On October 30, 2019 United Therapeutics Corporation (Nasdaq: UTHR) reported its financial results for the quarter ended September 30, 2019 (Press release, United Therapeutics, OCT 30, 2019, View Source [SID1234550013]).

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"We are pleased to see continued growth during the quarter in the total number of U.S. patients treated with our prostacyclin product franchise, consisting of Remodulin, Tyvaso, and Orenitram," said Michael Benkowitz, President and Chief Operating Officer of United Therapeutics. "As we execute toward our commercial goals, we are also continuing to execute toward our clinical goals, which include the recent label update to indicate that Orenitram delays disease progression and continued progress toward near-term phase III clinical trial readouts for DISTINCT, the study of dinutuximab for small cell lung cancer, and INCREASE, the study of pulmonary hypertension associated with interstitial lung disease."

Revenues for the three months ended September 30, 2019 decreased by $11.2 million as compared to the same period in 2018, driven entirely by a decrease in Adcirca revenues following the onset of generic competition in 2018. Revenues for our other four commercial products grew by $33.1 million in the aggregate for the three months ended September 30, 2019. Additional details regarding each product are discussed below.

Remodulin net product sales increased by $14.7 million for the three months ended September 30, 2019, as compared to the same period in 2018. $32.7 million of the increase was due to an increase in total quantities sold, primarily to our international distributors, partially offset by a decrease of $13.9 million due to price reductions, primarily to our international distributors, and higher gross-to-net revenue deductions of $4.1 million. During the three months ended September 30, 2019, there was an increase in the number of U.S. patients being treated with Remodulin, as compared to the same period in 2018.

Tyvaso net product sales for the three months ended September 30, 2019 increased by $3.0 million, as compared to the same period in 2018, primarily due to a price increase implemented in January 2019.

Orenitram net product sales for the three months ended September 30, 2019 increased by $8.2 million as compared to the same period in 2018. This increase was primarily due to an increase in the number of patients being treated with Orenitram and a price increase implemented in January 2019, partially offset by higher gross-to-net revenue deductions.

Unituxin net product sales for the three months ended September 30, 2019 increased by $7.2 million as compared to the same period in 2018. This increase was due to an increase in the number of vials sold and a price increase implemented in April 2019.

Adcirca net product sales for the three months ended September 30, 2019 decreased by $44.3 million as compared to the same period in 2018. This decrease was primarily due to a decrease in bottles sold following the onset of generic competition for Adcirca beginning in August 2018.

Research and development expense, excluding share-based compensation. Research and development expense decreased by $9.8 million for the three months ended September 30, 2019, as compared to the same period in 2018. Research and development expense for the treatment of cardiopulmonary diseases decreased by $21.9 million for the three months ended September 30, 2019, as compared to the same period in 2018, due to: (1) a one-time $10.0 million payment under a research agreement with MannKind; and (2) an up-front payment of $10.0 million under our license agreement with Samumed, both of which occurred during the three months ended September 30, 2018. The decrease in cardiopulmonary research and development expense was partially offset by an $11.2 million increase in research and development expense for our organ manufacturing projects due to increased preclinical and clinical work on technologies designed to increase the supply of transplantable organs and tissues.

The decrease in share-based compensation expense of $27.5 million for the three months ended September 30, 2019, as compared to the same period in 2018, was primarily due to a $30.8 million decrease in STAP expense driven by a 2 percent increase in our stock price for the three months ended September 30, 2019, as compared to a 13 percent increase in our stock price for the same period in 2018; partially offset by: (1) a $1.8 million increase in stock option expense due to additional awards granted and outstanding in 2019; and (2) a $1.4 million increase in restricted stock unit expense due to additional awards granted and outstanding in 2019.

Other Expense, Net

The increase in other expense, net of $16.0 million for the three months ended September 30, 2019, as compared to the same period in 2018, was primarily due to the recognition of a net unrealized loss in publicly-traded equity securities. During the three months ended September 30, 2019, we recognized $13.0 million of net unrealized losses on these securities.

Impairment of Investment in a Privately-Held Company

During the quarter ended September 30, 2018, one of the privately-held companies in which we invested experienced an event triggering an impairment analysis to evaluate the recoverability of our investment. We determined that the fair value of our investment was lower than its carrying value, resulting in an impairment charge of $12.4 million.

Income Tax Expense

The income tax expense was $34.5 million for the three months ended September 30, 2019, as compared to $33.6 million for the same period in 2018. The income tax expense is based on an estimated effective tax rate (ETR) for the entire year. The estimated annual ETR is subject to adjustment in subsequent quarterly periods if components used to calculate the estimated annual ETR are updated or revised. Our actual ETR as of September 30, 2019 and September 30, 2018 was 33 percent and 21 percent, respectively. We recognized a loss before income taxes, and a corresponding income tax benefit, for the nine months ended September 30, 2019, as a result of the one-time $800.0 million payment to Arena Pharmaceuticals, Inc. in January 2019. As a result of this loss, our anticipated tax credits and foreign sales deduction, partially offset by non-deductible compensation expense, increased our tax benefit and resulting ETR for the nine months ended September 30, 2019, compared to the same period in 2018.

Non-GAAP Earnings

Non-GAAP earnings is defined as net income, adjusted for: (1) share-based compensation expense (including expenses relating to stock options, restricted stock units, share tracking awards and our employee stock purchase plan); (2) impairment of investment in privately-held company; (3) unrealized losses (gains) on equity securities; (4) asset impairment charges; (5) license-related fees; and (6) tax benefit on non-GAAP earnings adjustments.

Inducement Restricted Stock Units

On October 25, 2019, we granted a total of 2,604 restricted stock units under our 2019 Inducement Stock Incentive Plan to three newly hired employees. These restricted stock units vest in three equal installments on October 31, 2020, October 31, 2021 and October 31, 2022, assuming continued employment on such dates, and are subject to the standard terms and conditions we filed with the SEC as Exhibit 10.2 to our Current Report on Form 8-K on March 1, 2019. We are providing this information in accordance with Nasdaq Listing Rule 5635(c)(4).

Conference Call

We will host a half-hour teleconference on Wednesday, October 30, 2019, at 9:00 a.m. Eastern Time. The teleconference is accessible by dialing 1-877-351-5881, with international callers dialing 1-970-315-0533. A rebroadcast of the teleconference will be available for one week by dialing 1-855-859-2056, with international callers dialing 1-404-537-3406, and using access code: 7462119.

This teleconference will also be webcast and can be accessed via our website at View Source

On October 29, 2019, Intrexon Corporation ("Intrexon") and TS AquaCulture LLC ("TS AquaCulture"), a Virginia limited liability company that is managed by Third Security, LLC ("Third Security"), reported that it has entered into a stock purchase agreement (the "Purchase Agreement"), pursuant to which, upon the terms set forth therein, TS AquaCulture purchased from Intrexon 8,239,199 shares of common stock, par value $0.001 per share, of AquaBounty Technologies, Inc., a Delaware corporation ("AquaBounty"), for an aggregate purchase price of $21,586,701.38 and Intrexon assigned to TS AquaCulture all of Intrexon’s rights, and TS AquaCulture accepted and assumed all of such rights and obligations, under the Relationship Agreement, dated as of December 5, 2012, by and between Intrexon and AquaBounty (Filing, 8-K, Intrexon, OCT 29, 2019, View Source [SID1234552291]).

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Randal J. Kirk and shareholders affiliated with him beneficially own approximately 46.2% of Intrexon’s voting stock. Mr. Kirk is Intrexon’s Chief Executive Officer and Chairman of Intrexon’s board of directors (the "Board") and currently serves as the Senior Managing Director and Chief Executive Officer of Third Security and owns 100% of the equity interests of Third Security. Third Security directly owns shares of Intrexon common stock and is also the manager of certain entities that directly own shares of Intrexon common stock, and therefore may be deemed to beneficially own approximately 34.7% of Intrexon’s common stock.

The Purchase Agreement was unanimously approved by the independent members of Intrexon’s Board of Directors, with the recommendation of the Audit Committee and an independent special committee of the Board.

The foregoing is a summary description of certain terms of the Purchase Agreement and, by its nature, is incomplete. A copy of the Purchase Agreement is filed herewith as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference. Intrexon encourages all readers to read the entire text of the Purchase Agreement.

On October 29, 2019 Artelo Biosciences, Inc. (NASDAQ: ARTL), a clinical stage biopharmaceutical company developing therapeutics that modulate the endocannabinoid system, reported that it has selected Aptus Clinical Ltd. (Aptus), a specialist Clinical Contract Research Organization based in the United Kingdom (UK) with particular expertise in oncology, rare diseases and advanced therapies, as its contract research organization (CRO) for the Company’s planned Phase 1b/2a randomized, placebo-controlled trial of ART27.13, its synthetic cannabinoid for the treatment of anorexia and weight loss associated with cancer (Press release, Aptus Clinical, OCT 29, 2019, View Source [SID1234551413]). This latest agreement builds on earlier collaborations between Artelo and Aptus, which included feasibility studies, protocol design, and clinical site identification and selection. The ART27.13 program will continue to be under the operational stewardship of Artelo’s UK subsidiary at the Alderley Park BioHub in Cheshire.

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ART27.13 is a highly potent peripherally selective synthetic dual cannabinoid agonist believed to target peripheral cannabinoid receptors sending a feeding message to the brain. The combined Phase 1b/2a trial is expected to enroll up to 49 subjects at clinical sites within the UK. The study is designed to determine the most effective and well tolerated dose in cancer patients and evaluate activity using criteria such as weight gain, lean body mass, and improvement of anorexia.

Gregory D. Gorgas, President and Chief Executive Officer of Artelo Biosciences, commented, "We are excited to expand our relationship with Aptus, which will allow us to leverage their broad experience as well as their understanding of local regulatory processes combined with a wide network of investigators and key opinion leaders. We look forward to providing further updates as we commence our Phase 1b/2a trial and advance our cancer anorexia program."

Steve McConchie, Chief Executive Officer of Aptus Clinical, added, "We are honored to have been selected by Artelo to help oversee this important trial. Despite the fact that cancer-related anorexia affects about 60% of advanced stage cancer patients, there are no FDA approved drugs for this indication and only a few agents used off-label with limited efficacy. Clearly, patients deserve better and the profile of Artelo’s product candidate is compelling."

On October 29, 2019 Evelo Biosciences (NASDAQ:EVLO), a clinical stage biotechnology company developing a new modality of orally delivered, systemically acting biologics, reported that it will host a conference call and live webcast at 8:30 A.M. ET on Tuesday, November 5, 2019 to report its third quarter financial results and discuss recent business updates (Press release, Evelo Biosciences, OCT 29, 2019, View Source [SID1234550234]).

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To access the live conference call, please dial 866-795-3242 (domestic) or 409-937-8909 (international) and refer to conference ID 7788384. A live webcast of the event will also be available under "News and Events" in the Investors section of Evelo’s website at View Source The archived webcast will be available on Evelo’s website approximately two hours after the completion of the event and will be available for 30 days following the call.

On October 29, 2019, Delcath Systems, Inc. (the "Company") and holders of a majority of the Company’s Series E and Series E-1 Convertible Preferred Stock and related warrants reported that it has entered into a third amendment (the "Third Amendment") to those certain registration rights agreements, dated as of July 11, 2019 (effective as of July 15, 2019) and August 15, 2019, in each case as previously amended on September 30, 2019 and October 18, 2019, between the Company and the holders signatory thereto (collectively, the "Registration Rights Agreements") (Filing, 8-K, Delcath Systems, OCT 29, 2019, View Source [SID1234550180]). The Third Amendment clarifies that the liquidated damages specified in Section 2(d) of the Registration Rights Agreements shall not be payable to any holder whose Registrable Securities, as defined in the Registration Rights Agreements, are fully registered on an effective registration statement on the Effectiveness Date, as defined in the Registration Rights Agreements.

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Also on October 29, 2019, the Company entered into a Waiver and Forbearance Agreement ("Waiver") with Rosalind Master Fund LP and Rosalind Opportunities Fund I LP, holders of its Series E and Series E-1 Convertible Preferred Stock and related warrants (together, "Rosalind"), pursuant to which Rosalind has agreed, among other things, to waive compliance with certain specified terms and conditions under the Registration Rights Agreements and forbear from exercising certain of their rights and remedies related to certain defaults thereunder for the time periods indicated therein.

The foregoing description of the Third Amendment and the Waiver does not purport to be complete and is qualified in its entirety by reference to: (i) the Third Amendment included as Exhibit 10.1 to this Current Report on Form 8-K, (ii) the Waiver included as Exhibit 10.2 to this Current Report on Form 8-K, (iii) the form of Registration Rights Agreement between the Company and each other party signatory thereto included as Exhibit 4.2 to the Current Report on Form 8-K filed with the SEC on July 11, 2019, (iv) the form of Registration Rights Agreement between the Company and each other party signatory thereto included as Exhibit 4.2 to the Current Report on Form 8-K filed with the SEC on August 16, 2019, (v) the Amendment to the Registration Rights Agreements, dated as of September 30, 2019, included as Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on October 1, 2019 and (vi) the Second Amendment to the Registration Rights Agreements, dated as of October 18, 2019, included as Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on October 23, 2019.