On May 11, 2020 Fortress Biotech, Inc. (NASDAQ: FBIO) ("Fortress"), an innovative biopharmaceutical company, reported financial results and recent corporate highlights for the first quarter ended March 31, 2020 (Press release, Fortress Biotech, MAY 11, 2020, View Source [SID1234557515]).
Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:
Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing
Schedule Your 30 min Free Demo!
Lindsay A. Rosenwald, M.D., Fortress’ Chairman, President and Chief Executive Officer, said, "The first quarter of 2020 was another record revenue quarter for Fortress Biotech. Revenue from our dermatology products marketed by our partner company, Journey Medical Corporation, increased 95% compared to the first quarter of 2019, demonstrating the strength of our commercial operations. We intend to acquire one to two new prescription products this year."
Dr. Rosenwald continued, "We also made significant progress across our robust pipeline of development-stage product candidates in the first quarter. Notably, IV tramadol was assigned a PDUFA date of October 10, 2020. If IV tramadol is approved by the FDA and Avenue Therapeutics is acquired, we would expect to realize approximately $48 million, plus future contingent value rights. After a strong start to the year, we look forward to delivering key value-creating catalysts throughout the rest of 2020."
Recent Corporate Highlights1:
Marketed Dermatology Products
·Our dermatology products are marketed by our partner company, Journey Medical Corporation.
·Our five marketed specialty dermatology products generated first quarter 2020 net revenues of $11.9 million, compared to first quarter 2019 net revenues of $6.1 million, representing growth of 95% year-over-year.
·We intend to acquire one to two new prescription products in 2020.
IV Tramadol
·In February 2020, the U.S. Food and Drug Administration ("FDA") accepted the submission of Avenue Therapeutics’ New Drug Application ("NDA") for IV tramadol for review and assigned a Prescription Drug User Fee Act ("PDUFA") date of October 10, 2020. Pending a positive outcome resulting in FDA approval and other certain conditions being satisfied, a merger between Avenue and InvaGen will be completed shortly thereafter, which would result in a potential net distribution to Fortress of approximately $48 million and future contingent value rights.
1 Includes product candidates in development at Fortress, majority-owned and controlled partners and partners in which Fortress holds significant minority ownership positions. As used herein, the words "we", "us" and "our" may refer to Fortress individually or together with our affiliates and partners, as dictated by context.
·In April 2020, Avenue announced that two e-posters highlighting efficacy and safety results from its Phase 3 program are available for online viewing from the cancelled Annual Regional Anesthesiology and Acute Pain Medicine Meeting hosted by the American Society of Regional Anesthesia and Pain Medicine ("ASRA").
oThe e-poster (816) titled "Intravenous Tramadol is Effective in Management of Postoperative Pain Following Abdominoplasty: A 3-arm Randomized Controlled Trial" presents data from the Phase 3 abdominoplasty study and can be found here.
oThe e-poster (1001) titled "IV tramadol – A New Treatment Option for Management of Post-Operative Pain: A Safety Trial Including Various Types of Surgery" presents data from the Phase 3 safety study and can be found here.
·IV Tramadol is currently in development at our partner company, Avenue Therapeutics, Inc.
CUTX-101
·In January 2020, the FDA granted Rare Pediatric Disease Designation to CUTX-101 for the treatment of Menkes disease.
·We intend to begin the rolling submission of the NDA for CUTX-101 to the FDA in the fourth quarter of 2020.
·CUTX-101 is currently in development at our partner company, Cyprium Therapeutics, Inc.
CAEL-101
·In March 2020, Caelum Biosciences, Inc. ("Caelum") began dosing patients in its Phase 2 dose selection clinical trial of CAEL-101, a light chain fibril-reactive monoclonal antibody for the treatment of AL amyloidosis.
·Caelum expects to begin its pivotal Phase 3 program in the second half of 2020.
Cosibelimab (formerly CK-301, an anti-PD-L1 antibody)
·In January 2020, we announced confirmation of the registration path for cosibelimab in metastatic cutaneous squamous cell carcinoma ("CSCC"). FDA feedback supports the plan to submit a BLA based on data from the ongoing Phase 1 clinical trial. Over one-third of enrollment is complete in the cohort of patients with metastatic CSCC. There is potential for cosibelimab to be differentiated both clinically and as a lower-cost alternative to available anti-PD-1/L1 mAbs.
·In April 2020, we announced that the U.S. Patent and Trademark Office has issued a composition of matter patent for cosibelimab. U.S. Patent No. 10,590,199 specifically covers the antibody, cosibelimab, or a fragment thereof, providing protection through at least May 2038, exclusive of any additional patent-term extensions that might become available.
·We anticipate presenting additional cosibelimab data in the second half of 2020 and expect to complete enrollment of our registration-enabling Phase 1 clinical trial in CSCC in 2021.
·Cosibelimab is currently in development at our partner company, Checkpoint Therapeutics, Inc.
MB-107 (Lentiviral Gene Therapy for XSCID)
·In April 2020, we announced that the European Medicines Agency ("EMA") granted Advanced Therapy Medicinal Product ("ATMP") classification to MB-107, a lentiviral gene therapy for the treatment of X-linked severe combined immunodeficiency ("XSCID"), also known as bubble boy disease.
·In May 2020, Mustang Bio submitted an Investigational New Drug ("IND") application with the FDA to initiate a multi-center Phase 2 clinical trial of MB-107 in newly diagnosed infants with XSCID who are under the age of two. The trial is expected to enroll 10 patients who, together with 15 patients enrolled in the current multicenter trial led by St. Jude Children’s Research Hospital, will be compared with 25 matched historical control patients who have undergone hematopoietic stem cell transplant ("HSCT"). The primary efficacy endpoint will be event-free survival. The initiation of this trial is currently on hold pending CMC clearance by the FDA. Mustang is targeting topline data from the trial in the second half of 2022.
·Mustang further expects to file an IND in the third quarter of 2020 for a registrational multi-center Phase 2 clinical trial of its lentiviral gene therapy in previously transplanted XSCID patients. This product will be designated MB-207. Mustang anticipates enrolling 20 patients and comparing them to matched historical control patients who have undergone a second HSCT. Mustang is targeting topline data for this trial in the second half of 2022.
·MB-107 is currently in development at our partner company, Mustang Bio, Inc.
MB-105 (PSCA-targeted CAR T cell therapy)
·In the ongoing Phase 1 trial at City of Hope with MB-105, a PSCA-directed CAR T administered systemically to patients with PSCA-positive castration resistant prostate cancer, the first patient to receive the therapy following a standard CAR T conditioning regimen experienced a significant reduction in his prostate-specific antigen (PSA) at day 28. This PSA response was associated with radiographic improvement of the patient’s metastatic disease.
·MB-105 is currently in development at our partner company, Mustang Bio, Inc.
MB-106 (CD20-targeted CAR T cell therapy)
·In February 2020, we announced that the first subject treated with the optimized MB-106 (CD20-targeted, autologous CAR T cell therapy) manufacturing process, developed in collaboration between Mustang Bio and the Fred Hutchinson Cancer Research Center, achieved a complete response at the lowest starting dose in an ongoing Phase 1/2 clinical trial. The trial is evaluating the safety and efficacy of MB-106 in subjects with relapsed or refractory B-cell non-Hodgkin lymphomas.
·MB-106 is currently in development at our partner company, Mustang Bio, Inc.
ONCOlogues (proprietary platform technology using PNA oligonucleotides)
·In May 2020, we entered into an exclusive worldwide licensing agreement with Columbia University to develop novel oligonucleotides for the treatment of genetically driven cancers. The proprietary platform produces oligomers, known as "ONCOlogues," which are capable of binding gene sequences 1,000 times more effectively than complementary native DNA.
oONCOlogues invade a DNA double helix and displace native mutated strands. This prevents the mRNA that antisense binds to from ever being created. It is higher upstream than an antisense approach as well as potentially more potent and broader in its utility.
·In addition, we are exploring the potential of the platform to treat novel coronaviruses, such as COVID-19.
·The "Suppression of KRAS-G12D and BRAF-V600E Oncogene Transcription with PNA Conjugates" data presentation from the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) Congress in 2019 can be found here.
·The ONCOlogues platform is currently in development at our partner company, Oncogenuity, Inc.
General Corporate
·In February 2020, we closed on a gross total of approximately $14.4 million in an underwritten public offering of our 9.375% Series A Cumulative Redeemable Perpetual Preferred Stock.
·In March 2020, our Board of Directors authorized the repurchase of up to $5 million of Fortress’ 9.375% Series A Cumulative Redeemable Perpetual Preferred Stock (Nasdaq: FBIOP).
Financial Results:
To assist our stockholders in understanding our company, we have prepared non-GAAP financial results for the three months ended March 31, 2020 and 2019. These results exclude the operations of our three public partner companies: Avenue Therapeutics, Inc., Checkpoint Therapeutics, Inc. and Mustang Bio, Inc., as well as any one-time, non-recurring, non-cash transactions, such as the gain of $18.4 million we recorded in the first quarter of 2019 resulting from the de-consolidation of Caelum. The goal in providing these non-GAAP financial metrics is to highlight the financial results of Fortress’ core operations, which are comprised of our commercial-stage business, our privately held development stage entities, as well as our business development and finance functions.
·As of March 31, 2020, Fortress’ consolidated cash, cash equivalents and restricted cash totaled $152.5 million, compared to $153.4 million as of December 31, 2019, a decrease of $0.9 million during the quarter.
·Fortress’ net revenue totaled $12.9 million for the first quarter of 2020, which included $11.9 million in net revenue generated from our marketed dermatology products. This compares to net revenue totaling $6.5 million for the first quarter of 2019, which included $6.1 million in net revenue generated from our marketed dermatology products.
·On a GAAP basis, consolidated research and development expenses were $14.9 million for the first quarter of 2020, compared to $23.3 million for the first quarter of 2019. On a non-GAAP basis, research and development expenses were $2.3 million for the first quarter of 2020, compared to $1.6 million for first quarter of 2019.
·On a GAAP basis, consolidated research and development expenses from license acquisitions totaled $0.3 million for the first quarter of 2020, compared to $0.5 million for the first quarter of 2019.
·On a GAAP basis, consolidated general and administrative expenses were $15.5 million for the first quarter of 2020, compared to $13.5 million for the first quarter of 2019. On a non-GAAP basis, general and administrative expenses were $11.6 million, of which $5.6 million is attributed to Journey, for the first quarter of 2020, compared to $8.5 million, of which $3.9 million is attributed to Journey, for the first quarter of 2019.
·On a GAAP basis, consolidated net loss attributable to common stockholders was $12.4 million, or $0.19 per share, for the first quarter of 2020, compared to net income attributable to common stockholders of $1.4 million, or $0.03 per share for the first quarter of 2019, which includes the $18.4 million gain due to the de-consolidation of Caelum.
·Fortress’ non-GAAP loss attributable to common stockholders was $4.2 million, or $0.07 per share, for the first quarter of 2020, compared to Fortress’ non-GAAP loss attributable to common stockholders of $4.7 million, or $0.07 per share, for the first quarter of 2019.