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Spectrum Pharmaceuticals Reports Second Quarter 2016 Financial Results and Pipeline Update

On August 9, 2016 Spectrum Pharmaceuticals, Inc. (NasdaqGS: SPPI), a biotechnology company with fully integrated commercial and drug development operations with a primary focus in Hematology and Oncology, reported financial results for the three-month period ended June 30, 2016 (Press release, Spectrum Pharmaceuticals, AUG 9, 2016, View Source [SID:1234514431]).

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“I am very pleased with the progress we have made on our pipeline and our commercial portfolio,” said Rajesh C. Shrotriya, MD, Chairman and Chief Executive Officer of Spectrum Pharmaceuticals. “Our advanced development pipeline includes treatments for chemotherapy-induced neutropenia, breast cancer, and bladder cancer. The success of any of these drugs could transform the company. We are currently enrolling patients in the pivotal program for SPI-2012, which we believe has shown a compelling clinical profile in Phase 2 studies. In addition, Poziotinib has the potential to be a best in class pan-HER inhibitor, and we recently started enrolling breast cancer patients who have failed other HER2-directed therapies in a Phase 2 trial. Qapzola for post-surgical treatment of non-muscle invasive bladder cancer is under FDA review and we look forward to presenting our case to an FDA advisory panel next month. We are making advances in our pipeline that could lead to novel cancer therapies that would benefit both patients and shareholders.”

Pipeline Update:

SPI-2012 (eflapegrastim), a novel long-acting GCSF: A pivotal Phase 3 study was initiated under a Special Protocol Assessment (SPA) from the FDA in Q1 2016 to evaluate SPI-2012 in the management of chemotherapy-induced neutropenia in approximately 580 patients with breast cancer. Enrollment is on track and the company expects to file a BLA in 2018. Moderate to severe neutropenia is a serious side effect of certain chemotherapeutic agents which can lead to infection, hospitalization, and even death. The Phase 2 data demonstrated that SPI-2012 was non-inferior to pegfilgrastim at the middle dose tested, and statistically superior in terms of duration of severe neutropenia at the highest dose tested. SPI-2012 was also shown to have an acceptable safety profile with no significant dose-related or unexpected toxicities.
Poziotinib, a potential best-in-class, novel, pan-HER inhibitor: Spectrum is continuing to enroll a Phase 2 breast cancer program in the U.S., based on promising Phase 1 efficacy data in breast cancer patients who had failed multiple other HER2-directed therapies. In addition, multiple Phase 2 studies are being conducted in South Korea by Hanmi Pharmaceuticals and National OncoVenture.
Qapzola, a potent tumor-activated drug being investigated for non-muscle invasive bladder cancer: The FDA is expected to make a decision on Qapzola’s approval by the PDUFA date of December 11, 2016. The FDA plans to hold an advisory committee meeting on September 14, 2016. The Company is actively enrolling an additional randomized, placebo-controlled Phase 3 trial under a SPA agreement. The Phase 3 study has been specifically designed to build on learnings from the previous studies, as well as recommendations from the FDA.
Three-Month Period Ended June 30, 2016 (All numbers are approximate)

GAAP Results

Total product sales were $30.9 million in the second quarter of 2016. Product sales in the second quarter included: FUSILEV (levoleucovorin) net sales of $10.5 million, FOLOTYN (pralatrexate injection) net sales of $11.0 million, ZEVALIN (ibritumomab tiuxetan) net sales of $2.8 million, MARQIBO (vinCRIStine sulfate LIPOSOME injection) net sales of $2.1 million, BELEODAQ (belinostat for injection) net sales of $3.7 million and EVOMELA (melphalan) for injection net sales of $0.9 million.

Spectrum recorded net loss of $24.3 million, or $(0.35) per basic and diluted share in the three-month period ended June 30, 2016, compared to net loss of $2.3 million, or $(0.04) per basic and diluted share in the comparable period in 2015. Total research and development expenses were $14.3 million in the quarter, as compared to $9.6 million in the same period in 2015. Selling, general and administrative expenses were $27.6 million in the quarter, compared to $22.6 million in the same period in 2015.

Non-GAAP Results

Spectrum recorded non-GAAP net loss of $3.7 million, or $(0.05) per basic and diluted share in the three-month period ended June 30, 2016, compared to non-GAAP net loss of $0.5 million, or $(0.01) per basic and diluted share in the comparable period in 2015. Non-GAAP research and development expenses were $12.9 million, as compared to $9.1 million in the same period of 2015. Non-GAAP selling, general and administrative expenses were $16.1 million, as compared to $19.7 million in the same period in 2015.

Spectrum Pharmaceuticals Reports Second Quarter 2016 Financial Results and Pipeline Update

"I am very pleased with the progress we have made on our pipeline and our commercial portfolio," said Rajesh C. Shrotriya, MD, Chairman and Chief Executive Officer of Spectrum Pharmaceuticals. "Our advanced development pipeline includes treatments for chemotherapy-induced neutropenia, breast cancer, and bladder cancer. The success of any of these drugs could transform the company. We are currently enrolling patients in the pivotal program for SPI-2012, which we believe has shown a compelling clinical profile in Phase 2 studies. In addition, Poziotinib has the potential to be a best in class pan-HER inhibitor, and we recently started enrolling breast cancer patients who have failed other HER2-directed therapies in a Phase 2 trial. Qapzola for post-surgical treatment of non-muscle invasive bladder cancer is under FDA review and we look forward to presenting our case to an FDA advisory panel next month. We are making advances in our pipeline that could lead to novel cancer therapies that would benefit both patients and shareholders."

Pipeline Update:

SPI-2012 (eflapegrastim), a novel long-acting GCSF: A pivotal Phase 3 study was initiated under a Special Protocol Assessment (SPA) from the FDA in Q1 2016 to evaluate SPI-2012 in the management of chemotherapy-induced neutropenia in approximately 580 patients with breast cancer. Enrollment is on track and the company expects to file a BLA in 2018. Moderate to severe neutropenia is a serious side effect of certain chemotherapeutic agents which can lead to infection, hospitalization, and even death. The Phase 2 data demonstrated that SPI-2012 was non-inferior to pegfilgrastim at the middle dose tested, and statistically superior in terms of duration of severe neutropenia at the highest dose tested. SPI-2012 was also shown to have an acceptable safety profile with no significant dose-related or unexpected toxicities.
Poziotinib, a potential best-in-class, novel, pan-HER inhibitor: Spectrum is continuing to enroll a Phase 2 breast cancer program in the U.S., based on promising Phase 1 efficacy data in breast cancer patients who had failed multiple other HER2-directed therapies. In addition, multiple Phase 2 studies are being conducted in South Korea by Hanmi Pharmaceuticals and National OncoVenture.
Qapzola, a potent tumor-activated drug being investigated for non-muscle invasive bladder cancer: The FDA is expected to make a decision on Qapzola’s approval by the PDUFA date of December 11, 2016. The FDA plans to hold an advisory committee meeting on September 14, 2016. The Company is actively enrolling an additional randomized, placebo-controlled Phase 3 trial under a SPA agreement. The Phase 3 study has been specifically designed to build on learnings from the previous studies, as well as recommendations from the FDA.
Three-Month Period Ended June 30, 2016 (All numbers are approximate)

GAAP Results

Total product sales were $30.9 million in the second quarter of 2016. Product sales in the second quarter included: FUSILEV (levoleucovorin) net sales of $10.5 million, FOLOTYN (pralatrexate injection) net sales of $11.0 million, ZEVALIN (ibritumomab tiuxetan) net sales of $2.8 million, MARQIBO (vinCRIStine sulfate LIPOSOME injection) net sales of $2.1 million, BELEODAQ (belinostat for injection) net sales of $3.7 million and EVOMELA (melphalan) for injection net sales of $0.9 million.

Spectrum recorded net loss of $24.3 million, or $(0.35) per basic and diluted share in the three-month period ended June 30, 2016, compared to net loss of $2.3 million, or $(0.04) per basic and diluted share in the comparable period in 2015. Total research and development expenses were $14.3 million in the quarter, as compared to $9.6 million in the same period in 2015. Selling, general and administrative expenses were $27.6 million in the quarter, compared to $22.6 million in the same period in 2015.

Non-GAAP Results

Spectrum recorded non-GAAP net loss of $3.7 million, or $(0.05) per basic and diluted share in the three-month period ended June 30, 2016, compared to non-GAAP net loss of $0.5 million, or $(0.01) per basic and diluted share in the comparable period in 2015. Non-GAAP research and development expenses were $12.9 million, as compared to $9.1 million in the same period of 2015. Non-GAAP selling, general and administrative expenses were $16.1 million, as compared to $19.7 million in the same period in 2015.

10-Q – Quarterly report [Sections 13 or 15(d)]

Scynexis has filed a 10-Q – Quarterly report [Sections 13 or 15(d)] with the U.S. Securities and Exchange Commission (Filing, 10-Q, Scynexis, 2017, AUG 8, 2016, View Source [SID1234521725]).

10-Q – Quarterly report [Sections 13 or 15(d)]

Akebia has filed a 10-Q – Quarterly report [Sections 13 or 15(d)] with the U.S. Securities and Exchange Commission (Filing, 10-Q, Akebia, 2017, AUG 8, 2016, View Source [SID1234521563]).

Flamel Technologies Reports Second Quarter 2016 Results

On August 8, 2016 Flamel Technologies (NASDAQ: FLML) reported its financial results for the second quarter 2016 (Filing, Q2, Flamel Technologies, 2016, AUG 8, 2016, View Source [SID:1234514499]).
Second Quarter Highlights Include:

· Total revenue for second quarter 2016 was $38.9 million, compared to $48.6 million during the same period last year.

· GAAP net loss for the second quarter was ($20.0) million, or ($0.48) per diluted share, compared to GAAP net loss of ($16.9) million, or ($0.42) per diluted share, during the same period last year.

· Adjusted EBITDA was $10.1 million, compared to $23.8 million in the prior year.*

· Adjusted net loss for the second quarter was ($985,000), or ($0.02) per diluted share, compared to an adjusted net income of $11.5 million, or $0.29 per diluted share, during the same period last year. *

· Cash and marketable securities at June 30, 2016 were $154.9 million, compared to $160.0 million at March 31, 2016 and $144.8 million at December 31, 2015.

· Akovaz received FDA approval on April 29, 2016 and is scheduled to launch in August 2016.

* Non-GAAP financial measure. Descriptions of Flamel’s non-GAAP financial measures are included under the caption "Non-GAAP Disclosures and Adjustments" included within this document and reconciliations of such non-GAAP financial measures to their most closely applicable GAAP financial measures are found in the "Supplemental Information" section within this document.

Michael Anderson, Flamel’s Chief Executive Officer, commented, "We are particularly pleased with our second quarter results. Bloxiverz averaged over 40% share of the neostigmine market during the quarter, and Vazculep continued to build share to 32% of the 1mL market volume, while holding all of the 5mL and 10mL markets. We generated revenue of $38.9 million for the quarter and we look forward to launching our third sterile injectable product, Akovaz, this month. We believe the market potential for Akovaz is the largest yet from our portfolio of previously unapproved marketed drugs, or UMDs."

Mr. Anderson continued, "In addition to our strong UMD business, we continue to advance our pipeline of proprietary products forward. We received positive data from our Phase 1b trial with Medusa exenatide and, following guidance from FDA, we will be conducting an alcohol interaction study in the second half of 2016 with our Trigger Lock hydromorphone product to further test its abuse-deterrent capabilities."

"In regards to our most important project, Micropump sodium oxybate, we have been in dialogue with FDA and look forward to finalizing the Special Protocol Assessment for our Phase III trial in the very near term. We continue to make all the necessary preparations associated with running the trial, including registering clinical sites and preparing clinical supplies, in order to hit the ground running once we begin patient enrollment. Our once nightly version of sodium oxybate is a very exciting opportunity for us, and we are on track to complete our study in approximately one year, with the goal of filing a New Drug Application by the end of 2017 or early 2018," concluded Mr. Anderson.

Second Quarter 2016 Results

The Company achieved revenues during the second quarter 2016 of $38.9 million, compared to $48.6 million during the same period last year. In the second quarter 2016, the Company determined that it is now able to estimate the ultimate net selling price of its products at the time of shipment from its warehouse. Previously, the Company was unable to completely estimate certain gross to net deductions that occur throughout the selling channel due to a lack of historical data. . This sales through accounting method resulted in an approximate one month lag between the time product was shipped from the Company’s warehouse until it reached the final customer. As a result of this change, the Company recorded approximately $5.9 million of additional revenue in the second quarter 2016.

On a GAAP basis, the Company recorded a net loss of ($20.0) million during the second quarter 2016, or ($0.48) per diluted share, compared to a net loss of ($16.9) million, or ($0.42) per diluted share, for the same period last year. Included in the net loss for the second quarter 2016 was $23.9 million of charges related to the change in the fair value of related party contingent consideration. Adjusted net loss for the second quarter was ($985,000), or ($0.02) per diluted share, compared to an adjusted net income of $11.5 million, or $0.29 per diluted share, during the same period last year. The decline in adjusted net income and adjusted diluted EPS from the previous year was due to lower product sales resulting from increased competition and higher SG&A from investments in infrastructure, people, and expenses related to the Company’s planned cross-border merger to Ireland from France. The Company recognized a foreign currency exchange gain of $1.7 million in the second quarter 2016, compared to a foreign currency exchange loss of ($3.6) million in the prior year quarter. Please see the Supplemental Information section within this document for a reconciliation of adjusted EBITDA, adjusted net income and adjusted diluted EPS to the respective GAAP amounts.

Sales for the FSC product line were below the Company’s expectations for the second quarter 2016 as the Company continues to work on improving product distribution, increasing third party payer access, and refining territories to maximize representative effectiveness. The Company expects to continue making progress throughout the remainder of the year in this business segment. It recently closed the Charlotte office facility and has strengthened the sales management team.

For the six months ended June 30, 2016 cash flow from operations was $15.9 million, compared to $40.3 million in the same period last year. Cash and marketable securities at June 30, 2016 were $154.9 million, compared to $160.0 million at March 31, 2016.

2016 Revenue and R&D Spending Guidance

As a result of the stronger than expected market share for Bloxiverz, slightly better expected market conditions for Akovaz and the change in the Company’s ability to better estimate net selling price upon shipment of product from its warehouse, the Company is increasing its full year 2016 revenue guidance to the range of $125 to $140 million from its previous guidance range of $110 to $130 million. The Company expects to allocate a substantial amount of its R&D expenses on its sodium oxybate trial; however, timing of the spend will be slightly shifted to 2017 and, as a result, has lowered its 2016 R&D spending guidance to the range or $30 to $40 million from the range of $35 to $50 million.

Clinical Pipeline Updates

Flamel received positive results from a Phase 1b clinical trial of FT228, a once-weekly subcutaneous injection formulation of exenatide using its proprietary Medusa technology. The study achieved all pharmacokinetic (PK) and pharmacodynamic (PD) objectives throughout four weekly administrations of Medusa exenatide (FT228), and assessed the safety, steady-state PK profile and the product’s potential effect on biomarkers and surrogate endpoints upon repeated administrations. Exenatide is a GLP1 analog used to treat patients suffering from Type 2 Diabetes Mellitus. Medusa is a hydrogel depot technology that enables the modified/controlled delivery of drugs, and is ideally suited to the development of subcutaneously administered formulations.

One dose per week of FT228 at 140mcg was administered to twelve Type 2 Diabetes Mellitus patients over a four week period. Following each administration, a continuous release of exenatide was observed over a period of up to 14 days and a relative bioavailability exceeding 94% was demonstrated. The PD performance of FT228 was comparable to current marketed products, Victoza (liraglutide IR) and Bydureon (exenatide SR).

In addition, Flamel received feedback from the U.S. Food and Drug Administration (FDA) regarding the clinical development pathway for FT227, an abuse-deterrent, extended-release, oral hydromorphone product using the Company’s proprietary Trigger Lock drug delivery platform.

To date, the Company has completed two pharmacokinetic (PK) studies of FT227 in 30 healthy volunteers, in addition to an independent in vitro study confirming FT227’s superior resistance to extraction/recovery in various media under several different conditions compared to both Exalgo and Oxycontin. Following guidance from the FDA, Flamel will be conducting during the third quarter of 2016 an in vivo alcohol interaction study, which the Company believes will provide further confirmation of the robust abuse-deterrent capabilities of Trigger Lock.