On November 15, 2019 Xenetic Biosciences, Inc. (NASDAQ: XBIO) ("Xenetic" or the "Company"), a biopharmaceutical company developing next-generation biologic drugs and novel orphan oncology therapeutics, reported its financial results for the three months ended September 30, 2016 (Press release, Xenetic Biosciences, NOV 15, 2016, View Source [SID1234537809]).

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Xenetic also provided an update to its corporate progress, clinical and regulatory status and anticipated milestones for the Company’s lead product candidates, including ErepoXen, a polysialylated form of erythropoietin for the treatment of anemia in pre-dialysis patients with chronic kidney disease, and FDA orphan designated oncology therapeutics Virexxa and Oncohist for the treatment of progesterone receptor negative endometrial cancer and refractory Acute Myeloid Leukemia.

Recent Corporate Highlights

Announced uplisting and trading of its common stock on The Nasdaq Capital Market;
Closed $10 million public offering; OPKO Health, Inc. (Nasdaq: OPK) along with other healthcare institutional investors participated in the offering;
Commenced collaboration with Excivion Ltd. to develop a vaccine against Zika and dengue viruses utilizing Xenetic’s proprietary IMUXEN Technology; and
Bolstered Board of Directors with appointment of Jeffrey F. Eisenberg; industry veteran with expertise in R&D, operations, manufacturing/quality, business development, strategic partnering, product development, commercialization, and talent management.
"The achievements we’ve made in 2016, including our recent uplist to Nasdaq and announcements of key partnerships and appointments, have enabled us to make substantial corporate progress and created a solid foundation on which we expect to build significant momentum in 2017," stated Scott Maguire, CEO. "Our programs continue to move forward and position Xenetic for success in developing biologic drugs and novel oncology therapeutics, that we believe have the potential to provide safe and well tolerated therapy options for patients with a variety of indications."

Program Updates

Xenetic is working together with Shire plc (formerly Baxalta, Baxter Incorporated and Baxter Healthcare) to develop a novel series of polysialylated blood coagulation factors utilizing Xenetic’s PolyXen technology, including a next generation Factor VIII. Shire is currently evaluating their product candidate BAX826, an investigational, extended half-life recombinant Factor VIII treatment for hemophilia A, for the treatment of hemophilia in a Phase 2a clinical study. Shire expects to report topline data from this Phase 2a study in Q1 2017.

ErepoXen: polysialylated form of recombinant human erythropoietin (EPO), a hormone produced by the kidneys to maintain red blood cell production and prevent anemia.

Recent ErepoXen Program Highlights

Reported positive topline data from the third cohort of its Phase 2 dose-escalation study with its lead drug candidate ErepoXen for the treatment of anemia in pre-dialysis chronic kidney disease patients
ErepoXen is under investigation to reduce the required frequency of dosage and side effects and to be less immunogenic than existing treatments. Clinical results of ErepoXen suggest that the drug candidate can be administered once a month. ErepoXen is currently in Phase 2/3 clinical development in collaboration with the Serum Institute of India and SynBio of Russia.

Expected Near-Term Milestones

Complete patient recruitment in Phase 2 dose-escalation study of ErepoXen for the treatment of Anemia; and
Report topline data from fourth and fifth cohorts of Phase 2 dose-escalation study for the treatment of anemia in pre-dialysis chronic kidney disease patients in 2017.
Virexxa: (sodium cridanimod), a small-molecule immunomodulator and interferon inducer, currently being studied in an ongoing Phase 2 multi-national study for the treatment of progesterone receptor negative endometrial cancer. Virexxa is also in pre-clinical development for the treatment of triple negative breast cancer.

Recent Virexxa Program Highlights

Announced the U.S. Food and Drug Administration (FDA) acceptance of Investigational New Drug application (IND) to initiate Phase 2 clinical trial of Virexxa in endometrial cancer.
Xenetic is preparing to commence a 78-patient, Phase 2 clinical study of Virexxa in conjunction with progestin therapy for the treatment of endometrial cancer in women with recurrent or persistent disease who have failed progestin monotherapy. In addition, Virexxa is currently being evaluated in an ongoing Phase 2 multi-national study enrolling 58 subjects with documented evidence of progesterone receptor negative (PrR-negative) endometrial cancer as determined by tumor biopsy. The latter study is being conducted in conjunction with Pharmsynthez PJSC (St. Petersburg Russia) and its subsidiary AS Kevelt (Tallinn, Estonia). For more information on this Phase 2 study, please visit www.clinicaltrials.gov and reference Identifier NCT02064725.

Expected Near-Term Milestones

Initiate Phase 2 clinical study of Virexxa in conjunction with progestin therapy for the treatment of endometrial cancer in women with recurrent or persistent disease who have failed progestin monotherapy in Q2 2017; and
Submit IND for biomarker study of Virexxa for the treatment of triple negative breast cancer in Q1 2017.
Oncohist: a novel recombinant human histone H1.3 molecule for the treatment of refractory Acute Myeloid Leukemia (AML) with potential to treat numerous other cancer indications.

Oncohist is currently being evaluated in a Phase 1/2 trial for the treatment of Acute Myeloid Leukemia (AML) in refractory patients. This Phase 1/2 trial is designed to evaluate Oncohist as a combination therapy, together with Cytarabine and is being developed with the Company’s Russian partner, Pharmsynthez.

"Moving forward, we remain committed to aggressively advancing the development of our pipeline. We believe that our expected near term corporate and clinical advancements will continue to unlock and build shareholder value, in both the short-term and long-term," concluded Mr. Maguire.

Summary of Financial Results for Third Quarter 2016

For the three months ended September 30, 2016, the Company reported a net loss of $2,471,981, or a net loss per diluted share of $0.28, compared to a net loss of $5,323,699, or a net loss per diluted share of $1.26 for the three months ended September 30, 2015.

For the nine months ended September 30, 2016, the Company reported a net loss of $53,814,778, or a net loss per diluted share of $7.54, compared to a net loss of $8,880,086, or a net loss per diluted share of $2.10 for the nine months ended September 30, 2015.

The Company ended the quarter with approximately $0.2 million of cash and cash equivalents.

On November 7, 2016, the Company closed on a $10 million public offering and commenced trading of its common stock on The Nasdaq Capital Market.

On November 15, 2016 ZIOPHARM Oncology, Inc. (Nasdaq:ZIOP), a biopharmaceutical company focused on new immunotherapies, reported the publication of data demonstrating enhanced persistence of genetically modified T cells targeting leukemia through utilization of its non-viral Sleeping Beauty (SB) system to co-express membrane-bound IL-15 (mbIL15) and a CD19-specific chimeric antigen receptor (CAR) (Press release, Ziopharm, NOV 15, 2016, View Source [SID1234516794]). The article, titled "Tethered IL-15 augments antitumor activity and promotes a stem-cell memory subset in tumor-specific T cells," was published in the Proceedings of the National Academy of Sciences (PNAS) and is available online here.

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Using the SB system, researchers generated genetically modified T cells that preserved stem-cell memory (TSCM) by co-expressing the CAR with a fusion variant of IL-15. These engineered T cells were effective in treating established CD19+ leukemia in mice by facilitating the long-term persistence of TSCM cells sustained by signaling through mbIL15. These findings provide for a translational pipeline of immunotherapies with improved potential by combining mbIL15 and T cells with diverse specificities.

"The ability to generate CAR-T cells with preserved stem-cell memory is a novel strategy for promoting long-lived persistence and effectiveness of immunotherapies for the treatment of patients with cancers. Producing this rare, but highly desirable, T-cell subset has historically been a challenge," said Laurence Cooper, M.D., Ph.D., Chief Executive Officer of ZIOPHARM and an author of the publication.

"We have demonstrated the ability to incorporate membrane-bound IL-15 via the non-viral Sleeping Beauty platform, thereby enhancing T-cell survival and raising our expectations for corresponding therapeutic benefit. The fundamental role that IL-15 plays in T-cell activation and propagation makes it an attractive candidate to incorporate into engineered immunotherapies, and we are advancing CAR-modified T cells co-expressing mbIL15 to testing in humans," added Dr. Cooper.

The SB transposon-transposase is a unique non-viral system for introducing genes into cells and is exclusively licensed by Intrexon Corporation (NYSE:XON) through The University of Texas MD Anderson Cancer Center and accessed as part of ZIOPHARM’s collaboration with Intrexon.

On November 15, 2016 Teva Pharmaceutical Industries Ltd. (NYSE:TEVA) reported results for the quarter ended September 30, 2016 (Press release, Teva, NOV 15, 2016, View Source;p=RssLanding&cat=news&id=2222450 [SID1234516768]).

Q3 2016
Revenues $5.6 billion
Cash flow from operations $1.5 billion
GAAP EPS $0.35 984 million shares
Non-GAAP EPS $1.31 1,044 million shares

"This has been a year of transition for Teva, underscored this quarter by the close of our strategic acquisition of Actavis Generics, which had significant contribution to our results. Actavis will continue to contribute in a meaningful way to the future growth of our generics business through the strengthened R&D capabilities and complementary pipeline and portfolio, and enhance our leadership in an increasingly evolving industry," stated Erez Vigodman, Teva’s President and CEO. "We were also pleased to report this quarter that we have successfully completed the second pivotal phase three study for SD-809 for tardive dyskinesia and plan to submit that NDA to the U.S. FDA at the end of this year, and have also resubmitted SD-809 for Huntington disease in response to the FDA’s Complete Response Letter. Going forward, we will focus on also growing our specialty pipeline through in-house opportunities, including in the development and commercialization of our key pipeline assets, most notably our anti-CGRP product for migraine headaches and fasinumab. In the face of the industry and company-specific challenges we have been dealing with this year, we remain excited about the future as we strive to create a platform that is unique to the industry, working every day to find the delicate balance between access and innovation and laying the foundation for Teva’s continued growth."

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Third Quarter 2016 Results
Revenues in the third quarter of 2016 were $5.6 billion, up 15% compared to the third quarter of 2015, primarily due to the inclusion of revenues of $887 million of the Actavis generics business, following the closing of the acquisition on August 2. Excluding the impact of foreign exchange fluctuations, revenues increased 19%.

Exchange rate differences between the third quarter of 2016 and the third quarter of 2015 reduced revenues by $188 million, GAAP operating income by $83 million and non-GAAP operating income by $65 million.

GAAP gross profit was $2.8 billion in the third quarter of 2016, up 1% compared to the third quarter of 2015. GAAP gross profit margin was 50.4% in the quarter, compared to 57.5% in the third quarter of 2015. Non-GAAP gross profit was $3.4 billion in the third quarter of 2016, up 14% from the third quarter of 2015. Non-GAAP gross profit margin was 61.0% in the third quarter of 2016, compared to 61.8% in the third quarter of 2015.

Research and Development (R&D) expenses for the third quarter of 2016 amounted to $663 million, an increase of 84% compared to the third quarter of 2015 mainly due to $250 million paid to Regeneron pursuant to our collaborative agreement to develop and commercialize its pain medication product fasinumab. R&D expenses excluding equity compensation expenses and purchase of in-process R&D in the third quarter of 2016 were $406 million, compared to $356 million in the third quarter of 2015. R&D expenses were 7.3% of revenues in the quarter, compared to 7.4% in the third quarter of 2015. R&D expenses related to our generic medicines segment were $184 million, compared to $132 million in the third quarter of 2015, an increase of 39%, mainly due to the inclusion of two months of expenses of the Actavis generics business. R&D expenses related to our specialty medicines segment were $228 million, an increase of 4% compared to $220 million in the third quarter of 2015.

Selling and Marketing (S&M) expenses in the third quarter of 2016 amounted to $940 million, an increase of 21% compared to the third quarter of 2015. S&M expenses excluding amortization of purchased intangible assets and equity compensation expenses were $889 million, or 16.0% of revenues, in the third quarter of 2016, compared to $766 million, or 15.9% of revenues, in the third quarter of 2015. S&M expenses related to our generic medicines segment were $415 million, an increase of 41% compared to $295 million in the third quarter of 2015, or 51% in local currency terms. The increase was mainly due to additional costs related to the inclusion of two months of expenses of the Actavis generics business and the launch of our business venture in Japan in the second quarter of 2016. S&M expenses related to our specialty medicines segment were $458 million, an increase of 10% compared to $417 million in the third quarter of 2015. The increase was mainly due to higher investments in new launches in the third quarter of 2016 and lower S&M activities in the third quarter of 2015.

General and Administrative (G&A) expenses in the third quarter of 2016 amounted to $310 million, compared to $316 million in the third quarter of 2015. G&A expenses excluding equity compensation expenses were $304 million in the third quarter of 2016, or 5.5% of revenues, compared to $307 million and 6.4% in the third quarter of 2015.

In light of advanced discussions with the U.S. Department of Justice and the U.S. Securities and Exchange Commission to settle our previously-disclosed FCPA investigations, we are establishing a provision of approximately $520 million. The provision relates to conduct in three countries, Russia, Mexico and Ukraine, during the time period covering 2007-2013. None of the conduct in question involved Teva’s U.S. business.

Upon learning of FCPA concerns in 2012, Teva accelerated the pace of changes to address these issues by completely transforming its governance program and processes on every level. This resulted in actions including, terminating problematic business relationships with third parties, separating relevant employees from the company, fully overhauling the management of several subsidiaries, and ceasing operations in several countries. The company has also restructured through a new global organizational structure and chain of command that reduces risks.

The compliance program that Teva has in place now is serious, rigorous, and comprehensive and is designed to protect the company and its subsidiaries against future violations. Today, Teva has a culture of compliance that begins with a strong tone at the top — including executive regional and local management — and underpins every single business decision.

Quarterly GAAP operating income was $0.8 billion in the third quarter of 2016, down 24% compared to $1.0 billion in the third quarter of 2015. Quarterly non-GAAP operating income was $1.8 billion, up 16%, compared to $1.6 billion in the third quarter of 2015.

Adjusted EBITDA (non-GAAP operating income, which excludes amortization and certain other items, and excluding depreciation expenses) was $1.9 billion, up 16% compared to $1.7 billion in the third quarter of 2015.

GAAP financial expenses for the third quarter of 2016 were $150 million, compared to $697 million in the third quarter of 2015. Expenses in the third quarter of 2015 were mainly the result of a $623 million loss on our shares of Mylan, reflecting the price of Mylan’s shares as of September 30, 2015, while expenses in the current quarter were affected by the borrowings used to finance the acquisition of the Actavis generics business. Non-GAAP financial expenses were $151 million in the third quarter of 2016, compared to $65 million in the third quarter of 2015.

GAAP income tax expenses for the third quarter of 2016 were $207 million, or 34% on pre-tax income of $615 million. In the third quarter of 2015, the provision for income taxes was $193 million, or 62% on pre-tax income of $313 million. The provision for non-GAAP income taxes for the third quarter of 2016 was $261 million on pre-tax non-GAAP income of $1.6 billion, for a quarterly tax rate of 16%. The provision for non-GAAP income taxes in the third quarter of 2015 was $319 million on pre-tax non-GAAP income of $1.5 billion, for a quarterly tax rate of 21%.

We expect our annual non-GAAP tax rate for 2016 to be 18%, mainly due to synergies associated with the acquisition of the Actavis generics business and nonrecurring tax benefits in jurisdictions with higher tax rates.
GAAP net income attributable to Teva and GAAP diluted EPS were $412 million and $0.35, respectively, in the third quarter of 2016, compared to $103 million and $0.12, respectively, in the third quarter of 2015. Non-GAAP net income attributable to ordinary shareholders for calculating diluted EPS and non-GAAP diluted EPS were $1.4 billion and $1.31, respectively, in the third quarter of 2016, compared to $1.2 billion and $1.35 in the third quarter of 2015.

For the third quarter of 2016, the weighted average outstanding shares for the fully diluted earnings per share calculation was 984 million on a GAAP basis and 1,044 million on a non-GAAP basis. The number of average weighted diluted shares outstanding used for the fully diluted share calculation for the third quarter of 2015 was 862 million shares, on both a GAAP and non-GAAP basis. The increase in the number of shares resulted from our December 2015 equity offerings and from the issuance of shares to Allergan in August 2016 in connection with the closing of the Actavis acquisition. The number of shares on a non-GAAP basis includes the potential dilution resulting from our mandatory convertible preferred shares, which had a dilutive effect on our non-GAAP earnings per share.

As of September 30, 2016, the fully diluted share count for calculating Teva’s market capitalization was approximately 1,088 million shares.

Non-GAAP information: Net non-GAAP adjustments in the third quarter of 2016 were $952 million. Non-GAAP net income and non-GAAP EPS for the quarter were adjusted to exclude the following items:
Legal settlements and loss contingencies of $533 million, primarily a provision of approximately $520 million relating to the previously-mentioned FCPA investigations;
Amortization of purchased intangible assets totaling $429 million, of which $387 million is included in cost of goods sold and the remaining $42 million in selling and marketing expenses. This includes amortization expenses of $237 million related to Actavis’ intangible assets;
Acquisition and related expenses, including contingent consideration, of $371 million, including $250 million paid to Regeneron pursuant to our collaborative agreement to develop and commercialize its pain medication product fasinumab and a contingent consideration expense of $43 million related to Bendeka as well as expenses related to the Actavis generics acquisition;
Inventory step-up of $152 million, related mainly to the acquisition of the Actavis generics business;
Restructuring expenses of $115 million, related mainly to the acquisition of the Actavis generics business;
Costs related to regulatory actions taken in facilities of $46 million;
Equity compensation expense of $31 million;
Impairment of long-lived assets of $29 million;
Net gain from other non-GAAP items of $678 million, including a net gain of $693 million from the divestments of products in connection with the acquisition of the Actavis generics business;
Minority interest adjustment of negative $22 million; and
Corresponding tax benefit of $54 million.
Teva believes that excluding such items facilitates investors’ understanding of its business. See the attached tables for a reconciliation of the GAAP results to the adjusted non-GAAP figures.
Cash flow from operations generated during the third quarter of 2016 was $1.5 billion, an increase of 34% compared to the third quarter of 2015. The increase was mainly due to lower payments for legal settlements, partially offset by an increase in accounts receivable, net of SR&A, and an increase in inventories. Cash flow was affected by the inclusion of two months of the generic business of Actavis. Free cash flow, excluding net capital expenditures, was $1.2 billion, up 27% compared to the third quarter of 2015.
Total balance sheet assets were $98.7 billion as of September 30, 2016, compared to $57.9 billion as of June 30, 2016. The increase was mainly due to an increase of $19.7 billion of goodwill and an increase of other intangible assets of $20.3 billion, both related mainly to the Actavis acquisition.
Cash and investments at September 30, 2016 decreased to $2.7 billion, compared to $8.2 billion at June 30, 2016.
As of September 30, 2016, our debt was $36.9 billion, an increase of $26.0 billion compared to $10.9 billion as of June 30, 2016. The increase was mainly due to the $20.4 billion of debt issuances and the $5.0 billion term loans borrowed to finance the Actavis acquisition. The portion of total debt classified as short-term as of September 30, 2016 was 10%.
Total shareholders’ equity was $37.0 billion at September 30, 2016, compared to $32.0 billion at June 30, 2016.
Segment Results for the Third Quarter 2016
Generic Medicines Segment

Three Months Ended September 30,
2016 2015
U.S.$ in millions / % of Segment Revenues

Revenues $ 2,904 100.0% $ 2,202 100.0%
Gross profit 1,466 50.5% 1,005 45.6%
R&D expenses 184 6.3% 132 6.0%
S&M expenses 415 14.3% 295 13.4%
Segment profit* $ 867 29.9% $ 578 26.2%

* Segment profit consists of gross profit for the segment, less R&D and S&M expenses related to the segment. Segment profit does not include G&A expenses, amortization, inventory step-up and certain other items.
Generic Medicines Revenues
Generic medicines revenues in the third quarter of 2016 were $2.9 billion, an increase of 32% compared to the third quarter of 2015, reflecting the results of operations of the Actavis generics business from August 2, 2016. In local currency terms, revenues increased 35%.
Generic revenues consisted of:
U.S. revenues of $1.3 billion, an increase of 25% compared to the third quarter of 2015, mainly due to the inclusion the generic business of Actavis with revenues of $538 million.
European revenues of $829 million, an increase of 25%, or 31% in local currency terms, compared to the third quarter of 2015, mainly due to the inclusion the generic business of Actavis with revenues of $224 million.
ROW revenues of $782 million, an increase of 54%, or 60% in local currency terms, compared to the third quarter of 2015. The increase in local currency terms was mainly due to the results of our business venture with Takeda in Japan which commenced operations in April 2016 and $93 million in revenues from Actavis.
API sales to third parties of $191 million (which is included in the market revenues above), a decrease of 7%, compared to the third quarter of 2015, due to lower revenues in both Europe and the United States.
Generic medicines revenues comprised 52% of our total revenues in the quarter, compared to 46% in the third quarter of 2015.
Generic Medicines Gross Profit
Gross profit from our generic medicines segment in the third quarter of 2016 was $1.5 billion, an increase of 46% compared to the third quarter of 2015. The higher gross profit was mainly a result of the first time inclusion of the generic business of Actavis and our business venture with Takeda in Japan and higher gross profit of our API business as well as lower expenses related to production.
Gross profit margin for our generic medicines segment in the third quarter of 2016 increased to 50.5%, from 45.6% in the third quarter of 2015.
Generic Medicines Profit
Our generic medicines segment generated profit of $867 million in the third quarter of 2016, an increase of 50% compared to the third quarter of 2015. Generic medicines profitability as a percentage of generic medicines revenues was 29.9% in the third quarter of 2016, up from 26.2% in the third quarter of 2015.
Specialty Medicines Segment

Three Months Ended September 30,
2016 2015
U.S.$ in millions / % of Segment Revenues

Revenues $ 2,048 100.0% $ 2,178 100.0%
Gross profit 1,783 87.1% 1,859 85.4%
R&D expenses 228 11.1% 220 10.1%
S&M expenses 458 22.4% 417 19.1%
Segment profit* $ 1,097 53.6% $ 1,222 56.1%

* Segment profit consists of gross profit for the segment, less R&D and S&M expenses related to the segment. Segment profit does not include G&A expenses, amortization, inventory step-up and certain other items.
Specialty Medicines Revenues
Specialty medicines revenues in the third quarter of 2016 were $2.0 billion, a decrease of 6% compared to the third quarter of 2015. U.S. specialty medicines revenues were $1.6 billion, down 8% compared to the third quarter of 2015. European specialty medicines revenues were $406 million, an increase of 10%, or 12% in local currency terms, compared to the third quarter of 2015. ROW specialty revenues were $84 million, down 22%, or 20% in local currency terms, compared to the third quarter of 2015.
Specialty medicines revenues comprised 37% of our total revenues in the quarter, compared to 45% in the third quarter of 2015.
The decrease in specialty medicines revenues compared to the third quarter of 2015 was primarily due to lower revenues in all our core therapeutic areas.
The following table presents revenues by therapeutic area and key products for our specialty medicines segment for the three months ended September 30, 2016 and 2015:

Three Months Ended
September 30,
Percentage
Change
2016 2015 2016 – 2015
U.S. $ in millions
CNS $ 1,302 $ 1,366 (5%)
Copaxone 1,061 1,085 (2%)
Azilect 101 92 10%
Nuvigil 21 97 (78%)
Respiratory 270 285 (5%)
ProAir 118 149 (21%)
QVAR 96 92 4%
Oncology 269 326 (17%)
Treanda and Bendeka 149 207 (28%)
Women’s Health 109 115 (5%)
Other Specialty 98 86 14%
Total Specialty Medicines $ 2,048 $ 2,178 (6%)

Global revenues of Copaxone (20 mg/mL and 40 mg/mL), the leading multiple sclerosis therapy in the U.S. and globally, were $1.1 billion, a decrease of 2% compared to the third quarter of 2015.
Copaxone revenues in the United States, were $874 million, flat compared to the third quarter of 2015, as a price increase of 7.9% in January 2016 was offset by a decrease in volume for Copaxone 20 mg/mL. At the end of the third quarter of 2016, according to September 2016 IMS data, our U.S. market shares for the Copaxone products in terms of new and total prescriptions were 27.0% and 29.2%, respectively. Copaxone 40 mg/mL accounted for over 83% of total Copaxone prescriptions in the U.S.
Copaxone revenues outside the United States were $187 million, a decrease of 10%, or 8% in local currency terms, compared to the third quarter of 2015 mainly due to loss of tender orders in Russia, partially offset by an increase in volumes in Europe.
Our global Azilect revenues were $101 million, an increase of 10% compared to the third quarter of 2015. Global in-market sales decreased 22% due to generic competition in certain European markets.
Revenues of our respiratory products were $270 million, down 5% compared to the third quarter of 2015. ProAir revenues in the quarter were $118 million, down 21% compared to the third quarter of 2015, due to lower volumes related to changes in insurers’ preferred medicines lists. QVAR global revenues were $96 million in the third quarter of 2016, up 4% compared to the third quarter of 2015, mainly due to higher volumes sold.
Revenues of our oncology products were $269 million in the third quarter of 2016, down 17% compared to the third quarter of 2015. Revenues of Treanda and Bendeka were $149 million, down 28% compared to the third quarter of 2015, mainly due to lower volumes from normalization of channel inventory following the transition from Treanda to BendekaTM in the first half of 2016 and competition from other therapies.
Specialty Medicines Gross Profit
Gross profit from our specialty medicines segment was $1.8 billion, down $76 million compared to the third quarter of 2015. Gross profit margin for our specialty medicines segment in the third quarter of 2016 was 87.1%, compared to 85.4% in the third quarter of 2015.
Specialty Medicines Profit
Our specialty medicines segment profit was $1.1 billion in the third quarter of 2016, down 10% compared to the third quarter of 2015, due to lower gross profit as well as increases in S&M and R&D expenses.
Specialty medicines profit as a percentage of segment revenues was 53.6% in the third quarter of 2016, down from 56.1% in the third quarter of 2015.
The following tables present details of our multiple sclerosis franchise and of our other specialty medicines for the three months ended September 30, 2016 and 2015:

Multiple Sclerosis
Three months ended September 30,
2016 2015
U.S.$ in millions / % of MS Revenues

Revenues $ 1,061 100.0% $ 1,085 100.0%
Gross profit 982 92.6% 980 90.3%
R&D expenses 20 1.9% 16 1.5%
S&M expenses 76 7.2% 88 8.1%
MS profit $ 886 83.5% $ 876 80.7%

Other Specialty
Three months ended September 30,
2016 2015
U.S.$ in millions / % of Other Specialty Revenues

Revenues $ 987 100.0% $ 1,093 100.0%
Gross profit 801 81.2% 879 80.4%
R&D expenses 208 21.1% 204 18.7%
S&M expenses 382 38.7% 329 30.1%
Other Specialty profit $ 211 21.4% $ 346 31.7%

Other Activities
Our OTC revenues related to PGT were $356 million, an increase of 40% compared to $255 million in the third quarter of 2015. In local currency terms, revenues increased 83%, mainly due to inflation in Venezuela. PGT’s in-market sales were $496 million in the third quarter of 2016, an increase of $115 million compared to the third quarter of 2015.
Other revenues were $255 million in the third quarter of 2016, mostly from the distribution of third-party products in Israel and Hungary, as well as from the contract manufacturing of products which were required to be divested in connection with the acquisition of Actavis, compared to revenues of $188 million in the third quarter of 2015. The increase was mainly due to revenues from contract manufacturing services of $32 million, as noted above, as well as to higher revenues from distribution in Israel.
Financial Outlook
We expect revenues for full year 2016 to be $21.6-$21.9 billion; we expect revenues for the fourth quarter of year 2016 to be $6.2-$6.5.
Non-GAAP EPS for 2016 is expected to be $5.10-$5.20, based on a weighted average number of shares of 1,020 million; non-GAAP EPS for the fourth quarter of 2016 is expected to be $1.34-$1.44, based on a weighted average number of shares of 1,077 million.
Cash flow from operating activities for 2016 is expected to be $4.8-$5.0 billion; cash flow from operating activities for the fourth quarter of 2016 is expected to be $1.0-$1.2 billion.
These estimates reflect management`s current expectations for Teva’s performance in 2016. Actual results may vary, whether as a result of exchange rate differences, market conditions or other factors. In addition, the non-GAAP figures exclude the amortization of purchased intangible assets, costs related to certain regulatory actions, inventory step-up, legal settlements and reserves, impairments and related tax effects.
Dividends
On November 14, 2016, the Board of Directors declared a cash dividend of $0.34 per ordinary share for the third quarter of 2016. For holders of our ordinary shares that are traded on the Tel Aviv Stock Exchange, the dividend will be converted into new Israeli shekels based on the official exchange rate as of November 15, 2016. The record date will be December 5, 2016, and the payment date will be December 20, 2016. Tax will be withheld at a rate of 15%.
On November 14, 2016, the Board of Directors also declared a cash dividend of $17.50 per Mandatory Convertible Preferred Share for the third quarter of 2016. The record date will be December 1, 2016, and the payment date will be December 15, 2016. Tax will be withheld at a rate of 15%.

On November 15, 2016 Juniper Pharmaceuticals, Inc. (Nasdaq: JNP) ("Juniper" or the "Company"), a women’s health therapeutics company, reported financial results for the three- and nine- month periods ended September 30, 2016 (Press release, Juniper Pharmaceuticals, NOV 15, 2016, View Source;p=RssLanding&cat=news&id=2222420 [SID1234516627]). Recent highlights include:

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OneCrinone 90 mg (progesterone) launched in Japan by Merck KGaA, Darmstadt, Germany ("Merck KGaA");
Completed pilot study for JNP-0101 intravaginal ring ("IVR") demonstrating delivery of oxybutynin in an animal model;
Discontinued development of COL-1077 lidocaine vaginal gel following Phase 2b results;
Revenue increased to $11.6 million for the third quarter of 2016 and $33.6 million for the first nine months of 2016, up 5% and 13%, respectively, versus the prior year periods;
Service revenues increased for the seventh consecutive quarter on a local currency basis;
Cash and equivalents of $15.0 million at September 30, 2016; and,
Monetized U.S. Crinone (progesterone gel) royalty stream with Allergan, Inc., providing $11 million of non-dilutive cash to Juniper in November 2016.

Juniper Pharmaceuticals, Inc.
"Ongoing strong quarterly revenue growth provides continued cash flow which, coupled with the $11 million from Allergan, enables targeted investments in product development while also supporting our solid cash position," said Alicia Secor, Juniper’s President and CEO.

"We continue to advance our IVR pipeline, targeting unmet and underserved needs in women’s health including overactive bladder, HRT and preterm birth," Ms. Secor continued. "We are selectively evaluating acquisition and in-licensing opportunities with the goal of bringing in one or more women’s health therapeutics to enhance our product portfolio and establish a new trajectory to support our mission of building a leading women’s health company."

Juniper’s current 505(b)(2) product candidates are: JNP-0101, an oxybutynin IVR for the treatment of overactive bladder in women; JNP-0201, a combination estrogen + progesterone IVR for menopausal symptoms; and, JNP-0301, a progesterone IVR for the prevention of preterm birth in women with a short cervical length at mid-pregnancy.

Third Quarter Financial Results

Third quarter total revenues increased 5% to $11.6 million, compared with $11.0 million for the quarter ended September 30, 2015.

Product revenues were $7.1 million, an increase of $0.3 million, or 5%, versus the third quarter of last year, driven by continued in-market growth and new market sales of Crinone by Merck KGaA.

Service revenues were $3.3 million, a $0.1 million, or 4%, increase versus the third quarter of last year. While we experienced continued strong revenue growth in the local UK currency, the weak pound versus the U.S. dollar continues to dampen translated revenue. On a local currency basis, third quarter service revenues increased 22% year-over-year.

Royalty revenues, based on Allergan’s sales of Crinone in the U.S., increased by $0.1 million to $1.2 million.

Gross profit increased to $5.9 million as compared with $4.4 million in the prior year quarter.

Total operating expenses were $5.7 million in the third quarter of 2016. The $1.5 million increase as compared to the prior year quarter was driven by a $0.7 million increase in R&D spending and a $0.9 million increase in general and administrative costs.

Third quarter R&D expense was driven by costs associated with the now-concluded Phase 2 clinical trial of COL-1077. The increase in general and administrative costs was primarily driven by costs associated with organizational growth.

Juniper recorded net income of $0.2 million, or $0.02 per diluted share, in the third quarter of 2016, compared to net income of $0.4 million, or $0.03 per diluted share, in the same period of 2015.

Nine Months Financial Results

For the nine months ended September 30, 2016, total revenues increased 13% to $33.6 million, compared with $29.7 million for the nine months ended September 30, 2015.

Product revenues were $20.7 million, an increase of $2.3 million, or 13%, versus the same period last year. Service revenues were $10.0 million, up $1.6 million, or 19%, versus the same period last year. On a local currency basis, service revenues in the first nine months of 2016 increased 31% year-over-year. Royalty revenues increased by $0.1 million to $3.0 million.

Gross profit increased to $15.1 million as compared with $12.7 million in the same period last year.

Total operating expenses were $19.0 million in the nine months ended September 30, 2016. The $5.5 million increase as compared to the prior year period was driven by a $3.1 million increase in R&D spending and a $2.5 million increase in general and administrative costs.

Juniper recorded a net loss of $3.7 million, or ($0.34) per diluted share, in the nine months ended September 30, 2016, compared to a net loss of $0.5 million, or ($0.05) per diluted share, in the same period of 2015.

Liquidity

Cash and cash equivalents increased to $15.0 million as of September 30, 2016, versus $13.0 million at June 30, 2016 and $13.9 million at December 31, 2015.

On November 15, 2016, the Company announced the monetization of U.S. Crinone royalty stream with Allergan, Inc. Juniper will record the $11 million payment and royalties for the month of October as royalty income in the fourth quarter of 2016.

Restatement

Financial results for prior periods discussed above are based on the Company’s restated financial results as filed on Forms 10-K/A and 10-Q/A filed on November 14, 2016 with the SEC.

Under the revised methodology, product revenue is recognized upon shipment to Merck KGaA at the minimum price (our direct manufacturing cost plus 20%). Amounts invoiced above the minimum price for countries where we are entitled to a percentage of Merck KGaA’s net revenue are recorded as deferred revenue. Upon receiving sell-through information from Merck KGaA, revenue is recorded to reflect the percentage of Merck KGaA’s net selling price for specific countries.