On November 6, 2019 BioCryst Pharmaceuticals, Inc. (Nasdaq:BCRX) reported financial results for the third quarter ended September 30, 2019 and provided a corporate update (Press release, BioCryst Pharmaceuticals, NOV 6, 2019, View Source [SID1234550408]).

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"BioCryst is positioned for a transformational 2020, with the potential approval and launch of BCX7353 in the U.S., regulatory filings for BCX7353 in Japan and Europe, and data from our PNH proof of concept study with BCX9930 reading out in the first half of the year," said Jon Stonehouse, president and chief executive officer of BioCryst.

"We are also actively evaluating multiple approaches to add capital to the balance sheet by the end of 2019, as we did with the Japanese licensing agreement for BCX7353, which we announced earlier this week," Stonehouse added.

Upcoming Key Milestones

HAE Program – BCX7353

Submit a new drug application (NDA) for oral, once-daily BCX7353 for the prevention of hereditary angioedema (HAE) attacks with the U.S. Food and Drug Administration (FDA) (Q4 2019)

Submit a marketing authorization application for oral, once-daily BCX7353 for the prevention of HAE attacks with the Japanese Pharmaceuticals and Medical Devices Agency (PMDA) and the European Medicines Agency (EMA) (Q1 2020)

Commence ZENITH-2, a Phase 3 clinical trial of oral BCX7353 (750 mg) for the treatment of acute HAE attacks, in 2020, pending the completion of interactions with regulators on the Phase 3 program and additional work on the acute oral formulation (2020)
Complement Oral Factor D Inhibitor Program – BCX9930

Report data from a proof of concept study in paroxysmal nocturnal hemoglobinuria (PNH) patients receiving oral BCX9930 (1H 2020)
ALK-2 Inhibitor Program – BCX9250

Continue ongoing Phase 1 clinical trial of BCX9250, an oral ALK-2 kinase inhibitor for treatment of fibrodysplasia ossificans progressiva (FOP), in healthy subjects
Recent Corporate Developments

On November 6, 2019, the company provided a commercial update based on new 48-week clinical data from the APeX-2 and APeX-S trials, and detailed market research conducted with HAE patients, physicians who treat HAE and payors.

On November 5, 2019, the company announced it had licensed commercialization rights in Japan to Torii Pharmaceutical, Co. for BCX7353 for up to $42 million of upfront and potential milestone payments, including a $22 million upfront payment.
On November 1, 2019, the company announced it had begun enrollment of a Phase 1 trial of BCX9250, an oral ALK-2 inhibitor discovered and developed by BioCryst, for the treatment of FOP. The trial will evaluate the safety and tolerability and characterize the pharmacokinetic and pharmacodynamic profiles of BCX9250 in single and multiple ascending doses in healthy volunteers.
On November 1, 2019, the company announced results from a Phase 1 trial of BCX9930, an oral Factor D inhibitor discovered and developed by BioCryst, showing that BCX9930 was safe and generally well tolerated, and demonstrated rapid, sustained and >95% suppression of the alternative pathway of the complement system at 100 mg every 12 hours. Based on these results, the company is advancing the program into a proof of concept (PoC) study in PNH patients and plans to report data from the PoC study in the first half of 2020.
On September 26, 2019, the company announced the U.S. Department of Health and Human Services (HHS) had exercised its option to purchase an additional 10,000 doses of BioCryst’s approved antiviral influenza therapy, RAPIVAB (peramivir injection).
On September 23, 2019, the company announced it had appointed clinical rare disease expert, Helen Thackray, M.D., FAAP, to its board of directors.
Third Quarter 2019 Financial Results

For the three months ended September 30, 2019, total revenues were $1.8 million, compared to $1.5 million in the third quarter of 2018. The increase was primarily due to the recognition of $0.3 million of peramivir product sales to Shionogi & Co., Ltd., the company’s commercial partner in Japan.

Research and development (R&D) expenses for the third quarter of 2019 increased to $25.1 million from $22.0 million in the third quarter of 2018, primarily due to increased spending on our complement-mediated diseases programs, which entered Phase 1 clinical testing in June 2019.

Selling, general and administrative (SG&A) expenses for the third quarter of 2019 increased to $11.7 million, compared to $7.9 million in the third quarter of 2018. The increase was primarily due to increased spending on commercial activities and medical affairs to support the U.S. commercial launch of BCX7353 in 2020.

Interest expense was $3.0 million in the third quarter of 2019, compared to $2.3 million in the third quarter of 2018, and was primarily due to an increase in the outstanding balance of the company’s secured credit facility in February 2019.

Net loss for the third quarter of 2019 was $37.6 million, or $0.34 per share, compared to a net loss of $29.6 million, or $0.28 per share, for the third quarter of 2018.

Cash, cash equivalents and investments totaled $70.0 million at September 30, 2019, and reflect a decrease from $128.4 million at December 31, 2018. Operating cash use for the third quarter of 2019 was $24.5 million. Net operating cash use for the first nine months of 2019 was $77.9 million, as compared to $70.7 million for the first nine months of 2018.

Financial Outlook

BioCryst continues to expect full year 2019 net operating cash use to be in the range of $105 to $130 million, and its operating expenses to be in the range of $120 to $145 million. The company’s operating expense range excludes equity-based compensation expense due to the difficulty in reliably projecting this expense, as it is impacted by the volatility and price of the company’s stock, as well as by the vesting of the company’s outstanding performance-based stock options.

Conference Call and Webcast

BioCryst management will host a conference call and webcast at 8:00 a.m. ET today to discuss the financial results and provide a corporate update. The live call may be accessed by dialing 877-303-8027 for domestic callers and 760-536-5165 for international callers and using conference ID # 4891026. A live webcast of the call and any slides will be available online at the investors section of the company website at www.biocryst.com. A telephone replay of the call will be available by dialing 855-859-2056 for domestic callers or 404-537-3406 for international callers and entering the conference ID # 4891026.

On November 6, 2019 Oncolytics Biotech Inc. (NASDAQ:ONCY)(TSX:ONC), currently developing pelareorep, an intravenously delivered immuno-oncolytic virus, reported that positive results from its previously announced phase 1b REO 024 study of pelareorep in combination with pembrolizumab (Merck’s Keytruda) have been published in the peer-reviewed medical journal Clinical Cancer Research, a journal of the American Association for Cancer Research (AACR) (Free AACR Whitepaper) (Press release, Oncolytics Biotech, NOV 6, 2019, View Source [SID1234550407]). The study of 11 patients was conducted by Principal Investigator, Dr. Devalingam Mahalingam, Associate Professor of Medicine at Northwestern University Feinberg School of Medicine and a member of the Robert H. Lurie Comprehensive Cancer Center of Northwestern University.

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"Pelareorep and pembrolizumab added to chemotherapy was safe and well-tolerated and demonstrated encouraging efficacy results," said Dr. Mahalingam. "This study also highlighted the potential utility of several pre-treatment and on-treatment biomarkers for pelareorep therapy, which are currently being explored in our ongoing phase two study."

The phase 1b study was designed to assess the safety and tolerability of the treatment combination in patients with confirmed metastatic adenocarcinoma of the pancreas who failed or did not tolerate first-line treatment. In addition to a strong safety profile, positive findings from the study included objective responses indicating anti-tumor activity, long-term stabilization of disease and promotion of an inflamed phenotype in patients’ tumors. Importantly, these results supported advancing the combination regiment of pelareorep and Keytruda into phase 2 clinical development, which is currently ongoing.

"The publication of these encouraging clinical results in pancreatic cancer, which has extremely limited therapeutic options, serves as a validation for our approach to create inflammation within the tumour. As one of the final frontiers in oncology, we continue to evaluate pelareorep in patients with metastatic pancreatic cancer in our ongoing phase two study," said Dr. Matt Coffey, President and CEO of Oncolytics Biotech. "While we remain focused, we do plan to expand our pipeline of indications and expect the results from our ongoing studies to show anti-tumor activity and confirm the predictive biomarker that will lay the groundwork to grow beyond our breast cancer program. We remain on track to report interim results from our ongoing phase two study in pancreatic cancer in the first half of 2020 and complete patient enrollment around mid-2020."

About Pelareorep

Pelareorep is a non-pathogenic, proprietary isolate of the unmodified reovirus: a first-in-class intravenously delivered immuno-oncolytic virus for the treatment of solid tumors and hematological malignancies. The compound induces selective tumor lysis and promotes an inflamed tumor phenotype through innate and adaptive immune responses to treat a variety of cancers and has been demonstrated to be able to escape neutralizing antibodies found in patients.

On November 6, 2019 Achieve Life Sciences, Inc. (Nasdaq: ACHV), a clinical-stage pharmaceutical company committed to the global development and commercialization of cytisinicline for smoking cessation and nicotine addiction, reported an update on the cytisinicline clinical development program and announced third quarter 2019 financial results (Press release, OncoGenex Pharmaceuticals, NOV 6, 2019, View Source [SID1234550406]).

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Q3 2019 Highlights

Announced extension of a strategic collaboration with the National Center for Complementary and Integrative Health (NCCIH) at the National Institutes of Health (NIH). As part of the collaboration, the NIH is funding and providing research efforts to conduct additional non-clinical development as requested by the FDA to support cytisinicline’s New Drug Application (NDA).

Presented positive efficacy and compliance results from the Phase 2b ORCA-1 dose-selection trial evaluating cytisinicline in 254 smokers at the Society for Research on Nicotine & Tobacco Europe (SRNT-E) 19th Annual Conference. Cytisinicline demonstrated a statistically significant improvement in quit rates for a simplified 3.0 mg, three times daily dose and was well-tolerated with no serious adverse events reported.

Hosted Company’s first Investor Day, including roundtable discussion with smoking cessation medical experts and presentation of final ORCA-1 data, including plans for Phase 3 development program.

Presented at the H.C. Wainwright 21st Annual Global Investment Conference and the Ladenburg Thalmann 2019 Healthcare Conference.

"It has been a busy and eventful quarter with progressive data analysis further reinforcing the strength of the ORCA-1 Phase 2b trial and the potential for cytisinicline as a new treatment for the millions of people who are battling nicotine addiction," commented Rick Stewart, Chairman and Chief Executive Officer of Achieve. "Our key priority in the fourth quarter is to advance the ongoing, extensive preparations for the Phase 3 clinical trials, including our upcoming meeting with the FDA to finalize the cytisinicline Phase 3 protocols."

Extended Collaboration with NIH

In July, Achieve announced an extension of its strategic collaboration with the National Center for Complementary and Integrative Health (NCCIH) at the National Institutes of Health (NIH). Under the extended collaboration, the NIH is funding and providing research efforts to conduct additional non-clinical studies as requested by the U.S. Food and Drug Administration (FDA) to be included in a cytisinicline New Drug Application (NDA). In discussions with the FDA in 2018, it was determined that a Good Laboratory Practice (GLP) non-clinical reproductive study would be required to support the NDA submission. NCCIH has agreed to sponsor this study which is expected to complete in 2020. In total, the NIH has committed approximately $6 million dollars to the development of cytisinicline.

Presented Final ORCA-1 Data at SRNT-E Conference

Achieve’s Chief Scientific Officer, Dr. Anthony Clarke, facilitated two oral presentations featuring data from the Phase 2b ORCA-1 trial at the SRNT-E Annual Conference in Oslo. The ORCA-1 trial of cytisinicline in 254 U.S. smokers demonstrated a statistically significant improvement in quit rates for the 3.0 mg, three times daily dosing (TID) schedule. In the 3.0 mg TID arm, a 54% abstinence rate at week 4, compared to 16% for placebo (p < 0.0001) was observed. Continuous abstinence at weeks 5 through 8 was 30% for cytisinicline compared to 8% for placebo (p= 0.005). Adherence to study treatment was 98% in the 3.0 mg TID arm and cytisinicline was well-tolerated with no serious adverse events reported.

Investor Day and KOL Roundtable Discussion

The Company hosted its first investor day on September 20th, 2019, featuring an updated ORCA-1 data presentation and a roundtable discussion of smoking cessation medical experts, Dr. Mitchell Nides, Dr. Nancy Rigotti, Dr. Judith Prochaska, and Dr. Scott Leischow. The experts highlighted the critical need for the availability of new treatments, like cytisinicline, as an aid to smoking cessation. A replay of the event can be found at View Source

Financial Results

As of September 30, 2019, the company’s cash, cash equivalents, and restricted cash was $7.4 million. Total operating expenses for the three and nine months ended September 30, 2019 were $3.7 million and $13.3 million, respectively. Total net loss for the three and nine months ended September 30, 2019 was $3.7 million and $13.2 million, respectively.

As of November 6, 2019 Achieve had 8,352,764 shares outstanding.

Conference Call Details

Achieve will host a conference call at 8:00 a.m. Eastern time today, Wednesday, November 6, 2019. To access the webcast, log on to the investor relations page of the Achieve website at View Source Alternatively, access to the live conference call is available by dialing (877) 472-9809 (U.S. & Canada) or (629) 228-0791 (International) and referencing conference ID 7196429. A webcast replay will be available approximately two hours after the call and will be archived on the website for 90 days.

On November 6, 2019 Mersana Therapeutics, Inc. (NASDAQ:MRSN), a clinical-stage biopharmaceutical company focused on discovering and developing a pipeline of antibody drug conjugates (ADCs) targeting cancers in areas of high unmet medical need, reported financial results and a business update for the third quarter ended September 30, 2019 (Press release, Mersana Therapeutics, NOV 6, 2019, View Source [SID1234550405]).

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"We continue to execute on our 2019 goals and remain on track for near-term proof of concept and the potential for multiple data readouts in 2020. In the third quarter, we made important progress with the initiation of the XMT-1536 expansion study in patients with platinum resistant ovarian cancer and non-small cell lung cancer adenocarcinoma at a dose of 36 mg/m2 as well as the continuation of the dose escalation cohorts," said Anna Protopapas, President and CEO of Mersana Therapeutics. "We are pleased to report that the first three patients in the 43 mg/m2 dose escalation cohort have experienced no dose limiting toxicities. We are encouraged that the safety and efficacy profile of XMT-1536 continues to be promising."

Recent Highlights and Updates

Clinical Program

Expansion portion of the XMT-1536 Phase 1 study initiated. In August 2019, Mersana announced that it had dosed the first patient in the expansion study on the 36 mg/m2 once-every-four-week dose regimen. The Company continues to add sites and enroll platinum-resistant ovarian cancer patients who have failed standard therapy and non-small cell lung cancer (NSCLC) adenocarcinoma patients who have failed front line platinum-based chemotherapy with anti-PD-1 or anti-PD-L1 therapy or have exhausted targeted therapies.

Phase 1 dose escalation of XMT-1536 remains ongoing. In August 2019, Mersana announced that the 36 mg/m2 once-every-four-week dosing cohort cleared safety review and the Company initiated a 43 mg/m2 once-every-four-week dose escalation cohort. The Safety Review Committee has evaluated three patients on the 43 mg/m2 dose level and concluded that no patients experienced dose limiting toxicities and the dose has been well-tolerated to date. The Company plans to continue to enroll and evaluate additional patients at this dose level before deciding next steps for dose escalation and expansion.

Discovery Pipeline Progress

Mersana presented preclinical data from a research collaboration that investigated NaPi2b expression in NSCLC emphasizing correlations to histology. In a poster titled "NaPi2b expression in a large surgical non-small cell lung cancer cohort," investigators

concluded that in a large early-stage surgical NSCLC cohort, a high level of NaPi2b expression was seen with adenocarcinoma subtypes and tumors harboring EGFR and KRAS mutations.

Mersana remains on track to disclose its next ADC clinical candidate around year end, further strengthening its scientific leadership in ADC development. The Company is targeting the filing of its next Investigational New Drug (IND) application with the U.S. Food and Drug Administration (FDA) in the first half of 2020.

Mersana presented preclinical data from the Company’s novel Immunosynthen platform at the 10th Annual World ADC conference. Data supports the potential for the development of a STING agonist ADC that can address the challenge of systemic delivery and tolerability of immunomodulatory payloads.

Upcoming Events

The Company will present preclinical data from its novel Immunosynthen platform in a poster session at the 34th Annual Meeting of the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) from November 6 – 10, 2019, in National Harbor, MD. Details of the poster session are as follows:

Poster Title: "Tumor targeting of a STING agonist with an antibody drug conjugate elicits potent anti-tumor immune responses"

Date/Time: November 8, 2019 from 8 AM – 8 PM

Abstract/Poster #: P695

2019 Financial Results

Cash, cash equivalents and marketable securities as of September 30, 2019, were $112.0 million, compared to $70.1 million as of December 31, 2018. On March 5, 2019 the Company completed a public equity offering with gross proceeds of $97.8 million. On May 8, 2019, the Company completed a non-dilutive debt financing with Silicon Valley Bank (SVB) that provides Mersana with the ability to draw up to $20.0 million. The Company drew $5.0 million upon the execution of the agreement. The Company used net cash of $16.3 million in operations in the third quarter of 2019. The Company expects that its cash, cash equivalents and marketable securities will enable it to fund its operating plan into at least mid-2021.

Third Quarter 2019

Collaboration revenue for the third quarter 2019 was approximately $0.8 million, compared to $2.2 million for the same period in 2018. The decrease in collaboration revenue was primarily as a result of a decrease in services performed in support of partner’s programs.

Research and development expenses for the third quarter 2019 were approximately $13.7 million, compared to $15.2 million for the same period in 2018. The decrease was primarily due to decreased manufacturing costs for XMT-1536 and XMT-1522, offset by increased manufacturing costs for preclinical studies and discovery efforts associated with the Company’s next ADC clinical candidate, advancement of companion diagnostics development efforts for the NaPi2b biomarker and a milestone paid on the initiation of the expansion cohort.

General and administrative expenses for the third quarter 2019 remained flat at $4.4 million, compared to the same period in 2018.

Net loss for the third quarter 2019 was $16.8 million, or $0.35 per share, compared to a net loss of $17.1 million, or $0.74 per share, for the same period in 2018. Weighted average common shares outstanding for the quarters ended September 30, 2019 and September 30, 2018, were 47,833,607 and 23,152,019 respectively.

Conference Call

Mersana Therapeutics will host a conference call and webcast today at 8:00 a.m. ET to report financial results for the third quarter of 2019 and provide certain business updates. To access the call, please dial 877-303-9226 (domestic) or 409-981-0870 (international) and provide the Conference ID 459394. A live webcast of the presentation will be available on the Investors & Media section of the Mersana website at www.mersana.com.

About XMT-1536

XMT-1536 is a first-in-class ADC targeting the sodium-dependent phosphate transport protein (NaPi2b) and utilizing the Dolaflexin platform to deliver an average of 10-15 DolaLock payload molecules per antibody. The NaPi2b antigen is broadly expressed in non-small cell lung cancer (NSCLC) adenocarcinoma and ovarian cancer. XMT-1536 is in Phase 1 clinical trials in patients with tumors expressing NaPi2b, including ovarian cancer and NSCLC adenocarcinoma. More information on the ongoing Phase 1 clinical trial can be found at clinicaltrials.gov (NCT03319628).

On November 6, 2019 Perrigo Company plc (NYSE; TASE: PRGO), a leading global provider of "Quality, Affordable Self-Care ProductsTM", reported financial results for the third quarter ended September 28, 2019 (Press release, Perrigo Company, NOV 6, 2019, View Source [SID1234550404]).

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President and CEO Murray S. Kessler commented, "Our transformation to a consumer self-care company gained significant momentum during the third quarter as a number of our strategic initiatives began to take effect. Through both organic and inorganic growth, our global consumer net sales increased more than 3% and our adjusted net sales increased nearly 10% versus the prior year, excluding exited businesses and currency, helping Perrigo deliver its fourth consecutive quarter of meeting or exceeding adjusted EPS expectations."

Kessler continued, "While we are still in the early stages of our transformation, announced at our Investor Day in May, our organization is energized by the progress that has been made this year, and we are confident in our ability to recapture the Perrigo Advantage."

Key Financial Highlights

GAAP ("reported") consolidated net sales of $1.2 billion in the third quarter increased 5.1% versus the third quarter 2018.
Worldwide Consumer reported net sales were $961 million for the third quarter, up 3.3% versus the third quarter 2018. Excluding exited businesses and currency from the prior year comparison, Worldwide Consumer adjusted net sales increased 9.5%.
Third quarter 2019 reported diluted earnings per share ("EPS") was $0.67, as compared to a loss of $0.49 per diluted share in the third quarter 2018.
Adjusted diluted EPS was $1.04 per diluted share versus $1.09 a year ago. Refer to Table I at the end of this press release for a complete description of non-GAAP adjustments to diluted EPS, which includes $0.11 per share for the voluntary global recall of ranitidine.
The Company expects 2019 reported diluted EPS to be in the range of $2.01 – $2.21 per share. The Company is raising its 2019 adjusted diluted EPS range to $3.85 – $4.05 from $3.75 – $4.05.
Third Quarter Reporting Segments Updated to Include Ranir

The Company has finalized operational reporting lines where the U.S. operations of Ranir will be included in the Consumer Self-Care Americas ("CSCA") segment and Ranir’s non-U.S. operations will be included in the Consumer Self-Care International ("CSCI") segment. These businesses will comprise the newly formed ‘oral self-care category’ in each segment. This update is reflected in this quarter’s financial statements and had no impact on the Company’s historical consolidated results of operations.

Refer to Tables I – V at the end of this press release for a reconciliation of non-GAAP adjustments to the current year and prior year periods and additional non-GAAP information. The Company’s reported results are included in the attached Condensed Consolidated Statements of Operations, Balance Sheets and Statements of Cash Flows.

Consolidated Third Quarter 2019 Results Versus Third Quarter 2018

Reported consolidated net sales increased 5.1% to $1.2 billion. Adjusted net sales increased 10.2% compared to last year, when exited businesses are excluded from the prior year comparison and currency rates are kept constant. This increase was driven by the addition of Ranir, new product sales of $52 million and increased demand for existing products. Discontinued products were $9 million.

Reported net income was $92 million, or $0.67 per diluted share, versus a loss of $68 million, or a loss of $0.49 per diluted share, in the prior period. Excluding certain charges as outlined in Table I, third quarter 2019 adjusted net income was $142 million, or $1.04 per diluted share versus $150 million, or $1.09 per diluted share, for the same period last year. The adjusted diluted EPS was lower due primarily to a one- time tax-depreciation benefit in the prior year of $0.05 per diluted share.

Worldwide Consumer Self-Care Third Quarter 2019 Results Versus Third Quarter 2018

Worldwide Consumer reported net sales for the third quarter of 2019 were $961 million, an increase of 3.3%. Adjusted net sales of $968 million were 9.5% higher, excluding exited businesses and unfavorable currency movements from the prior year comparison.

Third quarter reported gross profit margin was 35.5%. Adjusted gross profit margin of 40.4% was 40 basis points lower as favorable product mix was more than offset by the addition of Ranir oral self-care products, which have a lower gross margin profile than the existing portfolio.

Reported operating margin was 3.6%. Adjusted operating margin was 15.8%, or 40 basis points lower due primarily to gross margin flow-through.

CSCA Third Quarter 2019 Results Versus Third Quarter 2018

Consumer Self-Care Americas reported net sales of $613 million increased 2.9%. Excluding $28 million from exited businesses and currency changes from the prior year comparison, CSCA adjusted net sales increased 9.1% to $619 million, which included the addition of $54 million of net sales from the acquisition of Ranir.

Sales growth was driven primarily by 1) the acquisition of Ranir, 2) increased consumer demand for store brand allergy products, 3) higher sales in the smoking cessation category, and 4) new product sales of $6 million in the quarter.

This sales growth was partially offset by 1) purposefully exited businesses, 2) lower infant formula contract pack sales, and 3) lower net sales in the segments Mexican business.

Third quarter reported gross profit margin was 30.2%. Adjusted gross profit margin of 34.0% was 40 basis points higher due primarily to favorable OTC product mix.

Reported operating margin was 13.3%. Adjusted operating margin was flat at 19.8%, as gross margin flow-through and lower administration expenses were offset by operational inefficiencies and increased investments to drive innovation.

CSCI Third Quarter 2019 Results Versus Third Quarter 2018

Consumer Self-Care International reported net sales increased 4.0% to $348 million. Excluding unfavorable currency movements of $19 million, from the prior year comparison, adjusted net sales were higher by 10.1%. Excluding currency and Ranir, CSCI organic adjusted net sales grew 3.3%.

This sales growth was due primarily to 1) strong new product sales of $28 million driven by the launch of XLS Forte 5, a next generation weight loss product, and new products in the Phytosun naturals portfolio, 2) $23 million of net sales from Ranir, and 3) higher net sales in the cough/cold/allergy/sinus category.

Reported gross margin was 45.0%. Adjusted gross margin of 51.9% declined 190 basis points due primarily to the addition of Ranir oral self-care products, which have a relatively lower gross margin than the overall portfolio.

Reported operating margin was 3.8% while the adjusted operating margin was 18.2%.

Prescription Pharmaceuticals ("RX") Third Quarter 2019 Results Versus Third Quarter 2018

RX reported net sales increased 13.6% to $230 million due primarily to higher volumes of existing products and new product sales of $18 million. Discontinued products were $6 million.

Reported gross margin was 31.0% and adjusted gross margin was 40.9%. The 720 basis point decline in adjusted gross margin was due primarily to pricing pressure, higher cost of goods and adverse product mix.

Reported operating margin was 8.5% and adjusted operating margin was 24.0%.

Outlook

The Company expects 2019 reported diluted EPS to be in the range of $2.01 – $2.21 per share. With strong performance in the Worldwide Consumer businesses, the Company raised its 2019 adjusted diluted EPS guidance to $3.85 – $4.05 from $3.75 – $4.05.