On May 2, 2017 Myriad Genetics, Inc. (NASDAQ:MYGN), a global leader in molecular diagnostics and personalized medicine, reported financial results for its fiscal third-quarter 2017, provided an update on recent business highlights and updated its fiscal year 2017 financial guidance (Press release, Myriad Genetics, MAY 2, 2017, View Source [SID1234518811]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We were very encouraged to see sequential growth in hereditary cancer testing volumes for the second consecutive quarter," said Mark C. Capone, president and CEO, Myriad Genetics. "Coupled with meaningful sequential volume growth in all of our major pipeline tests including GeneSight, Vectra DA, Prolaris, and EndoPredict, we believe we are rapidly approaching an important inflection in our business where our new products will drive accelerated revenue growth and profitability."

Financial Highlights

The following table summarizes the financial results and product revenue for our fiscal third-quarter 2017:
Revenue
Fiscal Third-Quarter
($ in millions) 2017 2016 %
Change
Molecular diagnostic testing revenue

Hereditary cancer testing revenue $ 140.8 $ 156.3 (10 %)

GeneSight testing revenue 23.9 NA NM

Vectra DA testing revenue 11.2 12.3 (9 %)

Prolaris testing revenue 3.4 5.2* (35 %)

EndoPredict testing revenue 2.3 1.1 109 %

Other testing revenue 3.6 2.5 44 %

Total molecular diagnostic testing revenue 185.2 177.4 4 %

Pharmaceutical and clinical service revenue 11.7 13.1 (11 %)

Total Revenue $ 196.9 $ 190.5 3 %

Income Statement
Fiscal Third-Quarter
($ in millions) 2017 2016 %
Change
Total Revenue $ 196.9 $ 190.5 3 %

Gross Profit 152.6 150.3 2 %
Gross Margin 77.5 % 78.9 %

Operating Expenses 139.7 107.7 30 %

Operating Income 12.9 42.6 (70 %)
Operating Margin 6.6 % 22.4 %

Adjusted Operating Income 24.0 45.8 (48 %)
Adjusted Operating Margin 12.2 % 24.0 %

Net Income 4.2 34.5 (88 %)

Diluted EPS 0.06 0.47 (87 %)

Adjusted EPS $ 0.27 $ 0.41 (34 %)
* Included Medicare retrospective payments
Business Highlights

• myRisk Hereditary Cancer

Hereditary cancer volumes grew on a sequential basis for the second consecutive quarter.
A publication in The Oncologist by researchers at Northwestern University compared 4,250 variants from ClinVar to those from Myriad Genetics. In the study, only 73 percent of the classifications in ClinVar were consistent with Myriad classifications with 27 percent discordant. In addition, it was shown that Myriad could definitely classify up to 60 percent of the variants of uncertain significance from other laboratories.

• GeneSight

Volume grew 44 percent year-over-year to more than 60,000 tests performed in the fiscal third-quarter.
Completed enrollment ahead of schedule in a 1,200 patient clinical utility study evaluating GeneSight in patients with treatment resistant depression. The company anticipates top line data by the end of calendar year 2017.
Published data in Clinical Therapeutics which evaluated 2,168 patients whose treatment was either congruent or non-congruent with the GeneSight test result which demonstrated health savings of $3,998 for primary care physicians and $1,308 for patients treated by psychiatrists after paying for the cost of the test.
Completed a payer demonstration project using the Optum healthcare informatics platform from United Health that demonstrated substantial cost savings associated with the use of GeneSight. Initiated similar demonstration projects with Humana and HealthCore, a subsidiary of Anthem Blue Cross Blue Shield.
Launched a highly successful pilot sales program for GeneSight in the preventive care market with the average sales territory already generating a 300 sample annual run rate.

• Vectra DA

Volumes increased five percent sequentially with approximately 38,500 tests performed.
Creaky Joints, a leading advocacy group for arthritis patients added Vectra DA to its professional guidelines. This builds upon the recent addition of Vectra DA to the United Rheumatology guidelines, a physician guideline body comprising approximately 10 percent of practicing rheumatologists.

• Prolaris

Volumes grew 17 percent year-over-year and nine percent sequentially with approximately 5,100 tests ordered in the third quarter.
The comment period ended on a draft local coverage determination from Palmetto GBA for favorable-intermediate patients, a new indication that would represent a market expansion of approximately 30,000 patients per year in the United States. Prolaris is the only test to receive proposed Medicare coverage in this patient population.
At the upcoming American Urology Association meeting, Myriad will be presenting a 767 patient study that demonstrated the ability of Prolaris to predict metastases from biopsy samples with a high degree of statistical significance.

• EndoPredict

Revenues grew 109 percent year-over-year to $2.3 million in the fiscal third-quarter.
Launched EndoPredict in the United States at the end of the fiscal third-quarter.
In aggregate, Myriad has now received positive coverage decisions from payers in the United States representing 83 million lives.

• myPath Melanoma

Myriad’s third clinical validation study, which demonstrated myPath Melanoma was able to differentiate melanoma from benign nevi with 95 percent diagnostic accuracy, was published in Cancer Epidemiology.
Myriad has submitted its reimbursement dossier for myPath Melanoma to Medicare and private payers.

• Companion Diagnostics

AstraZeneca announced that olaparib met its primary endpoint in BRCA positive, HER2- metastatic breast cancer in the OlympiAD study, demonstrating a statistically significant benefit in progression free survival. This represents a potential 60,000 patient per year market for BRACAnalysis CDx as a companion diagnostic.
Myriad signed a research collaboration with BeiGene which is a global pharmaceutical company developing the PARP inhibitor BGB-290 in the United States.
Signed a commercial collaboration with Clovis Oncology to perform BRACAnalysis CDx testing. Myriad is now performing companion diagnostic testing for every major company developing a PARP inhibitor.
Submitted our regulatory filing in Japan for BRACAnalysis CDx as the companion diagnostic for Lynparza in conjunction with our collaboration with AstraZeneca.

• International

International revenue grew 41 percent year-over-year and comprised five percent of total revenue in the fiscal third-quarter.
International EndoPredict revenue grew 109 percent year-over-year, largely as a result of recent French and German reimbursement.
Fiscal Year 2017 and Fiscal Fourth-Quarter 2017 Financial Guidance
Below is a table summarizing Myriad’s updated fiscal year 2017 and fiscal fourth-quarter 2017 financial guidance:

Revenue GAAP Diluted
Earnings Per
Share Adjusted
Earnings Per
Share
Fiscal Year 2017 $763-$765
million $0.23-$0.25 $1.01-$1.03

Fiscal Fourth-Quarter 2017 $192-$194
million $0.11-$0.13 $0.26-$0.28
These projections are forward-looking statements and are subject to the risks summarized in the safe harbor statement at the end of this press release. The Company will provide further details on its business outlook during the conference call today to discuss the fiscal third-quarter financial results, fiscal year 2017, and fiscal fourth-quarter 2017 financial guidance.

On May 3, 2017 MorphoSys AG Reported Solid First Quarter 2017 (Press release, MorphoSys, MAY 2, 2017, View Source [SID1234518809]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Advancing number of programs in clinical trials reflects operational progress and maturing pipeline

Conference call and webcast (in English) at 3:00pm CEST (2:00pm BST/9:00am EDT)

MorphoSys AG (FSE: MOR; Prime Standard Segment, TecDAX; OTC: MPSYY), a leader in the field of therapeutic antibodies, today reported results for the first quarter of 2017.

"We have seen significant progress both with our own and our partners’ drug candidates in the first quarter of 2017. This was particularly evidenced by our partner Roche’s decision to start a new pivotal phase 3 program with the antibody gantenerumab in Alzheimer’s disease," said Dr. Simon Moroney, Chief Executive Officer of MorphoSys AG. "We expect 2017 to be a year rich in clinical read-outs from our pipeline, with key data from several phase 2 studies pending. We are optimistic about the market approval of guselkumab, an antibody against psoriasis being developed by our partner Janssen, which is under FDA review for approval with a decision expected in the second half of this year."

"If approved, guselkumab could start to contribute to our earnings in the form of royalties on product sales most likely starting early 2018," commented Jens Holstein, Chief Financial Officer of MorphoSys AG. "With our strong cash position, we will continue to drive forward our proprietary portfolio of innovative biopharmaceuticals for the treatment of serious diseases, in particular starting a phase 3 trial with our blood cancer candidate MOR208 this year. In addition, we expect that our maturing partnered portfolio will produce increasing cash inflows from royalties in the years to come."

Financial Review for Q1 2017 (IFRS)

In Q1 2017 MorphoSys continued to focus on the research and development of drug candidates both for its own account as well as with its partners. Group revenues amounted to EUR 11.8 million, in line with the level of the first quarter of 2016 (EUR 12.1 million).

In the Proprietary Development segment, MorphoSys focuses on the research and clinical development of its own drug candidates in the fields of cancer and inflammation. In Q1 2017, this segment recorded revenues of EUR 0.2 million (Q1 2016: EUR 0.1 million).

In the Partnered Discovery segment, MorphoSys applies its proprietary technology to discover new antibodies for pharmaceutical companies, benefiting from the partners’ development progress through success-based milestone payments and royalties. In Q1 2017, revenues in this segment reached EUR 11.6 million (Q1 2016: EUR 12.0 million).

Earnings before interest and taxes (EBIT) in Q1 2017 stood at EUR -14.9 million (Q1 2016: EUR – 9.7 million). As expected, the operational loss reflects increased activities in the clinical development of the Company’s proprietary drug candidates, in particular three phase 2 studies started with MOR208 in blood cancer indications after the end of Q1 2016. Accordingly, the Proprietary Development segment reported an EBIT of EUR -18.9 million after being EUR -14.3 million in Q1 2016. EBIT in the Partnered Discovery segment was EUR 7.3 million (Q1 2016: EUR 7.7 million).

In Q1 2017, the consolidated net result amounted to EUR -15.0 million (Q1 2016: EUR -7.2 million). The diluted net result per share for Q1 2017 was EUR -0.52 (Q1 2016: EUR -0.28).

At the end of Q1 2017, the Company had a cash position of EUR 349.9 million compared to EUR 359.5 million on December 31, 2016. On the balance sheet, this cash position is reported under the items: cash and cash equivalents; available-for-sale financial assets; bonds, available-for-sale; and current and non-current financial assets classified as loans & receivables.

The number of shares issued totaled 29,159,770 at the end of Q1 2017 (year-end 2016: 29,159,770).

Financial Guidance and operational outlook for 2017

For the financial year 2017, MorphoSys continues to expect Group revenues in the range of EUR 46 to 51 million. R&D expenses for proprietary drug development are confirmed to be in a corridor of EUR 85 to 95 million. The Company confirmed its guidance for earnings before interest and taxes (EBIT) of EUR -75 to -85 million. This guidance does not include any additional revenue from potential future collaborations and/or licensing partnerships nor effects from potential in-licensing or co-development deals for new development candidates.

In the Proprietary Development segment, MorphoSys expects the following events in 2017:

– MOR208: Completion of the phase 2 safety run-in of the B-MIND clinical trial and initiation of the pivotal phase 3 part of the study, in which MOR208 will be tested in combination with bendamustine in comparison to rituximab and bendamustine in DLBCL.

– MOR208: Presentation of first data from the phase 2 trial of MOR208 in combination with lenalidomide in DLBCL (L-MIND study).

– MOR208: Initiation of the second study arm of the ongoing phase 2 COSMOS trial with MOR208 in CLL in order to test MOR208 with venetoclax. Currently, the Company is investigating the combination of MOR208 and idelalisib in this study.

– MOR202: Completion of the phase 1/2a dose-escalation trial in multiple myeloma, including MOR202 in combinations with pomalidomide and with lenalidomide.

– MOR209/ES414: Continuation of the phase 1 trial of MOR209/ES414 with an adapted dose regimen in prostate cancer (mCRPC) as part of the collaboration with Aptevo.

– MOR106: Completion of the phase 1 trial of MOR106, co-developed with Galapagos, in atopic dermatitis.

– MOR107: Completion of a phase 1 study in healthy volunteers.

– MOR103/GSK3196165: MorphoSys expects data from a phase 2b study in rheumatoid arthritis and from a phase 2a study in hand osteoarthritis, both conducted by GSK. This HuCAL antibody originated in the Company’s Proprietary Development segment, and has been fully out-licensed to GSK.

In its Partnered Discovery segment, MorphoSys expects the following events in 2017:

– Guselkumab: the first partner-developed therapeutic antibody based on MorphoSys’s HuCAL technology could receive market approval in 2017. MorphoSys expects the US regulatory authority FDA to make a decision in the second half of 2017 on Janssen’s application for the approval of guselkumab to treat adults with moderate to severe psoriasis. In addition, a regulatory filing for guselkumab in Europe has been submitted.

– Anetumab ravtansine, a HuCAL antibody drug conjugate being developed by Bayer, is expected to report results in 2017 from a pivotal phase 2 trial in the cancer indication mesothelioma. Favorable results could support a regulatory filing of the compound.

– Novartis collaboration: As previously communicated and as reflected in the Company’s 2017 guidance, the collaboration with Novartis will conclude at the end of November 2017 in accordance with the contract.

– For the remaining year, results may be disclosed from up to 27 different clinical studies in various phases conducted by partners with antibodies based on MorphoSys technology.

As always, MorphoSys is in discussions with other companies in the pharmaceutical industry about technology and/or product-based collaborations, with the goal of strengthening its participation in drug programs aimed at unmet medical needs.

MorphoSys Group Key Figures (IFRS, end of reporting period: March 31)

in EUR million Q1/2017 Q1/2016 Change
Revenues 11.8 12.1 -2%
Operating expenses 26.9 21.9 +23%
R&D expenses 23.3 18.6 +25%
Proprietary R&D expenses 19.2 14.6 +32%
G&A expenses 3.6 3.2 +13%
Operational loss (EBIT) -14.9 -9.7 +54%
Net loss (Net result) -15.0 -7.2 >100%
Net loss per share (diluted, in EUR) -0.52 -0.28 +86%
Cash position (end of period) 349.9 287.0 +22%
Equity ratio (end of period) (in %) 0.88 0.90 -2 PP*
No. of R&D programs (end of period) 114*** 104 +10%
No. of clinical programs (end of period) 30*** 26 +15%
No. of proprietary clinical programs (end of period) 6** 4** +50%
* Percentage points
** Thereof one proprietary program fully outlicensed to GSK (MOR103/GSK3196165)
*** Shortly after the end of the first quarter of 2017, MorphoSys has been informed that one program in the partnered discovery pipeline (tarextumab) was discontinued.

MorphoSys will hold its conference call and webcast today to present the first quarter 2017 financial results and the further outlook for 2017.

Dial-in number for the analyst conference call (in English) at 3:00 pm CEST; 2:00 pm BST; 9:00 am EDT (listen-only):
Germany: +49 (0) 89 2444 32975
For UK residents: +44 (0) 20 3003 2666
For US residents: +1 202 204 1514

Please dial in 10 minutes before the beginning of the conference.
A live webcast and slides will be made available at View Source
Approximately two hours after the press conference, a slide-synchronized audio replay of the conference and a transcript will be available on View Source

The interim statement for the first quarter of 2017 (IFRS) is available online:
View Source

On May 2, 2017 Selecta Biosciences, Inc. (NASDAQ:SELB), a clinical-stage biopharmaceutical company focused on unlocking the full potential of biologic therapies by avoiding unwanted immune responses, reported that it has licensed LMB-100, a next-generation immunotoxin, from the Center for Cancer Research (CCR) at the NCI, part of the National Institutes of Health. LMB-100 contains a potent bacterial toxin that binds to mesothelin, a protein expressed in all mesotheliomas, pancreatic adenocarcinomas and a high percentage of other malignancies, including lung, breast and ovarian cancers.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"This marks yet another major milestone for Selecta as we execute on our strategy to enable a range of proprietary, non-immunogenic biologic therapies using our proprietary immune tolerance platform," said Werner Cautreels, Ph.D., President, CEO and Chairman of Selecta. "By in-licensing this promising clinical-stage product candidate, we are extending our footprint to include oncology, where the efficacy of many biologic treatments is hampered by immunogenicity. Based on our preclinical work with NCI, we believe a combination treatment of LMB-100 and our proprietary SVP-Rapamycin may allow patients with rare, serious and aggressive forms of cancer to tolerate and benefit from multiple immunotoxin treatment cycles."

CCR is in the process of completing two clinical trials of LMB-100 in patients with mesothelioma and pancreatic cancer that are intended, in part, to help define the maximum tolerated dose. For more information about these trials, call 1-800-4-Cancer (1-800-422-6237) (TTY: 1-800-332-8615) and/or visit View Source Initial data indicate that undesired antibody responses to the immunotoxin prevented most patients from receiving the intended four treatment cycles. While a precursor to LMB-100 was similarly restricted by immunogenicity despite the concurrent use of potent immunosuppressive drugs, tumor regression was observed in the only two patients who were able to receive more than two cycles of treatment. These results suggest that the mitigation of immunogenicity may enable more patients to benefit from LMB-100 therapy.

In 2016, preclinical research under a Cooperative Research and Development Agreement between Selecta and NCI demonstrated that the co-administration of SVP-Rapamycin and LMB-100 has the potential to enable extended treatment with LMB-100 and, therefore, enhance its anti-tumor activity. Selecta’s immune tolerance Synthetic Vaccine Particles (SVP) prevented the formation of anti-LMB-100 antibodies, allowing for the administration of repeat treatment cycles in mouse models and enabling the full beneficial effect of LMB-100 on tumors in a tumor model. Selecta and NCI are currently in discussions regarding a planned Phase 1b clinical trial to evaluate multiple cycles of this combination treatment.

Under the terms of the license agreement, NCI will receive an upfront payment of $50,000 from Selecta. NCI also is entitled to up to $9.25 million in payments for milestones and low single-digit royalties on worldwide annual net sales of any resulting commercialized treatment.

About Pancreatic Cancer and Mesothelioma

Pancreatic cancer is among the most commonly diagnosed cancers and it is one of the few that is increasing in incidence and mortality. This type of cancer virtually always expresses mesothelin and has been linked to smoking, obesity and diabetes. For the year 2016, the National Cancer Institute (NCI) estimates that more than 53,000 new U.S. cases of pancreatic cancer were reported and that there were nearly 42,000 deaths in the U.S. from this disease. The prognosis for pancreatic cancer is poor, with approximately five percent of patients surviving five or more years following diagnosis.

Mesothelioma is a mesothelin-expressing cancer predominantly affecting the layer of tissue lining the lungs and chest wall. This type of cancer has been linked to asbestos exposure. According to the American Cancer Society, approximately 3,000 people are diagnosed with this disease each year in the United States. The prognosis for mesothelioma is poor, with an average life expectancy of 12-18 months following diagnosis.

On May 2, 2017 Altor BioScience Corporation (Altor), a leading developer of novel cytokine-based immunotherapeutics for cancer and infectious diseases, reported that it has received Fast Track designation from the U.S. Food and Drug Administration (FDA) for its investigational interleukin-15 (IL-15) agonist complex, ALT-803, in combination with bacillus Calmette-Guérin (BCG), for the treatment of patients with non-muscle invasive bladder cancer (NMIBC) (Press release, Altor BioScience, MAY 2, 2017, View Source [SID1234518799]). The FDA’s Fast Track program is designed to expedite the development and review of drugs to treat serious conditions and fill unmet medical needs.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

ALT-803 is currently being evaluated in a Phase Ib/II clinical trial to investigate the safety and efficacy of intravesical ALT-803 in combination with BCG in adult patients with BCG-naïve NMIBC as well as a separate Phase II clinical trial to investigate the safety and efficacy of intravesical ALT-803 in combination with BCG in adult patients with BCG-unresponsive NMIBC. Results from the recently completed Phase Ib NMIBC study will be presented at the American Urological Association Annual Meeting in Boston on May 12, 2017. The FDA Fast Track designation will apply to clinical development of ALT-803 in combination with BCG for the treatment and prophylaxis of carcinoma in situ (CIS) of the urinary bladder, as well as for the prophylaxis of primary or recurrent stage Ta and/or T1 papillary tumors following transurethral resection (TUR) in patients with NMIBC.

Hing C. Wong, Ph.D., Chief Executive Officer of Altor BioScience, said: "We are thrilled that the FDA has granted Fast Track designation for ALT-803 in NMIBC. This is a key milestone for advancing our NMIBC program. Patients with NMIBC have few treatment options and there is a significant unmet medical need for novel therapies in NMIBC, particularly in patients who are unresponsive to BCG. We are looking forward to working closely with FDA to facilitate our clinical program in this important indication."

About ALT-803

ALT-803 is a proprietary, novel IL-15 superagonist complex, which demonstrates improved pharmacokinetic properties and enhanced anti-tumor activity compared to IL-15 in preclinical studies. These studies also demonstrated that ALT-803 simultaneously mobilizes both the innate and adaptive arms of the immune system to elicit rapid, robust, and long-lasting responses against cancer and virally-infected cells. ALT-803 also potently activates NK cells and enhances antibody-dependent cell-mediated cytotoxicity (ADCC) of antibodies in various experimental models. Combination studies of ALT-803 with antibodies, targeted agents, and vaccines are underway and will further explore the role of ALT-803 in immunotherapy combinations for various disease indications. ALT-803 is currently being evaluated in multiple clinical trials for patients with solid or hematological tumors and in HIV infected individuals.