On May 5, 2020 Arcus Biosciences, Inc. (NYSE:RCUS), an oncology-focused biopharmaceutical company working to create best-in-class cancer therapies, reported financial results for the first quarter ended March 31, 2020 and provided corporate updates (Press release, Arcus Biosciences, MAY 5, 2020, View Source [SID1234557026]).

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"We have continued to aggressively advance our unique portfolio of therapeutics that target three of the most highly pursued immuno-oncology pathways, TIGIT, the adenosine axis and PD-1, each of which we believe is significantly de-risked based on the totality of available internal and external biological and clinical data," said Terry Rosen, Ph.D., Chief Executive Officer. "Since the inception of the company, our vision has been to create, develop and commercialize best-in-class combination cancer therapies and expand on the availability of innovative treatment paradigms in the oncology space in hopes of substantially benefiting patients. Execution in the laboratory and clinic has placed us in an ideal position to deliver on this vision, with an ongoing flow of important data throughout the coming year."

"We would like to express our deepest gratitude to healthcare professionals, patients and their caregivers and all clinical operations personnel involved in our trials for their extraordinary commitment to advancing these new treatment options. Despite fighting on the front lines of the COVID-19 pandemic and the challenges posed by self-quarantine and public health measures, they continue to recognize the vital importance of our mission to advance best-in-class combination therapies in the pursuit of cures for patients with cancer, which still results in approximately 10 million deaths globally each year. As a result of the efforts of these dedicated individuals, we remain on track to generate preliminary Phase 1b expansion data in mid-2020 and randomized data starting in the fourth quarter of 2020, respectively, that will inform the advancement of our regulatory strategy."

Recent Key Highlights

Received U.S. Food & Drug Administration (FDA) clearance of an Investigational New Drug (IND) application to proceed with ARC-6, a prostate cancer platform trial evaluating various combinations of

AB928, AB680 and zimberelimab, alone or in combination with standard of care therapies, in patients with front-line to late-line metastatic castrate-resistant prostate cancer (mCRPC)

Completed enrollment of the first two cohorts in the dose-escalation portion of ARC-8, a trial evaluating the safety and tolerability of AB680, the first small-molecule CD73 inhibitor to enter the clinic, in combination with zimberelimab and gemcitabine/nab-paclitaxel in patients with pancreatic cancer

Anticipated Corporate Milestones

Initiation of enrollment in ARC-6, a Phase 1b/2 platform trial expanding our strategy in prostate cancer, evaluating various combinations of AB928, AB680 and zimberelimab, alone or in combination, with standard of care therapies for the treatment of mCRPC in the first half of 2020

Preliminary data from Phase 1b expansion trials investigating combinations with AB928 in multiple tumor types and settings, expected starting in mid-2020

Phase 1 data from the dose-escalation portion of ARC-8, a combination trial evaluating AB680 in first-line treatment of pancreatic cancer, with anticipated recommended dose for expansion to be established in mid-2020

Preliminary randomized data from two Phase 2 clinical collaborations with Genentech involving combination trials with AB928 in colorectal cancer and pancreatic cancer, expected in the fourth quarter of 2020

Preliminary randomized data from ARC-7, a Phase 2 trial involving AB154 with unique intra-portfolio combinations in first-line NSCLC, expected in the fourth quarter of 2020

Initiation of a Phase 1 clinical trial for at least one of our existing discovery/preclinical development programs in late 2020/early 2021

We continue to actively monitor the COVID-19 pandemic and its effects on our clinical trial operations, research and development programs, key vendors and employees. While we do not anticipate any modifications to the timelines above, this will depend on future developments which are currently unknown, including any new information that may emerge concerning the duration and/or severity of the crisis, any new actions by government authorities to contain the spread of the virus, and how quickly and to what extent normal economic and operating conditions can resume.

Financial Results for the First Quarter 2020

Cash, cash equivalents and investments in marketable securities were $157.9 million as of March 31, 2020, compared to $188.3 million at December 31, 2019. The decrease was due to the utilization of cash to fund our research, development and administrative operations. Based on our current operating plans, we anticipate that our cash, cash equivalents and investments will be sufficient to fund operations into mid-2021.

Revenues: Collaboration and license revenue was $1.8 million for the three months ended March 31, 2020 and 2019. The revenue was recognized from non-refundable upfront payments previously received from Taiho Pharmaceutical.

R&D Expenses: Research and development expenses were $23.1 million for the three months ended March 31, 2020, compared to $15.6 million for the same period in 2019. The increase in research and development expenses was due to increases in clinical costs for our ongoing clinical trials, as well as increases in employee compensation costs primarily due to additional headcount.

G&A Expenses: General and administrative expenses were $7.0 million for the three months ended March 31, 2020, compared to $5.0 million for the same period in 2019. The increase in general and administrative expenses was primarily due to an increase in G&A headcount and related costs.

Net Loss: Net loss was $27.8 million for the three months ended March 31, 2020, compared to $17.7 million for the same period in the prior year. The increase in net loss as compared to the prior period was primarily attributable to an increase in operating expenses as noted above.

On May 5, 2020 Exelixis, Inc. (Nasdaq: EXEL) reported financial results for the first quarter of 2020 and provided an update on progress toward fulfilling its key corporate objectives, as well as commercial and clinical development milestones (Press release, Exelixis, MAY 5, 2020, View Source [SID1234557025]).

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"Exelixis remained productive with strong performance in the first quarter of 2020, despite the significant challenges introduced by the COVID-19 pandemic in the U.S. and around the world," said Michael M. Morrissey, Ph.D., President and Chief Executive Officer of Exelixis. "I’m proud of the commitment demonstrated by our team to help patients with cancer fight their disease in these difficult times, while ensuring the safety of our employees and oncology healthcare professionals. Patient access to our medicines remains a top priority for Exelixis, both on the commercial and investigational fronts."

"Recently, we and our partner Bristol Myers Squibb announced positive top-line results from CheckMate -9ER, the pivotal phase 3 study evaluating the combination of nivolumab and cabozantinib in first-line RCC," continued Dr. Morrissey. "The trial met its primary endpoint of progression-free survival, as well as secondary endpoints of overall survival and objective response rate. Together with Bristol Myers Squibb, we are now moving rapidly to submit regulatory applications in the U.S. and European Union in the next few months. We look forward to continuing to provide updates on our other programs and milestones as the year progresses."

First Quarter 2020 Financial Results

Total revenues for the quarter ended March 31, 2020 were $226.9 million, compared to $215.5 million for the comparable period in 2019.

Total revenues for the quarter ended March 31, 2020 included net product revenues of $193.9 million, compared to $179.6 million for the comparable period in 2019. The increase in net product revenues reflected an increase in the average net selling price and an increase in sales volume.
Exelixis First Quarter 2020 Financial Results
Page 2 of 9
May 5, 2020

Collaboration revenues, comprising license revenues and collaboration services revenues, were $33.0 million for the quarter ended March 31, 2020, compared to $35.9 million for the comparable period in 2019. The decrease in collaboration revenues was primarily related to a decrease in the recognition of milestone related revenues, which was partially offset by higher royalty revenues for the sales of cabozantinib outside of the U.S. generated by Exelixis’ partner, Ipsen Pharma SAS (Ipsen).

Research and development expenses for the quarter ended March 31, 2020 were $101.9 million, compared to $63.3 million for the comparable period in 2019. The increase in research and development expenses was primarily related to the increases in clinical trial costs and personnel expenses. The increase in clinical trial costs was primarily due to costs associated with the expanding clinical trial program for cabozantinib, which includes COSMIC-312, COSMIC-313 and COSMIC-021. The increase in personnel expenses was primarily due to an increase in headcount to support Exelixis’ expanding discovery and development efforts.

Selling, general and administrative expenses for the quarter ended March 31, 2020 were $62.9 million, compared to $60.1 million for the comparable period in 2019. The increase in selling, general and administrative expenses was primarily related to increases in the Branded Prescription Drug Fee and personnel expenses, which were partially offset by decreases in marketing costs and corporate giving. The increase in personnel expenses was primarily due to an increase in administrative headcount to support Exelixis’ commercial and research and development organizations.

Provision for income taxes for the quarter ended March 31, 2020 decreased to $11.4 million, compared to $14.9 million for the comparable period in 2019, primarily due to a decrease in pre-tax income.

GAAP net income for the quarter ended March 31, 2020 was $48.6 million, or $0.16 per share, basic and $0.15 per share, diluted, compared to GAAP net income of $75.8 million, or $0.25 per share, basic and $0.24 per share, diluted, for the comparable period in 2019. The decrease in GAAP net income was primarily related to an increase in research and development expenses, which was partially offset by an increase in net product revenues.

Non-GAAP net income for the quarter ended March 31, 2020 was $59.4 million, or $0.19 per share, basic and $0.19 per share, diluted, compared to non-GAAP net income of $85.5 million, or $0.28 per share, basic and $0.27 per share, diluted, for the comparable period in 2019. Non-GAAP net income excludes stock-based compensation, adjusted for the related income tax effect.

Cash and investments increased $51.8 million during the quarter ended March 31, 2020 to over $1.4 billion.

Non-GAAP Financial Measures

To supplement Exelixis’ financial results presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP), Exelixis presents non-GAAP net income (and the related per share measures), which excludes from GAAP net income (and the related per share measures) stock-based compensation expense, adjusted for the related income tax effect for all periods presented.

Exelixis believes that the presentation of these non-GAAP financial measures provides useful supplementary information to, and facilitates additional analysis by, investors. In particular, Exelixis believes that these non-GAAP financial measures, when considered together with its financial information prepared in accordance with GAAP, can enhance investors’ and analysts’ ability to meaningfully compare Exelixis’ results from period to period, and to identify operating trends in Exelixis’ business. Exelixis has excluded stock-based compensation expense, adjusted for the related income tax effect, because it is a non-cash item that may vary significantly from period to period as a result of changes not directly or immediately related to the operational performance for the periods presented. Exelixis also regularly uses these non-GAAP financial measures internally to understand, manage and evaluate its business and to make operating decisions.

These non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. Exelixis encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP financial information and the reconciliation between these presentations, to more fully understand Exelixis’ business. Reconciliations between GAAP and non-GAAP results are presented in the tables of this release.

Cabozantinib Highlights

Continued Growth in Cabozantinib Franchise Net Product Revenues and Royalties. Net product revenues generated by the cabozantinib franchise in the U.S. were $193.9 million during the first quarter of 2020, an increase of 8.0% year-over-year, with net product revenues of $189.2 million from CABOMETYX and $4.7 million from COMETRIQ (cabozantinib). Based upon cabozantinib-related revenues generated by Exelixis’ partner Ipsen in the first quarter of 2020, Exelixis earned $17.9 million in royalty revenues.

Further Expansion of Prostate Cancer Cohort in Phase 1b COSMIC-021 Trial of Cabozantinib in Combination with Atezolizumab in Patients with Advanced Solid Tumors. In January 2020, Exelixis announced plans to further expand an existing metastatic castration-resistant prostate cancer (mCRPC) cohort (Cohort 6) of COSMIC-021, the phase 1b trial of cabozantinib in combination with atezolizumab in patients with locally advanced or metastatic solid tumors. Cohort 6, which was previously expanded from 30 to 80 patients in July 2019, will now include up to 130 patients.

Presentation of Clinical Results from CheckMate 040 Clinical Trial of the Combination of Cabozantinib and Nivolumab with or without Ipilimumab in Advanced Hepatocellular Carcinoma (HCC). In January 2020, Exelixis announced phase 1/2 clinical trial results from the combination of cabozantinib and nivolumab with or without ipilimumab in advanced HCC. Data from the cabozantinib combination cohort of the CheckMate 040 trial were presented on Friday, January 24th at American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper)’s (ASCO) (Free ASCO Whitepaper) Gastrointestinal Cancers Symposium, which was held in San Francisco, California. These data support Exelixis’ clinical development program of cabozantinib plus immune checkpoint inhibitors in advanced HCC, including the ongoing COSMIC-312 phase 3 pivotal trial of cabozantinib plus atezolizumab versus sorafenib in previously untreated patients.

Readout of Phase 1b COSMIC-021 Trial mCRPC Cohort at ASCO (Free ASCO Whitepaper)’s Genitourinary Cancers Symposium. In February 2020, Exelixis announced positive efficacy and safety results from an interim analysis of the mCRPC Cohort 6 of COSMIC-021. The data were presented on Thursday, February 13th at ASCO (Free ASCO Whitepaper)’s Genitourinary Cancers Symposium, which was held in San Francisco, California. Based on regulatory feedback from the U.S. Food and Drug Administration (FDA) and if supported by the clinical data from the recently expanded existing cohort and added mCRPC cohorts from COSMIC-021, Exelixis intends to file with the FDA for accelerated approval in an mCRPC indication as early as 2021.

Enrollment Completion of First 100 Patients in Phase 3 COSMIC-311 Pivotal Trial of Cabozantinib in Relapsed Radioiodine (RAI)-Refractory Differentiated Thyroid Cancer (DTC). In February 2020, Exelixis announced enrollment of the first 100 patients in COSMIC-311, a phase 3 pivotal trial evaluating CABOMETYX versus placebo in patients with RAI-refractory DTC who have progressed after up to two vascular endothelial growth factor receptor-targeted therapies.

Exelixis Partner Takeda Pharmaceutical Company Limited (Takeda) Receives Approval in Japan for CABOMETYX Tablets for the Treatment of Curatively Unresectable or Metastatic Renal Cell Carcinoma (RCC). In March 2020, Exelixis announced that Takeda, its partner responsible for the clinical development and commercialization of CABOMETYX in Japan, received approval from the Japanese Ministry of Health, Labour and Welfare to manufacture and market CABOMETYX as a treatment for patients with curatively unresectable or metastatic RCC. Cabozantinib continues to expand its global footprint, where it is currently approved in 55 countries.

Positive Top-line Results from Pivotal Phase 3 CheckMate -9ER Trial Evaluating Nivolumab in Combination with Cabozantinib in Previously Untreated Advanced RCC. In April 2020, Exelixis and Bristol Myers Squibb (BMS) announced that CheckMate -9ER, the pivotal phase 3 trial evaluating nivolumab in combination with cabozantinib compared to sunitinib in previously untreated advanced or metastatic RCC, met its primary endpoint of progression-free survival at final analysis, as well as the secondary endpoints of overall survival at a pre-specified interim analysis, and objective response rate. This preliminary analysis of data showed a favorable safety profile for the combination of a 40 mg dose of cabozantinib with nivolumab, with a low frequency of treatment discontinuations due to adverse events. Detailed results will be submitted for presentation at an upcoming medical conference.

Cabozantinib Data Presentations at the 2020 ASCO (Free ASCO Whitepaper) Annual Meeting. Cabozantinib will be the subject of 12 presentations at this year’s meeting, which has adopted a virtual format as a result of the COVID-19 pandemic. Data presentations will include results from non-small cell lung cancer (NSCLC), mCRPC and urothelial carcinoma
cohorts of COSMIC-021, as well as updates from other externally sponsored studies.

Corporate Updates

COVID-19 Update. To date, the COVID-19 pandemic has had a relatively modest impact on Exelixis’ business operations, in particular on Exelixis’ clinical trial and drug discovery activities, and the company is undertaking considerable efforts to mitigate the various problems presented by this crisis. For further details and descriptions of the COVID-19 pandemic’s actual impact, Exelixis’ mitigation efforts and the risks facing Exelixis if the COVID-19 pandemic continues and grows in severity, please see "Management’s Discussion and Analysis of Financial Condition and Results of Operations—COVID-19 Update" in Part I, Item 2 and "Risk Factors" in Part II, Item 1A of Exelixis’ Quarterly Report on Form 10-Q expected to be filed with the Securities and Exchange Commission on May 5, 2020.

Exelixis Outlines Key Priorities and Anticipated Milestones for 2020-21. In January 2020, Exelixis announced its key priorities and anticipated milestones for 2020-21, including generating top-line data from ongoing trials
new pivotal trials, and progressing its mid-stage and early pipeline, with up to three new investigational new drug filings in 2020. Subject to the challenges and risks of the Exelixis business, including a modest actual and potential additional impact from the ongoing COVID-19 pandemic, Exelixis is maintaining its guidance for clinical trial enrollment and top-line data timelines for COSMIC-311, COSMIC-312, COSMIC-313, COSMIC-021, EXAMINER and XL092, as well as for the initiation of three phase 3 pivotal trials evaluating cabozantinib in combination with atezolizumab in advanced NSCLC, mCRPC and RCC. Exelixis intends to make appropriate investments to maximize the clinical development opportunities for CABOMETYX, while concurrently working to advance a pipeline of potential new Exelixis medicines through internal drug discovery and business development.

George A. Scangos, Ph.D. Retires from Exelixis Board of Directors. In March 2020, Exelixis announced that George A. Scangos, Ph.D. notified the company of his decision to retire from the Exelixis Board of Directors. Dr. Scangos will not stand for re-election to the Board of Directors at the company’s 2020 Annual Meeting of Stockholders on May 20, 2020; his resignation from the Board will take effect that same day. Dr. Scangos cited his multiple professional and philanthropic commitments as principal reasons for his decision to retire from the Exelixis Board of Directors.

Exelixis Receives Notice of Additional Paragraph IV Certifications. Today, May 5, 2020, Exelixis received notice from MSN Pharmaceuticals, Inc. that it had amended its Abbreviated New Drug Application (ANDA), originally filed with the FDA in September 2019, to add two previously-unasserted CABOMETYX Orange Book-listed patents: U.S. Patent No. 7,579,473, the composition of matter patent, and U.S. Patent No. 8,497,284, a method of use patent. Exelixis is well prepared to respond and will vigorously defend its cabozantinib intellectual property estate.

Basis of Presentation

Exelixis has adopted a 52- or 53-week fiscal year that generally ends on the Friday closest to December 31st. For convenience, references in this press release as of and for the fiscal periods ended April 3, 2020, January 3, 2020 and March 29, 2019 are indicated as being as of and for the periods ended March 31, 2020, December 31, 2019 and March 31, 2019, respectively.

Conference Call and Webcast

Exelixis management will discuss the company’s financial results for the first quarter of 2020 and provide a general business update during a conference call beginning at 5:00 p.m. EDT / 2:00 p.m. PDT today, Tuesday, May 5, 2020.

To access the webcast link, log onto www.exelixis.com and proceed to the News & Events / Event Calendar page under the Investors & Media heading. Please connect to the company’s website at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to listen to the webcast. Alternatively, please call 855-793-2457 (domestic) or 631-485-4921 (international) and provide the conference call passcode 8465574 to join by phone.

A telephone replay will be available until 8:00 p.m. EDT on May 7, 2020. Access numbers for the telephone replay are: 855-859-2056 (domestic) and 404-537-3406 (international); the passcode is 8465574. A webcast replay will also be archived on www.exelixis.com for one year.

On May 5, 2020 Perrigo Company plc (NYSE; TASE: PRGO) reported that President and CEO Murray S. Kessler will present as part of the Goldman Sachs Global Staples Forum Webcast at 8:10 AM EST on Monday, May 18, 2020 (Press release, Perrigo Company, MAY 5, 2020, View Source [SID1234557023]). Interested parties can access the presentation webcast at View Source

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On May 5, 2020 Clovis Oncology, Inc. (NASDAQ:CLVS) reported financial results for the quarter ended March 31, 2020, and provided an update on the Company’s clinical development programs and regulatory and commercial outlook for the rest of the year (Press release, Clovis Oncology, MAY 5, 2020, View Source [SID1234557022]).

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"We are pleased with our sales growth in the first quarter and believe that Rubraca is well-positioned as an oncology treatment option in the COVID-19 era," said Patrick J. Mahaffy, President and CEO of Clovis Oncology. "While we may see some impact on near-term revenues as oncology practices and patients adjust to the impact of this virus in the U.S. and Europe, it is obvious that cancer patients will continue to be diagnosed and treated given the evident risks in not actively managing their disease. We believe that Rubraca has significant advantages as a maintenance option in an environment in which physicians are trying to reduce patient visits to their clinics. Rubraca is an oral agent and is both delivered directly to and taken at home. Unlike observation, which on average requires a return to immunosuppressive chemotherapy after approximately five months, Rubraca has proven to extend progression-free survival by independent assessment on average nearly fourteen months. And finally, Rubraca only requires monthly routine monitoring. In addition to seeking to establish Rubraca as the maintenance treatment option of choice in recurrent ovarian cancer, we also look forward to the potential launch in the United States of Rubraca in BRCA1/2-mutant recurrent, metastatic castrate-resistant prostate cancer."

First Quarter 2020 Financial Results

Clovis reported product revenue for Rubraca of $42.6 million for the first quarter of 2020, which included U.S. product revenue of $39.3 million and ex-U.S. product revenue of $3.3 million. This compares to product revenue for Rubraca of $33.1 million for the first quarter of 2019, which included U.S. product revenue of $31.9 million and ex-U.S. product revenue of $1.2 million. This represents a 29 percent increase year over year and 8 percent increase sequentially compared to Q4 2019 product revenue of $39.3 million. U.S. product revenues were up nine percent over the $36.1 million reported in Q4 2019 and ex-U.S. product revenue increased two percent from $3.2 million reported in Q4 2019.

Clovis had $228.4 million in cash, cash equivalents and available-for-sale securities as of March 31, 2020.

In January 2020, the Company repurchased $123.4 million aggregate principal amount of its 4.50% convertible senior notes due 2024 that were initially issued in August 2019. In April 2020, the Company exchanged approximately $36.05 million in aggregate principal amount of its 4.50% convertible senior notes due 2024 for approximately $32.77 million in aggregate principal of 2021 notes. In May 2020, a holder of the 4.50% convertible senior notes due 2024 converted $24.3 million par value of notes into approximately 3.3 million shares of common stock per the standard terms of the indenture. Following these transactions, approximately $64.42 million aggregate principal amount of these 2021 notes remain outstanding and approximately $150.63 million aggregate principal amount of these 2024 notes remain outstanding. Additionally, the Company has $300 million aggregate principal amount outstanding of its 1.25% convertible senior notes due 2025. As a result of the transactions noted above, the Company has reduced its total outstanding convertible debt by $145.1 million in outstanding principal amount from December 31, 2019 through May 5, 2020.

As of March 31, 2020, the Company had drawn approximately $50 million under the TPG ATHENA clinical trial financing and had up to $125 million available to draw under the agreement to fund the expenses of the ATHENA trial through Q3 2022.

Based on the Company’s anticipated revenues, spending, available financing sources and existing cash, cash equivalents and available-for-sale securities, the Company believes it has sufficient cash, cash equivalents and available-for-sale securities to fund its operating plan into the second half of 2021. This does not include any cash repayment that may be required to pay off (unless refinanced earlier) the remaining $64.42 million aggregate principal amount of the 2.50% convertible notes, at their maturity in September 2021. While we have not yet seen a material impact on our revenues, the effects of COVID-19 on future sales are difficult to assess or predict.

Net cash used in operating activities was $82.5 million for the first quarter of 2020, compared with $98.5 million for the first quarter of 2019. Borrowings under the TPG ATHENA financing provided $15.6 million in Q1 2020, reducing net cash utilized in operating activities to $66.9 million in Q1 2020. Net cash used in operating activities for Q1 2020 included product supply costs of $12.4 million. We expect product supply costs will be significantly reduced from this first quarter level for the remainder of 2020 and at least the first half of 2021.

Clovis reported a net loss for the first quarter of 2020 of $99.3 million, or ($1.39) per share, compared to the net loss for the first quarter of 2019 which was $86.4 million, or ($1.63) per share. Net loss for the first quarter of 2020 included share-based compensation expense of $13.0 million, compared to $13.6 million for the first quarter of 2019.

Research and development expenses totaled $68.2 million for the first quarter of 2020, compared to $62.0 million for the first quarter of 2019. Research and development expenses increased during the three months ended March 31, 2020 compared to the same period in the prior year primarily due to higher research and development costs for Rubraca. We expect research and development expenses to be lower in the full year 2021 compared to full year 2020.

Selling, general and administrative expenses totaled $42.6 million for the first quarter of 2020, compared to $47.8 million for the comparable period in 2019. Selling, general and administrative expenses decreased during the three months ended March 31, 2020 compared to the same period in the prior year primarily due to decreased commercialization expenses for Rubraca in the U.S. and Europe. We expect savings in selling, general and administrative expenses as a result of the COVID-19 situation globally.

European Launch of Rubraca in Ovarian Cancer

In January 2019, the European Commission granted a variation to the marketing authorization for Rubraca to include the maintenance treatment of adult patients with recurrent epithelial ovarian, fallopian tube, or primary peritoneal cancer who are in a complete or partial response to platinum-based chemotherapy. Following successful reimbursement negotiations, Clovis has launched Rubraca in each of Germany, United Kingdom, Italy, France and Spain, and over time expects to launch in additional smaller European markets.

U.S. Supplemental New Drug Application for Rubraca in BRCA1/2-mutant Metastatic Castration-resistant Prostate Cancer (mCRPC)

In January 2020, Clovis announced that the FDA accepted the Company’s supplemental New Drug Application (sNDA) for Rubraca as a monotherapy treatment of adult patients with BRCA1/2-mutant recurrent, metastatic castrate-resistant prostate cancer and granted priority review status to the application with a Prescription Drug User Fee Act (PDUFA) date of May 15, 2020. The sNDA filing, submitted in November 2019, was based on data from the TRITON clinical program in advanced prostate cancer. The Company is actively preparing for the launch of Rubraca in prostate cancer in the U.S. to commence upon receipt of FDA approval. Given the ongoing quarantine in the U.S., this product launch will be among the first virtual-only launches in oncology.

Lucitanib Combination Studies Underway

Two Clovis-sponsored early Phase 1b/2 lucitanib combination studies are currently underway: LIO-1, evaluating lucitanib and nivolumab in combination in advanced solid tumors (Phase 1b) and gynecologic cancers (Phase 2); and lucitanib in combination with rucaparib in advanced solid tumors (Phase 1b) and ovarian cancer (Phase 2) as an arm of the SEASTAR study. Clovis anticipates submitting abstracts for presentations at medical meetings in the Fall of 2020.

Conference Call Details

Clovis will hold a conference call to discuss Q1 2020 results this afternoon, May 5, at 4:30pm ET. The conference call will be simultaneously webcast on the Clovis Oncology web site www.clovisoncology.com, and archived for future review. Dial-in numbers for the conference call are as follows: US participants (866) 393-4306, International participants (734) 385-2616, conference ID: 1140127.

About Rubraca (rucaparib)

Rubraca is an oral, small molecule inhibitor of PARP1, PARP2 and PARP3 being developed in ovarian cancer as well as several additional solid tumor indications. Studies open for enrollment or under consideration include ovarian, prostate, breast, gastroesophageal, pancreatic, and lung cancers. Clovis holds worldwide rights for Rubraca.

In the United States, Rubraca is approved for the maintenance treatment of adult patients with recurrent epithelial ovarian, fallopian tube, or primary peritoneal cancer who are in a complete or partial response to platinum-based chemotherapy. Rubraca is also approved in the United States for the treatment of adult patients with deleterious BRCA mutation (germline and/or somatic) associated epithelial ovarian, fallopian tube, or primary peritoneal cancer who have been treated with two or more chemotherapies and selected for therapy based on an FDA-approved companion diagnostic for Rubraca.

In Europe, Rubraca is approved for the maintenance treatment of adults with platinum-sensitive relapsed high-grade epithelial ovarian, fallopian tube, or primary peritoneal cancer who are in response (complete or partial) to platinum-based chemotherapy. Rubraca is also approved in Europe for the treatment of adult patients with platinum sensitive, relapsed or progressive, BRCA mutated (germline and/or somatic), high-grade epithelial ovarian, fallopian tube, or primary peritoneal cancer, who have been treated with two or more prior lines of platinum-based chemotherapy, and who are unable to tolerate further platinum-based chemotherapy.

Rubraca is an unlicensed medical product outside of the U.S. and Europe.

About Lucitanib

Lucitanib is an oral, potent inhibitor of the tyrosine kinase activity of vascular endothelial growth factor receptors 1 through 3 (VEGFR1-3), platelet-derived growth factor receptors alpha and beta (PDGFRα/β) and fibroblast growth factor receptors 1 through 3 (FGFR1-3). Emerging clinical data support the combination of angiogenesis inhibitors and immunotherapy to increase effectiveness in multiple cancer indications. Angiogenic factors, such as vascular endothelial growth factor (VEGF), are frequently up-regulated in tumors and create an immunosuppressive tumor microenvironment. Use of antiangiogenic drugs reverses this immunosuppression and can augment response to immunotherapy.

Lucitanib is an unlicensed medical product.

About FAP-2286

FAP-2286 is a preclinical candidate discovered by 3B Pharmaceuticals under investigation as a peptide-targeted radionuclide therapy (PTRT) and imaging agent targeting fibroblast activation protein alpha (FAP). FAP is highly expressed in many epithelial cancers, including more than 90 percent of breast, lung, colorectal and pancreatic carcinomas. Clovis is planning to submit an investigational new drug application (IND) for FAP-2286 in the second half of 2020. Clovis will conduct the global clinical trials and holds U.S. and global rights, excluding Europe.

FAP-2286 is an unlicensed medical product.

On May 5, 2020 Cerus Corporation (Nasdaq: CERS) reported financial results for the first quarter ended March 31, 2020 (Press release, Cerus, MAY 5, 2020, View Source [SID1234557021]).

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Recent developments and highlights include:

Total first quarter 2020 revenue of $24.6 million
Quarterly product revenue of $18.6 million, a 6% increase compared to the prior year quarter
Global demand for INTERCEPT kits grew during the first quarter with the calculated number of treatable platelet doses up 14% compared to the same period in 2019
Government contract revenue of $6.0 million
Reaffirming 2020 full year product revenue guidance range of $89 million to $93 million representing an approximately 20% to 25% increase over 2019 reported product revenue.
Strengthened balance sheet with a $63.3 million public offering of common stock. At March 31, 2020, the Company had cash, cash equivalents and short-term investments of $133.1 million.
Announced strategic organizational changes to align teams around key commercial growth and product portfolio pipeline development targets.
Formed a collaborative research group with the aim of optimizing the characteristics and dosing of convalescent plasma as a potential therapy for COVID-19 patients.
Further strengthened the Company’s collaboration with the Biomedical Advanced Research and Development Authority (BARDA) with an incremental $14 million available under the contract.
"First quarter product revenue of $18.6 million exceeded our internal expectations despite the tumultuous macro environment created by the global COVID-19 pandemic. The emergence of SARS-CoV-2 has highlighted the need for comprehensive preparedness planning for healthcare systems and the corresponding obligation to safeguard the blood supply chain. The INTERCEPT Blood System has played a critical role for many blood centers by reducing the risk of transfusion transmitted infections," said William ‘Obi’ Greenman, Cerus’ president and chief executive officer. "In the face of this crisis, I am proud of the actions taken by the Cerus employees designed to make sure that the blood centers and hospitals have access to INTERCEPT Blood System, even in the regions hardest hit by the pandemic."

"It is unclear as to the extent and duration that the COVID-19 impact will have on the global transfusion medicine industry and on healthcare in general, but given the critical need for blood and blood components, we are cautiously optimistic about the health of our business and our ability to further our mission to make INTERCEPT the standard of care," continued Greenman.

Revenue

Product revenue during the first quarter of 2020 was $18.6 million, compared to $17.5 million during the same period in 2019. Revenue growth during the quarter benefited from increased demand for INTERCEPT platelet kit sales in the U.S., offset partially by the year-over-year product mix shift in France and a decrease in kit sales in the Middle East due to the timing of distributor orders.

Government contract revenue from the Company’s BARDA agreement was $6.0 million during the first quarter of 2020, compared to $4.5 million during the same period in 2019, as a result of increasing INTERCEPT red blood cell development activities. With the recently announced amendment, the total potential value of the current BARDA agreement is now $214 million with $50 million recognized as revenue to date.

BARDA is part of the Office of the Assistant Secretary for Preparedness and Response within the U.S. Department of Health and Human Services. The development of the INTERCEPT red blood cell program has been funded in whole or in part with federal funds from the Department of Health and Human Services; Office of the Assistant Secretary for Preparedness and Response; Biomedical Advanced Research and Development Authority, under Contract No. HHSO100201600009C.

Gross Margins

Gross margins on product revenue during the first quarter of 2020 were 55%, compared to 52% for the first quarter of 2019. Gross margins during the quarter benefited from continued economies of scale and resulting lower per unit costs, driven by increased manufacturing production to meet existing and expected future growth in demand for INTERCEPT.

Operating Expenses

Total operating expenses for the first quarter 2020 were $31.7 million compared to $29.6 million for the same period the prior year.

Selling, general, and administrative (SG&A) expenses for the first quarter of 2020 totaled $15.9 million, compared to $16.2 million for the first quarter of 2019. The year-over-year decline was primarily due to lower marketing and travel related expenses, both driven in part by the COVID-19 pandemic.

Research and development (R&D) expenses for the first quarter of 2020 were $15.8 million, compared to $13.4 million for the first quarter of 2019. The increase in year-over-year R&D expenses were primarily due to increased costs associated with initiatives for expanded INTERCEPT platelet label claims and costs for our red blood cell program, namely activities under our BARDA agreement.

Net Loss

Net loss for the first quarter of 2020 was $16.5 million, or $0.10 per diluted share, compared to a net loss of $18.8 million, or $0.14 per diluted share, for the first quarter of 2019.

Cash, Cash Equivalents and Investments

At March 31, 2020, the Company had cash, cash equivalents and short-term investments of $133.1 million, compared to $85.7 million at December 31, 2019.

At March 31, 2020, the Company had approximately $39.5 million in outstanding term loan debt compared to $39.4 million at December 31, 2019.

2020 Product Revenue Guidance

The Company expects 2020 product revenue to be in the range of $89 million to $93 million, unchanged from the prior guidance originally provided on January 13, 2020. The guidance range represents approximately 20% to 25% growth compared to 2019 reported product revenue.

QUARTERLY CONFERENCE CALL

The Company will host a conference call and webcast at 4:30 P.M. EDT this afternoon, during which management will discuss the Company’s financial results and provide a general business overview and outlook. To access the live webcast, please visit the Investor Relations page of the Cerus website at View Source Alternatively, you may access the live conference call by dialing (866) 235-9006 (U.S.) or (631) 291-4549 (international).

A replay will be available on the Company’s website, or by dialing (855) 859-2056 (U.S.) or (404) 537-3406 (international) and entering conference ID number 8484403. The replay will be available approximately three hours after the call through May 19, 2020.