On November 9, 2015 AVEO Oncology (NASDAQ:AVEO) reported financial results for the third quarter ended September 30, 2015 and provided a business update (Press release, AVEO, NOV 9, 2015, View Source;p=RssLanding&cat=news&id=2110273 [SID:1234508102]).

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"We completed partnerships for two of AVEO’s lead programs in the third quarter in addition to making progress toward our proposed plans to submit a European Marketing Authorization Application (MAA) for tivozanib in renal cancer and initiate a pivotal study in this indication in the U.S.," said Michael Bailey, president and chief executive officer. "As we work through recently initiated discussions with the SEC, we remain focused on executing against our goals through the balance of the year, including exploring potential partnership opportunities for tivozanib in Europe, while maintaining our very lean organization."

Prior to the submission of an MAA filing with the European Medicines Agency, the Company is seeking to complete a partnership agreement for tivozanib in Europe. If a partnership is completed, in order to provide a potential partner with the opportunity to submit the application on its own behalf, AVEO now anticipates that a submission would take place in the first quarter of 2016. Furthermore, assuming the availability of financial resources from this or other activities, the Company also now expects to initiate its Phase 3 U.S. pivotal study of tivozanib in patients with renal cancer early in the first quarter of 2016.

AVEO also announced today that the staff of the Securities and Exchange Commission and the Company recently entered into discussions for the settlement of potential claims that the Commission may bring against the Company asserting that the Company previously violated federal securities laws by omitting to disclose to investors a recommendation made to the Company by the U.S. Food and Drug Administration in May 2012. While the Company has commenced such discussions, it cannot predict their outcome, nor can it provide assurance that the Company will be able to resolve any potential claims of the Commission or that any potential settlement will not have a material adverse impact on the Company’s proposed plans or its financial position or results of operations.

Recent Highlights

Announced Exclusive Worldwide License Agreement for the Development and Commercialization of AV-380 and Related Antibodies. In August, AVEO announced an exclusive, worldwide license agreement with Novartis for the development and commercialization of AVEO’s first-in-class, potent, humanized inhibitory antibody targeting growth differentiation factor 15 (GDF15), AV-380, and related antibodies, including modified or derivative forms of any such antibody (the "Product"). Under terms of the agreement, AVEO has received an upfront payment of $15 million. Additionally, AVEO is eligible to receive $3.45 million in inventory reimbursement, and clinical, regulatory and sales-based milestone payments totaling $308 million, assuming successful advancement of the Product. AVEO will also be eligible to receive tiered royalties on product sales ranging from high single digits to a low double-digit. Novartis is responsible for all clinical development, manufacturing and commercialization activities and costs associated with the Product.

Announced Exclusive Licensing Agreement with Pharmstandard for Tivozanib in Russia, Ukraine and CIS. In August, AVEO announced that it had entered into an exclusive license agreement with a subsidiary of Pharmstandard Group for the development, manufacturing and commercialization of tivozanib in the territories of Russia, Ukraine and the Commonwealth of Independent States, for all indications excluding non-oncology ocular conditions. Under the terms of the agreement, AVEO has received $1 million in an upfront payment and Pharmstandard is obligated to pay AVEO an additional $0.5 million upon the registration of the agreement with Federal Services for Intellectual Property in Russia. AVEO is also eligible to receive up to $7.5 million in connection with the first marketing authorization of tivozanib in Russia, $3.0 million for each additional approved indication thereafter and a high single-digit royalty on net sales in the above mentioned territories. Pharmstandard will be responsible for all activities and costs associated with the further development, regulatory filings, health services and commercialization of tivozanib in the specified territories. A percentage of all upfront, milestone and royalty payments received by AVEO are due to Kyowa Hakko Kirin as a sublicensing fee.

Third Quarter 2015 Financial Highlights

AVEO ended Q3 2015 with $37.2 million in cash, cash equivalents and marketable securities.

Total collaboration revenue was approximately $15.2 million compared with $0.9 million for Q3 2014. The increase was primarily due to $15.0 million in revenue recognized in connection with the Company’s out-licensing agreement with Novartis, which was executed in August 2015.

Research and development (R&D) expense was $4.5 million compared with $8.5 million for Q3 2014. The decrease in R&D expense was primarily due to a reduction in personnel-related expenses following AVEO’s January 2015 strategic restructuring, the reduction of the Company’s leased facilities, as well as a decrease in external clinical trial and consulting costs associated with decreased clinical development activity and AV-380 preclinical development activity. This is offset by a $1.5 million increase in in-licensing expense associated with a milestone payment incurred upon signing the Company’s agreement with Novartis.

General and administrative (G&A) expense was $2.2 million compared with $5.1 million for Q3 2014. The decrease in G&A expense was primarily due to a reduction in external legal costs associated with various ongoing legal matters and a decrease in employee compensation, facilities and IT costs following the Company’s January 2015 restructuring and the reduction of its leased facilities.
Restructuring and lease exit expense was $0 for Q3 2015 compared with $1.4 million for Q3 2014. The expense incurred during Q3 2014 related to charges incurred following the partial termination of the Company’s 650 E. Kendall Street facility lease.

Net income for Q3 2015 was $7.9 million, or $0.14 per basic and diluted share compared with a net loss of $14.4 million or $0.28 per basic and diluted share for Q3 2014.

Updated Financial Guidance

AVEO believes that its cash resources would allow the Company to fund current operations through the fourth quarter of 2017. This estimate does not include payment of potential licensing milestones or the costs of conducting any contemplated clinical trials and assumes no milestone payments from the Company’s partners, additional funding from new partnership agreements, equity financings, debt financings or accelerated repayment thereof or further sales of equity under the Company’s ATM. In addition, AVEO cannot estimate the impact on its cash resources of a settlement of claims with the SEC. The timing and nature of activities contemplated for 2015 and thereafter will be conducted subject to the availability of sufficient financial resources.

On November 09, 2015 ArQule, Inc. (Nasdaq:ARQL) reported the results of preclinical and clinical studies focusing on tivantinib, ARQ 087, ARQ 092, and ARQ 751 (Press release, ArQule, NOV 9, 2015, View Source [SID:1234508101]). The data were presented at the AACR (Free AACR Whitepaper)-NCI-EORTC meeting on November 7th, 2015. The poster presentations can be accessed in the "Investor and Media" section of our website, www.arqule.com, under "Recent Data Presentations."

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For the first time, data from an exploratory sub-analysis of the MARQUEE trial with tivantinib in non-small cell lung cancer in patients with advanced disease and epidermal growth factor receptor (EGFR) mutations were presented. The data showed tivantinib, when added to erlotinib, increased progression-free survival to 13 months compared to 7.5 months in the erlotinib plus placebo arm. The sub-analysis included 109 patients of which 56 were in the combination tivantinib plus erlotinib arm of the trial. The data were highlighted in an AACR (Free AACR Whitepaper) press release and press conference.

"The data from the sub-analysis of the MARQUEE trial supports our focus on precision medicine," said Brian Schwartz, M.D., Head of Research and Development and Chief Medical Officer at ArQule. "Although the study did not meet its primary endpoint, this analysis is encouraging and offers evidence that tivantinib when dosed in a specific patient population can provide substantial benefit."

Additionally, the company presented pre-clinical and clinical data on its early stage proprietary pipeline that support ArQule’s efforts to address the needs of patients in therapeutic areas of high unmet need through precision medicine. Data presented on FGFR inhibitor, ARQ 087, demonstrate that FGFR2 dysregulation correlates with efficacy and supports the on-going phase 2 trial in intrahepatic cholangiocarcinoma. Similarly, data presented on AKT inhibitors, ARQ 092 and ARQ 751, demonstrate that both drugs inhibit AKT and provide strong rationale for further studies in patients harboring AKT1 and PI3K mutations.

"Data presented at this year’s AACR (Free AACR Whitepaper)-NCI-EORTC conference are part of ArQule’s translational effort to connect preclinical and clinical research and guide a true precision medicine endeavor," said Giovanni Abbadessa, Vice President of Clinical Development, Translational Medicine and Medical Affairs at ArQule. "Both ARQ 092 and ARQ 087 have shown single-agent activity in vitro, in vivo and in patients in cancers driven by genetic alterations of their respective targets, AKT and FGFR. In addition, these pre-clinical data find confirmation in the clinical results achieved by ARQ 087 and ARQ 092 in their respective phase 1 clinical trials in genetically-altered endometrial and breast cancer and in FGFR2-driven cholangiocarcinoma, respectively. Combinability data reported for both experimental drugs with standard therapies may allow even more development options for the future."

Precision Medicine

Tivantinib is enrolling in two biomarker-driven phase 3 trials, METIV-HCC and JET-HCC. ARQ 087 is enrolling in a biomarker-driven phase 2 trial in intrahepatic cholangiocarcinoma (iCCA) with FGFR translocations. ARQ 092 is enrolling in a phase 1b biomarker-driven trial in patients with AKT and PI3K activating mutations including patients with breast, endometrial and ovarian cancers.

About MET and tivantinib (ARQ 197)

Tivantinib is an orally administered, selective inhibitor of MET, a receptor tyrosine kinase, which is currently in Phase 3 clinical trials. In healthy adult cells, MET can be present in normal levels to support natural cellular function, but in cancer cells, MET can be inappropriately and continuously activated. When abnormally activated, MET plays multiple roles in aspects of human cancer, including cancer cell growth, survival, angiogenesis, invasion and metastasis. The activation of certain cell signaling pathways, including MET, has also been associated with the development of resistance to anti-EGFR (epidermal growth factor receptor) antibodies such as cetuximab and panitumumab.

Pre-clinical data have demonstrated that tivantinib inhibits MET activation in a range of human tumor cell lines and shows anti-tumor activity against several human tumor xenografts. In clinical trials to date, treatment with tivantinib has been generally well tolerated and has shown clinical activity in a number of tumors. Tivantinib has not yet been approved for any indication in any country.

In December 2008, ArQule and Daiichi Sankyo signed a license, co-development and co-commercialization agreement for tivantinib in the U.S., Europe, South America and the rest of the world, excluding Japan, China (including Hong Kong), South Korea and Taiwan.

About the AKT Pathway, ARQ 092 and ARQ 751

ARQ 092 and ARQ 751 are orally available, selective small molecule inhibitors of the AKT kinase. The AKT pathway when abnormally activated is implicated in multiple oncogenic processes such as cell proliferation and apoptosis. This pathway has emerged as a target of potential therapeutic relevance for compounds that inhibit its activity, which has been linked to a variety of cancers as well as to select non-oncology indications.

ARQ 092, the lead compound in ArQule’s AKT program, has completed Phase 1a clinical testing and has advanced into Phase 1b expansion testing in cohorts of patients with endometrial cancer, lymphoma and tumors harboring either AKT or PI3K mutations. A number of next-generation compounds in the Company’s AKT program are in early to late stages of pre-clinical development. The company plans to file an Investigational New Drug (IND) application by the end of 2015 for ARQ 751, a next generation AKT inhibitor.

About FGFR and ARQ 087

ARQ 087 is a multi-kinase inhibitor designed to preferentially inhibit the fibroblast growth factor receptor ("FGFR") family with demonstrated efficacy in FGFR2 amplified tumors. The FGFR pathway is disrupted in several ways in human cancer, thus providing numerous therapeutic targets for an inhibitor of this pathway. ARQ 087 has demonstrated inhibition of tumor growth and downstream signaling in vivo in tumors whose growth is driven by these targets.

Signals of single agent activity with this compound were observed in Phase 1a testing. Phase 1b expansion cohorts with ARQ 087 include patients with cholangiocarcinoma and adrenocortical tumors, as well as those with FGFR translocations, amplification and mutations. Clinical development of ARQ 087 has advanced into Phase 2 for intrahepatic cholangiocarcinoma ("iCCA") following the observation of two confirmed partial responses in this patient population in the Phase 1 portion of the program.

On November 8, 2015 Ignyta, Inc. (Nasdaq: RXDX) ("Ignyta"), a precision oncology biotechnology company, reported the exclusive license of worldwide rights relating to Eli Lilly and Company’s taladegib oncology development program in exchange for an upfront payment of $2.0 million in cash and the issuance to Lilly of approximately 1.2 million shares of Ignyta’s common stock (Press release, Ignyta, NOV 8, 2015, View Source [SID:1234509530]). Taladegib is a potent, orally bioavailable small molecule hedgehog/smoothened antagonist that has achieved clinical proof-of-concept and a recommended Phase 2 dose based on results from prior clinical studies. Ignyta also licensed exclusive worldwide rights to the topical formulation of taladegib, which is a late preclinical program being developed for the potential treatment of patients with superficial and nodular basal cell carcinoma.

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Concurrently with the license, Ignyta entered into a stock purchase agreement with Lilly under which Lilly will purchase a further 1.5 million shares of Ignyta common stock at a price of $20 per share in a private placement. Lilly has agreed not to sell or otherwise transfer any of the shares acquired from Ignyta until May 10, 2016, and Ignyta is required to register the resale of the shares issued to Lilly with the Securities and Exchange Commission (SEC) prior to such date.

Under the license agreement, Ignyta is obligated to pay to Lilly development and sales milestones related to taladegib products totaling up to approximately $38 million (a portion of which may be paid in Ignyta equity), along with royalties on net sales of taladegib products. Ignyta also granted back to Lilly exclusive rights to develop and commercialize taladegib-containing products in combination with certain Lilly compounds. Lilly is obligated to pay to Ignyta a royalty on net sales of such combination products it commercializes. Further financial terms were not disclosed.

"We are pleased to be working with Ignyta to further the development of taladegib and explore its potential to help patients across multiple tumor types," said Richard Gaynor, M.D., senior vice president, product development and medical affairs for Lilly Oncology. "Lilly continues to raise the bar on innovation by leveraging external relationships and expertise. Moreover, we are looking forward to working with Ignyta on potential combination therapies with other Lilly compounds."

"The exclusive license from Lilly of this clinical program with demonstrated compelling Phase 1 activity is well aligned with our strategic vision of developing first-in-class and/or best-in-class therapeutics that can potentially eradicate residual disease in precisely defined patient populations," said Jonathan Lim, M.D., Chairman and CEO of Ignyta. "This new targeted oncology program is a hedgehog/smoothened antagonist that complements our pipeline well and provides us with exciting potential monotherapy and combination therapy approaches across multiple solid tumor indications. We are grateful to Lilly for sharing Ignyta’s precision oncology vision and recognizing the strong strategic fit of taladegib with our pipeline and capabilities, which led to its $30 million investment in the company."

On November 08, 2015 Calithera Biosciences, Inc. (Nasdaq:CALA), a clinical stage biotechnology company focused on the development of novel cancer therapeutics, reported that it will announce new clinical data from the solid tumor expansion cohorts of its lead anti-cancer therapeutic candidate, CB-839, at the 2015 AACR (Free AACR Whitepaper)-NCI-EORTC International Conference on Molecular Targets in Boston, Massachusetts (Press release, Calithera Biosciences, NOV 8, 2015, View Source;p=RssLanding&cat=news&id=2110182 [SID:1234508340]). CB-839 is a potent, selective, orally bioavailable glutaminase inhibitor in phase I clinical trials. The data support earlier findings of the clinical activity, tolerability and unique mechanism of action of CB-839 in patients with solid tumors, as well as show one partial response according to RECIST criteria.

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The new data to be presented by Funda Meric-Bernstam, MD, from MD Anderson Cancer Center (Abstract #C49), demonstrate stable disease across a variety of tumor types, as well as a single agent partial response (PR, on study >5 months) in a renal cell carcinoma (RCC) patient. This patient showed a 32% reduction in target lesions by RECIST with generalized shrinkage of lymph node metastases. Among the fifteen evaluable patients with RCC, nine (60%) had stable disease lasting at least three cycles (63 days) or a partial response, with four patients remaining on study. Among efficacy-evaluable patients across a range of tumor types treated on the current dosing schedule of twice-daily with food, 22 of 50 patients (44%) experienced stable disease or better. Five stable disease patients currently on study have been treated with CB-839 for over 8 months without progression (2 triple negative breast cancer, 1 RCC, 1 mesothelioma and 1 IDH1 mutant chondrosarcoma).

"We are very encouraged by these findings in that they reinforce the published safety and efficacy profile of CB-839. We believe that this first partial response in solid tumors points to the potential of our novel agent’s efficacy in renal cell carcinoma, and we look forward to sharing data as our single agent and combination studies mature," said Susan Molineaux, PhD, President and Chief Executive Officer of Calithera. "We are currently expanding enrollment of CB-839 as a monotherapy in renal cell carcinoma patients, as well as dosing CB-839 in combination with everolimus."

The Phase 1 multi-center open label dose escalation study was designed to evaluate the safety and tolerability of CB-839 in locally advanced, metastatic and/or refractory solid tumors. Oral CB-839 was administered in doses of 100 mg to 1000 mg, in 21 day cycles using one of two regimens: TID or BID with food. As of October 1, 2015, 98 patients were enrolled in the solid tumor study (32 TID, 66 BID with food) and evaluable for safety; 77 were evaluable for efficacy. All future patients enrolled to the study will be dosed on the BID with food regimen.

Safety Data

Among 98 patients evaluable for safety, a maximum tolerated dose has not been established. CB-839 was generally well tolerated with the majority of treatment-emergent adverse events being mild to moderate, Grade 1/2 and reversible. Among patients in the BID with food regimen, 4.5% (3/66) experienced a Grade 3/4 adverse event suspected to be related to CB-839 and 3% discontinued due to drug-related adverse events (2/66). The rate of Grade 3 alanine aminotransferase (ALT) elevations of 1.5% (1/66) in the BID with food cohort was substantially reduced relative to that observed in the TID cohort 16% (5/32).

In addition, a preclinical poster was presented by Calithera’s collaborators. Details for the presentation are as follows:

Targeting glutamine metabolism in colorectal cancers with PIK3CA mutations

Abstract #C115
Zhenghe John Wang, Ph.D., Case Western Reserve University
Poster Session C