) criteria (Cheson 2007) as assessed by Independent Review Committee. Median duration of follow-up was 22 months for patients with EZH2 activating mutations and 36 months for patients with wild-type EZH2.

Results of this study were published in The Lancet Oncology.7 Data from the label is below. Among the 45 FL patients with an EZH2 activating mutation who received TAZVERIK, the median age was 62 years (range 38 to 80); 42% were male; 42% had early progression following front-line therapy ("POD24"); and all had an Eastern Cooperative Oncology Group ("ECOG") performance status ("PS") of 0 or 1. The median number of lines of prior systemic therapy was 2.0 (range 1 to 11); 49% were refractory to rituximab and 49% were refractory to their last therapy. In the 42 patients treated with at least 2 prior systemic therapies, the ORR (95% confidence interval) was 69% (53%, 82%), with 12% of patients achieving a complete response and 57% achieving a partial response. The median DOR was 10.9 months and ongoing.

Among the 54 FL patients with wild-type EZH2 who received TAZVERIK, the median age was 61 years (range 36 to 87); 63% were male; 59% had POD24; and 91% had an ECOG PS of 0 or 1. The median number of lines of prior systemic therapy was 3.0 (range 1 to 8); 59% were refractory to rituximab and 41% were refractory to their last therapy. In the 53 patients treated with at least 2 prior systemic therapies, the ORR (95% confidence interval) was 34% (22%, 48%), with 4% of patients achieving a complete response and 30% achieving a partial response. The median DOR was 13.0 months.

Serious adverse reactions, irrespective of attribution, occurred in 30% of patients receiving TAZVERIK. Serious adverse reactions in ≥2% of patients who received TAZVERIK were general physical health deterioration, abdominal pain, pneumonia, sepsis, and anemia. The most common (≥20%) adverse reactions are fatigue, upper respiratory tract infection, musculoskeletal pain, nausea and abdominal pain.

Eight patients (8%) discontinued due to adverse reaction during the trial. There were no reported deaths on study, and no black box warnings or contraindications.

The most common (≥20%) adverse reactions in patients with follicular lymphoma are fatigue, upper respiratory tract infection, musculoskeletal pain, nausea and abdominal pain.

EZH-302 is a global, randomized, double-blind, active-controlled, biomarker enrichment, adaptive design Phase Ib/III confirmatory trial (clinicaltrials.gov identifier: NCT04224493) assessing the combination of TAZVERIK with R² (REVLIMID plus rituximab), an approved chemotherapy-free treatment regimen, compared with R² plus placebo for relapsed or refractory FL patients followed by maintenance TAZVERIK or placebo in the second-line or later treatment setting. The trial is expected to enroll approximately 500 FL patients.

About TAZVERIK Accelerated Approval in ES

TAZVERIK was approved in the U.S. for the above ES indication in January 2020, based on ES cohort 5 efficacy and safety data in a Phase II trial (Study EZH-202, clinicaltrials.gov identifier: NCT02601950).

The efficacy of TAZVERIK was evaluated in an open-label, single-arm cohort (Cohort 5) of a multi-center study in patients with histologically confirmed, metastatic or locally advanced epithelioid sarcoma. Patients were required to have INI1 loss, detected using local tests, and an ECOG PS of 0-2. Patients received TAZVERIK 800 mg orally twice daily until disease progression or unacceptable toxicity. Tumor response assessments were performed every 8 weeks. The major efficacy outcome measures were confirmed ORR according to Response Evaluation Criteria in Solid Tumors (RECIST) v1.1 as assessed by blinded independent central review (BICR) and DOR. Median duration of follow-up was 14 months (range 0.4 to 31).

Results of this study were published in The Lancet Oncology.8 Data from the label is below. Among the 62 patients who received TAZVERIK, median age was 34 years (range 16 to 79); 63% were male, 76% were White, 11% were Asian, 44% had proximal disease, 92% had an ECOG PS of 0 or 1, and 8% had an ECOG PS of 2. Prior surgery occurred in 77% of patients; 61% received prior systemic chemotherapy.

In the total 62 patients treated, the ORR (95% confidence interval) was 15% (7%, 26%), with 1.6% of patients achieving a complete response and 13% achieving a partial response. Among responders in the trial, 67% had a duration of response of six months or longer.

Serious adverse reactions occurred in 37% of patients receiving TAZVERIK. Serious adverse reactions in ≥3% of patients who received TAZVERIK were hemorrhage, pleural effusion, skin infection, dyspnea, pain, and respiratory distress.

One patient (2%) permanently discontinued TAZVERIK due to an adverse reaction of altered mood.

The most common (≥20%) adverse reactions in patients with epithelioid sarcoma are pain, fatigue, nausea, decreased appetite, vomiting and constipation.

EZH-301 is a global, randomized, double-blind, placebo-controlled controlled Phase Ib/III confirmatory trial (clinicaltrials.gov identifier: NCT04204941) assessing TAZVERIK in combination with doxorubicin compared with doxorubicin plus placebo as a front-line treatment for ES. The trial is expected to enroll approximately 150 patients.

About Other TAZVERIK Clinical Development

In addition to the studies in FL and ES, TAZVERIK is also being developed in DLBCL and in prostate cancer and ovarian cancer.

On August 6, 2021 Syntrix reported that A new study led by researchers at NYU Grossman School of Medicine and its Laura and Isaac Perlmutter Cancer Center revealed for the first time that activation of CXCR2 may be a general resistance-response to non-small cell lung cancer (NSCLC) treatments that inhibit the RAS/RAF/MEK/ERK signaling pathway, and may explain why many patients with lung cancer do not respond to such treatments (Press release, Syntrix, AUG 6, 2021, View Source [SID1234586025]).

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Published in Cancer Discovery, findings from the study show that inhibition of CXCR2 signaling with SX-682 increased sensitivity of lung cancer to both investigational and FDA-approved therapies targeting the RAS/RAF/MEK/ERK signaling pathway.

Lung cancer is the most common cause of cancer-related death worldwide, with over 1.8 million lung cancer deaths annually and approximately 236,000 new cases in the U.S. NSCLC accounts for approximately 84% of new lung cancer diagnoses each year.

"These findings have major clinical implications with many existing and new NSCLC treatments inhibiting the RAS/RAF/MEK/ERK signaling pathway, including targeted therapies such as osimertinib to mutant EGFR, and sotorasib and adagrasib (MRTX849) to mutant RAS," said John A. Zebala, MD, PhD, co-author of the study and President at Syntrix Pharmaceuticals.

Using cell culture and mouse models, the NYU team demonstrated how inhibition of SHP2 (SHP2 is required for KRAS activation), KRAS, EGFR or MEK caused activation of CXCR2 signaling that drew granulocytic myeloid-derived suppressor cells (gMDSCs) into tumors. The infiltrating gMDSCs impaired the anti-tumor actions of T cells. The researchers found the same effects on CXCR2 signaling and gMDSC influx in tumors from patients treated with the KRAS G12C-specific inhibitor, adagrasib.

The researchers found that combining SX-682 with SHP2 inhibition in an extremely aggressive mouse tumor model significantly depleted gMDSC infiltration and generated CD8+ effector T cells with strong anti-tumor activity. Compared with SHP2 inhibition alone, the combination completely suppressed tumor growth after two weeks of treatment, the time point at which untreated tumor-bearing mice started to die. The combination also prolonged survival (median: 38 days) compared to SHP2 inhibition alone (median: 27 days) or SX682 alone (median: 21.5 days), more than doubling overall survival compared with untreated (median: 18 days) mice. The team found no toxicity after five weeks of combination treatment. The study concludes that the results support testing of RAS/ERK pathway inhibitors with SX-682 in NSCLC patients.

ABOUT SX-682: SX-682 is an oral allosteric small-molecule inhibitor of CXCR1 and CXCR2 (CXCR1/2) being investigated in several Phase 1/2 clinical trials. CXCR1/2 are a combined "master switch" of the tumor microenvironment. Clinical studies have shown an inverse correlation between blood CXCR1/2 ligands and immune-checkpoint blockade (ICB) response and survival. SX-682 has been validated in major solid tumor models, where it exhibits mono-agent activity, blocks metastasis, depletes MDSCs, activates infiltration and killing by immune effector cells, reverses chemo-resistance, and enhances ICB.

On August 6, 2021 ANI Pharmaceuticals, Inc. ("ANI" or the "Company") (NASDAQ: ANIP) reported business highlights and financial results for the three and six months ended June 30, 2021 (Press release, ANI Pharmaceuticals, AUG 6, 2021, View Source [SID1234586042]).

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Second Quarter and Recent Business Highlights:

The Company refiled its supplemental new drug application ("sNDA") for Cortrophin Gel with the U.S. Food and Drug Administration ("FDA" or the "Agency") on June 29, 2021; goal date is October 29, 2021;
Acquisition of Novitium Pharma LLC ("Novitium"), a privately held, New Jersey-based high-growth pharmaceutical company, is on track to close in the second half of 2021, pending Federal Trade Commission ("FTC") clearance and customary closing conditions; and
Acquired new drug applications ("NDAs") from Sandoz Inc. for a portfolio of dermatology products.
Second Quarter 2021 Financial Highlights:

Net revenues were $48.6 million compared to $48.5 million in Q2 2020.
GAAP net loss was $14.1 million, and diluted GAAP loss per share was ($1.17).
Adjusted non-GAAP EBITDA was $13.1 million.
Adjusted non-GAAP diluted earnings per share was $0.67.
Cash and cash equivalents were $24.3 million, net accounts receivable was $92.6 million, and face value of debt was $205.7 million as of June 30, 2021.
"In the second quarter, we made meaningful progress executing on the four pillars of our growth strategy. Most notably, on June 29, we refiled our sNDA with the FDA for Cortrophin Gel. Since that time, we have engaged in productive communication with the Agency. In support of this important asset, we are continuing to strengthen our leadership team to drive our commercial strategy forward. This refiling is a significant milestone for the organization, and I am proud of what we have accomplished to date. If approved, Cortrophin has the potential to improve access for patients in need and transform ANI," said Nikhil Lalwani, President and CEO of ANI.

"We appreciate our stockholders’ overwhelming support for the Novitium acquisition at our Annual Meeting of Stockholders. The transaction is on track to close later this year, and planning for maximizing the value of the combined assets for all stakeholders is well under way. We have also integrated the four dermatology products acquired from Sandoz, thus expanding our branded portfolio. It is an important and exciting time for ANI, and we look forward to providing updates as we move forward on our growth journey," concluded Lalwani.

Second Quarter 2021 Financial Results

Net Revenues
(in thousands)

Three Months Ended
June 30,

2021

2020

Generic pharmaceutical products

$

34,199

$

33,400

Branded pharmaceutical products

11,038

10,633

Contract manufacturing

2,322

2,900

Royalty and other income

1,066

1,537

Total net revenues

$

48,625

$

48,470

Net revenues for generic pharmaceutical products were $34.2 million during the three months ended June 30, 2021, an increase of 2.4% compared to $33.4 million for the same period in 2020. From a product perspective, the net increase was due to increased sales of Fenofibrate, Potassium Citrate Extended Release, Vancomycin Oral Solution, and the second quarter 2021 launch of Nicardipine. These increases were somewhat tempered by declines in sales of Methazolamide, Miglustat, Penicillamine, and Mixed Amphetamine Salts.

Net revenues for branded pharmaceutical products were $11.0 million during the three months ended June 30, 2021, an increase of 3.8% compared to $10.6 million for the same period in 2020. The increase primarily reflects the launch of the products acquired in the Sandoz, Inc. acquisition in the second quarter of 2021 and increased sales of InnoPran XL. These increases were tempered by decreased revenues of Atacand and Arimidex.

Contract manufacturing revenues were $2.3 million during the three months ended June 30, 2021, a decrease of 19.9% compared to $2.9 million for the same period in 2020, due to a decreased volume of orders from contract manufacturing customers in the period.

Royalty and other revenues were $1.1 million during the three months ended June 30, 2021, a decrease of $0.4 million from $1.5 million for the same period in 2020, primarily due to decreases in product development revenues earned by ANI Canada and a the non-recurrence of royalty revenue related to Yescarta. These decreases were tempered by licensing revenues earned during the three months ended June 30, 2021.

Operating expenses increased by 7.4% to $64.2 million for the three months ended June 30, 2021, from $59.8 million in the prior year period.

Cost of sales, excluding depreciation and amortization, increased by $1.6 million to $22.3 million in the second quarter of 2021 from prior year period, primarily as a result of increased volumes in the current year period. The increase was tempered by a $1.2 million decrease related to a decrease in sales of products subject to profit sharing arrangements.

Research and development expenses decreased to $2.8 million in the second quarter of 2021 from $3.0 million in the second quarter of 2020, primarily due to the non-recurrence of $0.4 million of 2020 severance related expense associated with the restructuring of our internal Cortrophin development team.

Selling, general and administrative expenses decreased by $2.4 million in the second quarter of 2021 to $18.8 million compared to $21.2 million in the comparable quarter in 2020. The decrease primarily reflects the non-recurrence of $6.5 million of termination benefit expenses related to the 2020 departure of the Company’s former President and CEO. The Company also incurred recruitment and related legal charges associated with the CEO search in the second quarter 2020. These decreases were offset by $1.7 million of transaction expenses related to the pending Novitium acquisition and $2.5 million in sales and marketing expenses related to Cortrophin pre-launch activities incurred during the three months ended June 30, 2021.

On August 3, 2021, the Company entered into a Settlement Agreement with Arbor Pharmaceuticals, LLC to resolve all claims related to a civil proceeding which was pending trial later this month. Under the terms of the agreement, ANI will pay Arbor $8.4 million and Arbor will dismiss all claims against ANI. Neither party admitted wrongdoing in reaching this settlement. The Company recorded an $8.4 million charge to the second quarter Statement of Operations and will pay the settlement from cash on the balance sheet.

Depreciation and amortization increased by 1.1% in the second quarter of 2021 to $11.3 million from $11.2 million in the comparable quarter in 2020, primarily due to the amortization of the NDAs acquired in April 2021 from Sandoz Inc., partially offset by assets that became fully amortized in 2020.

Net loss for the second quarter of 2021 was $14.1 million as compared to net loss of $12.3 million in the prior year period. Diluted loss per share for the three months ended June 30, 2021 was ($1.17), compared to diluted loss per share of ($1.03) in the prior year period.

Adjusted non-GAAP diluted earnings per share was $0.67 in the second quarter of 2021 compared to $0.69 in the second quarter of 2020.

For reconciliations of adjusted non-GAAP EBITDA and adjusted non-GAAP diluted earnings per share to the most directly comparable GAAP financial measure, please see Table 3 and Table 4, respectively.

Liquidity

As of June 30, 2021, the Company had $24.2 million in unrestricted cash and cash equivalents plus $92.6 million in net accounts receivable. The Company had $205.7 million (face value) in outstanding debt as of June 30, 2021.

Conference Call

As previously announced, ANI Pharmaceuticals management will host its second quarter 2021 conference call as follows:

Date Friday, August 6, 2021
Time 8:30 a.m. ET
Toll free (U.S.) (866) 342-8591

Webcast (live and replay) www.anipharmaceuticals.com, under the "Investors" section
A replay of the conference call will be available within two hours of the call’s completion and will remain accessible for one week by dialing 800-695-0974 and entering access code 5412658.

Non-GAAP Financial Measures

Adjusted non-GAAP EBITDA

ANI’s management considers adjusted non-GAAP EBITDA to be an important financial indicator of ANI’s operating performance, providing investors and analysts with a useful measure of operating results unaffected by non-cash stock-based compensation and differences in capital structures, tax structures, capital investment cycles, ages of related assets, and compensation structures among otherwise comparable companies. Management uses adjusted non-GAAP EBITDA when analyzing Company performance.

Adjusted non-GAAP EBITDA is defined as net income, excluding tax expense or benefit, interest expense, (net), other expense, (net), depreciation, amortization, the excess of fair value over cost of acquired inventory, non-cash stock-based compensation expense, expense from acquired in-process research and development, Novitium transaction expenses, Cortrophin pre-launch charges, asset impairments, legal settlement expense, and certain other items that vary in frequency and impact on ANI’s results of operations. Adjusted non-GAAP EBITDA should be considered in addition to, but not in lieu of, net income or loss reported under GAAP. A reconciliation of adjusted non-GAAP EBITDA to the most directly comparable GAAP financial measure is provided below.

Adjusted non-GAAP Net Income

ANI’s management considers adjusted non-GAAP net income to be an important financial indicator of ANI’s operating performance, providing investors and analysts with a useful measure of operating results unaffected by the excess of fair value over cost of acquired inventory sold, non-cash stock-based compensation, non-cash interest expense, depreciation and amortization, Cortrophin pre-launch charges, acquired in-process research and development ("IPR&D") expense, Novitium transaction expenses, asset impairments, legal settlement expense, and certain other items that vary in frequency and impact on ANI’s results of operations. Management uses adjusted non-GAAP net income when analyzing Company performance.

Adjusted non-GAAP net income is defined as net income, plus the excess of fair value over cost of acquired inventory sold, non-cash stock-based compensation expense, Novitium transaction expenses, non-cash interest expense, depreciation and amortization expense, expense from acquired in-process research and development, Cortrophin pre-launch charges, asset impairments, legal settlement expense, and certain other items that vary in frequency and impact on ANI’s results of operations, less the tax impact of these adjustments calculated using an estimated statutory tax rate. Management will continually analyze this metric and may include additional adjustments in the calculation in order to provide further understanding of ANI’s results. Adjusted non-GAAP net income should be considered in addition to, but not in lieu of, net income reported under GAAP. A reconciliation of adjusted non-GAAP net income to the most directly comparable GAAP financial measure is provided below.

Adjusted non-GAAP Diluted Earnings per Share

ANI’s management considers adjusted non-GAAP diluted earnings per share to be an important financial indicator of ANI’s operating performance, providing investors and analysts with a useful measure of operating results unaffected by the excess of fair value over cost of acquired inventory sold, non-cash stock-based compensation, non-cash interest expense, depreciation and amortization, Cortrophin pre-launch charges, acquired IPR&D expense, Novitium transaction expenses, asset impairments, legal settlement expense, and certain other items that vary in frequency and impact on ANI’s results of operations. Management uses adjusted non-GAAP diluted earnings per share when analyzing Company performance.

Adjusted non-GAAP diluted earnings per share is defined as adjusted non-GAAP net income, as defined above, divided by the diluted weighted average shares outstanding during the period. Management will continually analyze this metric and may include additional adjustments in the calculation in order to provide further understanding of ANI’s results. Adjusted non-GAAP diluted earnings per share should be considered in addition to, but not in lieu of, diluted earnings or loss per share reported under GAAP. A reconciliation of adjusted non-GAAP diluted earnings per share to the most directly comparable GAAP financial measure is provided below.

On August 6, 2021 Spectrum Pharmaceuticals (NasdaqGS: SPPI), a biopharmaceutical company focused on novel and targeted oncology therapies, reported receipt of a Complete Response Letter (CRL) from the U.S. Food and Drug Administration (FDA) regarding the company’s Biologics License Application (BLA) for ROLONTIS (eflapegrastim). The CRL cited deficiencies related to manufacturing and indicated that a reinspection will be necessary. The company is seeking further clarification from the FDA and plans to meet with the agency as soon as possible.

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"We are disappointed with this outcome and look forward to fully understanding the remediation timelines for the program," said Joe Turgeon, President and CEO of Spectrum Pharmaceuticals. "We continue to believe in ROLONTIS and plan to diligently complete the regulatory process to bring ROLONTIS to market."

About ROLONTIS

ROLONTIS is a novel, long-acting granulocyte colony-stimulating factor (G-CSF) seeking an indication for the treatment of neutropenia in patients receiving myelosuppressive anti-cancer drugs. The BLA for ROLONTIS is supported by data from two identically designed Phase 3 clinical trials, ADVANCE and RECOVER, which evaluated the safety and efficacy of ROLONTIS in 643 early-stage breast cancer patients for the treatment of neutropenia due to myelosuppressive chemotherapy. In both studies, ROLONTIS demonstrated the pre-specified hypothesis of non-inferiority (NI) in duration of severe neutropenia (DSN) and a similar safety profile to pegfilgrastim. ROLONTIS also demonstrated non-inferiority to pegfilgrastim in the DSN across all 4 cycles (all NI p<0.0001) in both trials.

On August 6, 2021 Oncolytics Biotech Inc. (NASDAQ: ONCY) (TSX: ONC) reported its financial results and development highlights for the quarter ended June 30, 2021 (Press release, Oncolytics Biotech, AUG 6, 2021, View Source [SID1234586026]). All dollar amounts are expressed in Canadian currency unless otherwise noted.

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"Our second quarter accomplishments have advanced our lead clinical breast cancer program down a clear path towards a registrational study and substantially de-risked our broader clinical pipeline," said Dr. Matt Coffey, President and Chief Executive Officer of Oncolytics Biotech Inc. "Clinical AWARE-1 data show that pelareorep is an immunotherapeutic agent that synergistically combines with checkpoint inhibitors. These findings support the statistically significant overall survival benefit observed in our prior phase 2 breast cancer trial, achieving a key regulatory objective. They also suggest that pelareorep’s efficacy can be further enhanced by combining it with checkpoint inhibition. We are currently working to confirm this hypothesis in the BRACELET-1 breast cancer trial, which will support pelareorep’s advancement to a registrational study."

Dr. Coffey continued, "Beyond our lead program, we also presented clinical proof-of-concept data in pancreatic cancer that further demonstrate pelareorep’s immunologic mechanism of action and potential to address unmet needs across multiple indications. Together with AWARE-1 data, these results support our ongoing trials evaluating pelareorep-checkpoint inhibitor combinations and highlight pelareorep’s potential as an enabling technology for multiple classes of immunotherapeutic agents. Looking forward, our strong financial foundation leaves us well-positioned to build on this momentum and advance pelareorep’s clinical development. As we work towards this goal, we will remain primarily focused on breast cancer and our stated clinical milestones while pursuing a partnership strategy to further broaden pelareorep’s potential impact."

Second Quarter and Subsequent Highlights

Breast Cancer Program

Achieved primary endpoint in AWARE-1 study

Data from the twenty HR+/HER2- early-stage breast cancer patients included in AWARE-1’s first two cohorts were presented in an electronic poster at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting 2021 (link to PR; link to poster). Results from these patients, who were treated with pelareorep and letrozole without (cohort 1) or with (cohort 2) the PD-L1 inhibitor atezolizumab (Tecentriq), showed that that pelareorep and letrozole treatment upregulated tumor PD-L1 expression, induced the generation and expansion of T cell clones, promoted tumor infiltration of CD8+ T cells, and increased CelTIL score, a measure of tumor cellularity and inflammation that is significantly correlated with event-free and overall survival. These desirable effects were further enhanced in patients receiving atezolizumab, demonstrating that pelareorep and atezolizumab synergistically combine to generate an anti-cancer immune response in the tumor and peripheral blood. Notably, cohort 2 met the pre-specified success criteria for the study’s primary endpoint, with six of ten patients achieving at least a 30% increase in CelTIL score following treatment. Together, these data support the results of a prior successful phase 2 trial (IND-213) that showed a statistically significant near doubling of overall survival with pelareorep treatment. This supports the clinical rationale behind the phase 2 BRACELET-1 trial: Evaluating the safety and efficacy of pelareorep and chemotherapy alone, and in combination with a PD-L1 inhibitor, in HR+/HER2- breast cancer patients.

Gastrointestinal Cancers Program

Phase 2 data demonstrating clinical proof-of-concept for pelareorep-checkpoint inhibitor combination therapy in pancreatic cancer

Data from a phase 2 trial evaluating pelareorep in combination with the PD-1 inhibitor pembrolizumab (KEYTRUDA) in pancreatic adenocarcinoma patients who progressed after first-line treatment were featured in an electronic poster presentation at the 2021 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting (link to PR; link to poster). Findings from the trial indicate that pelareorep and pembrolizumab synergize and show anti-cancer activity in these difficult-to-treat patients, with a 42% disease control rate achieved and durations of control ranging from approximately 2.5 months to approximately 7 months despite the absence of chemotherapy in the treatment regimen. Biomarker data showed that patients achieving disease control had increased activation of anti-cancer CD8+ T cells in the peripheral blood, and reduced levels of pro-tumor Treg cells in the peripheral blood and tumor compared to those with progressive disease. These results, which are consistent with what has been seen in clinical trials in other indications, such as breast cancer, highlight the broad applicability of pelareorep’s immunotherapeutic mechanism of action. They also bode well for a successful outcome in the phase 1/2 GOBLET trial, which includes a cohort evaluating pelareorep and the PD-L1 inhibitor atezolizumab in combination with chemotherapy as a first-line treatment in metastatic pancreatic cancer patients (link to PR).

Additional Immunotherapeutic Combinations and Opportunities

Preclinical data highlighting pelareorep’s ability to synergize with multiple classes of anti-cancer agents

Data presented in two electronic poster presentations at the AACR (Free AACR Whitepaper) Annual Meeting 2021 showed that pelareorep enhanced the anti-tumor efficacy of the poly(ADP)-ribose polymerase 1 (PARP-1) inhibitor talazoparib and the cyclin-dependent kinase (CDK) 4/6 inhibitor palbociclib, which are both FDA approved for the treatment of breast cancer. The observed synergistic effects were notably mediated through immunologic mechanisms rather than through the molecular pathways typically associated with PARP-1 and CDK4/6 inhibition (link to PR; link to CDK4/6 poster; link to PARP-1 poster). Together, these results suggest that pelareorep may enhance the therapeutic potential of PARP-1 and CDK4/6 inhibitors by expanding the mechanisms by which they exert anti-tumor effects.

Changes to the Board of Directors

William G. Rice, Ph.D. has stepped down from Oncolytics Biotech’s Board of Directors to avoid any potential conflicts that might arise from the development of pelareorep with molecules being developed by Aptose Biosciences Inc., the company for which Dr. Rice serves as Chairman of the Board, President & Chief Executive Officer. "I’m a staunch supporter of Oncolytics and wish to express my sincere gratitude for the time serving the Board and working with a wonderful group of directors and officers," stated Dr. Rice. Oncolytics would like to thank Dr. Rice for his guidance during his tenure as a member of the Board.

Financial Highlights

As of June 30, 2021, the Company reported $50.8 million in cash and cash equivalents. The Company raised $8.1 million during the second quarter through issuing of common stock through its ATM facility.
Operating expense for the second quarter of 2021 was $3.5 million, compared to $3.0 million in the second quarter of 2020.
R&D expense for the second quarter of 2021 was $3.2 million, compared to $2.5 million in the second quarter of 2020.
Net cash used in operating activities for the second quarter of 2021 was $6.8 million, compared to $6.3 million for the second quarter of 2020.
The net loss for the second quarter of 2021 was $7.2 million, compared to a net loss of $6.8 million in the second quarter of 2020. The basic and diluted loss per share was $0.13 in the second quarter of 2021, compared to a basic and diluted loss per share of $0.17 in the second quarter of 2020.
Anticipated Milestones and Catalysts

Dosing of the first patient in phase 1/2 GOBLET study in gastrointestinal cancer: H2 2021
Final biomarker data for AWARE-1 breast cancer study in the intended target population for a registrational study: H2 2021
Completion of enrollment in phase 2 BRACELET-1 metastatic breast cancer study: Q4 2021
Interim safety update from phase 2 IRENE study in triple-negative breast cancer: Q4 2021*
Interim safety data from phase 1 WINSHIP 4398-18 multiple myeloma study: Q4 2021*
*Guidance provided by clinical investigators

Oncolytics expects to provide updates on the timing of the following milestones:

Interim safety update from BRACELET-1 metastatic breast cancer study
Phase 2 BRACELET-1 metastatic breast cancer study: final data
Webcast and Conference Call

Management will host a conference call for analysts and institutional investors at 8:00 a.m. ET today, August 6, 2021. To access the call, please dial (888) 664-6383 (North America) or (416) 764-8650 (International) and, if needed, provide confirmation number 5114-8191. A live webcast of the call will also be available by clicking here or on the Investor Relations page of Oncolytics’ website (LINK) and will be archived for three months. A dial-in replay will be available for one week and can be accessed by dialing (888) 390-0541 (North America) or (416) 764-8677 (International) and using reference code: 148-191#.

About AWARE-1

AWARE-1 is an open label window-of-opportunity study in early-stage breast cancer enrolling 38 patients into five cohorts:

Cohort 1 (n=10), HR+ / HER2- (pelareorep + letrozole)
Cohort 2 (n=10), HR+ / HER2- (pelareorep + letrozole + atezolizumab)
Cohort 3 (n=6), TNBC (pelareorep + atezolizumab)
Cohort 4 (n=6), HR+ / HER2+ (pelareorep + trastuzumab + atezolizumab)
Cohort 5 (n=6), HR- / HER2+ (pelareorep + trastuzumab + atezolizumab)
The study combines pelareorep, without or with atezolizumab, and the standard of care therapy according to breast cancer subtype. Tumor tissue is collected from patients as part of their initial breast cancer diagnosis, again on day three following initial treatment, and finally at three weeks following treatment, on the day of their mastectomy. Data generated from this study are intended to confirm that pelareorep is acting as a novel immunotherapy, to evaluate potential synergy between pelareorep and checkpoint blockade, and to provide comprehensive biomarker data by breast cancer subtype. The primary endpoint of the study is overall CelTIL score (a measurement of cellularity and tumor-infiltrating lymphocytes). Secondary endpoints for the study include CelTIL by breast cancer subtype, safety, and tumor and blood-based biomarkers.

For more information about the AWARE-1 study, refer to View Source

Tecentriq (atezolizumab) is a registered trademark of Genentech, a member of the Roche Group.

About BRACELET-1

The BRACELET-1(BReast cAnCEr with the Oncolytic Reovirus PeLareorEp in CombinaTion with anti- PD-L1 and Paclitaxel) study is an open-label, phase 2, randomized study in patients with HR+/HER2-, endocrine-refractory metastatic breast cancer being conducted under a co-development agreement with Merck KGaA, Darmstadt, Germany and Pfizer. PrECOG LLC, a leading cancer research network, is managing the study. The study will take place at 20 trial sites and is expected to enroll 45 patients randomized into three cohorts. A three-patient safety run-in was conducted with patients receiving pelareorep, paclitaxel, and avelumab prior to randomization. The three cohorts being treated are as follows:

Cohort 1 (n=15): paclitaxel
Cohort 2 (n=15): paclitaxel + pelareorep
Cohort 3 (n=18): paclitaxel + pelareorep + avelumab (Bavencio)
Patients in cohort 1 will receive paclitaxel on days 1, 8, and 15 of a 28-day cycle. Patients in cohort 2 will receive the same paclitaxel regimen as cohort 1, plus pelareorep on days 1, 2, 8, 9, 15 and 16 of the 28-day cycle. Patients in cohort 3 will receive the same combination and dosing regimen as cohort 2, plus avelumab on days 3 and 17 of the 28-day cycle. The primary endpoint of the study is overall response rate. Exploratory endpoints include peripheral and tumor T cell clonality, inflammatory markers, and safety and tolerability assessments.

For more information about the BRACELET-1 study, refer to View Source

About GOBLET

The GOBLET (Gastrointestinal tumOrs exploring the treatment comBinations with the oncolytic reovirus peLarEorep and anTi-PD-L1) study is a phase 1/2 multiple indication biomarker, safety, and efficacy study in advanced or metastatic gastrointestinal tumors. The study will be conducted at 15 centers in Germany. The primary endpoint of the study is safety, with overall response rate and biomarker evaluation (T cell clonality and CEACAM6) as exploratory endpoints. Approximately 55 patients are planned to be enrolled in four independent cohorts:

Pelareorep in combination with atezolizumab, gemcitabine, and nab-paclitaxel in 1st line metastatic pancreatic cancer patients (n=12);
Pelareorep in combination with atezolizumab in 1st line MSI (microsatellite instability)-high metastatic colorectal cancer patients(n=19);
Pelareorep in combination with atezolizumab and TAS-102 in 3rd line metastatic colorectal cancer patients (n=14); and
Pelareorep in combination with atezolizumab in 2nd line advanced and unresectable anal cancer patients (n=10).