CTI BioPharma Reports Third Quarter 2018 Financial Results

On November 1, 2018 CTI BioPharma Corp. (NASDAQ:CTIC) reported financial results for the third quarter and nine months ended September 30, 2018 (Press release, CTI BioPharma, NOV 1, 2018, View Source;p=RssLanding&cat=news&id=2374745 [SID1234530509]).

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In October 2018, CTI BioPharma announced the continuation of the PAC203 Phase 2 study without modification, following a planned second interim review by an Independent Data Monitoring Committee (IDMC). The IDMC did not identify significant drug- or dose-related safety concerns and specifically did not identify any concerns around hemorrhagic or cardiac toxicity. A complete dataset from the full enrollment of 150 patients (including efficacy, safety, pharmacokinetic and pharmacodynamic data) will now be used to determine the optimal dose of pacritinib for further clinical development. The PAC203 study is expected to complete enrollment by the end of 2018, with the next planned interim safety review to be conducted in the first quarter of 2019. Top-line data from the study are expected in the second quarter of 2019. The Company has scheduled a Type C meeting with the U.S. Food and Drug Administration (FDA) to take place before the end of the year to discuss the design of a new registrational Phase 3 study of pacritinib in myelofibrosis patients with severe thrombocytopenia (platelet counts of less than 50,000 per microliter). Following the identification of the optimal dose from the PAC203 study, the Company expects to begin Phase 3 patient recruitment mid-year in 2019.

In the third quarter of 2018, the Company submitted comprehensive responses to the Day 180 List of Outstanding Issues from the European Medicines Agency (EMA) regarding the marketing authorization application (MAA) for pacritinib. These responses include new data from the PAC203 trial. The Company expects an opinion from the EMA Committee for Medicinal Products for Human Use (CHMP) on the MAA for pacritinib by the end of 2018.

"We continue to progress with pacritinib development and look forward to our meeting with the FDA to discuss the design of a registrational Phase 3 trial expected to address the needs of myelofibrosis patients with severe thrombocytopenia," commented Adam R. Craig, M.D., Ph.D., President and Chief Executive Officer of CTI BioPharma. "Regarding PAC203, we expect to determine the optimal dose of pacritinib in the first half of 2019 and initiate patient recruitment for the Phase 3 trial in mid-2019, adapting the PAC203 study from a Phase 2 to a Phase 3."

Third Quarter Financial Results
Total revenues for the third quarter and nine months ended September 30, 2018, were $0.7 million and $11.8 million, respectively, compared to $1.7 million and $24.7 million for the respective periods in 2017. The decrease in total revenues for the third quarter in 2018 compared to the same period in 2017 is primarily due to the recognition of license and contract revenue in 2017 related to the achievement of a regulatory milestone under the license and collaboration agreement for PIXUVRI with Servier. The decrease in total revenues for the nine months ended September 30, 2018 compared to the same period in 2017 is primarily due to license and contract revenue that included the recognition of payments received from the expansion of the license and collaboration agreement for PIXUVRI with Servier in 2017.

GAAP operating loss was $14.8 million and $33.1 million for the third quarter and nine months ended September 30, 2018, respectively, compared to GAAP operating loss of $11.8 million and $25.8 million for the respective periods in 2017. Non-GAAP operating loss, which excludes non-cash share-based compensation expense, for the third quarter and nine months ended September 30, 2018, was $12.2 million and $28.2 million, respectively, compared to non-GAAP operating loss of $10.4 million and $21.5 million for the respective periods in 2017. Non-cash share-based compensation expense for the third quarter and nine months ended September 30, 2018, was $2.5 million and $4.9 million, respectively, compared to $1.4 million and $4.3 million for the respective periods in 2017. Operating loss in the third quarter of 2018 as compared to the same period in 2017 resulted primarily from the decrease in license and contract revenue as mentioned above and a decrease in selling, general and administrative expenses. Operating loss for the nine months ended September 30, 2018, as compared to the same period in 2017 resulted primarily from the decrease in license and contract revenue as mentioned above and an increase in research and development expenses. For information on CTI BioPharma’s use of non-GAAP operating loss and a reconciliation of such measure to GAAP operating loss, see the section below titled "Non-GAAP Financial Measures."

Net loss attributable to common stockholders for the third quarter of 2018 was $14.8 million, or $(0.26) per share, compared to $12.0 million, or $(0.28) per share, for the same period in 2017. Net loss attributable to common stockholders for the nine months ended September 30, 2018, was $30.2 million, or $(0.55) per share, compared to a net loss of $30.8 million, or $(0.90) per share, for the same period in 2017.

As of September 30, 2018, cash, cash equivalents and short-term investments totaled $80.9 million, compared to $43.2 million as of December 31, 2017.

Conference Call Information
CTI BioPharma management will host a conference call to review its third quarter 2018 financial results and provide an update on business activities. The event will be held today at 1:30 p.m. PT / 4:30 p.m. ET. Participants can access the call at 877-260-1479 (domestic) or +1 334-323-0522 (international). To access the live audio webcast or the subsequent archived recording, visit www.ctibiopharma.com. Webcast and telephone replays of the conference call will be available approximately two hours after completion of the call. Callers can access the replay by dialing 1-888-203-1112 (domestic) or +1 719-457-0820 (international). The access code for the replay is 4559931. The telephone replay will be available until November 8, 2018.

Constellation Pharmaceuticals Receives FDA Fast Track Designation for CPI-0610 in Treatment of Myelofibrosis

On November 1, 2018 Constellation Pharmaceuticals, Inc., a clinical-stage biopharmaceutical company using its expertise in epigenetics to discover and develop novel therapeutics, reported that it has received Fast Track designation from the United States Food and Drug Administration (FDA) for CPI-0610 in treatment of myelofibrosis (MF) based on preliminary results from the Company’s Phase 2 study, MANIFEST (Press release, Constellation Pharmaceuticals, NOV 1, 2018, View Source [SID1234530508]).

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Constellation is developing CPI-0610 with the goal of providing a new treatment option for patients with MF who have progressed after treatment with Jakafi (ruxolitinib), the only approved therapy for MF. Enrollment is ongoing in the Phase 2 portion of the open-label Phase 1/2 MANIFEST clinical trial, which is exploring CPI-0610’s potential both as a monotherapy and as a combination therapy with Jakafi. As previously reported, preliminary data demonstrated clinical activity, such as spleen volume reduction, symptom improvement, increase in hemoglobin levels, and conversion to transfusion independent status in a patient who was transfusion dependent. Constellation recently expanded the MANIFEST study to include a third cohort, designed to evaluate CPI-0610 as a first-line therapy in combination with ruxolitinib in JAK 1/2-inhibitor-naïve MF patients.

"We believe there is an opportunity to improve the standard of care for MF patients with agents that modify the underlying disease," said Adrian Senderowicz, Senior Vice President and Chief Medical Officer of Constellation Pharmaceuticals. "This Fast Track designation highlights CPI-0610’s potential to address a significant unmet need. Based on promising early data and our progress with site initiation and patient enrollment, we continue to expect to determine proof of concept in mid-2019."

The FDA grants Fast Track designation to facilitate the development and expedite the review of drugs to treat serious or life-threatening diseases and fill unmet medical needs. A drug that receives Fast Track designation is

eligible for more frequent meetings with the FDA to discuss the drug’s development plan and ensure collection of appropriate data needed to support drug approval, more frequent written communication about the design of the proposed clinical trials and use of biomarkers, eligibility for accelerated approval and priority review, and rolling review.

About Myelofibrosis

MF is part of a collection of progressive blood cancers known as myeloproliferative neoplasms and is associated with significantly reduced quality of life and shortened survival. As the disease progresses, the bone marrow produces fewer red blood cells. Within one year of diagnosis, the incidence of thrombocytopenia (a condition characterized by low platelet counts in the blood) and severe anemia (a condition characterized by low red blood cell counts) and the need for red blood cell transfusion increase significantly. Among other complications, most patients with MF have enlarged spleens, as well as many other physical symptoms, including abdominal discomfort, bone pain, and extreme fatigue.

About CPI-0610

CPI-0610 is a potent and selective small molecule designed to promote anti-tumor activity by selectively inhibiting the function of BET proteins to decrease the expression of abnormally expressed genes in cancer. Constellation’s epigenetics platform includes a deep understanding of the biological contexts in which BET proteins operate, including cancer pathways that are highly sensitive to CPI-0610. The results from preclinical studies, as well as translational insights from the successful first-in-human study of CPI-0610, led to prioritizing the clinical development of CPI-0610 in myelofibrosis (MF). Enrollment is ongoing in the Phase 2 portion of the open-label Phase 1/2 MANIFEST clinical trial of CPI-0610, either as a monotherapy or in combination with ruxolitinib, in patients with MF who are refractory or intolerant or have relapsed or lost response to the standard of care. MANIFEST also includes a third cohort designed to evaluate treatment with CPI-0610 in combination with ruxolitinib as a first-line therapy in JAK 1/2-inhibitor-naïve MF patients. The company expects to determine proof of concept for CPI-0610 in MF in mid-2019.

Conatus Pharmaceuticals Reports Third Quarter 2018 Financial Results and Program Updates

On November 1, 2018 Conatus Pharmaceuticals Inc. (Nasdaq:CNAT), a biotechnology company focused on the development and commercialization of novel medicines to treat liver disease, reported financial results for the quarter and nine months ended September 30, 2018, and provided updates on its clinical development programs (Press release, Conatus Pharmaceuticals, NOV 1, 2018, View Source [SID1234530507]).

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Program Updates
The company is conducting three Phase 2b clinical trials in collaboration with Novartis – the EmricasaN, a Caspase inhibitOR, for Evaluation (ENCORE) trials, designed to evaluate emricasan, a first-in-class pan-caspase inhibitor, in patients with fibrosis or cirrhosis caused by nonalcoholic steatohepatitis (NASH).

The ENCORE-PH (for Portal Hypertension) clinical trial, initiated in the fourth quarter of 2016, has enrolled approximately 240 patients with compensated or early decompensated NASH cirrhosis and severe portal hypertension. The primary endpoint is the mean change in hepatic venous pressure gradient (HVPG) for each of three treatment groups compared with placebo at week 24. ENCORE-PH remains on track with prior guidance, with top-line results expected in the current quarter followed by an integrated 24-week treatment extension period for clinical outcomes.

The ENCORE-NF (for NASH Fibrosis) clinical trial, initiated in the first quarter of 2016, has enrolled approximately 330 patients with NASH fibrosis. The primary endpoint is a one point or greater improvement in NASH Clinical Research Network (CRN) fibrosis score compared with placebo at week 72, with no worsening of steatohepatitis. ENCORE-NF enrolled patients with baseline NASH CRN fibrosis scores of F1 (up to 20% of enrolled patients), F2, and F3. The primary endpoint will be evaluated and can be achieved in either of two prospectively defined patient populations – the F1/F2/F3 population or the F2/F3 population. Either of these populations may be used in a future Phase 3 trial. The company believes that the ENCORE-NF analysis plan as described has the potential to facilitate discussions with regulatory authorities regarding its use as a study to support regulatory approval. Top-line results from ENCORE-NF are expected in the first half of 2019.

The ENCORE-LF (for Liver Function) clinical trial, initiated in the second quarter of 2017, is expected to enroll approximately 210 patients with decompensated NASH cirrhosis. The primary endpoint is event-free survival, with an event-driven stopping point. All subjects will be treated for a minimum of 48 weeks. Guidance for the ENCORE-LF clinical trial has been updated, with top-line results previously expected in the second half of 2019 now expected in mid-2019.
During the third quarter, the company announced the publication of results from preclinical studies of emricasan, demonstrating improvements in portal hypertension and survival in mouse models of secondary biliary cirrhosis. In October, the company announced accepted abstracts for two oral presentations and a poster at The Liver Meeting, the annual meeting of the American Association for the Study of Liver Diseases (AASLD) in San FranciscoNovember 9-13, 2018. In addition, the company will be meeting with institutional investors at the Stifel 2018 Healthcare Conference in New York on Tuesday, November 13, 2018.

Financial Results
The net loss for the third quarter of 2018 was $4.6 million compared with $4.0 million for the third quarter of 2017. The net loss for the first nine months of 2018 was $14.1 million compared with $13.0 million for the first nine months of 2017.

All revenues were related to the company’s collaboration with Novartis. Total revenues were $7.7 million for the third quarter of 2018 compared with $9.6 million for the third quarter of 2017. Total revenues were $26.2 million for the first nine months of 2018 compared with $26.6 million for the first nine months of 2017. The decreases in revenues for both periods were primarily due to lower emricasan-related research and development expenses resulting in corresponding lower revenues from Novartis, partially offset by the effects of adopting the ASC 606 revenue recognition standard.

Research and development expenses were $9.7 million for the third quarter of 2018 compared with $11.2 million for the third quarter of 2017. The decrease in research and development expenses was primarily due to lower spending related to the ENCORE-NF and ENCORE-PH clinical trials and manufacturing activities, partially offset by higher spending related to the ENCORE-LF clinical trial. Research and development expenses were $32.5 million for the first nine months of 2018 compared with $32.3 million for the first nine months of 2017. The increase in research and development expenses was primarily due to higher spending related to the ENCORE-LF and ENCORE-PH clinical trials and new product candidate development, partially offset by lower spending related to the ENCORE-NF clinical trial and manufacturing activities.

General and administrative expenses were $2.7 million for the third quarter of 2018 compared with $2.4 million for the third quarter of 2017. General and administrative expenses were $8.0 million for the first nine months of 2018 compared with $7.4 million for the first nine months of 2017. The increases in general and administrative expenses for both periods were primarily due to higher personnel costs.

Cash, cash equivalents and marketable securities were $49.6 million at September 30, 2018, compared with $74.9 million at December 31, 2017, and a projected year-end 2018 balance of between $35 million and $40 million. The company believes that current financial resources, together with the anticipated reimbursements for 50% of the costs for the ongoing clinical trials, without including any potential milestone payments under the Novartis collaboration, are sufficient to maintain operations through the end of 2019, as well as to fund initial pipeline expansion activities.

Conference Call and Audio Webcast
Conatus will host a conference call and audio webcast at 4:30 p.m. Eastern Time today to discuss the financial results and provide a corporate update. To access the conference call, please dial 877-312-5857 (domestic) or 970-315-0455 (international) at least five minutes prior to the start time and refer to conference ID 5773926. A live and archived audio webcast of the call will also be available in the Investors section of the Conatus website at www.conatuspharma.com.

Clinical Genomics and Quest Diagnostics extend collaboration to provide InSure® ONE™, a fecal immunochemical test for colorectal cancer screening programs

On November 1, 2018 Clinical Genomics, a leading innovator of tests for colorectal cancer, and Quest Diagnostics (NYSE: DGX), the world’s leading provider of diagnostic information services, reported a 5-year extension to their U.S. supply agreement for the InSure ONE fecal immunochemical test (FIT) (Press release, Clinical Genomics, NOV 1, 2018, View Source [SID1234530506]). This agreement builds upon a long standing collaboration to provide InSure FIT and the new InSure ONE FIT for colorectal cancer screening programs.

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Clinical Genomics manufactures FIT tests, including InSure ONE, which Quest provides to physicians and organized provider groups across the United States. These provider groups include specialized programs to improve screening adherence rates for Accountable Care Organizations (ACOs) and other organizations focused on improving quality metrics under value-based care models. Quest is also an investor in the company. Under the agreement, Quest will continue to offer broad access to both the Insure FIT and Insure ONE FIT products in the U.S.

"We are pleased to continue this important partnership with Quest Diagnostics ensuring that screening programs have broad access to InSure ONE, an easy to use FIT that may lead to improved patient compliance," says Betsy Hanna, Chief Commercial Officer, Clinical Genomics.

"Barriers to screening often delay or prevent early diagnosis," said Kristie Dolan, General Manager, Oncology, Quest Diagnostics. "Insure ONE FIT helps overcome several of these screening barriers to prompt earlier screening. Our collaboration with Clinical Genomics will ensure that patients and providers in the U.S. continue to have broad access to the innovative Insure FIT and the new InSure ONE FIT."

InSure ONE is an FDA 510(k) cleared FIT for detecting blood in stool as an aid in the detection of lower gastrointestinal bleeding. A number of medical conditions may be associated with lower gastrointestinal bleeding, including colorectal cancer, iron deficiency anemia, diverticulitis, ulcerative colitis, polyps, and adenomas.

Unlike other FIT’s, InSure ONE is the only test that is performed using toilet water collected from a single bowel movement. InSure ONE employs a patented brush sampling method which has been preferred by many doctors and patients for more than 15 years. A water sample is collected from the toilet bowel by simply brushing the surface of the stool to release any blood into the surrounding water, rather than having to collect a stool sample or smear feces.

Annual FIT is recommended by the American Cancer Society (ACS) for screening programs to detect the early signs of adenomatous polyps, precursors to cancer, and colorectal cancer. Recently, the ACS updated its recommendations lowering the screening age from 50 to 45 years. FIT, along with colonoscopy, is also recommended as a ‘Tier 1’ preferred test for colorectal cancer screening programs by the U.S. Multi-Society Task Force (MSTF). When considering large, organized colorectal cancer screening programs, the U.S. MSTF also recognizes that given the annual nature of FIT and the performance characteristics of this assay in identifying blood in the stool, FIT is "more effective and less costly" than the use every 3 years of FIT-fecal DNA, approved by FDA specifically for use in colorectal cancer screening.1

Colorectal cancer is the second leading cause of cancer death in the United States, with more than 140,000 people per year expected to be diagnosed with the disease and an estimated 50,000 who will die from it. According to U.S. Preventative Service Task Force recommendations, screening for colorectal cancer in adults who are 50 to 75 years old and at average risk reduces colorectal cancer mortality. Many people, however, are not screened according to guidelines, and studies show aversion to colonoscopy and other methods may factor into decisions not to screen. The disease is often highly treatable when caught in early stages.

Rex DK, et.al. U.S. MSTF Consensus Guideline, Gastroenterology 2017; 153:307-323

Cerus Corporation Reports Third Quarter 2018 Results

On November 1, 2018 Cerus Corporation (Nasdaq: CERS) reported financial results for the third quarter ended September 30, 2018 (Press release, Cerus, NOV 1, 2018, View Source [SID1234530505]).

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Third Quarter Highlights and Recent Events

Third quarter product revenue of $15.4 million, a 43% increase compared to the third quarter of 2017
Year-over-year worldwide disposable kit volumes increased 85% in the third quarter of 2018
2018 product revenue guidance revised upwards to a range of $58 million to $60 million, representing an increase of 33% to 38% compared to 2017 product revenue
Notified TÜV SÜD in October of the Company’s request to file its planned CE Mark submission in 60 days for INTERCEPT red blood cells
Received FDA Breakthrough Device Designation for pathogen-reduced cryoprecipitate
"The market adoption of the INTERCEPT Blood System continues to be strong with third quarter product revenue totaling $15.4 million," said William ‘Obi’ Greenman, Cerus’ president and chief executive officer. "Year-over-year product revenue growth was driven by sales of INTERCEPT platelet kits and was broad based with all major geographic regions delivering gains. Given our strong year-to-date results and increasing visibility into our commercial pipeline, we recently revised our 2018 product revenue guidance to a range of $58 million to $60 million."

"In addition to our strong third quarter results, we recently notified TÜV SÜD, our Notified Body, of our request to file our CE Mark submission in 60 days for INTERCEPT red blood cells. Our red cell team is working diligently in preparation for the planned submission and is on track to deliver on this important milestone," continued Greenman.

A Notified Body is an organization accredited by a member country of the European Union to determine if a product conforms to predetermined standards.

Revenue

Product revenue during the third quarter of 2018 was $15.4 million, compared to $10.8 million during the same period in 2017. The increase in third quarter product revenue was led by gains in platelet kit sales, which were partially offset by a year-over-year decline in illuminator sales. Third quarter 2017 illuminator sales benefited from the initial instrument shipments pursuant to the Company’s expanded supply agreement with EFS, the French National Blood Service. Year-to-date product revenue totaled $44.4 million, an increase of 62% compared to the same period of the prior year.

Government contract revenue from the Company’s Biomedical Advanced Research and Development Authority (BARDA) agreement was $3.9 million during the third quarter of 2018, compared to $2.3 million during the same period in 2017, as a result of increasing INTERCEPT red cell clinical and development activities. Year-to-date government contract revenue totaled $11.4 million compared to $5.4 million in the first nine months of 2017.

BARDA is part of the Office of the Assistant Secretary for Preparedness and Response within the U.S. Department of Health and Human Services. The development of the INTERCEPT red blood cell program has been funded in whole or in part with Federal funds from the Department of Health and Human Services; Office of the Assistant Secretary for Preparedness and Response; Biomedical Advanced Research and Development Authority, under Contract No. HHSO100201600009C.

Gross Margins

Gross margins on product revenue during the third quarter of 2018 were 47%, compared to 50% for the third quarter of 2017. The change in gross margin was primarily attributable to lower selling prices associated with high volume customers, and to a lesser extent, the unfavorable impact of foreign exchange rates. Gross margins through the first nine months of 2018 were 48% compared to 51% in the same period of the prior year.

Operating Expenses

Total operating expenses were $24.8 million for the quarter ended September 30, 2018, compared to $20.1 million for the quarter ended September 30, 2017. Year-to-date, operating expenses totaled $72.2 million compared to $66.0 million in the same period of the prior year.

Selling, general, and administrative (SG&A) expenses for the third quarter of 2018 totaled $14.0 million, compared to $12.2 million for the third quarter of 2017. The year-over-year increase was primarily tied to higher commercial activity in the U.S. Year-to-date SG&A expenses totaled $42.0 million, compared to $40.1 million during the first nine months of 2017.

Research and development (R&D) expenses for the third quarter of 2018 were $10.8 million, compared to $7.9 million for the third quarter of 2017. The increase in year-over-year R&D expenses was primarily due to additional activities and costs tied to the development of INTERCEPT red blood cells, including preparation for the planned CE Mark submission, trials and activities in pursuit of FDA approval of INTERCEPT red blood cells and activities aimed at expanded label claims for INTERCEPT platelets and plasma. Year-to-date R&D expenses through the third quarter of 2018 totaled $30.1 million, compared to $25.9 million during the first nine months of 2017.

Net Loss

Net loss for the third quarter of 2018 was $14.2 million, or $0.11 per diluted share, compared to a net loss of $13.4 million, or $0.12 per diluted share, for the third quarter of 2017. Year-to-date net loss was $41.4 million, or $0.32 per diluted share, compared to a net loss of $49.1 million, or $0.46 per diluted share, in the first nine months of 2017.

Cash, Cash Equivalents and Investments

At September 30, 2018, the Company had cash, cash equivalents and short-term investments of $119.0 million, compared to $60.7 million at December 31, 2017.

At September 30, 2018, the Company had approximately $29.9 million in outstanding debt under its loan agreement with Oxford Finance compared to $29.8 million at December 31, 2017.

QUARTERLY CONFERENCE CALL

The Company will host a conference call and webcast at 4:15 P.M. EDT this afternoon, during which management will discuss the Company’s financial results and provide a general business overview and outlook. To access the live webcast, please visit the Investor Relations page of the Cerus website at View Source Alternatively, you may access the live conference call by dialing (866) 235-9006 (U.S.) or (631) 291-4549 (international).

A replay will be available on the Company’s website, or by dialing (855) 859-2056 (U.S.) or (404) 537-3406 (international) and entering conference ID number 7095077. The replay will be available approximately three hours after the call through November 15, 2018.