ATHERSYS ANNOUNCES FINANCIAL RESULTS FOR FOURTH QUARTER AND FULL YEAR 2018

On March 14, 2019 Athersys, Inc. (NASDAQ: ATHX) reported its fourth quarter 2018 and annual 2018 financial results and recent highlights (Press release, Athersys, MAR 14, 2019, View Source [SID1234534341]).

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"As we have announced previously, we had a number of important accomplishments in 2018, including the initiation of our Phase 3 MASTERS-2 study and the expansion of our partnership with Healios. Additionally, we completed enrollment of, and recently announced positive results for, our exploratory clinical study of MultiStem treatment of acute respiratory distress syndrome patients," commented Dr. Gil Van Bokkelen, Chairman and Chief Executive Officer of Athersys. "We also finished the year in a meaningfully stronger financial position, which was an important objective."

Fourth Quarter 2018 and Recent Highlights:

Announced positive results from our exploratory clinical study of MultiStem cell therapy for treatment of acute respiratory distress syndrome (ARDS), further confirming the tolerability and safety profile of MultiStem treatment and demonstrating trends of lower mortality and greater ventilator-free and ICU-free days; the study has been selected for presentation at the American Thoracic Society International Conference in May 2019;
Our partner, HEALIOS K.K. (Healios), announced plans to initiate an ARDS trial using MultiStem therapy for patients in Japan, which, if successful could lead to registration under Japan’s regenerative medicine regulatory framework;
Advanced our ischemic stroke program through continued support of Healios’ Japan TREASURE trial and enrollment of our MASTERS-2 Phase 3 registration study for ischemic stroke;
Received a $2.0 million payment from Healios for a right of first negotiation through June 2019 for an option to develop and commercialize MultiStem therapy for certain indications in China; Healios may extend the negotiation period through December 2019 with an additional payment of $3.0 million;
Recognized revenues of $1.5 million and net loss of $11.3 million, or $0.08 net loss per share, for the quarter ended December 31, 2018; and
Ended 2018 with $51.1 million in cash and cash equivalents and February 28, 2019 with $51.5 million in cash and cash equivalents, reflecting a solid financial foundation.
Other 2018 Highlights:

Expanded our collaboration with Healios in June 2018 to include additional areas – such as development for the treatment of ARDS in Japan, iPSC and MultiStem cells in combination to treat dysfunction in certain organs in Japan, and potential use of MultiStem cells alone or with RPE cells for certain ophthalmological indications globally – for $20 million in license fees, plus potential milestone payments and royalties; this followed a $21.1 million investment by Healios through the purchase of our common stock in March 2018;
Commenced the MASTERS-2 Phase 3 registration study for ischemic stroke and started enrolling patients;
Completed the enrollment of our exploratory clinical study of MultiStem cell therapy treatment for ARDS, and announced positive results soon thereafter as noted above;
Announced grant funding and began preparations to conduct a Phase 2 clinical trial evaluating MultiStem cell therapy for early treatment and prevention of complications after severe traumatic injury, in collaboration with The University of Texas Health Science Center at Houston and Hermann Memorial Trauma Center;
Expanded our process development and manufacturing efforts, including strategic leadership hires and diversification in our manufacturing networks; and
Entered into a new equity facility during the first quarter of 2018 as a follow-on to the existing facility, giving us the right to sell up to $100 million of common stock over a three-year period, providing access to capital, as needed, to support operations.
"We believe we are well-positioned to capitalize on our innovative MultiStem product platform and to develop and deliver highly effective new treatments to patients in areas of substantial unmet medical need, particularly in the critical care area. The Healios’ TREASURE trial and our MASTERS-2 trial are making continued progress, and the results from our exploratory ARDS trial illustrate the potential of MultiStem therapy in other acute care settings. We continue to work toward the scale-up of our manufacturing capabilities and to focus on the further development of other core capabilities and programs, while we continue to explore additional partnering opportunities," concluded Dr. Van Bokkelen.

Fourth Quarter 2018 Financial Results

Revenues increased to $1.5 million for the three months ended December 31, 2018 compared to $1.2 million for the three months ended December 31, 2017. Our revenues are generally derived from license fees, manufacturing-related services for Healios, royalty and related contract revenue from our collaborations, and grant revenue.

Research and development expenses decreased to $10.2 million for the three months ended December 31, 2018 from $12.1 million for the comparable period in 2017. In 2017, approximately $4.7 million of license fees were expensed (of which $3.2 million was non-cash) related to a settlement and license agreement. After factoring in this one-time charge, the net $2.8 million increase is associated with increased clinical development costs of $1.6 million, personnel costs of $0.6 million, internal research supplies of $0.2 million and other expenses of $0.4 million. The $1.6 million increase in our clinical costs during the period is primarily related to clinical product manufacturing, covered in part by Healios, technology transfer services associated with planned Japan manufacturing for Healios, process development activities to support large-scale manufacturing, and our MASTERS-2 clinical trial that began enrolling patients in the third quarter of 2018.

General and administrative expenses increased to $2.8 million for the three months ended December 31, 2018 from $2.1 million in the comparable period in 2017. The $0.7 million increase was due primarily to increases in personnel costs, professional fees, stock compensation costs and other administrative costs compared to the same period last year.

Net loss for the fourth quarter was $11.3 million in 2018 compared to a net loss of $13.1 million in the fourth quarter of 2017. The difference of $1.8 million reflects the above variances, as well as an increase of $0.3 million in other income items.

Full Year 2018 Financial Results

Revenues increased to $24.3 million for the year ended December 31, 2018 from $3.7 million in 2017. Our contract revenues from our collaboration with Healios increased $21.4 million year over year, reflecting the expansion of our collaboration in June 2018 to include additional licensed indications, among other things. Included in our 2018 revenues were royalties and other contract revenues of $1.5 million ($1.9 million in 2017) primarily related to our collaboration with RTI Surgical, Inc., which recently announced that it will cease distribution of its bone graft product that utilizes our technology.

Research and development expenses increased to $38.7 million for the year ended December 31, 2018 from $27.8 million for the year ended December 31, 2017. The increase in research and development expenses year-over-year of $10.9 million related to increases in clinical trial and manufacturing process development costs of $11.4 million, personnel costs of $1.6 million, and internal supply and other costs of $1.6 million. These increases were partially offset by a decrease in license fees of $3.7 million related to the settlement and license agreement in 2017 with one-time payments of cash and stock that concluded in 2018.

General and administrative expenses increased to $10.4 million in 2018 from $8.5 million in 2017. The $1.9 million increase was due primarily to increases in personnel costs, legal and professional services and stock compensation expense.

Net loss was $24.3 million in 2018 compared to a net loss of $32.2 million in 2017. The difference of $7.9 million reflects the above variances, as well as a decrease of $0.1 million in other net expenses.

In the twelve months ended December 31, 2018, net cash used in operating activities was $13.4 million compared to $24.0 million in the twelve months ended December 31, 2017. The difference reflects in part license fees paid by Healios in connection with the collaboration expansion being partially offset by an increase in clinical development activity in 2018.

At December 31, 2018, we had $51.1 million in cash and cash equivalents, compared to $29.3 million at December 31, 2017.

Conference Call

Gil Van Bokkelen, Chairman and Chief Executive Officer, William (B.J.) Lehmann, President and Chief Operating Officer, and Laura Campbell, Senior Vice President of Finance, will host a conference call today to review the results as follows:

Date March 14, 2019
Time 4:30 p.m. (Eastern Time)
Telephone access: U.S. and Canada (877) 396-3286
Telephone access: International (647) 689-5528
Encore Password (needed for the replay only) 7677927
Live webcast www.athersys.com, under the Investors section
We encourage shareholders to listen using the webcast link, and to use the phone line if you intend to ask a question. A replay will be available on the webcast at www.athersys.com under the investors section approximately two hours after the call has ended. Shareholders may also call in for on-demand listening shortly after the completion of the call until 11:59 PM Eastern Time on March 21, 2019 by dialing (800) 585-8367 or (416) 621-4642 and entering Encore passcode 7677927. The archived webcast will be available for one year at the aforementioned URL.

DXC Technology Company Recommends Stockholders Reject “Mini-Tender” Offer by TRC Capital Corporation

On March 14, 2019 DXC Technology (NYSE: DXC) reported that it has received notice of an unsolicited "mini-tender" offer by TRC Capital Corporation to purchase up to two million shares of DXC’s common stock at a price of $63.63 per share in cash (Press release, DynPort Vaccine Company, MAR 14, 2019, View Source [SID1234534345]). The offering price is 4.56 percent below the closing price per share of DXC’s common stock on February 22, 2019, the last trading day before the tender offer commenced. The offer is for approximately 0.75 percent of the outstanding shares of DXC’s common stock.

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DXC does not endorse TRC Capital’s unsolicited mini-tender offer and recommends that stockholders reject the offer of TRC Capital and not tender their shares. DXC is not associated with TRC Capital, its mini-tender offer or the mini-tender offer documentation.

Mini-tender offers are not subject to many of the investor protections afforded to larger tender offers, including the filing of disclosure and other tender offer documents with the U.S. Securities and Exchange Commission (SEC) and other procedures mandated by U.S. securities laws.

The SEC has cautioned investors that some bidders making mini-tender offers at below-market prices are, "hoping that they will catch investors off guard if the investors do not compare the offer price to the current market price." The SEC’s guidance to investors on mini-tender offers is available at View Source TRC Capital has made many similar unsolicited mini-tender offers for shares of other public companies.

Stockholders should obtain current market quotations for their shares, consult with their broker or financial advisor, and exercise caution with respect to TRC Capital’s mini-tender offer. DXC recommends that stockholders who have not responded to TRC Capital’s offer take no action. Stockholders who have already tendered their shares may withdraw them at any time prior to 12:01 a.m., New York City time, on March 26, 2019, in accordance with TRC Capital’s offering documents.

DXC encourages brokers and dealers, as well as other market participants, to review the SEC’s letter regarding broker-dealer mini-tender offer dissemination and disclosure at View Source

DXC requests that a copy of this press release be included with all distributions of materials relating to TRC Capital’s mini-tender offer for shares of DXC common stock.

Ambry Genetics to Develop Custom Assays Targeted to Patients with Hereditary Ovarian Cancer

On March 13, 2019 Ambry Genetics, a Konica Minolta Company (Ambry), and leading provider of clinical and research genetic testing, reported a new laboratory services agreement with Clovis Oncology Inc., a biopharmaceutical company which shares Ambry’s commitment to advancing precision medicine for cancer (Press release, Ambry Genetics, MAR 13, 2019, View Source [SID1234553909]). Through this laboratory services agreement, Ambry Genetics and Clovis Oncology seek to identify clinical trial patients who may benefit from Rubraca, a therapy currently approved in the U.S. and Europe in multiple advanced ovarian cancer settings.

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Approximately 10 to 15% of ovarian cancer diagnoses are based on hereditary mutations of BRCA, meaning they are directly linked to mutations in the BRCA1 or BRCA2 genes passed on from a parent. Ambry’s genetic tests can identify mutations in these two genes, as well as related genes involved in the DNA repair pathway, thus enabling identification of potential risk, earlier diagnosis and more precise treatment.

"We are very excited to be working with the Clovis team, which is aligned with our precision medicine initiatives," said Brigette Tippin Davis, Ph.D., FACMG, Senior Vice President of Research & Development of Ambry Genetics, Inc. "Our mission is to help identify patients eligible for optimal therapies to improve outcomes and enhance quality of life."

Clovis chose to perform retrospective BRCA testing with Ambry Genetics, a high-quality genetics lab positioned to become a key player in the precision medicine space.

ArQule to Present at Oppenheimer’s 29th Annual Healthcare Conference on March 20, 2019

On March 13, 2019 ArQule, Inc. (Nasdaq: ARQL) reported that Peter Lawrence, President and Chief Operating Officer, and Brian Schwartz, MD, Chief Medical Officer and Head of Research and Development, of ArQule will present at Oppenheimer’s 29th Annual Healthcare Conference on March 20, 2019 at 10:20 a.m. ET at the Westin New York Grand Central in New York City (Press release, ArQule, MAR 13, 2019, View Source [SID1234534276]).

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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

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The live webcast of the presentation will be available via the "Investors & Media" section of ArQule’s website, www.arqule.com, under "Events & Presentations." A replay of the webcast will be available shortly after the conclusion of the presentation.

Sophiris Bio Reports Fourth Quarter 2018 and Year-end Financial Results and Recent Corporate Highlights

On March 13, 2019 Sophiris Bio Inc. (NASDAQ: SPHS) (the "Company," "We" or "Sophiris"), a biopharmaceutical company developing topsalysin (PRX302), a first-in-class, pore-forming protein, in late-stage clinical trials for the treatment of patients with urological diseases, today reported financial results for the fourth quarter and full year 2018 and recent corporate highlights (Press release, Sophiris Bio, MAR 13, 2019, View Source [SID1234534299]).

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"During the past year, Sophiris has made important progress in determining the ideal method for topsalysin administration as a focal treatment for localized prostate cancer," said Randall E. Woods, president and CEO of Sophiris. "The Phase 2b study provided a compelling look at this potential, showing that a single administration of topsalysin led to a clinical response in 27% of patients, including a complete ablation of tumor in 16% of patients. Our investigators have also noted that a drug capable of delaying or obviating the need for radical therapy in nearly a third of the patient population with the potential safety profile that we have seen to date could be very attractive for patients with localized intermediate risk prostate cancer."

Allison Hulme, Ph.D., chief operating officer and head of R&D for Sophiris, added: "In recent weeks we have made significant progress on a key next step for the development of topsalysin: the development of a Phase 3 protocol for localized prostate cancer. Based on both the efficacy and the encouraging safety data from our Phase 2 program and the invaluable input from our Scientific Advisory Board who are supportive of our continuing development of topsalysin as a focal therapy, we have finalized a proposed Phase 3 design and initiated the process of obtaining formal scientific advice from the European Medicines Agency (EMA). We are on track to obtain feedback from the EMA in the first half of this year."

Woods added, "In addition to working with regulatory authorities to determine the potential path to market, we have been actively pursuing options to move topsalysin into the final stages of clinical development, and we currently believe that the ideal funding option will either be a potential development partnership or other strategic transaction. We have also re-prioritized some development activities enabling us to extend our cash runway through the third quarter of this year."

Recent Corporate Highlights:

Completion of Phase 2b trial in localized prostate cancer. In December, we provided top-line data from patients who received a second administration of topsalysin in the trial. Eleven of the 37 patients evaluated six months after receiving a single administration of topsalysin went on to receive a second administration. It was determined that both the first and the second administration of topsalysin continue to appear safe and well-tolerated by patients. There were no adverse events considered related to topsalysin that were experienced by more than one patient following the second administration. Importantly, a total of 27% of patients (10/37) demonstrated a clinical response six months following the first administration of topsalysin. Six of the ten clinical responders experienced a complete ablation of their tumor with no remaining tumor detected following a targeted biopsy of the treated area.
Preparations for Phase 3 trial in localized prostate cancer. We, along with our Scientific Advisory Board and our other scientific advisors, believe that the data generated in the single-administration portion of the Phase 2b prostate cancer study supports the advancement of the program into a single Phase 3 pivotal trial. Currently, we have initiated formal scientific advice with EMA and in the coming weeks plan to initiate dialog with the U.S. Food and Drug Administration on the single confirmatory Phase 3 design.
Completion of topsalysin drug substance manufacturing. We recently completed the manufacture of a batch of topsalysin drug substance, which is planned for use in the upcoming Phase 3 confirmatory study in localized prostate cancer.
Funding of future development of topsalysin. The management team remains focused on determining the best path forward for funding future clinical development for topsalysin and continues to engage in strategic discussions as part of this effort.
Financial Results:

At December 31, 2018, the Company had cash, cash equivalents and securities available-for-sale of $12.5 million and working capital of $8.2 million. The Company expects that its existing cash and cash equivalents will be sufficient to fund its operations through September 2019, assuming no new clinical trials are initiated and the Company continues operating as a going concern. The Company will require significant additional funding to advance topsalysin in clinical development. As of December 31, 2018, the outstanding principal balance of the Company’s term loan was $7 million on which the Company is currently making monthly interest only payments and is scheduled to begin making principal payments in April 2019.

For the three months ended December 31, 2018

The Company reported a net income of $5.5 million or $0.18 per share for the three months ended December 31, 2018, compared to net loss of $4.0 million or ($0.13) per share for the three months ended December 31, 2017. The net income for the three months ended December 31, 2018 was driven by a non-cash gain related to the revaluation of the Company’s warrant liability.

Research and development expenses

Research and development expenses were $2.0 million for the three months ended December 31, 2018, compared to $1.9 million for the three months ended December 31, 2017. The increase in research and development costs was primarily attributable to increases in the costs associated with manufacturing activities for topsalysin offset in part by a decrease in personnel related costs.

General and administrative expenses

General and administrative expenses were $0.9 million for the three months ended December 31, 2018, compared to $1.3 million for the three months ended December 31, 2017. The decrease in general and administrative expense was primarily due to decreases in personnel related expenses and marketing research activities.

Gain (loss) on revaluation of the warrant liability

Gain on revaluation of the warrant liability was $8.5 million for the three months ended December 31, 2018, compared to a loss on the revaluation of the warrant liability of $0.6 million for the three months ended December 31, 2017. The Company’s outstanding warrants may require it to pay the warrant holder cash under certain provisions of the warrant therefore the Company accounts for these warrants as a liability, and the Company is required to calculate the fair value of these warrants each reporting date. The non-cash gain reported for the three months ended December 31, 2018, was associated with a decrease in the fair value of the Company’s warrant liability from September 30, 2018 to December 31, 2018, which is calculated using a Black-Scholes pricing model. The decrease in the fair market value of the Company’s warrant liability was directly related to a decrease in the Company’s stock price from September 30, 2018 to December 31, 2018. Certain inputs utilized in the Company’s Black-Scholes fair value calculation may fluctuate in future periods based upon factors which are outside of the Company’s control. A significant change in one or more of these inputs used in the calculation of the fair value may cause a significant change to the fair value of the Company’s warrant liability, which could also result in a material non-cash gain or loss being reported in the Company’s consolidated statement of operations and comprehensive loss.

For the year ended December 31, 2018

The Company reported a net loss of $6.8 million or ($0.23) per share for the year ended December 31, 2018 compared to a net loss of $8.6 million or ($0.29) per share for the year ended December 31, 2017.

Research and development expenses

Research and development expenses were $10.7 million for the year ended December 31, 2018 compared to $6.2 million for the year ended December 31, 2017. The increase in research and development costs was primarily attributable to increases in the costs associated with manufacturing activities for topsalysin.

General and administrative expenses

General and administrative expenses were $4.4 million for the year ended December 31, 2018 compared to $5.7 million for the year ended December 31, 2017. The decrease in general and administrative expense was primarily due to decreases in non-cash stock-based compensation expense, marketing research activities and its personnel related costs.

Gain on revaluation of the warrant liability

Gain on revaluation of the warrant liability was $8.7 million for the year ended December 31, 2018 as compared to a gain of $3.3 million for the year ended December 31, 2017. The non-cash gain is associated with the change in the fair value of our warrant liability which was calculated using a Black-Scholes pricing model.