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West Announces Second-Quarter 2020 Results

On July 23, 2020 West Pharmaceutical Services, Inc. (NYSE: WST) reported its financial results for the second-quarter 2020 and updated full-year 2020 financial guidance (Press release, West Pharmaceutical Services, JUL 23, 2020, View Source [SID1234562268]).

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Second-Quarter 2020 Summary (comparisons to prior-year period)

Net sales of $527.2 million grew 12.2%; organic sales growth was 14.3%.
Reported-diluted EPS of $1.21 increased 38%.
Adjusted-diluted EPS of $1.25 increased 40%.
Company is raising full-year 2020 net sales guidance to a new range of between $2.035 billion and $2.055 billion.
Company is raising full-year 2020 adjusted-diluted EPS guidance to a new range of between $4.15 and $4.25.
"Adjusted-diluted EPS" and "organic sales growth" are Non-U.S. GAAP measurements. See discussion under the heading "Non-U.S. GAAP Financial Measures" in this release.

"Our second quarter results reflect the strength and resiliency of our business in today’s environment," said Eric M. Green, President and Chief Executive Officer. "We continue to see underlying demand growth in our existing business for our high-value products and in high adoption rates from customers who are developing therapeutics and vaccines to address the COVID-19 pandemic."

Mr. Green continued, "The outlook for the balance of 2020 remains robust; and with our One West philosophy, broad range of innovative solutions and the ability to flex our global operating network, we are well positioned. I am extremely proud of our colleagues’ response to the challenging landscape and the dedicated focus on delivering high-quality components and solutions to our customers."

Proprietary Products Segment
Net sales grew by 10.9% to $399.5 million. Organic sales growth was 13.3%, with currency translation decreasing sales growth by 240 basis points. High-value products (HVP) represented 65% of segment sales and generated double-digit organic sales growth.

Our Biologics market unit had double-digit organic sales growth, led by customer purchases of film-coated components (Flurotec and Daikyo), self-injection platforms, Westar and Crystal Zenith components. Our Generics market unit posted double-digit organic sales growth, and our Pharma market unit grew organic sales by low-single digits. Both Generics and Pharma market units were led by sales of film-coated and Westar components.

Contract-Manufactured Products Segment
Net sales grew by 16.8% to $127.8 million. Organic sales growth was 17.8% with currency translation decreasing sales growth by 100 basis points. Segment performance was led by strong sales of healthcare-related injection and diagnostic devices.

Financial Highlights (first six months of 2020)
Operating cash flow was $205.2 million, an increase of 34%. Capital expenditures were $69.2 million. Free cash flow (operating cash flow minus capital expenditures) was $136.0 million, an increase of 42%.

Full-Year 2020 Financial Guidance

Full-year 2020 net sales guidance is expected to be in a range of between $2.035 billion and $2.055 billion, compared to a prior range of between $1.95 billion and $1.97 billion.
Organic sales growth is expected to be approximately 12%, compared to a prior guidance range of 8%.
Net sales guidance includes an estimated full-year headwind of $26 million for the full-year 2020 based on current foreign exchange rates, unchanged from prior guidance.
Full-year 2020 adjusted-diluted EPS is expected to be in a range of between $4.15 and $4.25, compared to a prior range of between $3.52 and $3.62.
Full-year adjusted-diluted EPS guidance includes an estimated headwind of approximately $0.07 based on current foreign currency exchange rates, unchanged from prior guidance.
The revised guidance includes a $0.16 EPS impact from tax benefits from stock-based compensation in the first six months of 2020.
For the remainder of the year, our EPS guidance range assumes a tax rate of 24% and does not include potential tax benefits from stock-based compensation. Any tax benefits associated with stock-based compensation beyond those recorded in the first six months of 2020 would provide a positive adjustment to our full-year EPS guidance.
Second-Quarter 2020 Conference Call
The Company will host a conference call to discuss the results and business expectations at 9:00 a.m. Eastern Time today. To participate on the call please dial 877-930-8295 (U.S.) or 253-336-8738 (International). The conference ID is 7789173.

A live broadcast of the conference call will be available at the Company’s website, www.westpharma.com, in the "Investors" section. Management will refer to a slide presentation during the call, which will be made available on the day of the call. To view the presentation, select "Presentations" in the "Investors" section of the Company’s website.

An online archive of the broadcast will be available at the website three hours after the live call and will be available through Thursday, July 30, 2020, by dialing 855-859-2056 (U.S.) or 404-537-3406 (International) and entering conference ID 7789173.

Synaffix Announces Third Deal Expansion by ADC Therapeutics

On July 23, 2020 Synaffix B.V., a biotechnology company focused on enabling antibody-drug conjugates (ADCs) with superior therapeutic index based on its proprietary ADC technology platform, reported that ADC Therapeutics SA has expanded its existing collaboration to explore additional applications, including DAR1, of Synaffix’ site-specific conjugation technologies (Press release, Synaffix, JUL 23, 2020, View Source [SID1234562267]).

Under the expanded collaboration, ADC Therapeutics has been granted non-exclusive rights for two additional programs, which brings the total number of programs using Synaffix’ ADC technologies to five. ADC Therapeutics also gains access to the latest innovative extensions of Synaffix’ proprietary GlycoConnect platform, including DAR1 technology that enables stable attachment of just a single drug per antibody.

Synaffix is eligible to receive upfront, milestone and royalty payments tied to each program. Further financial details are not disclosed.

Peter van de Sande, CEO of Synaffix said:

"We are very pleased to see the rapid progression of ADC Therapeutics’ programs that have been developed using our GlycoConnect ADC technology platform, and the multiple collaboration expansions that have followed our original agreement.

"We look forward to continuing to work closely with the ADC Therapeutics team as they translate more product candidates using GlycoConnect into the clinic."

Synaffix entered into the original commercial license agreement with ADC Therapeutics in October 2016. ADC Therapeutics is responsible for the research, development, manufacturing and commercialization of any resulting ADC products, and Synaffix is responsible for the manufacturing of components specifically related to its proprietary ADC technologies.

Clarity Pharmaceuticals opens SARTATE™ neuroblastoma clinical trial

On July 23, 2020 Clarity Pharmaceuticals, a radiopharmaceutical company focused on the treatment of serious disease, reported that it has opened its trial of 67Cu-SARTATE for paediatric patients with neuroblastoma at Memorial Sloan Kettering Cancer Center (MSK) in New York City and recruitment has commenced (Press release, Clarity Pharmaceuticals, JUL 23, 2020, View Source [SID1234562244]).

"We are very excited to commence recruitment for our trial in this very important patient population" commented Dr Alan Taylor, Clarity’s Executive Chairman. "The opening of the trial and commencement of recruitment comes shortly after the U.S. Food and Drug Administration (FDA) has granted Orphan Drug Designation status for both the diagnostic and therapeutic applications of SARTATE in neuroblastoma. Achieving these milestones despite the challenging conditions presented by the coronavirus pandemic signifies strong support from the FDA, MSK and Clarity’s collaborators and importantly our team which relates to the importance of progressing the development of SARTATE in this vulnerable patient population."

67Cu-SARTATE trial is a Peptide Receptor Radionuclide Therapy (PRRT) administered to paediatric patients with high-risk neuroblastoma. It is a multi-centre, dose-escalation, open label, non-randomised, Phase 1/2a theranostic clinical trial at MSK.1 MSK is the world’s oldest and largest private cancer centre. It has devoted more than 135 years to exceptional patient care, innovative research, and outstanding educational programs.

Neuroblastoma most often occurs in children younger than 5 years of age and presents when the tumour grows and causes symptoms. It is the most common type of cancer to be diagnosed in the first year of life and accounts for around 15% of paediatric cancer mortality.2 High-risk neuroblastoma accounts for approximately 45% of all neuroblastoma cases. Patients with high-risk neuroblastoma have the lowest 5-year survival rates at 40%-50%.3

Dr Taylor said: "At this time, children with high-risk neuroblastoma have poor prognosis as current treatment strategies have limited effect in patients with late-stage disease where cancer has metastasised. It is evident that the development of new treatment approaches and strategies is crucial to improving treatment outcomes for this patient population. We are looking forward to progressing the development of SARTATE and getting closer to our ultimate goal of better treatment of children and adults with cancer."

G1 Therapeutics Announces License Agreement for Lerociclib

On July 22, 2020 G1 Therapeutics, a clinical-stage oncology company, reported a license agreement for lerociclib to EQRx, a biopharmaceutical company focused on making innovative medicines at dramatically lower prices for the benefit of people and society (Press release, G1 Therapeutics, JUL 22, 2020, View Source [SID1234634609]). Under the terms of the agreement, EQRx gains exclusive rights for lerociclib in the U.S., Europe, Japan and all other global markets, excluding the Asia-Pacific region (except Japan). G1 will receive an upfront cash payment of $20 million and will be eligible to receive development and commercial milestone payments of up to $290 million, plus tiered royalties ranging from mid-single digits to mid-teens based on annual net sales of lerociclib.

"We are excited to partner with EQRx to further development of lerociclib, a differentiated oral CDK4/6 inhibitor designed to enable more effective combination treatment strategies," said Mark Velleca, M.D., Ph.D., Chief Executive Officer of G1. "This is the third strategic collaboration we have executed this year. Collectively, these partnerships have advanced our goal to provide global access to our promising oncology therapies and extend our financial runway so that we can continue our efforts to bring novel treatments to patients with cancer."

Discovered and developed by G1, lerociclib has demonstrated clinical proof-of-concept and a differentiated profile in a Phase 1/2 trial in patients with ER+, HER2- breast cancer. Earlier this year, G1 licensed development and commercialization rights in the Asia-Pacific region (excluding Japan) to Genor Biopharma.

About Lerociclib
Lerociclib is a differentiated oral CDK4/6 inhibitor being developed for use in combination with other targeted therapies in certain types of breast and lung cancer. Preliminary clinical data in estrogen receptor-positive, HER2-negative (ER+, HER2-) breast cancer have demonstrated proof-of-concept of the differentiated clinical profile of lerociclib versus currently marketed CDK4/6 inhibitors, with improved tolerability and less neutropenia. Neutropenia is one of the main toxicities associated with CDK4/6 inhibition. Current treatments require frequent blood testing for neutropenia. Less monitoring would mean fewer office visits and blood draws, improving the experience for patients and reducing the burden on physician offices and costs to the healthcare system.

TGEN, CITY OF HOPE LOOKING TO CREATE PERSONALIZED ROADMAPS FOR THE TREATMENT OF KIDNEY CANCER

On July 22, 2020 Experts at City of Hope and the Translational Genomics Research Institute (TGen) reported that they are using one of the world’s most comprehensive genomic analysis tools to map out personalized treatment plans for metastatic kidney cancer patients (Press release, TGen, JUL 22, 2020, View Source [SID1234562374]).

While the physician-scientists are at the beginning of this long journey, they believe they’re on the right path. They recently published a study in the Journal of Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) that suggests mutations in the TERT gene predicts that a patient may not be receptive to immune checkpoint inhibitors such as nivolumab or pembrolizumab.

"The hope is to one day identify patients who will benefit from immunotherapy and those who will not. Eventually we may be able to distinguish which patient is better suited for other treatments, like targeted therapy," said Sumanta Pal, M.D., one of the study’s senior authors and co-director of the Kidney Cancer Program at City of Hope, a world-renowned independent research and treatment center for cancer, diabetes and other life-threatening diseases. Examples of targeted therapy include vascular endothelial growth factor (VEGF) tyrosine kinase inhibitors like cabozantinib.

Nearly 74,000 new cases of kidney cancer will be diagnosed this year, and about 14,800 people will die from the disease, according to the American Cancer Society. Ironically, experts know patients who have certain genetic mutations are more susceptible to specific drugs, but most doctors are not genetically sequencing each kidney cancer patient’s tumors, Pal said.

"It’s a paradox: We don’t use targeted therapy in a targeted fashion," he added. "At City of Hope, we have begun to provide comprehensive genome and exome sequencing for all patients with Stage 4 cancer, regardless of their cancer site."

City of Hope is on pace to be the only major cancer center in the United States to genetically profile the tumors of every single patient, regardless of cancer type. The goal is to enable patients to receive effective targeted therapies or to enroll people in innovative clinical trials as early as possible so that they can fight their disease.

In the study, Pal and his colleagues sent samples of 91 patients’ tumors to TGen’s clinical laboratory, Ashion Analytics, so that the specimens could be sequenced by GEM ExTra a leading-edge tool that features tumor-normal whole exome sequencing and tumor whole transcriptome sequencing. These are molecular-level analyses of each patient’s entire protein-coding DNA and RNA.

"The goal was to identify genomic alterations that correlated with therapy response," said Sara Byron, Ph.D., assistant professor in TGen’s Integrated Cancer Genomics Division and co-senior author of the study. "We wanted to use this ‘real-world evidence’ to explore potential molecular and genomic features associated with response." (Ashion Analytics recently announced that Medicare has approved coverage of GEM ExTra, potentially providing 44 million more patients access to this test, which aims to match patients with the best available treatments for their disease.)

Kidney cancer treatment regimens involving either targeted therapy or immunotherapy have burgeoned since 2015. Because new treatments sprouted so rapidly, scientists have not yet discovered the ideal strategy to sequence regimens for optimal outcomes. Moreover, the current way treatment risk is assessed tends to be subjective with ingrained bias, the study reported. City of Hope and TGen are working to develop objective laboratory-based biomarkers for kidney cancer.

Only patients whose genomic profiling was performed prior to systemic treatment were included in the study. Patients received either targeted therapy known as VEGF tyrosine kinase inhibitors (sunitinib, cabozantib, lenvatinib/everolimus) or immunotherapy (nivolumab, ipilimumab, pembrolizumab). They were divided into those who received no clinical benefit, meaning their disease progressed, or those who received clinical benefit, meaning the disease shrunk or stabilized for more than six months. Some 19,396 genes and nucleic sequences were analyzed to tease out a therapeutic treatment plan that would have best suited each patient based on their specific tumor mutations. More research in larger sample sizes are needed, but the scientists are off to a good start.

"Stage 4 cancer is often considered incurable, but that doesn’t always have to be the case," Pal said. "By sequencing all protein-coding DNA, that is by sequencing the whole exome, we may be able to identify new therapeutic targets, and that’s a very exciting prospect."