On November 6, 2020 Mylan N.V. (NASDAQ: MYL) reported its financial results for the three and nine months ended September 30, 2020 (Press release, Mylan, NOV 6, 2020, View Source [SID1234570124]).

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!

Third Quarter 2020 Financial Highlights

Total revenues of $2.97 billion, a slight increase on an actual basis and a slight decrease on a constant currency basis, compared to the prior year period.
Revenue Highlights:
North America segment net sales of $1.03 billion, down 5% on an actual and constant currency basis.
Europe segment net sales of $1.12 billion, up 7%, up 2% on a constant currency basis.
Rest of World segment net sales of $795.5 million, up less than 1%, up 3% on a constant currency basis.
U.S. GAAP net earnings of $185.7 million, compared to U.S. GAAP net earnings of $189.8 million in the prior year period.
Adjusted net earnings of $679.7 million, compared to adjusted net earnings of $604.4 million in the prior year period.
Adjusted EBITDA of $1.01 billion, compared to adjusted EBITDA of $922.8 million in the prior year period.
Nine Months Ended September 30, 2020 Financial Highlights

Total revenues of $8.32 billion, a slight increase on an actual basis, up 1% on a constant currency basis, compared to the prior year period.
Revenue Highlights:
North America segment net sales of $3.02 billion, essentially flat on an actual and constant currency basis.
Europe segment net sales of $3.08 billion, up 5% on an actual and constant currency basis.
Rest of World segment net sales of $2.13 billion, down 5%, down 1% on a constant currency basis.
U.S. GAAP net earnings of $245.9 million, compared to U.S. GAAP net loss of $3.7 million in the prior year period.
Adjusted net earnings of $1.72 billion, compared to adjusted net earnings of $1.56 billion in the prior year period.
Adjusted EBITDA of $2.64 billion, compared to adjusted EBITDA of $2.48 billion in the prior year period.
U.S. GAAP net cash provided by operating activities for the nine months ended September 30, 2020 of $1.20 billion, compared to net cash provided by operating activities of $1.12 billion in the prior year period, and adjusted free cash flow for the nine months ended September 30, 2020 of $1.51 billion, compared to $1.29 billion in the prior year period.
Mylan is not providing forward-looking information for U.S. GAAP reported financial measures or a quantitative reconciliation of forward-looking non-GAAP financial information. Please see "Non-GAAP Financial Measures" for additional information.

Mylan Chief Executive Officer Heather Bresch commented: "As we prepare to officially conclude the Mylan story and provide what will be the company’s final earnings update, Mylan’s strong year-to-date results once again demonstrate the benefits of the diverse and durable platform that we have created. I’m extremely proud of how Mylan has performed over the last nine months during these unprecedented times. I sincerely thank our 35,000 employees across the globe for their consistent performance and dedication to providing access to medicine to patients around the world, even while navigating the realities of a global pandemic. It is this unwavering commitment to our mission that has served the company well for almost 60 years, and I am confident will pave the way for the success of Viatris in the years to come."

Mylan Executive Chairman Robert J. Coury commented: "On behalf of Mylan’s Board of Directors and all Mylan employees, I would like to thank Heather for her truly exemplary leadership and lasting contributions to the company, the industry and patients around the world. As we officially close the book on Mylan, I would also like to offer my sincere appreciation and gratitude to all the Mylan employees, both past and present, for their extraordinary resilience and determination to help us reach this pivotal moment in our 60-year history.

"With just 10 days until we close our proposed combination with Pfizer’s Upjohn business, we are excited to bring the two organizations together. Starting on Day 1, management’s full attention will now be turned towards executing upon the integration plan and developing Viatris’ operating strategy. We intend to provide details on Viatris’ strategy, including 2021 guidance, at our upcoming Investor Day, to be held in late February or early March 2021.

"At that time, the management team will outline how Viatris can deliver on its stated commitments and roadmap to maximize value creation, including the realization of $1 billion in synergies and the generation of strong and accelerating free cash flows. Viatris remains committed to returning capital to shareholders with an expected dividend of at least 25% of free cash flows, based upon GAAP operating cash flow less capital expenditures, beginning after the first full quarter of Viatris’ operations, with the expectation to grow the dividend thereafter. We further stand behind our commitment to deleverage towards our target leverage ratio of 2.5x over time and are committed to maintaining an investment grade rating."

RECENT DEVELOPMENTS

Upjohn Transaction Update

On September 14, 2020, the European Commission (the "Commission") approved the divestiture buyers with which Mylan entered into agreements for the sale of certain of Mylan’s products in Europe, which was a requirement of the Commission’s conditional approval of the proposed transaction pursuant to which Mylan will combine with Pfizer Inc’s ("Pfizer") Upjohn business (the "Upjohn Business") (the "Combination") in a Reverse Morris Trust transaction in April 2020.

On October 30, 2020, Mylan and Pfizer announced that the U.S. Federal Trade Commission (the "FTC") accepted a proposed consent order, which concluded the FTC’s review of the proposed Combination. The parties have now obtained all required antitrust clearances for the Combination. The Combination is expected to close on November 16, 2020.

In connection with the proposed Combination, Mylan shareholders will receive one share of Viatris Inc. ("Viatris") common stock for each Mylan ordinary share held by such holder (subject to any applicable withholding taxes). No action is required by Mylan shareholders to receive such shares of Viatris common stock. It is expected that at the beginning of the trading day on November 17, 2020 (which is expected to be the first trading day after the closing date), Viatris will trade on Nasdaq under the ticker symbol "VTRS" and will no longer trade in the "when-issued" market, and Mylan shares will no longer trade on Nasdaq.

Third Quarter 2020 Financial Results

Total revenues for the three months ended September 30, 2020 were $2.97 billion, compared to $2.96 billion for the comparable prior year period, representing an increase of $10.4 million, or less than 1%. Total revenues include both net sales and other revenues from third parties. Net sales for the current quarter were $2.95 billion, compared to $2.93 billion for the comparable prior year period, representing an increase of $19.9 million, or 1%. Other revenues for the current quarter were $24.0 million, compared to $33.5 million for the comparable prior year period.

The increase in net sales was primarily the result of an increase in net sales in the Europe segment of 7% and a slight increase in net sales in the Rest of World segment. These were partially offset by a decrease in net sales in the North America segment of 5%. Mylan’s net sales were favorably impacted by net sales from new products of $170.1 million, as well as the effect of foreign currency translation on current period net sales of approximately $38.4 million, or 1%. The impact of foreign currency translation on current period net sales primarily reflects changes in the U.S. Dollar as compared to the currencies of Mylan’s subsidiaries in the European Union, partially offset by the negative impact of subsidiaries in India. On a constant currency basis, net sales decreased by approximately $18.5 million, or 1%. This decrease was primarily driven by lower volumes, and to a lesser extent, pricing from net sales of existing products, partially offset by new product sales. In the third quarter of 2020, we estimate that the COVID-19 pandemic negatively impacted our net sales by approximately 3%, primarily driven by lower retail pharmacy demand, lower non-COVID-19 related patient hospital visits and a lower number of in person meetings with prescribers and payors, as well as the impact on the back to school sales of the EpiPen Auto-Injector. Below is a summary of net sales in each of our segments for the three months ended September 30, 2020:

Net sales from North America segment totaled $1.03 billion in the current quarter, a decrease of $59.8 million or 5% when compared to the prior year period. This decrease was primarily driven by lower volumes, and to a lesser extent, pricing from net sales of existing products partially offset by new product sales, including sales from the launch of dimethyl fumarate capsules, a substitutable generic of Biogen Inc.’s Tecfidera. The decrease in net sales of existing products was primarily driven by lower EpiPen Auto-Injector volumes partially due to the negative impact of COVID-19 which resulted in lower back to school sales and changes in the competitive environment, including for Levothyroxine Sodium. These decreases were partially offset by increased volumes on Wixela Inhub. The impact of foreign currency translation on current period net sales was insignificant within North America.
Net sales from Europe segment totaled $1.12 billion in the current quarter, an increase of $77.9 million, or 7%, when compared to the prior year period. This increase was primarily due to the favorable impact of foreign currency translation of approximately $57.9 million or 5%, and new product sales. The favorable impact of these items was partially offset by lower volumes from net sales of existing products primarily due to the negative impact of COVID-19. Pricing was relatively stable in the quarter when compared to the prior year period. Constant currency net sales increased by approximately $20.0 million, or 2%, when compared to the prior year period.
Net sales from Rest of World segment totaled $795.5 million in the current quarter, an increase of $1.8 million or less than 1%, when compared to the prior year period. This increase was primarily driven by new product sales, including sales of Remdesivir in India. This increase was partially offset by lower pricing, primarily due to government price reductions in Japan and Australia, and volumes from net sales of existing products, and the unfavorable impact of foreign currency translation. While volumes of existing products in the Company’s anti-retroviral franchise were higher compared to the prior year period, this increase was offset by lower volumes from net sales of existing products, partially driven by the negative impact of COVID-19 primarily in China, Russia and Japan. Overall, net sales from Rest of World were unfavorably impacted by the effect of foreign currency translation by approximately $18.7 million, or 2%. Constant currency net sales increased by approximately $20.5 million, or 3% when compared to the prior year period.
U.S. GAAP gross profit was $1.16 billion and $1.07 billion for the third quarter of 2020 and 2019, respectively. U.S. GAAP gross margins were 39% and 36% in the third quarter of 2020 and 2019, respectively. U.S. GAAP gross margins were positively impacted by margins on sales of new products of 380 basis points, primarily in the North America segment, and lower amortization expense from acquired intangible assets of 160 basis points. These items were partially offset by lower gross margins from the net sales of existing products of 260 basis points, primarily in the North America segment. Adjusted gross profit was $1.63 billion and adjusted gross margins were 55% for the third quarter of 2020 compared to adjusted gross profit of $1.56 billion and adjusted gross margins of 53% in the prior year period.

R&D expense for the three months ended September 30, 2020 was $129.8 million, compared to $167.9 million for the comparable prior year period, a decrease of $38.1 million. This decrease was primarily due to lower expenditures related to the reprioritization of global programs, and higher payments in the prior year period related to licensing arrangements for products in development.

Selling, general and administrative ("SG&A") expense for the three months ended September 30, 2020 was $658.4 million, compared to $632.7 million for the comparable prior year period, an increase of $25.7 million. The increase was primarily the result of higher consulting fees and other expenses primarily related to the pending Combination totaling approximately $74.0 million in the current year period, including approximately $30.0 million related to obligations to reimburse Pfizer for certain financing costs under the Business Combination Agreement and Separation Agreement (the "Combination Agreements"). Partially offsetting this increase were lower selling and promotional expenses, including through our active management and certain lower expenses as a result of COVID-19.

During the third quarter of 2020, the Company recorded a net charge of $18.9 million in Litigation settlements and other contingencies, net compared to a net gain of $51.9 million in the comparable prior year period. During the three months ended September 30, 2020, the Company recorded a $16.9 million loss for fair value adjustments related to Pfizer’s proprietary dry powder inhaler delivery platform (the "respiratory delivery platform") contingent consideration and a net charge of approximately $2.0 million related to a number of litigation matters. During the three months ended September 30, 2019, the Company recognized a gain of approximately $51.9 million primarily related to the previously disclosed Celgene Corporation ("Celgene") settlement of $62.0 million partially offset by certain litigation related charges.

U.S. GAAP net earnings decreased by $4.1 million to earnings of $185.7 million for the three months ended September 30, 2020, compared to earnings of $189.8 million for the prior year period and U.S. GAAP EPS decreased from $0.37 in the prior year period to $0.36 in the current quarter. The Company recognized a U.S. GAAP income tax provision of $55.9 million, an increase of $59.9 million over the $4.0 million benefit for the comparable prior year period. During the current quarter, the Company recognized an expense as a result of adjustments to reserve for uncertain tax positions and the assessment of the realizability of deferred tax assets. During the three months ended September 30, 2019, the Company recorded a $42.0 million benefit resulting from refinements to previous estimates in conjunction with the filing of the Company’s 2018 U.S. federal tax return, which revised the estimated impact of the Company’s valuation allowance on its interest limitation deductions and the estimate of available foreign tax credits. Also impacting the current year income tax benefit was the changing mix of income earned in jurisdictions with differing tax rates. Adjusted net earnings increased to $679.7 million compared to $604.4 million for the prior year period.

EBITDA was $794.1 million for the current quarter and $794.8 million for the comparable prior year period. After adjusting for certain items as further detailed in the reconciliation below, adjusted EBITDA was $1.01 billion for the current quarter and $922.8 million for the comparable prior year period.

Nine Months Ended September 30, 2020 Financial Results

Total revenues for the nine months ended September 30, 2020 were $8.32 billion, compared to $8.31 billion for the comparable prior year period, representing an increase of $13.8 million, or less than 1%. Total revenues include both net sales and other revenues from third parties. Net sales for the nine months ended September 30, 2020 were $8.23 billion, compared to $8.21 billion for the comparable prior year period, representing an increase of $25.2 million, or less than 1%. Other revenues for the nine months ended September 30, 2020 were $90.3 million, compared to $101.7 million for the comparable prior year period.

The increase in net sales was primarily the result of an increase in net sales in the Europe segment of 5% which was partially offset by a decrease in net sales in the Rest of World segment of 5% and a slight decrease in net sales in the North America segment. Mylan’s net sales were unfavorably impacted by the effect of foreign currency translation, primarily reflecting changes in the U.S. Dollar as compared to the currencies of Mylan’s subsidiaries in India. The unfavorable impact of foreign currency translation on current year net sales was approximately $93.5 million, or 1%. On a constant currency basis, the increase in net sales was approximately $118.7 million, or 1% for the nine months ended September 30, 2020. This increase was primarily driven by new product sales of $342.8 million, and to a lesser extent, higher volumes of existing products, partially offset by lower pricing on sales of existing products. We have estimated that the net impact of the COVID-19 pandemic decreased net sales during the nine months ended September 30, 2020 by approximately 2%, caused by the same drivers for the three month period. Below is a summary of net sales in each of our segments for the nine months ended September 30, 2020:

Net sales from North America segment totaled $3.02 billion during the nine months ended September 30, 2020, a decrease of $11.7 million or less than 1% when compared to the prior year period. This decrease was due primarily to lower pricing on sales of existing products, partially offset by new product sales and, to a lesser extent, higher volumes on sales of existing products. Lower pricing on sales of existing products was driven by changes in the competitive environment, including for Levothyroxine Sodium, and lower volumes were primarily driven by the EpiPen Auto-Injector, partially offset by increased Wixela Inhub volumes. The impact of foreign currency translation on current period net sales was insignificant within North America.
Net sales from Europe segment totaled $3.08 billion during the nine months ended September 30, 2020, an increase of $150.0 million or 5% when compared to the prior year period. This increase was primarily the result of new product sales and higher net sales of existing products, partially as a result of increased volumes which were driven by the resolution of supply disruptions encountered in the prior year period. The remainder of the increase in net sales was the result of expected net sales growth in the region partially offset by the negative impact of COVID-19. Pricing was relatively stable when compared to the prior year period. Net sales were also favorably impacted by the effect of foreign currency translation of approximately $3.3 million, or less than 1%. Constant currency net sales increased by approximately $146.7 million, or 5%, when compared to the prior year period.
Net sales from Rest of World segment totaled $2.13 billion during the nine months ended September 30, 2020, a decrease of $113.1 million or 5% when compared to the prior year period. The decrease was primarily due to the unfavorable impact of foreign currency translation and, to a lesser extent, by lower pricing on net sales of existing products, primarily driven by government price reductions in Japan and Australia. The decrease in net sales was also due to lower volumes on net sales of existing products related to the estimated negative impact from COVID-19 in China, Russia and Japan. Partially offsetting lower net sales of existing products were new product sales, including Remdesivir in India and emerging markets. Overall, net sales from Rest of World were unfavorably impacted by the effect of foreign currency translation of approximately $92.7 million, or 4%. Constant currency net sales decreased by approximately $20.4 million, or 1%, when compared to the prior year period.
U.S. GAAP gross profit was $3.09 billion and $2.81 billion for the nine months ended September 30, 2020 and 2019, respectively. U.S. GAAP gross margins were 37% and 34% for the nine months ended September 30, 2020 and 2019, respectively. Gross margins were positively impacted by lower amortization expense from acquired intangible assets and intangible asset impairment charges realized in the prior year period of 265 basis points. In addition, gross margins were positively impacted as a result of higher gross profit from sales of new products of 255 basis points, primarily in North America and, to a lesser extent, sales of existing products in Europe. Gross margins were negatively impacted as a result of lower gross profit from sales of existing products in Rest of World and North America of 240 basis points. In addition, gross margins were negatively impacted by incremental costs incurred as a result of the COVID-19 pandemic, including a special bonus for plant employees. Adjusted gross profit was $4.49 billion and adjusted gross margins were 54% for the nine months ended September 30, 2020 compared to adjusted gross profit of $4.44 billion and adjusted gross margins of 53% in the prior year period.

R&D expense for the nine months ended September 30, 2020 was $400.3 million, compared to $488.1 million for the comparable prior year period, a decrease of $87.8 million. This decrease was primarily due to lower expenditures related to the reprioritization of global programs, and higher payments in the prior year period related to licensing arrangements for products in development.

SG&A expense for the nine months ended September 30, 2020 was $1.98 billion, compared to $1.91 billion for the comparable prior year period, an increase of $74.0 million. The increase was due primarily to higher consulting fees along with other expenses primarily related to the pending Combination totaling approximately $235.5 million in the current year period, including approximately $115.0 million related to obligations to reimburse Pfizer for certain financing costs under the Combination Agreements. Partially offsetting this increase were lower selling and promotional expenses, including through our active management and certain lower expenses as a result of COVID-19.

During the nine months ended September 30, 2020 the Company recorded a net charge of $36.5 million in Litigation settlements and other contingencies, net compared to a net gain of $30.3 million in the comparable prior year period. During the nine months ended September 30, 2020, the Company recorded a $35.6 million loss for fair value adjustments related to respiratory delivery platform contingent consideration. Additionally, the Company recorded a net charge of approximately $0.9 million related to a number of litigation matters. Litigation settlements for the nine months ended September 30, 2019, consisted of litigation related gains of approximately $1.4 million primarily related to a favorable litigation settlement related to the previously disclosed Celgene matter of $62.0 million offset by litigation related charges for settlements reached related to the modafinil antitrust matter of $18.0 million and the settlement with the U.S. Securities and Exchange Commission ("SEC") in connection with the SEC staff’s investigation of the Company’s public disclosures regarding its 2016 settlement with the Department of Justice concerning the EpiPen Medicaid Drug Rebate Program of $30.0 million. Additionally, the Company recognized a gain of $28.9 million for fair value adjustments related to the respiratory delivery platform contingent consideration.

U.S. GAAP net earnings (loss) increased by $249.6 million to earnings of $245.9 million for the nine months ended September 30, 2020, compared to a loss of $(3.7) million for the prior year period. The Company recognized a U.S. GAAP income tax provision of $46.4 million, compared to a U.S. GAAP income tax provision of $22.9 million for the comparable prior year period, an increase of $23.5 million. During the nine months ended September 30, 2020, the Company recognized a net charge as a result of adjustments to reserves for uncertain tax positions, partially offset by changes in the assessment of the realizability of deferred tax assets. During the nine months ended September 30, 2019, the Company reached a settlement in principle with the U.S. Internal Revenue Service ("IRS") to resolve federal tax matters related to the February 27, 2015 acquisition by Mylan N.V. of Mylan Inc. and Abbott Laboratories’ non-U.S. developed markets specialty and branded generics business, including adjusting the interest rates used for intercompany loans and confirming our status as a non-U.S. corporation for U.S. federal income tax purposes, and recorded a reserve of approximately $140.0 million as part of its liability for uncertain tax positions, with a net impact to the income tax provision of approximately $129.9 million related to this matter. During the nine months ended September 30, 2019, primarily due to the settlement in principle reached with the IRS and the expiration of federal and foreign statutes of limitations, the Company increased its net liability for unrecognized tax benefits by approximately $46.1 million. Also impacting the current year income tax expense was the changing mix of income earned in jurisdictions with differing tax rates. Adjusted net earnings increased to $1.72 billion compared to $1.56 billion for the prior year period.

EBITDA was $1.95 billion for the nine months ended September 30, 2020, and $1.93 billion for the comparable prior year period. After adjusting for certain items as further detailed in the reconciliation below, adjusted EBITDA was $2.64 billion for the nine months ended September 30, 2020 and $2.48 billion for the comparable prior year period.

Cash Flow

U.S. GAAP net cash provided by operating activities for the three and nine months ended September 30, 2020 was $525.0 million and $1.20 billion, compared to $487.8 million and $1.12 billion in the comparable prior year periods. Capital expenditures were approximately $38.2 million and $126.1 million for the three and nine months ended September 30, 2020 compared to approximately $42.3 million and $139.6 million for the comparable prior year periods.

Adjusted net cash provided by operating activities for the three and nine months ended September 30, 2020 was $668.2 million and $1.63 billion compared to adjusted net cash provided by operating activities of $584.4 million and $1.43 billion for the comparable prior year period. Adjusted free cash flow, defined as adjusted net cash provided by operating activities less capital expenditures, was $630.7 million and $1.51 billion for the three and nine months ended September 30, 2020, compared to $542.1 million and $1.29 billion for the comparable prior year period.

Conference Call, Earnings Materials, and Guidance
Due to the proposed combination and upcoming transaction close with Pfizer’s Upjohn business, Mylan will not be holding a third quarter conference call to review results and will no longer provide financial guidance for 2020. A copy of the earnings release along with the "Q3 2020 Earnings Presentation" will be available at investor.mylan.com.

On November 6, 2020 Astellas Pharma Inc. (TSE: 4503, President and CEO: Kenji Yasukawa, Ph.D., "Astellas") reported that the China National Medical Products Administration (NMPA) has approved XTANDI (enzalutamide soft capsules) for the treatment of adult men with non-metastatic castration-resistant prostate cancer (nmCRPC) with high risk of metastasis (Press release, Astellas, NOV 6, 2020, View Source [SID1234570123]). This is the second approved indication in China for enzalutamide, which is already available for adult men with metastatic castration-resistant prostate cancer (mCRPC) who are asymptomatic or mildly symptomatic after failure of androgen deprivation therapy (ADT), in whom chemotherapy is not yet indicated.

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!

The approval is based on results from the PROSPER trial, a double-blind, placebo-controlled, pivotal Phase 3 trial that evaluated enzalutamide plus ADT versus placebo plus ADT in 1,401 men with nmCRPC and rapidly rising prostate-specific antigen levels. PROSPER met its primary endpoint of metastasis-free survival (MFS), with a median MFS of 36.6 months for men who received enzalutamide plus ADT, compared to 14.7 months with placebo plus ADT. Results demonstrated a 71 percent reduction in the risk of radiographic progression or death in men who received enzalutamide plus ADT, compared to placebo plus ADT (hazard ratio=0.29 [95% confidence interval: 0.24-0.35]; p<0.001).

The most common adverse events of any grade for patients ≥10% and higher for enzalutamide plus ADT vs. placebo plus ADT were: fatigue (33% vs. 14%), hot flush (13% vs. 8%), hypertension (12% vs. 5%), nausea (11% vs. 9%), fall (11% vs. 4%), dizziness (10% vs. 4%) and decreased appetite (10% vs. 4%). These results were published in the New England Journal of Medicine in 2018. Results from the study’s overall survival secondary endpoint were published in the New England Journal of Medicine in 2020.

"In order to maintain quality of life for men with non-metastatic prostate cancer, new treatments are needed to delay the progression of prostate cancer and prevent it from spreading to other areas in the body. In clinical studies, enzalutamide significantly reduced the risk of the cancer spreading or death compared to placebo alone," said Andrew Krivoshik, M.D., Ph.D., Senior Vice President and Global Therapeutic Area Head, Oncology Development, Astellas.

"Enzalutamide in non-metastatic castration-resistant prostate cancer provides patients and their doctors with an important new option for the treatment of their advancing prostate cancer," said Hiroshi Hamaguchi, President, Greater China Commercial, Astellas. "We look forward to serving more patients and physicians as we expand our work in prostate cancer and continue to grow the Astellas oncology program in China."

Astellas reflected the impact from this approval in its financial forecast of the current fiscal year ending March 31, 2021.

On November 6, 2020 Apollomics, Inc., an innovative biopharmaceutical company committed to the discovery and development of oncology combination therapies, reported the completion of a $124.2 million Series C Financing led by Ping An Capital with participation from several new and existing investors (Press release, Apollomics, NOV 6, 2020, View Source [SID1234570122]). Dong Liu, PhD nominated by Ping An Capital will also join the Apollomics Board of Directors effective today.

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!

Proceeds from the Series C financing will support the development of the Apollomics pipeline with a focus on the Company’s lead programs: APL-101 and APL-106. APL-101 is a novel, orally administered, selective c-MET inhibitor currently enrolling an international multicenter, Phase 2 portion of a combined Phase 1/2 clinical trial, titled SPARTA. APL-106 (uproleselan) is a first-in-class, targeted E-selectin antagonist that has received Breakthrough Therapy Designation from the U.S. Food and Drug Administration (FDA) in relapsed and refractory acute myeloid leukemia. Apollomics is actively planning to initiate a Phase 1 PK study and, in parallel, a Phase 3 bridging clinical trial in China.

"Apollomics is focused on a precision medicine approach that targets specific mutations, amplifications and resistance mechanisms to bring transformative therapies to cancer patients, said Guo-Liang Yu, PhD, Co-Founder, Chairman and Chief Executive Officer. "We appreciate the profound level of support and interest we received during this financing and welcome several new investors to our shareholder base. With this infusion of capital, we will continue our ambitious plans to progress our current pipeline and expand our programs globally."

Sanjeev Redkar, PhD, Co-Founder and President, added, "Since our founding in 2016, we have established a broad portfolio of single agent and combination programs through our internal research efforts and strategic collaborations. In conjunction with our partners, we now have six assets in over ten clinical trials in the U.S. and China. We are pleased with the progress we have made thus far and expect to maintain this momentum going forward as our pipeline evolves."

On November 5, 2020 Artiva Biotherapeutics, Inc., and Affimed N.V. (NASDAQ: AFMD), both immuno-oncology companies focused on developing and commercializing therapies utilizing the innate immune system, reported that that they have entered into an exclusive collaboration agreement to assess combining elements of their respective platforms in the generation of targeted, off-the-shelf allogeneic NK cell therapies (Press release, Affimed, NOV 5, 2020, View Source [SID1234615396]).

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!

The R&D collaboration will assess the feasibility and preclinical activity of combinations of Artiva’s allogeneic NK cell product AB-101 and Affimed’s ICE molecules, building on earlier preclinical studies demonstrating synergistic cytotoxic activity. Under the agreement, Affimed’s ICE molecules targeting EGFR and other undisclosed targets will be combined with Artiva’s GMP-grade allogeneic NK cells during the cell manufacturing process. The pre-manufacturing process will include the loading of AB-101 with Affimed ICE molecules prior to cryopreservation, creating specifically targeted allogeneic cells without the requirement for viral transduction. The resulting cryopreserved, off-the-shelf, targeted allogeneic NK cell products will be assessed for anti-tumor activity and development potential. The costs of manufacturing and preclinical assessments will be shared by both companies. The agreement provides for potential further development of selected combination products.

"The combination of Artiva’s highly scaled, optimized NK-cell manufacturing platform with Affimed’s tumor-targeting ICE molecules has the potential for an efficient and flexible therapeutic combination product platform, and preclinical assessments have already demonstrated the potential of this approach," said Tom Farrell, President and CEO of Artiva. "Our NK cells are activated during the manufacturing process resulting in high and consistent expression of innate tumor engagement receptors, including CD16A, making them the ideal platform to combine with tumor-specific targeting ICE from Affimed’s platform."

"The collaboration with Artiva represents a visionary approach which can lead to a new class of drugs providing a potent and targeted innate immune system-cytotoxic response," said Dr. Adi Hoess, Affimed’s Chief Executive Officer. "Our ROCK platform has been proven to rapidly and predictably generate a set of diverse innate cell engagers, with consistent profiles in tumor lysis and safety making our ICE molecules optimally suited for combination therapy with NK cells."

Using its ROCK (Redirected Optimized Cell Killing) platform, Affimed has developed a novel pipeline of ICE products; tetravalent, bispecific therapeutics specific for tumor targets such as epidermal growth factor receptor (EGFR) and CD30 and maintaining high affinity CD16A-binding for enhanced activation of innate immunity, inducing both antibody-dependent cellular cytotoxicity (ADCC) and antibody-dependent cellular phagocytosis (ADCP).

Artiva’s AB-101 is a universal NK cell therapy for use in combination with monoclonal antibodies or novel modalities such as NK cell engagers. In preclinical studies, AB-101 has demonstrated enhanced antibody-dependent cellular cytotoxicity with a variety of therapeutic antibodies. The company plans to enter the clinic this year with AB-101, assessing monotherapy safety and efficacy and subsequent therapeutic potential in combination with an anti-CD20 monoclonal antibody for the treatment of relapsed refractory B-cell lymphoma. The first batches of AB-101 drug product, manufactured at very large scale and cryopreserved in infusion-ready media, have already been produced for clinical use.

On November 5, 2020 DXC Technology (NYSE: DXC) reported results for the second quarter of fiscal year 2021 (Press release, DynPort Vaccine Company, NOV 5, 2020, View Source [SID1234574201]). Revenue of $4.55 billion and non-GAAP diluted EPS of $0.64 exceeded the top end of our guidance.

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!

"We delivered strong second quarter results as the ‘new DXC’, exceeding our revenue and non-GAAP diluted EPS targets. We also improved margins sequentially, and achieved a book-to-bill of 1.1x. We are making good progress on the three key areas of our transformation journey, which are: focus on customers, optimize costs, and seize the market," said Mike Salvino, DXC president and chief executive officer.

"We recently closed the sale of our U.S. State and Local Health and Human Services business for $5.0 billion and paid down $3.5 billion of debt, strengthening our balance sheet. We are also on track to close the sale of our Healthcare Provider Software business to Dedalus by the end of this fiscal year. I want to thank our people for driving the momentum and helping us deliver our strong financial results this quarter and their commitment to delivering for our customers."

Financial Highlights – Second Quarter Fiscal 2021

Revenue in the second quarter was $4,554 million.
Net loss was $246 million for the second quarter including pre-tax special items of $265 million in restructuring costs, $101 million in transaction, separation, and integration-related costs, and $152 million in amortization of acquired intangibles.
Non-GAAP net income was $161 million, excluding those special items, net of tax.
Diluted earnings per share was $(0.96) in the second quarter; non-GAAP diluted earnings per share was $0.64.
Net cash provided by operating activities was $472 million in the second quarter.
Adjusted free cash flow was $237 million in the second quarter.
Financial Information by Segment

Global Business Services (GBS)

GBS bookings for the quarter totaled $2.4 billion for a book-to-bill ratio of 1.1x.
GBS revenue was $2,242 million in the quarter. GBS revenue decreased 1.9% year-over-year.
In constant currency, GBS revenues decreased 3.4% year-over-year and increased 0.5% sequentially.
GBS profit margin in the quarter was 14.1%, an increase of 4.2% vs. the prior quarter. Year-over-year, margins were down 1.6%, reflecting prior terminations and price-downs along with customer settlements that were actioned in the quarter, offset by the timing of cost take out initiatives.
Global Infrastructure Services (GIS)

GIS bookings for the quarter was $2.5 billion for a book-to-bill ratio of 1.1x.
GIS revenue was $2,312 million in the quarter. GIS revenues decreased 9.9% year-over-year.
In constant currency, GIS revenues decreased 11.6% year-over-year and decreased 4.0% sequentially.
GIS profit margin in the quarter was 1.6%, an increase of 0.6% vs. the prior quarter. Year-over-year, margins were down 7.9% due to the impact of prior terminations and price-downs along with customer settlements that were actioned in the quarter.
Earnings

EBIT and adjusted EBIT in the quarter were $(235) million and $283 million, respectively. EBIT and adjusted EBIT margins were (5.2)% and 6.2%, respectively. Adjusted EBIT margin in the quarter was better than anticipated, benefiting from our cost optimization initiatives.
Diluted EPS and non-GAAP diluted EPS were $(0.96) and $0.64, respectively, in the quarter. Diluted EPS and non-GAAP diluted EPS were impacted by a lower than expected tax rate of 24.1%.
Cash Flow

Net cash provided by operating activities was $472 million in the second quarter and adjusted free cash flow was $237 million. Operating cash flow and adjusted free cash flow benefited from working capital management. Adjusted free cash flow also benefited from lower capital expenditures during the quarter.
Earnings Conference Call and Webcast

DXC Technology senior management will host a conference call and webcast to discuss these results today at 4:45 p.m. EST. The dial-in number for domestic callers is 800-367-2403. Callers who reside outside of the United States should dial +1-334-777-6978. The passcode for all participants is 8144357. The webcast audio and any presentation slides will be available on DXC Technology’s Investor Relations website.

A replay of the conference call will be available from approximately two hours after the conclusion of the call until November 12, 2020. The replay passcode is 8144357.