OncoNano Medicine Announces Oral Presentation at the American Society of Clinical Oncology (ASCO) Annual Meeting 2023

On April 27, 2023 OncoNano Medicine, Inc. reported an oral presentation at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting 2023, taking place June 2-6, 2023 at McCormick Place, Chicago, Illinois (Press release, OncoNano Medicine, APR 27, 2023, View Source [SID1234630615]).

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Presentation Overview:

TITLE: Detection of peritoneal metastases during cytoreductive surgery using pegsitacianine, a pH sensitive imaging agent: Final results from a phase 2 study
PRESENTER: Patrick Wagner, MD, Director of Complex General Surgical Oncology, Allegheny Health Network Cancer Institute
DATE: June 5, 2023
SESSION TIME: 8:00 – 11:00 am CT
SESSION: Developmental Therapeutics—Molecularly Targeted Agents and Tumor Biology
ABSTRACT: 3003

Merck Announces First-Quarter 2023 Financial Results

On April 27, 2023 Merck (NYSE: MRK), known as MSD outside the United States and Canada, reported financial results for the first quarter of 2023 (Press release, Merck & Co, APR 27, 2023, View Source [SID1234630613]).

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"Inspired by our commitment to bring bold science forward to address critical unmet patient needs, we began 2023 with significant advancements across our innovative pipeline," said Robert M. Davis, chairman and chief executive officer, Merck. "Our first-quarter results are a reflection of the focused execution of our science-led strategy, strong performance across our key growth drivers, continued momentum commercially and operationally, and – most importantly – the collective and dedicated efforts of our colleagues around the world. I’m proud of the progress we’ve made, and we will continue to move with speed and agility to deliver value for patients and shareholders, now and well into the future."

Financial Summary

$ in millions, except EPS amounts

First Quarter

2023

2022

Change

Change Ex-
Exchange

Sales

$14,487

$15,901

-9%

-5%

GAAP net income1

2,821

4,310

-35%

-29%

Non-GAAP net income that excludes certain items1,2*

3,564

5,429

-34%

-30%

GAAP EPS

1.11

1.70

-35%

-30%

Non-GAAP EPS that excludes certain items2*

1.40

2.14

-35%

-30%

*Refer to table on page 10.

Generally Accepted Accounting Principles (GAAP) earnings per share (EPS) assuming dilution was $1.11 for the first quarter of 2023. Non-GAAP EPS was $1.40 for the first quarter of 2023. The declines in GAAP and non-GAAP EPS in the first quarter versus the prior year were primarily due to $0.52 of charges related to the acquisition of Imago BioSciences, Inc. (Imago) and the collaboration and licensing agreement with Kelun-Biotech (a holding subsidiary of Sichuan Kelun Pharmaceutical Co., Ltd). The declines in GAAP and non-GAAP EPS were also due to lower sales of COVID-19 medicine LAGEVRIO (molnupiravir) and the unfavorable impact of foreign exchange. Additionally, the GAAP EPS decline reflects a charge related to settlements with certain plaintiffs in the Zetia antitrust litigation. The GAAP EPS decline was partially offset by the favorable impact of net gains from investments in equity securities compared with net losses in the prior year.

Non-GAAP EPS excludes acquisition- and divestiture-related costs and costs related to restructuring programs, as well as income and losses from investments in equity securities and a charge related to settlements with certain plaintiffs in the Zetia antitrust litigation.

Proposed Acquisition of Prometheus Biosciences Strengthens Immunology Pipeline

On April 16, 2023, Merck announced a definitive agreement to acquire Prometheus Biosciences, Inc. (Prometheus) through a subsidiary for $200 per share in cash for a total equity value of approximately $10.8 billion. The agreement accelerates Merck’s growing presence in immunology and adds diversity to Merck’s overall portfolio with PRA023, a novel, late-stage candidate for ulcerative colitis, Crohn’s disease and other autoimmune conditions, as well as Prometheus’ comprehensive data set that enables its target discovery and precision medicine approach in inflammation and immunology. The transaction is expected to close in the third quarter of 2023, subject to Prometheus shareholder approval and certain conditions.
Cardiovascular Program Highlights

The following data were presented at the American College of Cardiology’s 72nd Annual Scientific Session together with World Heart Federation’s World Congress of Cardiology:

Results from the Phase 3 STELLAR trial, which evaluated sotatercept, Merck’s novel investigational activin signaling inhibitor, in combination with stable background therapy for the treatment of adult patients with pulmonary arterial hypertension (PAH) (World Health Organization Group 1). These landmark data included a significant improvement in exercise capacity for patients receiving sotatercept compared to placebo, increasing 6-minute walk distance (6MWD) by 40.8 meters from baseline at week 24, the study’s primary endpoint. In addition, sotatercept demonstrated statistically significant improvements in eight of nine secondary measures, including reduction in risk of clinical worsening or death. These data were simultaneously published in The New England Journal of Medicine (NEJM).

Results from the Phase 2b clinical trial evaluating MK-0616, an investigational once-daily oral proprotein convertase subtilisin/kexin type 9 (PCSK9) inhibitor in adults with hypercholesterolemia. MK-0616 significantly reduced low-density lipoprotein cholesterol (LDL-C) across all dose levels compared to placebo and was generally well tolerated. These data were simultaneously published in the Journal of The American College of Cardiology.
Oncology Program Highlights

Merck announced the following regulatory and clinical milestones for KEYTRUDA (pembrolizumab):

Positive topline results from the Phase 3 KEYNOTE-671 trial investigating KEYTRUDA as a perioperative treatment regimen for patients with resectable stage II, IIIA or IIIB non-small cell lung cancer (NSCLC). The U.S. Food and Drug Administration (FDA) accepted Merck’s supplemental Biologics License Application (sBLA) based on these data and has set a Prescription Drug User Fee Act (PDUFA), or target action, date of Oct. 16, 2023.

In collaboration with Moderna, Inc., first presentation of detailed results from the Phase 2b KEYNOTE-942/mRNA-4157-P201 trial at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting. Data showed that KEYTRUDA in combination with mRNA-4157/V940, an investigational individualized neoantigen therapy, demonstrated a statistically significant and clinically meaningful improvement in the primary endpoint of recurrence-free survival versus KEYTRUDA alone for the adjuvant treatment of patients with stage III/IV melanoma following complete resection.

In addition, the combination of KEYTRUDA and mRNA-4157/V940 received Breakthrough Therapy Designation by the FDA and was granted Priority Medicines (PRIME) scheme designation by the European Medicines Agency.
Accelerated approval of KEYTRUDA by the FDA in combination with Padcev3 (enfortumab vedotin-ejfv) for the treatment of adult patients with locally advanced or metastatic urothelial carcinoma who are not eligible for cisplatin-containing chemotherapy, based on data from the KEYNOTE-869 trial.

Results from the Phase 3 NRG‑GY018 trial investigating KEYTRUDA in combination with chemotherapy, then continued as a single agent, for the first-line treatment of patients with stage III-IV or recurrent endometrial carcinoma, presented at the 2023 Society of Gynecologic Oncology Annual Meeting on Women’s Cancer, with simultaneous publication in NEJM. Results showed KEYTRUDA plus chemotherapy significantly improved progression-free survival compared to chemotherapy alone in these patients, regardless of tumor DNA mismatch repair status.

Results from the pivotal Phase 3 KEYNOTE-859 trial, investigating KEYTRUDA in combination with chemotherapy for the first-line treatment of patients with human epidermal growth factor receptor 2 (HER2)-negative locally advanced unresectable or metastatic gastric or gastroesophageal junction adenocarcinoma, presented at a European Society for Medical Oncology Virtual Plenary. Study showed KEYTRUDA in combination with chemotherapy significantly improved overall survival (OS) versus chemotherapy alone in these patients, regardless of PD-L1 expression.

In addition, the FDA accepted Merck’s sBLA based on these data and has set a PDUFA date of Dec. 16, 2023.
Positive topline results from the Phase 2/3 Canadian Cancer Trials Group IND.227/KEYNOTE-483 trial evaluating KEYTRUDA in combination with chemotherapy for the first-line treatment of patients with unresectable advanced or metastatic malignant pleural mesothelioma.

Merck announced that the FDA will convene a meeting of the Oncologic Drugs Advisory Committee on April 28, 2023, to discuss the supplemental New Drug Application (sNDA) for use of Lynparza (olaparib) in combination with abiraterone and prednisone or prednisolone (abi/pred), for the treatment of adult patients with metastatic castration-resistant prostate cancer. The sNDA is based on the results of the Phase 3 PROpel trial, including the primary endpoint of radiographic progression-free survival. Merck also announced results from the final analysis of the key secondary endpoint of OS from PROpel.

Merck will host an Oncology Investor Event to coincide with the American Society for Clinical Oncology Annual Meeting on Monday, June 5, 2023, 6:00 p.m. CT, at which senior management will provide an update on the company’s oncology strategy and program. The event will take place in Chicago, Ill., and will be accessible via webcast. Further details, including the webcast link, will be announced at a later date.
Infectious Diseases Program Highlights

Merck opened enrollment in new Phase 3 clinical trials evaluating the investigational once-daily combination of doravirine, 100 mg, and islatravir, 0.25 mg (DOR/ISL) for the treatment of people with HIV-1 infection, as part of the company’s ongoing commitment to HIV.
Merck and Gilead Sciences have resumed under an amended protocol a Phase 2 clinical study evaluating an investigational once-weekly oral combination treatment regimen of islatravir and lenacapavir, for people living with HIV who are virologically suppressed on antiretroviral therapy.
Environmental, Social and Governance (ESG) Updates

Merck was named one of Barron’s Top 100 Most Sustainable U.S. Companies for the third consecutive year, ranking No. 1 in the pharmaceutical industry and No. 29 overall.
First-Quarter Revenue Performance

The following table reflects sales of the company’s top Pharmaceutical products, as well as sales of Animal Health products.

First Quarter

$ in millions

2023

2022

Change

Change Ex-
Exchange

Total Sales

$14,487

$15,901

-9%

-5%

Pharmaceutical

12,721

14,107

-10%

-6%

KEYTRUDA

5,795

4,809

20%

24%

GARDASIL / GARDASIL 9

1,972

1,460

35%

43%

JANUVIA / JANUMET

880

1,233

-29%

-25%

PROQUAD, M-M-R II and VARIVAX

528

470

12%

14%

BRIDION

487

395

23%

27%

LAGEVRIO

392

3,247

-88%

-87%

ROTATEQ

297

216

38%

42%

Lynparza*

275

266

3%

8%

Lenvima*

232

227

2%

5%

SIMPONI

180

186

-3%

2%

Animal Health

1,491

1,482

1%

5%

Livestock

849

832

2%

8%

Companion Animals

642

650

-1%

2%

Other Revenues**

275

312

-12%

-22%

*Alliance revenue for this product represents Merck’s share of profits, which are product sales net of cost of sales and commercialization costs.

**Other revenues are comprised primarily of revenues from third-party manufacturing arrangements and miscellaneous corporate revenues, including revenue-hedging activities.

Pharmaceutical Revenue

First-quarter Pharmaceutical sales declined 10% to $12.7 billion, primarily due to lower sales in virology, largely attributable to LAGEVRIO, and diabetes, partially offset by growth in oncology, vaccines and hospital acute care. Excluding LAGEVRIO, Pharmaceutical sales grew 14%, and excluding LAGEVRIO and the unfavorable impact of foreign exchange, Pharmaceutical sales grew 18%.

The decline in virology was primarily due to lower sales of LAGEVRIO, which decreased 88% to $392 million, largely attributable to sales in the U.S. and U.K. markets in the first quarter of 2022 that did not recur in the first quarter of 2023. The LAGEVRIO sales decline was also attributable to lower sales in Japan and Australia.

The sales decline within diabetes primarily reflects lower combined sales of JANUVIA (sitagliptin) and JANUMET (sitagliptin and metformin HCI), which declined 29% to $880 million, primarily due to generic competition in several international markets, particularly in Europe, and lower demand and pricing in the U.S.

Growth in oncology was largely driven by higher sales of KEYTRUDA, which rose 20% to $5.8 billion in the quarter. Global sales growth of KEYTRUDA reflects continued strong momentum from metastatic indications, including certain types of NSCLC, renal cell carcinoma, head and neck squamous cell carcinoma, triple-negative breast cancer (TNBC) and microsatellite instability-high (MSI-H) cancers, and increased uptake across recent earlier-stage launches, including certain types of neoadjuvant/adjuvant TNBC in the U.S.

Growth in vaccines reflects higher combined sales of GARDASIL (Human Papillomavirus Quadrivalent [Types 6, 11, 16 and 18] Vaccine, Recombinant) and GARDASIL 9 (Human Papillomavirus 9-valent Vaccine, Recombinant), which grew 35% to $2.0 billion, reflecting strong demand outside of the U.S., particularly in China, which also benefited from the timing of shipments and increased supply. Growth in vaccines also reflects higher sales of VAXNEUVANCE (Pneumococcal 15-valent Conjugate Vaccine), which increased to $106 million, primarily due to continued uptake in the pediatric indication following launch in the U.S. In addition, vaccines sales performance reflects higher sales of ROTATEQ (Rotavirus Vaccine, Live Oral, Pentavalent), which grew 38% to $297 million, primarily due to inventory stocking in China. Growth in vaccines was partially offset by lower sales of PNEUMOVAX 23 (pneumococcal vaccine polyvalent), which declined 44% to $96 million, primarily reflecting lower U.S. demand as the market continues to shift toward newer adult pneumococcal conjugate vaccines.

Growth in hospital acute care reflects higher sales of BRIDION (sugammadex) injection 100 mg/ML, which grew 23% to $487 million, primarily due to increased demand, particularly in the U.S., reflecting an increase in its share among neuromuscular blockade reversal agents.

Animal Health Revenue

Animal Health sales totaled $1.5 billion for the first quarter of 2023, a 1% increase compared with the first quarter of 2022. Excluding the impact of foreign exchange, Animal Health sales increased 5%. Growth in livestock products reflects strong demand notably in the ruminant and poultry product portfolio, which includes technology solution products, as well as higher pricing. Excluding the unfavorable impact of foreign exchange, growth in companion animal products reflects the impact of higher pricing. The BRAVECTO (fluralaner) parasiticide line of products had sales of $314 million in the quarter.

First-Quarter Expense, EPS and Related Information

The tables below present selected expense information.

$ in millions

GAAP

Acquisition- and Divestiture-Related Costs4

Restructuring Costs

(Income) Loss From Investments in Equity Securities

Certain Other Items

Non-GAAP2

First Quarter 2023

Cost of sales

$3,926

$545

$29

$-

$-

$3,352

Selling, general and administrative

2,479

20

1

2,458

Research and development

4,276

10

4,266

Restructuring costs

67

67

Other (income) expense, net

89

15

(429)

573

(70)

First Quarter 2022

Cost of sales

$5,380

$680

$46

$-

$-

$4,654

Selling, general and administrative

2,323

50

21

2,252

Research and development

2,576

22

7

2,547

Restructuring costs

53

53

Other (income) expense, net

708

(115)

684

139

GAAP Expense, EPS and Related Information

Gross margin was 72.9% for the first quarter of 2023 compared with 66.2% for the first quarter of 2022. The increase primarily reflects lower LAGEVRIO sales, which have a low gross margin, as well as the favorable impacts of product mix and lower amortization of intangible assets.

Selling, general and administrative (SG&A) expenses were $2.5 billion in the first quarter of 2023, an increase of 7% compared with the first quarter of 2022. The increase primarily reflects higher administrative costs and higher promotional spending, partially offset by the favorable impact of foreign exchange.

R&D expenses were $4.3 billion in the first quarter of 2023, an increase of 66% compared with the first quarter of 2022. The increase was primarily driven by a $1.2 billion charge for the acquisition of Imago and a $175 million charge related to a collaboration and licensing agreement with Kelun-Biotech. In addition, the increase was driven by higher compensation and benefit costs, reflecting in part increased headcount to support expanded clinical development activity, higher investments in discovery research and early drug development, and higher clinical development spending.

Other (income) expense, net, was $89 million of expense in the first quarter of 2023 compared with $708 million of expense in the first quarter of 2022. The change is primarily due to net gains from investments in equity securities in the first quarter of 2023 compared with net losses from investments in equity securities in the first quarter of 2022, as well as higher interest income in the first quarter of 2023. The favorability was partially offset by a $573 million charge in the first quarter of 2023 related to settlements with certain plaintiffs in the Zetia antitrust litigation.

The effective tax rate of 22.6% for the first quarter of 2023 reflects the unfavorable discrete impact of a charge for the acquisition of Imago for which no tax benefit was recognized, as well as the unfavorable effects of higher foreign taxes, the R&D capitalization provision of the Tax Cuts and Jobs Act of 2017, and net unrealized gains from investments in equity securities, which were taxed at the U.S. tax rate.

GAAP EPS was $1.11 for the first quarter of 2023 compared with $1.70 for the first quarter of 2022.

Non-GAAP Expense, EPS and Related Information

Non-GAAP gross margin was 76.9% for the first quarter of 2023 compared with 70.7% for the first quarter of 2022. The increase primarily reflects lower LAGEVRIO sales, which have a low gross margin, as well as the favorable impact of product mix.

Non-GAAP SG&A expenses were $2.5 billion in the first quarter of 2023, an increase of 9% compared with the first quarter of 2022. The increase primarily reflects higher administrative costs and higher promotional spending, partially offset by the favorable impact of foreign exchange.

Non-GAAP R&D expenses were $4.3 billion in the first quarter of 2023, an increase of 67% compared with the first quarter of 2022. The increase was primarily driven by a $1.2 billion charge for the acquisition of Imago and a $175 million charge related to a collaboration and licensing agreement with Kelun-Biotech. In addition, the increase was driven by higher compensation and benefit costs, reflecting in part increased headcount to support expanded clinical development activity, higher investments in discovery research and early drug development, and higher clinical development spending.

Non-GAAP other (income) expense, net, was $70 million of income in the first quarter of 2023 compared with $139 million of expense in the first quarter of 2022, primarily reflecting higher interest income in the first quarter of 2023.

The non-GAAP effective tax rate of 20.4% for the first quarter of 2023 reflects the unfavorable discrete impact of a charge for the acquisition of Imago for which no tax benefit was recognized, as well as the unfavorable effects of higher foreign taxes and the R&D capitalization provision of the Tax Cuts and Jobs Act of 2017.

Non-GAAP EPS was $1.40 for the first quarter of 2023 compared with $2.14 for the first quarter of 2022.

A reconciliation of GAAP to non-GAAP net income and EPS is provided in the table that follows.

First Quarter

$ in millions, except EPS amounts

2023

2022

EPS

GAAP EPS

$1.11

$1.70

Difference

0.29

0.44

Non-GAAP EPS that excludes items listed below2

$1.40

$2.14

Net Income

GAAP net income1

$2,821

$4,310

Difference

743

1,119

Non-GAAP net income that excludes items listed below1,2

$3,564

$5,429

Decrease (Increase) in Net Income Due to Excluded Items:

Acquisition- and divestiture-related costs4

$590

$637

Restructuring costs

97

127

(Income) loss from investments in equity securities

(429)

684

Charge for Zetia antitrust litigation settlements

573

Net decrease (increase) in income before taxes

831

1,448

Estimated income tax (benefit) expense

(88)

(329)

Decrease (increase) in net income

$743

$1,119

Financial Outlook

The following table summarizes the company’s full-year 2023 financial outlook.

GAAP

Non-GAAP2

Sales*

$57.7 to $58.9 billion

$57.7 to $58.9 billion

Gross margin

Approximately 73%

Approximately 77%

Operating expenses**

$23.5 to $24.3 billion

$23.3 to $24.1 billion

Effective tax rate

17% to 18%

17% to 18%

EPS***

$5.85 to $5.97

$6.88 to $7.00

*Includes approximately $1.0 billion of LAGEVRIO sales. The company does not have any non-GAAP adjustments to sales.

**Includes an aggregate $1.4 billion of R&D expenses related to the Imago acquisition and upfront payment for the license and collaboration agreement with Kelun-Biotech. Outlook does not assume the proposed acquisition of Prometheus or any additional significant potential business development transactions.

***Includes $0.52 of charges related to the Imago acquisition and upfront payment to Kelun-Biotech.

Assumes a share count (assuming dilution) of approximately 2.55 billion shares.

Merck continues to experience strong global underlying demand across its key pillars of growth. Consequently, Merck is raising and narrowing its full-year outlook ranges for sales and non-GAAP EPS. For GAAP EPS, Merck is lowering and narrowing its full-year outlook, attributable to a GAAP-only charge related to settlements with certain plaintiffs in the Zetia antitrust litigation.

Merck now expects full-year 2023 sales to be between $57.7 billion and $58.9 billion, including a negative impact of foreign exchange of approximately 2 percentage points, at mid-April 2023 exchange rates. This full-year outlook includes expected sales of LAGEVRIO of approximately $1.0 billion.

Merck’s full-year effective income tax rate is expected to be between 17% and 18%.

Merck is lowering and narrowing its full-year 2023 GAAP EPS range to be between $5.85 and $5.97.

Merck is raising and narrowing its full-year 2023 non-GAAP EPS range to be between $6.88 and $7.00, including a negative impact of foreign exchange of approximately 4 percentage points, at mid-April 2023 exchange rates. The non-GAAP range excludes acquisition- and divestiture-related costs and costs related to restructuring programs, as well as income and losses from investments in equity securities and a charge related to settlements with certain plaintiffs in the Zetia antitrust litigation.

A reconciliation of anticipated 2023 GAAP EPS to non-GAAP EPS and the items excluded from non-GAAP EPS are provided in the table below.

$ in millions, except EPS amounts

Full Year 2023

GAAP EPS

$5.85 to $5.97

Difference

$1.03

Non-GAAP EPS that excludes items listed below2

$6.88 to $7.00

Acquisition- and divestiture-related costs

$2,500

Restructuring costs

400

(Income) loss from investments in equity securities

(375)

Charge for Zetia antitrust litigation settlements

573

Net decrease (increase) in income before taxes

$3,098

Estimated income tax (benefit) expense

(470)

Decrease (increase) in net income

$2,628

In April, Merck announced it has agreed to acquire Prometheus; the acquisition is expected to close in the third quarter of 2023. Merck’s outlook does not reflect this transaction, which is expected to be accounted for as an asset acquisition, and would result in a one-time charge of approximately $10.3 billion recorded to both GAAP and non-GAAP R&D expenses in 2023, or approximately $4.00 per share. In addition, taking into consideration operational investment to advance the pipeline assets as well as the cost of financing, Merck also anticipates EPS will be negatively impacted by approximately $0.25 in the first 12 months following close. Once the transaction closes, Merck will incorporate the anticipated impacts of this acquisition in both its GAAP and non-GAAP financial outlook.

Earnings Conference Call

Investors, journalists and the general public may access a live audio webcast of the earnings conference call on Thursday, April 27, at 9:00 a.m. ET via this weblink. A replay of the webcast, along with the sales and earnings news release, supplemental financial disclosures, and slides highlighting the results, will be available at www.merck.com.

All participants may join the call by dialing (888) 769-8514 (U.S. and Canada Toll-Free) or (517) 308-9208 and using the access code 8206435.

LamKap Bio presented data on NILK-2301, NILK-2401 & NILK-3301

On April 27, 2023 LamKap Bio reported that it has presented data on NILK-2301, NILK-2401 & NILK-3301 (Press release, LamKap Bio Group, APR 27, 2023, View Source [SID1234630610]).

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The American Association for Cancer Research (AACR) (Free AACR Whitepaper) hosted the AACR (Free AACR Whitepaper) annual meeting 2023 April 14-19, 2023. LamKap Bio is very pleased to have presented preclinical data on the combination of NILK-2301 (CEACAM5xCD3) and NILK-2401 (CEACAM5xCD47) as well as NILK-2301 and NILK-3301 (CEACAM5xCD28) bispecific antibodies for immunotherapy of patients with carcinoembryonic antigen-related cell adhesion molecule 5 (CEACAM5 aka CEA) expressing solid tumors.

"Combination of κλ bispecific antibodies targeting innate (CEAxCD47, NILK-2401) and adaptive immunity (CEAxCD3, NILK-2301 and CEAxCD28, NILK-3301) for next generation immunotherapy of CEA-expressing cancers" (abstract no. 5100) was presented on site in poster section 22 (board no. 3) on April 18, 1:30 PM – 5:00 PM.

GILEAD SCIENCES ANNOUNCES FIRST QUARTER 2023 FINANCIAL RESULTS

On April 27, 2023 Gilead Sciences, Inc. (Nasdaq: GILD) reported its results of operations for the first quarter of 2023 (Press release, Gilead Sciences, APR 27, 2023, View Source [SID1234630607]).

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"Gilead’s track record of strong commercial and clinical execution continued through the first quarter of 2023. A 15% year-over-year revenue increase reflects growth in each of our core areas," said Daniel O’Day, Gilead’s Chairman and Chief Executive Officer. "Biktarvy outperformed once again, and Oncology revenue increased 59% year-over-year, driven by Trodelvy and Cell Therapy. We look forward to helping even more people with Trodelvy following the approval for pre-treated HR+/HER2- metastatic breast cancer, making this the third U.S. approval for Trodelvy in three years."

First Quarter 2023 Financial Results

•Total first quarter 2023 revenue decreased 4% to $6.4 billion compared to the same period in 2022, due to lower Veklury (remdesivir) sales, partially offset by increased sales in HIV and Oncology.
•Diluted Earnings Per Share ("EPS") increased to $0.80 for the first quarter of 2023 compared to $0.02 for the same period in 2022, mainly driven by the following items net of their related tax effect: a $2.7 billion in-process research and development ("IPR&D") impairment recorded in the first quarter of 2022, which did not repeat in 2023, partially offset by higher operating expenses, including higher acquired IPR&D expense and lower revenues in 2023.
•Non-GAAP diluted EPS decreased to $1.37 for the first quarter of 2023 compared to $2.12 for the same period in 2022, primarily driven by the following items net of their related tax effect: higher operating expenses, including higher acquired IPR&D expense, and lower revenues in 2023.
•As of March 31, 2023, Gilead had $7.2 billion of cash, cash equivalents and marketable debt securities, down from $7.6 billion as of December 31, 2022.
•During the first quarter of 2023, Gilead generated $1.7 billion in operating cash flow.
•During the first quarter of 2023, Gilead paid dividends of $969 million and repurchased $400 million of common stock.
Product Sales Performance
Total first quarter 2023 product sales decreased 3% to $6.3 billion compared to the same period in 2022. Total product sales, excluding Veklury, increased 15% to $5.7 billion in the first quarter of 2023 compared to the same period in 2022, primarily due to increased sales related to HIV, Cell Therapy, Trodelvy (sacituzumab govitecan-hziy) and Liver Disease.

HIV product sales increased 13% to $4.2 billion in the first quarter of 2023 compared to the same period in 2022, primarily driven by favorable pricing dynamics, as well as higher demand and lower inventory draw-downs.
•Biktarvy (bictegravir 50mg/emtricitabine 200mg ("FTC")/tenofovir alafenamide 25mg ("TAF")) sales increased 24% year-over-year in the first quarter of 2023, reflecting higher demand, as well as favorable pricing and inventory dynamics.
•Descovy (FTC 200mg/TAF 25mg) sales increased 20% year-over-year in the first quarter of 2023, primarily driven by higher demand and favorable pricing dynamics.
The Liver Disease portfolio sales, which includes chronic hepatitis C virus ("HCV"), chronic hepatitis B virus ("HBV") and chronic hepatitis delta virus ("HDV"), increased 6% to $675 million in the first quarter of 2023 compared to the same period in 2022, primarily driven by higher demand and timing of purchases in the U.S.
Cell Therapy product sales increased 64% to $448 million in the first quarter of 2023 compared to the same period in 2022.
•Yescarta (axicabtagene ciloleucel) sales increased 70% to $359 million in the first quarter of 2023, primarily driven by increased demand in relapsed or refractory ("R/R") large B-cell lymphoma ("LBCL").
•Tecartus (brexucabtagene autoleucel) sales increased 40% to $89 million in the first quarter of 2023, primarily driven by increased demand in R/R mantle cell lymphoma and R/R adult acute lymphoblastic leukemia ("ALL").
Trodelvy sales increased by 52% to $222 million in the first quarter of 2023 compared to the same period in 2022, primarily driven by increased adoption in metastatic triple-negative breast cancer in the United States and Europe, as well as the launch of the indication for pretreated HR+/HER2- metastatic breast cancer in the United States.
Veklury sales decreased by 63% to $573 million for the first quarter of 2023 compared to the same period in 2022, primarily driven by lower rates of COVID-19 related hospitalizations in all regions. Veklury sales generally reflect COVID-19 related rates and severity of infections and hospitalizations, as well as the availability, uptake and effectiveness of vaccinations and alternative treatments for COVID-19.
First Quarter 2023 Product Gross Margin, Operating Expenses and Effective Tax Rate
•Product gross margin was 77.8% for the first quarter of 2023 compared to 78.2% for the same period in 2022. Non-GAAP product gross margin was 86.2% for the first quarter of 2023 compared to 87.4% in the same period in 2022.
•Research and development ("R&D") expenses and non-GAAP R&D expenses for the first quarter of 2023 were $1.4 billion, compared to $1.2 billion in the same period in 2022. The increases in GAAP and non-GAAP R&D expenses were primarily driven by increased clinical activities.
•Acquired IPR&D expenses for the first quarter of 2023 were $481 million compared to $8 million in the same period in 2022, primarily driven by the acquisition of Tmunity Therapeutics Inc. ("Tmunity"), as well as upfront and milestone payments related to the collaborations with Arcellx, Inc. ("Arcellx") and Nurix Therapeutics, Inc. ("Nurix").
•Selling, general and administrative ("SG&A") expenses and non-GAAP SG&A expenses for the first quarter of 2023 were $1.3 billion, compared to $1.1 billion in the same period in 2022. The increases in GAAP and non-GAAP SG&A expenses were primarily due to Oncology commercial expansion and investments, higher Branded Prescription Drug fee, as well as higher corporate activities.
•The effective tax rate ("ETR") for the first quarter of 2023 was 24.3% compared to 107.9% for the same period in 2022. The decrease in ETR was primarily due to a $2.7 billion IPR&D impairment taken in the first quarter of 2022 related to assets acquired by Gilead from Immunomedics Inc. that did not repeat in 2023. Non-GAAP ETR for the first quarter of 2023 was 18.9% compared to 18.4% for the same period in 2022.

Guidance and Outlook

For the full-year, Gilead expects:

•Total product sales between $26.0 billion and $26.5 billion, unchanged from prior guidance.
•Total product sales, excluding Veklury, between $24.0 billion and $24.5 billion, unchanged from prior guidance.
•Total Veklury sales of approximately $2.0 billion, unchanged from prior guidance. Veklury sales are expected to be highly variable, depending on the frequency and severity of surges, and our guidance will continue to be updated on a quarterly basis as necessary.
•Diluted earnings per share between $4.75 and $5.15, compared to $5.30 and $5.70 previously.
•Non-GAAP diluted earnings per share between $6.60 and $7.00, unchanged from prior guidance.
Additional information and a reconciliation between GAAP and non-GAAP financial information for the 2023 guidance is provided in the accompanying tables. Also see the Forward-Looking Statements described below. The financial guidance is subject to a number of risks and uncertainties, including uncertainty around the duration and magnitude of the COVID-19 pandemic.
Key Updates Since Our Last Quarterly Release
Virology
•Presented positive Phase 1b proof-of-concept data for an investigational combination regimen of lenacapavir with broadly neutralizing antibodies teropavimab and zinlirvimab as a potential long-acting treatment regimen for HIV with twice-yearly dosing at the Conference on Retroviruses and Opportunistic Infections ("CROI") 2023. In addition, announced results from multiple collaborative studies evaluating novel investigational combinations and strategies as part of the HIV cure research program.
•Announced new real-world study data at CROI demonstrating Veklury use in hospitalized patients with COVID-19 was associated with a statistically significant reduction in mortality in the overall patient population, including immunocompromised patients. Real-world data analyses of Veklury from other sources are ongoing and may vary in their results or conclusions. Separate in vitro analyses were also presented that showed Veklury retains potent antiviral activity against recent Omicron subvariants.
•Presented new COVID-19 data at the European Congress of Clinical Microbiology and Infectious Diseases, including results from a Phase 1 study of obeldesivir (GS-5245), as an investigational oral therapy for the treatment of COVID-19. Additionally, presented findings from a Phase 3 study of Veklury in patients with severe renal impairment, as well as new real-world studies.
Oncology
•Received FDA approval of Trodelvy for the treatment of adult patients with unresectable locally advanced or metastatic HR+/HER2- breast cancer who have received endocrine-based therapy and at least two additional systemic therapies in the metastatic setting.
•Presented positive results from a three-year follow-up analysis of Tecartus in the Phase 2 ZUMA-3 study of patients with R/R ALL at the European CAR T-cell Meeting.
•Presented positive data from the Phase 2 TROPHY-U-01 study of Trodelvy for the treatment of metastatic urothelial cancer at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Genitourinary Cancers Symposium.
•Completed the acquisition of Tmunity, a clinical stage private biotech company, which provides preclinical and clinical programs, including an investigational "armored" CAR T technology platform that has the potential to be applied to a variety of CAR Ts to enhance anti-tumor activity, as well as rapid manufacturing processes.
•Announced primary overall survival results from the Phase 3 ZUMA-7 study for initial treatment of adult patients with R/R LBCL, which showed a statistically significant improvement for Yescarta in overall survival versus historical treatment.

Inflammation

•Exercised option to license investigational targeted protein degrader molecule NX‑0479 ("GS-6791") from Nurix. GS-6791 is a potent, selective, oral IRAK4 degrader with potential applications in the treatment of rheumatoid arthritis and other inflammatory diseases.

Corporate

•The company’s Board of Directors declared a quarterly dividend of $0.75 per share of common stock for the second quarter of 2023. The dividend is payable on June 29, 2023, to stockholders of record at the close of business on June 15, 2023. Future dividends will be subject to Board approval.
Certain amounts and percentages in this press release may not sum or recalculate due to rounding.

Conference Call

At 1:30 p.m. Pacific Time today, Gilead will host a conference call to discuss Gilead’s results. A live webcast will be available on View Source and will be archived on www.gilead.com for one year.

Fourth quarter and full year 2022 financial results and business update

On April 27, 2023 Evaxion Biotech A/S (NASDAQ: EVAX) ("Evaxion" or the "Company"), a clinical-stage biotechnology company specializing in the development of AI-driven immunotherapies, reported the fourth quarter and full-year 2022 financial results and provided a business update (Press release, Evaxion Biotech, APR 27, 2023, View Source [SID1234630606]).

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"Evaxion made excellent progress across its core AI technologies for vaccine target discovery in 2022 and early 2023, validated through the progress in the pipeline," said Per Norlén, Chief Executive Officer of Evaxion. "Looking back on our accomplishments, I’d like to highlight the initial proof-of-concept clinical trials in melanoma for EVX-01 and EVX-02, developed using our PIONEER artificial intelligence (AI)-platform, and our next-generation immuno-oncology candidate, EVX-03, scheduled to begin clinical testing in Q4 2023. We also announced another proprietary AI technology, ObsERV, targeting endogenous retroviruses (ERVs), which is planned to be incorporated into our personalized cancer vaccines. Over the last six months, as we have refined our development strategy and business focus, re-aligned our organization and extended our cash runway, I am grateful to the outstanding work of the team and remain impressed by the strength of Evaxion’s core AI-science."

Per concluded, "We recently reported promising clinical results from the Phase 1/2a EVX-02 study in melanoma at the 2023 annual meeting for the American Association for Clinical Research (AACR) (Free AACR Whitepaper). Looking ahead to the rest of the year, we plan to report final Phase 1/2a results and interim Phase 2 data from the EVX-01 program in melanoma. In addition, we intend to initiate recruitment in a Phase 1 study with EVX-03 in Q4 2023. We look forward to inform the investment community and our key stakeholders with further updates on our progress throughout the year."

Pipeline Updates

Technology advances:
Novel ObsERV technology — In March 2023, Evaxion reported the discovery of a novel new source of antigens for personalized cancer immunotherapy, based on endogenous retroviruses (ERVs). The AI-enabled technology has the potential to make "cold" tumors responsive to immunotherapy, which has the potential to broaden the patient population for immunotherapy significantly.

Novel mRNA vaccine delivery collaboration with Pantherna — In February 2023, Evaxion and Pantherna announced promising mRNA vaccine data. The preclinical data demonstrated that tumor neoantigens identified by Evaxion’s AI PIONEER platform could drive a strong immune response and lead to complete inhibition of tumor growth when delivered using Pantherna’s proprietary mRNA platform.

Program Overview
EVX-01 (1st generation, Peptide based vaccine, Phase 2 in melanoma) – The ongoing single-arm, multi-center trial (NCT05309421) is evaluating EVX-01 for the treatment of adults with metastatic melanoma in combination with the [PD-1 inhibitor/checkpoint inhibitor/CPI], KEYTRUDA.

The Company plans to present a full read-out of the previous Phase 1/2a study in 12 patients at the American Society for Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting in June 2023, in which interim data demonstrated clinical response in six out of the first nine patients.
The Phase 2 study, initiated in September 2022, is expected to enroll up to 20 patients and report interim data in Q4 2023.
EVX-02 (2nd generation, DNA-based vaccine, Phase 1/2a in melanoma) – The single-arm, open-label study (NCT04455503) evaluated EVX-02 in combination with the CPI, nivolumab, in patients with advanced melanoma who had undergone complete surgical resection and were at high risk for recurrence.

Data presented at the 2023 AACR (Free AACR Whitepaper) meeting showed that all 10 patients who completed the full course of dosing with the EVX-02/CPI combination were relapse-free during the 12-month study period. The treatment also produced neoantigen-specific long-lasting T-cell immune responses involving both CD4+ and CD8+ T-cells. The EVX-02/CPI treatment combination was well tolerated, and only mild EVX-02-associated adverse events (AEs) were observed.
EVX-03 (3rd generation, DNA-based vaccine, Phase 1 study expected to begin in Q4 2023) – EVX-03 is a DNA-based personalized cancer immunotherapy that combines patient-specific neoantigens with personalized ERVs. Bringing these personalized antigens together into a single plasmid construct, armed with a genetic immune adjuvant, will enable Evaxion to develop an immunotherapy with the potential for inducing a robust and patient-specific immune response and for increased efficacy.

A clinical trial authorization (CTA) filing with the European Medicines Agency to evaluate the combination of EVX-03 and a CPI is anticipated to be filed in Q3 2023 and the Phase 1 study is anticipated to begin in Q4 2023 in patients with solid tumors.
Infectious diseases programs: based on Evaxion’s EDEN and RAVEN technologies

Technology advances:
EVX-B1 (S. aureus, preclinical) – Evaxion has demonstrated significant protection from S. aureus infection in both sepsis and skin infection models. The next step for this partnering-ready program is IND-enabling toxicology studies.

EVX-B2 (N. gonorrhoeae, preclinical) – In June 2022, Evaxion announced gonorrhea as a new bacterial vaccine candidate for N. gonorrhoeae. In September 2022, Evaxion announced that the Company, in collaboration with the UMass Chan Medical School, had received a grant from the U.S. National Institutes of Health (NIH) for the development of a lead vaccine candidate.

EVX-V1 (Cytomegavirus/CMV, preclinical) – In December 2022, Evaxion and ExpreS²ion initiated the discovery phase of a joint research collaboration to develop a next generation CMV vaccine candidate that elicits both cellular and humoral antibody responses; this phase will be jointly funded until 2025. After that, the parties could expand the research collaboration into a Development and Commercialization agreement.

Expected milestones in 2023

Q2 2023 – Full readout EVX-01 Phase 1/2a – to be presented at ASCO (Free ASCO Whitepaper) in June 2023
Q4 2023 – Report interim results from EVX-01 Phase 2 trial
Q4 2023 – Initiate patient recruitment in a Phase 1 study for EVX-03
Full Year 2022 Financial Results

Cash position: As of December 31, 2022, cash and cash equivalents were $13.2 million as compared to $32.2 million as of December 31, 2021. This along with capital raised in Q1 2023 of $4.2 million, is anticipated to be sufficient to fund operations into December 2023.
Research and Development expenses were $17.1 million for the year ended December 31, 2022 as compared to $19.6 million for the year ended December 31, 2021. The decrease was primarily related to a decrease in spending on clinical trials, net of grant income and preclinical product candidates countered by an increase in employee-related costs.
General and Administrative expenses were $8.2 million for the year ended December 31, 2022 compared to $6.3 million for the year ended December 31, 2021. The increase was primarily related to professional fees incurred by the corporate functions as a listed company.
Net loss was $23.2 million for the year ended December 31, 2022 or ($0.98) loss per basic and diluted share as compared to $24.5 million, or ($1.26) loss per basic and diluted share for the year ended December 31, 2021.
Based on the Company’s current cash position, with a cash runway until beginning of December and the need for further funding, our auditors EY have provided an emphasis of matter in their auditors report that there exists substantial doubt about the Company’s ability to continue as a going concern.

Webcast and Conference Call

Evaxion will host a webcast and conference call today, April 27, at 8:30 am EDT.

To dial in for the conference call, please use the following details:

US: 877‑407‑0792
International: +1‑201‑689‑8263
Conference ID: 13727933
Alternatively to access the audio webcast, please visit the events page of Evaxion’s website at: View Source