On July 27, 2018 Merck (NYSE: MRK), known as MSD outside the United States and Canada, reported financial results for the second quarter of 2018 (Press release, Merck & Co, JUL 27, 2018, View Source [SID1234527919]).

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"Strong commercial execution globally for KEYTRUDA, GARDASIL, BRIDION and other products led the company to deliver growth in the second quarter," said Kenneth C. Frazier, Merck Chairman and CEO. "We continue to solidify our leadership in immuno-oncology and, along with our other key pillars of growth including Animal Health, we are confident in the strength of our business."

GAAP (generally accepted accounting principles) earnings per share assuming dilution (EPS) were $0.63 for the second quarter of 2018. Non-GAAP EPS of $1.06 for the second quarter of 2018 excludes acquisition- and divestiture-related costs, restructuring costs and certain other items. Year-to-date results can be found in the attached tables.

Oncology Pipeline Highlights

Merck continued to expand its oncology program by further advancing the development programs for KEYTRUDA (pembrolizumab), the company’s anti-PD-1 therapy; Lynparza (olaparib), a PARP inhibitor being co-developed and co-commercialized with AstraZeneca; and Lenvima (lenvatinib mesylate), an orally available tyrosine kinase inhibitor being co-developed and co-commercialized with Eisai.

KEYTRUDA

Merck announced that the U.S. Food and Drug Administration (FDA) accepted for review a supplemental Biologics License Application (sBLA) for KEYTRUDA as a first-line treatment for metastatic squamous non-small cell lung cancer (NSCLC), regardless of PD-L1 expression. The sBLA, which is seeking accelerated approval for this new indication, is based on overall response rate (ORR) data from the pivotal Phase 3 KEYNOTE-407 trial, which were recently presented at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) 2018 Annual Meeting. The FDA granted Priority Review and set a PDUFA date of Oct. 30, 2018. Additional data showing a significant improvement in overall survival (OS) were also presented, making this the fifth study in advanced NSCLC in which KEYTRUDA demonstrated an improved survival benefit.

Merck announced results from KEYNOTE-042, a pivotal Phase 3 study evaluating KEYTRUDA as monotherapy for the first-line treatment of locally advanced or metastatic nonsquamous or squamous NSCLC with PD-L1 tumor proportion score of ≥1 percent without EGFR or ALK genomic tumor aberrations. In this study, KEYTRUDA monotherapy resulted in significantly longer OS than platinum-based chemotherapy. These results were presented in the plenary session and during the press program at ASCO (Free ASCO Whitepaper) 2018.
Merck announced interim data from a cohort of the Phase 2 KEYNOTE-158 study evaluating KEYTRUDA as monotherapy in patients with previously treated advanced small cell lung cancer (SCLC). Findings showed an ORR, the primary endpoint of the study, of 18.7 percent in patients in the SCLC cohort. Additionally, in a pre-specified exploratory analysis, ORR was 35.7 percent in patients whose tumors expressed PD-L1 with a combined positive score (CPS) of ≥1. These results, as well as other findings from the KEYNOTE-158 cohort in SCLC, were presented for the first time at ASCO (Free ASCO Whitepaper) 2018.

The company announced that the pivotal Phase 3 KEYNOTE-048 trial investigating KEYTRUDA for first-line treatment of recurrent or metastatic head and neck squamous cell carcinoma (HNSCC), met a primary endpoint of OS as monotherapy in patients whose tumors expressed PD-L1 (CPS≥20). KEYTRUDA is the first anti-PD-1 therapy to show an OS benefit as first-line therapy for recurrent or metastatic HNSCC. At the time of the interim analysis, the dual-primary endpoint of progression-free survival (PFS) for patients whose tumors expressed PD-L1 (CPS≥20) had not been reached. These results will be presented at an upcoming medical meeting and submitted to regulatory authorities worldwide.

Merck announced that KEYTRUDA has been approved by the China National Drug Administration for the treatment of adult patients with unresectable or metastatic melanoma following failure of one prior line of therapy. This is the first and only approval of an anti-PD-1 therapy for advanced melanoma in China.
The FDA accepted and granted Priority Review for a new sBLA seeking approval for KEYTRUDA as a treatment for previously treated patients with advanced hepatocellular carcinoma, based on data from the Phase 2 KEYNOTE-224 trial, which were presented at ASCO (Free ASCO Whitepaper) 2018. The FDA set a PDUFA date of Nov. 9, 2018.
Merck announced that the FDA accepted for standard review a new sBLA for KEYTRUDA as adjuvant therapy in the treatment of patients with resected, high-risk stage III melanoma and granted a PDUFA date of Feb. 16, 2019. This sBLA is based on a significant benefit in recurrence-free survival demonstrated by KEYTRUDA in the pivotal Phase 3 EORTC1325/ KEYNOTE-054 trial, which was conducted in collaboration with the European Organisation for Research and Treatment of Cancer.

The FDA approved KEYTRUDA for two new indications under its accelerated approval regulations based on tumor response rate and durability of response:
For the treatment of adult and pediatric patients with refractory primary mediastinal large B-cell lymphoma, or who have relapsed after two or more prior lines of therapy.
For the treatment of patients with recurrent or metastatic cervical cancer with disease progression on or after chemotherapy whose tumors express PD-L1 as determined by an FDA-approved test.
Lynparza

Merck and AstraZeneca announced positive results from the randomized, double-blinded, placebo-controlled, Phase 3 SOLO-1 trial of Lynparza tablets, showing women with BRCA-mutated (BRCAm) advanced ovarian cancer treated first-line with Lynparza maintenance therapy had a statistically significant and clinically meaningful improvement in PFS compared to placebo.

Merck and AstraZeneca announced that Japan’s Pharmaceuticals and Medical Devices Agency approved Lynparza tablets for use in patients with unresectable or recurrent BRCAm, human epidermal growth factor receptor 2 (HER2)-negative breast cancer who have received prior chemotherapy.

Merck and AstraZeneca announced that the European Medicines Agency approved Lynparza tablets for use as a maintenance therapy for patients with platinum-sensitive relapsed high-grade, epithelial ovarian, fallopian tube or primary peritoneal cancer who are in complete response or partial response to platinum-based chemotherapy, regardless of BRCA status.

Merck and AstraZeneca presented data from the Phase 2 Study 08 trial, which showed clinical improvement in median radiologic PFS with Lynparza in combination with abiraterone compared to abiraterone monotherapy, a current standard of care, in metastatic castration-resistant prostate cancer.
Lenvima

Merck and Eisai announced results from presentations of new data and analyses of Lenvima in combination with KEYTRUDA in four different tumor types: unresectable hepatocellular carcinoma, squamous cell carcinoma of the head and neck, advanced renal cell carcinoma and advanced endometrial carcinoma. The data were included in presentations at ASCO (Free ASCO Whitepaper) 2018.
Other Pipeline Highlights

The company also continued to advance its vaccines and HIV pipelines.

Merck announced that the FDA accepted for review a new sBLA for GARDASIL 9 (Human Papillomavirus 9-valent Vaccine, Recombinant), the company’s nine-valent HPV vaccine, for an expanded age indication for use in women and men 27 to 45 years old for the prevention of certain cancers and diseases caused by the nine human papillomavirus (HPV) types covered by the vaccine. The FDA granted Priority Review and set a PDUFA date of Oct. 6, 2018.

China’s Food and Drug Administration approved GARDASIL 9 for use in girls and women 16 to 26 years old.
Merck announced Week 96 results from the Phase 3 DRIVE-FORWARD clinical trial evaluating the efficacy and safety of doravirine (DOR), the company’s investigational non-nucleoside reverse transcriptase inhibitor, in combination with other antiretroviral agents, for the treatment of HIV-1 infection in adult patients with no prior antiretroviral treatment history. At Week 96, 73.1 percent of the group treated with once-daily DOR plus FTC/TDF or ABC/3TC achieved viral suppression as measured by the proportion of patients who achieved HIV-1 RNA of less than 50 copies/mL, compared to 66.0 percent of the group treated with once-daily ritonavir-boosted darunavir (DRV+r) plus FTC/TDF or ABC/3TC. These study results were presented as a late-breaking abstract at the recent 22nd International AIDS Conference.
Second-Quarter Revenue Performance

Second-quarter pharmaceutical sales increased 6 percent to $9.3 billion, including a 3 percent positive impact from foreign exchange. The increase was primarily driven by growth in oncology, vaccines and hospital acute care, partially offset by lower sales in virology and the ongoing impacts of the loss of market exclusivity for several products.

Growth in oncology was driven by a significant increase in sales of KEYTRUDA, reflecting the company’s continued launches with new indications globally and the strong momentum for the treatment of patients with NSCLC, as KEYTRUDA is the only anti-PD-1 approved in the first-line setting. Additionally, oncology sales reflect alliance revenue of $44 million related to Lynparza and $35 million related to Lenvima, which represents Merck’s share of profits from product sales, net of cost of sales and commercialization costs.

Growth in vaccines was primarily driven by higher sales of GARDASIL [Human Papillomavirus Quadrivalent (Types 6, 11, 16 and 18) Vaccine, Recombinant] and GARDASIL 9, vaccines to prevent certain cancers and other diseases caused by HPV, reflecting growth in Asia Pacific, primarily due to the ongoing commercial launch in China, and growth in Europe, partially offset by lower sales in the United States due to the continued transition to the two-dose regimen. Vaccines performance was negatively affected by a significant decrease in sales of ZOSTAVAX (zoster vaccine live), a vaccine for the prevention of herpes zoster, primarily due to the approval of a competitor product that received a preferential recommendation from the U.S. Advisory Committee on Immunization Practices in October 2017. The company anticipates that future sales of ZOSTAVAX will continue to be unfavorably affected by this competition.

Growth in hospital acute care reflects strong global demand of BRIDION (sugammadex) Injection 100 mg/mL, a medicine for the reversal of neuromuscular blockade induced by rocuronium bromide or vecuronium bromide in adults undergoing surgery.

Pharmaceutical sales growth in the quarter was partially offset by lower sales in virology, largely reflecting a significant decline in ZEPATIER (elbasvir and grazoprevir), a medicine for the treatment of chronic hepatitis C virus genotypes 1 or 4 infection, due to increasing competition and declining patient volumes, which the company expects to continue.

Pharmaceutical sales growth for the quarter was also partially offset by the ongoing impacts from the loss of U.S. market exclusivity for ZETIA (ezetimibe) in late 2016 and VYTORIN (ezetimibe/simvastatin) in April 2017, medicines for lowering LDL cholesterol; and biosimilar competition for REMICADE (infliximab), a treatment for inflammatory diseases, in the company’s marketing territories in Europe.

Animal Health

Animal Health sales totaled $1.1 billion for the second quarter of 2018, an increase of 14 percent compared with the second quarter of 2017, including a 2 percent positive impact from foreign exchange. Growth was driven by higher sales of companion animal products, primarily from the BRAVECTO (fluralaner) line of products that kill fleas and ticks in dogs and cats for up to 12 weeks, due in part to a delayed flea and tick season and the timing of customer purchases. Growth was also driven by livestock products, including poultry, ruminants and swine products.

Animal Health segment profits were $450 million in the second quarter of 2018, an increase of 14 percent compared with $395 million in the second quarter of 2017.3

Second-Quarter Expense, EPS and Related Information

Gross margin was 67.3 percent for the second quarter of 2018 compared to 68.6 percent for the second quarter of 2017. The decrease in gross margin for the second quarter of 2018 was primarily driven by the amortization of amounts capitalized for potential future milestone payments related to collaborations, the amortization of unfavorable manufacturing variances, in part resulting from the June 2017 cyber-attack, as well as the unfavorable effects of foreign exchange. The decrease was partially offset by a lower net impact of acquisition- and divestiture-related costs and restructuring costs, which reduced gross margin by 7.1 percentage points in the second quarter of 2018 compared with 8.7 percentage points in the second quarter of 2017.

Marketing and administrative expenses were $2.5 billion in the second quarter of 2018, comparable to the second quarter of 2017, reflecting the unfavorable effects of foreign exchange and higher administrative costs, offset by lower promotion and direct selling costs.

Research and development (R&D) expenses were $2.3 billion in the second quarter of 2018 compared with $1.8 billion in the second quarter of 2017. The increase was driven primarily by a $344 million charge for the Viralytics Limited (Viralytics) acquisition, increased clinical development spending, in particular from oncology collaborations, as well as investment in early drug development.

GAAP EPS was $0.63 for the second quarter of 2018 compared with $0.71 for the second quarter of 2017.

Non-GAAP Expense, EPS and Related Information

The non-GAAP gross margin was 74.4 percent for the second quarter of 2018 compared to 77.3 percent for the second quarter of 2017. The decrease in non-GAAP gross margin was predominantly due to the amortization of amounts capitalized for potential future milestone payments related to collaborations, the amortization of unfavorable manufacturing variances, in part resulting from the June 2017 cyber-attack, as well as the unfavorable effects of foreign exchange.

Non-GAAP marketing and administrative expenses were $2.5 billion in the second quarter of 2018, comparable to the second quarter of 2017, reflecting the unfavorable effects of foreign exchange and higher administrative costs, offset by lower promotion and direct selling costs.

Non-GAAP R&D expenses were $1.9 billion in the second quarter of 2018, a 9 percent increase compared to the second quarter of 2017. The increase primarily reflects higher clinical development spending, in particular from oncology collaborations, as well as investment in early drug development.

Non-GAAP EPS was $1.06 for the second quarter of 2018 compared with $1.01 for the second quarter of 2017.

Merck narrowed its full-year 2018 revenue range to be between $42.0 billion and $42.8 billion, including a slightly positive impact from foreign exchange at current exchange rates.

Merck narrowed and raised its full-year 2018 GAAP EPS range to be between $2.51 and $2.59. Merck narrowed and raised its full-year 2018 non-GAAP EPS range to be between $4.22 and $4.30. Both include an approximately 1 percent negative impact from foreign exchange at current exchange rates. The non-GAAP range excludes acquisition- and divestiture-related costs, costs related to restructuring programs, charges related to the formation of the Eisai collaboration and the Viralytics acquisition, and certain other items.

*The company does not have any non-GAAP adjustments to revenue.

**EPS guidance for 2018 assumes a share count (assuming dilution) of approximately 2.7 billion shares.

A reconciliation of anticipated 2018 GAAP EPS to non-GAAP EPS and the items excluded from non-GAAP EPS are provided in the table below.

The expected full-year 2018 GAAP effective tax rate of 23.0 percent to 24.0 percent reflects an unfavorable impact of approximately 4.5 percentage points from the above items.

Earnings Conference Call

Investors, journalists and the general public may access a live audio webcast of the call today at 8:00 a.m. EDT on Merck’s website at View Source Institutional investors and analysts can participate in the call by dialing (706) 758-9927 or (877) 381-5782 and using ID code number 6985606. Members of the media are invited to monitor the call by dialing (706) 758-9928 or (800) 399-7917 and using ID code number 6985606. Journalists who wish to ask questions are requested to contact a member of Merck’s Media Relations team at the conclusion of the call.

On July 27, 2018 ImmunoGen, Inc., (Nasdaq: IMGN), a leader in the expanding field of antibody-drug conjugates (ADCs) for the treatment of cancer, reported its operating results for the quarter ended June 30, 2018 (Press release, ImmunoGen, JUL 27, 2018, View Source [SID1234527918]).

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"During the second quarter, we made significant progress with mirvetuximab soravtansine, highlighted by FDA Fast Track designation for the treatment of platinum-resistant ovarian cancer, and completion of enrollment in our FORWARD I registration study, which positions us well to report top-line data in the first half of 2019," said Mark Enyedy, ImmunoGen’s President and Chief Executive Officer. "In addition, we expanded the growing body of clinical data supporting mirvetuximab’s potential to treat a broader population of women with ovarian cancer in combination with other agents. Data from our FORWARD II Avastin and carboplatin cohorts show encouraging clinical activity and tolerability, and support the triplet combination currently in clinical testing. We look forward to presenting additional data for mirvetuximab and Keytruda during 2018 with a poster presentation at ESMO (Free ESMO Whitepaper) that will describe the initial findings from this expansion cohort. Looking at our earlier-stage pipeline of novel IGN ADCs for hematological malignancies, we expect to report data from our Phase 1 trials of IMGN779 and IMGN632 in the fourth quarter. Finally, we strengthened our financial position with an upsized and oversubscribed public offering that generated $163 million in net proceeds and extends our cash runway at least a year beyond the Phase 3 readout of FORWARD I."

CLINICAL PROGRESS

· In June, the Company received U.S. Food and Drug Administration (FDA) Fast Track designation for mirvetuximab soravtansine for the treatment of patients with medium to high folate receptor alpha (FRα)-positive platinum-resistant ovarian cancer who received at least one, but no more than three prior systemic treatment regimens, and for whom single-agent chemotherapy is appropriate as the next line of therapy. This designation is intended to facilitate the development and expedite the review of drugs to treat serious and life-threatening conditions.

· In June, the Company presented encouraging data from the FORWARD II expansion cohort evaluating mirvetuximab in combination with bevacizumab (Avastin) at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting, which demonstrated anti-tumor activity with durable responses and favorable tolerability in patients with platinum-resistant ovarian cancer.

· In May, the Company reported updated data from the FORWARD II dose-escalation cohort evaluating mirvetuximab in combination with carboplatin in patients with recurrent platinum-sensitive ovarian cancer, demonstrating a favorable safety profile along with an increased response rate and more durable benefit after longer-term follow up.

· The findings from the carboplatin and Avastin doublets support the ongoing FORWARD II cohort assessing a triplet combination of mirvetuximab plus carboplatin and Avastin in patients with recurrent platinum-sensitive ovarian.

· In April, the Company announced it completed patient enrollment ahead of schedule in its FORWARD I Phase 3 trial.

RECENTLY COMPLETED PUBLIC OFFERING

· In June, ImmunoGen completed a public offering of its common stock raising total net proceeds of approximately $163 million, after deducting underwriting discounts and offering expenses.

PARTNER UPDATES

· In May, Takeda enrolled the first patient in its Phase 1 clinical trial of TAK-164, an ADC integrating ImmunoGen’s IGN payload, in patients with gastrointestinal cancers, which triggered a milestone payment to ImmunoGen.

ANTICIPATED UPCOMING EVENTS

· Report initial findings from the FORWARD II expansion cohort of mirvetuximab in combination with pembrolizumab (Keytruda) for 35 patients with medium or high FRα expression at the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) 2018 Congress in October;

· Report additional data from IMGN779 Phase 1 dose finding study in 4Q 2018;

· Report initial data from IMGN632 Phase 1 dose finding study in 4Q 2018;

· Advance ADAM9 ADC program into IND-enabling activities before year-end; and

· Report top-line results from Phase 3 FORWARD I trial of mirvetuximab in 1H 2019.

FINANCIAL RESULTS

Revenues for the quarter ended June 30, 2018 were $9.3 million, compared with $39 million for the quarter ended June 30, 2017. License and milestone fees of $1.3 million for the second quarter of 2018 included $1 million and $0.3 million of recognized upfront fees previously received from Novartis and Fusion, respectively, compared to recognition of a $30 million paid-up license fee received from Sanofi and a $1 million Phase 1 milestone received from CytomX for the same quarter in 2017. The Company also received a $5 million milestone from Takeda during the second quarter of 2018 related to the start of Phase 1 testing of TAK-164, which was recorded as of January 1, 2018 as part of the transition to the new revenue recognition rules and is therefore not reflected in revenue in the current period.

Revenues in the second quarter of 2018 included $7.2 million in non-cash royalty revenues, compared with $6.4 million for the same quarter in 2017. Revenues for the second quarter of 2018 also included $0.4 million of research and development (R&D) support fees and $0.3 million of clinical materials revenue, compared with $0.9 million and $0.6 million, respectively, for the same quarter in 2017.

Operating expenses for the second quarter of 2018 were $48 million, compared with $44.2 million for the same quarter in 2017. The increase was driven by R&D expenses, which increased to $38.7 million in the second quarter of 2018, compared with $35.3 million for the second quarter of 2017. This increase was primarily due to higher clinical trial costs driven largely by continued advancement of the FORWARD I Phase 3 clinical trial and, to a lesser extent, personnel expenses resulting from expanded headcount and stock-based compensation. General and administrative expenses decreased in the second quarter of 2018 to $8.7 million, compared to $8.8 million in the same quarter of 2017. Operating expenses for the second quarter of 2018 also included a $0.7 million restructuring charge due to the workforce reduction related to the decommissioning of our Norwood facility as previously announced by the Company.

ImmunoGen reported a net loss of $41.6 million, or $0.31 per basic and diluted share, for the second quarter of 2018, compared with a net loss of $8.9 million, or $0.10 per basic and diluted share, for the same quarter last year.

In June 2018, pursuant to a public offering, the Company sold an aggregate of 15.8 million shares of its common stock, with net proceeds to the Company of $162.5 million, after deducting underwriting discounts and offering expenses.

ImmunoGen had $345.1 million in cash and cash equivalents as of June 30, 2018, compared with $267.1 million as of December 31, 2017, and had $2.1 million of convertible debt outstanding in each period. Cash used in

operations was $85.3 million for the first six months of 2018, compared with $8.9 million for the same period in 2017. The prior period benefited from $55 million of fees received from Sanofi and Debiopharm. Capital expenditures were $2.1 million and $0.8 million for the six months ended June 30, 2018 and 2017, respectively.

FINANCIAL GUIDANCE

ImmunoGen has updated its cash and operating expenses guidance for 2018. ImmunoGen now expects:

· cash and cash equivalents at December 31, 2018 between $265 million and $270 million; and

· operating expenses between $215 million and $220 million.

Guidance for revenue remains unchanged:

· revenues between $60 million and $65 million.

ImmunoGen expects that its current cash combined with the expected cash revenues from partners and collaborators will enable the Company to fund its operations at least a year beyond the top-line results from the Phase 3 FORWARD I trial, which are expected in the first half of 2019.

CONFERENCE CALL INFORMATION

ImmunoGen will hold a conference call today at 8:00 am ET to discuss these results. To access the live call by phone, dial 719-785-1753; the conference ID is 2275763. The call may also be accessed through the Investors section of the Company’s website, www.immunogen.com. Following the webcast, a replay of the call will be available at the same location through August 10, 2018.

On July 26, 2018 DCprime reported that the results of the phase I study with its lead product DCP-001 in AML have been published in Cancer Immunology, Immunotherapy (Press release, DCPrime, JUL 26, 2018, View Source [SID1234529906]).

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The phase I study was conducted with DCP-001 in 12 advanced-stage elderly AML patients. Primary objectives of the study (feasibility and safety) were achieved with 10 out of the 12 patients completing the vaccination program. Treatment was well tolerated and it is concluded that DCP-001 in elderly AML patients is safe, feasible and generates both cellular and humoral immune responses.

Prof Dr Arjan van de Loosdrecht, Amsterdam UMC, VU University Medical Center, The Netherlands commented: "We are very glad that the phase-I study with the DCP-001 vaccine in AML is published, showing that it is safe, feasible and well tolerated. In addition, the vaccine generates both cellular and humoral immune responses and maintenance of these responses are observed in patients with a relatively long survival, suggesting a possible correlation. We are looking forward to the data of the phase-2 study, ADVANCE-II for patients with AML in complete remission after induction therapy with persistence of minimal residual disease, which is currently open for inclusion."

Dr Erik Manting, CEO of DCprime added: "Compliments to Prof Dr Arjan van de Loosdrecht and Prof Dr Tanja de Gruijl at VU University Medical Center and all others including our DCprime colleagues who contributed to this publication on the clinical study data with DCP-001 in AML. It underlines the promise and potency of the DCOne platform, which we continue to explore in AML and other cancer types."

On July 26, 2018 Sutro Biopharma, Inc., reported that it has secured $85.4 million in Series E financing to advance its wholly-owned pipeline of novel cancer therapeutics, including two internally-developed antibody drug conjugates, or ADCs, known as STRO-001, now in Phase 1 clinical testing for lymphoma and multiple myeloma, and STRO-002, which is expected to enter clinical trials for ovarian and endometrial cancer by early 2019 (Press release, Sutro Biopharma, JUL 26, 2018, View Source [SID1234529227]). Proceeds will also be used to further early stage programs and continued platform technology advancement. STRO-001 and STRO-002 were developed using Sutro’s proprietary cell-free protein synthesis and site-specific conjugation platforms, which facilitate precision design and rapid empirical optimization of protein conjugates to treat cancer and other diseases.

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The financing was led by Samsara BioCapital and Surveyor Capital (a Citadel company), and supported by current investors, Alta Partners, Amgen Ventures, Celgene Corporation, Lilly Ventures, Skyline Ventures and SV Health Investors. This financing also includes first-time investments from Eventide, Nexthera Capital, Vida Ventures and funds managed by Tekla Capital Management LLC. Additionally, Merck, known as MSD outside the United States and Canada, has made an investment and has made a commitment to a future investment. Mike Dybbs, PhD, Partner at Samsara BioCapital, will join the Sutro Board of Directors.

"With this latest round of funding, Sutro has raised over $175 million since its founding in 2003 – a vote of confidence in our work on a new generation of novel, targeted therapies with the potential for improved therapeutic profiles," Sutro CEO Bill Newell said.

Sutro’s Proprietary Cell-Free Platform

Sutro’s XpressCFTM and XpressCF+TM cell-free protein synthesis and site-specific conjugation platforms enable rapid evaluation of a wide variety of protein structures and design and manufacturing of a highly-optimized single molecular species, rather than the usual mixture of imprecisely conjugated antibodies that comprise an ADC made by conventional cell-based manufacturing.

This cell-free technology should allow Sutro to move optimized proteins seamlessly through every stage of development — from discovery through commercial-stage production, without needing to generate individual cell lines for protein production.

Sutro’s manufacturing center in San Carlos, California, is the first and only current cGMP compliant scalable cell-free protein synthesis manufacturing facility and is built to maximize the speed and efficiency of protein production.

Dr. Trevor Hallam, Sutro’s chief scientific officer, said: "With XpressCF+TM, we incorporate non-natural amino acids into specific positions on the generated antibody for site-specific conjugation of cytotoxins with a linker and warhead to enable consistent, stable, pinpoint placement of STRO-001’s toxic payload. This leads to highly efficient delivery of the cytotoxin to tumor cells. By contrast, earlier generations of ADCs can have unpredictable pharmacologic properties, resulting in the potential for sub-optimal stability, compromised efficacy and poor tolerability for patients."

On July 26, 2018 Genprex, Inc. (NASDAQ:GNPX), a clinical stage gene therapy company developing a new approach to treating cancer based upon a novel proprietary technology platform, reported that it has entered a Sponsored Research Agreement ("Agreement") with The University of Texas MD Anderson Cancer Center under which Genprex will sponsor a pre-clinical study, entitled "A Novel Therapeutic Approach for the Treatment of Cancer Using a Combination of the Multifactorial Tumor Suppressor Gene TUSC2 and Immunotherapy," to be conducted under the direction of Jack A. Roth, MD, FACS (Press release, Genprex, JUL 26, 2018, View Source [SID1234529158]). TUSC2 is the active agent in Genprex’s investigational drug candidate Oncoprex.

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The study, which is built upon strong data from pre-clinical research conducted at MD Anderson, is intended to develop a novel therapeutic approach for the treatment of cancer using a combination of the multifactorial tumor suppressor gene TUSC2 and immunotherapy, including the immune checkpoint inhibitors anti-PD1 and/or anti CTLA-4. The study will include the identification of biomarkers to predict the response to TUSC2-immunotherapy combinations.

Under the Agreement, MD Anderson will provide all necessary personnel, equipment, supplies, facilities and resources to perform the study; and Genprex will pay MD Anderson an amount equal to its expenditures and reasonable overhead in conducting the study in an amount of $2.0 million.

"This research program will evaluate the ability of TUSC2 gene therapy to synergistically enhance the effect and clinical utility of anti-PD1 and/or anti-CTLA-4 therapies," said Rodney Varner, Chairman and Chief Executive Officer of Genprex. "Identifying biomarkers that can predict response rates for Oncoprex-immunotherapy combinations may allow us to explore the utility of this treatment regimen in a broader array of cancers."

Varner added, "While immunotherapies represent an important advance in treating cancer, even in highly immunogenic tumors, the majority of patients do not respond to checkpoint inhibition. Combination therapies targeting multiple anti-cancer pathways represent a promising approach to achieving greater response rates, and may also allow the expanded use of immunotherapies in a larger population of cancer patients who are not currently candidates for these treatments."

Researchers at MD Anderson reported data from preclinical research at the 2017 meeting of the American Association for Cancer Research (AACR) (Free AACR Whitepaper) demonstrating that TUSC2 alone or in combination with checkpoint blockade (anti-PD-1 and/or anti-CTLA4) significantly prolonged mouse survival in a non-small cell lung cancer metastasis model compared to checkpoint blockade alone. The greatest increase in survival was seen with TUSC2 combined with checkpoint blockade. The treatment response was associated with high infiltration of natural killer (NK) cells and CD8 T cells, and low infiltration of myeloid-derived suppressor cells (MDSC) in the tumor microenvironment.