On February 28, 2019 gle Pharmaceuticals, Inc. ("Eagle" or the "Company") (Nasdaq: EGRX) reported its financial results for the three months and full year ended December 31, 2018 (Press release, Eagle Pharmaceuticals, FEB 28, 2019, View Source [SID1234533800]). Highlights of, and subsequent to, the fourth quarter of 2018 include:

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Business and Recent Highlights:

· Commenced enrollment in a study to evaluate the neuroprotective effects of RYANODEX (dantrolene sodium) in collaboration with the United States Army Medical Research Institute of Chemical Defense ("USAMRICD"), the nation’s leading science and technology laboratory in the area of medical chemical countermeasures research and development;

· Announced positive results of pre-clinical study conducted to evaluate effects of RYANODEX in Acute Radiation Syndrome ("ARS");

·On February 20, 2019, the FDA issued a decision in favor of Eagle regarding the scope of BENDEKA’s Orphan Drug Exclusivity ("ODE"), further protecting the longevity of the BENDEKA franchise; and

·Executed a $50.0 million accelerated share repurchase ("ASR") as part of our $150.0 million share repurchase program (the "Share Repurchase Program").

Financial Highlights:

Fourth Quarter 2018

· Total revenue for the fourth quarter of 2018 was $56.1 million, compared to $46.8 million in the fourth quarter of 2017;

· Q4 2018 bendamustine hydrochloride 500ml solution ("Big Bag" or "BELRAPZO") product sales were $6.8 million; in February of 2019, the Company achieved peak market share of 10%, according to IQVIA Holdings Inc.;

· Q4 2018 RYANODEX product sales were $5.1 million, up 10% compared to Q4 2017;

· Q4 2018 net income was $12.6 million, or $0.88 per basic and $0.86 per diluted share, compared to net income of $9.1 million, or $0.61 per basic and $0.58 per diluted share in Q4 2017;

· Q4 2018 adjusted non-GAAP net income was $17.7 million, or $1.23 per basic and $1.20 per diluted share, compared to adjusted non-GAAP net income of $15.6 million, or $1.05 per basic and $1.00 per diluted share in Q4 2017; and

·Q4 2018, Eagle executed a $50.0 million ASR of common stock as part of the Share Repurchase Program.

Full Year 2018

· Total revenue for the twelve months ended December 31, 2018 was $213.3 million, compared to $236.7 million in 2017 including $37.5 million in milestone payments for BENDEKA, reflecting revenue growth of 7% when excluding milestone payments;

·2018 net income was $31.9 million, or $2.16 per basic and $2.09 per diluted share, compared to net income of $51.9 million, or $3.44 per basic and $3.27 per diluted share in 2017;

· 2018 adjusted non-GAAP net income was $59.2 million, or $4.01 per basic and $3.87 per diluted share, compared to adjusted non-GAAP net income of $69.0 million, or $4.57 per basic and $4.34 per diluted share in 2017;

· From August 2016 through December 31, 2018, Eagle has repurchased $154.0 million of its common stock; and

· Cash and cash equivalents were $78.8 million, accounts receivable was $66.5 million, and debt was $45.0 million as of December 31, 2018.

"We had another outstanding quarter, nearly doubling our product sales in Q4 2018 compared to Q4 2017 and generating 20% growth in total quarterly revenue year over year. We were able to deliver substantial cash flow throughout the year, repurchase $78 million of our own shares, and maintain a very strong balance sheet with which to execute our development and commercial activities," stated Scott Tarriff, Chief Executive Officer of Eagle Pharmaceuticals.

"There are multiple exciting opportunities we plan to advance in 2019. The study initiated with the U.S. Military to evaluate RYANODEX in the treatment of nerve agent exposure is progressing nicely. Three of the six animal cohorts have now been challenged. The results of our pre-clinical study to evaluate the effect of RYANODEX in treating ARS are encouraging, and we are continuing our dialogue with the FDA regarding a path forward for EHS. As the year unfolds, we look forward to gaining greater clarity regarding our pipeline, exploring new opportunities with existing products, and delivering a very efficient business model that provides the cash necessary to execute our development, commercial activities, and potential licensing opportunities," concluded Tarriff.

Fourth Quarter 2018 Financial Results

Total revenue for the three months ended December 31, 2018 was $56.1 million, as compared to $46.8 million for the three months ended December 31, 2017. Royalty revenue was $35.7 million, compared to $36.4 million in the fourth quarter of 2017. BENDEKA royalties were $31.9 million, compared to $34.7 million in the fourth quarter of 2017. A summary of total revenue is outlined below:

Gross Margin was 67% during the fourth quarter of 2018, as compared to 71% in the fourth quarter of 2017. The year over year compression in gross margin resulted from the introduction of Big Bag revenue was partly offset by an expansion in RYANODEX gross margin.

R&D expenses were $5.9 million for the quarter, compared to $9.4 million in the prior year quarter. The fourth quarter year over year decrease reflects a substantial reduction in fulvestrant expenses, partially offset by the cost of analytical work to support our vasopressin ANDA. Excluding stock-based compensation and other non-cash and non-recurring items, R&D expense during the fourth quarter was $4.4 million.

SG&A expenses in the fourth quarter of 2018 increased to $15.5 million in the fourth quarter of 2018 compared to $13.4 million in the fourth quarter of 2017. External legal expenses account for the year over year increase. Excluding stock-based compensation and other non-cash and non-recurring items, fourth quarter 2018 SG&A expense was $11.3 million.

Net income for the fourth quarter of 2018 was $12.6 million, or $0.88 per basic and $0.86 per diluted share, compared to net income of $9.1 million, or $0.61 per basic and $0.58 per diluted share in the three months ended December 31, 2017, due to the factors discussed above.

Adjusted non-GAAP net income for the fourth quarter of 2018 was $17.7 million, or $1.23 per basic and $1.20 per diluted share, compared to adjusted non-GAAP net income of $15.6 million or $1.05 per basic and $1.00 per diluted share in the fourth quarter of 2017. For a full reconciliation of adjusted non-GAAP net income to the most comparable GAAP financial measures, please see the tables at the end of this press release.

Full Year 2018 Financial Results

The increase in product sales in 2018 was driven primarily by the launch of Big Bag, as well as continued growth in RYANODEX revenue. Royalty revenue totaled $142.9 million in 2018 compared to $153.9 million in 2017. In 2018, Eagle did not earn any license and other income. In 2017, Eagle earned certain contractual milestones in connection with the Company’s BENDEKA licensing agreement with Teva, as well as an upfront payment associated with the SymBio collaboration covering Japanese rights for bendamustine hydrochloride ready-to-dilute and rapid infusion injection products.

Gross margin was 71% in 2018, as compared to 76% in 2017. The year over year compression in gross margin resulted from the introduction of Big Bag revenue was partly offset by an expansion in RYANODEX gross margin.

R&D expense increased to $44.4 million in 2018, compared to $32.6 million in 2017, reflecting the cost of the fulvestrant trial as well as the vasopressin analytical work. Excluding stock-based compensation and other non-cash and non-recurring items, R&D expense in 2018 was $37.8 million.

SG&A expenses decreased by $10.9 million to $60.5 million in 2018, compared to $71.4 million in 2017. In 2017, SG&A included increased marketing expense related to exertional heat stroke ("EHS") and the contract sales force agreement with Spectrum. The elimination of those expenses in 2018 was partly offset by an increase in external legal expenses. Excluding stock-based compensation and other non-cash and non-recurring items, SG&A expense in 2018 was $43.1 million.

Net income for the year ended December 31, 2018 was $31.9 million or $2.16 per basic and $2.09 per diluted share as compared to net income of $51.9 million or $3.44 per basic and $3.27 per diluted share for the year ended December 31, 2017, as a result of the factors discussed above.

Adjusted non-GAAP net income for 2018 was $59.2 million, or $4.01 per basic and $3.87 per diluted share, compared to adjusted non-GAAP net income of $69.0 million, or $4.57 per basic and $4.34 per diluted share in 2017.

Liquidity

As of December 31, 2018, the Company had $78.8 million in cash and cash equivalents and $66.5 million in net accounts receivable, $41.8 million of which was due from Teva Pharmaceutical Industries Ltd. The Company had $45.0 million in outstanding debt.

In the fourth quarter of 2018, we purchased $50.0 million of Eagle’s common stock as part of our $150.0 million Share Repurchase Program. From August 2016 through December 31, 2018, we have repurchased $154.0 million of our common stock, including the $50.0 million ASR. As disclosed on October 30, 2018, the Company’s Board of Directors retired the prior share repurchase programs and approved the new $150.0 million Share Repurchase Program (which includes the ASR).

Conference Call

As previously announced, Eagle management will host its fourth quarter and full year 2018 conference call as follows:

Date

Thursday, February 28, 2019

Time

8:30 A.M. EST

Toll free (U.S.)

877-876-9177

International

785-424-1672

Webcast (live and replay)

www.eagleus.com, under the "Investor + News" section

A replay of the conference call will be available for one week after the call’s completion by dialing 800-283-4799 (US) or 402-220-0860 (International) and entering conference call ID EGRXQ418. The webcast will be archived for 30 days at the aforementioned URL.

On February 28, 2019 OncBioMune Pharmaceuticals, Inc. (OTCQB:OBMP) ("OncBioMune" or the "Company"), a clinical-stage biopharmaceutical company engaged in the development of a proprietary therapeutic cancer vaccine immunotherapy and targeted cancer therapy, reported that it has entered into a consulting agreement with CATO Research, LLC, a global provider of regulatory and clinical research services, effective immediately (Press release, Oncbiomune, FEB 28, 2019, View Source [SID1234533799]).

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This agreement relates to the formation of the clinical development plan of OncBioMune’s patented targeted chemotherapy combining paclitaxel, gallium, and transferrin, otherwise known as "PGT."

PGT is designed to deliver the chemotherapeutic agent paclitaxel to cancer cells over-expressing the transferrin receptor (aka CD71). Paclitaxel is currently FDA-approved in two forms: as solvent-based paclitaxel (sb-paclitaxel, Taxol) and protein-based paclitaxel (nab-paclitaxel, ABRAXANE ).

PGT binds paclitaxel to the human protein transferrin as opposed to albumin, which is employed in nab-paclitaxel. This creates the potential to target the paclitaxel to CD71, which has been shown to be over-expressed on many different cancer types. Additionally, PGT takes advantage of the fact that the transferrin protein has binding sites for iron that can bind a different metal ion, gallium, which has anti-cancer activity. In theory, this creates a novel protein drug complex which has the capacity to deliver two, non-cross resistant cancer therapeutics in a targeted fashion.

"We are thrilled to be able to partner with a high-quality provider such as CATO Research as we work together toward the goal of getting PGT accessible to patients with refractory cancers," commented Dr. Brian Barnett, Chief Executive Officer at OncBioMune. "We believe, given their experience in drug development, that CATO Research will be instrumental in helping us accomplish the goal of providing new safe and effective alternatives to this patient population with a high unmet medical need."

On February 28, 2019 G1 Therapeutics, Inc. (Nasdaq: GTHX), a clinical-stage oncology company, reported financial results for the fourth quarter and full-year ended December 31, 2018 (Press release, G1 Therapeutics, FEB 28, 2019, View Source [SID1234533798]). The company also highlighted 2018 operational results and upcoming 2019 milestones.

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"Data from four randomized Phase 2 trials showed the benefits of trilaciclib across different indications, lines of therapy and chemotherapy regimens," said Raj Malik, M.D., Chief Medical Officer and Senior Vice President, R&D. "We have scheduled meetings with U.S. and European regulatory authorities in the first half of 2019 to discuss the totality of data and next steps for the development of trilaciclib. We will provide an update on these meetings in the second quarter."

"We made substantial progress across our three clinical-stage product candidates in 2018. We reported positive results from all four Phase 2 trilaciclib trials, presented proof-of-concept data on lerociclib in breast cancer, initiated a trial of lerociclib in non-small cell lung cancer, and brought our oral selective estrogen receptor degrader G1T48 into the clinic," said Mark Velleca, M.D., Ph.D., Chief Executive Officer. "These accomplishments will drive a number of important clinical and regulatory milestones in 2019 in the advancement of our pipeline."

Corporate Highlights

Reported positive multi-lineage myelopreservation data from three randomized, double-blind, placebo-controlled Phase 2 trials of trilaciclib in small cell lung cancer (SCLC): In the fourth quarter, the company presented additional data from its Phase 2 trial of trilaciclib in combination with chemotherapy in first-line SCLC at the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) 2018 Congress, and reported preliminary data from Phase 2 trials in first-line SCLC in combination with chemotherapy/Tecentriq (atezolizumab) and second/third-line SCLC in combination with chemotherapy. In these trials, patients receiving trilaciclib showed statistically significant improvements in duration and occurrence of severe neutropenia (primary endpoints) and clinically meaningful reductions in G-CSF administrations and red blood cell transfusions. Treatment was well tolerated and the safety profile of trilaciclib was consistent across the three trials.

Presented preliminary improved progression-free survival data from randomized Phase 2 trial of trilaciclib in combination with chemotherapy in patients with metastatic triple-negative breast cancer (mTNBC): In December, the company presented data from its Phase 2 trial of trilaciclib in patients with mTNBC at the 2018 San Antonio Breast Cancer Symposium. Preliminary median progression-free survival (PFS) was 5.4 months in the chemotherapy arm, 8.8 months in the chemotherapy and trilaciclib (dosed the day of chemotherapy) arm (hazard ratio 0.52, p=0.0669), and 7.3 months in the chemotherapy and trilaciclib (dosed the day prior to and day of chemotherapy) arm (hazard ratio 0.49; p=0.0546). A combined analysis of trilaciclib-treated patients showed PFS of 5.4 months for the chemotherapy arm and 7.9 months for chemotherapy and trilaciclib (hazard ratio 0.50, p=0.0189). Patients on trilaciclib received more chemotherapy cycles than those in the control arm. The safety profile of trilaciclib was consistent with previously reported trials; no trilaciclib-related serious adverse events were reported.

Anticipated Milestones for 2019

Meet with U.S. and European regulatory authorities in the first half of 2019 and announce the next steps for trilaciclib development in the second quarter of 2019.

Initiate additional randomized trials for trilaciclib in the second half of 2019, pending feedback from regulatory authorities.

Report additional data from all four randomized Phase 2 trilaciclib clinical trials.

Present additional data from the Phase 1b clinical trial of lerociclib/Faslodex (fulvestrant) in ER+, HER2- breast cancer in the second half of 2019.

Present preliminary dose-escalation data from the Phase 1b clinical trial of lerociclib/Tagrisso (osimertinib) in non-small cell lung cancer in the second half of 2019.

Present preliminary dose-escalation data from the Phase 1 clinical trial of G1T48, an oral selective estrogen receptor degrader (SERD), in ER+ breast cancer in the second half of 2019.

Fourth Quarter and Full-Year 2018 Financial Highlights

Cash Position: Cash, cash equivalents and short-term investments totaled $369.3 million as of December 31, 2018, compared to $390.5 million as of September 30, 2018, and $103.8 million as of December 31, 2017.

Operating Expenses: Operating expenses were $26.1 million for the fourth quarter of 2018, compared to $17.3 million for the fourth quarter of 2017. GAAP operating expenses include stock-based compensation expense of $3.3 million for the fourth quarter of 2018, compared to $1.0 million for the fourth quarter of 2017. Operating expenses for the full-year 2018 were $89.3 million, compared to $61.0 million for the prior year. Stock-based compensation expense for the full-year 2018 was $10.2 million, compared to $3.4 million for the prior year.

Research and Development Expenses: Research and development (R&D) expenses for the fourth quarter of 2018 were $19.1 million, compared to $15.1 million for the fourth quarter of 2017. The increase in expense was due to an increase in clinical program costs, drug manufacturing costs to support clinical programs, external research studies and personnel costs due to additional headcount. R&D expenses for the full-year 2018 were $70.7 million, compared to $53.9 million for the prior year.

General and Administrative Expenses: General and administrative (G&A) expenses for the fourth quarter of 2018 were $7.0 million, compared to $2.2 million for the fourth quarter of 2017. The increase in expense was largely due to an increase in professional fees and personnel-related costs. G&A expenses for the full-year 2018 were $18.6 million, compared to $7.1 million for the prior year.

Net Loss: G1 reported a net loss of $24.1 million for the fourth quarter of 2018, compared to $17.0 million for the fourth quarter of 2017. Net loss for the full-year 2018 was $85.3 million, compared to a net loss of $60.1 million for the prior year.

Webcast and Conference Call

The management team will host a webcast and conference call at 4:30 p.m. ET today to provide a financial update for the fourth quarter and full-year of 2018. The live call may be accessed by dialing 866-763-6020 (domestic) or 210-874-7713 (international) and entering the conference code: 2698949. A live and archived webcast will be available on the Events & Presentations page of the company’s website: www.g1therapeutics.com. The webcast will be archived on the same page for 90 days following the event.

Clinical program updates will be provided at the Investor Day 2019 meeting on March 6.

On February 28, 2018 Pacira Pharmaceuticals, Inc. (NASDAQ: PCRX) reported financial results for the fourth quarter and full year of 2018 and its outlook for 2019 (Press release, Pacira Pharmaceuticals, FEB 28, 2019, View Source;p=RssLanding&cat=news&id=2389460 [SID1234533797]).

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2018 Financial Highlights

Fourth quarter EXPAREL net product sales of $94.4 million

Full year EXPAREL net product sales of $331.1 million

Fourth quarter GAAP net income of $8.3 million or $0.20 per diluted share

Fourth quarter non-GAAP net income of $19.8 million or $0.47 per diluted share

Full year GAAP net loss of $0.5 million or $0.01 per basic and diluted share

Full year non-GAAP net income of $43.5 million or $1.04 per diluted share
"Pacira had a landmark 2018 with record revenues underscoring the growing marketplace adoption of EXPAREL as a fundamental component of opioid-sparing pain management protocols at influential academic centers and also the success of our brachial plexus nerve block launch," said Dave Stack, chairman and chief executive officer of Pacira. "There is great enthusiasm among a growing number of anesthesiologists who are using regional nerve blocks and field blocks to revolutionize postsurgical pain management and improve patient outcomes. We are also seeing robust growth in new accounts driven primarily by ambulatory, plastic, and oral surgery centers seeking to differentiate their practices by providing patients with an effective, long-acting non-opioid option for managing postsurgical pain. Finally, our significant partnership with Johnson and Johnson continues to drive uptake with EXPAREL being integrated across its world class educational platforms and comprehensive offering of orthopedic procedural solutions. Altogether this strong growth trajectory provides us with a solid operating foundation to support the strategic expansion of our commercial and clinical offering within the non-opioid pain management and regenerative health space."

"This substantial momentum has continued into 2019 and we plan to build on our success by executing on multiple growth opportunities, including expanding the role of EXPAREL as a catalyst for shifting inpatient procedures to the ambulatory setting, and building out our differentiated non-opioid portfolio with innovative products that address the need for improving patients’ journeys along the neural pain pathway. We believe this strategy provides the greatest opportunities to build value in both the near- and long-term," concluded Mr. Stack.

Recent Highlights

EXPAREL manufacturing capacity expansion to meet growing demand. In February 2019, Pacira announced that commercial production of EXPAREL is now underway at a custom suite in Swindon, UK created under the company’s partnership with Thermo Fisher Scientific Pharma Services (formerly Patheon UK Limited). This suite was designed to mirror the company’s existing facility at the Pacira Science Center Campus in San Diego, CA and is expected to double the company’s manufacturing capacity. Through the partnership, the companies are developing a second dedicated suite that is expected to enable another doubling of EXPAREL manufacturing capacity in approximately two years.

Phase 4 EXPAREL study achieves statistically significant reductions in opioid consumption and pain scores in C-Section patients. In January 2019, Pacira announced that its Phase 4 study of EXPAREL in patients undergoing Cesarean section (C-section) achieved its primary endpoint with a statistically significant reduction in total postsurgical opioid consumption through 72 hours (P<0.05). EXPAREL also achieved statistical significance for reduction in pain intensity scores through 72 hours (P<0.05). The full study results will be submitted for publication in peer-reviewed medical literature later this year.

Centers for Medicare and Medicaid Services establish new reimbursement for EXPAREL. In November 2018, the Centers for Medicare and Medicaid Services (CMS) finalized a policy to provide separate Medicare reimbursement for EXPAREL when administered in ambulatory surgical centers (ASCs) through establishment of the product-specific billing code of C9290. This code, which provides payment for EXPAREL at $1.22 per milligram, sets national Medicare reimbursement rates for EXPAREL administered in ASCs. In addition, the American Dental Association published a CDT code (D9613) to report infiltration of a sustained-release therapeutic drug in oral surgery procedures. Both codes became effective on January 1, 2019.

New data show EXPAREL significantly reduces opioid use, hospital length of stay and total hospitalization costs following TKA. In November 2018, Pacira announced new data were published in The Journal of Medical Economics on the use of EXPAREL to manage postsurgical pain following total knee arthroplasty (TKA). The findings showed that patients receiving EXPAREL had a significant reduction in opioid use, hospital length of stay (LOS), and total hospitalization costs compared to TKA patients who did not receive EXPAREL. Patients receiving EXPAREL also had increased likelihood to be discharged home rather than a skilled nursing facility.
Fourth Quarter 2018 Financial Results

EXPAREL net product sales were $94.4 million in the fourth quarter of 2018, a 20% increase over the $78.7 million reported for the fourth quarter of 2017.

Total revenues were $95.1 million in the fourth quarter of 2018, a 20% increase over the $79.1 million reported for the fourth quarter of 2017.

Total operating expenses were $82.9 million in the fourth quarter of 2018, compared to $70.6 million in the fourth quarter of 2017.

GAAP net income was $8.3 million, or $0.20 per share (basic and diluted) in the fourth quarter of 2018, compared to GAAP net income of $4.6 million, or $0.11 per share (basic and diluted), in the fourth quarter of 2017.

Non-GAAP net income was $19.8 million, or $0.48 per share (basic) and $0.47 per share (diluted), in the fourth quarter of 2018, compared to non-GAAP net income of $16.0 million, or $0.39 per share (basic) and $0.38 per share (diluted), in the fourth quarter of 2017.

Pacira had 41.1 million basic weighted average shares of common stock outstanding in the fourth quarter of 2018.

Pacira had 42.2 million diluted weighted average shares of common stock outstanding in the fourth quarter of 2018.
Full-Year 2018 Financial Results

EXPAREL net product sales were $331.1 million in 2018, a 17% increase over the $282.9 million reported in 2017.

Total revenues were $337.3 million in 2018, an 18% increase over the $286.6 million reported in 2017.

Total operating expenses were $321.4 million in 2018, compared to $311.6 million in 2017.

GAAP net loss was $0.5 million, or $0.01 per share (basic and diluted) in 2018, compared to a GAAP net loss of $42.6 million, or $1.07 per share (basic and diluted) in 2017.

Non-GAAP net income was $43.5 million, or $1.06 per share (basic) and $1.04 per share (diluted), in 2018, compared to non-GAAP net income of $8.6 million, or $0.22 per share (basic) and $0.21 per share (diluted), in 2017.

Pacira ended 2018 with cash, cash equivalents, short-term and long-term investments ("cash") of $409.3 million.

Pacira had 40.9 million basic weighted average shares of common stock outstanding in 2018.

For non-GAAP measures, Pacira had 41.9 million diluted weighted average shares of common stock outstanding in 2018.
2019 Outlook

Pacira announces its full year 2019 financial guidance as follows. Pacira expects:

EXPAREL net product sales of $400 million to $410 million.

Non-GAAP gross margins of 75% to 76%.

Non-GAAP research and development (R&D) expense of $60 million to $70 million.

Non-GAAP selling, general and administrative (SG&A) expense of $165 million to $175 million.

Stock-based compensation of $30 million to $35 million.
See "Non-GAAP Financial Information" and "Reconciliations of GAAP to Non-GAAP 2019 Financial Guidance" below.

Today’s Conference Call and Webcast Reminder

The Pacira management team will host a conference call to discuss the company’s financial results and recent developments today, Thursday, February 28, 2019, at 8:30 a.m. ET. The call can be accessed by dialing 1-877-845-0779 (domestic) or 1-720-545-0035 (international) ten minutes prior to the start of the call and providing the Conference ID 6050757.

A replay of the call will be available approximately two hours after the completion of the call and can be accessed by dialing 1-855-859-2056 (domestic) or 1-404-537-3406 (international) and providing the Conference ID 6050757. The replay of the call will be available for two weeks from the date of the live call.

The live, listen-only webcast of the conference call can also be accessed by visiting the "Investors & Media" section of the company’s website at investor.pacira.com. A replay of the webcast will be archived on the Pacira website for two weeks following the call.

Non-GAAP Financial Information

This press release contains financial measures that do not comply with U.S. generally accepted accounting principles (GAAP), such as non-GAAP net income (loss), non-GAAP net income (loss) per share, non-GAAP cost of goods sold, non-GAAP gross margins, non-GAAP research and development (R&D) expense and non-GAAP selling, general and administrative (SG&A) expense, because such measures exclude milestone revenue, stock-based compensation, amortization of debt discount, loss on early extinguishment of debt, exit costs related to the discontinuation of DepoCyt(e) production and loss on an unexercised investment purchase option.

These measures supplement the company’s financial results prepared in accordance with GAAP. Pacira management uses these measures to better analyze its financial results, estimate its future cost of goods sold, gross margins, R&D expense and SG&A expense outlook for 2019 and to help make managerial decisions. In management’s opinion, these non-GAAP measures are useful to investors and other users of our financial statements by providing greater transparency into the operating performance at Pacira and the company’s future outlook. Such measures should not be deemed to be an alternative to GAAP requirements or a measure of liquidity for Pacira. Non-GAAP measures are also unlikely to be comparable with non-GAAP disclosures released by other companies. See the tables below for a reconciliation of GAAP to non-GAAP measures, and a reconciliation of our GAAP to non-GAAP 2019 financial guidance for gross margins, R&D expense and SG&A expense.

On February 28, 2019 argenx (Euronext & Nasdaq: ARGX), a clinical-stage biotechnology company developing a deep pipeline of differentiated antibody-based therapies for the treatment of severe autoimmune diseases and cancer, reported its fourth quarter business update and full year results for 2018 (Press release, argenx, FEB 28, 2019, View Source [SID1234533796]).

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The full year results will be discussed during a conference call and webcast presentation today at 3 pm CET/9 am EST. To participate in the conference call, please select your phone number below and use the confirmation code 9795988. The webcast may be accessed on the homepage of the argenx website at www.argenx.com or by clicking here.

"By translating fundamental immunology breakthroughs into novel product candidates, we have built a robust pipeline of differentiated antibodies with the potential to truly impact patients’ lives," commented Tim Van Hauwermeiren, CEO of argenx. "We made great progress in 2018 with our wholly owned lead asset efgartigimod, advancing development across four severe autoimmune indications, in both intravenous and subcutaneous formulations. We signed a transformational global collaboration and license agreement with Janssen to develop cusatuzumab in AML while retaining key commercial rights to the product in the U.S. We also announced that AbbVie exercised its option to in-license ARGX-115 targeting GARP.

"Based on our deep and diversified product candidate portfolio, a solid cash position and an ambitious business plan we are facing an abundance of opportunity ahead in 2019. We will continue to build out our novel pipeline through our Innovative Access Program and our commercial capabilities as we drive enrollment of the Phase 3 ADAPT trial of efgartigimod in gMG and plan for the start of a second Phase 3 trial in ITP."

FOURTH QUARTER 2018 AND RECENT HIGHLIGHTS

argenx continues to build a deep pipeline of differentiated antibody-based product candidates, including wholly-owned efgartigimod for the treatment of severe autoimmune diseases and cusatuzumab for the treatment of acute myeloid leukemia (AML) and high-risk myelodysplastic syndromes (MDS) in collaboration with Janssen. Through its Innovative Access Program, argenx grows its proprietary and partnered pipeline by leveraging its antibody expertise to match fundamental biology breakthroughs at leading research institutions.

Efgartigimod (ARGX-113) Program

· Full Phase 2 immune thrombocytopenia (ITP) trial data presented during American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting

o Correlation between IgG antibody reduction, platelet count increase and reduction of bleeding events following efgartigimod treatment.

o Increasing separation between treatment arms and placebo at increasing response thresholds observed, with response rates of 46% and 67% in primary trial and first dosing cycle of open-label extension trial, respectively.

o Primary endpoint analysis revealed efgartigimod to be well-tolerated in all patients consistent with tolerability analysis from Phase 1 healthy volunteer study.

· Orphan drug designation granted in February 2019 by U.S. Food and Drug Administration (FDA) for use for primary ITP.

o argenx additionally received orphan drug designation for efgartigimod in generalized myasthenia gravis (gMG) from FDA and the European Medicines Agency, which was announced, respectively, in September 2017 and March 2018.

· By mid-2019, argenx expects to close its ongoing open-label extension study as part of the completed Phase 2 proof-of-concept trial in ITP in anticipation of the start of a more chronic dosing regimen in its Phase 3 trial.

Cusatuzumab (ARGX-110) Program

· Updated Phase 1/2 AML trial data in combination with azacitidine presented during ASH (Free ASH Whitepaper) Annual Meeting.

o Overall response rate (ORR) of 92% in 12 newly diagnosed AML patients unfit for intensive chemotherapy, including 10 patients (91%) with a complete remission with or without hematologic recovery (CR/CRi) and 1 patient (9%) with partial remission (PR).

o Five patients (42%) achieved minimal residual disease (MRD) negativity. Translational data demonstrated that cusatuzumab monotherapy and in combination with azacitidine significantly reduced leukemic stem cells in the bone marrow of AML patients.

o Well-tolerated with no exacerbation of azacitidine toxicity.

· Orphan drug designation granted by FDA in January 2019 for use of cusatuzumab for AML.

Collaborations

· Entered global collaboration and license agreement with Halozyme for ENHANZE technology (February 2019).

· Gained access to ENHANZE subcutaneous delivery technology for up to three targets, including exclusive rights to develop therapeutic products targeting human neonatal Fc receptor FcRn.

· Upfront payment of $30 million paid to Halozyme with potential future payments up to $160 million per selected target subject to achievement of specified development, regulatory and sales-based milestones.

· Entered exclusive global collaboration and license agreement with Janssen for cusatuzumab

· Deal totaling up to $1.6 billion, plus royalties ranging from the low double digits to the high teens, to develop cusatuzumab in AML, MDS and other hematological malignancies.

Received $300 million upfront cash payment, and Johnson & Johnson Innovation made equity investment of €176.7 million ($200.0 million based on exchange rate on date of signing) in argenx, representing 4.68% of then-outstanding share capital.

· argenx retains right to co-promote cusatuzumab in the U.S. and share such royalties with Janssen on a 50-50 basis.

Corporate Updates

· Awarded €2.6 million grant from Flanders Innovation and Entrepreneurship (VLAIO) agency to explore new applications and modes of action of proprietary ABDEG technology, the Fc engineering technology used in the design of efgartigimod to augment clearance of disease-causing autoantibodies.

· Selected for BEL 20 Index on Euronext Brussels and awarded ‘Best BEL 20 Company’ for 2018.

· Intellectual property portfolio (which includes both owned and in-licensed patent rights) now includes 105 granted and 106 pending patents, covering lead assets and core technologies.

· Company expanded to 132 employees and consultants in support of growing business needs.

OUTLOOK 2019

In 2019, argenx expects to execute on its business plan towards the below milestones:

· Continue enrollment of efgartigimod in ongoing Phase 3 ADAPT and ADAPT+ trials in gMG

· Launch Phase 3 clinical trial with efgartigimod in ITP in second half of 2019

· Launch Phase 2 clinical trial with subcutaneous formulation of efgartigimod in ITP in first half of 2019

· Launch cohort 3 of Phase 2 proof-of-concept trial of efgartigimod in pemphigus vulgaris in first half of 2019

· Launch Phase 2 clinical trial with efgartigimod in chronic inflammatory demyelinating polyneuropathy before end of 2019

· Launch Phase 1 clinical trial with subcutaneous ENHANZE formulation of efgartigimod in healthy volunteers

· Host R&D day (May 22, 2019) to present new pipeline programs ARGX-117 and ARGX-118

Details of the Financial Results

Cash, cash equivalents and current financial assets totaled €564.6 million as of December 31, 2018, compared to €359.8 million on December 31, 2017. The increase in the year-end cash balance on December 31, 2018 resulted primarily from €240.9 million of net proceeds received from the follow-on public offering of American Depositary Shares on the Nasdaq Global Select Market in September 2018.

Operating income decreased by €12.1 million for the year ended December 31, 2018 to €29.2 million, compared to €41.3 million for the year ended December 31, 2017. The decrease in 2018 was primarily related to a €11.5 million decrease in the recognition of upfront payments.

Research and development expenses totaled €83.6 million and €51.7 million for the years ended December 31, 2018 and 2017, respectively. The increase in 2018 resulted primarily from higher external research and development expenses and personnel expenses, reflecting higher clinical trials costs and manufacturing expenses related to the development of the argenx product candidate portfolio and the recruitment of additional employees to support its research and development activities. argenx employed 75 employees in its research and development functions on December 31, 2018, compared to 58 employees on December 31, 2017.

Selling, general and administrative expenses totaled €27.5 million and €12.4 million for the years ended December 31, 2018 and 2017, respectively. The increase of €15.1 million in selling, general and administrative expenses for the year ended December 31, 2018 primarily resulted from higher personnel expenses and consulting fees related to the preparation for potential future commercialization of lead product candidate efgartigimod. On December 31, 2018, argenx employed 30 employees in its selling, general and administrative functions, compared to 15 employees on December 31, 2017.

For the year ended December 31, 2018, financial income amounted to €3.7 million compared to €1.3 million for the year ended December 31, 2017. The increase of €2.4 million in 2018 related primarily to an increase in the interest received on cash, cash equivalents and current financial assets.

Exchange gains totaled €12.3 million for the year ended December 31, 2018 compared to the €5.8 million exchange losses incurred for the year ended December 31, 2017. The increase was mainly attributable to unrealized exchange rate gains on the cash and current financial assets position in U.S. dollars due to the favorable fluctuation of the EUR/USD exchange rate in 2018.

The total comprehensive loss for the year ended December 31, 2018 was €66.6 million, compared to €28.1 million for the year ended December 31, 2017.

U.S. SEC and statutory financial reporting

argenx’s primary accounting standard for quarterly earnings releases and annual reports is International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). Quarterly summarized statements of profit and loss based on IFRS as issued by the IASB are available on www.argenx.com.

In addition to reporting financial figures in accordance with IFRS as issued by the IASB, argenx also reports financial figures in accordance with IFRS as adopted by the European Union (EU) for statutory purposes. The consolidated statement of financial position, the consolidated statements of profit and loss, the consolidated statements of cashflow, and the consolidated statement of changes in equity are not affected by any differences between IFRS as issued by the IASB and IFRS as adopted by the EU.

The consolidated statement of profit and loss data of argenx SE as of December 31, 2018 presented in this press release is unaudited.

Annual Report 2018

argenx expects to publish its 2018 Annual Report based on IFRS as issued by the IASB and its 2018 Annual Report for statutory purposes based on IFRS as adopted by the EU on March 26, 2019. These Annual Reports will be available on www.argenx.com.

EXPECTED 2019 FINANCIAL CALENDAR

· May 7, 2019: Annual General Meeting

· May 9, 2019: Q1 2019 business update and financial results

· August 1, 2019: HY 2019 business update and financial results

· October 24, 2019: Q3 2019 business update and financial results

Dial-in numbers:

Please dial in 5–10 minutes prior to 3 p.m. CET/ 9 a.m. ET using the number and conference ID below.

Confirmation Code: 9795988

Belgium

+32 (0)2 400 9874

Belgium

0800 48740

France

+33 (0)1 767 00794

France

0805 103028

Netherlands

+31 (0)20 714 3545

Netherlands

0800 0249557

United Kingdom

+44 (0)844 571 8892

United Kingdom

0800 376 7922

United States

+1 (631) 510 7495

United States

+1 (866) 966 1396

A question and answer session will follow the presentation of the results. Go to www.argenx.com to access the live audio webcast. The archived webcast will also be available (90 days) for replay shortly after the close of the call from the "Downloads" section of the argenx website.