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Juniper Pharmaceuticals Reports Second Quarter 2016 Financial Results

On August 4, 2016 Juniper Pharmaceuticals, Inc. (Nasdaq: JNP) ("Juniper" or the "Company"), a women’s health therapeutics company, reported financial and other results for the three-month period ended June 30, 2016 (Press release, Juniper Pharmaceuticals, AUG 4, 2016, View Source;p=RssLanding&cat=news&id=2193006 [SID:1234514246]). Recent highlights include:

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· Product and service revenue increased 15% and 24%, respectively, versus the second quarter of 2015;

· Balance sheet remains strong;

Crinone (progesterone gel) approved in Japan under the brand OneCrinone;
· Completed enrollment of Phase 2b trial of COL-1077 10% lidocaine vaginal gel in women undergoing a minimally invasive pipelle-directed endometrial biopsy;

· Two Phase 1 studies of COL-1077 published in the international peer-reviewed medical journal Clinical Pharmacology in Drug Development;

· Phase 1 proof-of-concept study demonstrating the ability of Juniper’s intravaginal ring to successfully deliver the nine amino acid peptide leuprolide published in the influential peer-reviewed Journal of Controlled Release; and,

· Alicia Secor appointed President and CEO, and a director of the Company.

"I am very excited to join the Company, and congratulate the team on a strong second quarter," said Alicia Secor, Juniper’s President and CEO. "I look forward to building on this momentum as we work to transform Juniper into a leading, global, women’s health company."

"Strong growth of the ex-U.S. Crinone franchise and Juniper Pharma Services drove revenue up 16% to $11.9 million for the second quarter of 2016 versus the same period last year," said George O. Elston, Juniper’s Chief Financial Officer. "This solid year-to-date performance has enabled us to maintain a stable, healthy cash position while advancing our proprietary R&D programs."

"We are uniquely positioned to leverage our world-class service and platform capabilities to develop and commercialize important new therapeutics for women," Ms. Secor continued. "I look forward to advancing our current product candidates and expanding our portfolio to fulfill our mission to deliver value-added treatments that meet the unique and underserved healthcare needs of women."

The Company continues to expect to report top-line results of its recently-completed Phase 2b clinical trial of COL-1077 10% lidocaine bioadhesive vaginal gel this quarter and, assuming positive outcomes, to advance this candidate into Phase 3 in 2017.

If successful, COL-1077 is expected to fill an unmet need for pain management in women undergoing minimally-invasive gynecologic procedures. There are over seven million such procedures performed annually in the United States, with no standard of care for pre-treatment analgesia.

Juniper’s intravaginal ring ("IVR") programs continue to advance toward clinical development. The most advanced IVR product candidate is JNP-0101, an oxybutynin IVR for the treatment of overactive bladder in women. IND-enabling studies are underway including a study, defined in the Company’s pre-IND meeting with the FDA, to evaluate the pharmacokinetics of JNP-0101 in a representative animal model.

The Company is accelerating the Chemistry Manufacturing and Controls ("CMC") and production scale-up for JNP-0101 beyond its existing in-house capacity to further develop the go-to-market formulation and commercial manufacturing process ahead of its IND filing, which is now expected in 2017. This activity is intended to reduce CMC-related risks as JNP-0101 moves through clinical trials and toward commercialization in the $1.3 billion U.S. overactive bladder market.

Second Quarter Financial Results

Second quarter total revenues increased 16% to $11.9 million, compared with $10.2 million for the quarter ended June 30, 2015.

Product revenues were $7.6 million, an increase of $1.0 million, or 15%, versus the second quarter of last year, driven by continued in-market growth and new market sales of Crinone (progesterone gel) by Merck KGaA, Darmstadt, Germany.

Service revenues from Juniper Pharma Services were $3.4 million, an increase of $0.7 million, or 24%, versus the second quarter of last year, as we experienced continued strong growth in customer volume. Royalty revenues, based on Allergan’s sales of Crinone, were essentially unchanged at $0.9 million.

Gross profit increased to $5.4 million as compared with $4.6 million in the prior year quarter.

Total operating expenses were $7.2 million in the second quarter of 2016, a $2.2 million increase as compared to the prior year quarter.

Sales and marketing costs increased $0.1 million to $0.4 million in the second quarter of 2016, reflecting continued investment in the U.S. market by Juniper Pharma Services.

The $1.4 million increase in R&D spending as compared to the prior year quarter was predominantly driven by costs associated with the Phase 2b clinical trial of COL-1077. R&D expense also includes preclinical development costs for the IVR pipeline product candidates: JNP-0101 (oxybutynin IVR), JNP-0201 (estradiol + progesterone IVR for symptoms of menopause), and JNP-0301 (progesterone IVR for the prevention of preterm birth).

The $0.7 million increase in general and administrative costs as compared to the prior year quarter was primarily driven by the creation of an internal business development function that was not in place in 2015 along with costs associated with CEO succession and organizational growth.

Juniper recorded a net loss of $1.7 million, or $(0.16) per diluted share, in the second quarter of 2016, compared to a net loss of $0.3 million, or ($0.03) per diluted share, in the same period of 2015.

Liquidity

Cash and cash equivalents were $13.0 million as of June 30, 2016, versus $13.5 million at March 31, 2016 and $13.9 million at December 31, 2015. The decrease in cash and cash equivalents was primarily the result of capital expenditures.

Outlook

Based on year-to date revenues and expectations for the second half of the year, Juniper now anticipates full-year 2016 revenue growth in the low- to mid-teen percentage range over 2015 results.

Insmed Reports Second Quarter 2016 Financial Results

On August 4, 2016 Insmed Incorporated (Nasdaq:INSM), a global biopharmaceutical company focused on the unmet needs of patients with rare diseases, reported financial results for the quarter ended June 30, 2016 (Press release, Insmed, AUG 4, 2016, View Source [SID:1234514245]).

Business Update

Global phase 3 CONVERT study advancing on track. The company continues to expect patient enrollment in its phase 3 study of ARIKAYCE (liposomal amikacin for inhalation) to conclude in 2016. The study, which is known as CONVERT or INS-212, is evaluating ARIKAYCE in nontuberculous mycobacteria (NTM) lung disease caused by Mycobacterium avium complex (MAC). CONVERT is taking place in 18 countries and involves more than 145 sites. The primary efficacy endpoint is the proportion of subjects who achieve culture conversion at Month 6 in the ARIKAYCE plus multi-drug regimen arm compared to the multi-drug regimen without ARIKAYCE arm.
Data from phase 2 study of ARIKAYCE presented at the 1st World Bronchiectasis Conference. One-year follow-up data from the company’s phase 2 study of ARIKAYCE in patients with NTM lung disease were recently presented at the 1st World Bronchiectasis Conference in Hannover, Germany. The presentation was one of nine abstracts accepted for oral presentation.
Data from phase 1 clinical study of INS1009 to be presented at ERS 2016. Two abstracts have been accepted for presentation at the European Respiratory Society (ERS) International Congress taking place in London September 3-7. The posters are titled "Single dose pharmacokinetics of C16TR for Inhalation (INS1009) vs. treprostinil inhalation solution" and "Safety and pharmacokinetics study of a single ascending dose of C16TR for inhalation (INS1009)". The presentations will take place on Monday September 5. INS1009 is one of the company’s nebulized treprostinil prodrugs, which may offer a differentiated product profile with therapeutic potential in rare pulmonary disorders such as pulmonary arterial hypertension (PAH), idiopathic pulmonary fibrosis (IPF), pulmonary sarcoidosis, and severe refractory asthma.
US Patent strengthens global patent portfolio. The United States Patent and Trademark Office issued patent no. 9,402,845, which provides methods of treating pulmonary infections via inhalation administration of a formulation containing a liposomal quinolone antibiotic and free quinolone antibiotic, such as ciprofloxacin. For example, a method of treating a bronchiectasis patient for a Pseudomonas aeruginosa pulmonary infection with the formulation is provided. The patent complements ARIKAYCE’s global intellectual property estate and further solidifies Insmed’s position as an innovator of liposomal antibiotic technology for pulmonary disorders and infections.
"Our phase 3 CONVERT study is our top corporate priority and we anticipate concluding enrollment later this year," said Will Lewis, president and chief executive officer of Insmed. "Positive data from CONVERT are expected to support a broad global regulatory strategy and advance our goal of bringing ARIKAYCE to patients with NTM lung disease who are in great need of new therapeutic options."

Second Quarter Financial Results

For the second quarter of 2016, Insmed posted a net loss of $36.6 million, or $0.59 per share, compared with a net loss of $28.6 million, or $0.47 per share, for the second quarter of 2015.

Research and development expenses were $23.9 million for the second quarter of 2016, compared with $18.2 million for the second quarter of 2015. The increase was primarily due to the advancement of the company’s global phase 3 CONVERT study of ARIKAYCE in NTM lung disease.

General and administrative expenses for the second quarter of 2016 were $12.3 million, compared with $9.7 million for the second quarter of 2015. The increase was primarily related to pre-commercial activities, namely the buildout of the company’s infrastructure and NTM disease awareness activities, as well as an increase in headcount and related expenses.

Balance Sheet Highlights and Cash Guidance

"Observing the market changes from the beginning of the year, we are closely managing our operations resulting in cash operating expenses at the low end of our guidance for the first half of the year," said Andy Drechsler, chief financial officer of Insmed. "We continue to ensure that mission-critical priorities, such as the phase 3 CONVERT study and other key pre-commercial activities, are fully resourced. Given our solid cash position and disciplined approached to capital allocation, we expect to execute on our operational and strategic priorities."

As of June 30, 2016, Insmed had cash and cash equivalents of $223 million. Excluding depreciation and stock-based compensation expense, the company’s cash operating expenses for the six months ended June 30, 2016 were $59 million, which was at the low end of the company’s previously guided range of $58 to $68 million. Insmed ended the second quarter of 2016 with $25 million in debt and $197 million of working capital.

The company is investing in the following activities in 2016: (i) clinical development of ARIKAYCE, (ii) regulatory and pre-commercial initiatives for ARIKAYCE, and (iii) preclinical and clinical activities for its earlier-stage pipeline. Insmed expects its cash-based operating expenses for the second half of 2016 to be in the range of $62 to $72 million.

ImmunoGen Reports Fourth Quarter and Fiscal Year 2016 Financial Results and Provides Quarterly Business Update

On August 4, 2016 ImmunoGen, Inc. (Nasdaq: IMGN), a leader in the expanding field of antibody-drug conjugates (ADCs) for the treatment of cancer, reported an update on the Company’s progress and reported financial results for its fourth quarter and fiscal year ended June 30, 2016 (Press release, ImmunoGen, AUG 4, 2016, View Source [SID:1234514243]).

"With our lead candidate poised to enter Phase 3 and a portfolio of well-differentiated programs advancing behind it, I am excited to have joined the strong team managing ImmunoGen’s transition to a fully-integrated biotech company," stated Mark Enyedy, President and CEO. "We will build upon ImmunoGen’s leadership position in ADCs by focusing on four strategic priorities: complete development and commercialize mirvetuximab soravtansine, accelerate our earlier-stage portfolio, continue to drive innovation in ADCs for the treatment of cancer, and support new and existing partnerships. As we execute on these priorities, we will look to improve the efficiency of our operations and more effectively manage our cash position."

Mr. Enyedy continued, "We made significant progress on these priorities over the past three months, including meeting with the FDA to review the path to registration for mirvetuximab soravtansine and our proposed Phase 3 trial, FORWARD I. With the benefit of the guidance provided by the agency, we are moving ahead with the study as designed and expect to enroll our first patient before year end. Following successful dose escalation, we have also initiated a 35-patient, Phase 2 expansion cohort for mirvetuximab soravtansine in combination with Avastin as part of our FORWARD II trial. With the initiation of Phase 1 dose escalation for IMGN779 and the progression of IMGN632 into pre-IND testing, we continue to advance our earlier-stage candidates deploying our new IGN payload technology to broaden the range of ADC-treatable cancers. The progress with our product candidates and those of our partners demonstrates ImmunoGen’s continuing commitment to drive ADC innovation to improve the lives of patients with cancer."

Pipeline Updates

Mirvetuximab Soravtansine

Mirvetuximab soravtansine is a well-differentiated experimental therapy for the treatment of ovarian cancer and potentially other tumor types that express its target, folate receptor alpha (FRα). This ADC is being evaluated in clinical trials as a single-agent therapy for platinum-resistant ovarian cancer and in combination regimens for both platinum-resistant and platinum-sensitive disease.

Single-Agent Therapy

Held Type B meeting with the U.S. Food and Drug Administration (FDA) to review the path to registration for mirvetuximab soravtansine and the proposed FORWARD I study protocol. With the benefit of the agency’s guidance, ImmunoGen is moving forward with initiating this Phase 3 trial as previously outlined, including with the primary endpoint of progression-free survival (PFS).
Reported data from 46 patients with FRα-positive platinum-resistant ovarian cancer at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) meeting in June. Mirvetuximab soravtansine demonstrated robust single-agent activity in these patients, with the greatest response rates and PFS reported in patients with high or medium levels of FRα expression on their tumors and who had received up to three prior regimens, the patient population eligible for enrollment in FORWARD I.
Strategic Combination Regimens

Initiated the 35-patient Phase 2 assessment in FORWARD II of mirvetuximab soravtansine in combination with Avastin following successful completion of dose finding.
Continued enrollment in the FORWARD II cohorts assessing the ADC used with pegylated liposomal doxorubicin (PLD) and, separately, with carboplatin, with the cohort assessing the combination with Keytruda on track to open this summer.
Exploring Additional Opportunities

Through ImmunoGen’s collaboration with the National Comprehensive Cancer Network (NCCN), grants were awarded for clinical assessment of mirvetuximab soravtansine in combination with gemcitabine and as a treatment of triple negative breast cancer as well as for preclinical studies on mechanisms of resistance, sensitivity, and biomarkers.
IMGN779 / IMGN632

IMGN779 and IMGN632 deploy ImmunoGen’s new ultra-potent, DNA-acting payload agents that alkylate DNA without crosslinking it. In preclinical studies, these agents have been found to avoid the sustained toxicity seen with DNA-crosslinking agents.

Initiated Phase 1 clinical testing of IMGN779, a CD33-targeting ADC, for the treatment of AML. Initial clinical data from this trial are expected to be presented in 2017.
Advanced CD123-targeting IMGN632 into IND-enabling testing. The first preclinical findings with this novel ADC were presented at the European Hematology Association (EHA) (Free EHA Whitepaper) annual meeting, with additional data on its distinctive activity and tolerability expected to be presented in late 2016.
IMGN529

IMGN529 deploys ImmunoGen’s validated maytansinoid payload technology and recently gained orphan drug status in diffuse large B-cell lymphoma (DLBCL).

Initiated Phase 2 clinical testing of IMGN529 used in combination with Rituxan for patients with B-cell malignancies including DLBCL based on marked synergy in preclinical testing.
Fiscal Year 2016 Financial Results

ImmunoGen’s fiscal year 2016 ended June 30, 2016. The Company is moving to reporting on a calendar year basis, effective January 1, 2017.

For the Company’s fiscal year ended June 30, 2016 (FY2016), ImmunoGen reported a net loss of $143.7 million, or $1.65 per basic and diluted share, compared to a net loss of $60.7 million, or $0.71 per basic and diluted share, for its fiscal year ended June 30, 2015 (FY2015). For the quarter ending June 30, 2016, ImmunoGen reported a net loss of $44.8 million, or $0.51 per basic and diluted share, compared to a net loss of $30.5 million, or $0.35 per basic and diluted share, for the same quarter in FY2015.

Revenues in FY2016 were $60.0 million, compared to $85.5 million in FY2015, with the decrease principally due to reduced non-cash revenue from the amortization of upfront fees. FY2016 revenues include $26.9 million of license and milestone fees compared to $57.8 million in FY2015. The current period includes less revenue from the amortization of previously-received upfront fees than the prior period, $8.6 million and $41.4 million, respectively, and more revenue from partner milestone payments, $18.0 million and $14.0 million, respectively. Revenues in FY2016 also include $25.5 million of royalty revenues, all but $200,000 of which was non-cash, compared with $19.4 million for FY2015, of which $5.5 million was non-cash and $13.9 million was cash. Revenues for FY2016 also include $4.0 million of research and development support fees and $3.6 million of clinical materials revenue, compared with $2.8 million and $5.5 million, respectively, in such fees for FY2015. The changes reflect variations in the level of research support and the number of batches of clinical materials produced and released to partners on a year-to-year basis.

Operating expenses in FY2016 were $183.8 million, compared to $140.0 million in FY2015, with the increase principally due to costs associated with ImmunoGen advancing mirvetuximab soravtansine and other innovative, wholly-owned product candidates. Research and development expenses were $146.9 million in FY2016, compared to $111.8 million in FY2015. The increase in FY2016 is primarily due to increased clinical trial costs, particularly related to mirvetuximab soravtansine, to greater third-party costs related to ImmunoGen product program advancement, and to increased personnel expenses, principally due to hiring in the first three quarters of FY2016. General and administrative expenses were $36.9 million in FY2016, compared to $28.2 million in FY2015. This increase is primarily due to increased personnel expenses, particularly higher non-cash stock compensation costs which include a substantial charge resulting from the CEO transition, and to a lesser extent, increased third-party service fees.

ImmunoGen had approximately $245.0 million in cash and cash equivalents and $100.0 million of convertible debt outstanding as of June 30, 2016, compared with $278.1 million of cash and cash equivalents and no debt on June 30, 2015. Cash used in operations was $124.5 million in FY2016, compared with $55.3 million in FY2015. Capital expenditures were $10.4 million and $7.4 million for FY2016 and FY2015, respectively.

Financial Guidance

ImmunoGen is transitioning to a fiscal year ending December 31, effective January 1, 2017. For the six months ending December 31, 2016, ImmunoGen expects: revenues to be between $40 million and $45 million; operating expenses to be between $95 million and $100 million; net loss to be between $55 million and $60 million; cash used in operations to be between $65 million and $70 million; and capital expenditures to be between $2 million and $5 million. Cash and marketable securities at December 31, 2016 are anticipated to be between $170 million and $175 million.

Genocea Reports Second Quarter 2016 Financial Results

On August 4, 2016 Genocea Biosciences, Inc. (NASDAQ:GNCA), a biopharmaceutical company developing T cell-directed vaccines and immunotherapies, reported corporate highlights and financial results for the second quarter ended June 30, 2016 (Press release, Genocea Biosciences, AUG 4, 2016, View Source [SID:1234514241]).

"Full results from the Phase 2 dose optimization trial evaluating GEN-003, our immunotherapy for genital herpes, were showcased at ASM Microbe 2016 in June. The data show that a single course of treatment has significant and durable effects on both HSV-2 viral activity and genital herpes clinical disease for at least 12 months post dosing. Based on this clinical profile, we believe GEN-003 may offer benefits similar to a full year of daily administration of oral antivirals, giving us confidence in the potential for GEN-003 to become a cornerstone therapy for patients suffering with genital herpes," said Chip Clark, president and chief executive officer of Genocea. "We are looking forward to reporting viral shedding and six-month clinical efficacy data from our ongoing Phase 2b study of GEN-003 in September and around the end of this year, respectively."

Recent Business Highlights and Anticipated Milestones

GEN-003 – Immunotherapy for treatment of genital herpes in Phase 2 development. Greater than $1 billion potential revenue opportunity in U.S. alone

In June 2016, Genocea highlighted positive 12-month efficacy data from its Phase 2 dose optimization trial evaluating GEN-003 for the treatment of genital herpes at the American Society for Microbiology ("ASM") annual general meeting, ASM Microbe 2016. The study results, first announced in March 2016, demonstrate sustained and statistically significant reductions compared to baseline across multiple dose groups in the rate of viral shedding 12 months after treatment with GEN-003, as well as sustained efficacy at multiple dose levels across secondary endpoints measuring the impact on clinical disease. GEN-003 was well tolerated by patients, with no serious adverse events related to the vaccine in the trial.

Multiple anticipated upcoming clinical and regulatory milestones for GEN-003

Phase 2b viral shedding data expected in September
Phase 2b 6-month clinical efficacy data expected around the end of 2016
End-of-Phase 2 meeting with the U.S. Food and Drug Administration (FDA) expected in Q1 2017
Initiation of Phase 2 antiviral combination study in fourth quarter of 2016
In September, Genocea expects to report viral shedding data from an ongoing Phase 2b trial. Approximately 135 subjects have been randomized to one of three dose groups – placebo, 60 µg per protein / 50 µg of adjuvant and 60 µg per protein / 75 µg of adjuvant – and are being monitored for 12 months.

Around the end of 2016, Genocea expects to report 6-month clinical efficacy data from this Phase 2b trial. The placebo-controlled data will represent the first opportunity to measure GEN-003 against potential Phase 3 clinical endpoints at 6-months after dosing.

Following these two data readouts, Genocea expects to conduct an end-of-Phase 2 meeting with the FDA in the first quarter of 2017. During this meeting, the Company will confirm the Phase 3 program for GEN-003, which it expects to initiate in the second half of 2017.

Genocea also expects to commence a Phase 2b antiviral combination study in the fourth quarter of 2016. Six-month clinical efficacy data from this trial is expected in the second half of 2017. If GEN-003 is additive to the effect of chronic suppressive oral anti-viral therapy, the Company believes this would further strengthen GEN-003’s value proposition to patients and physicians.

Immuno-oncology collaborations and cancer vaccine strategy

Genocea continues to advance its collaborations with Memorial Sloan Kettering Cancer Center and Dana-Farber Cancer Institute and expects to announce further data from these collaborations together with an update on its internal cancer vaccine development strategy in the fourth quarter of 2016.

Expanded company leadership

John Bishop, Ph.D. joined as Senior Vice President of Pharmaceutical Sciences
Ron Cooper appointed to the Board of Directors
In May 2016, John Bishop, Ph.D. joined the company as senior vice president of pharmaceutical sciences. He was formerly at Momenta Pharmaceuticals Inc., where he was responsible for all aspects of chemistry, manufacturing, and controls across an array of development and commercial-stage products. In his new role at Genocea, Dr. Bishop will lead pharmaceutical sciences and manufacturing activities for all stages of product development and commercialization.

In June 2016, Ron Cooper joined the company’s board of directors. Mr. Cooper is currently president and chief executive officer of Albireo Ltd. (Albireo), a late-stage biopharmaceutical company developing therapeutics to treat orphan pediatric liver diseases. Prior to joining Albireo, he spent more than 25 years at Bristol-Myers Squibb, where he worked in five different countries and held positions of increasing responsibility in sales, marketing and general management, most recently as president of Europe.

Second Quarter 2016 Financial Results and Guidance

Cash Position: Cash, cash equivalents and investments as of June 30, 2016 were $86.0 million compared to $95.7 million as of March 31, 2016.
Research and Development (R&D) Expenses: R&D expenses for the quarter ending June 30, 2016 decreased $0.3 million, to $6.7 million, from the same period in 2015. The decrease was driven by the conduct of a smaller Phase 2 trial for GEN-003 in comparative quarterly periods and lower GEN-003 manufacturing costs due to the timing of activities in support of clinical trial supply. GEN-004 costs were also lower due to the Phase 2a trial which was ongoing in the second quarter of 2015 and has since been completed. These lower costs were partially offset by higher personnel and lab-related costs to advance Genocea’s preclinical product candidates and develop the ATLAS platform for immuno-oncology.
General and Administrative (G&A) Expenses: G&A expenses increased approximately $0.9 million to $4.0 million for the second quarter ending June 30, 2016 from $3.2 million for the same period in 2015. The increase was due largely to GEN-003 market research costs and higher depreciation costs from facility expansion.
Net Loss: Net loss was $11.0 million for the second quarter ended June 30, 2016, compared to a net loss of $10.3 million for the same period in 2015.
Financial Guidance: On the basis of Genocea’s current operating plans, including the planned commencement of Phase 3 trials for GEN-003 in the second half of 2017, Genocea expects that cash, cash equivalents, and investments will be sufficient to fund its operating expenses and capital expenditure requirements into the second half of 2017, assuming no receipt of proceeds from potential business development partnerships, equity financings or debt drawdowns.

Five Prime Announces Second Quarter 2016 Results and Provides Business Update

On August 4, 2016 Five Prime Therapeutics, Inc. (Nasdaq:FPRX), a clinical-stage biotechnology company focused on discovering and developing innovative immuno-oncology protein therapeutics, reported a corporate update and reported financial results for the second quarter ended June 30, 2016 (Press release, Five Prime Therapeutics, AUG 4, 2016, View Source [SID:1234514240]).

"We’re pleased with the progress we’ve made through the first half of the year and remain on track with our clinical programs," said Lewis T. "Rusty" Williams, M.D., Ph.D., president and chief executive officer of Five Prime. "At ASCO (Free ASCO Whitepaper) in June, we announced early but encouraging Phase 1 data for our FGFR2b antibody, FPA144, including confirmed partial responses in three of nine patients with FGFR2b+ gastric tumors and one confirmed complete response in a patient with bladder cancer. Notably, FPA144 recently received FDA Orphan Drug Designation in patients with FGFR2b+ gastric cancer. Development of our anti-CSF1R antibody, FPA008, now named cabiralizumab, is also progressing according to plan. We still expect the Phase 1b dose expansion portion of the trial combining cabiralizumab with OPDIVO (nivolumab) in multiple tumor types to begin during the second half of 2016. Also on track is our Phase 2 clinical trial of cabiralizumab in patients with pigmented villonodular synovitis (PVNS), a rare indication for which we received FDA Orphan Drug Designation."

Business Highlights and Recent Developments

Clinical Pipeline:

FPA008 (cabiralizumab): an investigational antibody that inhibits CSF1R and has been shown to block the activation and survival of monocytes and macrophages. In some cancers, macrophages suppress the immune system’s ability to kill cancer cells. In pigmented villonodular synovitis (PVNS), macrophages form the bulk of the tumor mass in joints. Cabiralizumab blocks the activation and survival of these cell types. Five Prime and Bristol-Myers Squibb (BMS) have an exclusive worldwide collaboration agreement for the development and commercialization of cabiralizumab.

Advanced Phase 1a/1b cabiralizumab/OPDIVO combination trial.
Five Prime continued dose exploration in the Phase 1a/1b clinical trial evaluating the safety, tolerability and preliminary efficacy of the immunotherapy combination of cabiralizumab with OPDIVO, BMS’s PD-1 immune checkpoint inhibitor. The trial is currently expected to enroll up to 280 patients and remains on target to move into Phase 1b during the second half of 2016.

Advanced clinical trial of cabiralizumab in patients with PVNS into Phase 2 in May.
Five Prime advanced cabiralizumab into the Phase 2 dose expansion portion of the ongoing Phase 1/2 trial in PVNS, a CSF-1 receptor-driven tumor. The Phase 2 portion is evaluating clinical measures including response rate, pain and range of motion in approximately 30 PVNS patients. The U.S. Food and Drug Administration (FDA) granted cabiralizumab Orphan Drug Designation for the treatment of PVNS. Five Prime estimates the U.S. prevalence for diffuse PVNS patients may be as high as 25,000 patients.

FPA144: an isoform-selective antibody in development as a targeted immuno-therapy for tumors that over-express FGFR2b, a splice variant of a receptor for some members of the fibroblast growth factor (FGF) family. FPA144 has been engineered for enhanced antibody-dependent cell-mediated cytotoxicity (ADCC) to increase direct tumor cell killing by recruiting natural killer (NK) cells.

In July, received FDA Orphan Drug Designation for FPA144 for the treatment of gastric cancer and cancer of the gastroesophageal junction in patients whose tumors overexpress FGFR2b.

Presented data from the ongoing Phase 1 trial of FPA144 in an oral session at the 2016 American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting in June.

FPA144 monotherapy demonstrated early evidence of anti-tumor efficacy in gastric cancer patients with FGFR2b protein overexpression from Part 1b and Part 2 of the trial. These heavily pre-treated patients had received between 1 and 6 prior therapies with a median of 2 prior therapies. The highlights of the data presented at ASCO (Free ASCO Whitepaper) include:

Efficacy as of the April 1, 2016 data cutoff:
3 confirmed partial responses (PRs) out of 9 gastric cancer patients treated (33%); 1 of these 3 PRs was confirmed after the data cutoff
7 of 9 gastric cancer patients with disease control (3 PRs + 4 stable disease), disease control rate (DCR) = 77%
12-week progression-free survival (PFS) in 6 of 9 gastric cancer patients (67%)
Median duration of treatment of 112 days (range 42-182 days), with 2 of 9 gastric cancer patients still on study
A patient with metastatic bladder cancer in the dose escalation portion of the trial in solid tumors achieved a confirmed complete response (CR)

In addition to the 3 PRs in gastric cancer noted above, there was an additional unconfirmed PR in the 10th gastric cancer patient with FGFR2b protein overexpression, whose scan became available after the data cutoff.
Safety as of the April 1, 2016 data cutoff:

No dose-limiting toxicities (DLTs); maximum-tolerated dose (MTD) was not reached
No treatment-related serious adverse events (SAEs)
The most common treatment-related AEs ( > 5%) were all grades 1 or 2: fatigue (22.5%), nausea (20%) and vomiting (12.5%)

Presented preclinical data for FPA144 at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting. FPA144 was featured in two presentations at the AACR (Free AACR Whitepaper) Annual Meeting in April 2016. Five Prime demonstrated that FPA144’s enhanced ADCC mechanism drives innate and adaptive immune responses in the tumor microenvironment, recruiting NK and T cells into the tumor. Additionally, FPA144 produced an additive effect on tumor growth inhibition when combined with PD-1 blockade. These pre-clinical findings suggest the therapeutic potential for a combination of FPA144 with a checkpoint inhibitor.

FP-1039: a protein drug designed to intervene in FGF signaling. As a ligand trap, FP-1039 binds to and neutralizes FGF ligands (such as FGF2), preventing these signaling proteins from reaching FGFR1 on the surface of tumor cells.

GSK presented data in mesothelioma patients from the ongoing Phase 1b trial of FP-1039 at the 2016 ASCO (Free ASCO Whitepaper) Annual Meeting.

Although GSK has terminated its FP-1039 license from Five Prime, GSK is continuing to conduct the ongoing study of FP-1039 in combination with 1st-line pemetrexed and cisplatin in patients with untreated, unresectable mesothelioma. GSK has now capped the trial at the 25 patients enrolled at the 15 mg/kg dose.

The trial data are not sufficiently mature for Five Prime to make decisions yet on potential future development of FP-1039 in mesothelioma. Those decisions will be based on our future assessment of the response rate and durability in this trial, as well as other considerations, such as drug supply and manufacturing.
Preclinical Research and Development:

Progressed internal immuno-oncology research programs. Five Prime continues to advance multiple immuno-oncology candidates through preclinical development and expects to have two programs entering pre-IND studies before the end of 2016. The company anticipates filing one IND by the end of 2017 and to have preclinical assets sufficient to keep the pace of one IND per year for the foreseeable future.

GSK licensed intellectual property for respiratory disease target identified using Five Prime’s proprietary protein discovery platform. In June, GSK exercised its option to take an exclusive license to the intellectual property related to a target under the 2012 respiratory diseases research collaboration between the companies. This triggered a $1.5 million license payment to Five Prime, which was recognized as revenue in the second quarter. Five Prime is eligible to receive up to $92.75 million in contingent milestone payments for each product that targets the licensed protein.
Summary of Financial Results and Guidance:

Cash Position. Cash, cash equivalents and marketable securities totaled $469.2 million on June 30, 2016, compared to $517.5 million on December 31, 2015. The decrease in cash was primarily attributable to cash used in operations to advance the FPA144 clinical trial, preclinical programs and tax payments.

Revenue. Collaboration revenue for the second quarter of 2016 increased by $2.9 million to $9.2 million from $6.3 million in the second quarter of 2015. This increase was primarily due to revenue recognized under the 2015 cabiralizumab collaboration agreement with BMS, under which Five Prime is reimbursed for the immuno-oncology trial expenses.

R&D Expenses. Research and development expenses for the second quarter of 2016 increased by $8.9 million, or 66.9%, to $22.2 million from $13.3 million in the second quarter of 2015. This increase was primarily related to advancing the FPA144 clinical trial, preclinical development and immuno-oncology research programs.

G&A Expenses. General and administrative expenses for the second quarter of 2016 increased by $3.5 million, or 76.1%, to $8.1 million from $4.6 million in the second quarter of 2015. This increase was primarily due to increases in cash and stock-based compensation expenses.

Net Loss. Net loss for the second quarter of 2016 was $13.1 million, or $0.49 per basic and diluted share, compared to a net loss of $11.5 million, or $0.45 per basic and diluted share, for the second quarter of 2015.

Shares Outstanding. Total shares outstanding were 28.3 million as of June 30, 2016.

Cash Guidance. Five Prime continues to expect full-year 2016 net cash used in operating activities to be less than $120 million, comprising less than $90 million used in operations and less than $30 million used for tax payments. The company estimates ending 2016 with approximately $400 million in cash, cash equivalents and marketable securities.