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Athersys Reports First Quarter 2016 Results

On May 05, 2016 Athersys, Inc. (Nasdaq:ATHX) reported its financial results for the three months ended March 31, 2016 (Press release, Athersys, MAY 5, 2016, View Source [SID:1234511972]).

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Highlights of the first quarter of 2016 and recent events include:

Announced positive one-year follow-up results from the Phase 2 study of MultiStem cell therapy to treat ischemic stroke – demonstrating progressive improvements and significantly higher rate of excellent outcomes at one year for MultiStem-treated patients – with greater benefits for patients receiving MultiStem treatment within 36 hours of the stroke;
Established collaboration with HEALIOS K.K. ("Healios") to develop MultiStem cell therapy for stroke in Japan, which included an upfront payment of $15 million, additional potential milestone payments aggregating up to $225 million, double-digit royalties on product sales and an option for Healios to expand the collaboration to include acute respiratory distress syndrome ("ARDS") and another indication with a $10 million expansion payment and additional associated milestone payments and royalties;
Advanced preparations for next stroke trials, including working with Healios to reach agreement with the Japanese Pharmaceuticals and Medical Devices Agency ("PMDA") on study design to potentially clear the way for a Japanese investigational new drug ("J-IND") filing and subsequent trial launch, and engaging with other regulators about requirements for the Company’s planned international stroke study;
Continued enrollment of Phase 2a study evaluating administration of MultiStem therapy to ARDS patients, and Phase 2 acute myocardial infarction ("AMI") study, evaluating and taking measures to accelerate enrollment;
Recorded revenues of $15.5 million for quarter ended March 31, 2016, reflecting the recognition of the $15.0 million license fee payment from Healios, and net income of $4.8 million; and
Ended the quarter with $30.4 million in cash and cash equivalents.
"We remain very excited about our ischemic stroke program," stated Dr. Gil Van Bokkelen, Chairman & CEO at Athersys. "As we have presented at several conferences, we have seen that MultiStem treatment has the potential to help ischemic stroke victims, especially those who can be treated within 36 hours following the stroke. We were especially pleased with the one-year follow-up results, which showed continued and significant functional improvement with MultiStem treatment. As a result, we are moving forward diligently with clinical development in Japan with our partner Healios, and with planning for a corresponding study in the United States and Europe, focused on MultiStem treatment within 36 hours of the stroke.

"Our partnership with Healios is off to a strong start," continued Dr. Van Bokkelen. "Building from our previous engagement with the PMDA and with our support, Healios has reached general agreement with the PMDA about trial design and requirements. Healios is preparing its J-IND filing and planning for the subsequent launch of its planned study, and we are engaged in manufacturing to support their clinical product requirements. Based on discussions with the PMDA, we believe that a successful trial in Japan could make contingent, or even full, approval possible, utilizing Japan’s progressive regulations for the development and approval of regenerative medicine products.

"We are also fully engaged in planning and preparing for an international ischemic stroke study focused in the United States and several European countries. Upcoming discussions with the U.S. Food and Drug Administration and other regulators will help us refine and finalize the trial design and complete trial preparations," noted Dr. Van Bokkelen.

"We are also enrolling our two grant-supported Phase 2 trials, in AMI and ARDS, although progress has been slower than we have anticipated," commented Dr. Van Bokkelen. "We have undertaken a number of actions to accelerate enrollment, including adding clinical sites. We believe that MultiStem cell therapy is well-suited to treat these acute conditions based on our preclinical and clinical experience to date, and we are motivated to move these studies forward expeditiously.

"We continue to focus on other important areas, including actively exploring partnering opportunities around multiple programs. Finally, we have a substantial effort underway in manufacturing and process development focused, first, on supplying our planned clinical studies, and second, on advancing our manufacturing platform and related capabilities to support high-volume, low-cost production important to commercialization," concluded Dr. Van Bokkelen.

First Quarter Results

For the three months ended March 31, 2016, total revenues were $15.5 million compared to $0.7 million in the same period in 2015, reflecting the recognition of $15.0 million in contract revenue from our Healios collaboration in the first quarter of 2016. Grant revenue was $0.3 million less in the first quarter of 2016 compared to the same period in 2015, and grant revenues may fluctuate from period to period based on the timing of grant-related activities and the award and expiration of new grants.

Research and development expenses increased to $6.7 million in the 2016 first quarter from $5.7 million in the 2015 first quarter, primarily due to increased clinical and preclinical development costs, including process development activities to support manufacturing. General and administrative expenses were relatively consistent at $2.0 million and $1.9 million for the three months ended March 31, 2016 and 2015, respectively.

We recognized net income for the three months ended March 31, 2016 of $4.8 million compared to net loss of $12.5 million for the same period in 2015. The $17.2 million net variance includes the impact of the $15.0 million Healios license revenue, the $0.3 million decrease in grant revenues, the $1.1 million increase in combined R&D and G&A expenses, a $3.4 million decrease in non-cash expense from the change in the fair value of our warrant liabilities, and a $0.2 million increase in net other income. Cash provided in operating activities was $7.3 million during the 2016 first quarter (reflecting $14.8 million of cash received from Healios), compared to $1.1 million in the 2015 first quarter (including $8.0 million of cash received from our former collaborator, Chugai Pharmaceutical Co., Ltd). As of March 31, 2016, we had $30.4 million in cash and cash equivalents, compared to $23.0 million at December 31, 2015.

Agios Reports First Quarter 2016 Financial Results

On May 05, 2016 Agios Pharmaceuticals, Inc. (NASDAQ:AGIO), a leader in the fields of cancer metabolism and rare genetic metabolic disorders, reported business highlights and financial results for the first quarter ended March 31, 2016 (Press release, Agios Pharmaceuticals, MAY 5, 2016, View Source;p=RssLanding&cat=news&id=2165400 [SID:1234511970]).

"We have been focused on executing against the important milestones we laid out in January, and I’m proud of the progress across both our cancer and rare genetic disorders programs to date," said David Schenkein, M.D., chief executive officer at Agios. "Notably, enrollment is complete ahead of schedule for the Phase 2 expansion cohort for the Phase 1/2 study of AG-221 in advanced AML. This achievement is crucial to getting this potential new therapy to patients as quickly as possible. Additionally, we are pleased that the first data from our Phase 2 DRIVE PK study of AG-348 will be presented at EHA (Free EHA Whitepaper) this June, along with the first data from the Phase 1 study of AG-519 in healthy volunteers."

FIRST QUARTER 2016 HIGHLIGHTS & RECENT PROGRESS

PKR Activators:

An abstract for the first data from DRIVE PK, a global Phase 2, open-label safety and efficacy trial of AG-348 in adult, transfusion-independent patients with pyruvate kinase (PK) deficiency has been accepted for presentation at the 21st Congress of the European Hematology Association (EHA) (Free EHA Whitepaper) in June 2016. An abstract for preclinical data for AG-348 in beta-thalassemia has also been accepted for presentation at EHA (Free EHA Whitepaper).
Three abstracts on AG-519, including from the Phase 1 study in healthy volunteers and preclinical findings on the molecule, have been accepted for presentation at EHA (Free EHA Whitepaper).
Agios provided the following updates on its clinical development programs in collaboration with Celgene:

IDH Mutant Inhibitors in Hematologic Malignancies:

Completed enrollment of the Phase 2 expansion cohort for the Phase 1/2 study of AG-221 in patients with R/R AML in May 2016
Initiated a Phase 1/2 frontline combination study of AG-221 or AG-120 with VIDAZA (azacitidine) in newly diagnosed AML patients not eligible for intensive chemotherapy in March 2016
Received EMA Orphan Drug Designation for AG-221 for the treatment of AML in April 2016
Cancer Metabolism Research:

In April, Agios published preclinical findings from its program focused on MTAP (methylthioadenosine phosphorylase) deleted cancers in the peer-reviewed journal Cell Reports
2016 EXPECTED MILESTONES IN CANCER METABOLISM PROGRAMS

IDH Mutant Inhibitors in Hematologic Malignancies:

Complete enrollment of the 125-patient expansion cohort for the Phase 1 study of AG-120 in patients with R/R AML in the second half of 2016
Initiate a global, registration-enabling Phase 3 study of AG-120 in frontline AML patients with an IDH1 mutation in the second half of 2016
Initiate an expansion arm in high-risk myelodysplastic syndrome patients for AG-221 in 2016
Continue to enroll patients in the following ongoing clinical trials:
Phase 3 IDHENTIFY study of AG-221 vs. standard of care chemotherapy in R/R AML
Phase 1b frontline combination study of AG-221 or AG-120 with standard-of-care intensive chemotherapy in AML
Phase 1/2 frontline combination study of AG-221 or AG-120 with VIDAZA in AML
Phase 1 dose-escalation and expansion study of AG-881 in IDH mutant positive hematologic malignancies
IDH Mutant Inhibitors in Solid Tumors:

Present data from the expansion phase of the ongoing Phase 1 study of AG-120 in advanced IDH1 mutant positive low-grade glioma in the second half of 2016
Initiate a randomized Phase 2 study of AG-120 in IDH1 mutant positive cholangiocarcinoma in the second half of 2016
Continue to enroll patients in the following ongoing clinical trials:
Expansion phase of the ongoing Phase 1 study of AG-120 in advanced IDH1 mutant positive solid tumors
Phase 1 dose-escalation and expansion study of AG-881 in IDH mutant positive solid tumors
Cancer Metabolism Research:

Initiate preclinical development activities for the first molecule in the MTAP program in 2016
2016 EXPECTED MILESTONES IN RARE GENETIC METABOLIC DISORDERS PROGRAMS

Present new findings from the Natural History Study of PK deficiency being conducted with Boston Children’s Hospital in the second half of 2016
Outline the clinical development plans for Agios’ PKR activators in beta-thalassemia in the second half of 2016
FIRST QUARTER 2016 FINANCIAL RESULTS

Cash, cash equivalents and marketable securities as of March 31, 2016 were $355.8 million, compared to $375.9 million as of December 31, 2015. The decrease was driven by cash expenditures to fund operating activities of $54.1 million, which was offset by funding of $35.1 million from Celgene during the quarter ended March 31, 2016 related to our collaboration agreements.

Collaboration revenue was $31.3 million for the quarter ended March 31, 2016, compared to $34.2 million for the comparable period in 2015. In the first quarter of 2016, the Company received and recognized as revenue $25.0 million related to a substantive clinical development milestone for the AG-221 program.

Research and development (R&D) expense was $44.0 million, including $5.5 million of stock-based compensation expense, for the quarter ended March 31, 2016, compared to $32.4 million, including $2.6 million in stock-based compensation expense, for the quarter ended March 31, 2015. The increase in R&D expense was primarily due to increased costs to support advancement of the company’s lead investigational medicines toward later-stage development. Celgene is responsible for all development costs for AG-221 and certain development costs for AG-120 and AG-881 and reimburses the company for development costs incurred for these investigational medicines.

General and administrative (G&A) expense was $10.8 million, including $3.6 million of stock-based compensation expense, for the quarter ended March 31, 2016, compared to $7.0 million, including $2.4 million of stock-based compensation expense, for the quarter ended March 31, 2015. The increase in G&A expense was largely due to increased headcount and other professional expenses to support growing operations.

Net loss for the quarter ended March 31, 2016 was $23.2 million, compared to a net loss of $5.0 million for the quarter ended March 31, 2015.

Acceleron Pharma Reports First Quarter 2016 Financial and Operational Results

On May 5, 2016 Acceleron Pharma Inc. (NASDAQ:XLRN), a clinical stage biopharmaceutical company focused on the discovery and development of novel therapeutic candidates that engage the body’s ability to rebuild and repair its own cells and tissues, reported a corporate update and reported financial results for the first quarter ended March 31, 2016 (Press release, Acceleron Pharma, MAY 5, 2016, View Source [SID:1234511968]).

"In the first quarter, we continued to build momentum across our entire clinical pipeline, including the start of patient recruitment into our Phase 3 trials of luspatercept in MDS and beta-thalassemia with our partner Celgene," said John Knopf, Ph.D., Chief Executive Officer of Acceleron. "Receipt of the $15 million luspatercept milestone payment and the $140.3 million in net proceeds from our equity follow-on offering in January secured our ability to accelerate the pace of development of our wholly owned programs. To that end, we made significant progress toward the planned Phase 2 trial initiation of ACE-083 in facioscapulohumeral muscular dystrophy in the second half of 2016 and advancing our preclinical work in the area of fibrosis as well as the generation of new product candidates with our IntelliTrap platform."

FIRST QUARTER 2016 HIGHLIGHTS

Development Programs

Hematology

Acceleron received a $15 million milestone payment from collaboration partner Celgene related to the initiation of the luspatercept Phase 3 clinical trials. Luspatercept is being studied in two Phase 3 clinical trials in patients with myelodysplastic syndromes (MDS) or beta-thalassemia, both rare hematologic diseases.
Enrollment is ongoing for both of the Celgene-partnered Phase 3 studies of luspatercept. The MEDALIST trial in MDS is evaluating the efficacy and safety of luspatercept versus placebo in patients with anemia due to very low, low, or intermediate-risk MDS with ring sideroblasts (≥ 15%) who require red blood cell transfusions. The BELIEVE trial in beta-thalassemia is evaluating the efficacy and safety of luspatercept versus placebo in adults who require regular red blood cell transfusions. Luspatercept increases hemoglobin levels and is being developed to help patients reduce or eliminate their need for red blood cell (RBC) transfusions. Luspatercept has been granted Fast Track Designation from the FDA in both indications.
Ongoing Phase 2 trials of luspatercept in MDS and beta-thalassemia continue to generate longer-term safety and efficacy data. The Company expects to report updated results for these trials at the 21st Congress of the European Hematology Association (EHA) (Free EHA Whitepaper) in June 2016.
Enrollment is underway in two additional Phase 2 patient cohorts evaluating luspatercept in low- or intermediate-risk MDS patients who are ring sideroblast negative or are eligible but have not yet received an erythropoietin-stimulating agent (ESA). Initial data from these additional MDS patient cohorts are expected by year-end.
Musculoskeletal Diseases

ACE-083 advancing toward the initiation of a Phase 2 trial in facioscapulohumeral muscular dystrophy (FSHD), a neuromuscular disorder, in the second half of 2016. ACE-083 is a locally acting agent designed to increase muscle mass and strength in the muscles in which it is administered.
We continue to make progress with ACE-2494 toward IND submission. ACE-2494, Acceleron’s first IntelliTrap molecule, is a systemic therapeutic designed to increase muscle mass and strength across a range of musculoskeletal diseases. Preclinical data in mice presented in 2015 showed that after 4 weeks of treatment, ACE-2494 generated substantial dose-dependent mean increases in muscle mass: 41% in rectus femoris, 53% in gastrocnemius, and 87% in pectoralis.
Oncology

Enrollment continues in Part 2 of the Phase 2 DART study, a randomized, double-blind study of dalantercept plus axitinib, compared to placebo plus axitinib in patients with advanced renal cell carcinoma. Dalantercept has been granted FDA Fast Track Designation for this indication.
Nephrology

Acceleron and Celgene assessing the opportunity for the development of sotatercept in the pre-dialysis chronic kidney disease (CKD) setting, and expect to provide an update in the second half of the year.
Corporate Updates

Raised $140.3 million of net proceeds in a follow-on public offering of common stock in January 2016 to advance wholly owned programs.
Financial Results

Cash position – Cash, cash equivalents and investments as of March 31, 2016 were $278.7 million. Net cash provided by operating activities in first quarter 2016 was $0.9 million. As of December 31, 2015 the Company had cash, cash equivalents and investments of $136.0 million. We believe that our existing cash, cash equivalents and investments, including the net proceeds of $140.3 million from our January 2016 common stock offering and the receipt of the $15.0 million Celgene milestone, will be sufficient to fund our projected operating requirements into the second half of 2019.
Revenue – Collaboration revenue for the first quarter was $18.2 million. License and milestone revenue was $15.1 million and includes the $15 million milestone payment received from Celgene related to luspatercept. Cost sharing reimbursement revenue from our Celgene partnership was $3.1 million and is related to expenses incurred by the Company in support of our partnered programs.
Costs and expenses – Total costs and expenses for the first quarter were $22.1 million. This includes R&D expenses of $16.2 million and G&A expenses of $5.9 million.
Other income, net – Other income for the first quarter was $9.0 million and includes an $8.7 million, non-cash, gain on marking our common stock warrant liability to market.
Net income – The Company posted a net income for the first quarter ended March 31, 2016 of $5.1 million.

Pipeline: AMG 714

AMG 714 is a human monoclonal antibody that binds to Interleukin-15 (IL-15), a cytokine molecule appearing early in the cascade of events that ultimately leads to inflammatory disease (Company Pipeline, Genmab, MAY 5, 2016, View Source [SID:1234511965]). AMG 714 was created by Genmab, as HuMax-IL15, under a collaboration with Amgen. Amgen has sub-licensed AMG 714 to a private company, Celimmune, LLC. Celimmune is developing AMG 714 for nonresponsive and refractory celiac disease.

Celimmune: License to Drive Innovation

As part of its disciplined approach to funding innovation, Amgen carefully evaluates each internal program to determine which ones will receive much-coveted development funding (Company Web Page, Amgen, MAY 5, 2016, View Source [SID:1234511964]). Occasionally, a program will come along that does not make Amgen’s resource allocation cut in their intended indication but shows great promise in other areas. This presents a dilemma. Does Amgen provide more funding to explore this new promising area? Or, does Amgen put this asset in the hands of a committed outside party? In one recent deal, Amgen found some middle ground. When a particular molecule showed promise outside its intended area, an external team committed to moving it forward was located, while Amgen holds an option to take it back at a later stage. This is how startup company Celimmune came to develop AMG 714.

A New Direction for AMG 714
AMG 714 is an anti-IL-15 monoclonal antibody that, following a series of rheumatoid arthritis and psoriasis studies, Amgen deprioritized. But there was a scientist outside of Amgen who hadn’t forgotten about anti-IL-15. Dr. Francisco Leon, a leading expert in the development of therapeutics for celiac disease, had been following this antibody and a growing body of scientific literature suggesting IL-15’s central role in refractory celiac disease and non-responsive celiac disease. Dr. Leon believed AMG 714 was a ready tool to test the hypothesis that blocking IL-15 could benefit celiac patients.

Praise in Partnership
Intrigued, Amgen struck an agreement with Celimmune, where Dr. Leon serves as CEO and chief medical officer. Amgen has licensed AMG 714 to Celimmune, which has rights to develop, manufacture and commercialize AMG 714 on a worldwide basis excluding Japan. In connection with the license, Celimmune granted Amgen an exclusive option to acquire Celimmune, and thus to reacquire AMG 714, upon completion of certain clinical studies in patients with celiac disease. "We do not hesitate in going on record to speak to the ‘best-in-industry’ licensing and post-transactional alliance management support we have been so privileged to experience to date with Amgen," said Ashleigh Palmer, Executive Chairman, Celimmune weeks after the deal’s completion.

"Dr. Leon’s conviction was so strong and his credentials so compelling, we couldn’t help but take notice," said Jeremy Grunstein, an executive director from Amgen’s Business Development team. "Celimmune provided not only an avenue to test this important hypothesis, but also a mechanism for Amgen to reprioritize the program in its pipeline. It’s the kind of deal structure we’d like to replicate."

Celiac disease is a chronic hereditary systemic autoimmune and inflammatory disease triggered by gluten consumption, which can cause gastrointestinal dysfunction and debilitating symptoms including nutritional malabsorption. Celimmune plans to initiate Phase 2 studies of AMG 714 for the treatment of diet non-responsive celiac disease and type II refractory celiac disease (RCD-II), an in situ small bowel T-cell lymphoma.

Dr. Leon stated, "Celiac disease is the only common autoimmune disease without any approved medication. Published literature demonstrates that a gluten-free diet is not a solution for the majority of patients. As such, Celimmune is delighted to have an opportunity to license an experimental therapeutic that will test one of the main hypotheses in the pathophysiology of celiac disease, namely that IL-15 plays a central role in RCD-II and non-responsive celiac disease."

Ashleigh Palmer, Celimmune’s Executive Chairman, concurred, "AMG 714 could be the first drug to market for a celiac indication and there’s room for growth. In addition to celiac, AMG 714 could have longer-term expansion and life cycle management opportunities within adjacent gastrointestinal autoimmune diseases."

With this deal, Amgen is still making a bet on external innovation, but with science that originated from within Amgen.

"This deal is win-win-win. If Celimmune is successful, both parties will be rewarded and most importantly, patients will be one step closer to the first medicine available for celiac disease," said Grunstein.