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Sequenom, Inc. Reports First Quarter 2016 Results

On May 4, 2016 Sequenom, Inc. (NASDAQ: SQNM), a life sciences company committed to enabling healthier lives through the development of innovative products and services, today reported total revenues of $27.6 million, total accessioned units of 46,400, and a net loss of $13.4 million, or $0.11 per basic and diluted share, for the first quarter of 2016 (Press release, Sequenom, MAY 4, 2016, View Source [SID:1234511939]).

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"During the quarter, we executed on a number of key initiatives designed to return Sequenom to sustainable growth, resulting in quarter over quarter growth in our unit volume," said Dirk van den Boom, Ph.D., President and CEO of Sequenom. "Overall, we made meaningful progress toward achieving our goal of becoming financially self-sustaining while solidifying our position as a leader in reproductive health."

Operational Updates

To date in 2016, Sequenom and Sequenom Laboratories made significant progress on several key corporate objectives:

Total tests accessioned in the first quarter of 2016 reflect growth of 10% in test volume compared to the fourth quarter of 2015. Sequenom Laboratories’ total noninvasive prenatal test (NIPT) accessions in the first quarter of 2016 were up 3,900 units sequentially from the fourth quarter of 2015, for growth of 11%;
Completed the consolidation of Sequenom Laboratories’ North Carolina laboratory location into the San Diego laboratory location;
Enhanced San Diego laboratory productivity and restructured other key functions, consistent with the annualized cost reduction goal of greater than $20 million before the end of 2016;
Negotiated in-network contracts with Anthem Blue Cross and Blue Shield Health Plans for 11 states. Sequenom Laboratories has coverage for over 200 million commercial lives and 46 million lives under Medicaid programs;
Filed a writ of certiorari asking the U.S. Supreme Court to decide if the claims of Sequenom’s ‘540 patent are directed to patent-eligible subject matter;
Launched Sequenom Laboratories’ testing portfolio into the average-risk pregnancy market and optimized its sales approach to better serve the obstetrician channel; and
Introduced a multi-faceted physician and patient customer experience program that seeks to provide a best-in-class experience at every step of the customer journey.
First Quarter 2016 Results

First quarter 2016 revenues of $27.6 million declined 27% from $37.8 million in the first quarter of 2015. Revenues and unit volumes in the first quarter of 2016 were lower than the first quarter of 2015, primarily reflecting the conversion of certain laboratory customers to licensee status under the Pooled Patents Agreement, and a smaller amount available to collect during the first quarter of 2016 for testing services performed in prior periods. This latter factor reflects the improvement in the timeliness of Sequenom Laboratories collections as a result of additional payor contracts. These changes resulted in approximately $10 million in net revenue reduction for the first quarter of 2016 compared to the first quarter of 2015.

Total patient samples accessioned decreased by 12% to 46,400 patient samples during the first quarter of 2016, compared to the prior year’s first quarter. Approximately 41,200 of those patient samples accessioned were for NIPT, including the MaterniT 21 PLUS, VisibiliT and MaterniT GENOME laboratory-developed tests, which is a 9% decrease in testing volume compared to the first quarter of 2015. The decrease in tests accessioned was driven by the conversions of laboratory customers to licensee status, as described above, partially offset by the increase in tests accessioned for patients in the average-risk pregnancy market.

The total volume of tests from Sequenom’s core business increased by 7% over the first quarter of 2015, largely as a result of Sequenom Laboratories’ entry into the average-risk pregnancy market. In this press release, "core business" refers to Sequenom’s revenue and unit volume excluding the effect of the conversion of certain laboratory customers to licensee status in 2015. Notably, the volume of NIPT tests in Sequenom’s core business, which includes average-risk pregnancies, increased by 14% for the first quarter of 2016 over the first quarter of 2015.

License revenue was $2.2 million in the first quarter of 2016, compared to $2.1 million for the first quarter of 2015, and $2.3 million in the fourth quarter of 2015. Sequenom continues to expect a total of $10 million in license fee revenue for 2016.

Total cost of revenues decreased to $16.8 million for the first quarter of 2016, compared to $19.3 million for the prior year period. Cost of revenues decreased primarily due to the decrease in test volumes as a result of the conversion of certain laboratory customers to licensee status.

Gross margin for the first quarter of 2016 was 39% compared to gross margin of 49% for the first quarter of 2015. The effect of laboratory customers who converted to licensee status, costs associated with Sequenom Laboratories’ laboratory consolidation and restructuring, the impact of entering the average-risk pregnancy market and increased MaterniT GENOME volume largely drove the decrease. Incremental costs related to the laboratory consolidation reduced gross margin for the first quarter of 2016 by 3%. Sequenom continues to expect gross margin to increase for the remaining quarters of 2016.

Total operating expenses for the first quarter of 2016 were $22.1 million, compared to $23.0 million for the first quarter of 2015. Total operating expenses for the first quarter of 2016 were up only slightly from total operating expenses of $21.9 million for the fourth quarter of 2015, due to the costs associated with Sequenom Laboratories’ laboratory consolidation and other restructuring activities, which offset the benefit of reduced spending for research and development and general and administrative activities.

Operating loss for the first quarter of 2016 was $11.4 million, compared to operating income of $16.5 million for the same period in 2015. Operating and net income for the first quarter of 2015 included a $21.0 million gain on the Pooled Patents Agreement with Illumina. Net loss for the first quarter of 2016 was $13.4 million or $0.11 per basic and diluted share, as compared to net income of $14.3 million, or $0.11 per diluted share, and $0.12 per basic share for the same period in 2015.

Cash burn for the first quarter of 2016 was $10.4 million, compared to $9.4 million in the same period of 2015 and $4.7 million in the fourth quarter of 2015. Cash burn increased in the first quarter of 2016 primarily due to reduced revenue collected for testing services performed in prior periods and delays in collections related to the launch of tests into the average-risk pregnancy market. Cash burn in the first quarter also included semi-annual interest payments on Sequenom’s convertible debt.

Unrecorded accounts receivable for tests performed and recognized on a cash basis are estimated to be $16 million to $18 million as of March 31, 2016, the same as the estimate as of December 31, 2015.

As of March 31, 2016, cash, cash equivalents, and marketable securities totaled $66.1 million.

Non-GAAP Financial Measures

"GAAP" refers to financial information presented in accordance with generally accepted accounting principles in the United States. To supplement the condensed consolidated financial statements and discussion presented on a GAAP basis, this press release includes non-GAAP financial measures with respect to the quarter ended March 31, 2016. Management uses non-GAAP financial measures because it believes that a cash flow metric incorporating cash used in operations and certain other uses of cash are important to understand the cash requirements of the business. The Company reported cash burn as a non-GAAP financial measure. This non-GAAP financial measure is not in accordance with, or an alternative to, GAAP.

Management uses cash burn to evaluate performance compared to forecasts. Cash burn is calculated as the sum of net cash used in operating activities, purchases of property, equipment and leasehold improvements, and payments on long-term obligations. The reconciliations of cash used by operating activities, the GAAP measure most directly comparable to cash burn, is provided on the attached schedule.

PDL BioPharma Announces First Quarter 2016 Financial Results

On May 4, 2016 PDL BioPharma, Inc. (PDL) (NASDAQ: PDLI) reported financial results for the first quarter ended March 31, 2016(Press release, PDL BioPharma, MAY 4, 2016, View Source [SID:1234511937]).

Total revenues of $103.1 million for the first quarter of 2016.
Non-GAAP diluted earnings per share (EPS) of $0.52 increased approximately 11 percent versus the same period in 2015.
Non-GAAP net income increased 7 percent to $84.8 million.
GAAP diluted EPS of $0.34 decreased by 32 percent compared to the same period of 2015.
GAAP net income decreased by 34 percent to $55.9 million.
The largest component of the difference in non-GAAP measure compared to GAAP is the exclusion of mark-to-market adjustments related to the fair value election of our investments in royalty rights. A full reconciliation of all components of the GAAP to Non-GAAP quarterly financial results can be found in Table 4 at the end of this release.
Revenue Highlights
Total revenues of $103.1 million for the quarter ended March 31, 2016 included:
Royalties from PDL’s licensees to the Queen et al. patents of $121.5 million, which consisted of royalties earned on sales of products under license agreements associated with the Queen et al. patents;
Net royalty payments from acquired royalty rights and a change in fair value of the royalty rights assets of negative $27.1 million, which consisted of revenues associated with the change in estimated fair value of our royalty right assets and primarily related to the Depomed, Inc. royalty rights acquisition;

Interest revenue from notes receivable debt financings to late-stage healthcare companies of $9.0 million; and
License and other revenues of negative $0.2 million, which consisted of a negative $0.3 million mark-to-market adjustments on warrants held and, a realized gain of $0.1 million from the sale of PDL’s investment in AxoGen Inc. common stock.
Total revenues decreased by 31 percent for the first quarter ended March 31, 2016, when compared to the same period in 2015.
The decrease in royalties from PDL’s licensees to the Queen et al. patents is due to decreased Lucentis and Actemra royalties as a result of the conclusion of their license agreements, partially offset by increased royalties from other Queen et al. royalty revenues.

PDL expects its revenue from the Queen et al. patents to materially decrease beyond this first quarter of 2016.
The decrease in royalty rights – change in fair value was driven by the $47.9 million decrease in the fair value of the Depomed royalty rights assets and is primarily a result of lower than expected cash royalties in the first quarter and an adjustment reducing future cash flows due to lower projected demand data, greater erosion of market share due to the launch of a generic, and higher gross-to-net adjustments for Glumetza.

PDL received $17.2 million in net cash royalty payments from its acquired royalty rights in the first quarter of 2016, compared to $0.9 million for the same period of 2015.
The decrease in interest revenues was due to reduced interest from Direct Flow Medical, Inc. as a result of ceasing to accrue interest due to the loan being impaired.

Operating Expense Highlights
Operating expenses were $9.8 million for the quarter ended March 31, 2016, compared to $7.7 million for the same period of 2015.
The increase in operating expenses for the quarter, as compared to the same period in 2015, was a result of an increase in general and administrative expenses of $1.5 million for legal service expenses mostly related to business development activities, the asset management of Wellstat Diagnostics, legal expenses related to a complaint against Merck Sharp & Dohme, Corp, and $0.9 million for compensation, including stock-based compensation, offset in part by a decrease in professional services from asset management expenses.

Other Financial Highlights
PDL had cash, cash equivalents, and short-term investments of $292.0 million at March 31, 2016, compared to $220.4 million at December 31, 2015.

The increase was primarily attributable to proceeds from royalty right payments of $17.2 million and cash generated by operating activities of $92.5 million, offset in part by the repayment of a term loan for $25.0 million, payment of dividends of $8.2 million and an additional note receivable purchase of $5.0 million.
Net cash provided by operating activities in the first quarter of 2016 was $92.5 million, compared with $71.8 million in the same period in 2015.

Recent Developments
Q2 2016 Dividends
On May 2, 2016, our board of directors declared a quarterly dividend of $0.05 per share of common stock to be paid on June 13, 2016 to stockholders of record on June 6, 2016, the record date of the dividend payment.

MacroGenics Provides Update on Corporate Progress and First Quarter 2016 Financial Results

On May 04, 2016 MacroGenics, Inc. (NASDAQ:MGNX), a clinical-stage biopharmaceutical company focused on discovering and developing innovative monoclonal antibody-based therapeutics for the treatment of cancer, as well as autoimmune disorders and infectious diseases, reported a corporate progress update and reported financial results for the quarter ended March 31, 2016 (Press release, MacroGenics, MAY 4, 2016, View Source [SID:1234511934]).

"MacroGenics made steady progress across its pipeline of clinical and research-stage compounds during the first quarter of 2016," said Scott Koenig, M.D., Ph.D., President and CEO of MacroGenics. "The SOPHIA study, a Phase 3 trial of margetuximab, our Fc-optimized anti-HER2 monoclonal antibody, continues to enroll patients with metastatic breast cancer. Our immuno-oncology efforts, highlighted by the B7-H3 franchise, also progressed nicely. We anticipate sharing additional enoblituzumab monotherapy study data later this year. Further, our portfolio of innovative molecules was the subject of five poster presentations at the recent American Association of Cancer Research annual meeting."

"As we look forward in 2016 and beyond, we expect to continue our pace of generating promising clinical development candidates based on MacroGenics’ technology platforms," commented Dr. Koenig. "In particular, we expect to submit one IND later this year and two additional INDs in 2017."

Pipeline Update

Margetuximab. Recent highlights related to our Fc-optimized monoclonal antibody that targets the human epidermal growth factor receptor 2, or HER2, include:

SOPHIA Study: MacroGenics’ Phase 3 pivotal study in patients with HER2-positive metastatic breast cancer is ongoing, as the Company continues to initiate sites and enroll patients. This study is evaluating the efficacy of margetuximab plus chemotherapy compared to trastuzumab plus chemotherapy in approximately 530 patients following progression after at least two lines of previous therapy. The Company is targeting completion of this study in 2018.
Phase 1b/2 Gastric Cancer Study: During the first quarter of 2016, MacroGenics dosed the first patient in a Phase 1b/2 clinical trial of margetuximab in combination with pembrolizumab, an anti-PD-1 therapy, in patients with advanced HER2-positive gastric cancer. Treatment options for these patients are limited and this proposed combination regimen being studied would avoid chemotherapy while exploiting the expected enhanced immune-mediated killing properties of both margetuximab and pembrolizumab. This trial is being conducted in collaboration with Merck and is currently recruiting patients in the United States, with plans to expand into Asian sites later this year.
B7-H3 Franchise. MacroGenics is developing a portfolio of therapeutics that target B7-H3, a member of the B7 family of molecules involved in immune regulation. The Company is advancing multiple programs that target B7-H3 through complementary mechanisms of action and take advantage of this antigen’s broad expression across multiple solid tumor types. Current ongoing development programs include:

Enoblituzumab (MGA271): The Company continues to recruit patients in three ongoing studies of enoblituzumab, an Fc-optimized monoclonal antibody that targets B7-H3. These studies include one monotherapy study and two combination studies with each of ipilimumab and pembrolizumab.
MGD009: This DART molecule targeting B7-H3 and CD3 is being evaluated in a Phase 1 study across multiple solid tumor types. The results of preclinical studies of MGD009 were presented in an oral presentation at Keystone Symposia’s Antibodies as Drugs (X2) conference in March. These studies demonstrated that MGD009 redirected T cells to kill B7-H3-expressing human cancer cell lines from a range of tumor types in multiple in vitro and in vivo models.
B7-H3 Antibody-drug Conjugate: At the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting in April, MacroGenics presented a poster that evaluated the therapeutic potential of anti-B7-H3 ADCs in multiple in vitro and in vivo models representing human cancer types that overexpress B7-H3.
DART Product Candidates. There are currently six DART molecules in Phase 1 clinical development, including MGD006 (CD123 x CD3, also known as S80880), MGD007 (gpA33 x CD3), MGD011 (CD19 x CD3, also known as JNJ-64052781), MGD010 (CD32B x CD79B), MGD009 (B7-H3 x CD3) and PF-06671008 (P-cadherin x CD3). The Company expects to submit IND applications for two additional DART molecules in 2017. These two product candidates are:

MGD013: MacroGenics is developing MGD013 to simultaneously block two immune checkpoint molecules, PD-1 and LAG-3. At the recent AACR (Free AACR Whitepaper) meeting, MacroGenics demonstrated that MGD013 has the potential to enhance T-cell immunomodulatory activity as compared to its individual components.
MGD014: MGD014 is a DART molecule that is being developed to eliminate latent HIV infection. MGD014 is being developed under a contract awarded to MacroGenics by the National Institute of Allergy and Infectious Diseases for up to $24.5 million. This is the first infectious disease DART program planned for clinical testing.
Beyond MGD013 and MGD014, MacroGenics continues to generate and evaluate multiple other candidates that target a range of immune regulatory and other molecules using its proprietary platforms. In addition to the B7-H3 ADC and MGD013 posters presented at the recent AACR (Free AACR Whitepaper) meeting, the Company also presented posters on the following three preclinical DART molecules at the meeting: EphA2 x CD3, IL13Rα2 x CD3 and ROR1 x CD3.

First Quarter 2016 Financial Results

Cash Position: Cash, cash equivalents and investments as of March 31, 2016 were $304.4 million, compared to $339.0 million as of December 31, 2015.
Revenue: Total revenue, consisting primarily of revenue from collaborative agreements, was $2.8 million for the quarter ended March 31, 2016, compared to $71.3 million for the quarter ended March 31, 2015. This decrease is primarily due to the $62.3 million in revenue recognized under the Janssen agreement in the first quarter of 2015.
R&D Expenses: Research and development expenses were $27.3 million for the quarter ended March 31, 2016, compared to $21.5 million for the quarter ended March 31, 2015. This increase was due primarily to increased activity in MacroGenics’ preclinical immune checkpoint programs, including MGD013, and the initiation of two Phase 1 clinical trials combining enoblituzumab with other compounds. This increase was partially offset by a decrease in margetuximab expense as a result of start-up costs in 2015 for the SOPHIA trial.
G&A Expenses: General and administrative expenses were $6.1 million for the quarter ended March 31, 2016, compared to $4.7 million for the quarter ended March 31, 2015. This increase was primarily due to higher labor-related costs, including stock-based compensation expense.
Net Loss: Net loss was $30.3 million for the quarter ended March 31, 2016, compared to net income of $45.1 million for the quarter ended March 31, 2015.
Shares Outstanding: Shares outstanding as of March 31, 2016 were 34,536,621.

Infinity Provides Company Update And Reports First Quarter 2016 Financial Results

On May 4, 2016 Infinity Pharmaceuticals, Inc. (NASDAQ: INFI) reported its first quarter 2016 financial results and ongoing progress with its pipeline, including duvelisib, an investigational, oral, dual inhibitor of phosphoinositide-3-kinase (PI3K)-delta and PI3K-gamma, and IPI-549, an immuno-oncology development candidate that selectively inhibits PI3K-gamma (Press release, Infinity Pharmaceuticals, MAY 4, 2016, View Source;p=RssLanding&cat=news&id=2165087 [SID:1234511932]).

Infinity expects to report topline data from DYNAMO, a registration-focused Phase 2 monotherapy study of duvelisib in patients with refractory indolent non-Hodgkin lymphoma (iNHL), early in the third quarter of 2016. Infinity also anticipates completing an interim analysis of DUO, a registration-focused Phase 3 monotherapy study of duvelisib in patients with relapsed/refractory chronic lymphocytic leukemia (CLL), early in the second half of 2016. The company expects marketing applications, if supported by these data, to be submitted to the U.S. Food and Drug Administration (FDA) and European Medicines Agency (EMA) in the fourth quarter of 2016.

"We believe the next few months will be fundamental to advancing Infinity’s goal of bringing important new medicines to patients. If the duvelisib data that we anticipate in the coming months are favorable, these data could enable regulatory filings to be submitted in the U.S. and Europe in the fourth quarter of 2016. Achieving these milestones positions us to potentially bring duvelisib to patients next year," stated Adelene Perkins, president and chief executive officer. "Infinity is also advancing several clinical studies designed to evaluate the safety and activity of duvelisib in broader patient populations. Additionally, our collaborator, AbbVie, has initiated a Phase 1b/2 clinical study of duvelisib in combination with Venclexta," Ms. Perkins continued.

Recent developments:

Preliminary data from CONTEMPO to be presented in June: Infinity reported that preliminary data from CONTEMPO, a Phase 1b/2 study evaluating duvelisib in combination with rituximab or obinutuzmab in treatment-naïve follicular lymphoma patients, has been accepted for presentation in a poster session at the 21st Congress of European Hematology Association (EHA) (Free EHA Whitepaper), which will take place June 9 – 12, 2016, in Copenhagen.

Phase 1b/2 study of duvelisib in combination with Venclexta initiated: AbbVie has initiated a Phase 1b/2 clinical study of duvelisib in combination with Venclexta, AbbVie’s B-cell lymphoma-2 (BCL-2) selective inhibitor. This study is designed to evaluate the safety and efficacy of duvelisib in combination with venetoclax in approximately 174 patients with relapsed or refractory iNHL, aggressive NHL, small lymphocytic lymphoma or CLL.

Preclinical data for IPI-549 presented at the 2016 American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting: In April, Infinity researchers in collaboration with researchers at Memorial Sloan Kettering Cancer Center presented preclinical data for IPI-549 at the 2016 AACR (Free AACR Whitepaper) Annual Meeting. Preclinical data in multiple solid tumor models demonstrated that IPI-549 targets immune cells and alters the immune-suppressive microenvironment, promoting an anti-tumor immune response that leads to tumor growth inhibition. Data also demonstrated that IPI-549 enhances the effects of checkpoint inhibitors, resulting in improved survival in murine models.
A Phase 1 study of IPI-549 is ongoing to evaluate the safety, tolerability, pharmacokinetics and pharmacodynamics of IPI-549 as a monotherapy and in combination with an anti-PD-1 antibody, a checkpoint inhibitor, in approximately 150 patients with advanced solid tumors, including non-small cell lung cancer and melanoma. IPI-549 is the only investigational PI3K-gamma inhibitor in clinical development.

Inducement Grant Under NASDAQ Listing Rule 5635(c)(4): In connection with the appointment of Mr. Christopher Lindblom as vice president, finance and treasurer at Infinity, the Compensation Committee of Infinity’s Board of Directors approved the grant of an option to Mr. Lindblom to purchase 40,000 shares of Infinity’s common stock. The option was granted outside of the company’s equity incentive plans and was made as an inducement material to Mr. Lindblom’s acceptance of employment. The option has an exercise price of $5.87 per share, which is equal to the closing price of Infinity’s common stock on May 2, 2016. One-fourth of the shares underlying Mr. Lindblom’s option will vest on the one year anniversary of his date of hire and thereafter 1/48th of the shares underlying Mr. Lindblom’s option will vest monthly, such that the shares underlying the option will be fully vested on the fourth anniversary of his date of hire, subject to his continued employment with Infinity on each such vesting date.
First Quarter 2016 Financial Results

At March 31, 2016, Infinity had total cash, cash equivalents and available-for-sale securities of $193.0 million, compared to $245.2 million at December 31, 2015.

Revenue during the first quarter of 2016 was $9.3 million for research and development (R&D) services associated with the strategic collaboration with AbbVie for duvelisib in oncology, compared to $4.4 million for R&D services for the first quarter of 2015.

R&D expense for the first quarter of 2016 was $39.2 million, compared to $88.4 million for the first quarter of 2015. R&D expense for the first quarter of 2015 included a $52.5 million payment related to the exercise of an option to buy out the company’s royalty obligations to Takeda Pharmaceutical Company Limited for duvelisib worldwide oncology sales. Excluding the $52.5 million payment in 2015, the increase in R&D expense was primarily due to higher clinical development expenses for duvelisib as well as an increase in staffing.

General and administrative (G&A) expense was $10.8 million for the first quarter of 2016, compared to $8.6 million for the same period in 2015. The increase in G&A expense was primarily related to an increase in staffing as well as external commercial expenses in preparation for the potential launch of duvelisib in 2017.

Net loss for the first quarter of 2016 was $40.7 million, or a basic and diluted loss per common share of $0.82, compared to $93.3 million, or a basic and diluted loss per common share of $1.91, for the same period in 2015.
Conference Call Information
Infinity will host a conference call today, May 4, 2016, at 4:30 p.m. ET to discuss these financial results and company updates. A live webcast of the conference call can be accessed in the "Investors/Media" section of Infinity’s website at www.infi.com. To participate in the conference call, please dial 1-877-316-5293 (domestic) or 1-631-291-4526 (international) five minutes prior to start time. The conference ID number is 89736154. An archived version of the webcast will be available on Infinity’s website for 30 days.

About Duvelisib
Duvelisib is an investigational, oral, dual inhibitor of phosphoinositide-3-kinase (PI3K)-delta and PI3K-gamma, two proteins with predominantly non-overlapping roles known to support the growth and survival of malignant B-cells.[i] Preclinical data suggest that PI3K-delta signaling can lead to the proliferation of malignant B-cells, and both PI3K-gamma and PI3K-delta play a role in the formation and maintenance of the supportive tumor microenvironment.[ii] Duvelisib is the only investigational PI3K-delta,gamma inhibitor in Phase 3 clinical development and has the potential to be a first-in-class treatment for certain types of hematologic malignancies, or blood cancers. AbbVie and Infinity Pharmaceuticals, Inc. are jointly developing duvelisib in oncology.

Infinity and AbbVie are conducting a broad clinical development program evaluating duvelisib in patients with hematologic malignancies. In addition to DYNAMO and DUO, ongoing studies include BRAVURA, a Phase 3, double-blind, placebo-controlled study in patients with relapsed iNHL; FRESCO, a Phase 2 study in patients with relapsed/refractory follicular lymphoma; CONTEMPO, a Phase 1b/2 study in treatment-naïve patients with follicular lymphoma, and SYNCHRONY, a Phase 1b study in CLL patients previously treated with a Bruton’s tyrosine kinase (BTK) inhibitor. AbbVie has also initiated a clinical study in duvelisib in combination with Venclexta (venetoclax) in patients with relapsed or refractory CLL, small lymphocytic lymphoma, iNHL or aggressive NHL, as well as a Phase 1 study of duvelisib in Japanese subjects with relapsed or refractory lymphoma. Information about duvelisib clinical trials can be found on www.clinicaltrials.gov.

About IPI-549
IPI-549 is an investigational, orally administered immuno-oncology development candidate that selectively inhibits PI3K-gamma. In preclinical studies, IPI-549 inhibits immune suppressive macrophages within the tumor microenvironment, whereas other immunotherapies such as checkpoint modulators more directly target immune effector cell function. As such, IPI-549 may have the potential to treat a broad range of solid tumors and represents a potentially complementary approach to restoring anti-tumor immunity in combination with other immunotherapies such as checkpoint inhibitors.

Duvelisib and IPI-549 are investigational compounds and their safety and efficacy have not been evaluated by the U.S. Food and Drug Administration or any other health authority.

CombiMatrix Corporation Reports First Quarter 2016 Financial and Operating Results

On May 04, 2016 CombiMatrix Corporation (NASDAQ:CBMX), a molecular diagnostics company specializing in DNA-based testing services for pre-implantation genetic diagnostics and screening, miscarriage analysis, prenatal and pediatric diagnostics, reported financial results for the three months ended March 31, 2016 (Press release, CombiMatrix, MAY 4, 2016, View Source [SID:1234511927]).

"We are reporting another exceptional quarter of financial progress, with 28% revenue growth, expanded gross margin, increased cash collections and well managed operating expenses," said Mark McDonough, CombiMatrix President and CEO. "Our growth was driven by a 39% increase in reproductive health revenue on an 18% increase in test volume, reflecting higher average revenue per test. We are particularly pleased with our performance in miscarriage analysis testing, with revenues up 43% on 13% test volume growth. We also benefited from better productivity from our newer sales representatives, which contributed to an 18% increase in our customer base.

"We anticipate that various industry dynamics will favorably impact our business," he added. "In March, the two leading associations in women’s healthcare, the American College of Obstetricians and Gynecologists (ACOG) and the Society for Maternal-Fetal Medicine (SMFM), issued revised practice bulletins recommending that all women regardless of age or other risk factors are offered prenatal genetic testing. These bulletins reiterated the need to perform confirmatory testing when screening tests reveal positive results for fetal abnormalities. Additionally, a number of health plans, including Cigna and several in the Blue Cross Blue Shield network, have recently revised their medical policies to cover chromosomal microarray testing for recurrent pregnancy loss. We believe that more health plans will follow suit based on the growing clinical support for this valuable patient information.

"We are firmly focused on growth and a path toward profitability, supported by tight execution of our business strategy," said Mr. McDonough. "This year we plan to expand our IVF testing portfolio and expect to increase physician adoption through more clinical validation, improved marketing developed from the insights from our newly appointed Scientific Advisory Board, and greater productivity from our sales organization. We also are seeking opportunities to build upon our leadership position in the growing reproductive health diagnostics market and enhance shareholder value through partnerships and other business development alternatives. With the completion of an $8 million financing in late March, we are well positioned to execute on our plans."

First Quarter Financial and Operational Highlights (all comparisons are with the first quarter of 2015)

Total revenues of $3.0 million, up 28%
Reproductive health revenues of $2.2 million, up 39%
Reproductive health test volume of 1,426, up 18%
Number of billable customers reaches 264, up 18%
Cash collections of $2.5 million, up 15%
Closed $8.0 million underwritten public offering in March of 2016
Launched CombiPGD – Preimplantation Genetic Diagnosis for Single Gene Disorders and Chromosomal Translocations
Formed Scientific Advisory Board

Volumes
Revenues (in 000’s)
Q1 ’16 Q1 ’15 # Δ % Δ Q1 ’16 Q1 ’15 $ Δ % Δ
Prenatal 264 324 (60 ) (19 %) $ 321 $ 422 $ (101 ) (24 %)
Miscarriage analysis 995 882 113 13 % 1,622 1,132 490 43 %
PGS 167 - 167 - 222 - 222 -
Subtotal – reproductive health 1,426 1,206 220 18 % 2,165 1,554 611 39 %
Pediatric 452 467 (15 ) (3 %) 500 497 3 1 %
Subtotal – all arrays 1,878 1,673 205 12 % 2,665 2,051 614 30 %
Non-array tests 770 672 98 15 % 265 236 29 12 %
Total – all tests 2,648 2,345 303 13 % 2,930 2,287 643 28 %
Royalties 42 42 - 0 %
Total revenues $ 2,972 $ 2,329 $ 643 28 %

Financial Results

Total revenues for the first quarter of 2016 increased 28% to $3.0 million from $2.3 million for the first quarter of 2015. Revenues for the first quarter of 2016 were comprised of $2.9 million of diagnostic services revenue and $42,000 in royalties. Reproductive health diagnostic test revenue, which includes prenatal microarrays, miscarriage analysis and PGS, increased 39% to $2.2 million and related testing volumes increased 18% to 1,426. The first quarter 2016 revenue increase was driven partially by higher test volumes, particularly from miscarriage analysis and PGS testing, but primarily by higher average revenue per test in miscarriage analysis testing.

Total operating expenses were $4.4 million for the first quarter of 2016, compared with $4.1 million for the first quarter of 2015. The increase was due primarily to an increase in cost of services related to higher test volumes and from an increase in sales and marketing expenses related to sales force expansion. Gross margins for the first quarter of 2016 improved to 51.6% from 46.2% for the first quarter of 2015 due primarily to improved average reimbursement on miscarriage analysis testing.

The net loss for the first quarter of 2016 was $1.5 million, or $1.73 per share, compared with a net loss for the first quarter of 2015 of $1.8 million, or $2.24 per share. Net loss attributable to common stockholders for the first quarter of 2016 was $3.1 million, or $3.63 per share, compared with a net loss attributable to common stockholders for the first quarter of 2015 of $2.7 million, or $3.37 per share. The higher net loss attributable to common stockholders in 2016 reflected one-time, non-cash charges of $1.9 million related to deemed dividends from the issuance of Series F convertible preferred stock and warrants in the $8.0 million public offering that closed on March 24, 2016. This increase was partially offset by the reversal of the $890,000 Series E deemed dividend recognized in 2015 from the repurchase of those securities upon closing of our public offering, partially reduced by the $656,000 deemed dividend paid to the Series E investors in February of 2016.

The Company reported $6.6 million in cash, cash equivalents and short-term investments as of March 31, 2016, compared with $3.9 million as of December 31, 2015. The Company used $1.7 million in cash to fund operating activities during the first quarter of 2016, compared with $1.2 million to fund operating activities during the comparable period in 2015. The increase in net cash used to fund operating activities in 2016 resulted primarily from the timing of the purchase of inventory supplies, coupled with higher overall headcount in early 2016 compared with 2015.