On October 27, 2020 Strata Oncology, Inc., a precision oncology company advancing molecular indications for cancer therapies, reported that Palmetto GBA, a Medicare Administrative Contractor (MAC), has established coverage of the StrataNGS test for patients with advanced stages (III or IV), recurrent, relapsed, refractory, and/or metastatic solid tumors (Press release, Strata Oncology, OCT 27, 2020, View Source [SID1234569159]).

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Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

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StrataNGS is a comprehensive genomic profiling (CGP) test that features leading performance on small tumor tissue samples. The 429-gene assay is performed on co-isolated RNA and DNA. Single-/multi-nucleotide variants (SNVs), short insertions and deletions (indels), copy number alterations (CNAs; amplifications and deep deletions), microsatellite instability (MSI) status, gene fusions, and tumor mutation burden (TMB) are assessed simultaneously.

A recent study presented at the 2020 Annual Meeting of the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) showed that the performance of StrataNGS on small tumor tissue samples may enable access to testing for more than double the number of patients compared to other leading comprehensive genomic profiling (CGP) tests. The results from an analysis of data collected in the Strata Trial demonstrated that only 43 percent of >20,000 consecutive tumor tissue samples received for CGP met tissue surface area requirements for leading commercial hybrid-capture-CGP tests. StrataNGS, a PCR-CGP test, delivered reportable results in 93 percent of all samples received.

"Medicare coverage of StrataNGS is an important milestone toward enabling broader access to comprehensive genomic profiling for patients with cancer," said Dan Rhodes, Ph.D., co-founder and CEO of Strata Oncology. "Tumor tissue availability is a major barrier to test access. With industry-low tumor tissue requirements, StrataNGS expands the number of patients that can receive tissue-based molecular profiling and potentially benefit from biomarker-guided targeted and immunotherapies."

StrataNGS has been available to patients as part of the Strata Trial, an observational trial conducted by Strata Oncology at over 125 hospitals nationwide. The company will continue to focus on its health system network before pursuing a broader commercial launch in 2021.

About StrataNGS
StrataNGS is a comprehensive genomic profiling (CGP) test that features leading performance on small tumor tissue samples (>0.5mm2 surface area). The 429-gene assay is performed on co-isolated RNA and DNA. Single-/multi-nucleotide variants (SNVs), short insertions and deletions (indels), copy number alterations (CNAs; amplifications and deep deletions), microsatellite instability (MSI) status, gene fusions, and tumor mutation burden (TMB) are assessed simultaneously.

On October 27, 2020 Unum Group (NYSE: UNM) reported net income of $231.1 million ($1.13 per diluted common share) for the third quarter of 2020, compared to net income of $242.0 million ($1.16 per diluted common share) for the third quarter of 2019 (Press release, Unum Therapeutics, OCT 27, 2020, View Source [SID1234569158]).

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Included in net income for the third quarter of 2020 are after-tax costs related to an organizational design update of $18.6 million ($0.09 per diluted common share), as well as a net after-tax realized investment gain on the Company’s investment portfolio of $3.8 million ($0.01 per diluted common share). Included in net income for the third quarter of 2019 are after-tax costs related to the early retirement of debt of $19.9 million ($0.10 per diluted common share), as well as a net after-tax realized investment loss on the Company’s investment portfolio of $20.8 million ($0.10 per diluted common share). Excluding the items above, after-tax adjusted operating income was $245.9 million ($1.21 per diluted common share) in the third quarter of 2020, compared to $282.7 million ($1.36 per diluted common share) in the third quarter of 2019.

"Financial performance remained solid in the third quarter, despite pressure from elevated mortality rates and unemployment levels," said Richard P. McKenney, president and chief executive officer. "Our team continues to deliver solid operational performance, adapting to best serve our customers in this extraordinary time. This environment reinforces the fundamental purpose for what we do in protecting employees and their families in time of need. We continue to be well-positioned to benefit from better business conditions as the economy improves and will continue to effectively manage through today’s challenges."

RESULTS BY SEGMENT

We measure and analyze our segment performance on the basis of "adjusted operating income" or "adjusted operating loss," which differ from income before income tax as presented in our consolidated statements of income due to the exclusion of net realized investment gains and losses and certain other items. These performance measures are in accordance with GAAP guidance for segment reporting, but they should not be viewed as a substitute for income before income tax or net income.

Unum US Segment

Unum US reported adjusted operating income of $188.2 million in the third quarter of 2020, a decrease of 28.0 percent from $261.4 million in the third quarter of 2019. Premium income for the segment decreased 1.2 percent to $1,483.4 million in the third quarter of 2020, compared to premium income of $1,501.9 million in the third quarter of 2019. Net investment income for the segment increased 3.5 percent to $190.7 million in the third quarter of 2020, compared to $184.2 million in the third quarter of 2019.

Within the Unum US operating segment, the group disability line of business reported a 12.0 percent decrease in adjusted operating income to $73.0 million in the third quarter of 2020, compared to $83.0 million in the third quarter of 2019. Premium income for the group disability line of business was $646.7 million in the third quarter of 2020, which was generally consistent with the $648.0 million in the third quarter of 2019. Net investment income increased 5.9 percent to $105.4 million in the third quarter of 2020, compared to $99.5 million in the third quarter of 2019, driven by higher miscellaneous investment income, partially offset by a lower yield on invested assets. The benefit ratio of 74.1 percent for the third quarter of 2020 was generally consistent with the 74.2 percent in the third quarter of 2019, due to higher claim recoveries in our group long-term disability product line, mostly offset by higher claims incidence in the short term disability product line. Group long-term disability sales were $29.8 million in the third quarter of 2020, an increase of 25.2 percent from $23.8 million in the third quarter of 2019. Group short-term disability sales were $15.2 million in the third quarter of 2020, a decrease of 25.9 percent from $20.5 million in the third quarter of 2019. Persistency in the group long-term disability product line was 90.3 percent for the first nine months of 2020, compared to 90.7 percent for the first nine months of 2019. Persistency in the group short-term disability product line was 87.5 percent for the first nine months of 2020, compared to 89.9 percent for the first nine months of 2019.

The group life and accidental death and dismemberment line of business reported adjusted operating income of $13.9 million in the third quarter of 2020, a decrease of 79.7 percent from $68.4 million in the third quarter of 2019. Premium income for this line of business decreased 2.3 percent to $446.0 million in the third quarter of 2020, compared to $456.5 million in the third quarter of 2019, driven primarily by lower year-to-date sales and persistency. Net investment income decreased 6.7 percent to $25.2 million in the third quarter of 2020, compared to $27.0 million in the third quarter of 2019, due primarily to decline in both the yield and level of invested assets, partially offset by higher miscellaneous investment income. The benefit ratio in the third quarter of 2020 was 83.5 percent, compared to 72.0 percent in the third quarter of 2019, due primarily to higher claims incidence in the group life product line, likely resulting from the impacts of COVID-19. Sales of group life and accidental death and dismemberment products increased 1.3 percent in the third quarter of 2020 to $31.3 million, compared to $30.9 million in the third quarter of 2019. Persistency in the group life product line was 88.6 percent for the first nine months of 2020, compared to 90.8 percent for the first nine months of 2019. Persistency in the accidental death and dismemberment product line was 87.8 percent for the first nine months of 2020, compared to 90.1 percent for the first nine months of 2019.

The supplemental and voluntary line of business reported a decrease of 7.9 percent in adjusted operating income to $101.3 million in the third quarter of 2020, compared to $110.0 million in the third quarter of 2019. Premium income for the supplemental and voluntary line of business decreased 1.7 percent to $390.7 million in the third quarter of 2020, compared to $397.4 million in the third quarter of 2019, with declines in the voluntary benefits and dental and vision product lines, partially offset by growth in the individual disability product line. Net investment income increased 4.2 percent to $60.1 million in the third quarter of 2020, compared to $57.7 million in the third quarter of 2019, due to a higher miscellaneous investment income, partially offset by a decline in the yield on invested assets. The benefit ratio for the individual disability product line was 48.6 percent for the third quarter of 2020, compared to 49.5 percent for the third quarter of 2019, due to favorable claim recoveries. The benefit ratio for the voluntary benefits product line was 45.6 percent in the third quarter of 2020, compared to 44.2 percent for the third quarter of 2019, due primarily to higher claims incidence in the life product line, likely resulting from the impacts of COVID-19. The benefit ratio for the dental and vision product line was 76.8 percent for the third quarter of 2020, compared to 74.0 percent for the third quarter of 2019, due primarily to higher claims incidence. Relative to the third quarter of 2019, sales in the individual disability product line declined 37.3 percent in the third quarter of 2020 to $17.0 million. Sales in the voluntary benefits product line declined 35.8 percent in the third quarter of 2020 to $29.9 million. Sales in the dental and vision product line totaled $8.5 million for the third quarter of 2020, a decrease of 33.1 percent compared to the third quarter of 2019. Persistency in the individual disability product line was 89.8 percent for the first nine months of 2020, compared to 90.1 percent for the first nine months of 2019. Persistency in the voluntary benefits product line was 72.7 percent for the first nine months of 2020, compared to 72.5 percent for the first nine months of 2019. Persistency in the dental and vision product line was 82.4 percent for the first nine months of 2020, compared to 84.1 percent for the first nine months of 2019.

Unum International

The Unum International segment reported adjusted operating income of $21.4 million in the third quarter of 2020, a decrease of 11.6 percent from $24.2 million in the third quarter of 2019. Premium income increased 8.6 percent to $165.4 million in the third quarter of 2020, compared to $152.3 million in the third quarter of 2019. Net investment income increased 8.2 percent to $26.3 million in the third quarter of 2020, compared to $24.3 million in the third quarter of 2019. Sales decreased 9.7 percent to $17.7 million in the third quarter of 2020, compared to $19.6 million in the third quarter of 2019.

The Unum UK line of business reported adjusted operating income, in local currency, of £15.2 million in the third quarter of 2020, a decrease of 18.7 percent from £18.7 million in the third quarter of 2019. Premium income was £112.1 million in the third quarter of 2020, an increase of 2.8 percent from £109.0 million in the third quarter of 2019, driven by growth in the in-force block and the impact of rate increases in the group long-term disability product line. Net investment income was £18.9 million in the third quarter of 2020, an increase of 3.3 percent from £18.3 million in the third quarter of 2019, due to higher investment income from inflation index-linked bonds, partially offset by a lower yield on fixed-rate bonds. The benefit ratio in the third quarter of 2020 was 77.1 percent, compared to 73.4 percent in the third quarter of 2019, due to lower claim resolutions in the group long-term disability product line resulting from the continued disruption in claim processes related to COVID-19 and overall higher claims incidence. Sales decreased 20.7 percent to £10.7 million in the third quarter of 2020, compared to £13.5 million in the third quarter of 2019. Persistency in the group long-term disability product line was 87.2 percent for the first nine months of 2020, compared to 88.9 percent for the first nine months of 2019. Persistency in the group life product line was 81.0 percent for the first nine months of 2020, compared to 88.3 percent for the first nine months of 2019. Persistency in the supplemental product line was 90.3 percent for the first nine months of 2020, compared to 92.3 percent for the first nine months of 2019.

Colonial Life Segment

Colonial Life reported a 5.7 percent increase in adjusted operating income to $92.2 million in the third quarter of 2020, compared to $87.2 million in the third quarter of 2019. Premium income was $419.9 million in the third quarter of 2020, which was consistent with the $419.9 million in the third quarter of 2019. Net investment income increased 18.4 percent to $43.7 million in the third quarter of 2020 compared to the $36.9 million in the third quarter of 2019, due to higher miscellaneous investment income and an increase in the level of invested assets, partially offset by a decline in the yield on invested assets. The benefit ratio was 52.2 percent in the third quarter of 2020, compared to 51.4 percent in the third quarter of 2019, with unfavorable experience in the life product line, likely resulting from the impacts of COVID-19, partially offset by favorable experience in both the cancer and critical illness and accident, sickness, and disability lines of business.

Sales decreased 27.6 percent to $87.3 million in the third quarter of 2020, compared to $120.6 million in the third quarter of 2019. Persistency in Colonial Life was 77.6 percent for the first nine months of 2020, compared to 77.2 percent for the first nine months of 2019.

Closed Block Segment

The Closed Block segment reported adjusted operating income of $70.8 million in the third quarter of 2020, an increase of 163.2 percent from $26.9 million in the third quarter of 2019. Premium income for this segment declined 3.0 percent in the third quarter of 2020, compared to the third quarter of 2019, due to continued policy terminations and maturities in the individual disability line of business, partially offset by premium rate increases on certain in-force business in the long-term care line of business. Net investment income increased 1.1 percent to $351.2 million in the third quarter of 2020, compared to $347.3 million in the third quarter of 2019, due primarily to improved net asset values on our private equity partnerships and a higher level of invested assets, partially offset by a decrease in the yield on invested assets.

The interest adjusted loss ratio for the long-term care line of business was 67.4 percent in the third quarter of 2020, compared to an interest adjusted loss ratio of 89.8 percent in the third quarter of 2019, driven primarily by higher claimant mortality. The interest adjusted loss ratio for long-term care for the rolling twelve months ended September 30, 2020 was 75.6 percent which is below our long-term expected range. The interest adjusted loss ratio for the individual disability line of business was 86.6 percent in the third quarter of 2020, compared to 79.0 percent in the third quarter of 2019, driven by overall unfavorable claims activity.

Corporate Segment

The Corporate segment reported an adjusted operating loss of $54.1 million in the third quarter of 2020, which excludes the costs related to an organizational design update of $23.3 million compared to an adjusted operating loss of $48.9 million in the third quarter of 2019, which excludes the cost related to the early retirement of debt of $25.2 million.

OTHER INFORMATION

Shares Outstanding

The Company’s weighted average number of shares outstanding, assuming dilution, was 203.9 million for the third quarter of 2020, compared to 208.1 million for the third quarter of 2019. Shares outstanding totaled 203.6 million at September 30, 2020. The Company did not repurchase shares during the first nine months of 2020 and will not repurchase shares for the remainder of 2020.

Capital Management

At September 30, 2020, the weighted average risk-based capital ratio for the Company’s traditional U.S. insurance companies was approximately 380 percent, and cash and marketable securities in the holding companies equaled $1,178 million.

The Company intends to continue to pay its common stock dividend at the current rate.

Book Value

Book value per common share as of September 30, 2020 was $53.50, compared to $46.70 at September 30, 2019.

Outlook

As announced previously, due to the uncertain economic environment caused by the COVID-19 pandemic, the Company is suspending its financial guidance for the remainder of 2020.

NON-GAAP FINANCIAL MEASURES

We analyze our performance using non-GAAP financial measures. A non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. The non-GAAP financial measure of "after-tax adjusted operating income" differs from net income as presented in our consolidated operating results and income statements prepared in accordance with GAAP due to the exclusion of net realized investment gains and losses and certain other items as specified in the reconciliations in the Financial Highlights section below. We believe after-tax adjusted operating income is a better performance measure and better indicator of the profitability and underlying trends in our business.

Realized investment gains or losses depend on market conditions and do not necessarily relate to decisions regarding the underlying business of our segments. Our investment focus is on investment income to support our insurance liabilities as opposed to the generation of realized investment gains or losses. Although we may experience realized investment gains or losses which will affect future earnings levels, a long-term focus is necessary to maintain profitability over the life of the business since our underlying business is long-term in nature, and we need to earn the interest rates assumed in calculating our liabilities.

We may at other times exclude certain other items from our discussion of financial ratios and metrics in order to enhance the understanding and comparability of our operational performance and the underlying fundamentals. We exclude these items as we believe them to be infrequent or unusual in nature, but this exclusion is not an indication that similar items may not recur and does not replace net income or net loss as a measure of our overall profitability.

CONFERENCE CALL INFORMATION

Members of Unum Group senior management will host a conference call on Wednesday, October 28, at 8:00 a.m. (Eastern Time) to discuss the results of operations for the third quarter. Topics may include forward-looking information, such as the Company’s outlook on future results, trends in operations, and other material information.

The dial-in number for the conference call is (866) 575-6539 for U.S. and Canada (pass code 323905). For international, the dial-in number is (929) 477-0402 (pass code 323905). A live webcast of the call will also be available at www.investors.unum.com in a listen-only mode. It is recommended that webcast viewers access the "Investors" section of the Company’s website and opt-in to the webcast approximately 5-10 minutes prior to the start of the call. A replay of the webcast will be available on the Company’s website. A replay of the call will also be available through Wednesday, November 4 by dialing (888) 203-1112 (U.S. and Canada) or (719) 457-0820 (International) – pass code 323905.

In conjunction with today’s earnings announcement, the Company’s Statistical Supplement for the third quarter of 2020 is available on the "Investors" section of the Company’s website.

On October 27, 2020 Aflac Incorporated (NYSE: AFL) reported its third quarter results (Press release, Aflac, OCT 27, 2020, View Source [SID1234569156]).

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Total revenues were $5.7 billion in the third quarter of 2020, compared with $5.5 billion in the third quarter of 2019. Net earnings were $2.5 billion, or $3.44 per diluted share, compared with $777 million, or $1.04 per diluted share a year ago. The increase in net earnings in the third quarter of 2020 reflects a $1.4 billion benefit primarily from the release of valuation allowances on deferred tax benefits, which were allowed due to newly released U.S. tax regulations.

Net earnings in the third quarter of 2020 included pretax net investment gains of $117 million, or $0.16 per diluted share, compared with pretax net investment losses of $119 million, or $0.16 per diluted share a year ago. The net investment gains were driven by gains of $142 million, reflecting a decline in the allowances associated with the company’s estimate of current expected credit losses (CECL); net losses from certain derivatives and foreign currency activities of $38 million; an increase in the fair value of equity securities of $12 million; and net gains of $2 million from sales and redemptions.

The average yen/dollar exchange rate* in the third quarter of 2020 was 106.23, or 1.0% stronger than the average rate of 107.31 in the third quarter of 2019. For the first nine months, the average exchange rate was 107.63, or 1.4% stronger than the rate of 109.16 a year ago.

Total investments and cash at the end of September 2020 were $146.1 billion, compared with $139.5 billion at September 30, 2019. In the third quarter, Aflac Incorporated repurchased $400 million, or 10.9 million of its common shares. At the end of September 2020, the company had 110.9 million remaining shares authorized for repurchase.

Shareholders’ equity was $32.5 billion, or $46.16 per share, at September 30, 2020, compared with $29.4 billion, or $40.04 per share, at September 30, 2019. Shareholders’ equity at the end of the third quarter included a net unrealized gain on investment securities and derivatives of $9.5 billion, compared with a net unrealized gain of $8.9 billion at September 30, 2019. Shareholders’ equity at the end of the third quarter also included an unrealized foreign currency translation loss of $1.3 billion, compared with an unrealized foreign currency translation loss of $1.5 billion at September 30, 2019. The annualized return on average shareholders’ equity in the third quarter was 31.7%, driven primarily by a benefit from new tax regulations.

Adjusted earnings* in the third quarter were $994 million, compared with $863 million in the third quarter of 2019, reflecting an increase of 15.2% driven primarily by favorable effective tax rates. This increase includes a cumulative adjustment of $202 million, or $0.28 per share, with respect to the first nine months of 2020, of which $69 million, or $0.10 per share, related to the third quarter of 2020. Adjusted earnings included a pretax variable investment income of $21 million on alternative investments, which was $6 million above long-term return expectations. Adjusted earnings per diluted share* increased 19.8% to $1.39 in the quarter. The slightly stronger yen/dollar exchange rate did not have a significant impact on adjusted earnings per diluted share.

For the first nine months of 2020, total revenues were down 2.8% to $16.2 billion, compared with $16.7 billion in the first nine months of 2019. Net earnings were $3.8 billion, or $5.31 per diluted share, compared with $2.5 billion, or $3.37 per diluted share, for the first nine months of 2019. Adjusted earnings for the first nine months of 2020 were $2.8 billion, or $3.88 per diluted share, compared with $2.6 billion, or $3.41 per diluted share, in 2019. Adjusted earnings included $22 million of pretax variable investment income on alternative investments, which was $18 million below long-term return expectations. Excluding the positive impact of $0.02 per share from the stronger yen/dollar exchange rate, adjusted earnings per diluted share increased 13.2% to $3.86 for the first nine months of 2020.

Shareholders’ equity excluding AOCI* was $24.6 billion, or $34.91 per share at September 30, 2020, compared with $22.2 billion, or $30.18 per share, at September 30, 2019. The annualized adjusted return on equity excluding foreign currency impact* in the third quarter was 16.8%.

AFLAC JAPAN

In yen terms, Aflac Japan’s net premium income was ¥336.5 billion for the quarter, or 3.3% lower than a year ago, mainly due to limited-pay products reaching paid-up status. Net investment income, net of amortized hedge costs*, decreased 0.2% to ¥70.2 billion. Total revenues in yen declined 2.8% to ¥407.9 billion. Pretax adjusted earnings in yen for the quarter declined 11.6% on a reported basis. Pretax adjusted earnings decreased 11.1% on a currency-neutral basis. The pretax adjusted profit margin for the Japan segment was 19.4%, compared with 21.4% a year ago. The decrease in the profit margin is largely due to a reduction in revenues and an increase in expenses in the quarter.

For the first nine months, premium income in yen was ¥1.0 trillion, or 2.6% lower than a year ago. Net investment income, net of amortized hedge costs, increased 1.9% to ¥208.1 billion. Total revenues in yen were down 1.9% to ¥1.2 trillion. Pretax adjusted earnings were ¥262.3 billion, or 3.8% lower than a year ago.

In dollar terms, net premium income decreased 2.3% to $3.2 billion in the third quarter. Net investment income, net of amortized hedge costs, increased 0.6% to $663 million. Total revenues declined by 1.8% to $3.8 billion. Pretax adjusted earnings declined 10.9% to $747 million.

For the first nine months, premium income in dollars was $9.5 billion, or 1.2% lower than a year ago. Net investment income, net of amortized hedge costs, increased 3.2% to $1.9 billion. Total revenues were down 0.5% to $11.4 billion. Pretax adjusted earnings were $2.4 billion, or 2.5% lower than a year ago.

For the quarter, new annualized premium sales (sales) for protection-type first sector and third sector products decreased 32.8% to ¥12.2 billion, and total sales decreased 32.0% to ¥12.6 billion, or $119 million. For the first nine months, sales for protection-type first sector and third sector products decreased 41.1% to ¥35.3 billion, and total sales decreased 40.4% to ¥36.4 billion, or $339 million. The decline in sales largely reflects the impact of reduced activity during the COVID-19 pandemic.

AFLAC U.S.

Aflac U.S. net premium income declined 2.6% to $1.4 billion in the third quarter. Net investment income decreased 4.4% to $175 million as a result of the lower interest rate environment and ongoing capital management activity. Total revenues were down 1.5% to $1.6 billion, largely due to a decline in earned premium from reduced sales activity as well as lower net investment income, partially offset by $24 million of other income primarily derived from Argus third party administrative fees. Pretax adjusted earnings were $329 million, 1.8% lower than a year ago, primarily reflecting a decline in revenues and an increase in expenses, despite lower utilization during the pandemic. The pretax adjusted profit margin for the U.S. segment was 20.5%, compared with 20.6% a year ago.

For the first nine months, premium income declined 0.4% to $4.3 billion. Net investment income decreased 3.1% to $523 million. Total revenues were up 0.8% to $4.9 billion, reflecting $78 million of other income primarily derived from Argus third party administrative fees. Pretax adjusted earnings were $1.1 billion, or 8.6% higher than a year ago.

Aflac U.S. sales decreased 35.7% in the quarter to $221 million. For the first nine months of the year, total new sales decreased 32.7% to $705 million, reflecting the ongoing impact of the COVID-19 pandemic.

CORPORATE AND OTHER

For the quarter, total revenue decreased 10.3% to $87 million, primarily due to an $8 million decline in net investment income including amortized hedge income, which was $36 million. Pretax adjusted earnings were a loss of $39 million, compared with a loss of $17 million a year ago, primarily reflecting higher interest expense and lower net investment income including amortized hedge income.

For the first nine months of the year, total revenue increased 1.7% to $292 million, primarily due to an $11 million increase in net investment income including amortized hedge income, which was $137 million. Pretax adjusted earnings were a loss of $69 million, compared with a loss of $62 million a year ago, primarily reflecting increased interest expense and partially offset by an increase in amortized hedge benefits.

IMPACT OF NEW TAX REGULATIONS

On September 29, 2020, the U.S. Treasury and Internal Revenue Service issued Final and Proposed Regulations. Under the guidance of these regulations, the company will recognize a one-time income tax benefit of $1.4 billion due to the release of previously established valuation allowances related to deferred foreign tax credits. As a result, adjusted earnings benefited in the current period from a lower effective tax rate, and the company believes this will also reduce the effective tax rate in future periods, subject to any future changes in the U.S. tax policy.

DIVIDEND

The board of directors declared the fourth quarter dividend of $0.28 per share, payable on December 1, 2020 to shareholders of record at the close of business on November 18, 2020.

OUTLOOK

Commenting on the company’s results, Chairman and Chief Executive Officer Daniel P. Amos stated: "As a result of the global COVID-19 pandemic, many people have been facing the most challenging times of their lives for various reasons, and our thoughts and prayers are with everyone affected. The safety and health of everyone with whom we do business remains our greatest priority.

"The environment created by COVID-19 continues to impact our sales results both in the United States and Japan. As communicated, we expect this to significantly affect full year sales results in both countries, with the potential for a modest sales improvement for the remainder of the year, contingent upon the pace of economic recovery. Economic conditions and claims activity within this environment remain uncertain in both the Japan and the U.S. as both countries address the pandemic.

"We have taken several actions to navigate the pandemic in Japan and the U.S. Early in the fourth quarter, we offered a voluntary separation plan to eligible employees, which will result in a reduction in our U.S. insurance and corporate workforce of approximately 9%. We expect run-rate annual savings in the range of $45 to $50 million and will record a one-time expense associated with the separation plan of approximately $45 million in the fourth quarter. Other activities include a tactical approach to product development, investment in our distribution platforms, the promotion of wellness benefits with policyholders in the U.S., and accelerated investment in automation and digital roadmaps. You see the impact of these moves beginning to come through our results in the way of elevated investment, recovery in our benefit ratios and movement in persistency. While in total these activities represent short-term headwinds to pretax profit margins, they serve us well as we enter 2021 and an expected recovery in economic conditions.

"As always, we are committed to prudent liquidity and capital management. This includes maintaining strong capital ratios on behalf of our policyholders in both the U.S. and Japan and a tactical approach to capital allocation. It goes without saying that we treasure our record of dividend growth. With the fourth quarter’s declaration, 2020 will mark the 38th consecutive year of dividend increases. Our dividend track record is supported by the strength of our capital and cash flows. At the same time, we remain in the market repurchasing shares and focused on integrating the growth investments we have made in our platform. By doing so, we look to emerge from this period in a continued position of strength and leadership."

*See Non-U.S. GAAP Financial Measures section for an explanation of foreign exchange and its impact on the financial statements and definitions of the non-U.S. GAAP financial measures used in this earnings release, as well as a reconciliation of such non-U.S. GAAP financial measures to the most comparable U.S. GAAP financial measures.

On October 27, 2020 Regeneron Pharmaceuticals, Inc. (NASDAQ: REGN) reported that it will webcast management participation as follows (Press release, Regeneron, OCT 27, 2020, View Source [SID1234569153]):

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Credit Suisse 29th Annual Virtual Healthcare Conference at 8:45 a.m. EST on Monday, November 9, 2020
Cowen Virtual Presentation Series – 2020 IO Next Summit at 1:15 p.m. EST on Friday, November 13, 2020
Jefferies Virtual London Healthcare Conference at 7:20 a.m. EST (12:20 p.m. GMT) on Tuesday, November 17, 2020
The sessions may be accessed from the "Investors & Media" page of Regeneron’s website at View Source Replays of the webcasts will be archived on the Company’s website for at least 30 days.

On October 27, 2020 Mirati Therapeutics, Inc. (Nasdaq: MRTX) reported the pricing of an underwritten public offering of 4,335,397 shares of its common stock at a price to the public of $202.00 per share, which consists of 3,960,397 shares to be sold by Mirati and 375,000 shares to be sold by a selling stockholder (Press release, Mirati, OCT 27, 2020, View Source [SID1234569151]). The aggregate gross proceeds to Mirati from this offering are expected to be approximately $800.0 million, before deducting underwriting discounts and commissions and estimated offering expenses payable by Mirati. The offering is expected to close on or about October 30, 2020, subject to customary closing conditions. Mirati has also granted the underwriters a 30-day option to purchase up to an additional 625,309 shares of common stock in connection with the public offering and the selling stockholder has granted the underwriters a 30-day option to purchase up to an additional 25,000 shares of common stock in connection with the public offering. Mirati will not receive any proceeds from the sale of common stock by the selling stockholder.

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Mirati expects to use the net proceeds from this offering for general corporate purposes, including expenses related to the clinical and commercial development and manufacturing scale-up of adagrasib (MRTX849) and sitravatinib, the preclinical and clinical development of MRTX1133, a KRAS G12D inhibitor, and the development of other preclinical programs and the expansion of its organizational capabilities, including establishing commercial operations, and for working capital.

Goldman Sachs & Co. LLC, SVB Leerink LLC, Cowen and Company, LLC and Evercore Group, L.L.C. are acting as joint book-running managers in the offering. Barclays Capital Inc., Credit Suisse Securities (USA) LLC and Piper Sandler & Co. are also acting as book-running managers in the offering.

The shares of common stock described above are being offered pursuant to a shelf registration statement filed by Mirati with the Securities and Exchange Commission ("SEC") that became automatically effective upon filing. A preliminary prospectus supplement and accompanying prospectus relating to the offering were filed with the SEC and are available on the SEC’s website located at View Source Copies of the final prospectus supplement and the accompanying prospectus relating to the offering, when available, may be obtained from Goldman Sachs & Co. LLC, Attention: Prospectus Department, 200 West Street, New York, NY 10282, or by telephone at (866) 471-2526, or by email at [email protected]; or from SVB Leerink LLC, Attention: Syndicate Department, One Federal Street, 37th Floor, Boston, MA 02110, or by telephone at (800) 808-7525, ext. 6132, or by email at [email protected]; or from Cowen and Company, LLC, c/o Broadridge Financial Solutions, Attention: Prospectus Department, 1155 Long Island Avenue, Edgewood, NY 11717, or by telephone at (833) 297-2926, or by email at [email protected]; or from Evercore Group, L.L.C., Attention: Equity Capital Markets, 55 East 52nd Street, 35th Floor, New York, NY 10055, or by telephone at (888) 474-0200, or by email at [email protected].