Integra LifeSciences Commences Previously Announced Cash Tender Offer to Acquire Derma Sciences, Inc.

On January 25, 2017 Integra LifeSciences Holdings Corporation ("Integra") (NASDAQ:IART), a global leader in medical technology, reported that its wholly-owned subsidiary, Integra Derma, Inc. ("Offeror"), is commencing a cash tender offer to purchase all outstanding common and preferred shares of Derma Sciences, Inc. ("Derma Sciences") (NASDAQ:DSCI) at an offer price of $7.00 per share for Derma Sciences’ common stock, $32.00 per share for Derma Sciences’ Series A Convertible Preferred Stock and $48.00 per share for Derma Sciences’ Series B Convertible Preferred Stock (Press release, Integra LifeSciences, JAN 25, 2017, View Source [SID1234517586]). The tender offer is being made pursuant to an Offer to Purchase, dated January 25, 2017 (the "Offer to Purchase"), and in connection with the Agreement and Plan of Merger, dated January 10, 2017, among Integra, Offeror and Derma Sciences (the "Merger Agreement"), which Integra and Derma Sciences previously announced on January 10, 2017.

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The tender offer will expire at 12:00 midnight, New York City time, on Wednesday, February 22, 2017, unless the offer period is extended or earlier terminated in accordance with the terms of the Merger Agreement (such date and time, as it may be extended, the "Expiration Date"). Offeror is required to extend the offer period for any period required by applicable law or rules and regulations of the SEC and for one or more periods of up to ten business days each until, and including, July 15, 2017, if at the Expiration Date any of the conditions to the tender offer have not been satisfied.

There is no financing condition to the tender offer. The obligation of Offeror to pay for shares tendered pursuant to the tender offer is conditioned on the tender and acceptance of that number of shares that, together with the number of shares (if any) then owned by Integra, represents at least a majority of (i) the voting power of all outstanding common and preferred shares, voting together as a single class, (ii) the outstanding shares of Series A Convertible Preferred Stock and (iii) the outstanding shares of Series B Convertible Preferred Stock, as well as other customary conditions. Following the completion of the tender offer, Integra expects to consummate a second-step merger at the same per-share price paid in the tender offer for shares not purchased in the tender offer.

D.F. King & Co., Inc. is acting as information agent and Broadridge Corporate Issuer Solutions, Inc. is acting as depositary and paying agent in the tender offer. Requests for documents and questions regarding the tender offer may be directed to information agent by telephone at (800) 290-6424.

Varian Medical Systems Reports Results for First Quarter of Fiscal Year 2017

On January 25, 2017 Varian Medical Systems (NYSE:VAR) reported GAAP net earnings of $0.22 per diluted share and non-GAAP net earnings of $0.75 per diluted share for the first quarter of fiscal year 2017, including $76 million in charges almost exclusively relating to a proton facility owned by California Proton Treatment Center, LLC (CPTC) in San Diego (Press release, Varian Medical Systems, JAN 25, 2017, View Source [SID1234517559]). These charges and the associated limited tax deductibility reduced Varian earnings in the first quarter of fiscal 2017 by $0.64 per diluted share on a GAAP basis or $0.34 per diluted share on a non-GAAP basis.

Varian’s first quarter revenues totaled $763 million, up 1 percent from the year-ago quarter in dollars and constant currency. The company ended the quarter with a $3.4 billion backlog, up 2 percent from the end of the first quarter of fiscal year 2016.

"Varian generated strong global order growth and margin gains in our oncology business as well as sales momentum in the imaging components business while recording an impairment of CPTC’s indebtedness to Varian," said Dow Wilson, CEO of Varian Medical Systems. "We remain on track with our previously announced plans to separate and establish the imaging components business as a new public company, Varex Imaging, at the end of this month."

Varian took a $76 million charge in the first quarter in response to certain actions in January by CPTC and its loan agent, ORIX Capital Markets, to address liquidity issues caused by lower than expected patient volumes that are insufficient to support CPTC’s capital structure. This led Varian to reserve $38 million in accounts receivable and to impair $38 million of its $98 million loan to CPTC, of which $29 million was accrued interest. The company is reporting additional information on this matter today in a Form 8-K filing with the Securities and Exchange Commission.

"We believe this center can get on a more solid financial footing by serving a broader patient population with additional healthcare providers locally and regionally," Wilson said. "We remain confident and committed to supporting all of our customers and to building a profitable proton business based on leading technology that is treating patients and performing at a high level. We are continuing to make good progress on 13 other installations and the sales funnel continues to look promising." The company’s Particle Therapy business, recorded first quarter revenues of $30 million.

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Varian finished its first quarter of fiscal year 2017 with $815 million in cash and cash equivalents and $607 million of debt. Cash flow from operations was $82 million for the first quarter. During the quarter, the company spent $49 million to repurchase 500,000 shares of common stock.

Oncology Systems
Oncology Systems’ first quarter revenues totaled $581 million, down from the year-ago quarter by 1 percent in dollars and by 2 percent in constant currency. First-quarter Oncology gross orders were $586 million, up from the year-ago quarter by 10 percent in dollars and constant currency. In the Americas, Oncology gross orders increased by 5 percent in dollars and in constant currency, including 7 percent growth in North America. In EMEA, gross orders were up 8 percent in dollars and up 10 percent in constant currency. In APAC, gross orders rose 29 percent in dollars and by 24 percent in constant currency.

"Broad-based demand for new equipment as well as software and services drove the strong gross order growth in our Oncology business during the quarter," Wilson said. "Revenues declined versus a strong year-ago quarter due primarily to the timing of deliveries, but this business did a spectacular job of improving margins with the help of product mix, stable pricing and product cost reductions."

Imaging Components
First quarter revenues from Varian’s Imaging Components business were $152 million, up 7 percent from the year-ago period, and first quarter gross orders for this business were $132 million, up 4 percent from the year-ago period.

"Revenues from Imaging Components rose with gains in both the medical and industrial segments," said Varian Imaging Components President Sunny Sanyal, who will become CEO of Varex Imaging. "With our first quarter performance as well as our previously announced plan to acquire the Medical Imaging business of PerkinElmer this fiscal year, our business is on track to separate from Varian with solid momentum in orders and sales."

Varian Outlook
"Beginning with our fiscal second quarter, Imaging Components will be reflected as a discontinued operation for the first four months of fiscal year 2017," said Wilson. "The company is guiding for continuing operations for the second through the fourth quarters of the fiscal year 2017. For the balance of fiscal year 2017, we believe Varian revenues from continuing operations will grow in the range of 4 to 5 percent, bringing revenue growth for the year to 3 to 4 percent. Non-GAAP earnings per diluted share from continuing operations for the second through fourth quarters of the fiscal year will be in the range of $2.94 to $3.06."

"For the second quarter, we believe Varian revenues from continuing operations will grow in the range of 4 to 5 percent and non-GAAP earnings per diluted share will be in the range of $0.84 to $0.90," Wilson added. The company intends to repurchase 2 million shares of stock in its second quarter of fiscal year 2017. Varian will publish a historical annual breakdown of continuing and discontinued operations for fiscal years 2014-2016 on our website filing shortly following the separation. Separately, the company will make available quarterly pre-tax results for fiscal year 2016.

Please refer to "Discussion of Non-GAAP Financial Measures" below for a description of items excluded from expected non-GAAP earnings.

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Varian Medical Systems Reports Results for First Quarter of Fiscal Year 2017

New Published Research Reveals that Cervical Cancer Mortality Rates May Be Significantly Higher in the United States than Previously Reported

On January 25, 2017 Advaxis, Inc. (NASDAQ:ADXS), a clinical-stage biotechnology company developing cancer immunotherapies, reported research published in the journal Cancer which underscores the need for more access to screenings, improved clinical care and new therapeutic options for all women with cervical cancer (Press release, Advaxis, JAN 25, 2017, View Source [SID1234517558]).

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These important research findings were covered by leading news outlets including The New York Times and CNN, as these data indicate that mortality rates of this deadly form of cancer are significantly higher in the United States than previously reported due to the inclusion of women who have had hysterectomies, highlighting racial and socioeconomic disparities. According to the research, the data revealed a U.S. cervical cancer mortality rate among women without hysterectomies of 10.1 per 100,000 black women and 4.7 per 100,000 white women, up from mortality rates of 5.7 and 3.2, respectively, which were previously reported in research among all women, including those who have had hysterectomies.

The publication of these data coincides with Cervical Health Awareness Month, a national effort designed to promote the need for cervical health education and screenings, which can lead to early detection of cervical cancer when therapies may be most effective.

Advaxis is the only biopharmaceutical company sponsoring global, phase 3 clinical research for advance stage cervical cancer. Last year, the company initiated its Phase 3 AIM2CERV (Advaxis IMmunotherapy 2 prevent CERVical recurrence) trial in high-risk, locally advanced cervical cancer (HRLACC). The company also announced positive, top-line data from the GOG-0265 Phase 2 trial that supports pursuing a global phase 3 study in metastatic recurrent cervical cancer.

"This research highlights disparities in outcomes in the cervical cancer community and underscores the need to work together with policy-makers, providers, academic institutions and the biopharmaceutical industry to raise awareness among minority groups about current treatment options and bring new treatment options forward," said Tamika Felder, Founder of Cervivor. "In doing so, hopefully we can close this gap."

Invasive cervical cancer occurs in women who have been infected by the human papillomavirus (HPV) and is the most common HPV-associated cancer in women. According to the American Cancer Society, approximately 12,000 women in the United States will be diagnosed with cervical cancer in 2017. While vaccines to prevent HPV infection may help prevent cervical cancer if given before exposure, only one-third of the U.S. population has been vaccinated against the virus and the vaccination rate is lower worldwide, which is the main cause of the nearly 500,000 new cases diagnosed each year. Cervical cancer largely affects women who have not received preventative vaccines or regular screenings.

Biota Pharmaceuticals, Inc. Announces Name Change to Aviragen Therapeutics, Inc. (NASDAQ: AVIR)

On April 12, 2016 Biota Pharmaceuticals, Inc. (NASDAQ:BOTA) reported that the Company has changed its name to Aviragen Therapeutics, Inc., ("Aviragen Therapeutics"), a pharmaceutical company focused on the development of the next generation of direct-acting antivirals that address infections that have limited therapeutic options (Press release, Aviragen Therapeutics, JAN 25, 2017, View Source [SID1234517553]).

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"A meaningful transformation has taken place over the last two years as we transitioned from a drug discovery and early-stage licensing organization to one focused on drug development and progressing key late-stage product candidates in important viral diseases. Our name change reflects this transition and better defines our strategic initiatives moving forward," said Joseph Patti, PhD, President and Chief Executive Officer of Aviragen Therapeutics. "Specifically, our recent initiation of a Phase 2a efficacy study of BTA585 for the treatment of RSV infections highlights our focus on bringing new medicines to treat and prevent viral infections with limited therapeutics options. As Aviragen Therapeutics, we will continue to advance and expand our promising pipeline of anti-viral drugs."

The name change become effective on April 11, 2016 and the Company’s common stock will begin trading on the NASDAQ Stock Exchange under the new ticker symbol "AVIR" on April 13, 2016.

Johnson & Johnson To Acquire Actelion For $30 Billion With Spin-Out Of New R&D Company

On January 26, 2017 Johnson & Johnson (NYSE:JNJ) and Actelion Ltd. (SIX:ATLN) reported that they have entered into a definitive transaction agreement under which Johnson & Johnson will launch an all-cash tender offer in Switzerland to acquire all of the outstanding shares of Actelion for $280 per share, payable in U.S. dollars, which equates to CHF 280.08 per share as of January 25, 2017 (Press release, Johnson & Johnson, JAN 25, 2017, View Source [SID1234517581]). The transaction, which was unanimously approved by the Boards of Directors of both companies, is expected to be immediately accretive to Johnson & Johnson adjusted earnings per share and accelerate Johnson & Johnson revenue and earnings growth rates. Johnson & Johnson will fund the transaction with cash held outside the United States.

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Actelion has established a leading franchise of differentiated, innovative products for pulmonary arterial hypertension (PAH) that is highly complementary to the existing portfolio of the Janssen Pharmaceutical Companies of Johnson & Johnson. The addition of Actelion’s specialty in-market medicines and late-stage products is consistent with Johnson & Johnson’s efforts to grow in attractive and complementary therapeutic areas and serve patients with serious illnesses and significant unmet medical need. In addition, the transaction structure will provide Johnson & Johnson flexibility to accelerate investment in its industry-leading, innovative pipeline to drive additional growth. Further, Johnson & Johnson expects to retain Actelion’s presence in Switzerland and also leverage its complementary capabilities in shaping medical paradigms.

As part of the transaction, immediately prior to the completion of the acquisition, Actelion will spin out its drug discovery operations and early-stage clinical development assets into a newly created Swiss biopharmaceutical company (“R&D NewCo”). The shares of R&D NewCo, which will be listed on the SIX Swiss Exchange (SIX), will be distributed to Actelion’s shareholders as a stock dividend upon closing of the tender. Johnson & Johnson will initially hold 16% of the shares of R&D NewCo and have rights to an additional 16% of R&D NewCo equity through a convertible note. Johnson & Johnson will also receive an option on ACT-132577, a product within R&D NewCo being developed for resistant hypertension currently in phase 2 clinical development. Together, these arrangements with R&D NewCo will provide Johnson & Johnson with additional sources of innovation and value. R&D NewCo will be led by Actelion’s current scientific team with Jean-Paul Clozel, MD, Chief Executive Officer and founding member of Actelion, as Chief Executive Officer. Jean Pierre Garnier, Chairman of the Board of Actelion, will be Chairman of the Board of R&D NewCo.

“We believe this transaction offers compelling value to both Johnson & Johnson and Actelion shareholders,” said Alex Gorsky, Chairman and Chief Executive Officer of Johnson & Johnson. “Actelion has built an attractive, growing business with world-class commercial and clinical development capabilities. Adding Actelion’s portfolio to our already strong Janssen Pharmaceuticals business is a unique opportunity for us to expand our portfolio with leading, differentiated in-market medicines and promising late-stage products. We expect to leverage our established global presence and commercial strength to accelerate growth and patient access to these important therapies. Further, we believe R&D NewCo will be strongly positioned to continue Actelion’s legacy of innovation and look forward to collaborating on the development of cutting-edge new therapies.”

Mr. Garnier said, “I’m very proud that we have created such a unique value proposition through this structured transaction. Actelion’s shareholders can monetize their holdings in Actelion at a highly attractive cash price of $280 per share, while at the same time retaining a significant stake in the future potential upside of Actelion’s earlier stage pipeline, through their ownership of R&D NewCo. Jean-Paul Clozel and I have high expectations for this new, well-funded biotech company with a significant portfolio of drugs in the clinic. R&D NewCo will be led by an experienced and proven scientific team.”

Dr. Clozel said, “In making this offer, Johnson & Johnson is recognizing all that has been created at Actelion during the last 20 years, and in particular the quality of our PAH franchise, the potential of our key marketed medicines and our promising late-stage development assets. The newly created R&D company allows us to continue with our successful culture of innovation. It is enormously exciting to continue to develop new and differentiated products, in multiple therapeutic areas, to improve the lives of patients.”

Benefits of the Transaction

Compelling, all-cash transaction for Actelion shareholders: The transaction will deliver a significant and immediate premium to Actelion shareholders, with greater value certainty as compared to Actelion’s standalone prospects. Actelion shareholders are also expected to realize substantial additional value from their ownership interest in R&D NewCo.

Value-enhancing transaction for Johnson & Johnson shareholders: The transaction is expected to be immediately accretive to Johnson & Johnson earnings per share and accelerate Johnson & Johnson revenue and earnings growth rates, while enhancing long-term growth and value creation of the Janssen Pharmaceuticals business. Post-transaction close, Johnson & Johnson expects the transaction to increase its long-term revenue growth rate by at least 1.0% and its long-term earnings growth rate by 1.5% – 2.0% above current analyst consensus. Johnson & Johnson estimates EPS accretion in the first full year of $0.35 to $0.40. Johnson & Johnson shareholders are also expected to realize additional value from the Johnson & Johnson ownership interest in R&D NewCo.

Additional value creation through new R&D NewCo: R&D NewCo will inherit Actelion’s fully established and validated drug discovery engine based in Allschwil, Switzerland and its proven and experienced discovery and development team. It will be well positioned to continue Actelion’s strong legacy of innovation to discover and develop new and differentiated products in multiple therapeutic areas. As an independent clinical stage biopharmaceutical company, specializing in the discovery and development of small molecule therapeutics to meet significant unmet medical need, R&D NewCo will have a broad portfolio of drug candidates in clinical development, across four focused therapeutic franchises: specialty cardiovascular disorders, central nervous system disorders, immunological disorders and orphan diseases.

Aligns with Janssen Pharmaceuticals’ Transformational Medical Innovation Strategy: Actelion’s PAH franchise, including differentiated, innovative medicines Opsumit, Uptravi, Tracleer, Veletri and Ventavis, expands Janssen Pharmaceuticals’ portfolio in its attractive and complementary cardiovascular and metabolic therapeutic area, and provides a leading commercial position in an established area where the science is transformational for patients. Through the proposed transaction, Johnson & Johnson will also acquire Actelion’s other marketed products, including Valchlor and Zavescaas well as global rights to ponesimod, an S1P1 receptor modulator in phase 3 development for multiple sclerosis, and cadazolid, a novel antibiotic in phase 3 development for Clostridium difficile-associated diarrhea.

Extends Actelion products’ geographic and commercial reach: The Johnson & Johnson global presence and commercial capabilities will help open new markets and opportunities for Actelion’s in-market products