On August 19, 2019 WuXi AppTec Co., Ltd. (stock code: 603259.SH / 2359.HK), a platform that provides a broad portfolio of R&D and manufacturing services that enable companies in the pharmaceutical, biotech and medical device industries worldwide to advance discoveries and deliver groundbreaking treatments to patients, reported its financial results for the six months ended June 30, 2019 ("Reporting Period") (Press release, WuXi AppTec, AUG 19, 2019, View Source [SID1234538870]).

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This document serves purely as a summary and is not intended to provide a complete representation of the relevant matters. For further information, please refer to the 2019 interim report and relevant announcements published on the websites of the Shanghai Stock Exchange (www.sse.com.cn) and the Stock Exchange of Hong Kong (www.hkexnews.hk), and the designated media for dissemination of the relevant information. Investors are advised to exercise caution and be aware of the investment risks in dealing in the shares of the Company.

All financials disclosed in this press release are prepared based on International Financial Reporting Standards (or "IFRSs").

First Half 2019 Financial Highlights

Accelerated revenue growth of 33.7% year-over-year to RMB 5,894 million which was broad-based across all our business segments. During the Reporting Period, we added nearly 600 new customers and our active customers during this period exceeded 3,600. By fully leveraging the strength of our integrated end-to-end R&D services platform, we were able to create further synergies across all our business segments as we continued to adhere to our "Follow the Project" and "Follow the Molecule" strategies.
Gross profit grew 30.0% year-over-year to RMB 2,284 million. Gross profit margin was 38.7%[3]
Adjusted non-IFRS net profit attributable to owners of the Company grew 32.0% year-over-year to RMB 1,179 million.
Net profit attributable to owners of the Company was lower 16.9% year-over-year to RMB 1,057 million, due to a RMB 55 million loss from changes in fair value of our investment portfolio, versus a RMB 432 million gain in the same period last year.
Adjusted non-IFRS EPS increased by 9.1% versus the same period last year while diluted EPS was down 31.2%.[4]
First Half 2019 Operational Highlights

We acquired nearly 600 new customers, and our active customer count reached more than 3,600. We attracted and enabled numerous innovative biotech companies on our platform. We focused on and increased customer conversion, creating further synergies across all our business segments.
In small molecule drug discovery services, we continued to assist global customers develop pre-clinical candidate molecules and patent applications, with multiple research papers published in leading scientific journals. Our DNA-Encoded library ("DEL") now contains 90 billion compounds, enabling a growing number of customers globally to discover innovative small molecule drugs.
In our success-based drug discovery unit, we filed INDs for 10 new-chemical-entities for domestic customers with the China National Medical Products Administration (the "NMPA") and obtained 11 clinical trial authorizations ("CTAs"). As of June 30, 2019, we have cumulatively submitted 65 new-chemical-entity IND filings with the NMPA for our customers and obtained 45 CTAs.
In our laboratory testing services, we fully leveraged our platform, combining our technical experience, program management and regulatory expertise to prepare and facilitate submissions of our customers’ IND packages (the WuXi IND program or "WIND"). For the first time, we also helped our customers obtain clinical trial approval from the FDA under eCTD format.
Our small molecule CDMO/CMO pipeline has grown to more than 800 active projects, including 11 under China’s MAH pilot program. Furthermore, 40 projects are in Phase III clinical trials and 16 are already in commercial manufacturing.
Our cell and gene therapies CDMO business provided services for 30 clinical stage projects, including 21 projects in Phase I and 9 projects in Phase II/III.
We continued to build our global clinical research capabilities. Since our acquisition of Research Point Global, we are now providing multi-regional clinical development services to multiple customers. In May 2019, we also acquired Pharmapace, Inc., a clinical research services company with significant expertise in providing high quality biometrics services, allowing us to further diversify our global clinical trial service offering.
In April 2019, we appointed Dr. Frederick H. Hausheer as our Chief Medical Officer. With his decades of extensive clinical experience in both the US and China, Dr. Hausheer is already having a big impact on the design of our customers’ medical and clinical development programs. His skills enable us to provide a seamless integration of drug development projects from preclinical translational R&D into first-in-human studies along with Phase I-IV clinical development plans for our customers.
We hired Dr. Zhigang Chen as our Chief Digital Officer. As digital technology within the healthcare field becomes an increasingly important asset, Dr. Chen will put the infrastructure in place for WuXi AppTec to capitalize on the copious information synergies within our platform.
During the Reporting Period, we also continued to enhance our capacities and capabilities across all segments and facilities. Our newly built Qidong research and development center began operation. Three of our Laboratory Testing Division’s facilities – Drug Safety Testing, Bioanalytical Services and Medical Device Testing – completed regulatory inspections by the FDA, OECD, and CNAS, all with excellent results. Our cell and gene therapies CDMO/CMO facility in Wuxi city began operation, providing services to customers in China. Our small molecule CDMO/CMO STA’s new drug product manufacturing facility in Shanghai passed its first GMP inspection by the European MPA and, in July 2019, STA’s ASU facility in Shanghai and API process R&D and manufacturing facility in Changzhou, successfully passed two inspections by the FDA, with no Form 483 issued.
Management Comment

Mr. Edward Hu, Co-CEO of WuXi AppTec, said, "We achieved accelerated growth in the first half of 2019 across all of our businesses. Our revenue grew 33.7% to RMB 5,894 million and our adjusted non-IFRS net profit attributable to owners of the Company grew 32.0% to RMB 1,179 million. Both revenue and adjusted net profit growth rate accelerated compared with growth rate from the same period last year. In addition, we increased our focus on customer conversion, enabling further synergies across all our business segments."

Mr. Edward Hu further commented, "Our China-based laboratory services segment expanded its global and domestic customer base, improved customer penetration, and maintained a steady revenue growth rate of 23.7% to RMB 2,989 million. Our small molecule CDMO/CMO services portfolio increased from 650+ molecules at the end of 2018 to over 800 molecules as of June 30, 2019, and revenue grew 42.0%. US-based laboratory services revenue growth increased 30.0%, compared to a drop of 1.9%, in the same period last year. This was primarily due to cell and gene therapies CDMO services progressing more projects to later stage. Likewise, our medical device testing business returned to more historical levels of growth. Clinical research services was our fastest growing segment. Revenue grew 104.2%, driven by strong development of the domestic new drug clinical trial market, and contribution from acquired clinical CRO business."

Dr. Ge Li, Chairman and CEO of WuXi AppTec, concluded, "While achieving strong revenue growth, we continued to invest in new capacity and capabilities, including talent, laboratories, manufacturing facilities and technologies. Our integrated platform enables more entrepreneurs, scientists, and doctors around the world to participate in innovation to bring the best and newest medicines to those patients in need."

2019 Interim Results

Revenue increased 33.7% year-over-year to RMB 5,894 million.
– China-based laboratory services realized revenue of RMB 2,989 million, representing a year-over-year growth of 23.7%. We have one of the largest and most experienced small molecule drug R&D organizations globally, along with a comprehensive testing platform.
– CDMO/CMO services realized revenue of RMB 1,718 million, representing a year-over-year growth of 42.0%. The Follow-the-Molecule" strategy continues to perform very well. We establish close, cooperative relationships with our customers during the pre-clinical and early clinical development stage, and are then able to advance these projects into later clinical and commercialization stages if the molecules succeed in clinical development.
– U.S.-based laboratory services realized revenue of RMB 710 million, representing year-over-year growth of 30.0%. For cell and gene therapies CDMO services, we acquired more customers and more projects progressed to late stage, allowing revenue growth to accelerate. For medical device testing services, we actively developed new customers and capitalized on incremental demand resulting from the European Union Medical Device Regulation change.
– Clinical research and other CRO services realized revenue of RMB 472 million, representing year-over-year growth of 104.2%. Growth was mainly driven by continued rapid development of the domestic new drug clinical trial market, and acquired US clinical CRO business contributed RMB 84 million for the six months ended June 30, 2019. Excluding the effect of acquisition, the revenue of our clinical research and other CRO services grew 67.7%.
Gross profit increased 30.0% year-over-year to RMB 2,284 million. Gross profit margin was 38.7%, slightly lower than 39.8% in the six months ended June 30, 2018.[5]
– China-based laboratory services realized gross profit of RMB 1,301 million, representing year-over-year growth of 20.0%. Gross profit margin was 43.5%, lower by 1.34 percentage points[6], due to an increase in share-based compensation expenses and project mix.
– CDMO/CMO services realized gross profit of RMB 698 million, representing a year-over-year growth of 42.7%, in line with revenue growth. Gross profit margin was 40.6%[7], the same as last year. |
– U.S.-based laboratory services realized gross profit of RMB 191 million, representing year-over-year growth of 52.3%. Gross profit margin was 26.9%, up 3.93 percentage points[8], because of new customer acquisition and higher utilization rate of cell therapy manufacturing facilities.
– Clinical research and other CRO services realized gross profit of RMB 92 million, representing year-over-year growth of 65.5%. Gross profit margin was 19.4%, down 4.54 percentage points,[9] mainly due to the effect of pass-through revenue and amortization cost of intangible assets associated with M&A.
Net profit attributable to owners of the Company decreased 16.9% year-over-year to RMB 1,057 million, mainly due to a RMB 55 million loss in fair value of our investment portfolio, compared with a RMB 432 million gain in the same period last year. Excluding the impact of changes in fair value of our investment portfolio, the net profit attributable to owners of the Company in the current period increased by 32.4% compared with the same period last year.
2019 Interim Non-IFRS Results

2019 interim non-IFRS net profit attributable to owners of the Company decreased 10.7% year-over-year to RMB 1,213 million. This adjusts for share-based compensation expenses, listing expenses, foreign exchange-related effects and amortization of intangible assets acquired in business combinations.
2019 Interim Adjusted Non-IFRS Results

Excluding realized/unrealized gains or losses from our venture investments and realized/unrealized gains or losses from our joint ventures, 2019 interim adjusted non-IFRS net profit attributable to owners of the Company increased 32.0% year-over-year to RMB 1,179 million.

On August 19, 2019 Immunicom, Inc., a medical technology company reported that it has been awarded FDA Breakthrough Device Designation for its non-pharmaceutical solution for treating stage IV metastatic cancer, hosted its 1st Annual Global Immunopheresis Clinical Conference which began on July 31st (Press release, Immunicom, AUG 19, 2019, View Source [SID1234538869]). This event provided a forum for oncology clinical leaders to meet, discuss and learn about Immunicom’s novel, cutting-edge immunotherapy − Immunopheresis.

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The conference was a collaborative event involving Immunicom’s global partners and focused on therapeutic apheresis as a viable clinical approach in oncology that potentially represents a less-costly innovation than currently-available therapies with the promise to enhance patient care and quality of life.

"Immunicom was extremely pleased to host such accomplished clinicians and thought leaders to our 1st Annual Global Immunopheresis Clinical Conference. Clearly, their collective interest in and enthusiasm for this potentially transformational therapy fueled the robust discussions that took place throughout the conference," said Amir Jafri, founder and CEO of Immunicom.

Immunicom plans to expand this conference series and other discussion opportunities in the future to include more participants and foster the exploration of new treatment boundaries in oncology. For more information about the event, please refer to the conference website.

On August 19, 2019 ViewRay, Inc. (Nasdaq: VRAY) reported the acceptance of publication by the International Journal of Radiation Oncology, Biology and Physics of the first prospective clinical trial of MR-guided radiation therapy (MRgRT) in patients with localized prostate cancer (Press release, ViewRay, AUG 19, 2019, View Source [SID1234538868]). This robust study of clinician and patient reported outcomes demonstrated zero CTCAE v4 grade 3 or higher gastrointestinal (GI) and genitourinary (GU) toxicity and even lower incidence of grade 2 toxicity than investigators hypothesized. It is also one of the first prospective clinical trials to study SBRT in a mix of intermediate- and high-risk prostate cancer patients, a challenging patient population to treat. The journal is the official scientific journal of the American Society for Radiation Oncology.

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Researchers from Amsterdam University Medical Center enrolled 101 patients with intermediate- or high-risk prostate cancer in a prospective phase II clinical trial. All patients received MRgRT in five fractions of 7.25 Gy to the target volume using on-table adaptive techniques. The trial did not use implanted markers or tissue spacers because treatments were delivered under MR-guidance, thereby eliminating an invasive procedure, potentially associated complications, and implantation costs.

Results at three months showed that no early CTCAE v4.0 grade 3 GU or GI toxicity was observed, and the maximum cumulative grade 2 early GU and GI toxicity measured by any symptom at any study time point was 23.8% (study hypothesis 40%) and 5.0% (study hypothesis 15%). These results were obtained in a complex clinical cohort (59.4% high-risk patients) and are comparable to what would be typically observed in lower-risk populations, pointing to the potential benefits of MR-guided SBRT in this higher risk group. Additionally, the low incidence of early GI toxicity, despite the inclusion of the base of the seminal vesicles in 96 percent of patients, illustrates the benefit of MR-guidance and on-table adaptive re-planning. This technology facilitates smaller treatment margins while minimizing damage to surrounding tissue and critical structures, such as urethra, rectum, and bladder. The publication noted that incontinence was uncommon, reported by 4% of patients at the end of MRgRT and decreasing over time.

"SBRT offers significant promise in the treatment of prostate cancer. Our clinical trial takes that a step further in showcasing its value in patients with intermediate- and high-risk disease, with a focus on evaluating associated toxicities and quality of life outcomes," said principal investigator Anna Bruynzeel, M.D., Ph.D., Radiation Oncologist at Amsterdam UMC. "We see a lower incidence of GI and GU toxicity with MR-guidance as compared to similar SBRT prostate cancer studies. The results reinforce the value of MRIdian’s real-time on-table adaptive treatment with automatic beam gating for prostate patients."

"This promising data in the treatment of prostate cancer with SBRT, enabled by the unique combination of MRIdian’s ability to see, shape, and strike, is notable for patients and physicians," said Scott Drake, President and CEO. "MRIdian is providing physicians the confidence and tools they need to deliver ablative radiation doses both precisely and accurately while sparing sensitive structures near the target, in order to achieve better patient outcomes. We are pleased to add this prospective trial to our clinical data compendium and thank the team at Amsterdam UMC for their work to improve the lives of cancer patients."

The article in press can be viewed at View Source(19)33640-5/fulltext.

About the Study
Article in Press in the International Journal of Radiation Oncology, titled: "A prospective single-arm phase II study of stereotactic magnetic-resonance-guided adaptive radiotherapy for prostate cancer: Early toxicity results", authored by Anna M.E. Bruynzeel, MD, PhD, Shyama U. Tetar, MD, Swie S. Oei, MD, Suresh Senan, MRCP, FRCR, PhD, Cornelis J.A. Haasbeek, MD, PhD, Femke O.B. Spoelstra, MD, PhD, Anna H.M. Piet, MD, Philip Meijnen, MD, PhD, Marjolein A.B. Bakker van der Jagt, MD, Tamara Fraikin, Berend J. Slotman, MD, PhD, Reindert J.A. van Moorselaar, MD PhD, and Frank J. Lagerwaard, MD, PhD. According to the study, "The maximum cumulative grade ≥2 early GU and GI toxicity measured by any symptom at any study time point was 23.8% and 5.0%, respectively. No early grade 3 GI toxicity was observed. Early grade 3 GU toxicity was 0% and 5.9% according to the CTCAE and RTOG and scoring systems, respectively, as a result of different grading of radiation-cystitis. The low incidence of early GI toxicity was confirmed by patient-reported outcome data. GU grade ≥2 toxicity peaked to 19.8% at the end of MRgRT, followed by a return to the baseline average score at three months follow-up."

On August 19, 2019 WuXi Biologics (Cayman) Inc. ("WuXi Biologics" or "the Group," stock code: 2269.HK), a leading global open-access biologics technology platform company offering end-to-end solutions for biologics discovery, development and manufacturing, reported its unaudited interim results for the six months ended June 30, 2019 (Press release, WuXi Biologics, AUG 19, 2019, View Source [SID1234538867]).

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First-Half 2019 Financial Highlights

Strong revenue growth of 52.4% y-o-y to RMB1,607.1 million.
Gross profit increased by 61.8% y-o-y to RMB671.0 million, with gross profit margin up 250 basis points to 41.8% mainly due to (i) strong business growth with the increase of number of integrated projects; (ii) the improved operational efficiency of the Group, in particular, the fast ramp-up of MFG3; and (iii) more milestone payments received.
Net profit and adjusted net profit grew 80.1% and 75.8% y-o-y to RMB449.5 million and RMB521.5 million, respectively.
Net profit margin and adjusted net profit margin were 28.0% and 32.4%, respectively, both up 430 basis points y-o-y, due to strong growth in revenue, solid cost control and business operation efficiency enhancement, and more milestone payments.
Diluted EPS increased by 78.9% from RMB0.19 to RMB0.34.
Adjusted diluted EPS increased by 69.6% from RMB0.23 to RMB0.39.
First-Half 2019 Operational Highlights

The number of ongoing integrated projects increased from 187 as of June 30, 2018, to 224 as of June 30, 2019, with late-phase projects increasing from 10 to 15.
Total backlog grew significantly from US$3,639 million as of December 31, 2018 to US$4,630 million as of June 30, 2019. Our potential upcoming milestone backlog surged from US$2,006 million as of December 31, 2018 to US$2,894 million as of June 30, 2019, mainly driven by signing more WuXiBodyTM projects.
WuXi Vaccines signed letter of intent (LOI) for a 20-year vaccine manufacturing contract valued over US$3 billion with a global vaccine leader, demonstrating our technical strength, global premier quality, and transferable skills from biologics to vaccines.
WuXiBodyTM continued to be widely adopted by global and domestic customers, signed 8 licensing agreements with 5 partners in 1H 2019, which will potentially contribute more milestone and royalty revenues.
The Group successfully completed the first FDA routine GMP inspection, which demonstrates continuous commitment and strong expertise in meeting global compliance requirements.
Our manufacturing facility expansion is on track. MFG4, the first facility in China to use 4,000L disposable bioreactor and DP4, the first robotic sterile filling facility for biologics in China are both GMP released in July.
The Group continued to attract and retain talents and build one of the largest biologics development teams globally, while our retention rate is higher than 95%, significantly higher than the industry average.
WuXi Biologics continues the strong growth trend. The number of integrated projects and backlog kept expanding meanwhile our vaccine business made great progress only one year after its launch. All our global manufacturing capacity expansion is on track, laying a solid foundation to meet strong demands in the future. In addition, we estimate that our total employee number will reach around 5,600 by the end of 2019. The Group’s innovative proprietary technology platforms led the industry innovation trend, better enabled our partners and further enhanced the Group’s mission of accelerating and transforming biologics discovery, development and manufacturing.

Robust Revenue Growth Continued, Gross Margin and Net Profit Margin Expanded

In 1H 2019, WuXi Biologics continued to deliver robust revenue growth of 52.4% y-o-y to RMB1,607.1 million, further demonstrating the successful implementation of our "Follow-the-Molecule" strategy. Our net profit and adjusted net profit grew 80.1% and 75.8% y-o-y to RMB449.5 million and RMB521.5 million, respectively. Meanwhile the gross margin, net profit margin, and adjusted net profit margin all expanded substantially and achieved record-highs. Our innovative technology platforms have been endorsed by the industry, and started to contribute more milestone revenue, which have improved the margins in this period.

The Group continued to gain more market share and win trust from customers. The number of ongoing integrated projects increased to 224 as of June 30, 2019, with late-phase projects increasing to 15. The backlog surged to US$4,630 million as of June 30, 2019 with potential upcoming milestone backlog surging to US$2,894 million as of June 30, 2019, demonstrating our technology platforms are adopted by more customers and will contribute more future revenue.

Reinforce Technology Innovation, WuXiBodyTM Widely Adopted by Customers

As the Group continues to reinforce its efforts in technology innovation, the R&D expenses have reached 6.8% of the total revenue in 1H 2019. WuXi Biologics is leveraging innovative technologies to optimize the entire spectrum of services offered to global biologics industry. The Group expects the strong momentum to continue, driven by the growing expenditures in R&D for biologics worldwide, as it expands its customer base and increases revenue from each integrated project as well as milestone and royalty fees.

Since the launch of WuXiBodyTM, this platform has been quickly adopted by global and domestic partners with 5 new partners and 8 projects in 1H 2019. The Group has showed its capability in expediting bispecific development and cost reduction by successfully entering into multiple strategic collaborations. The WuXiBodyTM platform will be another growth driver which contributes more milestone payments and future royalties as well as adds more integrated projects into our pipeline of "Follow-the-Molecule" strategy.

WuXi Vaccines Made Great Progress, A New Growth Engine to Drive Sustained High Growth

WuXi Vaccines, a joint venture of WuXi Biologics and Shanghai Hile Bio-Pharmaceutical, has entered into a strategic partnership via a letter of intent (LOI) with a global vaccine leader. It is estimated that the value of this 20-year manufacturing contract will be over US$3 billion. The contract is targeted to be finalized by this year with substantial revenue contribution in 2022.

This marked a huge milestone for the Group’s vaccine business which started only within one year. This partnership with a global vaccine leader, as the first of its kind in the industry, is a further testimony to the technical strengths and premier quality demonstrated by WuXi Biologics. The vaccine CDMO market, seeing huge opportunities globally and domestically as China’s regulatory reforms tightened amid increasing public awareness, is expected to be another driver of the Group’s business growth going forward.

Global Manufacturing Capacity Expansion on Track, A Demonstration of "WuXi Bio Speed"

The Group is seizing the opportunity of the booming global biologics market and has announced global manufacturing facility expansion plan since last year. The total capacity will exceed 280,000L by 2022, which will provide a robust and premier global supply chain to support the strong demands from the industry. To capture the next wave of biologics, the Group has also announced to expand construction of a new integrated biologics conjugation solution center for ADCs, which will further enhance the technical capabilities and manufacturing capacities in the fast-growing bioconjugation field.

All the Group’s construction projects are on track, demonstrating the "WuXi Bio Speed". The Ireland site will be GMP ready in 2021 and support the demands from European and US markets. Furthermore, MFG4 and DP4 are both GMP released in July. It took only 13 months for MFG4 and 12 months for DP4 from completing design to GMP-release of the facility, further demonstrating "WuXi Bio Speed".

Completed First FDA Routine GMP Inspection, Another Demonstration of "WuXi Bio Quality"

In 1H 2019, the Group has also successfully completed a seven-day FDA surveillance inspection for the production of Trogarzo, the first routine GMP inspection since product approval. The completion of the inspection further endorses WuXi Biologics’ proven quality system and solid reputation as a leading global biomanufacturing player, demonstrating that "WuXi Bio Quality" has reached the highest international quality standard.

Dr. Chris Chen, CEO of WuXi Biologics, said, "We are excited about the extraordinary performance achieved in 1H 2019. WuXi Biologics continued to gain more market share from the booming biologics outsourcing market due to our advanced technology platforms, premier quality system and excellent track record. We are delighted to see that the number of integrated projects and total backlog have both increased substantially, showcasing the success of ‘Follow-the-Molecule’ strategy and providing clear visibility for our future growth. We also keep exploring new business opportunities as the vaccine business has made great progress and WuXiBodyTM platform has been widely adopted by the industry. Through these new growth engines, the Group will engage more in the global biologics innovation and enable more strategic partners."

Dr. Chris Chen, further commented, "As a global leading enabling platform, WuXi Biologics continues to shorten the timeline from DNA to IND, expedites product development at record speed. We have sufficient capacity to start any project within 4 weeks. Besides, our expanding global footprints are all on track and the ‘Global Dual Sourcing within WuXi Bio’ strategy will ensure our partners’ commercial product supply as well as securing more commercial manufacturing contracts for the Group. We already have 58 first-in-class projects in pipeline, demonstrating our strong capabilities to enable global innovative partners. With the cutting-edge platforms, we strive to enable partners worldwide and we have seen exceptional growth from three major regions, especially the U.S., our largest market, which maintained high growth despite geopolitical uncertainties. Our EU market has sustained over 185% CAGR growth over the past five years. Throughout 1H 2019, we drove a superior business execution. Looking ahead, we are confident that the strong growth momentum will continue and solidify our leading position."

Dr. Ge Li, Chairman of WuXi Biologics, concluded: "The booming biologics industry is full of opportunities and we are well prepared for it. We will continue to accelerate and transform biologics industry and provide a robust global supply chain with premium quality. The ecosystem we are building will enable our customers and partners to discover, develop and manufacture more drugs to benefit patients worldwide."

2019 Interim Results

The Group’s revenue increased by 52.4% y-o-y to RMB1,607.1 million in 1H 2019. The major revenue growth drivers were: (i) enhancement of core competitiveness contributing to more market share and steady growth in the number of integrated projects; (ii) the Group’s innovative proprietary technology platforms have been more adopted in the industry and; (iii) the success of "Follow-the-Molecule" strategy.

Gross Profit increased by 61.8% to RMB671.0 million in 1H 2019. The Group’s gross profit margin increased from 39.3% in the first half of 2018 to 41.8% of same period this year. The improvement was driven by the following factors: (i) the Group’s strong business growth, along with the rapid increase in its number of integrated projects; (ii) the improved operational efficiency, in particular, the fast ramp-up of MFG3; (iii) more milestone payments received.

During the Reporting Period, Net Profit surged by 80.1% y-o-y to RMB449.5 million in 1H 2019, higher than 78% announced in Positive Profit Alert announcement, with net profit margin up 430 basis points to 28.0% in 1H 2019. The significant increase in net profit margin was primarily attributable to (i) steady increase in the number of integrated projects and as a result, strong growth in revenue; (ii) solid cost control and business operation efficiency enhancement.

Adjusted Net Profit, by excluding the impact of: (i) foreign exchange gains or losses; (ii) share-based compensation, our adjusted net profit increased by 75.8% y-o-y to RMB521.5 million in 1H 2019, and adjusted net profit margin went up 430 basis points from 28.1% in the first half of 2018 to 32.4% of same period this year.

Basic and Diluted EPS were RMB 0.37 and RMB 0.34, respectively. Diluted EPS increased by 78.9% y-o-y.

Adjusted Diluted EPS increased by 69.6% y-o-y to RMB 0.39.

On August 19, 2019 HedgePath Pharmaceuticals, Inc. (OTCQB:HPPI), a biopharmaceutical company focused on the discovery, development and commercialization of innovative therapeutics to inhibit the progression of cancerous and non-cancerous proliferation disorders, reported plans to change its name to INHIBITOR Therapeutics as well as a change to the ticker symbol for common and preferred stock to "INTI" from "HPPI (Press release, HedgePath Pharmaceuticals, AUG 19, 2019, View Source [SID1234538866])." Both the corporate name change and ticker symbol change are expected to be effective with the opening of trading on August 20, 2019.

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In conjunction with the corporate name change, INHIBITOR will launch a new website (www.inhibitortx.com) to showcase INHIBITOR’s vision and development strategy for SUBA-Itraconazole, a proprietary formulation of the FDA approved anti-fungal drug itraconazole designed to enable improved bioavailability compared to conventional itraconazole when used as an anti-cancer treatment, as well as novel compounds that inhibit upstream targets of the Hedgehog Pathway as treatments for cancer and non-cancerous proliferation disorders.

"Changing our name to INHIBITOR Therapeutics marks an important point of inflection for our company as we are now positioned to capitalize on several business and clinical development initiatives, offering potential catalysts for multiple value-building events during 2019 and 2020," stated Nicholas J. Virca, President and Chief Executive Officer of INHIBITOR. "In the near-term, following a pre-IND (Investigational New Drug) meeting with the Food and Drug Administration (FDA) in April this year, INHIBITOR has secured an End of Phase 2 Meeting (EOP2) with FDA scheduled for the fourth quarter of 2019 to finalize our clinical protocol and statistical analysis plan as we prepare to submit our IND application to study SUBA-Itraconazole in patients with late-stage prostate cancer. Upon IND clearance, we plan to initiate a multi-center, randomized, double-blind, placebo-controlled Phase 2b clinical trial in men with metastatic castrate-resistant prostate cancer (mCRPC) in 2020. Additionally, in 2020, we plan to hold discussions with the FDA to advance our Phase 2b clinical program to study SUBA-Itraconazole in patients with late-stage lung cancer."

Virca continued, "We are also excited to report the signing of a renewal, for an additional year, of an expanded, exclusive worldwide option agreement with the University of Connecticut to initiate pre-clinical testing in basal cell carcinoma using novel compounds (itraconazole analogues) designed to inhibit specific protein targets of the Hedgehog Pathway. We believe this technology has significant potential and could become a platform for targeting multiple cancerous and non-cancerous proliferation disorders."

About SUBA-Itraconazole

SUBA-Itraconazole is a patented formulation of itraconazole designed to enable improved absorption and significantly reduced variability compared to generic itraconazole. Research suggests that these properties offer the potential to provide reduced intra- and inter-patient variability, enable a more predictable clinical dose response, and reduce the active drug quantity required to deliver therapeutic levels into the bloodstream.

SUBA-Itraconazole is manufactured by Mayne Pharma under current Good Manufacturing Practice standards for INHIBITOR’s use in clinical trials. An affiliate of Mayne Pharma is INHIBITOR’s majority stockholder and the licensor of the SUBA-Itraconazole technology.

About University of Connecticut Itraconazole Analogues

The itraconazole analogues, which are being developed by Dr. M. Kyle Hadden, Associate Professor of Medicinal Chemistry, Department of Pharmaceutical Sciences at the University of Connecticut, have modifications to particular regions of the itraconazole scaffold. The patents and patent applications include compositions of matter claims covering the itraconazole analogues and method claims covering their use for the treatment of cancer. Data from Dr. Hadden’s laboratory suggest that certain of these analogues maintain potent Hedgehog Pathway inhibition while exhibiting improved pharmacokinetic parameters and reduced off-target side effects sometimes associated with itraconazole. Initial testing efforts are focused on BCC tumor inhibition.