On December 10, 2015 Peregrine Pharmaceuticals, Inc. (NASDAQ:PPHM) (NASDAQ:PPHMP), a biopharmaceutical company focused on developing therapeutics to stimulate the body’s immune system to fight cancer, reported financial results for the second quarter of fiscal year (FY) 2016 ended October 31, 2015, and provided an update on its advancing clinical pipeline and other corporate developments (Press release, Peregrine Pharmaceuticals, DEC 10, 2015, View Source [SID:1234508530]).
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Highlights Since July 31, 2015
"I am pleased to report that we are nearing completion of enrollment for our Phase III SUNRISE trial with over 90% of the intended number of patients enrolled. We have also made substantial progress toward initiating several new trials including a Phase II/III breast cancer study and a Phase II NSCLC trial in combination with AstraZeneca’s anti-PD-L1 antibody, durvalumab," said Steven W. King, president and chief executive officer of Peregrine. "Our goal is to transition our leading SUNRISE clinical sites into our new Phase II NSCLC trial which should significantly expedite study start-up activities. We are encouraged by the fact that a number of investigators from hospitals that participated in the SUNRISE trial have already enthusiastically agreed to participate in our upcoming NSCLC trial."
"As treatment paradigms shift to incorporate new drugs, it is clear that both chemotherapy and immuno-oncology agents will continue to be critical to patient care. Taken together, we believe our SUNRISE trial, as well as the newly planned breast and lung cancer trials will allow us to maximize the potential of bavituximab in both settings," said Joseph Shan, vice president of clinical and regulatory affairs of Peregrine. "We are committed to continuing to identify new potential indications, patient populations and therapies that can benefit from combination treatment with bavituximab. From what we have seen to date in our preclinical and translational studies, the opportunity appears vast, and we are hard at work converting the most promising prospects into true value."
Clinical Development Highlights
As of today, more than 90% of the planned number of patients have been enrolled in the Phase III SUNRISE trial, representing a sufficient number of patients required to trigger the two pre-planned interim analyses as well as the final analysis for trial unblinding. The company expects to reach the trial’s estimated enrollment of 582 patients in the coming weeks.
Peregrine and AstraZeneca expanded their cancer immunotherapy clinical trial collaboration to evaluate bavituximab in combination with AstraZeneca’s investigational anti-PD-L1 immune checkpoint inhibitor, durvalumab (MEDI4736). The companies are currently planning a global Phase II study in patients with previously treated squamous or non-squamous NSCLC, as well as a Phase I/Ib trial that will evaluate the safety and efficacy of bavituximab in combination with durvalumab and chemotherapy in multiple solid tumors. The company expects the Phase II study to be initiated in early 2016 with the Phase I/Ib study beginning later in 2016.
Peregrine continues to finalize plans for its Phase II/III trial to evaluate bavituximab with chemotherapy combinations in HER2-negative metastatic breast cancer. This trial is on track to be initiated by the end of calendar year 2015.
Supportive Research Highlights
Positive results were presented at the 2015 annual meeting of the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) from multiple new preclinical studies demonstrating enhanced anti-tumor activity and immune activation for combinations of a preclinical bavituximab equivalent and checkpoint inhibitors such as anti-PD-1 and anti-CTLA-4 in preclinical models of breast cancer and melanoma. Additionally, the company announced preliminary results for a new clinical test specifically designed to illustrate how bavituximab modulates immune responses in the tumor microenvironment.
New data presented at the International Association for the Study of Lung Cancer’s (IASLC’s) World Conference on Lung Cancer (WCLC) from a translational study of bavituximab demonstrated the ability of bavituximab, alone or in combination with docetaxel, to induce signs of immune activation in non-small cell lung cancer (NSCLC) patient-derived tumor samples, particularly when there was negative PD-L1 expression in the tumor sample. These data further support the potential mechanistic synergies for bavituximab with chemotherapy and checkpoint inhibitors targeting the PD-1/PD-L1 pathway.
Summary data presented at the Combination Immunotherapy Strategies session at the 10th Annual Immunotherapy and Vaccine Summit (ImVacS), highlighted key findings from several recent bavituximab-focused studies including: the potential of bavituximab to shift the tumor microenvironment from immuno-suppressive in which tumors evade immune detection to a state of immune activation in which the immune system recognizes and fights the tumor; bavituximab’s potential to increase the number of activated CD8+ cells in the tumor, which stimulates PD-1 expression, potentially increasing the number of patients able to respond to PD-1 and PD-L1 targeting immunotherapies; and, results from several clinical and preclinical studies in a range of tumor types showing that bavituximab and bavituximab-like antibodies, in combination with conventional therapy, have consistently demonstrated Kaplan-Meier graphs that follow the classic immunotherapy survival plateau.
Corporate Highlights
Peregrine closed a registered direct offering to a single institutional investor raising $20 million dollars. The funds raised from this financing will support the ongoing Phase III SUNRISE trial, and newly planned later-stage company-sponsored trials in breast cancer and NSCLC.
Avid Bioservices Highlights
"Our contract manufacturing business continues to strengthen with a 52% current quarter increase in revenue compared to the prior year period and year-to-date growth of 61%," stated Paul Lytle, chief financial officer of Peregrine. "Our new state-of-the-art manufacturing facility is now ready for the initial phase of GMP manufacturing and demand for Avid’s capacity continues to grow with our current backlog now at $49 million. Given the revenue growth and committed backlog, we are increasing our contract manufacturing revenue guidance to a range of $35 to $40 million for the full-year 2016."
During the second quarter of FY 2016, Avid Bioservices achieved record-breaking revenues generating approximately $9.5 million dollars, a 52% increase in revenue compared to the same quarter in the prior year.
Avid’s new manufacturing facility is now ready for the initial phase of GMP manufacturing. The state-of-the-art facility will accommodate single use bioreactors (SUBs) at up to 2,000 liter scale. Upcoming production runs will support late stage clinical development as well as process validation activities in anticipation of bavituximab and other client commercial product needs. The facility has the capacity to potentially generate approximately $40 million in new revenue annually.
Contract manufacturing committed backlog reached $49 million from existing customers covering services to be completed in FY 2016 and into FY 2017.
Financial Results
Total revenues for the second quarter of FY 2016 were $9,523,000, compared to $6,300,000 for the same quarter of the prior fiscal year. The increase was attributed to an increase in contract manufacturing revenue generated from Avid Bioservices.
Contract manufacturing revenue from Avid’s clinical and commercial biomanufacturing services provided to its third-party clients for the second quarter FY 2016 were $9,523,000, compared to $6,263,000 for the same quarter of the prior fiscal year. Peregrine expects third-party contract manufacturing revenue for the entire fiscal year to be between $35 million and $40 million, compared to previous guidance of $30 million to $35 million during last quarter’s earnings call. In addition to providing biomanufacturing services to its third-party clients, Avid will continue to support the clinical development and potential commercialization of bavituximab.
Total costs and expenses in the second quarter of FY 2016 were $23,347,000, compared to $18,437,000 in the second quarter of FY 2015. This increase was primarily attributable to current quarter increases in research and development expenses associated with the SUNRISE Phase III trial, newly planned later-stage company-sponsored trials in breast cancer and NSCLC, and an increase in the cost of contract manufacturing associated with higher reported revenue. For the second quarter of FY 2016, research and development expenses were $14,190,000, compared to $10,003,000 for the second quarter of FY 2015. For the second quarter of FY 2016, cost of contract manufacturing was $4,741,000, compared to $4,139,000 for the second quarter of FY 2015.
Peregrine’s consolidated net loss attributable to common stockholders was $14,578,000, or $0.07 per share, for the second quarter of FY 2016, compared to a net loss attributable to common stockholders of $13,131,000, or $0.07 per share, for the same prior year quarter.
Peregrine reported $72,005,000 in cash and cash equivalents as of October 31, 2015 compared to $68,001,000 at fiscal year ended April 30, 2015.
More detailed financial information and analysis may be found in Peregrine’s Quarterly Report on Form 10-Q, which will be filed with the Securities and Exchange Commission today.