BIOLASE, Inc to Report First Quarter 2020 Results on May 7, 2020

On April 30, 2020 BIOLASE, Inc. (NASDAQ: BIOL), the global leader in dental lasers, reported that it will release first quarter 2020 financial and operating results on Thursday, May 7, 2020 after the close of the U.S. financial markets and will host a conference call and webcast that day at 4:30 p.m. ET / 1:30 p.m. PT to discuss the results and corporate developments (Press release, Biolase Technology, APR 30, 2020, View Source [SID1234556884]).

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For both "listen-only" participants and those participants who wish to take part in the question-and-answer portion of the call, the dial-in number in the U.S./Canada is 800-353-6461. For international participants outside the U.S./Canada, the dial-in number is 334-323-0501. For all callers, refer to the Conference ID 6799229. To access the live webcast, go to BIOLASE Investor Events Page.

IDEXX Laboratories Announces First Quarter Results

On April 30, 2020 IDEXX Laboratories, Inc. (NASDAQ: IDXX), a global leader in veterinary diagnostics, veterinary practice software and water microbiology testing, reported first quarter results and business updates related to the 2019 novel coronavirus (COVID-19) pandemic and its impact on market conditions (Press release, IDEXX Laboratories, APR 30, 2020, View Source [SID1234556883]).

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First Quarter Results

The Company reports revenues of $626 million for the first quarter of 2020, an increase of 9% on a reported and organic basis. First quarter results were driven by CAG Diagnostics recurring revenue growth of 10% reported and organic, supported by double-digit organic gains in both U.S. and International markets. Results were also supported by strong reported and organic revenue gains in the Company’s Water and Livestock, Poultry and Dairy ("LPD") businesses, aided in part by an estimated $5 million in accelerated stocking orders in these businesses related to the COVID-19 pandemic.

Earnings per diluted share ("EPS") was $1.29 for the first quarter, reflecting benefits from strong CAG Diagnostics recurring revenue gains and controlled operating expense growth, which supported relatively flat operating margins on a reported basis compared to prior year levels and 30 basis points of improvement on a constant currency basis.

"We are pleased to report excellent first quarter financial results, supported by continued double-digit organic gains in CAG Diagnostics recurring revenues, despite late-quarter impacts from the expansion of COVID-19-related stay-at-home policies and social distancing procedures. These results reflect continued strong underlying demand globally for companion animal healthcare," said Jay Mazelsky, the Company’s President and Chief Executive Officer. "We have seen near-term impacts on veterinary practices related to the COVID-19 pandemic and have been closely monitoring the effect of social distancing policies and industry care guidelines on our customers. IDEXX has continued to provide high levels of service delivery and product support for its customers during this time, while advancing key steps to protect the safety and health of its employees, ensure business continuity and mitigate the near-term impacts on demand for IDEXX products and services. The pet-owner bond is stronger than ever, and IDEXX’s strategy, opportunity and fundamentals remain intact, supported by our innovative product portfolio and talented global team. We are very well-positioned for a strong recovery in the highly attractive and resilient companion animal healthcare market. I am extremely proud of the way our team is working together to respond during this time and thank them for their extraordinary commitment to our Purpose."

COVID-19 Pandemic Update

The primary impacts of the COVID-19 pandemic have been seen in IDEXX’s CAG business. While veterinary care is widely recognized as an "essential" service for pet owners, and veterinarians continue to deliver essential medical care for sick and injured pets, stay-at-home and social distancing policies being deployed to combat the spread of COVID-19, and prioritization of sick and emergency testing at veterinary clinics, have resulted in a decrease in companion animal clinical visits, including delay of elective procedures and wellness visits.

As an example, tracking of weekly U.S. companion animal practice data, available in the Q1 2020 Earnings Snapshot accessible on the IDEXX website, www.idexx.com/investors, indicates year-over-year declines of 15% – 30% in per practice clinical visits from the week ended March 27, 2020 through the week ended April 24, 2020, with lower levels of decline in non-wellness visits and higher levels of decline in wellness visits. These types of trends have contributed to year-over-year declines in demand for IDEXX’s products and services during this period, with varying impacts by region and diagnostic testing modality. These impacts are dynamic, and we have seen meaningful improvement in clinical visit and diagnostic testing trends over the most recent two-week period ended April 24, driven by U.S. and International regions where COVID-19 case management efforts have progressed further and where stay-at-home and social distancing policies have been moderated.

Protecting Employee Health and Safety

In an effort to protect the health and safety of our workforce and their families and communities, the majority of IDEXX employees have been enabled to work remotely during this time. The Company has also implemented other measures, such as restricting travel where possible, to protect the health and safety of our customers, their patients and our employees.

Maintaining Operations and Customer Service

Major IDEXX operations, such as global manufacturing, distribution and our network of reference laboratories, are operating efficiently under enhanced health and safety precautionary measures, and the Company is continuing to serve its customers globally. For Company employees involved in these essential operations, we have implemented recommended best practices to protect the health and safety of our workforce.

Operating Cost and Liquidity Management

The Company has taken proactive steps to prudently control costs in response to the COVID-19 pandemic, while ensuring the Company is well-positioned for a recovery in market conditions. We have advanced actions to reduce quarterly operating expenses by approximately $25 million compared to original plan levels. These actions include the temporary reduction of the salaries of our chief executive officer by 30%, officers and senior executives by 20% and the majority of other salaried employees by 10%, which we intend to stop as market conditions improve, as well as the suspension of cash compensation for IDEXX’s Board of Directors. These savings will mitigate near-term financial impacts from potential revenue declines related to COVID-19 stay-at-home policies and social distancing procedures, which we estimate will flow through at high incremental gross margin rates associated with CAG Diagnostics recurring revenues.

The Company is confident in its working capital and liquidity levels, supported by its high-return recurring revenue business model with relatively low capital intensity. In April, the Company further enhanced its liquidity and financial flexibility by issuing $200 million in 10-year, 2.5% fixed-rate financing and securing an expanded $1 billion credit facility extended through 2023. We also have suspended share repurchase activity.

Product Updates

In April, the Company made IDEXX SARS-CoV-2 (COVID-19) RealPCR Test for pets available to veterinarians in response to customer demand and growing evidence that in rare cases pets living with COVID-19 positive humans can be at risk for infection.

The Company’s human health business, OPTI Medical Systems, has advanced efforts in supporting human COVID-19 testing with the development of a PCR test kit, enabled by IDEXX’s expertise in livestock PCR test development and manufacturing. OPTI Medical Systems has applied for U.S. Food and Drug Administration (FDA) Emergency Use Authorization (EUA) for OPTI SARS-CoV-2 RNA RT-PCR laboratory test kit for the detection of SARS-CoV-2, the virus that causes COVID-19. The test kit provides results in approximately 2 to 3.5 hours following RNA extraction and has been validated on commonly available PCR instruments and extraction methods.

First Quarter Performance Highlights

Companion Animal Group

The Companion Animal Group generated 8% reported and 9% organic revenue growth for the quarter, supported by CAG Diagnostics recurring revenue growth of 10% on a reported and organic basis. Global CAG Diagnostics recurring revenues were trending above our full year goals for 11% to 12% organic growth through early March, with overall first quarter CAG Diagnostics recurring revenue gains constrained by late quarter impacts associated with the COVID-19 pandemic, including stay-at-home policies, social distancing procedures and changes to industry guidelines to emphasize sick patient and emergency procedures, which reduced clinical visits to veterinary practices and related diagnostic testing volumes. While IDEXX’s premium instrument installed base expanded 15% compared to prior year first quarter installed base levels and instrument placement trends were very strong through early March, restrictions on access to veterinary practices also constrained instrument placements late in the first quarter, contributing to declines in reported instrument revenues.

IDEXX VetLab consumables generated 13% reported and 14% organic revenue growth, supported by ongoing expansion of our global premium instrument installed base, continued strong customer retention, increases in testing utilization and moderate net price gains.
Reference laboratory diagnostic and consulting services generated 9% reported and 8% organic revenue growth, supported by volume gains with existing customers, moderate net price realization and benefits from net customer additions.
Rapid assay products generated reported and organic revenue growth of 6%, supported by volume gains across our SNAP portfolio of products, including SNAP 4Dx Plus Test, high customer retention rates and moderate net price gains.
Veterinary software, services and diagnostic imaging systems revenue grew 11% on a reported and organic basis, driven by growth in subscription-based service revenues, supported by continued expansion of our practice management platforms.

Water

Water achieved revenue growth of 13% on a reported basis and 15% on an organic basis in the first quarter, including over $2 million or 8% of year-over-year estimated revenue growth benefit related to timing of orders, including accelerated customer stocking orders related to the COVID-19 pandemic.

Livestock, Poultry and Dairy ("LPD")

LPD generated revenue growth of 8% on a reported basis and 12% on an organic basis for the first quarter, including approximately $3 million or 9% of year-over-year estimated revenue growth benefit related to timing of orders, including accelerated customer stocking orders related to the COVID-19 pandemic. These results also reflect benefits from increases in African Swine Fever diagnostic testing programs in Asia and poultry testing. These gains were constrained by lower herd health screening levels, compared to strong prior year results.

Gross Profit and Operating Profit

Gross profits increased 8% on a reported basis and 10% on a constant currency basis. Gross margin of 57.4% was down slightly compared to prior year period results on a reported basis and was flat compared to prior year period levels on a constant currency basis. Gross margin results reflected favorable mix from strong consumable revenue growth, high Water revenue growth and lower CAG Diagnostics instrument revenues, as well as benefits from moderate net price gains. These favorable factors were offset by relatively lower reference lab margins associated with pressure on reference laboratory revenues late in the quarter related to COVID-19 stay-at-home and social distancing policies, as well as increased reference lab capacity investments advanced in 2019 and effects from the integration of the Marshfield acquisition.

Operating margin was 23.0% in the quarter, 10 basis points lower than the prior year period results on a reported basis and 30 basis points higher on a constant currency basis, supported by operating expense leverage on high revenue growth. Operating expenses increased 9% on a reported and constant currency basis, driven by increases in our CAG segment’s sales and marketing costs and higher general and administrative costs.

2020 Financial Outlook

The Company is withdrawing its previously announced full year 2020 guidance due to the unpredictability of the duration and the magnitude of impacts from the COVID-19 pandemic on veterinary service providers.

Conference Call and Webcast Information

IDEXX Laboratories, Inc. will be hosting a conference call today at 8:30 a.m. (EDT) to discuss its first quarter 2020 results and management’s outlook. To participate in the conference call, dial 1-877-336-4441 or 1-409-207-6985 and reference confirmation code 1103408. Individuals can access a live webcast of the conference call through a link on the IDEXX website, www.idexx.com/investors. An archived edition of the webcast will be available after 1:00 p.m. (EDT) on that day via the same link and will remain available for one year.

2020 Annual Meeting of Shareholders

IDEXX Laboratories, Inc. will hold its 2020 Annual Meeting of Shareholders (the "2020 Annual Meeting") on Wednesday, May 6, 2020 at 10:00 a.m. (EDT). The 2020 Annual Meeting will be a virtual meeting via an audio webcast at www.virtualshareholdermeeting.com/IDXX2020. The online pre-meeting forum can be accessed before the 2020 Annual Meeting at www.proxyvote.com for beneficial owners and www.proxyvote.com/idxx for registered shareholders. At this online pre-meeting forum, you can submit questions in writing in advance of the 2020 Annual Meeting, vote, view the Rules of Conduct and Procedures relating to the 2020 Annual Meeting and access copies of the Company’s proxy materials and annual report.

Shareholders as of the close of business on March 9, 2020 are entitled to attend the 2020 Annual Meeting, vote their shares electronically and submit questions before and during the audio webcast. The Company will publish the answer to each question submitted by our shareholders on the Company’s Investor Relations website as soon as practicable after the meeting. An archived replay will also be available at www.virtualshareholdermeeting.com/IDXX2020 after the conclusion of the 2020 Annual Meeting and will remain available for one year. Further information on the 2020 Annual Meeting can be found in the Company’s proxy materials.

Zimmer Biomet Holdings to Present at the Bank of America Merrill Lynch 2020 Health Care Conference

On April 30, 2020 Zimmer Biomet Holdings, Inc. (NYSE and SIX: ZBH), a global leader in musculoskeletal healthcare, reported that President and CEO Bryan Hanson and Executive Vice President and Chief Financial Officer Suky Upadhyay will be participating in a fireside chat at the Bank of America Merrill Lynch 2020 Health Care Conference on Wednesday, May 13, at 10:20 a.m. Eastern Time.

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A live webcast of the presentation can be accessed via Zimmer Biomet’s Investor Relations website at https://investor.zimmerbiomet.com. The webcast will be archived for replay following the conference.

WuXi Biologics and Aravive Form Strategic Collaboration to Develop Novel High-Affinity Bispecific Antibodies Targeting Cancer and Fibrosis Using the WuXiBody™ Platform

On April 30, 2020 WuXi Biologics ("WuXi Bio") (2269.HK), a global company with leading open-access biologics technology platforms, and Aravive, Inc. (NASDAQ:ARAV), a clinical-stage biopharmaceutical company, reported a strategic collaboration agreement granting Aravive the right to use the proprietary WuXiBody platform to develop high-affinity bispecific antibodies for a target implicated in cancer and fibrosis (Press release, WuXi Biologics, APR 30, 2020, View Source [SID1234556881]).

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WuXi Biologics and Aravive will collaborate to discover antibodies against CCN2, a multidomain protein also known as connective tissue growth factor (CTGF). CCN2 was identified from a similar target discovery screen that identified the significance of the AXL/GAS6 pathway in cancer. Preclinical data identified CCN2 as important for tumor growth and progression.

WuXi Biologics will be responsible for biologics discovery, process development, and manufacturing. Aravive will be responsible for preclinical and clinical development. The companies did not disclose the financial terms of the collaboration.

"Aravive’s proficiency in development of anti-cancer and fibrotic drugs and WuXi Biologics’ expertise with biological discovery and manufacturing is a powerful combination," said Gail McIntyre, Ph.D., chief executive officer of Aravive. "We look forward to further expanding our collaboration to identify high affinity antibodies that can be exploited as anti-cancer and anti-fibrotic agents."

In 2018, and following the successful filing of a U.S. Investigational New Drug application (IND) for AVB-500, WuXi Biologics and Aravive announced expansion of their biologics manufacturing collaboration based on the rapid success achieved in the process development, scale-up and cGMP manufacture of Aravive’s lead drug candidate, AVB-500.

"We are glad to once again collaborate with Aravive as a trusted partner to accelerate the discovery, development and manufacturing of biologics through our innovative technology platforms," said Chris Chen, Ph.D., chief executive officer of WuXi Biologics. "WuXi Biologics’ proprietary antibody platforms including WuXiBody, are uniquely positioned to expedite development of novel bispecifics to benefit global patients."

About WuXiBody

WuXiBody is a leading proprietary bispecific antibody platform developed by WuXi Biologics. It can effectively break through the CMC barriers for many bispecific antibodies development with high expression yield, high stability, good solubility, and easy purification to homogeneity, expedite the process by 6-18 months and significantly reduce manufacturing costs, a limitation still faced by many other current bispecific platforms. WuXiBody Platform enables almost any mAb sequence pairs to be assembled into bispecific constructs, which are expected to have low immunogenicity risk and longer in vivo half-life. WuXiBody Platform also has a unique structural flexibility, which makes it convenient to build various formats with different combination of valencies (1+1, 1+2, 2+2) to meet the requirements of different target biologies.

Trio Pharmaceuticals, Inc. and Ajinomoto Bio-Pharma Services Enter into a Development Collaboration for a Novel Antibody Therapeutic

On April 30, 2020 Trio Pharmaceuticals, Inc. ("TRIO"), a cancer therapeutics company developing novel dual action antibody drugs, TRIObody, and novel dual action antibody drug conjugates, TRIObody Drug Conjugate (TDC) and Ajinomoto Bio-Pharma Services ("Aji Bio-Pharma"), a leading provider of biopharmaceutical contract development and manufacturing services, reported a development collaboration agreement to evaluate AJICAP, a proprietary site-specific conjugation technology offered by Aji Bio-Pharma for the development of TDCs (Press release, Trio Pharmaceuticals, APR 30, 2020, https://www.prnewswire.com/news-releases/trio-pharmaceuticals-inc-and-ajinomoto-bio-pharma-services-enter-into-a-development-collaboration-for-a-novel-antibody-therapeutic-301049693.html [SID1234556880]). The AJICAP technology will be used to conjugate a cytotoxic payload to TRIO’s lead oncology candidate with TRIO evaluating functionality of the TDC.

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TDCs are a first-in-class ADC with dual functionality. TRIO’s dual action TDC utilizes targeted payload delivery to stop both tumor growth and immunosuppression. By generating a less immunosuppressive tumor microenvironment, TDC enhances activation of tumor-specific immune effector cells further facilitating cancer cell destruction.

AJICAP is a robust site-specific conjugation technology compatible with varied antibody modalities. AJICAP’s advantage is its "off-the-shelf" feature, allowing any antibody drug at any stage of development to be conjugated to drug-payloads of choice without the need to modify the sequence. In contrast to traditional Cys-maleimide and Lys-succinimide conjugation technologies, AJICAP conjugation is robust and generates ADCs with high yields.

"We are very excited to collaborate with Aji Bio-Pharma for evaluating AJICAP to develop our proprietary dual action TDC. The AJICAP conjugation technology marks a new beginning in the ADC field, allowing generation of ADCs with site-specific conjugation without change in antibody sequence, a rate-limiting step in the development of site-specific ADCs. Setting an early collaboration with Aji Bio-Pharma will ease our cGMP plans for clinical development," noted Dr. Shiva Bhowmik, Founder + CEO of Trio Pharmaceuticals, Inc.

Dr. Brian Mendelsohn, Director, Process Development and Technology Transfer at Aji Bio-Pharma stated, "AJICAP was developed to create novel ADCs with therapeutic window enhancements, while shortening the development timeline. We are excited to collaborate with TRIO as they advance TDC technology, developing a new class of ADCs. This collaboration marks a new avenue of development in the ADC field."

Dr. Tatsuya Okuzumi, Associate General Manager, Business Development, Ajinomoto Co, Inc., added, "We are very excited to collaborate with TRIO in the development of dual action ADCs. As a member of the Ajinomoto Group, Aji Bio-Pharma houses a talented and dedicated team of ADC scientists and strong CMC capabilities, which will benefit TRIO’s development of this novel ADC."