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Ayala’s IPO Raises $55M to Test Two Former Bristol Myers Cancer Drugs

On May 8, 2020 Ayala Pharmaceuticals reported that it has two clinical-stage cancer drugs licensed from Bristol Myers Squibb (Press release, Ayala Pharmaceuticals, MAY 8, 2020, View Source [SID1234557442]). Now it has $55 million to take those drugs further than the pharmaceutical giant did.

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On Thursday evening, Ayala priced its IPO, which consisted of 3.7 million shares sold for $15 each. That price was the midpoint of the targeted $14 to $16 per share range, but the Rehovot, Israel-based company was able to increase the number of shares in the offering by 10 percent. Ayala is expected to begin trading on the Nasdaq Friday under the stock symbol "AYLA."

Ayala’s lead candidate, AL101, is an injectable small molecule that blocks gamma secretase, an enzyme that activates the Notch signaling pathway. This pathway plays a role in both solid tumors and blood cancers. Bristol (NYSE: BMY) had tested the drug in three Phase 1 studies—all of them failures.

Ayala is trying for a better outcome. In its prospectus, the company says patients in the Bristol studies weren’t selected according to whether their cancers were characterized by Notch activation. Ayala uses DNA sequencing technology to identify patients whose cancers are most likely to respond to AL101. The company is currently testing the drug in an open-label Phase 2 study enrolling patients with adenoid cystic carcinoma, a rare form of cancer affecting secretary glands, such as the salivary glands.

Of the estimated 3,400 patients who have adenoid cystic carcinoma, Ayala says about 1,700 have disease that is recurrent or metastatic. The company calculates that 18 to 20 percent of these patients have cancers with Notch-activating mutations. There are no FDA-approved drugs for this cancer.

As of April 28, Ayala has some early data safety and efficacy data from its Phase 2 test of AL101, according to the prospectus. Additional data will be presented at medical conferences in the second half of this year. Ayala also plans to test AL101 in two other cancers characterized by Notch pathway activation: triple negative breast cancer and acute lymphoblastic leukemia.

Ayala’s second compound, an oral drug called AL102, is also a gamma secretase inhibitor. The company is developing the former Bristol compound as a treatment for desmoid tumors, which occur in connective tissue. There are currently no FDA-approved therapies for desmoid tumors, though SpringWorks Therapeutics (NASDAQ: SWTX) is in the hunt testing a drug licensed from Pfizer (NYSE: PFE). The SpringWorks compound is in Phase 3 testing. Ayala plans to start a Phase 2 trial for its desmoid tumor drug candidate in the second half of this year.

AL102 is also being developed as a potential treatment for multiple myeloma under a partnership with Novartis (NYSE: NVS). The plan is to evaluate the drug in combination with Novartis’s B-cell maturation antigen therapies. The agreement gives the Swiss pharma giant the option to license the Ayala drug. A Phase 1 study has started but patients have not yet been dosed, according to the prospectus. The agreement calls for Novartis to pay up to $4.3 million of Ayala’s research and development expenses.

Ayala plans to use $13 million to $14 million to advance AL101 through the adenoid cystic carcinoma Phase 2 study, the company says in its IPO documents. Another $11 million to $12 million is earmarked for the planned mid-stage study in triple negative breast cancer; $6 million to $7 million for the acute lymphoblastic leukemia test. AL102 will require $7 million to $8 million for the Phase 2 study in desmoid tumors.

Ayala formed in 2017, the same year it licensed AL101 and AL102 from Bristol. The biotech says it has raised $46.3 million since its launch. The company’s largest shareholder is Israel Biotech Fund, which holds a 25.5 percent post-IPO stake, according to the prospectus. Novartis owns 5.2 percent of the biotech; Bristol 4.6 percent.

Akebia Therapeutics to Present at RBC Capital Markets Global Healthcare Virtual Conference

On May 8, 2020 Akebia Therapeutics, Inc. (Nasdaq: AKBA), a biopharmaceutical company with the purpose to better the lives of people impacted by kidney disease, reported that its President and Chief Executive Officer, John P. Butler, will participate in the 2020 RBC Capital Markets Global Healthcare Virtual Conference on Wednesday, May 20 at 10:20 a.m. ET (Press release, Akebia, MAY 8, 2020, View Source [SID1234557413]). A live webcast and replay of Akebia’s presentation will be available on the Company’s website at www.akebia.com.

Immunic, Inc. Reports First Quarter 2020 Financial Results and Highlights Recent Activity

On May 8, 2020 Immunic, Inc. (Nasdaq: IMUX), a clinical-stage biopharmaceutical company focused on developing best-in-class, oral therapies for the treatment of chronic inflammatory and autoimmune diseases, reported financial results for the first quarter ended March 31, 2020 and highlighted recent activity (Press release, Immunic, MAY 8, 2020, View Source [SID1234557435]).

"The global coronavirus disease 2019 (COVID-19) pandemic has led to a period of intense, additional focus for Immunic, as we quickly recognized the potential of our lead asset, selective oral DHODH inhibitor, IMU-838, as a possible therapeutic for the treatment of severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) infections, given its already well-recognized, broad-spectrum antiviral effects," stated Daniel Vitt, Ph.D., Chief Executive Officer and President of Immunic. "After performing preclinical testing, we recently announced that, in cellular assays, IMU-838 successfully demonstrated antiviral activity against SARS-CoV-2 at blood concentrations which are well below those associated with IMU-838 dosing regimens studied in our ongoing and previous clinical trials. Based on these positive results, we are preparing a phase 2 clinical development program for IMU-838 as a potential treatment for this devastating disease."

Dr. Vitt continued, "On the heels of this encouraging preclinical data, we were able to bolster our financial position with a successful $15.0 million financing. As a result, we expect to be well funded through key, near-term milestones including top-line data from both our phase 2 trial of IMU-838 for relapsing-remitting multiple sclerosis (RRMS), expected in the third quarter of this year, as well as results from the investigator-sponsored phase 2 trial for IMU-838 in primary sclerosing cholangitis (PSC), expected in early 2021."

First Quarter 2020 and Subsequent Highlights

April 2020: Completed a $15.0 million registered direct offering led by institutional investor, Altium Capital.
April 2020: Announced that lead asset, IMU-838, has successfully demonstrated preclinical activity against clinical isolates of SARS-CoV-2 associated with COVID-19. As a result, the company is now exploring the feasibility of conducting a prospective, multicenter, randomized, placebo-controlled, double-blind phase 2 clinical trial in patients with moderate COVID-19.
April 2020: Reported several changes to the company’s executive team, including the resignation of Chief Financial Officer, Sanjay S. Patel, CFA, and the promotion of Glenn Whaley to the position of Vice President Finance, Principal Financial and Accounting Officer. Additionally, announced that Duane Nash, MD, JD, MBA, current Chairman of the Board of Directors, has temporarily assumed the role of Executive Chairman.
January 2020: Exercised option to obtain the exclusive worldwide rights to commercialization of a group of compounds, designated by the company as IMU-856, aimed at restoring intestinal barrier function, from Daiichi Sankyo Co., Ltd.
Anticipated Clinical Milestones

Top-line data from the phase 2 EMPhASIS trial of IMU-838 in RRMS is expected to be available in the third quarter of 2020.
Completion of preclinical and manufacturing activities necessary for initiation of phase 1 clinical studies of IMU-856 are expected during the first half of 2020.
The current, single ascending dose part of the ongoing phase 1 trial of IMU-935, being conducted in Australia, is planned to be followed by a multiple ascending dose (MAD) portion in healthy volunteers and a safety evaluation in patients with mild-to-moderate psoriasis as a third part of this phase 1 trial. Based on the temporary pausing of trials in healthy volunteers imposed by Ethics Committees in Australia due to COVID-19, the MAD portion of the trial is expected to start in the second half of 2020.
Top-line data from the phase 2, investigator-sponsored proof-of-concept clinical trial for IMU-838 in PSC, being conducted at the Mayo Clinic, is expected to be available in early 2021.
Top-line data from the phase 2 CALDOSE-1 trial in ulcerative colitis (UC) is expected to be available during the fourth quarter of 2021.
Upcoming Events

Immunic will host a virtual R&D Day on May 19, 2020. Immunic’s management and invited key opinion leaders, specializing in multiple sclerosis and inflammatory bowel disease, will discuss today’s treatment options for, and the unmet medical needs of, chronic inflammatory and autoimmune diseases, as well as clinical progress of the company’s selective oral immunology programs and their potential advantages over the current treatment landscape. Management will also discuss the company’s COVID-19 program.
Financial and Operating Results

Research and Development (R&D) Expenses were $6.4 million for the three months ended March 31, 2020, as compared to $3.4 million for the same period ended March 31, 2019. The $3.1 million increase was primarily attributable to (i) increased development costs for the phase 2 clinical trials of IMU-838 in RRMS and UC, the IMU-935 phase 1 clinical trial, and preclinical activities with IMU-856, (ii) increased employee costs related to the growth in headcount and (iii) other expenses.
General and Administrative (G&A) Expenses were $2.6 million for the three months ended March 31, 2020, as compared to $1.3 million for the same period ended March 31, 2019. The $1.3 million increase is primarily due to becoming a public company and expanding operations into the United States.
Other Income was $0.5 million for the three months ended March 31, 2020, as compared to $0.3 million for the same period ended March 31, 2019. The $0.2 million increase is primarily attributable to research and development tax incentives for clinical trials in Australia as a result of increased spending on clinical trials in Australia.
Net Loss for the three months ended March 31, 2020 was approximately $8.5 million, or $0.79 per basic and diluted share, based on 10,749,460 weighted average common shares outstanding, compared to a net loss of approximately $4.3 million, or $5.09 per basic and diluted share, based on 846,953 weighted average common shares outstanding for the same period ended March 31, 2019.
Cash and Cash Equivalents, as of March 31, 2020, were $18.6 million. With these funds and the money raised in equity issuances in April 2020, including approximately $13.9 million in net proceeds from the registered direct offering closed on April 27, 2020, and an additional $2.3 million in net proceeds from ATM issuances, the company expects to be able to fund operations beyond twelve months from the date of the issuance of this earnings release.

Luminex Corporation Announces Pricing Of Offering Of $260 Million Of 3.00% Convertible Senior Notes Due 2025

On May 8, 2020 Luminex Corporation (NASDAQ: LMNX) ("Luminex") reported the pricing of its offering of $260,000,000 aggregate principal amount of 3.00% Convertible Senior Notes due 2025 (the "Convertible Notes") in a private placement pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act") (Press release, Luminex, MAY 8, 2020, View Source;301055557.html [SID1234557434]). The delivery of the Convertible Notes to investors in book-entry form is expected to be made on May 13, 2020, and is expected to result in approximately $218.3 million in net proceeds to Luminex after deducting estimated placement agent’s fees, the net cost of the bond hedge and warrant transactions discussed below, and estimated offering expenses payable by Luminex.

The Convertible Notes will be general unsecured obligations of Luminex and interest will be paid semiannually in arrears on May 15 and November 15 of each year, beginning on November 15, 2020. The Convertible Notes will mature on May 15, 2025, unless earlier repurchased, redeemed or converted. Prior to the close of business on the business day immediately preceding November 15, 2024, the Convertible Notes will be convertible at the option of holders only upon the satisfaction of certain conditions and during certain periods. On or after November 15, 2024 until close of business on the second scheduled trading day preceding maturity, the Convertible Notes will be convertible at the option of the holders at any time regardless of these conditions. Conversions of Convertible Notes will be settled in cash, shares of Luminex’s common stock or a combination thereof, at Luminex’s election. The Convertible Notes will not be redeemable prior to maturity.

The initial conversion rate is 22.8918 shares of common stock per $1,000 principal amount of Convertible Notes (equivalent to an initial conversion price of approximately $43.68 per share of Luminex’s common stock). The conversion rate and the corresponding conversion price will be subject to adjustment upon the occurrence of certain events, but will not be adjusted for any accrued and unpaid interest.

If Luminex undergoes a fundamental change (as defined in the indenture governing the Convertible Notes), holders may require Luminex to purchase for cash all or part of their Convertible Notes at a purchase price equal to 100% of the principal amount of the Convertible Notes to be purchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. In addition, if certain make-whole fundamental changes occur, Luminex will, in certain circumstances, increase the conversion rate for any Convertible Notes converted in connection with such make-whole fundamental change.

In addition, in connection with the pricing of the Convertible Notes, Luminex entered into privately negotiated convertible note hedge transactions and warrant transactions with certain dealers (the "Option Counterparties"). The convertible note hedge transactions are expected generally to reduce the potential dilution to Luminex’s common stock upon any conversion of Convertible Notes and/or offset any cash payments Luminex is required to make in excess of the principal amount of converted Convertible Notes, as the case may be, in each case upon conversion of the Convertible Notes. The warrant transactions could separately have a dilutive effect to the extent that the market price per share of Luminex’s common stock exceeds the applicable strike price of the warrants. However, subject to certain conditions, Luminex may elect to settle all or a portion of the warrants in cash. The strike price of the warrant transactions will initially be approximately $69.89 per share, which represents a premium of approximately 80% over the last reported sale price of Luminex’s common stock on May 7, 2020, and is subject to certain adjustments under the terms of the warrant transactions.

Luminex expects that in connection with establishing their initial hedges of these transactions, the Option Counterparties and/or their respective affiliates will enter into various derivative transactions with respect to Luminex’s common stock and/or purchase Luminex’s common stock in secondary market transactions concurrently with, or shortly after, the pricing of the Convertible Notes. This activity could increase (or reduce the size of any decrease in) the market price of Luminex’s common stock or the Convertible Notes at that time. In addition, Luminex expects that the Option Counterparties and/or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to Luminex’s common stock and/or purchasing or selling Luminex’s common stock or other securities of Luminex in secondary market transactions following the pricing of the Convertible Notes and prior to the maturity of the Convertible Notes (and are likely to do so following conversion of the Convertible Notes or during any observation period related to a conversion of Convertible Notes). These activities could also cause or avoid an increase or a decrease in the market price of Luminex’s common stock or the Convertible Notes, which could affect the ability of holders of Convertible notes to convert the Convertible Notes and, to the extent the activities occur following conversion or during any observation period related to a conversion of the Convertible Notes, could affect the amount of cash and/or the number and value of shares of Luminex’s common stock that holders will receive upon conversion of the Convertible Notes.

Luminex intends to use approximately $34.7 million of the net proceeds from the private placement to pay the net cost of the convertible note hedge transactions (after such cost is partially offset by the proceeds to Luminex from the warrant transactions). Luminex intends to use the remaining net proceeds of the offering for working capital and other general corporate purposes.

The private placement is only being made pursuant to Section 4(a)(2) under the Securities Act to purchasers that are both "institutional accredited investors" (as defined in Rule 501 promulgated under the Securities Act) and "qualified institutional buyers" (as defined in Rule 144A under the Securities Act). Neither the Convertible Notes nor any shares of Luminex’s common stock issuable upon conversion of the Convertible Notes have been or are expected to be registered under the Securities Act or under any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws.

Mylan to Present at the BofA Securities Virtual Health Care Conference 2020

On May 8, 2020 Global pharmaceutical company Mylan N.V. (NASDAQ: MYL) reported that President Rajiv Malik and Chief Financial Officer Ken Parks will present at the BofA Securities Virtual Health Care Conference 2020 on Thursday, May 14, 2020 at 3:40 p.m. ET (Press release, Mylan, MAY 8, 2020, View Source [SID1234557433]).

Interested parties can access a live webcast of the presentation via the investor relations section of Mylan’s website at investor.mylan.com. An archived version also will be available following the live presentation and can be accessed at the same location for a limited time.