On August 8, 2017 Verastem, Inc. (NASDAQ: VSTM), focused on discovering and developing drugs to improve the survival and quality of life of cancer patients, reported financial results for the second quarter ended June 30, 2017 and provided an overview of certain corporate developments (Press release, Verastem, AUG 8, 2017, View Source;p=RssLanding&cat=news&id=2292669 [SID1234520207]).

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"The second quarter of 2017 was marked by several duvelisib data presentations at top hematology-focused medical meetings," said Robert Forrester, President and Chief Executive Officer of Verastem. "Long-term follow-up data from the Phase 2 DYNAMO study, which was presented at the 14th International Conference on Malignant Lymphoma (ICML), demonstrated a durable 47% response rate and a well characterized and manageable safety profile in patients with indolent non-Hodgkin Lymphoma (iNHL) whose disease is refractory to both rituximab and chemotherapy or radioimmunotherapy. These overall DYNAMO results were followed by promising subgroup data for DYNAMO patients with follicular lymphoma (FL) or small lymphocytic lymphoma (SLL), presented at the 22nd Congress of the European Hematology Association (EHA) (Free EHA Whitepaper), which described high response rates of 43% and 68% in FL and SLL, respectively. We remain highly encouraged by the data generated to date from the duvelisib program and we look forward to reporting top-line data from the Phase 3 DUO study in relapsed/refractory chronic lymphocytic leukemia and small lymphocytic lymphoma (CLL/SLL) currently expected in the latter part of summer 2017."

Second Quarter 2017 and Recent Highlights:
Duvelisib
Ongoing Phase 3 DUO Study in Relapsed or Refractory CLL/SLL – The efficacy and safety of duvelisib is currently being evaluated in the randomized Phase 3 DUO study in patients with relapsed or refractory CLL/SLL. In the DUO study, approximately 300 patients were randomized 1:1 to receive duvelisib or ofatumumab. The trial was fully enrolled in November 2015. The primary endpoint of this study is progression free survival (PFS). Key secondary endpoints include overall response rate (ORR), overall survival (OS), duration of response (DOR) and safety. Verastem expects to report top-line data from the DUO study in the latter part of summer 2017.

Presented Long-Term Follow Up Data in Patients with Double-Refractory FL and SLL at EHA (Free EHA Whitepaper) 2017 – Long-term follow up data from the subsets of patients with FL or SLL who were enrolled in the ongoing Phase 2 DYNAMO study were the subject of presentations at EHA (Free EHA Whitepaper) 2017 in Madrid, Spain. In an oral presentation, titled "DYNAMO: A Phase 2 Study Demonstrating the Clinical Activity of Duvelisib in Patients with Double-Refractory Follicular Lymphoma," Pier Luigi Zinzani, M.D., Ph.D., of the University of Bologna Institute of Hematology, reported that duvelisib monotherapy demonstrated an ORR of 43%, as determined by an independent review committee, with 83% of patients experiencing a reduction in the size of target lymph nodes. The median DOR was 7.9 months, the median PFS was 8.3 months, and the median overall survival (OS) was 27.8 months. In an e-poster presentation, titled "DYNAMO: The Clinical Activity of Duvelisib in Patients with Double-Refractory Small Lymphocytic Lymphoma in a Phase 2 Study," Dr. Zinzani reported that duvelisib as a monotherapy demonstrated an ORR of 68%, as determined by an independent review committee, with 100% of patients experiencing a reduction in the size of target lymph nodes.

With a median time on duvelisib of 12 months, median DOR was 10.1 months, median PFS was 11.7 months, and median OS was 28.9 months. The safety profile of duvelisib monotherapy remained consistent with what has been previously reported in iNHL and other hematologic malignancies. Copies of Dr. Zinzani’s oral and e-poster presentations are available here and here.

Presented Long-Term Follow Up Data from the Phase 2 DYNAMO Study at ICML 2017 – Long-term follow up data from the ongoing Phase 2 DYNAMO study was highlighted in an oral presentation at ICML 2017 in Lugano, Switzerland. In the presentation, titled "DYNAMO: A Phase 2 Study Demonstrating the Clinical Activity of Duvelisib in Patients with Double-Refractory Indolent Non-Hodgkin Lymphoma," Dr. Zinzani, reported that duvelisib as a monotherapy demonstrated an ORR of 47%, as determined by an independent review committee, with 88% of patients experiencing a reduction in the size of target lymph nodes. Overall, the median DOR was 10 months, the median PFS was 9 months, and the median overall survival was 27.8 months. With additional follow-up (median 18 months), the safety profile of duvelisib monotherapy remained consistent with what has been previously reported in iNHL and other hematologic malignancies. The DYNAMO study met its primary ORR endpoint (p=0.0001) at the primary analysis. A PDF of Dr. Zinzani’s oral presentation is available here.

Defactinib (VS-6063)
Published Scientific Data Highlighting Potential Role of Focal Adhesion Kinase (FAK) Inhibition in Pancreatic and Breast Cancer – In July 2017, Verastem announced the publication of two papers in the peer-reviewed journals, PLoS One and Oncotarget. The two published articles reported scientific findings from studies evaluating FAK inhibition in preclinical models of pancreatic and breast cancer and continue to validate the underlying thesis for ongoing clinical collaborations evaluating Verastem’s lead FAK inhibitor defactinib in combination with chemotherapeutic and leading immunotherapeutic agents in several difficult to treat types of cancer. The PLoS One paper in pancreatic cancer is available here and the Oncotarget paper in breast cancer is available here.

Presented Preclinical Data at the 2017 American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting – In an oral presentation titled, "Reprogramming the tumor microenvironment to improve responses to therapy," Verastem scientific collaborator David G. DeNardo, Ph.D., Associate Professor of Medicine, Division of Oncology, Department of Immunology, Washington University School of Medicine in St. Louis, described data demonstrating that FAK inhibition can enable efficacy of PD-1 inhibition in preclinical models of pancreatic cancer that, like the clinical disease, are otherwise refractory to checkpoint inhibition. Verastem’s FAK inhibitor, defactinib, is currently being evaluated in combination with Merck’s PD-1 inhibitor, pembrolizumab, and gemcitabine in patients with advanced pancreatic ductal adenocarcinoma (PDAC). Initial analysis of immune biomarkers from matched pairs of metastatic biopsies, taken either pre- or post-treatment, from patients with PDAC showed an increase in activated proliferating cytotoxic T cells together with a reduction in tumor-associated macrophages (TAMs). A PDF copy of Dr. DeNardo’s oral presentation is available here.

Corporate and Financial
Julie B. Feder Appointed Chief Financial Officer – In July 2017, Verastem announced the appointment of Ms. Feder as its Chief Financial Officer. Ms. Feder is an accomplished financial professional with invaluable leadership experience in the healthcare industry. She joins Verastem from the Clinton Health Access Initiative, Inc. (CHAI), where she served as Chief Financial Officer. Prior to joining CHAI, Ms. Feder held finance roles of increasing responsibility at Genzyme Corporation including leading the internal audit process. Ms. Feder began her career at Deloitte & Touche LLP and she holds a Bachelor of Science in Accounting from Yeshiva University’s Sy Syms School of Business.

Eric K. Rowinsky, M.D. Appointed to the Board of Directors – Verastem announced the appointment of Eric K. Rowinsky, M.D., to its Board of Directors. Dr. Rowinsky brings to Verastem nearly 30 years of experience in the development of cancer treatments, such as cetuximab (Erbitux) when he was Chief Medical Officer of ImClone Systems, as well as Cyramza, Portrazza, Taxol, Taxotere, Hycamtin, Tarceva, Camptosar, Tykerb, and cixutumumab, among others. He is a member of the board of directors of Biogen, Navidea, and Fortress Biotech, all public life sciences companies, and has served on the board of directors of BIND Therapeutics, a life-science company acquired by Pfizer. Dr. Rowinsky replaced Paul A. Friedman, M.D. who transitioned from his role as Director to become a member of Verastem’s Clinical and Scientific Advisory Board.

Second Quarter 2017 Financial Results
Net loss for the three months ended June 30, 2017 (2017 Quarter) was $13.4 million, or $0.36 per share, as compared to a net loss of $8.6 million, or $0.23 per share, for the three months ended June 30, 2016 (2016 Quarter). Net loss includes non-cash stock-based compensation expense of $1.2 million and $1.7 million for the 2017 Quarter and 2016 Quarter, respectively. Verastem used $14.5 million for operating activities during the 2017 Quarter.

Research and development expense for the 2017 Quarter was $9.0 million compared to $4.5 million for the 2016 Quarter. The $4.5 million increase from the 2016 Quarter to the 2017 Quarter was primarily related to an increase of $3.6 million in contract research organization expense for outsourced biology, development and clinical services, which includes our clinical trial costs, an increase of approximately $894,000 in consulting fees, and an increase in personnel related costs of approximately $244,000. These increases were offset by a decrease in stock-based compensation and other expenses of approximately $176,000.

General and administrative expense for the 2017 Quarter was $4.4 million compared to $4.2 million for the 2016 Quarter. The increase of approximately $208,000 from the 2016 Quarter to the 2017 Quarter primarily resulted from an increase in consulting and professional fees of approximately $870,000, partially offset by decreases in stock-based compensation expense of approximately $534,000 and personnel costs of approximately $152,000.
As of June 30, 2017, Verastem had cash, cash equivalents and investments of $57.9 million compared to $80.9
million as of December 31, 2016.

The number of outstanding common shares as of June 30, 2017, was 36,992,418.

Financial Guidance
Based on our current operating plans, we expect to have sufficient cash, cash equivalents and investments to fund our research and development programs and operations into 2018.

About the Tumor Microenvironment
The tumor microenvironment encompasses various cellular populations and extracellular matrices within the tumor or cancer niche that support cancer cell survival. This includes immunosuppressive cell populations such as regulatory T-cells, myeloid-derived suppressor cells, M2 TAMS, as well as tumor-associated fibroblasts and extracellular matrix proteins which can hamper the entry and therapeutic benefit of cytotoxic immune cells and anti-cancer drugs. In addition to targeting the proliferative and survival signaling of cancer cells, Verastem’s compounds duvelisib and defactinib target the tumor microenvironment as a mechanism of action to potentially improve a patient’s response to therapy.

About Duvelisib
Duvelisib is an investigational, dual inhibitor of phosphoinositide 3-kinase (PI3K)-delta and PI3K-gamma, two enzymes that are known to help support the growth and survival of malignant B-cells and T-cells. PI3K signaling may lead to the proliferation of malignant B-cells and is thought to play a role in the formation and maintenance of the supportive tumor microenvironment.1,2,3 Duvelisib is currently being evaluated in late- and mid-stage clinical trials, including DUO, a randomized, Phase 3 monotherapy study in patients with relapsed/refractory CLL/SLL,4 and DYNAMO, a single-arm, Phase 2 monotherapy study in patients with refractory iNHL that achieved its primary endpoint of ORR upon topline analysis of efficacy data.5 Duvelisib is also being evaluated for the treatment of hematologic malignancies through investigator-sponsored studies, including T-cell lymphoma.6 Information about duvelisib clinical trials can be found on www.clinicaltrials.gov.

About Defactinib
Defactinib (VS-6063) is an investigational inhibitor of FAK, a non-receptor tyrosine kinase that mediates oncogenic signaling in response to cellular adhesion and growth factors.7 Based on the multi-faceted roles of FAK, defactinib is used to treat cancer through modulation of the tumor microenvironment, enhancement of anti-tumor immunity, and reduction of cancer stem cells.8,9 Defactinib is currently being evaluated in three separate clinical collaborations in combination with immunotherapeutic agents for the treatment of several different cancer types including pancreatic, ovarian, non-small cell lung cancer, and mesothelioma. These studies are combination clinical trials with pembrolizumab and avelumab from Merck & Co. and Pfizer/Merck KGaA, respectively.10,11,12 Information about these and additional clinical trials evaluating the safety and efficacy of defactinib can be found on www.clinicaltrials.gov.

On August 8, 2017 TESARO, Inc. (NASDAQ:TSRO), an oncology-focused biopharmaceutical company, reported operating results for second-quarter 2017 and provided an update on the Company’s commercial products and development programs (Press release, TESARO, AUG 8, 2017, View Source [SID1234520203]).

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"The U.S. launch of ZEJULA, the first and only PARP inhibitor to be approved for the maintenance treatment of women with recurrent ovarian cancer, regardless of BRCA mutation or biomarker status, is off to an excellent start, and we are gratified by the positive feedback that we have received from patients and prescribers," said Lonnie Moulder, CEO of TESARO. "Following its introduction in late April, ZEJULA quickly became the most frequently prescribed PARP inhibitor in the U.S. The MAA for ZEJULA is under review in Europe, and we are pleased that interest in our expanded access program (EAP) has been high, as we anticipate the European launch of ZEJULA by year end. We continue to globalize our mission with the recently announced Takeda licensing agreement for ZEJULA in Japan, and the launches of VARUBY oral in several EU countries. We are advancing the registration program for TSR-042, our anti-PD-1 antibody, and have initiated a combination clinical study of our anti-TIM-3 antibody, TSR-022, plus TSR-042. We are also pleased with the progress of our earlier stage immuno-oncology antibody and small molecule programs and the potential for this pipeline to establish TESARO as a leading player in the field."

Recent Business Highlights

TESARO launched ZEJULA in the U.S. in April 2017, following U.S. Food and Drug Administration (FDA) approval for the maintenance treatment of adult patients with recurrent epithelial ovarian, fallopian tube, or primary peritoneal cancer who are in a complete or partial response (CR or PR) to platinum-based chemotherapy. ZEJULA is the most prescribed PARP inhibitor in the U.S., with more than 1,500 new patients treated in the second quarter and prescriptions written by over 1,000 physicians since launch.
Pre-launch preparations continue in support of a European launch of ZEJULA by year-end 2017, pending European Commission approval, and the niraparib expanded access program (EAP) has enrolled more than 200 patients across nine European countries.
VARUBY (oral formulation) was approved by the European Commission in April and has been launched in Germany, the U.K., Denmark, Finland and Austria. Preparations are ongoing in support of launches in additional European countries.
VARUBI (oral formulation) was the most prescribed oral NK-1 receptor antagonist in the U.S. for the second quarter of 2017. The NDA re-submission for the intravenous (IV) formulation of rolapitant is under review by the FDA, with a Prescription Drug User Fee Act (PDUFA) action date of October 25, 2017.
Enrollment continues in the PRIMA trial of niraparib for patients with first-line ovarian cancer and the QUADRA trial of niraparib for the treatment of patients with ovarian cancer who have received three or more prior lines of chemotherapy.
In July, TESARO and Takeda Pharmaceutical Company Limited announced an exclusive licensing agreement for the commercialization and clinical development of niraparib in Japan and certain other countries.
Enrollment continues in the TOPACIO trial of niraparib plus KEYTRUDA (pembrolizumab) in patients with platinum resistant ovarian cancer or with triple negative breast cancer, and in the AVANOVA trial of niraparib plus bevacizumab in patients with recurrent ovarian cancer. Data from the TOPACIO and AVANOVA trials are expected to be presented during the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) Congress in September.
The registration strategy for TSR-042 (anti-PD-1) has been finalized with the FDA for patients with metastatic microsatellite instability-high (MSI-H) cancers. Additional data from the Phase 1 study of TSR-042 are planned for presentation during ESMO (Free ESMO Whitepaper).
Dose-escalation of TSR-022 (anti-TIM-3) as a monotherapy is complete and a combination study of TSR-022 with TSR-042 is ongoing.
In August, the Phase 1 dose-escalation trial for TSR-033 (anti-LAG-3) was initiated.
IND-enabling studies are underway for bi-specific antibody candidate targeting PD-1/LAG-3.
Second Quarter 2017 Financial Results

TESARO reported net product revenue of $28.8 million for the second quarter of 2017, which included ZEJULA sales of $25.9 million and VARUBI/VARUBY sales of $2.9 million. This compares to net product revenue of $1.2 million for the second quarter of 2016.

Cost of sales totaled $6.6 million for the second quarter of 2017 and included $3.6 million associated with product revenue for the second quarter of 2017 and $3.0 million related to amortization of milestones recorded upon FDA approval of niraparib and first commercial sales of VARUBI/VARUBY in the U.S. and Europe. Cost of sales totaled $0.7 million for the second quarter of 2016.

Research and development expenses increased to $71.4 million for the second quarter of 2017, compared to $50.1 million for the second quarter of 2016, driven primarily by increased headcount, expansion of the TSR-042 and TSR-022 programs, and advancement of our earlier-stage immuno-oncology portfolio.

Selling, general and administrative expenses increased to $93.0 million for the second quarter of 2017, compared to $36.2 million for the second quarter of 2016, primarily due to activities in support of the launches of ZEJULA and VARUBI/VARUBY in the U.S. and Europe, increased headcount, and higher professional service fees.

Acquired in-process research and development expenses totaled $7.0 million for the second quarter of 2017 and included milestone payments related to our immuno-oncology portfolio, compared to $4.0 million for the second quarter of 2016, which also related to a development milestone achieved within our immuno-oncology programs.

Operating expenses as described above include total non-cash, stock-based compensation expense of $23.5 million for the second quarter of 2017, compared to $11.7 million for the second quarter of 2016.

Net loss totaled $152.1 million, or ($2.82) per share, for the second quarter of 2017, compared to a net loss of $59.2 million, or ($1.29) per share, for the second quarter of 2016.

As of June 30, 2017, TESARO had approximately $508 million in cash and cash equivalents and approximately 54.2 million outstanding shares of common stock. This cash and cash equivalents balance does not include the $100 million up-front payment received during the third quarter as part of the Takeda license agreement.

Corporate Objectives

TESARO anticipates achieving the following key objectives:

VARUBI / VARUBY (rolapitant):

Launch VARUBI IV in the U.S. in Q4 2017, pending FDA approval; and
Continue to execute on the VARUBY oral launch in Europe.
ZEJULA (niraparib):

Continue to execute on the ongoing U.S. launch of ZEJULA and solidify its position as the market leading PARP inhibitor for patients with recurrent ovarian cancer;
Launch ZEJULA in Europe by year-end 2017, pending European Commission approval;
Continue to enroll the Phase 3 PRIMA trial throughout 2017; and
Begin to initiate expanded ovarian, breast and lung cancer development programs in 2017.
Immuno-Oncology Portfolio:

Continue to enroll patients with MSI-H cancer in the registration trial of TSR-042, with the intent of supporting accelerated FDA approval;
Continue enrollment in the TSR-022 plus TSR-042 combination cohort through 2017;
Continue to enroll the Phase 1 trial of TSR-033;
Advance IND-enabling studies for bi-specific antibody lead clinical candidate targeting PD-1/LAG-3, in 2H 2017; and
Identify the first clinical candidate within the MD Anderson collaboration in Q3 2017.

About ZEJULA (Niraparib)
ZEJULA (niraparib) is a poly (ADP-ribose) polymerase (PARP) inhibitor indicated for the maintenance treatment of adult patients with recurrent epithelial ovarian, fallopian tube, or primary peritoneal cancer who are in a complete or partial response to platinum-based chemotherapy. In preclinical studies, ZEJULA concentrates in the tumor relative to plasma, delivering greater than 90% durable inhibition of PARP 1/2 and a persistent antitumor effect. Myelodysplastic Syndrome/Acute Myeloid Leukemia (MDS/AML), including some fatal cases, was reported in patients treated with ZEJULA. Discontinue ZEJULA if MDS/AML is confirmed. Hematologic adverse reactions (thrombocytopenia, anemia and neutropenia), as well as cardiovascular effects (hypertension and hypertensive crisis) have been reported in patients treated with ZEJULA. Monitor complete blood counts to detect hematologic adverse reactions, as well as to detect cardiovascular disorders, during treatment. ZEJULA can cause fetal harm and females of reproductive potential should use effective contraception. Please see full prescribing information, including additional important safety information, available at www.zejula.com.

On August 8, 2017 Stemline Therapeutics, Inc. (Nasdaq: STML), a clinical-stage biopharmaceutical company developing novel therapeutics for difficult to treat cancers, reported financial results for the quarter ended June 30, 2017 (Filing, Q2, Stemline Therapeutics, 2017, AUG 8, 2017, View Source [SID1234520201]). The Company also reviewed recent clinical and regulatory events, and outlined key upcoming milestones:

SL-401 In Blastic Plasmacytoid Dendritic Cell Neoplasm (BPDCN)

· The SL-401 pivotal Phase 2 trial enrolled 45 BPDCN patients in Stages 1, 2 and 3. Stage 3 was prospectively designed to support potential registration.

· During the quarter, we presented updated data from Stages 1 and 2 of the Phase 2 trial at the 22nd Congress of the European Hematology Association (EHA) (Free EHA Whitepaper) in Madrid, Spain.

· Analysis of Phase 2 data, inclusive of Stage 3, is ongoing and we remain on track to announce top-line results in 2H17. We are also targeting a medical conference to present more detailed results later this year.

· To ensure ongoing patient access to SL-401, we are enrolling both first-line and relapsed/refractory BPDCN patients in an additional cohort.

· Depending on the data from the trial, we plan to use the results generated, along with other relevant data, to support the filing of a Biologics License Application (BLA) for approval in BPDCN. We continue to anticipate a possible BLA filing could begin in 4Q17 or 1Q18.

Additional Clinical Trials

· Clinical trials evaluating SL-401 are ongoing in additional indications including certain myeloproliferative neoplasms (MPN), acute myeloid leukemia (AML), and multiple myeloma, as a single agent or in combination with other agents. We expect to provide updates on these studies later this year and into next year.

· SL-801, a novel XPO1 inhibitor, is being evaluated in a Phase 1 trial of patients with advanced solid tumors. SL-701 has completed dosing in a Phase 2 trial of patients with second-line glioblastoma. We are targeting medical conferences for updates on both of these studies later this year.

Second Quarter 2017 Financial Results Review

Stemline ended the second quarter of 2017 with $93.2 million in cash, cash equivalents and investments, as compared to $105.8 million as of March 31, 2017, which reflects a use of cash of $12.6 million for the quarter. The company ended the second quarter of 2017 with 25.2 million shares outstanding.

For the second quarter of 2017, Stemline had a net loss of $15.5 million, or $0.66 per share, compared with a net loss of $9.3 million, or $0.52 per share, for the same period in 2016.

Research and development expenses were $11.5 million for the second quarter of 2017, which reflects an increase of $4.6 million, or 67%, compared with $6.9 million for the second quarter of 2016. The higher costs are primarily driven by an increase of $2.1 million in manufacturing expenses to support our potential BLA filing for SL-401. We also incurred $1.2 million in higher costs for regulatory support of our potential BLA filing for SL-401. Additionally, we incurred higher compensation expense as a result of increased headcount.

General and administrative expenses were $4.5 million for the second quarter of 2017, which reflects an increase of $1.6 million, or 57%, compared with $2.9 million for the second quarter of 2016. The increase in expense was primarily attributable to $0.7 million in pre-launch expenses in support of a potential commercialization of SL-401 in BPDCN, if marketing approval from the FDA is granted. The increase in costs was also driven by $0.4 million in higher legal expense as a result of the class action lawsuit, as well as a $0.3 million increase in non-cash stock-based compensation expense.

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On August 8, 2017 Nektar Therapeutics (Nasdaq: NKTR) reported its financial results for the second quarter ended June 30, 2017 (Press release, Nektar Therapeutics, AUG 8, 2017, View Source [SID1234520199]).

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Cash and investments in marketable securities at June 30, 2017 were $310.7 million as compared to $389.1 million at December 31, 2016. The cash balance does not include the $150 million upfront payment expected from Nektar’s recently announced collaboration with Eli Lilly & Company for the development and commercialization of NKTR-358.

"Nektar has successfully achieved a number of important milestones in 2017," said Howard W. Robin, President and CEO of Nektar. "In July, we announced positive results from the human abuse potential study of NKTR-181, which followed the positive Phase 3 efficacy data earlier in the year. The body of data for NKTR-181 shows that it could be a transformational pain medicine for the treatment of chronic pain and be a key building block in the nation’s fight against the opioid abuse epidemic. Our new collaboration with Lilly for NKTR-358 enables the broad development of this first-in-class resolution therapeutic in multiple autoimmune conditions. Finally, in immuno-oncology, we are pleased to announce that we began dosing patients in the expansion stage of the PIVOT study of NKTR-214 with Bristol’s OPDIVO, which will enroll up to 260 patients in eight target cancer indications."

Revenue in the second quarter of 2017 was $34.6 million as compared to $32.8 million in the second quarter of 2016. Year-to-date revenue for 2017 was $59.3 million as compared to $91.6 million in the first half of 2016. Revenue in the first half of 2016 was higher primarily because of the recognition of $28.0 million received from AstraZeneca for the sublicense of MOVENTIG to Kirin in Europe.

Total operating costs and expenses in the second quarter of 2017 were $85.2 million as compared to $71.1 million in the second quarter of 2016. Total operating costs and expenses in the first half of 2017 were $164.4 million as compared to $139.5 million in the first half of 2016. Total operating costs and expenses increased primarily because of research and development (R&D) expense, which included the completion of Phase 3 clinical studies for NKTR-181.

R&D expense in the second quarter of 2017 was $60.3 million as compared to $52.4 million in the second quarter of 2016. For the first half of 2017, R&D expense was $121.3 million as compared to $101.6 million in the first half of 2016. R&D expense was higher in the second quarter and first half of 2017 as compared to the same periods in 2016 and includes increased expenses for our pipeline programs, including clinical development of NKTR-214 and NKTR-358 and preclinical activities for NKTR-262 and NKTR-255.

General and administrative (G&A) expense was $16.0 million in the second quarter of 2017 as compared to $11.0 million in the second quarter of 2016. Q2 2017 G&A expense includes a $3.3 million charge for a litigation settlement related to a cross-license agreement. G&A expense in the first half of 2017 was $28.0 million as compared to $21.3 million in the first half of 2016.

Net loss in the second quarter of 2017 was $59.9 million or $0.39 loss per share as compared to a net loss of $48.6 million or $0.36 loss per share in the second quarter of 2016. Net loss was higher in Q2 2017 versus Q2 2016 primarily as a result of the litigation settlement expense and the increased R&D expense described above. Net loss in the first half of 2017 was $123.7 million or $0.80 loss per share as compared to a net loss of $68.1 million or $0.50 loss per share in the first half of 2016.

The company also announced the following upcoming presentation:

ESMO 2017 Congress, Madrid, Spain:

Poster 1212TiP: "PIVOT-02: A Phase 1/2, Open-label Multicenter, Dose Escalation and Dose Expansion Study of NKTR-214 and Nivolumab in Patients with Select Locally Advanced or Metastatic Solid Tumor Malignancies.", Diab, A., et al.
Date: September 9, 2017, 13:15 – 14:15 p.m. Central European Summer Time

On August 8, 2017 Galena Biopharma, Inc. (NASDAQ: GALE) and SELLAS Life Sciences Group Ltd, a privately-held, oncology-focused, clinical stage biopharmaceutical company, reported they have entered into an all stock definitive merger agreement under which SELLAS will merge into and become an indirect, wholly-owned subsidiary of Galena (Press release, Galena Biopharma, AUG 8, 2017, View Source [SID1234520194]). The combined company will be renamed SELLAS Life Science Group, Inc. The merger will result in a combined company focused on the development of novel treatments for cancer.

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The combined company will feature a late-stage pipeline led by novel immunotherapies targeting a broad range of indications in hematology and solid tumors. SELLAS licenses the rights to its lead asset, galinpepimut-S, (GPS), a novel WT1 antigen-targeting immunotherapy. GPS is initially being developed for the treatment of acute myeloid leukemia (AML) and is Phase 3-ready in this setting. SELLAS has also successfully completed a Phase 2 study of GPS in malignant pleural mesothelioma (MPM) and its end-of-Phase 2 meetings with the U.S. Food and Drug Administration (FDA) for GPS in both indications. For both AML and MPM, SELLAS has been granted orphan drug designation from the FDA and the European Medicines Agency (EMA) and been given FDA fast track status. In addition, SELLAS is currently conducting two Phase 2 trials of GPS in multiple myeloma, as well as a combination trial in ovarian cancer with nivolumab (OPDIVO; Bristol-Myers Squibb), and is currently preparing for additional combination trials for GPS in combination with another checkpoint inhibitor. Galena’s lead immunotherapy program, NeuVax (nelipepimut-S), is currently in three, Phase 2, investigator-sponsored clinical trials in breast cancer, and these trials will remain ongoing. Galena’s other development programs, GALE-401, a controlled release version of anagrelide that is Phase 3-ready, and GALE-301/GALE-302, an earlier stage cancer immunotherapy program targeting folate binding protein, are currently being evaluated for potential internal development or strategic partnership.

"This transaction with Galena is an important step for SELLAS and the advancement of our lead product candidate, GPS, through important development milestones," said Dr. Angelos Stergiou, SELLAS’s Chief Executive Officer. "We believe GPS has the potential to benefit a wide range of cancer patients and
become an important piece of the cancer immunotherapy treatment landscape as both a monotherapy and in combination with other agents, particularly checkpoint inhibitors. NeuVax strengthens our platform and may provide important value inflections as the clinical trials progress. The combined pipeline, with significant near term milestones, creates multiple development and partnering opportunities to create value as these programs evolve."

Stephen F. Ghiglieri, Galena’s Interim Chief Executive Officer and Chief Financial Officer, added, "Following a thorough review of strategic alternatives and extensive search for a merger partner, we selected SELLAS due to the depth of their cancer immunotherapy pipeline which is clearly complimentary to Galena’s development programs. In evaluating many alternatives, SELLAS stood out in terms of its vision, strategic alignment with Galena’s cancer immunotherapy programs, and near term opportunity for value creation for our shareholders. We are encouraged by the GPS data generated to date and the potential advancement of that program into clinical trials in several indications. I, and our board of directors, believe that patients and our shareholders have the opportunity to benefit greatly from the clinical development efforts that the combined companies will undertake."

About the Proposed Transaction
On January 31, 2017, Galena announced the initiation of a process to explore a range of strategic alternatives focused on maximizing shareholder value. After a thorough review of available alternatives, and extensive diligence and negotiation with SELLAS, Galena’s board of directors unanimously approved to enter into a definitive merger agreement with SELLAS.

Under the terms of the merger agreement, existing SELLAS shareholders will receive newly issued shares of Galena common stock. On a pro forma basis, assuming completion of the proposed merger, Galena stock and warrant holders are expected to own approximately 32.5%, and SELLAS shareholders will own approximately 67.5% of the combined company.

The transaction has also been unanimously approved by the SELLAS board of directors and a majority of SELLAS shareholders have agreed to vote in favor of the transaction. The proposed merger is expected to close in the fourth quarter of 2017, subject to the approval of Galena stockholders and other customary closing conditions.

Galena’s financial advisor for the transaction is Canaccord Genuity Inc. and Galena’s legal counsel are Paul Hastings LLP and BeesMont Law Limited. SELLAS’ financial advisor for the transaction is Guggenheim Securities, and SELLAS’ legal counsels are Cooley LLP and Conyers Dill & Pearman.

Management and Organization
Angelos M. Stergiou, MD, SCD h.c., Chief Executive Officer of SELLAS will become the Chief Executive Officer of the combined company. Upon completion of the merger, Galena’s board of directors will resign, and a new board of directors will be constituted consisting of seven members that will include five representatives appointed by SELLAS, two of whom will be independent directors, and two representatives designated by Galena subject to SELLAS’ approval. SELLAS’ management team will manage the combined company.

Upon closing of the transaction, the name of the combined company will become SELLAS Life Sciences Group, Inc. and shares of the combined are expected to continue trading on the NASDAQ Capital Market under a new ticker symbol, SLS.