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Biodesix Announces Third Quarter 2023 Results and Highlights

On November 7, 2023 Biodesix, Inc. (Nasdaq: BDSX), a leading diagnostic solutions company with a focus in lung disease, reported its financial and operating results for the third quarter ended September 30, 2023 and provided a corporate update (Press release, Biodesix, NOV 7, 2023, View Source [SID1234637122]).

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"I am pleased to announce yet another impressive quarter of growth at Biodesix," said Scott Hutton, President and Chief Executive Officer. "The team delivered over 10,400 Lung Diagnostics tests, growing 60% over the 6,500 tests delivered in the third quarter of 2022, the fifth straight quarter of at least 60% year-over-year growth, and 6% improvement over second quarter 2023. Our Biopharma Services business also had a strong quarter, growing 79% year-over-year and 181% over the second quarter. I am thrilled with Biodesix’s ability to consistently grow the business while maintaining a strong cost disciplined approach. Starting this quarter, we are now providing Adjusted EBITDA to provide additional insight into our progress toward profitability. Our third quarter Adjusted EBITDA was ($5.4) million, a 40% improvement over both the third quarter of 2022 and the second quarter of 2023. In the fourth quarter we are continuing to improve our balance sheet with the final closing of our private placement announced in August and plan to draw down an additional $10 million from the second tranche of our term loan with Perceptive Advisors. I am exceptionally pleased with our progress as we continue to increase test volumes, drive revenue growth, advance operational effectiveness, and improve Adjusted EBITDA as we strive to impact more patients with lung disease than ever before."

Third Quarter 2023 Financial Results

For the three-month period ended September 30, 2023, as compared to the same period of 2022 (where applicable):

Total revenue of $13.5 million, an increase of 21%, including COVID testing revenue in third quarter 2022, driven primarily by strong year-over-year growth in lung diagnostics, and a 37% year-over-year increase excluding COVID testing revenues from the prior year comparison;
Lung diagnostic revenue of $12.3 million reflected a year-over-year increase of 34% driven primarily by the continued adoption of Nodify Lung nodule risk assessment tests, and approximately 60% when excluding one-time cash revenue from tests performed in prior periods primarily from Medicare coverage of the Nodify CDT test;
Biopharma Services and other revenue of $1.2 million increased 79% year-over-year, a result of both delivering against our increasing book of business and new agreements;
COVID-19 testing revenue decreased by 100% year-over-year, as the Company no longer provides COVID-19 diagnostic testing services;
Third quarter 2023 gross profit of $10.3 million, or 76% gross margin compared to 67% gross margin in the comparable prior year period, primarily driven by growth in Lung Diagnostic Testing and optimization of testing workflows that resulted in improvements in costs per test, the ongoing recovery of our Biopharma Services business, and the commercial discontinuation of our lower-margin COVID-19 diagnostic testing;
Operating expenses (excluding direct costs and expenses) of $17.4 million, a decrease of approximately $0.7 million, or 4% as compared to the third quarter 2022 (includes non-cash stock compensation expense of $1.0 million as compared to $1.2 million). This decrease is primarily attributable to a decrease in research and development costs, partially offset by increased sales and marketing costs to support lung diagnostic sales growth to enhance product awareness and drive adoption;
Net loss of $10.9 million, a decrease of approximately $2.8 million, or 20%;
Adjusted EBITDA was a loss of $5.4 million, an improvement of $3.6 million, or 40%;
Cash and cash equivalents of $19.8 million as of September 30, 2023, an increase of $2.4 million from June 30, 2023;
The Company plans to draw down an additional $10 million from the second tranche of its $50 million term loan facility with Perceptive Advisors in the fourth quarter of 2023, subject to the terms and conditions of such facility;
Cash balance includes $15.3 million of the $27.5 million private placement announced in August. The remaining $12.2 million will be received in the fourth quarter of 2023.
2023 Financial Outlook

Third quarter revenues were impacted by a change in the timing and assumptions regarding the anticipated collection of revenue from a backlog of previously unrecognized Medicare Advantage claims. Based on these new assumptions, the Company is adjusting its 2023 financial outlook to remove the backlog and is not making any change to core business expectations. The Company expects to generate $50 to $52 million in total revenue in 2023.

Conference call and webcast information

Listeners can register for the webcast via this link. Analysts wishing to participate in the question-and-answer session should use this link. A replay of the webcast will be available via the Company’s investor website approximately two hours after the call’s conclusion. Those who plan on participating are advised to join 15 minutes prior to the start time.

For a full list of Biodesix’s press releases and webinars, please visit biodesix.com.

BeyondSpring Presents Poster Highlighting Preclinical and Clinical POC Immunomodulating Activity of Plinabulin Inducing Dendritic Cell Maturation and Re-sensitization in Immunotherapy Refractory Tumors when Combined with Radiation and PD-1/PD-L1 Inhibitors

On November 7, 2023 BeyondSpring Inc. (NASDAQ: BYSI) ("BeyondSpring" or the "Company"), a global clinical-stage biopharmaceutical company focused on using a groundbreaking technology platform for drug discovery and developing innovative therapies to improve clinical outcomes for patients with high unmet medical needs, reported new data that translates preclinical proof-of-concept to clinical evidence of plinabulin’s immunomodulating activity (Press release, BeyondSpring Pharmaceuticals, NOV 7, 2023, View Source;utm_medium=rss&utm_campaign=beyondspring-presents-poster-highlighting-preclinical-and-clinical-poc-immunomodulating-activity-of-plinabulin-inducing-dendritic-cell-maturation-and-re-sensitization-in-immunotherapy-refractory-tumor [SID1234637121]). BeyondSpring and MD Anderson presented the data at the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper)’s (SITC) (Free SITC Whitepaper) 38th Annual Meeting on Nov 4th in San Diego, CA on an open-label, Phase 1 basket study at The University of Texas MD Anderson Cancer Center in cancer patients after progressing on PD-1, PD-L1 and/or CTLA-4 antibodies (NCT04902040) in six cancer types.

Based on preclinical models, where plinabulin plus radiation and anti-PD-1 antibody enhances dendritic cell (DC) activation, T-cell proliferation, and abscopal effect, a clinical study was initiated to test these findings. At the Phase 1 data cut-off (August 31, 2023), 19 heavily pretreated patients with 6 different cancers were exposed to plinabulin (30 mg/m2) after radiation initiation to an amendable lesion (3-6 hours apart) plus anti-PD-1 antibody, including pembrolizumab or nivolumab. 11 out of 14 patients eligible for efficacy assessment per RECIST criteria and had measurable target lesion responses in the non-irradiated tumor lesion. Disease control rate evaluates the tumor reduction in non-irradiated tumor to assess abscopal effect from immune agents.

80% DCR (disease control rate) in non-irradiated tumor: In 10 immunotherapy-refractory patients of 6 different cancers (Hodgkin Lymphoma, NSCLC, SCCHN, Merkel Cell Carcinoma, RCC, Fibrolamellar HCC), plinabulin triple combination is safe and yields encouraging response with 80% disease control rate (3 PR, 5 SD, 2 PD).
Durable Response in heavily pre-treated patients: 2 Hodgkin’s lymphoma patients who progressed after 12 or 16 prior lines of therapy respectively, had durable responses with one PR and one SD. These patients continued treatment after data cutoff.
DC maturation in responding patients: Plinabulin administered after radiation initiation induces an early systemic immune response (detectable 3 days later) in subsets of peripheral blood DC and monocytes in patients with clinical benefits (PR+SD).
Plinabulin mediates GEF-H1-dependent immune activation in responding patients: In patients with PR+SD, tumor scRNAseq analysis indicates GEF-H1-dependent immune activation in subsets of DC and monocyte-derived macrophages. Such activation was not seen in patients with PD.
Additional biomarker analyses at baseline and post-treatment are underway.
"There are severe unmet medical needs for cancer patients who progress on immunotherapies. We have been studying Plinabulin for 6 years, starting from preclinical proof-of-concept work in showing its DC maturation, abscopal effect and selective sequencing benefit with radiation, presented at the 2020 AACR (Free AACR Whitepaper) meeting, and now the successful clinical translation in the triple IO regimen and its notable high disease control rate in these hard-to-treat and multiple refractory cancers", Dr. Steven H. Lin, MD/PhD, professor of radiation oncology at MD Anderson commented. "These results are encouraging but preliminary. Based on the consistent mechanism in DC maturation in responding patients, this sets the stage for additional clinical studies of plinabulin/IO combinations in IO-refractory settings in a number of indications, including NSCLC and Hogkins Lymphoma".

SITC Conference Abstract Number: 732

Title: Immune Activation with Plinabulin Enhances Anti-tumor response Combining Radiation with Immune Checkpoint Blockade

Presenter: Steven H. Lin, MD/PhD

Session: Poster Hall

Phase 1 Study Regimen

All subjects received a triple combo treatment of Radiation Therapy (RT) + Plinabulin + Pembrolizumab or Nivolumab in Cycle 1, followed by the same anti-PD-1 antibody and plinabulin combo regimen in Cycle 2 and beyond until disease progression or development of unacceptable toxicity, withdrawal from study treatment, or discontinuation of this study.

A short course of local consolidative RT was administered in Cycle 1 starting from Day 1. Optional sequential RT may have been administered to target other untreated lesions at discretion of the treating doctor in Cycle 2 of any regimens.
Plinabulin was dosed on Day 1 and Day 4 of Cycle 1 of any anti-PD-1 regimen, and if optional RT was given in Cycle 2, Plinabulin was also given on Day 4 of Cycle 2. Plinabulin was given on Day 1 of Cycle 3 and thereafter. Anti-PD-1 antibody was dosed on Day 1 of every treatment cycle (also on Day 15 [Q4W] in case of regimen containing Nivolumab as Anti-PD-1 mAb).
Subjects received the same anti-PD-1/PD-L1 mAb they failed in the prior treatment.
Conference Call and Webcast Information

BeyondSpring will host a conference call and webcast today at 8:30 a.m. Eastern Time. The dial in numbers for the conference call are 1-877-407-0792 (U.S.) or 1-201-689-8263 (international). Please reference conference title: Clinical Significance of Plinabulin SITC (Free SITC Whitepaper) Presentation with PI Dr. Steven Lin from MD Anderson. A live webcast will be available on BeyondSpring’s website at www.beyondspringpharma.com under "Events & Presentations" in the Investors section. An archived replay of the webcast will be available for 30 days.

Ascendis Pharma Reports Third Quarter 2023 Financial Results

On November 7, 2023 Ascendis Pharma A/S (Nasdaq: ASND) reported financial results for the third quarter ended September 30, 2023 and provided business updates (Press release, Ascendis Pharma, NOV 7, 2023, View Source [SID1234637119]).

"This quarter marks an important milestone for Ascendis on our path to become a leading, sustainable biopharma company, where we began our journey to extend our SKYTROFA U.S. market value leadership globally with our first EU product launch in Germany," said Jan Mikkelsen, Ascendis Pharma’s President and Chief Executive Officer. "Expected approval in the EU for our second product, TransCon PTH, this month demonstrates the value of following our algorithm for product innovation."

Corporate Highlights

TransCon hGH (marketed in the U.S. and EU as SKYTROFA):
Third quarter 2023 SKYTROFA revenue totaled €47.0 million, a 31% sequential increase. Increased full year 2023 SKYTROFA revenue expectations from €165 – €170 million to €170 – €175 million.

Q3-2022 Q4-2022 Q1-2023 Q2-2023 Q3-2023
SKYTROFA revenue (millions) €12.3 €17.1 €31.6 €35.9 €47.0

Announced results from enliGHten, the Company’s open-label extension trial evaluating the long-term safety and efficacy of TransCon hGH for children and adolescents with growth hormone deficiency (GHD), demonstrating the long-term safety and efficacy of TransCon hGH in patients treated up to six years, with the majority of children meeting or exceeding average parental height SDS at time of treatment completion or last visit.
Topline results from Phase 3 foresiGHt Trial in adult growth hormone deficiency expected in the fourth quarter of 2023, potentially opening a new label expansion opportunity.
TransCon PTH:
On September 14, 2023, the European Medicines Agency’s Committee for Medicinal Products for Human Use (CHMP) adopted a positive opinion, recommending the approval of TransCon PTH (palopegteriparatide) as a parathyroid hormone replacement therapy indicated for the treatment of adults with chronic hypoparathyroidism. Final European Commission decision is expected this month. If approved, the first launch is planned in Germany, leveraging the Company’s existing SKYTROFA commercial infrastructure, in January 2024.
In the U.S., expect to resubmit NDA for TransCon PTH for adults with hypoparathyroidism to the FDA before mid-November.
Presented 52-week data from Phase 3 PaTHway Trial demonstrating that skeletal dynamics of patients with chronic hypoparathyroidism trended toward a new steady state closer to age-appropriate norms with continued use of TransCon PTH. Results confirm trends previously reported in the Phase 2 PaTH Forward Trial.
As of September 30, 2023, 145 out of 154 participants continue in the open-label extension (OLE) portions of the Phase 2 PaTH Forward, Phase 3 PaTHway, and PaTHway Japan trials.
TransCon CNP:
Completed enrollment in ApproaCH, a Phase 3, global randomized, double-blind, placebo-controlled trial in children ages 2–11 years with achondroplasia. Topline results are expected in the second half of 2024.
Filed an Investigational New Drug (IND) amendment with the FDA to initiate reACHin, a Phase 2, multicenter, double-blind, randomized, placebo-controlled trial, designed to evaluate the safety, tolerability, and efficacy of 100 μg/kg of TransCon CNP once-weekly for 52 weeks in infants aged 0 to < 2 years with achondroplasia.
One-year follow-up data from AComplisH OLE expected in the fourth quarter of 2023.
During the fourth quarter of 2023, the Company expects to file an IND amendment or similar for COACH, a combination trial evaluating TransCon CNP and TransCon hGH in children with achondroplasia. The Company believes that this combination therapy may provide greater annualized height velocity than CNP alone, and at the same time, address the comorbidities of achondroplasia.
TransCon IL-2 β/γ:
Reported new data from ongoing Phase 1/2 IL-Believe Trial demonstrating clinical activity of TransCon IL-2 β/γ as monotherapy or in combination with a checkpoint inhibitor. Of three small-cell lung cancer patients treated in the combination portion of the trial who had previously progressed on checkpoint inhibitors, a partial response (confirmed) and a complete response (unconfirmed, treatment ongoing) were observed to date.
Enrollment continues in the Phase 2 portion in indication-specific cohorts; first patient dosed with TransCon IL-2 β/γ and TransCon TLR7/8 Agonist in combination. Initial data from indication-specific cohorts expected in the second half of 2024.
TransCon TLR7/8 Agonist:
Enrollment continues in Phase 2 portion of transcendIT-101, a Phase 1/2 trial to evaluate TransCon TLR7/8 Agonist as monotherapy or in combination with pembrolizumab in dose escalation and dose expansion. Initial data expected in the second half of 2024.
Ended the third quarter of 2023 with cash, cash equivalents, and marketable securities totaling €455.4 million.
Third Quarter 2023 Financial Results
Total revenue for the third quarter of 2023 was €48.0 million compared to €15.3 million during the same period in 2022. The increase was primarily attributable to higher SKYTROFA revenue of €47.0 million compared to €12.3 million in the same period last year.

Research and development (R&D) costs for the third quarter were €111.4 million compared to €97.4 million during the same period in 2022. This increase was primarily due to higher development costs for the Oncology and Ophthalmology programs, increasing clinical trial activities for TransCon CNP, and higher employee-related costs, and was partly offset by lower development costs for TransCon hGH.

Selling, general, and administrative (SG&A) expenses for the third quarter were €63.6 million compared to €60.7 million during the same period in 2022. This increase was primarily due to higher employee related expenses and other expenses attributable to organizational growth.

Net finance expenses were €20.4 million in the third quarter compared to €20.9 million in the same period in 2022.

For the third quarter of 2023, Ascendis Pharma reported a net loss of €162.2 million, or €2.88 per share (basic and diluted) compared to a net loss of €169.0 million, or €3.03 per share (basic and diluted) for the same period in 2022.

As of September 30, 2023, Ascendis Pharma had cash, cash equivalents, and marketable securities totaling €455.4 million compared to €742.9 million as of December 31, 2022. As of September 30, 2023, Ascendis Pharma had 57,656,568 ordinary shares outstanding.

Conference Call and Webcast Information
Ascendis Pharma will host a conference call and webcast today at 4:30 pm Eastern Time (ET) to discuss its third quarter 2023 financial results.

To participate in the call, please dial (800) 445-7795 (domestic) or +1 (785) 424-1699 (international), and reference passcode ASNDQ323. The link to the live webcast will also be available on the Investors & News section of the Ascendis Pharma website at View Source A replay of the webcast will be available on this section of our website shortly after conclusion of the event for 30 days.

Arvinas Reports Third Quarter 2023 Financial Results and Provides Corporate Update

On November 7, 2023 Arvinas, Inc. (Nasdaq: ARVN), a clinical-stage biotechnology company creating a new class of drugs based on targeted protein degradation, reported financial results for the third quarter ended September 30, 2023 and provided a corporate update (Press release, Arvinas, NOV 7, 2023, View Source [SID1234637118]).

"We continued making strong progress in the third quarter of 2023 as we executed across our entire portfolio of PROTAC protein degraders," said John Houston, Ph.D., chairperson, chief executive officer, and president at Arvinas. "We remain focused on developing best-in-class medicines and are very pleased with the progress of our ER and AR degraders, both of which have the potential to make meaningful differences for patients. In the second half of next year, we anticipate completion of our first Phase 3 trial with our novel PROTAC ER degrader, vepdegestrant, in a second-line metastatic breast cancer setting, which we are jointly developing with Pfizer. Additionally, the profile of our PROTAC AR degrader, ARV-766, gives us the confidence to initiate a Phase 3 trial in metastatic castration resistant prostate cancer as soon as possible. We are also preparing to move two new compounds – our LRRK2 and BCL6 PROTAC protein degraders – into the clinic in 2024, with two more PROTAC protein degraders in IND-enabling studies by the end of 2023. We have a lot of milestones to deliver on in 2024 and I look forward to Arvinas’ continued success, with the ultimate, and most important goal of improving the lives of patients with serious diseases."

Recent Developments and Third Quarter Business Highlights

Androgen Receptor Franchise

Presented data from the Phase 1/2 clinical trial with bavdegalutamide at the European Society for Medical Oncology Congress (ESMO) (Free ESMO Whitepaper) showing a median radiographic progression free survival (rPFS) of 11.1 months in patients with AR 878/875 tumor mutations, demonstrating the strong potential for a PROTAC AR degrader in prostate cancer.
Manageable tolerability profile with no grade >4 treatment-related adverse events (TRAEs).
Prioritized the initiation of a Phase 3 trial with ARV-766 in mCRPC instead of the previously planned Phase 3 trial for bavdegalutamide.
New interim data from Phase 1/2 trial with ARV-766 showed a broader efficacy profile and superior tolerability versus bavdegalutamide in the clinical setting, with a potentially differentiated profile against other AR directed therapies.
Completed enrollment in the bavdegalutamide Phase 1b combination trial with abiraterone.
Vepdegestrant (ARV-471)

Presented updated dose-escalation data from the Phase 1/2 trial with vepdegestrant at ESMO (Free ESMO Whitepaper) showing continued strong anti-tumor activity and highly differentiated tolerability.
Continued enrollment in the study lead-in of the VERITAC-3 Phase 3 trial of vepdegestrant plus palbociclib as a first-line treatment in patients with ER+/HER2- locally advanced or metastatic breast cancer (ClinicalTrials.gov Identifier: NCT05909397).
Continued enrollment in the VERITAC-2 Phase 3 2L+ clinical trial of vepdegestrant as a monotherapy for the treatment of patients with ER+/HER2- metastatic breast cancer (ClinicalTrials.gov Identifier: NCT05654623).
Continued enrollment in the TACTIVE-U trial evaluating vepdegestrant with targeted therapies [ClinicalTrials.gov Identifiers: NCT05548127 and NCT05573555]).
Continued enrollment in the TACTIVE-E trial of vepdegestrant in combination with everolimus (ClinicalTrials.gov Identifier: NCT05501769), and the TACTIVE-N trial of vepdegestrant as a monotherapy in the neoadjuvant setting (ClinicalTrials.gov Identifier: NCT05549505).
Received Study May Proceed letter from the U.S. FDA for the Phase 1b/2 clinical trial evaluating vepdegestrant in combination with Pfizer’s CDK4 inhibitor (PF-07220060).
Awarded Innovation Passport Designation for vepdegestrant by the U.K. Innovative Licensing and Access Pathway Steering Group.
Anticipated Upcoming Milestones and Expectations

Vepdegestrant (ARV-471)
As part of Arvinas’ global collaboration with Pfizer, the companies plan to:

Present updated data for vepdegestrant at the San Antonio Breast Cancer Symposium, including new data from the Phase 1b trial assessing vepdegestrant in combination with palbociclib (December 2023).
Continue enrollment in the study lead-in for the VERITAC-3 Phase 3 trial of vepdegestrant and palbociclib as a first-line treatment in patients with ER+/HER2- locally advanced or metastatic breast cancer.
Initiate a Phase 1b/2 trial with vepdegestrant plus Pfizer’s CDK4 (cyclin dependent kinase) inhibitor (4Q 2023).
Continue enrollment of the Phase 1b combination umbrella trial evaluating combination of vepdegestrant with abemaciclib and with ribociclib (TACTIVE-U: ClinicalTrials.gov Identifiers: NCTC05548127 and NCTC05573555); initiate additional arm with Carrick Therapeutics’ CDK7 inhibitor.
Complete enrollment in the TACTIVE-N Phase 2 trial of vepdegestrant as a monotherapy in the neoadjuvant setting (ClinicalTrials.gov Identifier: NCT05549505) in patients with ER+/HER2- localized breast cancer (2024).
Complete enrollment of the VERITAC-2 Phase 3 monotherapy trial (ClinicalTrials.gov Identifier: NCT05654623) in patients with metastatic breast cancer (2H 2024).
Androgen Receptor (AR) Franchise (ARV-766/bavdegalutamide (ARV-110))

Continue enrollment of Phase 2 dose expansion study with ARV-766, with progression free survival data anticipated in 2024.
Initiate a Phase 1b/2 dose escalation trial with ARV-766 in combination with abiraterone in patients who have not previously received novel hormonal agents (4Q 2023).
Initiate discussions with regulatory authorities for a planned Phase 3 trial with ARV-766 in mCRPC (2Q 2024).
Pipeline:

Submit two investigational new drug (IND)/clinical trial authorization (CTA) applications for the Company’s BCL6 (oncology) and LRRK2 (neuroscience) PROTAC protein degraders by year-end 2023.
Progress at least two additional PROTAC protein degrader programs into IND- or CTA-enabling studies by year-end 2023.
Financial Guidance

Based on its current operating plan, Arvinas believes its cash, cash equivalents, restricted cash and marketable securities as of September 30, 2023, is sufficient to fund planned operating expenses and capital expenditure requirements into 2026.

Third Quarter Financial Results

Cash, Cash Equivalents and Marketable Securities Position: As of September 30, 2023, cash, cash equivalents, restricted cash and marketable securities were $1,004.0 million as compared with $1,210.8 million as of December 31, 2022. The decrease in cash, cash equivalents, restricted cash and marketable securities of $206.8 million for the nine months ended September 30, 2023 was primarily related to cash used in operations of $253.0 million (net of $2.5 million received from two collaborators), leasehold improvements of $2.8 million and loss on the sale of marketable securities of $0.9 million, partially offset by net proceeds from the issuance of common stock under our ATM offering of $36.0 million, unrealized gains on marketable securities of $10.0 million and proceeds from the exercise of stock options of $3.9 million.

Research and Development Expenses: Research and development expenses were $85.9 million for the quarter ended September 30, 2023, as compared with $77.5 million for the quarter ended September 30, 2022. The increase in research and development expenses of $8.4 million for the quarter was primarily due to increases our AR program of $5.2 million, which includes ARV-766 and bavdegalutamide, and our ER program of $6.2 million, which is net of the cost sharing of vepdegestrant under the Vepdegestrant (ARV-471) Collaboration Agreement, offset by a decrease in our platform and exploratory programs of $3.0 million.

General and Administrative Expenses: General and administrative expenses were $22.6 million for the quarter ended September 30, 2023, as compared with $20.0 million for the quarter ended September 30, 2022. The increase of $2.6 million was primarily due to increased investments in our commercial operations of $1.0 million, an increase in personnel and infrastructure related costs of $1.1 million, and an increase in professional fees of $0.5 million.

Revenues: Revenues were $34.6 million for the quarter ended September 30, 2023, as compared with $33.2 million for the quarter ended September 30, 2022. Revenue is related to the Vepdegestrant (ARV-471) Collaboration Agreement, the collaboration and license agreement with Bayer, the collaboration and license agreement with Pfizer, the amended and restated option, license and collaboration agreement with Genentech and revenue related to our Oerth Bio joint venture which was initiated in July 2019. The increase in revenues of $1.4 million was primarily due to an increase in revenue from the Vepdegestrant (ARV-471) Collaboration Agreement totaling $6.4 million, partially offset by a decrease in revenue of $2.8 million of previously constrained deferred revenue related to our Oerth Bio joint venture and a decrease of $1.8 million related to the conclusion of the performance period under the collaboration agreement with Genentech.

Income Tax Expense: Income tax was zero for the quarter ended September 30, 2023, as compared with an income tax expense of $2.2 million for the quarter ended September 30, 2022. Current year income tax expense was driven by valuation allowance recorded against the full amount of its net deferred tax assets. Prior year income tax expense was driven by revenue recognized in 2022 for tax purposes from the Vepdegestrant (ARV-471) Collaboration Agreement.

Loss from Equity Method Investment: Loss from equity method investment was $0.1 million for the quarter ended September 30, 2023, as compared with $2.9 million for the quarter ended September 30, 2022, due to fully recognizing the remaining Oerth Bio related constrained revenue, which limited the amount of equity method losses recognized during the quarter.

Net Loss: Net loss was $64.0 million for the quarter ended September 30, 2023, as compared with $66.2 million for the quarter ended September 30, 2022. The decrease in net loss for the quarter was primarily due to increased revenue and interest income from our marketable securities, as well as decreased income tax expense and loss from equity method investments, partly offset by increased research and development expenses and general and administrative expenses.

About ARV-766 and bavdegalutamide (ARV-110)
ARV-766 and bavdegalutamide (ARV-110) are investigational orally bioavailable PROTAC protein degraders designed to selectively target and degrade the androgen receptor (AR). ARV-766 and bavdegalutamide are being developed as potential treatments for men with prostate cancer. Preclinically, both investigational agents have demonstrated activity in models of wild type tumors in addition to tumors with AR mutation or amplification, both common mechanisms of resistance to currently available AR-targeted therapies.

About vepdegestrant (ARV-471)
Vepdegestrant is an investigational, orally bioavailable PROTAC protein degrader designed to specifically target and degrade the estrogen receptor (ER) for the treatment of patients with ER positive/human epidermal growth factor receptor 2 (HER2) negative (ER+/HER2-) breast cancer.
In preclinical studies, vepdegestrant demonstrated up to 97% ER degradation in tumor cells, induced robust tumor shrinkage when dosed as a single agent in multiple ER-driven xenograft models, and showed increased anti-tumor activity when compared to a standard of care agent, fulvestrant, both as a single agent and in combination with a CDK4/6 inhibitor. In July 2021, Arvinas announced a global collaboration with Pfizer for the co-development and co-commercialization of vepdegestrant; Arvinas and Pfizer will equally share worldwide development costs, commercialization expenses, and profits. Ongoing and planned clinical trials will continue to monitor and evaluate the safety and anti-tumor activity of vepdegestrant.

Arcus Biosciences Reports Third Quarter 2023 Financial Results and Provides a Pipeline Update

On November 7, 2023 Arcus Biosciences, Inc. (NYSE:RCUS), a clinical-stage, global biopharmaceutical company focused on developing differentiated molecules and combination therapies for people with cancer, reported financial results for the third quarter ended September 30, 2023, and provided a pipeline update on its clinical-stage investigational molecules – targeting TIGIT, the adenosine axis (CD73 and A2a/A2b receptors), HIF-2a and PD-1 – across multiple common cancers (Press release, Arcus Biosciences, NOV 7, 2023, View Source [SID1234637117]).

"As we continue to execute on our Phase 3 trials for domvanalimab in lung and GI cancers, we have one of three important near-term data readouts now behind us. Today’s presentation of data from our Phase 2 EDGE-Gastric study provided important evidence to support domvanalimab’s potential as a differentiated and first-to-market anti-TIGIT antibody for the treatment of first-line upper GI adenocarcinomas. We are also looking forward to sharing more on our HIF-2a inhibitor, AB521, which continues to show a potentially improved clinical profile, with PK/PD results in patients consistent with those seen in healthy volunteers," said Terry Rosen, Ph.D., chief executive officer of Arcus. "Lastly, we will be presenting mature OS data from our Phase 1/1b study of quemliclustat in pancreatic cancer early next year; we are excited to share next steps in the coming months."

Pipeline Highlights:

Domvanalimab (Fc-silent anti-TIGIT monoclonal antibody)
•Preliminary data from Arm A1 of the Phase 2 EDGE-Gastric study, evaluating domvanalimab plus zimberelimab and chemotherapy in patients with previously untreated, locally advanced unresectable or metastatic upper gastrointestinal (GI) cancers, were presented during the Annual Meeting of the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Plenary Series on November 7, 2023. These data were from the cohort that includes a patient population and dosing regimen similar to the ongoing Phase 3 study, STAR-221.
◦Domvanalimab plus zimberelimab and chemotherapy showed encouraging objective response rates (ORR) of 80% (confirmed ORR (cORR) of 73%) in patients with PD-L1-high tumors (TAP ≥5%), 46% (all confirmed) in patients with PD-L1-low tumors (TAP <5%) and 59% (cORR of 56%) for patients overall.
◦Six-month landmark progression-free survival (PFS) was 93% for patients with PD-L1-high tumors (TAP ≥5%), 68% for patients with PD-L1-low tumors (TAP <5%) and 77% for patients overall.
◦Mature PFS has not been reached and data are expected in the second half of 2024.
◦Domvanalimab plus zimberelimab and chemotherapy was well tolerated, with a similar safety profile to what has been reported for anti-PD-1 plus chemotherapy in this setting.

◦Domvanalimab is the only Fc-silent anti-TIGIT antibody in Phase 3 for gastric, gastroesophageal junction and esophageal adenocarcinoma and has the potential to be first to market for these cancers. These tumor types represent a potential drug-treatable population of over 25,000 in the US and over 100,000 in G-7 countries.
AB521 (HIF-2a inhibitor)

•Pharmacokinetic (PK) and pharmacodynamic (PD) data from the dose-escalation phase of ARC-20, a Phase 1/1b study of AB521 in cancer patients, are consistent with the results seen in healthy volunteers to date.
◦No dose-limiting toxicities have been observed to date in ARC-20.
◦Detailed PK, PD and safety data along with preliminary anti-tumor activity from this stage of ARC-20 will be shared in early 2024.
•Enrollment for the dose-expansion stage of ARC-20 in clear cell renal cell carcinoma (ccRCC) patients is near completion. Efficacy data from this stage of the ARC-20 study are expected later in 2024. The dose-expansion stage will include 30 patients on a 100-mg daily dose, which Arcus believes has the potential to achieve substantially greaterHIF-2a inhibition than the approved dose of the marketed competitor.
•A Phase 2 study evaluating AB521 in combination with a tyrosine kinase inhibitor (TKI) is anticipated to begin in the fourth quarter of 2023.
Quemliclustat (small-molecule CD73 inhibitor)
•Arcus conducted an analysis of mature OS data (minimum follow-up of 18 months) from the ongoing Phase 1/1b ARC-8 trial evaluating quemliclustat plus chemotherapy with or without zimberelimab in first-line pancreatic cancer.
◦At this analysis, 122 patients in the study had received the go-forward dose of 100 mg of quemliclustat; median follow-up time was 21 months.
◦These data will be presented in early 2024.
Etrumadenant (A2a/A2b adenosine receptor antagonist)
•Data from ARC-9, a Phase 1b/2 study evaluating etrumadenant plus zimberelimab plus chemotherapy in second-line and third-line metastatic colorectal cancer (mCRC), which is fully enrolled, are expected in the first half of 2024.
Early Clinical and Preclinical Programs
•ARC-25, a Phase 1 trial in cancer patients for AB598, an anti-CD39 antibody, is currently enrolling.
•Arcus initiated a Phase 1 study in healthy volunteers of AB801, its potent and highly selective AXL inhibitor, and expects to initiate a Phase 1 study in advanced cancer patients in the first quarter of 2024.
•Arcus expects to select a new development candidate against KIT, a target involved in multiple allergic and immune-mediated diseases, by year end.
Financial Results for Third Quarter 2023:
•Cash, Cash Equivalents and Marketable Securities were $950 million as of September 30, 2023, compared to $1.1 billion as of December 31, 2022. The decrease during the period is primarily due to the use of cash in research and development activities, partially offset by receipts of $35 million in upfront payments from Gilead to initiate Arcus-led discovery and early development activities on two jointly selected inflammation targets and $25 million in proceeds from the issuance of 1.2 million shares of our common stock. Arcus now expects cash utilization between $265 million and $290 million for the year ended December 31, 2023. Arcus continues to expect cash, cash equivalents and marketable securities on-hand to be sufficient to fund operations into 2026.
•Revenues were $32 million for the third quarter 2023, compared to $33 million for the same period in 2022. In the third quarter 2023, Arcus recognized $22 million in license and development service revenues related to the advancement of programs, primarily the Gilead collaboration, as well as $10 million in other collaboration revenue primarily related to Gilead’s ongoing rights to access Arcus’s research and development pipeline in accordance with the Gilead collaboration agreement. Revenues were $86 million for the nine months ended September 30, 2023, compared to $78 million for the same period in 2022.
•Research and Development (R&D) Expenses were $82 million for the third quarter 2023, compared to $77 million for the same period in 2022. The net increase of $5 million was primarily driven by: $7 million of higher spend for Arcus programs not under a cost-sharing collaboration due to our expanding clinical and development activities; partially offset by a net decrease of $2 million in shared costs for programs optioned by our collaboration partners, primarily from the Gilead collaboration. The net decrease of $2 million was due to a decrease in shared collaboration costs of $10 million primarily from the timing of clinical manufacturing; with a corresponding decrease in reimbursements for shared expenses of $8 million. Non-cash stock-based compensation expense was $8 million for each of the third quarter 2023 and 2022. R&D expenses were $247 million for the nine months ended September 30, 2023, compared to $208 million for the same period in 2022. For third quarter 2023 and 2022, Arcus recognized reimbursements of $33 million and $41 million, respectively, for shared expenses from its collaborations, primarily the Gilead collaboration. Reimbursements were $119 million for the nine months ended September 30, 2023, compared to $111 million for the same period in 2022. R&D expense by quarter may fluctuate due to the timing of clinical manufacturing and standard-of-care therapeutic purchases with a corresponding impact on reimbursements.
•General and Administrative (G&A) Expenses were $30 million for the third quarter 2023, compared to $26 million for the same period in 2022. The increase was primarily driven by the increased complexity of supporting Arcus’s expanding clinical pipeline and partnership obligations. Non-cash stock-based compensation expense was $10 million for the third quarter 2023, compared to $8 million for the same period in 2022. G&A expenses were $88 million for the nine months ended September 30, 2023, compared to $76 million for the same period in 2022.
•Net Loss was $71 million for the third quarter 2023, compared to $65 million for the same period in 2022. The increase in net loss included an increase of $2 million in income tax expense primarily due to an increase in taxable income compared to the prior year. Net loss was $226 million for the nine months ended September 30, 2023, compared to $200 million for the same period in 2022.

Arcus Ongoing and Announced Clinical Studies:
Trial Name Arms Setting Status NCT No.
Lung Cancer
ARC-7 zim vs. dom + zim vs. etruma + dom + zim 1L NSCLC (PD-L1 ≥ 50%) Ongoing Randomized Phase 2 NCT04262856
PACIFIC-8
(Operationalized by AZ)
dom + durva vs. durva Curative-Intent Stage 3 NSCLC Ongoing Registrational Phase 3 NCT05211895
ARC-10 dom + zim vs. pembro 1L NSCLC (PD-L1 ≥ 50%) Ongoing Registrational Phase 3 NCT04736173
STAR-121
(Operationalized by Gilead)
dom + zim + chemo vs. pembro + chemo 1L NSCLC (PD-L1 all-comers) Ongoing Registrational Phase 3 NCT05502237
EDGE-Lung dom +/- zim +/- quemli +/- chemo 1L/2L NSCLC (lung cancer platform study) Ongoing Randomized Phase 2 NCT05676931
VELOCITY-Lung
(Operationalized by Gilead)
dom +/- zim +/- etruma +/- sacituzumab govitecan-hziy or other combos 1L/2L NSCLC (lung cancer platform study) Ongoing Randomized Phase 2 NCT05633667
Gastrointestinal Cancers
ARC-9 etruma + zim + mFOLFOX vs. SOC 2L/3L/3L+ CRC
Ongoing
Randomized Phase 2
NCT04660812
EDGE-Gastric (ARC-21) dom +/- zim +/- quemli +/- chemo 1L/2L Upper GI Malignancies
Ongoing
Randomized Phase 2
NCT05329766
STAR-221 dom + zim + chemo vs. nivo + chemo 1L Gastric, Gastroesophageal Junction (GEJ) and Esophageal Adenocarcinoma (EAC) Ongoing Registrational Phase 3 NCT05568095
Pancreatic Cancer
ARC-8 quemli + zim + gem/nab-pac vs. quemli + gem/nab-pac 1L, 2L PDAC Ongoing Randomized Phase 1/1b NCT04104672
Prostate Cancer
ARC-6 etruma + zim + SOC vs. SOC 2L/3L CRPC Ongoing Randomized Phase 2 NCT04381832
Renal Cancer
ARC-20 AB521 Cancer Patients / ccRCC Ongoing Phase 1/1b NCT05536141
Other
ARC-25 AB598 Advanced Malignancies Ongoing NCT05891171
ARC-26 AB801 Healthy Volunteers Ongoing NCT06004921
ARC-27 AB801 Advanced Malignancies Planned NCT06120075

dom: domvanalimab; durva: durvalumab; etruma: etrumadenant; gem/nab-pac: gemcitabine/nab-paclitaxel; nivo: nivolumab; pembro: pembrolizumab; quemli: quemliclustat; SOC: standard of care; zim: zimberelimab;
ccRCC: clear-cell renal cell carcinoma; CRC: colorectal cancer; CRPC: castrate-resistant prostate cancer; GI: gastrointestinal; NSCLC: non-small cell lung cancer; PDAC: pancreatic ductal adenocarcinoma.