On December 9, 2020 Veru Inc. (NASDAQ: VERU), an oncology biopharmaceutical company with a focus on developing novel medicines for the management of cancer, reported record net revenues and gross profit for its fiscal 2020 fourth quarter and full year ended September 30, 2020 (Press release, Veru, DEC 9, 2020, View Source [SID1234572505]).

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Fourth-Quarter Financial Highlights: Fiscal 2020 vs Fiscal 2019

Net revenues increased 35% to $11.7 million from $8.7 million
FC2 prescription net revenues climbed 87% to $8.7 million from $4.7 million
Gross profit rose 64% to $9.6 million from $5.8 million
Gross margin increased to 81% of net revenues from 67% of net revenues
Operating loss was $11.3 million, which includes a $14.1 million non-cash impairment charge related to intangible assets. Adjusted operating income, which excludes the non-cash impairment charge, was $2.8 million versus an operating loss of $1.5 million
Net loss, which includes the non-cash impairment charge, was $11.8 million, or $0.17 per share, compared with $3.1 million, or $0.05 per share
Full-Year Financial Highlights: Fiscal 2020 vs Fiscal 2019

Net revenues rose 34% to $42.6 million from $31.8 million
FC2 prescription sales climbed 93% to $27.1 million from $14.1 million
Gross profit rose 42% to $30.8 million from $21.7 million
Gross margin increased to 72% of net revenues from 68% of net revenues
Operating loss was $14.7 million, which included a $14.1 million non-cash impairment charge related to intangible assets. Adjusted operating loss, which excludes the non-cash impairment charge, narrowed to $0.6 million from $6.4 million
Net loss, which includes the non-cash impairment charge, was $19.0 million, or $0.28 per share, compared with $12.0 million, or $0.19 per share
"We reported stellar financial results for both the fiscal 2020 fourth quarter and full year largely driven by strong sales of our FC2 product," said Mitchell Steiner, M.D., Chairman, President and Chief Executive Officer. "In particular, prescription sales of FC2 sharply increased, helping to raise our gross margin in the recently completed fourth quarter to more than 81% of total net revenues. We anticipate further growth of prescription FC2 sales in the coming year."

Company Sells PREBOOST Business

The Company has completed the sale of its PREBOOST for the treatment of premature ejaculation business to Roman Health Ventures Inc. for $20 million in cash, consisting of $15 million paid at closing, $2.5 million payable 12 months after closing and $2.5 million payable 18 months after closing.

"Proceeds from the transaction, along with current cash and anticipated cash flow from operations, are expected to be sufficient to self-fund our existing drug product development program, without the need for a new equity financing, until at least the end of fiscal year 2022," said Dr. Steiner. "We plan to continue to generate robust growing revenues from our sexual health business which as a standalone business would be very valuable. Coming off a record year of $42.6 million in net revenues with a gross margin of 72%, and expecting another record year in fiscal year 2021, we could have options to monetize the business as we did with the PREBOOST business."

"Veru has evolved into a late clinical stage oncology drug development and commercialization company, having made excellent progress on our development program. Our multiple drug candidates continue to advance, and we are confident that we will achieve significant milestones in 2021. The Company expects it will have sufficient resources generated from our sexual health business and existing sources of cash to fund clinical development of all our registration clinical trials without the need for new equity financing through the end of fiscal year 2022."

Some Pharmaceutical Pipeline Recent Highlights:

The Company expects to issue a news release later today with a more detailed update on its pipeline of late clinical stage drug candidates including the in-licensing of a novel late clinical stage breast cancer drug product entering a Phase 3 clinical trial.

TADFYN (Tadalafil 5mg and Finasteride 5mg Combination Capsule) for the Treatment of Lower Urinary Tract Symptoms Caused by Benign Prostatic Hyperplasia (BPH)

The Company had a successful pre-NDA meeting with the FDA last year and the 12-month stability testing on three manufacturing / commercial batches required by the FDA is being completed. We expect to submit the NDA for TADFYN in the first quarter of calendar year 2021 and plan to launch, if approved, via telemedicine channels in late calendar year 2021.

VERU-111 for Metastatic Castration and Androgen Targeting Agent Resistant Prostate Cancer

In September, the Company announced that it had fully enrolled a Phase 2 clinical trial of VERU-111, its novel, oral, targeting alpha and beta tubulin of microtubules to disrupt the cytoskeleton (cytoskeleton disruptor for metastatic castration and androgen receptor targeting agent resistant prostate cancer. In both the Phase 1b study (n=39) and in the Phase 2 study (n=41), VERU-111 63mg oral daily continuous dosing for 21 day cycles has been well tolerated with no reports of neutropenia and neutrotoxicity and has demonstrated promising efficacy with evidence of PSA declines and objective and durable tumor responses. The Company has received input from the FDA and anticipates initiating a Phase 3 VERU-111 VERACITY registration clinical trial during the first quarter of calendar 2021.

VERU-100 Androgen Deprivation Therapy for Advanced Prostate Cancer

VERU100 is a long-acting GnRH antagonist peptide formulation administered as a small volume, three-month depot subcutaneous injection without a loading dose. There are no GnRH antagonist depot injectable formulations commercially approved beyond a one-month duration. The Company anticipates initiating a Phase 2 trial to evaluate VERU-100 dosing in the first quarter of calendar year 2021 and a Phase 3 registration clinical trial during the second half of calendar year 2021.

VERU-111 COVID-19: Phase 2 Clinical Trial

The Company is also developing VERU-111 for COVID-19 patients at high risk for acute respiratory distress syndrome (ARDS). The drug’s dual antiviral and anti-inflammatory action has the potential to broadly treat the cytokine storm associated with high COVID-19 mortality rates. The Company is close to completing enrollment of a Phase 2 clinical trial to assess the efficacy of VERU-111 in combating COVID-19 in patients at high risk for ARDS.

Impairment Charge

During the fourth quarter the Company took a one-time, non-cash impairment charge of $14.1 million related to in process research and development associated with the financial accounting for the Aspen Park Pharmaceuticals, Inc. acquisition, all as further described in the Company’s Form 10-K for the fiscal year ended September 30, 2020. The non-cash charge is primarily related to the Company’s decision to prioritize clinical development for late clinical stage oncology drug development candidates with greater market differentiation, larger markets, and higher profit potential.

Non-GAAP Financial Information

Certain financial results for fiscal years 2020 and 2019 are presented on both a reported and a non-GAAP, adjusted basis. Reported results were prepared in accordance with U.S. GAAP and include all revenue and expenses recognized during the period. The non-GAAP results are adjusted to exclude the one-time, non-cash impairment charge in the fourth quarter of fiscal year 2020. Management believes non-GAAP financial measures provide useful information to investors regarding the Company’s results of operations and assist management, analysts, and investors in evaluating the performance of the Company’s business. Non-GAAP financial measures should be considered in addition to, and not as a substitute for, measures of financial performance prepared in accordance with GAAP. The Company has reconciled these non-GAAP financial measures to the nearest reported GAAP measures in the reconciliation table below.

Event Details
Veru Inc. will host a conference call today at 8 a.m. ET to review the Company’s performance. Interested investors may access the call by dialing 800-341-1602 from the U.S. or 412-902-6706 from outside the U.S. and asking to be joined into the Veru Inc. call. The call will also be available through a live, listen-only audio broadcast via the Internet at www.verupharma.com. A playback of the call will be archived and accessible on the same website for at least three months. A telephonic replay of the conference call will be available, beginning the same day at approximately 12 p.m. (noon) ET by dialing 877-344-7529 for U.S. callers, or 412-317-0088 from outside the U.S., passcode 10149625, for one week.

The Company does not expect to update the guidance provided above regarding its expectation that it will not need a new equity financing. The Company notes that the statements of future performance made in this release are based upon current expectations and are subject to factors that could cause actual results to differ materially from those suggested here, including those factors set forth in the "Safe Harbor" Statement below.

On December 9, 2020 Oncopeptides AB (publ) (Nasdaq Stockholm: ONCO), a pharmaceutical company focused on the development of targeted therapies for difficult-to-treat hematological diseases, reported that the pivotal phase 2 HORIZON study evaluating intravenous melflufen (INN melphalan flufenamide) in combination with dexamethasone in relapsed refractory multiple myeloma, has been published in the peer-reviewed Journal of Clinical Oncology (Press release, Oncopeptides, DEC 9, 2020, View Source [SID1234572521]).

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The phase 2 HORIZON data are the basis for the ongoing priority review of the New Drug Application to the US Food and Drug Administration FDA, for accelerated approval of melflufen in combination with dexamethasone in triple-class refractory multiple myeloma patients, who are refractory to at least one proteasome inhibitor, one immunomodulatory drug and one anti-CD38 monoclonal antibody.

"The results from the HORIZON study demonstrate that melflufen in combination with dexamethasone, has a potential to provide a therapeutic option for patients who are difficult to treat and have a poor prognosis, including patients with triple class refractory myeloma and patients with extramedullary disease", says Klaas Bakker, MD, PhD, Chief Medical Officer, Oncopeptides AB. "These patients have limited, or no treatment options left. The introduction of a new treatment class may represent a potentially important alternative".

The phase 2 HORIZON study is a pivotal, single-arm, multicenter, phase 2 study evaluating the safety and efficacy of melflufen in combination with dexamethasone in patients with relapsed refractory multiple myeloma. The study included 157 heavily pretreated patients, who had received >2 earlier lines of therapy with immunomodulatory drugs and proteasome inhibitors and were refractory to pomalidomide and/or daratumumab. The HORIZON study population includes subgroups of patients who were triple?class refractory and/or had extramedullary disease and/or had cytogenetic high?risk features.

Summary of results:

30 Intention to Treat (n=157) Triple Class Refractory (n=119) Extra Medullary Disease (n=55)
Overall Response Rate (ORR) 29% 26% 24%
Median Progression Free Survival (PFS)) 4.2 months 3.9 months 2.9 months
Median Overall Survival (OS) 11.6 months 11.2 months 6.5 months
Responding patients n=45 n=31 n=13
Median Duration of Response (DOR) 5.5 months 4.4 months 5.5 months
Median Progression Free Survival (PFS) 8.5 months 8.5 months 17.3 months
The publication is available on; View Source

The information in this press release was submitted for publication on December 9, 2020 at 22:00 (CET).

About melflufen
Melflufen (INN melphalan flufenamide) is a first in class peptide-drug conjugate (PDC) that targets aminopeptidases and rapidly releases alkylating agents into tumor cells. Melflufen is rapidly taken up by myeloma cells due to its high lipophilicity and is immediately hydrolyzed by peptidases to release an entrapped hydrophilic alkylator payload. Aminopeptidases are overexpressed in tumor cells and are even more pronounced in advanced cancers and tumors with a high mutational burden. In vitro, melflufen is 50-fold more potent in myeloma cells than the alkylator payload itself due to the increased intracellular alkylator concentration. Melflufen displays cytotoxic activity against myeloma cell lines resistant to other treatments, including alkylators, and has also demonstrated inhibition of DNA repair induction and angiogenesis in preclinical studies. In the pivotal phase 2 HORIZON study melflufen plus dexamethasone demonstrated encouraging efficacy and a clinically manageable safety profile in heavily pretreated patients with relapsed refractory multiple myeloma, with primarily hematologic Adverse Events (AE) and a low incidence of non-hematologic AEs.

On December 9, 2020 Lantheus Holdings, Inc. (NASDAQ: LNTH) (the Company), the parent company of Lantheus Medical Imaging, Inc. and Progenics Pharmaceuticals, Inc., and a global leader in the development, manufacture and commercialization of innovative diagnostic and therapeutic agents and products, reported that the U.S. Food and Drug Administration (FDA) has accepted the New Drug Application (NDA) for PyLTM (18F-DCFPyL), a prostate specific membrane antigen (PSMA)-targeted positron emission tomography (PET) imaging agent for prostate cancer (Press release, Lantheus Medical Imaging, DEC 9, 2020, View Source [SID1234572540]).

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The FDA granted Priority Review for the PyL NDA and assigned a Prescription Drug User Fee Act (PDUFA) action date of May 28, 2021. The FDA has also indicated in the NDA filing acceptance notification that it is not currently planning to hold an advisory committee meeting to discuss the application.

"We are pleased that the FDA has accepted our PyL NDA for review and granted our application Priority Review, which is a significant milestone for Lantheus. We believe that there is a significant unmet need for reliable, targeted imaging in prostate cancer, particularly in the high risk and biochemically recurrent populations," said Istvan Molnar, MD, Chief Medical Officer of Lantheus. "We look forward to working with the FDA during the NDA review process with the goal of bringing PyL to patients and physicians who need it."

The PyL NDA is supported by data from two Company-sponsored pivotal studies (OSPREY and CONDOR) designed to establish the safety and diagnostic performance of PyL imaging across the prostate cancer disease continuum. Results from OSPREY Cohort A demonstrated improvement in specificity and positive predictive value (PPV) of PyL PET imaging over conventional imaging in men with high risk prostate cancer. OSPREY Cohort B and CONDOR studied men with prostate cancer in various disease states, including biochemical recurrent, hormone sensitive, non-metastatic castrate resistant, and metastatic castrate resistant. OSPREY Cohort B demonstrated the sensitivity of PyL PET imaging in detecting metastatic lesions, while CONDOR, in patients with biochemical recurrent prostate cancer and non-informative baseline findings, demonstrated PyL’s high correct localization rate and detection rate, including in patients with low PSA values. In the CONDOR study, 63.9% of patients had a change in intended disease management plans due to the PyL PET imaging results. We believe the results from these two studies, taken as a whole, demonstrate the ability of PyL to reliably detect and localize disease and could enable more appropriate patient management.

PyL has been administered in approximately 3,500 subjects globally, including the two Company-sponsored pivotal studies, multiple investigator sponsored studies, as well as clinical use reported in the literature. Across these studies, PyL has shown an attractive safety profile.

About PyL for PET Imaging of Prostate Cancer

PyL (also known as 18F-DCFPyL) is an investigational fluorinated PSMA-targeted PET imaging agent that enables visualization of localized prostate cancer as well as bone and soft tissue metastases to determine the presence or absence of recurrent and/or metastatic prostate cancer.

About OSPREY

The Phase 2/3 OSPREY trial assessed the diagnostic performance of PyL to detect prostate cancer in pelvic lymph nodes in subjects with high risk, locally advanced prostate cancer (Cohort A) and distant metastases in subjects with metastatic or recurrent prostate cancer (Cohort B). In the trial, the diagnostic performance of PyL in detecting disease in pelvic lymph nodes (Cohort A) showed specificity of 96-99%, sensitivity of 31-42%, and PPV of 78-91% although the trial did not meet one of its the primary endpoints. In the metastatic or recurrent prostate cancer setting (Cohort B), PyL exhibited sensitivity of 93-99% and PPV of 81-88% in detecting metastatic lesions. Overall, PyL demonstrated high diagnostic performance in reliably detecting nodal and distant metastatic prostate cancer.

About CONDOR

The Phase 3 CONDOR trial evaluated the diagnostic performance and clinical impact of PyL in men with biochemical recurrence of prostate cancer and uninformative baseline imaging based on conventional modalities. The CONDOR trial achieved its primary endpoint, with a correct localization rate (CLR) of 84.8% to 87.0% among the three blinded independent readers (the lower bound of the 95% confidence intervals ranging from 77.8% to 80.4%). CLR is based on positive predictive value, defined as the percentage of subjects with a one-to-one correspondence between localization of at least one lesion identified on PyL PET/CT and a composite truth standard comprised of histopathology, conventional imaging and/or changes in PSA levels following radiation therapy. 63.9% of subjects in the CONDOR trial had a change in intended disease management plans due to PyL imaging results, a key secondary endpoint of the trial. The changes to treatment management plans due to the PyL results included salvage local therapy to systemic therapy, observation to initiating therapy, noncurative systemic therapy to salvage local therapy, and planned treatment to observation.

About Prostate Cancer

Prostate cancer is the second most common form of cancer affecting men in the United States — an estimated one in nine men will be diagnosed with prostate cancer in his lifetime. The American Cancer Society estimates that each year 192,000 new cases of prostate cancer will be diagnosed, and 33,000 men will die of the disease. Approximately 3.2 million men in the United States currently count themselves among prostate cancer survivors.1

On December 9, 2020 Exact Sciences Corp. (NASDAQ: EXAS) reported that data from the Rx for Positive Node, Endocrine Responsive Breast Cancer, or RxPONDER, trial successfully defined the benefit of chemotherapy in early-stage, node-positive breast cancer patients with Oncotype DX Breast Recurrence Score results of 0 to 25. First results from the study, led by the independent SWOG Cancer Research Network, and sponsored by the National Cancer Institute (NCI), identified the majority of women with 1-3 positive nodes who received no benefit from chemotherapy (Press release, Exact Sciences, DEC 9, 2020, View Source [SID1234572556]).i The data will be presented on December 10 at the 2020 San Antonio Breast Cancer Symposium (SABCS).

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RxPONDER showed a different effect of chemotherapy based on Recurrence Score results for postmenopausal and premenopausal women. Postmenopausal women with Recurrence Score results 0-25 were not observed to show benefit from chemotherapy and may avoid the associated side effects of the treatment. Importantly, no chemotherapy benefit was observed regardless of the number of affected nodes, tumor grade, or size. Two-thirds of the women in the trial were postmenopausal.

The first results also demonstrated, after a median of five years of follow-up, that premenopausal women with Recurrence Score results 0-25 were observed to have a statistically significant chemotherapy benefit, with an average improvement in distant recurrence rates at 5 years of 3%.

Approximately 85% of women with node- positive disease have Recurrence Score results of 0 to 25. ii Postmenopausal and premenopausal women with Recurrence Score results 26-100 were not included in the study because investigators reviewed prior studies and determined that this patient group had chemotherapy benefit. The SWOG investigators intend to publish the detailed RxPONDER results in a peer-reviewed publication.

"Every day in clinics around the world, physicians wrestle with the question of how to best treat women with this common form of breast cancer," said study lead author Kevin Kalinsky, MD, a long-time SWOG investigator and director of the Glenn Family Breast Center at the Winship Cancer Institute of Emory University. "These results are practice changing and demonstrate that the great majority of postmenopausal women can be spared unnecessary chemotherapy and receive only hormone therapy. This should bring more clarity to physicians and some relief for patients."

Approximately 25% of patients diagnosed with hormone receptor (HR)-positive, HER2-negative early breast cancer have tumor that has spread to their lymph nodes and two out of three are postmenopausal.iii The vast majority of these patients currently receive chemotherapy.iv

"With the RxPONDER and TAILORx trials, there is now definitive and undeniable clarity on who does and who does not benefit from chemotherapy among early-stage breast cancer patients, with either node-negative or node positive disease," said Steven Shak, MD, chief medical officer at Exact Sciences. "These long-awaited results, which continue to build on the body of evidence supporting the role of the Oncotype DX test in shaping clinical practice, are estimated to impact tens of thousands of women worldwide."

One of the largest clinical trials in women with node-positive HR+, HER2- early breast cancer, RxPONDER is a prospective, randomized Phase III study conducted at 632 sites in nine countries – the United States, Canada, Mexico, Colombia, Ireland, France, Spain, South Korea, and Saudi Arabia. The study enrolled more than 5,000 women with up to three positive nodes. Women with a Recurrence Score result 0-25 were randomized for treatment with hormone therapy alone or chemotherapy followed by hormone therapy. Randomized patients were stratified based on their Recurrence Score result, menopausal status, and the type of lymph node surgery.

The use of the Oncotype DX test in early-stage breast cancer is supported by prospective outcomes from more than 17,000 patients with node-positive disease and more than 83,000 patients with node-negative disease, including the TAILORx study. Results from TAILORx, published in 2018, showed that the Oncotype DX test identifies the vast majority of women with node-negative disease who receive no substantial benefit from chemotherapy (approximately 80%), as well as the important minority for whom chemotherapy can be life-saving.

About Oncotype DX
The Oncotype DX portfolio of breast, colon and prostate cancer tests applies advanced genomic science to reveal the unique biology of a tumor in order to optimize cancer treatment decisions. In breast cancer, the Oncotype DX Breast Recurrence Score test is the only test that has been shown to predict the likelihood of chemotherapy benefit as well as recurrence in invasive breast cancer. Additionally, the Oncotype DX Breast DCIS Score test predicts the likelihood of recurrence in a pre-invasive form of breast cancer called DCIS. In prostate cancer, the Oncotype DX Genomic Prostate Score test predicts disease aggressiveness and further clarifies the current and future risk of the cancer prior to treatment intervention, and the Oncotype DX AR-V7 Nucleus Detect test helps determine which patients with metastatic castration-resistant prostate cancer (mCRPC) are resistant to androgen receptor (AR)-targeted therapies. The Oncotype DX AR-V7 Nucleus Detect test is performed by Epic Sciences at its centralized, CLIA-certified laboratory in San Diego and offered exclusively by Exact Sciences. With more than 1 million patients tested in more than 90 countries, the Oncotype DX tests have redefined personalized medicine by making genomics a critical part of cancer diagnosis and treatment. To learn more about Oncotype DX tests, visit www.OncotypeIQ.com, www.MyBreastCancerTreatment.org or www.MyProstateCancerTreatment.org.

On December 9, 2020 Enzo Biochem, Inc. (NYSE:ENZ), a leading biosciences and diagnostics company, reported financial results for the first quarter ended October 31, 2020 and provided a business update on recent corporate and operational developments (Press release, Enzo Biochem, DEC 9, 2020, sec.gov/Archives/edgar/data/316253/000121390020042554/ea131605ex99-1_enzobio.htm [SID1234572813]).

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"During this quarter we exceeded guidance and achieved profitability based on strong results that reflect our strategy to both streamline our operations and expand our product and platform capabilities as an integrated solutions provider of products and services in molecular diagnostics, immunoassays, cytology, and immunohistochemistry," said Elazar Rabbani, PhD., Chairman and Chief Executive Officer of Enzo. "The rapid application of our proprietary GenFlex platform in response to the COVID-19 pandemic is the most recent reflection of the strength and flexibility of our molecular diagnostic capabilities. We have also worked aggressively to expand our operations to focus on more advanced, higher margin market opportunities that reflect the core strengths of Enzo and our team. Our portable microplate reader brings new potential capabilities in point-of-care testing to researchers and healthcare providers while our GoTestMeNow.com online portal represents a major step forward in bringing access to diagnostic testing directly to people who need it conveniently and quickly."

"During this very strong quarter for our company we also added two outstanding industry leaders to our Board of Directors. Drs. Mary Tagliaferri and Ian Walters significantly expand the operational and commercial expertise of our Company’s board, particularly concerning companion diagnostics and other therapeutic opportunities. We continue to execute on our strategy to position Enzo as a leading vertically integrated end–to-end diagnostic company capitalizing on our multi-platform technologies and products now and in a post-COVID-19 environment," said Barry Weiner, President of Enzo.

Operational Highlights:

The Company posted another successful quarter of progress in implementing its strategic plan as a fully integrated end-to-end diagnostic product and service provider while navigating through a range of operational issues during the COVID-19 pandemic. Our first responder staff’s response and commitment has been noteworthy in our achieving these goals.
Enzo rapidly expanded capacity in reagent and consumable supply manufacturing while broadening its menu of tests on its GenFlex molecular diagnostic platform.
The Company continued its strategic operational expansion program including plans to double its facility footprint in Farmingdale, NY.
Enzo completed the launch of the company’s new portable microplate reader for use with its ELISA and assay kits to simplify laboratory workflow and expand POC capabilities in molecular diagnostics.
In response to the continuing demand for improved access to molecular testing, Enzo introduced the GoTestMeNow online portal where consumers can directly order COVID-19 laboratory tests that are physician-approved, with plans to expand its use to other testing needs in 2021.
Customer interest for Enzo’s diagnostic platforms was strong following award of Emergency Use Authorization from the FDA highlighting the Company’s integrated in-house capabilities and ability to develop high throughput sensitive detection platforms. These platforms support rapid scalability of testing for COVID-19 in a model that can be applied to future testing needs in multiple areas including upper respiratory panels, STDs and expanded women’s health panels.
Corporate & Organizational Highlights:

Enzo added industry veterans Mary Tagliaferri, MD and Ian B. Walters, MD to the Company Board of Directors.
The Company planned and executed a range of operational and technological strategies to further its cost efficiencies.
The Company is in the process of evaluating various business opportunities concerning Enzo’s assets and capabilities for investment, partnerships, and commercial relationships.
Financial Highlights:

Following a slow-down of operations at the beginning of the COVID-19 pandemic as a result of a sharp industry-wide fall-off in medical visits and the closure of many customer facilities, Enzo monthly revenues have registered steady gains since April. Quarterly revenues advanced 47% sequentially and 42% year-over-year during the period.
The Company’s current annual revenue run-rate is approximately $115 million, representing more than 50% topline growth on an annualized basis.
Gross margins in the Enzo Clinical Labs division reached 39% in the first quarter.
1Q21 net income was $0.3 million compared to a net loss of $7.6 million in the previous year’s period, representing a $7.9 million improvement over the corresponding period a year ago and a $3.6 million improvement over the prior quarter.
First Quarter 2021 Financial Results

Total first quarter revenue was $28.7 million, compared to $20.2 million in the first quarter last year, an increase of 42%, reflecting continuing expansion of operations and revenue following the slow-down associated with the impact of COVID-19 on the diagnostic testing sector. Consolidated gross margin was 42% compared to 28% a year ago.
Enzo Clinical Lab revenue increased 66% to $21.2 million from $12.8 million in the first quarter 2020 and more than 55% sequentially. The year over year improvement was driven by volume growth to 300,000 accessions in the period versus approximately 200,000 in the previous year’s first quarter. Net revenue per accession increased to more than $69 per accession vs. $62 in the previous year’s period. Clinical services gross margin amounted to 39% up from 14% in the first quarter 2020, primarily due to testing mix as well as from ongoing cost-saving initiatives.
Enzo Life Sciences revenue of $7.4 million increased 27% from $5.8 million in the previous quarter reflecting the beginning of a recovery from the impact of COVID-19 pandemic globally. Gross margin was 49%, compared to 52% in the previous year’s quarter and 46% in the fourth quarter due to product mix and the impact of the COVID-19 pandemic.
Research and development expenses decreased 29% to $0.8 million (3% of total revenues) from $1.1 million, (5% of total revenues), in the year ago period. Selling, general and administrative expenses of $10.0 million (down to 35% of total revenue) declined from $11.1 million (55% of total revenue) in year ago period, 10% lower.
GAAP net income was $0.3 million or $0.01 per share versus a net loss of $3.3 million or ($0.07) per share last quarter and a loss of $7.7 million, or ($0.16) per share, in the year-ago quarter. Adjusted EBITDA in the quarter was $1.0 million compared to an adjusted EBITDA loss of $5.7 million in the previous year’s first quarter. The year-over-year improvement was driven mainly by an increase in gross margin (from COVID-19 testing and lower reagent costs) and lower SG&A expenses from headcount efficiencies, as well as reduced intangibles amortization and travel.
Cash and cash equivalents totaled $46 million at the end of the first quarter, slightly lower than the $48 at the end of the fiscal year due to increases in accounts receivable, inventory, and capital expenditures. Working capital improved to $37 million from $36 million at the end of the fiscal year. As of October 31, 2020, the Company had 47.9 million shares outstanding.
Conference Call and Webcast Information

The Company will host a conference call on Wednesday, December 9, 2020, at 4:30 pm, Eastern Standard Time, to review the operational, corporate, and financial highlights. To participate in the conference call, please dial the following numbers prior to the start of the call or click the webcast link below to participate over the internet:

Domestic: 877-407-0792
International: 201-689-8263
Conference ID: 13713236
Webcast: View Source

A replay of the call will be available via webcast for on-demand listening shortly after completion of the call on the Investor Relations section of the Company’s website, View Source, and will remain available for approximately 90 days. Please access the Company’s website at least 15 minutes ahead of the conference to register, download, and install any necessary audio software.

Adjusted Financial Measures

To comply with Regulation G promulgated pursuant to the Sarbanes-Oxley Act, Enzo Biochem attached to this news release and will post to the investor relations section of the Company’s website (View Source) any reconciliation of differences between GAAP and Adjusted financial information that may be required in connection with issuing the Company’s quarterly financial results.

The Company uses EBITDA as a measure of performance to demonstrate earnings exclusive of interest, taxes, depreciation and amortization. Adjustments to EBITDA are for items of a non-recurring nature and are reconciled on the table provided. The Company manages its business based on its operating cash flows. The Company, in its daily management of its business affairs and analysis of its monthly, quarterly and annual performance, makes its decisions based on cash flows, not on the amortization of assets obtained through historical activities. The Company, in managing its current and future affairs, cannot affect the amortization of the intangible assets to any material degree, and therefore uses EBITDA as its primary management guide. Since an outside investor may base its evaluation of the Company’s performance based on the Company’s net loss not its cash flows, there is a limitation to the EBITDA measurement. EBITDA is not, and should not be considered, an alternative to net loss, loss from operations, or any other measure for determining operating performance of liquidity, as determined under accounting principles generally accepted in the United States (GAAP). The most directly comparable GAAP reference in the Company’s case is the removal of interest, taxes, depreciation and amortization.

We refer you to the tables attached to this press release, which includes reconciliation tables of GAAP to Adjusted net income (loss) and EBITDA to Adjusted EBITDA.