On November 5, 2020 Sierra Oncology, Inc. (SRRA), a late-stage biopharmaceutical company focused on the Phase 3 execution, registration and potential commercialization of momelotinib, a novel drug that may address serious unmet needs in myelofibrosis, reported its financial and operational results for the third quarter ended September 30, 2020 (Press release, Sierra Oncology, NOV 5, 2020, View Source [SID1234570111]).

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"We continue to make good progress in our pivotal MOMENTUM Phase 3 trial for momelotinib and anticipate completing target enrollment by approximately mid-2021 and reporting top-line data in H1 2022, subject to any unforeseen impact from COVID-19," said Dr. Stephen Dilly, President and CEO of Sierra Oncology. "In addition, we anticipate presenting new analyses from previously completed Phase 3 studies of momelotinib at the American Society of Hematology (ASH) (Free ASH Whitepaper) annual meeting in December 2020."

"We are also developing our internal capabilities to support potential future regulatory filings and commercialization of momelotinib in the U.S., with key hires made recently in Regulatory Affairs, Technical Operations, Legal, Pharmacovigilance, Commercial, Business Development and Medical Affairs," added Dr. Dilly. "We remain well capitalized to complete enrollment for the MOMENTUM trial, report top-line results and to prepare for filing and pre-commercialization."

Third Quarter 2020 Financial Results (all amounts reported in U.S. currency)
Research and development expenses were $10.4 million for the three months ended September 30, 2020 compared with $10.1 million for the three months ended September 30, 2019. The increase was primarily due to a $1.5 million increase in clinical trial costs for momelotinib and a $0.3 million increase in personnel-related costs pertaining to an increase in stock-based compensation. These increases were offset by a $1.5 million decrease in clinical trial, third-party manufacturing, and research and preclinical costs for SRA737. Research and development expenses included non-cash stock-based compensation of $1.2 million and $0.9 million for the three months ended September 30, 2020 and 2019, respectively.

Research and development expenses were $32.2 million for the nine months ended September 30, 2020, compared with $32.0 million for the nine months ended September 30, 2019. The increase was primarily due to a $7.6 million increase in clinical trial and development costs for momelotinib, and a non-cash charge of $1.5 million pertaining to the change in fair value of an obligation to issue common stock and a warrant to Gilead Sciences, Inc. (Gilead), which were issued during the first quarter of 2020. These increases were offset by a $6.6 million decrease in clinical trial, third-party manufacturing, research and preclinical costs for SRA737, a $1.8 million decrease in personnel-related and allocated overhead costs, and a $0.5 million decrease in third-party manufacturing costs for momelotinib. Research and development expenses included non-cash stock-based compensation of $2.7 million and $3.3 million for the nine months ended September 30, 2020 and 2019, respectively.

General and administrative expenses were $4.1 million for the three months ended September 30, 2020, compared to $3.2 million for the three months ended September 30, 2019. The increase was due to an increase in personnel-related and allocated overhead costs of $0.7 million, primarily relating to an increase in stock-based compensation, and an increase of $0.2 million in professional fees. General and administrative expenses included non-cash stock-based compensation of $0.9 million and $0.4 million for the three months ended September 30, 2020 and 2019, respectively.

General and administrative expenses were $14.9 million for the nine months ended September 30, 2020, compared to $10.0 million for the nine months ended September 30, 2019. The increase was due to a $3.8 million increase in personnel-related and allocated overhead costs, including a non-cash $2.2 million stock-based compensation charge pertaining to the resignation of an executive and $1.0 million of severance charges, and an increase of $1.1 million in professional fees primarily relating to pre-commercial planning costs for momelotinib. General and administrative expenses included non-cash stock-based compensation of $4.0 million and $1.5 million for the nine months ended September 30, 2020 and 2019, respectively.

Other income (expense), net was $22,000 of other expense, net for the three months ended September 30, 2020, compared to $0.3 million of other income, net for the three months ended September 30, 2019. The difference was primarily attributable to a decrease in interest income due to lower interest rates. Other income (expense), net was $15.7 million of other expense, net for the nine months ended September 30, 2020, compared to $1.0 million of other income, net for the nine months ended September 30, 2019. The difference was primarily attributable to a non-cash charge of $16.2 million related to the change in fair value of warrant liabilities which were reclassified to equity in January 2020.

For the three months ended September 30, 2020, Sierra incurred a Generally Accepted Accounting Principles (GAAP) net loss of $14.5 million compared to a GAAP net loss of $12.9 million for the three months ended September 30, 2019. For the nine months ended September 30, 2020, Sierra incurred a GAAP net loss of $62.9 million compared to a GAAP net loss of $40.8 million for the nine months ended September 30, 2019. The GAAP net loss for the nine months ended September 30, 2020 includes a non-cash charge of $16.2 million related to the change in fair value of warrant liabilities included in other income (expense), net and a $1.5 million non-cash charge pertaining to the obligation to issue securities to Gilead included in research and development expenses as mentioned above.

Non-GAAP adjusted net loss was $12.4 million for the three months ended September 30, 2020, compared with a non-GAAP adjusted net loss of $11.6 million for the three months ended September 30, 2019. Non-GAAP adjusted net loss for the three months ended September 30, 2020 and 2019 excludes expenses related to stock-based compensation. For the nine months ended September 30, 2020, Sierra incurred a non-GAAP adjusted net loss of $38.5 million compared to a non-GAAP adjusted net loss of $36.1 million for the nine months ended September 30, 2019. Non-GAAP adjusted net loss for the nine months ended September 30, 2020 excludes expenses related to the change in fair value of warrant liabilities, the change in fair value of the securities issuance obligation, and stock-based compensation. Non-GAAP adjusted net loss for the nine months ended September 30, 2019 excludes expenses related to stock-based compensation. See "Non-GAAP Financial Measures" and "Reconciliation of GAAP to Non-GAAP Financial Measures" below for a reconciliation of this GAAP and non-GAAP financial measure.

Cash and cash equivalents totaled $109.0 million as of September 30, 2020, compared to $147.5 million as of December 31, 2019.

As of September 30, 2020, there were 10,495,732 total shares of common stock outstanding and warrants to purchase 11,102,251 shares of common stock, with an exercise price equal to $13.20 per share. There were 4,246,167 shares issuable upon exercise of stock options and an additional warrant to purchase 1,839 shares.

On November 5, 2020 Agios Pharmaceuticals, Inc. (NASDAQ: AGIO), a leader in the field of cellular metabolism to treat cancer and rare genetic diseases, reported business highlights and financial results for the third quarter ended September 30, 2020 (Press release, Agios Pharmaceuticals, NOV 5, 2020, View Source [SID1234570110]).

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"In the third quarter, we made significant strides toward executing against our key 2020 priorities and getting our medicines to patients who need them," said Jackie Fouse, Ph.D., chief executive officer at Agios. "Most notably, we generated mature overall survival data from our Phase 3 ClarIDHy study of TIBSOVO in previously treated cholangiocarcinoma, prepared for topline data readouts from our two global Phase 3 studies of mitapivat in pyruvate kinase deficiency and advanced our pivotal plans for mitapivat in thalassemia and sickle cell disease. We look forward to building on these achievements with a catalyst-rich fourth quarter and 2021."

THIRD QUARTER 2020 & RECENT HIGHLIGHTS

TIBSOVO (ivosidenib tablets) net sales of $31.7 million, an increase of 15% from the second quarter of 2020.
Reported topline mature overall survival results from ClarIDHy Phase 3 study of TIBSOVO in previously treated IDH1-mutant cholangiocarcinoma patients; submitted final data for presentation at the virtual American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Gastrointestinal Cancers Symposium (ASCO GI).
Withdrew European Marketing Authorization Application (MAA) for TIBSOVO in IDH1-mutant relapsed or refractory acute myeloid leukemia (AML) as a result of feedback from European Medicine Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP).
Initiated Phase 1 healthy volunteers study of AG-946, a next-generation, orally available, small molecule activator of the metabolic enzyme pyruvate kinase-R (PKR).
Appointed Jonathan Biller as chief financial officer, head of legal and corporate affairs.
KEY UPCOMING MILESTONES

Rare Genetic Diseases

Report topline data from ACTIVATE, the company’s global pivotal trial for mitapivat in adults with pyruvate kinase (PK) deficiency who do not receive regular transfusions, by the end of 2020.
Report topline data from ACTIVATE-T, the company’s global pivotal trial for mitapivat in adults with pyruvate kinase (PK) deficiency who receive regular transfusions, in Q1 2021.
Finalize pivotal development plan for mitapivat in thalassemia, including both α-and β-thalassemia, as well as transfusion dependent and non-transfusion dependent patient populations, by the end of 2020.
Finalize pivotal development plan for mitapivat in sickle cell disease in the first half of 2021.
Hematologic Malignancies and Solid Tumors

Deliver full-year 2020 U.S. revenue for TIBSOVO of $113-115 million; the company had previously provided guidance of $105-115 million.
Submit a supplemental new drug application for TIBSOVO in previously treated cholangiocarcinoma in Q1 2021.
Research

Achieve at least one new development candidate by year-end 2020.
UPCOMING INVESTOR EVENTS

November 19, 2020: Agios will host a webinar focused on its pyruvate kinase-R (PKR) activation clinical programs, including Agios’ leadership in elucidating the PKR activation mechanism, the commercial opportunity for each program and the company’s preparations for its first potential launch in a rare genetic disease, expected in 2022.
December 8, 2020: Agios will host a webinar to share updated data from the Phase 1 trial of mitapivat in sickle cell disease, which is being conducted in collaboration with the National Institutes of Health (NIH), as well as an overview of the company’s Phase 3 development plans for mitapivat in patients with thalassemia.
THIRD QUARTER 2020 FINANCIAL RESULTS

Revenue: Total revenue for the third quarter of 2020 was $34.7 million, which includes $31.7 million of net product revenue from sales of TIBSOVO, $2.3 million in collaboration revenue and $0.7 million in royalty revenue from net global sales of IDHIFA under our collaboration agreement with Celgene, now a wholly owned subsidiary of Bristol Myers Squibb. This compares to revenue of $26.0 million for the third quarter of 2019. Total revenue increased 33% from the same period last year, driven by an 82% increase in TIBSOVO net product revenue and offset by a decrease in collaboration revenue due to completion of the research and development services performance obligation with Celgene in the second quarter, as well as an adjustment in sales reserves taken in the third quarter by Bristol Myers Squibb.

Cost of Sales: Cost of sales were $0.6 million for the third quarter of 2020 compared to $0.4 million for the third quarter of 2019.

Research and Development (R&D) Expenses: R&D expenses were $89.6 million for the third quarter of 2020 compared to $101.7 million for the third quarter of 2019. The decrease in R&D expense was primarily attributable to a decrease in TIBSOVO clinical development costs, including winding down the ClarIDHy Phase 3 study.

Selling, General and Administrative (SG&A) Expenses: SG&A expenses were $34.8 million for the third quarter of 2020 compared to $33.0 million for the third quarter of 2019. The increase in SG&A expense was primarily attributable to increased workforce expenses, offset by a decrease in external spending due to COVID-19 and cost savings initiatives.

Net Loss: Net loss was $99.0 million for the third quarter of 2020 compared to $106.2 million for the third quarter of 2019.

Cash Position and Guidance: Cash, cash equivalents and marketable securities as of September 30, 2020 were $722.4 million, compared to $540.5 million as of September 30, 2019. The company expects that its cash, cash equivalents and marketable securities as of September 30, 2020, together with anticipated product revenue, anticipated interest income and anticipated expense reimbursements under our collaboration and license agreements, but excluding any additional program-specific milestone payments, will enable the company to fund its anticipated operating expenses and capital expenditure requirements to the end of 2022.

CONFERENCE CALL INFORMATION
Agios will host a conference call and live webcast with slides today at 8:00 a.m. ET to discuss its third quarter 2020 financial results and recent business activities. To participate in the conference call, please dial 1-877-377-7098 (domestic) or 1-631-291-4547 (international) and refer to conference ID 7578909. The live webcast can be accessed under "Events & Presentations" in the Investors section of the company’s website at www.agios.com. The archived webcast will be available on the company’s website beginning approximately two hours after the event.

About the Agios/Celgene Collaboration
In 2010, Agios and Celgene Corporation, now a wholly owned subsidiary of Bristol Myers Squibb, entered into a collaboration agreement focused on cancer metabolism. Under the terms of the agreement, Celgene has worldwide development and commercialization rights for IDHIFA (enasidenib). Celgene and Agios are currently co-commercializing IDHIFA in the U.S., and Agios continues to conduct certain clinical development activities within the IDHIFA development program. Agios is eligible to receive a $25 million payment upon achievement of a specified ex-U.S. commercial milestone event, as well as reimbursement for costs incurred for its co-commercialization efforts and development activities.

On November 5, 2020 Incyte (Nasdaq: INCY) reported 2020 third quarter financial results, and provides a status update on the Company’s development portfolio (Press release, Incyte, NOV 5, 2020, View Source [SID1234570109]).

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"We are pleased to report another strong quarter for Incyte, with continued strength across all Jakafi (ruxolitinib) indications, good momentum behind the U.S. launches of both Monjuvi (tafasitamab-cxix) and Pemazyre (pemigatinib), as well as increasing royalty contributions from our partnered medicines globally," stated Hervé Hoppenot, Chief Executive Officer, Incyte. "In addition, we have now established Incyte Dermatology as a new franchise for Incyte in the U.S., and we are on track to submit the NDA for ruxolitinib cream at the end of this year which, by using our priority review voucher, could lead to an FDA decision in the middle of next year."

Portfolio Update

LIMBER – key highlights

Two pivotal trials are being initiated to evaluate the combination of ruxolitinib and parsaclisib as both first-line therapy for myelofibrosis (MF) patients and in MF patients with an inadequate response to ruxolitinib monotherapy.

The Phase 2 monotherapy trial of INCB57643 (BET) in patients with refractory myelofibrosis are now recruiting and the Phase 2 monotherapy trial of INCB00928 (ALK2) in patients with myelofibrosis is being opened. Both programs are expected to proceed to ruxolitinib combination trials upon completion of monotherapy cohorts.

Indication and status

Once-a-day ruxolitinib
(JAK1/JAK2)

Myelofibrosis and polycythemia vera: clinical pharmacology studies

ruxolitinib + parsaclisib
(JAK1/JAK2 + PI3Kδ)

Myelofibrosis: Phase 3 in preparation
Myelofibrosis: Phase 3 in preparation (inadequate responders to ruxolitinib)

ruxolitinib + INCB57643
(JAK1/JAK2 + BET)

Myelofibrosis: Phase 2 in preparation

ruxolitinib + INCB00928
(JAK1/JAK2 + ALK2)

Myelofibrosis: Phase 2 in preparation

Oncology beyond MPNs – key highlights

In August, Monjuvi (tafasitamab-cxix) in combination with lenalidomide was included in the latest National Comprehensive Cancer Network (NCCN) Clinical Practice Guidelines in Oncology for B-cell Lymphomas with a Category 2A designation as an option for the treatment of adult patients with relapsed or refractory diffuse large B-cell lymphoma (r/r DLBCL) and who are not eligible for autologous stem cell transplant (ASCT).

The European Marketing Authorization Application (MAA) for tafasitamab as a treatment for patients with r/r DLBCL is under review. Incyte has exclusive development and commercialization rights to tafasitamab outside of the U.S.

Incyte and MorphoSys plan to further broaden the development program of tafasitamab in other B-cell malignancies. Multiple trials are in preparation, including Phase 3 trials in both first line DLBCL and relapsed/refractory follicular lymphoma, as well as a proof-of-concept trial of tafasitamab plus parsaclisib (PI3Kδ).

In September, initial results from the Phase 2 POD1UM-202 trial of retifanlimab in previously treated patients with advanced squamous cell anal carcinoma (SCAC) who have progressed following standard platinum-based chemotherapy were presented at the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) annual meeting. The Phase 3 POD1UM-303 trial of retifanlimab in combination with platinum-based chemotherapy as a first-line treatment for patients with SCAC is open for recruitment.

Given the rapidly evolving treatment landscape for bladder cancer and recent regulatory feedback, Incyte is reevaluating its development strategy for pemigatinib in bladder cancer. As part of that reevaluation, new patient recruitment into FIGHT-205, which is assessing pemigatinib in cisplatin-ineligible bladder cancer patients whose tumors express FGFR3 mutation or rearrangement, has been stopped, and Incyte no longer intends to use data from FIGHT-201 to seek accelerated approval for pemigatinib in patients with previously treated bladder cancer whose tumors express FGFR3 mutation or rearrangement.

Indication and status

ruxolitinib
(JAK1/JAK2)

Steroid-refractory chronic GVHD: Phase 3 (REACH3)1 primary endpoint met

itacitinib
(JAK1)

Treatment-naïve chronic GVHD: Phase 3 (GRAVITAS-309)

pemigatinib
(FGFR1/2/3)

CCA: Phase 2 (FIGHT-202), Phase 3 (FIGHT-302); MAA, NDS and J-NDA under review

8p11 MPN: Phase 2 (FIGHT-203)

Tumor agnostic: Phase 2 (FIGHT-207)

tafasitamab

(CD19)2

r/r DLBCL: Phase 2 (L-MIND); Phase 3 (B-MIND); MAA under review

1L DLBCL: Phase 1b (First-MIND); Phase 3 (Front-MIND) in preparation

r/r follicular lymphoma: Phase 3 in preparation

r/r B-cell malignancies: PoC with parsaclisib (PI3Kδ) in preparation

parsaclisib
(PI3Kδ)

r/r follicular lymphoma: Phase 2 (CITADEL-203)

r/r marginal zone lymphoma: Phase 2 (CITADEL-204)

r/r mantle cell lymphoma: Phase 2 (CITADEL-205)

retifanlimab
(PD-1)3

MSI-high endometrial cancer: Phase 2 (POD1UM-101); Phase 2 (POD1UM-204) in preparation

Merkel cell carcinoma: Phase 2 (POD1UM-201)

SCAC: Phase 2 (POD1UM-202); Phase 3 (POD1UM-303) open for recruitment

NSCLC: Phase 3 (POD1UM-304)

CCA = cholangiocarcinoma; DLBCL = diffuse large B-cell lymphoma; SCAC = squamous cell anal carcinoma
1)

Clinical development of ruxolitinib in GVHD conducted in collaboration with Novartis

2)

Development of tafasitamab in collaboration with MorphoSys

3)

retifanlimab licensed from MacroGenics

Inflammation and Autoimmunity (IAI) – key highlights

Dermatology

Incyte Dermatology has been established as a new franchise for Incyte in the U.S., which will include dedicated teams for the development and commercialization of Incyte’s dermatology portfolio.

The NDA for ruxolitinib cream in atopic dermatitis is on track for submission at the end of 2020. Incyte has acquired a priority review voucher, which it intends to use to accelerate the timeline to FDA decision.

Pooled results from the TRuE-AD studies were presented at the European Academy of Dermatology and Venereology (EADV) Congress. Ruxolitinib cream demonstrated clinically meaningful improvements in patient-reported quality of life assessments, such as the PROMIS (patient-reported outcomes measurement information system) sleep disturbance (8b) score, as well as substantial and sustained itch reduction, reinforcing its potential as an important treatment option for atopic dermatitis patients.

The two randomized Phase 3 trials in the TRuE-V pivotal program evaluating ruxolitinib cream in patients with vitiligo are fully recruited, with results expected in 2021.

Other IAI

Initial clinical results from INCB54707, a JAK1 selective inhibitor, were presented in October. INCB54707 demonstrated preliminary efficacy, improved quality of life (QoL) including a reduction in skin pain and a tolerable safety profile in patients with moderate-to-severe hidradenitis suppurativa (HS). A Phase 2b, randomized, double-blind, placebo-controlled trial evaluating INCB54707 in HS is ongoing.

Indication and status

ruxolitinib cream
(JAK1/JAK2)

Atopic dermatitis: Phase 3 (TRuE-AD1, TRuE-AD2; primary endpoints met)

Vitiligo: Phase 3 (TRuE-V1, TRuE-V2)

INCB54707
(JAK1)

Hidradenitis suppurativa: Phase 2b

parsaclisib
(PI3Kδ)

Autoimmune hemolytic anemia: Phase 2

INCB00928
(ALK2)

Fibrodysplasia ossificans progressiva: Phase 2 in preparation

Discovery and early development – key highlights

Incyte’s portfolio of other earlier-stage clinical candidates is summarized below.

Clinical translational data from the ongoing proof-of-concept trial of INCB86550, Incyte’s first-in-class oral small molecule inhibitor of PD-L1, have been accepted for presentation at the 2020 Society for Immunotherapy for Cancer (SITC) (Free SITC Whitepaper) meeting. As previously disclosed, initial clinical efficacy and safety data from this trial are expected to be presented in 2021, once these data mature.

Modality

Candidates

Small molecules

INCB01158 (ARG)1, INCB81776 (AXL/MER), epacadostat (IDO1), INCB86550 (PD-L1)

Monoclonal antibodies2

INCAGN1876 (GITR), INCAGN2385 (LAG-3), INCAGN1949 (OX40), INCAGN2390 (TIM-3)

Bispecific antibodies

MCLA-145 (PD-L1xCD137)3

1)
INCB01158 licensed from Calithera

2)
Discovery collaboration with Agenus

3)
MCLA-145 development in collaboration with Merus

Potential therapies for patients with COVID-19

Patient recruitment into the Phase 3 RUXCOVID study evaluating ruxolitinib versus standard-of-care in hospitalized patients with COVID-19 associated cytokine storm has been completed, and topline results are expected to be available before the end of 2020.

In September, Incyte and Eli Lilly announced initial results from the baricitinib arm of the National Institute of Allergy and Infectious Diseases (NIAID) Adaptive COVID-19 Treatment Trial (ACTT-2), where baricitinib in combination with remdesivir reduced the time to recovery (primary endpoint) in comparison with remdesivir alone.

Additional data announced in October showed that baricitinib plus remdesivir resulted in a numerical decrease in mortality through Day 29 compared to remdesivir alone, with a more pronounced reduction seen in more severely ill patients.

Status

ruxolitinib
(JAK1/JAK2)

COVID-19 associated cytokine storm: Phase 3 (RUXCOVID1; DEVENT)

baricitinib
(JAK1/JAK2)2

Hospitalized patients with COVID-19: Phase 3 (ACTT-23; COV-BARRIER)

1)
Sponsored by Incyte in the United States and by Novartis outside of the United States

2)
Worldwide rights to baricitinib licensed to Lilly: approved as Olumiant in multiple territories globally for certain patients with moderate-to-severe rheumatoid arthritis; approved as Olumiant in EU for moderate to severe atopic dermatitis.

3)
ACTT-2 agreement with the National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health

Partnered – key highlights

In October, Lilly announced that the European Commission granted marketing authorization for Olumiant (baricitinib) 4mg and 2mg tablets in Europe for the treatment of adults with moderate to severe atopic dermatitis (AD) who are candidates for systemic therapy, becoming the first JAK-inhibitor indicated to help treat patients with AD.

In September, Incyte and Novartis announced that GEOMETRY mono-1 results of TabrectaTM (capmatinib) in patients with METex14 metastatic non-small cell lung cancer (NSCLC) were published in The New England Journal of Medicine.

Indication and status

baricitinib
(JAK1/JAK2)1

Atopic dermatitis: Phase 3 (BREEZE-AD); approved in EU

Systemic lupus erythematosus: Phase 3

Severe alopecia areata: Phase 3 (BRAVE-AA1, BRAVE-AA2)

capmatinib
(MET)2

NSCLC (with MET exon 14 skipping mutations): Approved as Tabrecta in U.S. and Japan

Worldwide rights to baricitinib licensed to Lilly: approved as Olumiant in multiple territories globally for certain patients with moderate-to-severe rheumatoid arthritis

Worldwide rights to capmatinib licensed to Novartis

2020 Third Quarter Financial Results

The financial measures presented in this press release for the three and nine months ended September 30, 2020 and 2019 have been prepared by the Company in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), unless otherwise identified as a Non-GAAP financial measure. Management believes that Non-GAAP information is useful for investors, when considered in conjunction with Incyte’s GAAP disclosures. Management uses such information internally and externally for establishing budgets, operating goals and financial planning purposes. These metrics are also used to manage the Company’s business and monitor performance. The Company adjusts, where appropriate, for expenses in order to reflect the Company’s core operations. The Company believes these adjustments are useful to investors by providing an enhanced understanding of the financial performance of the Company’s core operations. The metrics have been adopted to align the Company with disclosures provided by industry peers.

Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used in conjunction with and to supplement Incyte’s operating results as reported under GAAP. Non-GAAP measures may be defined and calculated differently by other companies in our industry.

Financial Highlights

Product and Royalty Revenues Product and royalty revenues for the three and nine months ended September 30, 2020 increased 16% and 19%, respectively, over the prior year comparative periods primarily as a result of increases in Jakafi net product revenues, the launch of Pemazyre and higher product royalty revenues from Jakavi and Olumiant. Jakafi net product revenues for the three and nine months ended September 30, 2020 increased 13% and 17%, respectively, over the prior year comparative periods, primarily driven by growth in patient demand across all indications.

1. Non-GAAP cost of product revenues excludes the amortization of licensed intellectual property for Iclusig relating to the acquisition of the European business of ARIAD Pharmaceuticals, Inc. and the cost of stock-based compensation.
2. Non-GAAP research and development expenses exclude the cost of stock-based compensation.
3. Non-GAAP selling, general and administrative expenses exclude the cost of stock-based compensation.
4. Non-GAAP change in fair value of acquisition-related contingent consideration is null.

Research and development expenses GAAP and Non-GAAP research and development expense for the three months ended September 30, 2020 increased 56% and 63%, respectively, compared to the same period in 2019, primarily due to $120 million of expense related to the purchase of an FDA priority review voucher from a third party, which we intend to use to accelerate the FDA review of ruxolitinib cream for the treatment of atopic dermatitis and an increase in milestone expenses related to our collaborative agreements. For the nine months ended September 30, 2020, GAAP and Non-GAAP research and development expense increased 115% and 128%, respectively, compared to the same period in 2019, primarily due to upfront consideration of $805 million related to our collaborative agreement with MorphoSys and expense related to the purchase of the FDA priority review voucher.

Selling, general and administrative expenses GAAP and Non-GAAP selling, general and administrative expenses for the three months and nine months ended September 30, 2020 increased 18% and 5%, respectively, compared to the same periods in 2019, primarily due to increased headcount and activities supporting the commercialization of our products and the timing of certain expenses.

Other Financial Information

Operating income (loss) GAAP and Non-GAAP operating income for the three months ended September 30, 2020 decreased compared to the same period in 2019, primarily due to $120 million of expense related to the purchase of the FDA priority review voucher and milestone expenses related to our collaborative agreements. For the nine months ended September 30, 2020 we recorded an operating loss compared to operating income for the same period in 2019, on both a GAAP and Non-GAAP basis, primarily due to upfront consideration related to our collaboration with MorphoSys and expense related to the FDA priority review voucher, partially offset by the growth in product and royalty revenues.

Cash, cash equivalents and marketable securities position As of September 30, 2020 and December 31, 2019, cash, cash equivalents and marketable securities totaled $1.7 billion and $2.1 billion, respectively. The decrease is primarily driven by the upfront payment and stock purchase related to our collaborative agreement with MorphoSys and purchase of the FDA priority review voucher and is partially offset by the cash flow generated during this nine-month period.

2020 Financial Guidance

Incyte has tightened its full year 2020 guidance for Jakafi net product revenues, as detailed below. The company’s full year 2020 financial guidance is summarized in the following table. The R&D expense guidance excludes $805 million of upfront consideration paid under the MorphoSys collaboration and $120 million of expense related to the purchase of the FDA priority review voucher (PRV). The financial guidance also excludes the impact of any potential future strategic transactions.

1. Amounts exclude Non-GAAP adjustments (e.g., stock based comp, amortization of acquired product rights for Iclusig and change in fair value of estimated future royalties for Iclusig). Research and development expenses also excludes $805 million of upfront consideration paid under the MorphoSys collaboration and $120 million of expense related to the purchase of the FDA priority review voucher.

Conference Call and Webcast Information

Incyte will hold a conference call and webcast this morning at 8:00 a.m. EDT. To access the conference call, please dial 877-407-3042 for domestic callers or 201-389-0864 for international callers. When prompted, provide the conference identification number, 13711777.

If you are unable to participate, a replay of the conference call will be available for 90 days. The replay dial-in number for the United States is 877-660-6853 and the dial-in number for international callers is 201-612-7415. To access the replay you will need the conference identification number, 13711777.

The conference call will also be webcast; the livestream and the replay can be accessed at investor.incyte.com.

On November 5, 2020 Bicycle Therapeutics plc (NASDAQ:BCYC), a biotechnology company pioneering a new and differentiated class of therapeutics based on its proprietary bicyclic peptide (Bicycles) technology, reported financial results for the third quarter ended September 30, 2020 and discussed recent corporate updates (Press release, Bicycle Therapeutics, NOV 5, 2020, View Source [SID1234570108]).

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"Amidst the uncertainty brought on by the COVID-19 pandemic, Bicycle has made significant advances during the third quarter, including the initiation of dosing in a Phase IIa trial of BT1718, in a Phase I/II trial of BT8009, and in Oxurion’s Phase II study of THR-149," said Kevin Lee, Ph.D., Chief Executive Officer of Bicycle Therapeutics. "As we advance and expand our clinical portfolio, with multiple potential inflection points in the coming year, we have thoughtfully bolstered our balance sheet through our ATM program and the closing of a non-dilutive debt financing. We have also enhanced Bicycle’s clinical leadership with the appointment of Dominic Smethurst as Chief Medical Officer and the addition of prominent scientists and clinicians to our Scientific Advisory Board, now chaired by renowned immunologist Sir Keith Peters. We believe we are well-positioned as we pursue our goal of realizing the full potential of our disruptive Bicycle technology."

Third Quarter 2020 and Recent Highlights

Announced Expansion of the Scientific Advisory Board (SAB). In October 2020, Bicycle announced that Drs. Garret FitzGerald, Jane Grogan, Caetano Reis e Sousa, and Charles Swanton have joined the Company’s SAB. The SAB works closely with Bicycle’s senior management team to advance the Company’s growing pipeline of potential Bicycle-based treatments for cancer and other difficult-to-treat diseases.
Raised $50 Million Through At-the-Market (ATM) Offering Program and Entered into Debt Financing from Hercules Capital. Also in October, Bicycle announced that it had utilized its ATM offering program, initiated during the third quarter, generating gross proceeds of $50.0 million. In addition, it closed a debt financing with Hercules Capital, Inc. for a term loan of up to $40.0 million, $15.0 million of which was drawn at closing.
Presented Trials in Progress Poster for BT8009 at the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) Virtual Congress 2020. The poster describes the design of the ongoing Phase I/II trial of BT8009 in advanced solid tumors associated with Nectin-4 expression. BT8009 is a second-generation, Nectin-4 targeting Bicycle Toxin Conjugate (BTC).
Dosed First Patient in Phase I Dose Escalation Portion of Phase I/II Trial of BT8009 in Patients with Advanced Solid Tumor Malignancies. In September 2020, Bicycle announced that the first patient had been dosed in the Phase I dose escalation portion of its Phase I/II trial of BT8009 in patients with advanced solid tumors associated with Nectin-4 expression.
Dosed First Patient in Phase IIa Expansion Portion of Phase I/IIa Trial, Sponsored by Cancer Research UK, Evaluating BT1718 in Patients with MT1-MMP-Positive Tumors. Also in September, Bicycle announced that the first patient had been dosed in the Phase IIa expansion portion of a Phase I/IIa trial of BT1718 in a cohort of patients with MT1-MMP-positive squamous non-small cell lung cancer (NSCLC) and in a basket cohort of patients with other MT1-MMP-positive solid tumors. BT1718 is a BTC targeting the tumor antigen MT1-MMP.
Announced First Patient Dosed in Oxurion’s Phase II Study of THR-149 in Patients with Diabetic Macular Edema (DME). In September, Bicycle announced that the first patient had been dosed in Oxurion’s Phase II study of THR-149, a novel Bicycle-based plasma kallikrein (PKal) inhibitor, in patients with DME. The Phase II trial, named KALAHARI, is expected to include approximately 122 patients with central involved DME who do not respond adequately to anti-VEGF therapy.
Awarded Innovate UK Grant to Pursue Exploratory Research into Novel Bicycle-based Interventions for SARS-CoV-2. In response to an invitation from the UK government, Bicycle applied for, and was awarded, $2.8 million to explore the utility of Bicycle technology to generate binders to a range of SARS-CoV-2 targets. The application of the Bicycle platform to address the ongoing COVID-19 pandemic could enable the development of next-generation antivirals and diagnostics. Furthermore, this application of Bicycles offers a rapid and differentiated approach that can be swiftly deployed in response to current and future viral threats.
Appointed Dominic Smethurst as Chief Medical Officer. The Company appointed Dominic Smethurst, MBchB, MRCP, MFPM as Chief Medical Officer in August 2020. Dr. Smethurst brings to Bicycle extensive expertise in developing bispecific immuno-oncology agents, as well as toxin conjugate therapeutics for cancer and other diseases where patients experience high unmet medical need.
Upcoming Investor Presentations

Bicycle will present at the following investor conferences in the fourth quarter of 2020. The conferences will be held in a virtual meeting format:

Jefferies Global Healthcare Conference on Thursday, November 19, 2020 at 1:10 p.m. ET
Piper Sandler 32nd Annual Healthcare Conference, December 1-3, 2020
A live webcast of each presentation will be accessible in the Investors & Media section of Bicycle’s website at bicycletherapeutics.com. Archived replays of the webcasts will be available for 90 days following the presentation dates.

Financial Results

Cash and cash equivalents were $149.8 million as of September 30, 2020, compared to $92.1 million as of December 31, 2019. The increase in cash is primarily due to net proceeds of $46.4 million from the ATM offering and net proceeds of $14.6 million from a Loan Agreement with Hercules, offset by cash used in operating activities. Cash at September 30, 2020 does not include net proceeds of $1.8 million from the ATM offering received in October 2020.
Research and development expenses totaled $7.4 million for the three months ended September 30, 2020, compared to $6.1 million for the three months ended September 30, 2019. The increase of $1.3 million was primarily due to increased clinical program expenses for BT5528 and BT8009, partially offset by lower development expenses of other programs due to timing, and an increase in personnel related costs, including $0.3 million of incremental non-cash share-based compensation expense.
General and administrative expenses were $7.2 million for the three months ended September 30, 2020, compared to $4.8 million for the three months ended September 30, 2019. The increase of $2.4 million was primarily due to an increase in professional fees and costs related to operations as a public company, offset by favorable effect of foreign exchange rates, and an increase in personnel related costs, including $0.4 million of incremental non-cash share-based compensation expense.
Net loss was $10.1 million, or $(0.52) basic and diluted net loss per share, for the three months ended September 30, 2020, compared to net loss of $9.5 million, or $(0.53) basic and diluted net loss per share, for the three months ended September 30, 2019.

On November 5, 2020 Cardinal Health (NYSE: CAH) reported first quarter fiscal year 2021 revenues of $39.1 billion, an increase of 5% from the first quarter of last year (Press release, Cardinal Health, NOV 5, 2020, View Source [SID1234570107]). First quarter GAAP operating loss was $624 million due to a $1.0 billion pre-tax accrual related to opioid litigation. This quarter’s accrual is incremental to the $5.6 billion accrual recorded in the first quarter of fiscal year 2020. Non-GAAP operating earnings increased 7% to $618 million in the quarter. GAAP diluted loss per share was $0.86, and non-GAAP diluted earnings per share (EPS) increased 19% to $1.51. These results include a moderate negative impact from COVID-19, primarily concentrated in the Pharmaceutical segment.

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Cardinal Health, Inc. is a global, integrated healthcare services and products company, providing customized solutions for hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories and physician offices worldwide. (PRNewsfoto/Cardinal Health)

"Our first quarter results and improved outlook for the year demonstrate the resilience of our business model," said Mike Kaufmann, CEO of Cardinal Health. "We delivered strong performance in both segments due to progress against our growth initiatives and disciplined expense management. As we continue to navigate the pandemic, we remain focused on optimizing our core businesses and making strategic investments that create long-term value for our shareholders, customers, communities and employees."

Q1 FY21 summary

First quarter revenue for the Pharmaceutical segment increased 5% to $35.1 billion, driven by sales growth from Pharmaceutical Distribution and Specialty Solutions customers.

Pharmaceutical segment profit increased 1% to $402 million in the first quarter, due to a higher contribution from brand sales mix. As expected, segment profit growth was adversely affected by COVID-19-related volume declines.

First quarter revenue for the Medical segment increased 1% to $4.0 billion, primarily due to sales growth from Cardinal Health at Home.

Medical segment profit increased 36% to $230 million in the first quarter due to cost savings, including global manufacturing efficiencies. The company estimates that COVID-19 had a minimal net impact on the segment’s first quarter results, as the adverse effects of cancelled or deferred elective procedures were offset by the temporary reduction of certain costs and higher volumes in our lab business. Additionally, the impact of personal protective equipment (PPE) cost increases was mostly mitigated through price increases.

Fiscal year 2021 outlook1
Cardinal Health is updating its fiscal year 2021 guidance range for non-GAAP diluted earnings per share attributable to Cardinal Health, Inc. to $5.65 to $5.95 from $5.25 to $5.65. This increased guidance range primarily reflects a combination of a lower-than-previously-expected net headwind related to COVID-19 and improved cost savings.

The company does not provide forward-looking guidance on a GAAP basis as certain financial information, the probable significance of which cannot be determined, is not available and cannot be reasonably estimated. See "Use of Non-GAAP Measures" following the attached schedules for additional explanation.

Opioid lawsuits developments
In October 2019, the company agreed in principle to a global settlement framework with a leadership group of state attorneys general that is designed to resolve all pending and potential opioid lawsuits by states and political subdivisions. Negotiations under this settlement framework continue. In connection with the opioid lawsuits and these discussions, in the first quarter of fiscal year 2021, the company incurred a pre-tax charge of $1.02 billion. This is incremental to the $5.63 billion charge incurred in the first quarter of fiscal year 2020. The total pre-tax accrual for these matters at September 30, 2020 is $6.59 billion. These charges are excluded from the company’s non-GAAP results.

GAAP tax effect of opioid litigation charges
For fiscal 2021, including the tax effects of opioid litigation charges in the calculation of the company’s estimated annual effective tax rate increased the amount of tax benefit in the current quarter by approximately $450 million and is expected to significantly increase the company’s provision for income taxes during the remainder of the fiscal year. The company currently estimates net tax benefits of $35 million and $488 million for fiscal 2021 and 2020 in connection with the opioid lawsuit developments.

Recent highlights

Cardinal Health announced that Sheri Edison joined the board of directors effective September 1. Ms. Edison currently serves as Executive Vice President and General Counsel for Amcor plc.
Cardinal Health board of directors approved a quarterly dividend of $0.4859 per share. The dividend will be payable on January 15, 2021 to shareholders of record at the close of business on January 4, 2021.
Cardinal Health continues to be recognized for its Diversity and Inclusion efforts, recently in the Forbes 2020 America’s Best Employers for Women list, the Diversity Best Practices (DBP) Inclusion Index, and the 2020 LATINA Style, Inc. 50 report.
Upcoming webcasted investor events

Credit Suisse 29th Annual Healthcare Conference at 1:15 p.m. EST, November 9
39th Annual J.P. Morgan Healthcare Conference on January 11-14, 2021
Webcast
Cardinal Health will host a webcast today at 8:30 a.m. EST to discuss first quarter results. To access the webcast and corresponding slide presentation, go to the Investor Relations page at ir.cardinalhealth.com. No access code is required.

Presentation slides and a webcast replay will be available until November 4, 2021.