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Interim Report for Kancera AB (publ) Q2 2016 January 1 – June 30, 2016

On August 19, 2016 Kancera reported results for Q2 2016 January 1 – June 30, 2016 (Press release, Kancera, AUG 19, 2016, View Source;releaseID=1182172 [SID:1234514645]).

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As a consequence of the acquisition of the subsidiary Kancera Förvaltning AB on 2016-06-16, the present Interim Report, Q2 2016, is prepared in accordance with IAS 34 and related parts of the Annual Accounts Act. The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU and the Swedish Annual Accounts Act. The accounting of the parent company has been prepared in accordance with the Annual Accounts Act and the Swedish Financial Reporting Board’s recommendation RFR 2, including a number of new or revised standards, interpretations and improvements adopted by the EU and apply from 1 January 2016. The transition to the new accounting standards was voluntary and did not affect the income statement or balance sheet for the period January 1 – March 31, 2016 accounted for using the previous principles, or the comparison figures used below in the comments from the previous year regarding the parent company Kancera AB (for comparison between the accounting policies, see Note 1).

The period January to March 2016 in brief

R&D expenses for the period amounted to SEK 8.7m (SEK 8.8m) of which the second quarter constituted SEK 4.4m (SEK 4.6m).
Operating income for the period amounted to SEK -10.5m (SEK -10.4m) of which the second quarter constituted SEK -5.5m (SEK -5.4m).
Income after financial items for the period amounted to SEK -10.5m (SEK -10.3m) of which the second quarter constituted SEK -5.5m (SEK -5.4m).
Earnings per share for the period were SEK -0.10 (SEK -0.10) of which the second quarter constituted SEK -0.05 (SEK -0.05).
Cash flow from operating activities for the period amounted to SEK -9.4m (SEK -10.9m) of which the second quarter constituted SEK -3.1m (SEK -5.8m).
Equity as of June 30, 2016 amounted to SEK 71.1m (SEK 31.2m) or SEK 0.68 (SEK 0.30) per share. The equity/assets ratio as of June 30, 2016 was 86 percent (76 percent).
Cash and cash equivalents as of June 30, 2016 amounted to SEK 68.7m (SEK 25.4m). Unpaid share issue expenses amount to approximately SEK 2.2m.
Significant events during the period

Kancera has from the 1st of January 2016 extended the lease of the company’s laboratories within the Karolinska Science Park for three years through an agreement with Humlegården Fastigheter.
Kancera has provided an update of the small molecule patent portfolio.
– A patent covering small molecule PFKFB3 inhibitors has been approved in the USA.

– A patent application covering new chemical series in the HDAC6 project has been filed.

– An international patent application covering ROR inhibitors has been strengthened by adding examples of additional highly potent ROR inhibitors.

Kancera reported that the company has developed a new series of ROR inhibitors that show improved pharmaceutical properties which will allow preclinical studies of their effect on e.g. solid tumors. These results have prompted Kancera to concentrate the investments in the ROR project to small molecule inhibitors and terminate the product development of a ROR-based vaccine. Furthermore, Kancera reported results from the Fractalkine project showing that KAN0440567 after oral administration to mice effectively blocks the function of the Fractalkine receptor.
Kancera announced that the company according to plan has received another payment of about SEK 2.8 million in January, 2016 from the EU for the A-PARADDISE project, which aims to develop drugs against parasitic diseases.
Kancera reported that ROR inhibitors have been tested against human triple negative breast cancer transferred to zebra fish. The experiments showed that Kancera’s small molecule ROR inhibitors are able to both reduce tumor size and metastases (spread) of this aggressive tumor form. Further, Kancera reported that the company´s PFKFB3 inhibitors are active in the same model of triple negative breast cancer and that a patent application has been filed covering the discovery that PFKFB3 inhibitors enhance the effect of radiation treatment.
Kancera reported that the Company due to positive efficacy data in disease models of cancer and pain has decided to exercise the exclusive option to acquire the Fractalkine project. The acquisition will be carried out in connection with the completion of the ongoing transfer of results and know-how from Acturum and AstraZeneca to Kancera. Payment for the project to Acturum Life Science AB will be made into three steps by a total of 6 million shares, of which the first payment is due at the submission of the application for authorization of a clinical trial after an approval by Kancera´s shareholders. In parallel, the company intends to validate a broader use of the drug candidate (KAN0440567) in order to demonstrate its full commercial potential.
With the authorization of the extraordinary general meeting on 22 April 2016, Kancera AB carried out an issue of units with preferential rights for the shareholders, as well as an issue of units in the form of over-allotment space through a separate directed share issue without preferential rights. The rights issue, which was fully subscribed in May 2016, concerned 20,785,072 units and an over-allotment space of 4,000,000 units consisting of one share and one warrant at a price of SEK 2.50 per unit. On top of this compensation to underwriters and financial advisors was added. After registration of the issuance of the over-allotment option and compensation to underwriters and financial advisors, the number of shares in Kancera AB amounts to 131,486,720 and the number of warrants to 27 561 356. The new issue has brought Kancera AB approximately SEK 61.9 million before issue costs. The issue assets will be used for Kancera’s drug development, clinical studies and the further development of the Company’s capacity to commercialize products. The majority of Kancera’s resources are now concentrated on taking at least one of Kancera’s drug candidates in the ROR and Fractalkine projects to clinical trial for chronic lymphocytic leukemia and pancreatic cancer, respectively. In parallel, the Company intends to validate a broader use of the drug candidates from these projects in order to demonstrate their full commercial potential.
Kancera provided the following operational update of the fractalkine and ROR projects:
– the Fractalkine antagonist KAN0440567 is able to eliminate pain resulting from inflammation of the pancreas. This type of pain is similar to the pain resulting from cancer in the pancreas and therefore these results support the continued development of KAN0440567 towards clinical trials against cancer.

– the ROR inhibitor KAN0439834 has been shown to effectively kill resistant cancer cells from the bone marrow of multiple myeloma (MM) patients. MM originates in the bone marrow and is an incurable chronic disease today. Further studies are now focused on translating these findings to effects in animal models of MM which will provide a basis for decisions on future clinical trials evaluating Kancera’s ROR inhibitors.

Kancera AB announced that VINNOVA has paid an additional SEK 358,451 to the HDAC6 project as part of the grant totaling SEK 2 million which has been designated by VINNOVA for the further development of Kancera’s HDAC6 inhibitors against cancer. This payment was made following the approval of Kancera’s third progress report for the project.
Kancera AB hereby announces that its subsidiary Kancera Förvaltning AB has been formed. The operations of the subsidiary include mainly financial management including Kancera’s stock option plan.
Significant events after the end of the reporting period

Kancera AB has not reported any significant events after the end of the period.

Xenetic Biosciences Announces FDA Acceptance of Investigational New Drug Application to Initiate Phase 2 Clinical Trial of Virexxa® in Endometrial Cancer

On August 19, 2016 Xenetic Biosciences, Inc. (OTCQB: XBIO) ("Xenetic" or the "Company"), a biopharmaceutical company developing next-generation biologic drugs and novel orphan oncology therapeutics, reported that an Investigational New Drug (IND) application for the Company’s product candidate, Virexxa (sodium cridanimod), has been allowed to proceed by the U.S. Food and Drug Administration (FDA) (Press release, Xenetic Biosciences, AUG 19, 2016, View Source [SID:1234514655]). This enables Xenetic to initiate a Phase 2 clinical study of Virexxa in conjunction with progestin therapy for the treatment of endometrial cancer in women with recurrent or persistent disease who have failed progestin monotherapy. The primary objective of the study is to assess the anti-tumor activity of Virexxa. Secondary objectives include assessment of additional efficacy, pharmacokinetic and safety/tolerability parameters. Further translational objectives are to observe the effect of Virexxa in combination with progestins, on the levels of progesterone receptor (PrR) and activated progesterone receptors (APrR) in tumor tissues.

"This IND clearance enables us to proceed with our Phase 2 study in endometrial cancer and represents a major step forward in our clinical development of Virexxa," stated Scott Maguire, CEO. "We believe Virexxa to be a next-generation therapeutic that has the potential to provide women with no additional treatment options a novel and effective therapy."

Endometrial cancer is the most common malignancy of the female genital tract and represents a major health concern, as overall five-year survival rates have not improved over the past three decades. Annually in the United States, an estimated 60,050 patients are diagnosed with endometrial cancer and 10,470 deaths occur from this disease, representing 1.8% of all cancer deaths in the US. The incidence of endometrial cancer is on the rise with a lifetime risk of approximately 3% while the disease-specific mortality of endometrial carcinoma has been rising in the last 25 years. Endometrial cancer patients whose tumors no longer express progesterone receptors are not candidates for progestin-based therapy. Patients who fail monotherapy with progestins have no additional treatment options. Virexxa may improve sensitivity to progestin therapy in subjects with advanced or recurrent PrR-negative tumors.

About Virexxa
Virexxa is a small-molecule immunomodulator and interferon inducer which, in preliminary studies, has been shown to increase progesterone receptor (PrR) expression in endometrial tissue. Restoration of PrR expression may re-sensitize endometrial tumor tissue to progestin therapy in previously unresponsive tumors.

Virexxa is currently being studied in an ongoing Phase 2 multi-national study enrolling 58 subjects with documented evidence of progesterone receptor negative (PrR-negative) endometrial cancer as determined by tumor biopsy. This study is being conducted in conjunction with Pharmsynthez PJSC (St. Petersburg Russia) and its subsidiary AS Kevelt (Tallinn, Estonia). For more information on this Phase 2 study of Virexxa for the treatment of PrR-negative endometrial cancer, please visit www.clinicaltrials.gov and reference Identifier NCT02064725.

10-K – Annual report [Section 13 and 15(d), not S-K Item 405]

Immunomedics has filed a 10-K – Annual report [Section 13 and 15(d), not S-K Item 405] with the U.S. Securities and Exchange Commission (Filing, 10-K, Immunomedics, AUG 18, 2016, View Source [SID1234514636]).

Virogin Biotech Ltd. Joining Forces with Guangdong University of Technology, Establishing Joint Research Lab on Virotherapy

On August 18, 2016 Virogin Biotech Ltd. ("Virogin") reported its strategic collaboration with Guangdong University of Technology (GDUT) in China (Press release, Virogin Biotech, AUG 18, 2016, View Source [SID1234518864]).

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The first step of such collaboration is the Joint Research Lab on Virotherapy, which will be located in Institute of Biomedical and Pharmaceutical Sciences at GDUT. The Institute is a newly established faculty at GDUT equipped with brand new laboratories for translational research. The lab will focus primarily on oncolytic virology and cancer immunology, and is expected to be fully functional by October 2016.
Guangdong University of Technology is a key provincial university in Guangzhou, Guangdong, China. The university offers a wide range of courses in engineering, science, technology, management, liberal arts and law; and it has the privilege to confer Doctor’s, Master’s, and Bachelor’s degrees. It has played an active role in international scientific research and cultural cooperation and exchanges.
Guangdong University of Technology
The objectives of Virogin’s strategic collaboration with GDUT are 1) to facilitate and bridge the gap between academic research and industrial application; 2) to establish a platform for technical exchange and resource pooling; and 3) to further academic research and development by combining Virogin’s experience and expertise in the field with GDUT’s strong research capabilities and cutting-edge infrastructure.
Dr. Wen Tan, Dean of Institute of Biomedical and Pharmaceutical Sciences at GDUT, expressed his excitement and vision for the future of the joint lab, "Oncolytic virology and cancer immunology are the emerging trends in the biomedical world. As the Dean, it is my responsibilities to provide our students with the most up-to-date knowledge and exposure. As for our partner, Virogin Biotech is a very promising company in this field with a strong R&D team and an experienced management team. Its CSO Dr. William Jia is not only one of the pioneers in the field of oncolytic virology with over 20 years of research experience, but also the ideal person to facilitate such collaboration, because as a professor at UBC he would be able to better understand and bring together academia and industry. Ultimately through our collaboration with Virogin Biotech, we wish to establish a world-class research facility in virotherapy."
Virogin Biotech’s Co-founders – CSO Dr. William Jia and CEO Mr. Chris Huang also indicated their high expectation for the collaboration, "Guangdong University of Technology is a well-known and well-respected university in China that also actively involves in international scientific research collaboration. The Institute of Biomedical and Pharmaceutical Sciences, despite being new, has very strong research capabilities with state-of-the-art research facilities and infrastructure. With our company’s active involvement, we expect to pool resources together, while sharing our years of experience and expertise in oncology and virotherapy. We’ve already recruited several talented PhDs globally to carry out post-doctoral studies in the field at this lab. We believe by combining our strengths, we will be able to achieve mutually beneficial outcomes; and ultimately, reaching significant scientific breakthroughs that would benefit the world."
Virogin‘s Co-founders Dr. William Jia and Mr. Chris Huang, accompanying Dr. Wen Tan, Dean of GDUT’s Institute of Biomedical and Pharmaceutical Sciences, at Dr. Jia‘s research lab at UBC.

Zymeworks Receives FDA Acceptance of IND Application for ZW25, a Novel Bi-Specific Antibody, for the Treatment of HER2-Expressing Cancers

On August 18, 2016 Zymeworks Inc., a biopharmaceutical company discovering and developing innovative multi-functional protein-based therapeutics, including bi-specific antibodies and drug conjugates, for the treatment of cancer, reported that the United States Food and Drug Administration (FDA) has accepted the Company’s Investigational New Drug (IND) application for ZW25 for the treatment of certain HER2-expressing cancers (Press release, Zymeworks, AUG 18, 2016, View Source [SID:1234514640]). The Phase 1 clinical trial for ZW25 is anticipated to begin in late August of this year.

ZW25 is Zymeworks’ lead therapeutics program. It is a novel bi-specific antibody, developed using the Company’s industry-leading Azymetric platform, to target two different epitopes (bi-paratopic targeting) of the human epidermal growth factor receptor 2 (HER2) protein, which is over-expressed on the surface of many tumor types, including certain breast, gastric, lung, and ovarian cancers. ZW25 will be evaluated in the clinic for safety as well as efficacy in patients with tumors with low to moderate levels of HER2 expression. There are significant unmet medical needs for these patients as the current standard of care treatment approaches do not include HER2-targeted immunotherapies such as ZW25.

"We are proud and excited to advance ZW25 into clinical trials. We strongly believe ZW25 will address the needs of many HER2-expressing cancer patients, especially those who do not qualify for targeted HER2 therapies and other biologics," said Ali Tehrani, Ph.D., Zymeworks’ President & CEO. "We remain committed to the research and development of protein based therapeutics to address unmet medical needs and that we believe will result in patients returning home to their loved ones, cancer free."

"We’re pleased the FDA has cleared ZW25 for this first Phase 1 study in patients with locally advanced and/or metastatic HER2-expressing cancers and we look forward to initiating this clinical program in late August," said Diana Hausman, M.D., Zymeworks’ Chief Medical Officer. "This is a significant milestone for Zymeworks and for the development of ZW25, and we are excited about its therapeutic potential in HER2-expressing cancers."

Previously, the FDA granted Orphan Drug Designation to Zymeworks’ ZW25 for the treatment of ovarian cancer. Orphan designation qualifies Zymeworks for a number of development incentives, including tax credits for clinical testing and marketing exclusivity for a period of seven years if ZW25 is approved for this indication.

About ZW25

ZW25 is Zymeworks’ lead therapeutics program based on the Azymetric platform. It is an engineered bi-specific antibody that targets two different epitopes (bi-paratopic targeting) of the HER2 protein and confers its efficacy via multiple mechanisms of action, including: (i) enhanced antibody-mediated effector function resulting from the increased decoration of the tumor cell surface; (ii) increased blockade of the HER2 cellular growth signal by the dual engagement of HER2 epitopes; and (iii) increased removal of surface-expressed HER2 protein due to enhanced HER2 internalization upon antibody engagement. ZW25 as a best-in-class HER2-targeting antibody for a variety of tumors characterized by HER2 overexpression, including breast, gastric, ovarian, colorectal and non-small cell lung cancers.

About Azymetric Platform

Bi-specific antibodies developed using the Azymetric platform resemble conventional mono-specific antibodies while being able to simultaneously bind to two different targets resulting in additive or synergistic therapeutic responses. Azymetric antibodies spontaneously assemble into a single molecule with two different Fab domains comprising of unique heavy and light chain pairings. Azymetric antibodies are manufactured using conventional monoclonal antibody processes and can be easily adapted to rapidly screen target and sequence combinations for bi-specific activity in the final therapeutic format, thereby significantly reducing drug development timelines.