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Asterias Biotherapeutics Announces Successful End-of-Phase 2 Meeting with FDA for AST-VAC1

On February 24, 2016 Asterias Biotherapeutics, Inc. (NYSE:AST) reported the successful completion of an End-of-Phase 2 meeting with the U.S. Food and Drug Administration (FDA) for AST-VAC1, its investigational therapy targeting acute myeloid leukemia (AML) (Press release, BioTime, FEB 24, 2016, View Source [SID:1234509171]).

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During the meeting, the FDA indicated general agreement with Asterias’ proposed development plan for registration of AST-VAC1 through a single Phase 3 trial to support an accelerated development pathway and Biologics License Application (BLA) filing. In this study, Asterias will assess the impact of AST-VAC1 compared to placebo on the duration of relapse-free-survival as the primary endpoint, and on overall survival as the secondary endpoint in patients who have achieved complete remission using standard therapies. The proposed trial will include AML patients 60 years and older, along with younger individuals who are at high risk for relapse and are not candidates for allogeneic bone marrow transplantation. Pending positive results, this trial could be the basis for accelerated approval of AST-VAC1. Asterias currently plans to submit a request for a Special Protocol Assessment (SPA) to the FDA to confirm the primary endpoint and other design elements of this pivotal Phase 3 trial.

"We are very pleased with the outcome of the End-of-Phase 2 meeting and the feedback from our discussion with the FDA," stated Pedro Lichtinger, President and Chief Executive Officer. "We believe the results from the Phase 2 clinical trial of AST-VAC1 in AML are encouraging. We appreciate the valuable guidance that the FDA has provided us regarding the design and conduct of a Phase 3 registration program and look forward to further discussions in the Special Protocol Assessment process."

About Acute Myeloid Leukemia

Acute myeloid leukemia (AML) is a cancer of the blood and bone marrow. AML is the most common type of acute leukemia and has the potential for rapid progression, if untreated. In AML, the bone marrow produces an excess number of immature cells known as blasts. In AML, these blasts fail to mature into normal red and white blood cells. Instead, the blasts proliferate and accumulate in the bone marrow and peripheral blood, leading to deficiencies in normal mature cells. These deficiencies, often referred to as cytopenias, can induce several adverse effects including anemias and susceptibility to infections. Current treatment strategies for AML are associated with significant morbidities and in most instances, AML leads to death.

Approximately 20,500 new cases of AML are diagnosed in the U.S. annually. AML remains a high unmet clinical need, particularly in patients over the age of 60 years who face poor outcomes and have limited therapeutic options. Treatment and prognosis in AML is strongly influenced by a patient’s age and tumor profile. Successful treatment and survival of advanced age patients or those with a high risk profile is very poor, with a four year relapse-free survival of 10% – 20% (Rolig et al, 2011). Detailed characterizations of genetic abnormalities associated with AML have elucidated their high number and relative complexity, making development of targeted therapeutics to these mutations very challenging. For this reason, broad immunotherapy approaches such as autologous cell vaccines are particularly promising.

About AST-VAC1

AST-VAC1 is a cancer immunotherapy, consisting of autologous mature antigen-presenting dendritic cells pulsed with a messenger RNA for the protein component of human telomerase (hTERT) and a portion of a lysosomal targeting signal (LAMP). hTERT is a common protein in tumor cells and is responsible for the increased proliferative lifespan of cancer cells. In AST-VAC1, the dendritic cells present telomerase to the immune system to induce T cells to target and kill hTERT-expressing tumor cells. The LAMP signal allows AST-VAC1 to stimulate both cytotoxic and helper T cell responses to telomerase, critical elements to induce and maintain immune responses that kill tumor cells. In June 2015, Asterias announced long-term follow-up results from a Phase 2 clinical trial in AML patients receiving AST-VAC1. In this trial, twenty-one patients received at least three injections of AST-VAC1, including 19 patients in complete remission (CR). AST-VAC1 showed a strong safety profile in this trial and in a previous study in prostate cancer patients. Eleven of the 19 patients (58 percent) in the trial remain in CR with a median duration of follow-up of 52 months from first vaccination. Four of the seven patients who were at least 60 years old at the time of immunotherapy with AST-VAC1 remained relapse-free 52 to 59 months from first vaccination.

Because of the widespread expression of telomerase in the majority of cancers, AST-VAC1 is a platform immunotherapeutic that could be used alone or in conjunction with other therapeutics such as immune checkpoint inhibitors to target immune-based destruction of tumors.

About Accelerated Approval

The FDA instituted its Accelerated Approval Program to allow for earlier approval of drugs that treat serious conditions, and that fill an unmet medical need based on a surrogate endpoint. A surrogate endpoint is a marker, such as a laboratory measurement, radiographic image, physical sign or other measure that is thought to predict clinical benefit, but is not itself a measure of clinical benefit. The use of a surrogate endpoint can considerably shorten the time required prior to receiving FDA approval.

Drug companies are still required to conduct studies to confirm the anticipated clinical benefit. These studies are known as Phase 4 confirmatory trials. If the confirmatory trial shows that the drug actually provides a clinical benefit, then the FDA grants traditional approval for the drug. If the confirmatory trial does not show that the drug provides clinical benefit, FDA has regulatory procedures in place that could lead to removing the drug from the market.

Cancer Research UK launches trial for potential new drug that could help immune system fight cancer

On February 24, 2016 Cancer Research UK’s Centre for Drug Development (CDD), in partnership with Amgen Inc., reported that they have launched a new clinical trial to test a drug that could stop a patient’s immune system from protecting tumours (Press release, Cancer Research UK, FEB 24, 2016, http://www.cancerresearchuk.org/about-us/cancer-news/press-release/2016-02-24-cancer-research-uk-launches-trial-for-potential-new-drug-that-could-help-immune-system-fight-cancer [SID:1234509157]).

Cancer Research UK scientists are studying Amgen’s experimental cancer drug , called AMG319, to find out if it removes the defence shield that hides cancer cells from the immune system. It targets a protein called PI3K delta leading to destruction of the cancer cells when tested in the laboratory.

The Phase II trial, taking place at Poole Hospital, Southampton General Hospital, and the Clatterbridge Cancer Centre/Aintree University Hospital, looks at the effects of giving this drug to patients with a type of head and neck cancer known as squamous cell carcinoma (HNSCC), to determine whether it affects their immune response.

There will be around 54 patients with HPV-negative* HNSCC of the lower and upper parts of the throat (hypopharynx and oropharynx) or mouth in the study. Patients will be randomly assigned to receive either AMG319 or a placebo, during the regular break from treatment to avoid disruption to a patient’s care.

It is the 10th treatment to enter Cancer Research UK’s Clinical Development Partnerships (CDP) scheme.
CDP is a joint initiative between Cancer Research UK’s CDD and Cancer Research Technology, aiming to increase the number of cancer clinical trials and to progress promising anti-cancer agents by working in partnership with pharmaceutical companies.

Professor Christian Ottensmeier, trial lead from the University of Southampton and the Southampton Experimental Cancer Medicine Centre, said: "This is a really exciting trial because we’re using this drug in solid tumours for the first time. It also tries a whole new concept of cancer therapy in solid cancers for the first time. We hope that after taking the drug, patients will have more cancer fighting immune cells in their tumour. We will study in detail how the immune cells behave before and after AMG319 and whether they have become more effective."

Dr Emma King, clinical lead at the Poole Hospital, said: "I am really pleased that this trial gives our head and neck cancer patients and opportunity to get this new drug."

Tony Hoos, Vice president of Medical, Europe at Amgen, said: "The intersection of immunology and oncology represents one of the most promising approaches which may have a significant impact for patients with cancer today.

"We value the work that Cancer Research UK has done to make it possible to develop this promising drug to the next stage. This new trial will give us a better understanding of how AMG319 works, helping us learn more about its potential in patients who might benefit."

Dr Nigel Blackburn, Cancer Research UK’s director of drug development, said: "We’re delighted that the collaboration between Amgen and our Centre for Drug Development is moving into Phase II trials. It means we’re getting closer to providing a new treatment for cancer patients.

"Teaching the body’s immune system to fight cancer is a promising area of cancer research and we’re excited to see how this drug may help."

Baxalta Declares Quarterly Dividend

On february 23, 2016 The Board of Directors of Baxalta Incorporated (NYSE: BXLT) reported a quarterly cash dividend of $0.07 per share of common stock (Press release, Baxalta, FEB 23, 2016, View Source [SID:1234509188]). The quarterly dividend will be paid on April 1, 2016, to stockholders of record as of the close of business on March 10, 2016.

8-K – Current report

On February 23, 2016 Shire plc (LSE: SHP, NASDAQ: SHPG) (the "Company") reported on February 11, 2016, an interim dividend of 22.16 US cents per Ordinary Share payable on April 12, 2016, to shareholders on the register of members at the close of business on March 11, 2016 (Filing, 8-K, Shire, FEB 23, 2016, View Source [SID:1234509169]).

Shareholders are advised that recent developments in global tax law, namely the introduction of the Foreign Account Tax Compliance Act and the Common Reporting Standard, have introduced new reporting obligations relating to the Company’s Income Access Share arrangements ("IAS Arrangements"). These require that certain information relating to shareholders participating in the IAS Arrangements is reported to the appropriate tax authorities. In order to ensure the new reporting obligations are met, the Company is requesting from electing (or deemed electing) shareholders the relevant information via new IAS Arrangements election forms (and continuation forms in respect of joint holders). The relevant IAS Arrangements election forms together with an explanatory covering letter were posted to shareholders on February 16, 2016. In accordance with Listing Rule 9.6.1R, these documents were also uploaded to the National Storage Mechanism and are available for viewing. Internet links to the documents are also available on the Company’s website: www.shire.com

All shareholders who wish to receive, or continue to receive, UK sourced dividends via the IAS Arrangements (and therefore without incurring Irish dividend withholding tax) need to complete the new IAS Arrangements election forms and return to the address stated therein.

In order for submitted IAS Arrangements election forms to be valid in respect of the dividend to be paid on April 12, 2016, they need to be received by the Company’s Registrar, Equiniti, by 5pm (UK time) on March 11, 2016. Election forms received after this date will not be applied to this dividend though will be applied to future dividend payments.

Shareholders who do not elect to receive UK sourced dividends using the new IAS Arrangements election forms are advised that their dividends will be Irish sourced and therefore incur Irish dividend withholding tax, subject to applicable exemptions. If you are in any doubt as to what action to take, please consult your tax advisor immediately.

8-K – Current report

On February 23, 2016 Jazz Pharmaceuticals plc (Nasdaq: JAZZ) reported financial results for the full year and the fourth quarter of 2015 and provided financial guidance for 2016 (Filing, 8-K, Jazz Pharmaceuticals, FEB 23, 2016, View Source [SID:1234509162]).

"In 2015, we delivered solid growth on the top- and bottom-line while increasing investment in new growth opportunities for our current products and our promising R&D pipeline," said Bruce C. Cozadd, chairman and chief executive officer of Jazz Pharmaceuticals plc. "We look forward to 2016 as we focus on delivering growth of our key commercial products, preparing for our planned launch of defibrotide in the U.S., reaching important clinical milestones, including completing enrollment and determining preliminary results of our JZP-110 Phase 3 safety and efficacy studies, and potentially expanding our commercial and development portfolio through corporate development activities."

Adjusted net income attributable to Jazz Pharmaceuticals plc for 2015 was $600.1 million, or $9.52 per diluted share, compared to $520.5 million, or $8.31 per diluted share, for 2014. Adjusted net income attributable to Jazz Pharmaceuticals plc for the fourth quarter of 2015 was $163.5 million, or $2.60 per diluted share, compared to $151.1 million, or $2.40 per diluted share, for the fourth quarter of 2014.

GAAP net income attributable to Jazz Pharmaceuticals plc for 2015 was $329.5 million, or $5.23 per diluted share, compared to $58.4 million, or $0.93 per diluted share, for 2014. GAAP net income attributable to Jazz Pharmaceuticals plc for the fourth quarter of 2015 was $82.8 million, or $1.32 per diluted share, compared to $81.6 million, or $1.30 per diluted share, for the fourth quarter of 2014. Reconciliations of applicable GAAP reported to non-GAAP adjusted information are included in this press release.

2015 Revenues and Product Sales
Total revenues for the year ended December 31, 2015 were $1,324.8 million, an increase of 13% over total revenues of $1,172.9 million for the year ended December 31, 2014. Total revenues for the fourth quarter of 2015 were $340.9 million, an increase of 4% over total revenues of $328.1 million for the fourth quarter of 2014. The increase in total revenues was driven by higher net product sales of Xyrem (sodium oxybate) oral solution. Total revenues include net product sales, royalties and contract revenues.

Net product sales for 2015 and the fourth quarter of 2015 were as follows:
•
Xyrem: 2015 Xyrem net sales increased by 23% to $955.2 million compared to $778.6 million during the prior year. Xyrem net sales increased by 13% to $251.8 million in the fourth quarter of 2015 compared to $222.5 million in the fourth quarter of 2014.

• Erwinaze/Erwinase (asparaginase Erwinia chrysanthemi): 2015 Erwinaze/Erwinase net sales were $203.3 million compared to $199.7 million during the prior year. Erwinaze/Erwinase net sales were $50.4 million in the fourth quarter of 2015 compared to $52.8 million in the fourth quarter of 2014. Product sales volume for the full year and fourth quarter of 2015 increased

compared to the same periods in 2014; however, net sales were negatively impacted by higher chargebacks and rebates and unfavorable foreign currency exchange rates. In the fourth quarter of 2015, the company experienced supply challenges that disrupted the ability to fully supply certain markets.

• Defitelio (defibrotide): 2015 Defitelio/defibrotide net sales were $70.7 million compared to 2014 full year pro forma Defitelio/defibrotide net sales of $73.4 million. Defitelio/defibrotide net sales from the period beginning from the closing of its acquisition of Gentium S.r.l. on January 23, 2014 to December 31, 2014 were $70.5 million. Defitelio/defibrotide net sales were $18.5 million in the fourth quarter of 2015 compared to $19.2 million in the fourth quarter of 2014. Product sales volume for the full year and fourth quarter of 2015 was consistent with the company’s expectations and higher than the same periods in 2014, but net sales were impacted by unfavorable foreign currency exchange rates.

• Prialt (ziconotide) intrathecal infusion: Prialt net sales were $26.4 million in both 2015 and 2014. Prialt net sales were $6.5 million in the fourth quarter of 2015 compared to $10.0 million in the fourth quarter of 2014. Net sales in the fourth quarter of 2014 included shipments to Eisai Co., the European distributor of Prialt.

• Psychiatry products: 2015 net sales of the company’s psychiatry products were $37.1 million compared to $40.9 million in the prior year. Net sales of the company’s psychiatry products were $8.8 million in the fourth quarter of 2015 compared to $8.4 million in the fourth quarter of 2014.

• Other: 2015 net sales of other products were $24.1 million compared to 2014 full year pro forma net sales of other products of $47.0 million. Net sales of other products in the fourth quarter of 2015 were $3.0 million compared to $11.3 million in the fourth quarter of 2014. In March 2015, the company completed the sale of certain products and the related business that the company acquired as part of the acquisition of EUSA Pharma Inc. in 2012.

Tables showing actual net product sales for the three months and year ended December 31, 2015 and 2014 and pro forma net product sales for the year ended December 31, 2014 are included in this press release.

Operating Expenses and Other
Operating expenses for 2015 were $816.6 million compared to $977.3 million for 2014. Operating expenses for 2014 included acquired in-process research and development expenses of $202.6 million. Operating expenses for the fourth quarter of 2015 were $234.3 million compared to $198.2 million for the fourth quarter of 2014. Operating expenses changed over the prior year periods primarily due to the following:

• Cost of product sales for 2015 was $102.5 million compared to $117.4 million for 2014. Cost of product sales for the fourth quarter of 2015 was $24.0 million compared to $28.8 million for the same period in 2014. Gross margin for 2015 was 92.2% compared to 89.9% for 2014. Gross margin for the fourth quarter of 2015 was 92.9% compared to 91.1% for the same period in 2014.

• Selling, general and administrative (SG&A) expenses for 2015 on a GAAP basis were $449.1 million compared to $406.1 million for 2014. SG&A expenses for the fourth quarter of 2015 on a GAAP basis were $125.6 million compared to $105.7 million for the same period in 2014. Adjusted SG&A expenses for 2015 were $355.4 million, or 27% of total revenues, compared to $321.5 million, or 27% of total revenues, for 2014. Adjusted SG&A expenses for the fourth quarter of 2015 were $87.4 million, or 26% of total revenues, compared to $83.5 million, or 25% of total revenues, for the same period in 2014. The increases were primarily due to higher headcount and other expenses resulting from the expansion of the company’s business, except that the increase in GAAP SG&A expenses for the fourth quarter of 2015 compared to the same period in 2014 was primarily due to a one-time charge for settlement of a contract claim originally

asserted against Azur Pharma Public Limited Company (Azur Pharma) prior to the 2012 merger between Azur Pharma and Jazz Pharmaceuticals, Inc.

• Research and development (R&D) expenses for 2015 on a GAAP basis were $135.3 million compared to $85.2 million for 2014. R&D expenses for the fourth quarter of 2015 on a GAAP basis were $29.5 million compared to $24.6 million for the same period in 2014. Adjusted R&D expenses for 2015 were $96.7 million, or 7% of total revenues, compared to $71.8 million, or 6% of total revenues, for 2014. Adjusted R&D expenses for the fourth quarter of 2015 were $26.0 million, or 8% of total revenues, compared to $21.2 million, or 6% of total revenues, for the same period in 2014. The increases were primarily due to higher costs for clinical studies and outside services for the development of JZP-110 and line extensions for the company’s existing products, except that the increase in GAAP R&D expenses for full year 2015 compared to the same period in 2014 was primarily due to a $25.0 million milestone payment that was triggered by the acceptance for filing by the U.S. Food and Drug Administration (FDA) of the first new drug application (NDA) for defibrotide.

• Acquired in-process research and development expenses of $202.6 million in 2014 primarily related to upfront and milestone payments of $127.0 million made in connection with the acquisition of rights to JZP-110 and an upfront payment of $75.0 million made in connection with the acquisition of rights to defibrotide in the Americas.

• Impairment charges of $31.5 million in 2015 resulted from the termination of the suspended JZP-416 study. Impairment charges of $39.4 million in 2014 related to certain products we sold in March 2015 that we acquired as part of the EUSA acquisition.
Net interest expense in 2015 was $56.9 million compared to $52.7 million for 2014. Net interest expense for the fourth quarter of 2015 was $12.2 million compared to $16.7 million for the fourth quarter of 2014. In June 2015, the company refinanced its existing term loans and revolving credit facility and obtained more favorable interest rates, which reduced interest expense in the second half of 2015.

As of December 31, 2015, cash and cash equivalents were $988.8 million, and the outstanding principal balance of the company’s long-term debt was $1.3 billion. Cash and cash equivalents increased during 2015 primarily due to cash generated by the business.
During 2015, the company repurchased 0.4 million ordinary shares for $61.6 million at an average cost of $150.24 per ordinary share.