On May 8, 2018 Loxo Oncology, Inc. (Nasdaq:LOXO), a biopharmaceutical company innovating the development of highly selective medicines for patients with genetically defined cancers, reported first quarter 2018 financial results (Press release, Loxo Oncology, MAY 8, 2018, View Source [SID1234526204]).
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"In the first quarter, we delivered against all of our planned corporate goals. We completed the rolling NDA submission for larotrectinib, enrolled well on the LOXO-292 Phase 1 trial and moved LOXO-305 toward a clinical start in the second half of 2018. We also entered into an important collaboration with Illumina to develop a companion diagnostic test for larotrectinib and LOXO-292," said Josh Bilenker, M.D., chief executive officer of Loxo Oncology. "We look forward to providing a comprehensive update on the Phase 1 study of LOXO-292 at ASCO (Free ASCO Whitepaper) on June 2nd."
Recent Highlights
Companion Diagnostic (CDx) Partnership
Global Development and Commercialization Partnership with Illumina: On April 10, 2018, Loxo Oncology announced a global strategic partnership with Illumina to develop and commercialize a CDx version of Illumina’s TruSight Tumor 170 for NTRK fusions and RET fusions/mutations as a Class III FDA-approved companion diagnostic in conjunction with larotrectinib and LOXO-292, respectively. The companies are also planning to broaden the clinical utility of the full panel by seeking approval for the rest of the assay content as a Class II cancer genomic profiling test. More information can be found here.
Larotrectinib
Completion of New Drug Application (NDA) Rolling Submission to FDA: On March 26, 2018, Loxo Oncology completed the rolling submission of an NDA to the U.S. Food and Drug Administration (FDA) for larotrectinib for the treatment of adult and pediatric patients with locally advanced or metastatic solid tumors harboring an NTRK gene fusion. More information can be found here.
The Lancet Oncology Publication: On March 29, 2018, The Lancet Oncology published results for larotrectinib in the treatment of pediatric patients with TRK fusion cancer. The publication included results from the ongoing pediatric Phase 1/2 trial. In this trial, larotrectinib induced an objective response rate (ORR) of 93 percent in pediatric patients with TRK fusion-positive solid tumors. The publication can be found here.
LOXO-292
Annals of Oncology Publication: On April 18, 2018, the Annals of Oncology published a manuscript illustrating the preclinical profile of LOXO-292, preclinical work supporting LOXO-292’s selective inhibition of RET, and continued evidence of clinical proof-of-concept. The publication included two patient cases who both presented with RET-altered, multikinase (MKI) inhibitor-resistant cancers. One patient harbored RET M918T-mutant medullary thyroid cancer with an acquired RET V804M gatekeeper resistance mutation, and the other patient harbored KIF5B-RET fusion-positive non-small cell lung cancer with brain metastases. The latter case was previously reported on in October 2017 in a presentation at the International Association for the Study of Lung Cancer 18th World Conference on Lung Cancer. Due to clinical urgency, both were treated with LOXO-292 on intra-patient dose escalation single patient protocols. Both patients achieved RECIST confirmed partial responses. This represents the first clinical report of the predicted RET V804M gatekeeper mutation arising in a patient previously treated with MKIs, and the first successful treatment of a patient in that setting. In this two-patient dataset, LOXO-292 was well-tolerated with no adverse events attributed to LOXO-292. The publication can be found here.
LOXO-292 Oral Presentation Accepted at the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) Annual Meeting: On April 4, 2018, Loxo Oncology announced that LOXO-292 interim clinical data from the ongoing Phase 1 clinical trial will be presented in an oral presentation at the ASCO (Free ASCO Whitepaper) Annual Meeting held June 1 – 5, 2018 in Chicago, Illinois. The presentation is entitled "A Phase 1 Study of LOXO-292, A Potent and Highly Selective RET Inhibitor, in Patients with RET-Altered Cancers." Loxo Oncology will host a conference call and live webcast on Saturday, June 2, 2018 at 4:00 p.m. CT to discuss the clinical data after they are presented at ASCO (Free ASCO Whitepaper). Information on how to access the call and webcast can be found below.
Upcoming Milestones
Larotrectinib (TRK)
FDA is expected to accept the filing of the New Drug Application in the first half of 2018
Marketing Authorisation Application submission by Bayer in the European Union is expected in 2018
Presentation of updated TRK fusion clinical data is expected in the second half of 2018
LOXO-195 (next-generation TRK)
Presentation of updated clinical data is expected in the second half of 2018
LOXO-292 (RET)
Presentation of updated clinical data at the ASCO (Free ASCO Whitepaper) Annual Meeting
LOXO-305 (BTK)
Initiation of a Phase 1 clinical trial is expected in the second half of 2018
First Quarter 2018 Financial Results
As of March 31, 2018, Loxo Oncology had aggregate cash, cash equivalents and investments of $735.6 million, compared to $626.2 million as of December 31, 2017. Loxo Oncology received the remaining $150 million of the $400 million upfront payment related to the Bayer collaboration in the first quarter of 2018.
Revenue from the collaboration agreement was $38.4 million for the first quarter of 2018, compared to none for the first quarter of 2017. This represents $42.9 million in revenue recognized from the $400 million upfront payment from the Bayer collaboration offset by $4.4 million, Loxo Oncology’s share of the joint larotrectinib co-promotion costs. Loxo Oncology recognizes revenue from the upfront payment on a proportional performance basis utilizing a calculation based on quarterly research and development spending associated with larotrectinib and LOXO-195, relative to cumulative and forecasted research and development spending on larotrectinib and LOXO-195 over the course of the collaboration agreement. As a result, the quarterly revenue recognized for the upfront payment varies from quarter to quarter. A supporting schedule that shows the different components of revenue from the collaboration agreement is included with the attached financial statements.
Research and development expenses were $32.0 million for the first quarter of 2018 compared to $20.2 million for the first quarter of 2017. This increase was primarily due to expanded larotrectinib development activities including clinical costs, as well as additional development expenses related to our other programs, and higher employment costs primarily due to increased headcount. These numbers are net of 50/50 cost-sharing with Bayer for larotrectinib and LOXO-195 development costs. Loxo Oncology recognized research and development-related stock-based compensation expense of $4.3 million during the first quarter of 2018 as compared to $2.4 million for the first quarter of 2017.
General and administrative expenses were $12.2 million for the first quarter of 2018 compared to $4.8 million for the first quarter of 2017. The increase was primarily due to additional headcount and associated employment costs and general and administrative professional fees. Loxo Oncology recognized general and administrative-related stock-based compensation expense of $5.4 million during the first quarter 2018 compared to $1.6 million for the first quarter of 2017.
Net loss was $3.6 million for the first quarter of 2018, compared to $24.5 million for the first quarter of 2017. This decrease in net loss is primarily driven by the revenue recognized from the $400.0 million upfront payment from the Bayer collaboration, the larotrectinib and LOXO-195 development reimbursement from the Bayer collaboration, offset by increases in operating expenses.
Non-GAAP net loss was $36.8 million for the first quarter of 2018, compared to $20.6 million for the first quarter of 2017. This non-GAAP net loss measure, more fully described below under "Non-GAAP Financial Measures," excludes the recognition of collaboration revenue related to the Bayer upfront payment and share-based compensation expenses. A reconciliation of the GAAP financial results to non-GAAP financial results is included with the attached financial statements.
Earnings Conference Call Information
Loxo Oncology will host a conference call today at 8:00 a.m. ET to discuss the first quarter 2018 financial results and company updates. To participate in the conference call, please dial (877) 930-8065 (domestic) or (253) 336-8041 (international) and refer to conference ID 1979239. A replay will be available shortly after the conclusion of the call and archived on the company’s website for 30 days following the call.
ASCO Conference Call and Webcast Information
Loxo Oncology will be hosting a conference call and live webcast with slides and Q&A on Saturday, June 2, 2018 at 4:00 p.m. CT to discuss the interim LOXO-292 clinical data after they are presented at ASCO (Free ASCO Whitepaper). To participate in the conference call, please dial (877) 930-8065 (domestic) or (253) 336-8041 (international) and refer to conference ID 3597058. A live webcast of the presentation will be available at View Source A replay will be available shortly after the conclusion of the call and archived on the company’s website for 30 days following the call.