On May 6, 2016 PharMerica Corporation (NYSE:PMC), a national provider of institutional, specialty home infusion, hospital and oncology pharmacy services, reported its financial results for the first quarter ended March 31, 2016 (Press release, PharMerica, MAY 6, 2016, View Source;p=RssLanding&cat=news&id=2166002 [SID:1234512064]).

1Q’16 Results
Comparison to
1Q’15

Comparison to
4Q’15
Revenue $524.5 million Increase of 2.5% Increase of 0.7%
Adjusted EBITDA $30.3 million Decrease of 14.4% Decrease of 12.7%
Adjusted diluted earnings per share
$0.45 Decrease of 21.1% Decrease of 19.6%
Gross profit $82.0 million Decrease of 7.4% Decrease of 5.4%
Selling, general and administrative $57.0 million Decrease of 3.4% Increase of 2.9%
Generic drug dispensing rate
86.6% Increase of 130 basis points Increase of 30 basis points

Greg Weishar, PharMerica Corporation’s Chief Executive Officer, said, "PharMerica’s first quarter 2016 exceeded our expectations. We believe we are well positioned to deliver on our 2016 financial objectives while driving continued growth and shareholder value creation.

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!

"Prescriptions dispensed in the first quarter of 2016 were 8.6 million as compared to 8.4 million in the fourth quarter of 2015 and 8.2 million in the third quarter of 2015. This quarter represents the second sequential quarterly increase in prescription volume. In addition, we continue to improve the generic drug dispensing rate; this quarter’s rate of 86.6% represents a 130 basis point increase versus the first quarter of 2015. We expect the generic dispensing rate to further improve as brand patent expirations occur throughout this year and beyond.

"Also, we continue to make progress with respect to the diversification program. Specialty home infusion, oncology and hospital pharmacy management revenues grew 47% on a year over year basis. We achieved revenue growth both organically and through acquisitions. Importantly, EBITDA is growing faster than revenues as higher prescription volumes drive operating leverage. We are confident diversified revenues will exceed $700 million in 2017, and the diversification program will meaningfully contribute to the Company’s overall EBITDA growth over the next several years.

Mr. Weishar concluded, "In summary, we are off to a good start in 2016, and we will continue to pursue attractive acquisitions that drive share and scale. We remain optimistic about the Company’s long-term prospects, and we are well positioned to return to strong growth in 2017 and beyond."

Full Year 2016 Financial Guidance

PharMerica reaffirms its full year 2016 guidance metrics:

Revenue in the range of $2.125 billion to $2.150 billion;
Adjusted EBITDA in the range of $130.3 million to $135.3 million; and
Adjusted diluted earnings per share in the range of $1.95 to $2.05.
The Company notes that its 2016 guidance does not include the effect of any future 2016 acquisitions.

First Quarter 2016 Results

The results for the first quarter 2016 are set forth below:

Key Comparisons of First Quarters Ended March 31, 2016 and 2015:
Revenues for the first quarter of 2016 were $524.5 million compared with $511.6 million for the first quarter of 2015, an increase of 2.5%. The increase in revenues of $12.9 million is due to significant organic growth and acquisitions in the Company’s specialty businesses, partially offset by the 2015 initiative to improve the overall quality mix of clients, the 2016 reduction in Medicare Part D reimbursement and 2015 brand to generic conversions.

Gross profit for the first quarter of 2016 was $82.0 million compared with $88.6 million in the first quarter of 2015; a decrease of 7.4%. The decrease in gross profit was driven by higher drug costs under the Cardinal Health prime vendor agreement, changes made in 2015 to improve the overall quality mix of clients and lower Medicare Part D reimbursement.

Selling, general and administrative expenses were $57.0 million or 10.9% of revenues for the three months ended March 31, 2016 compared to $59.0 million or 11.5% of revenues for the three months ended March 31, 2015. The decrease of $2.0 million was due to cost improvements and lower bad debt expense.
Adjusted EBITDA for the first quarter of 2016 was $30.3 million compared with $35.4 million in the first quarter of 2015; a decrease of 14.4%.

Net income for the first quarter of 2016 was $4.1 million, or $0.13 diluted earnings per share, compared to $9.6 million, or $0.31 diluted earnings per share, for the same period in 2015. Adjusted diluted earnings per share was $0.45 in the first quarter of 2016 compared to $0.57 in the first quarter of 2015.

Cash flows provided by operating activities for the first quarter of 2016 were $62.3 million compared with $44.3 million in the first quarter of 2015. The increase in cash from operating activities is due to a decrease in inventory purchases and a higher accounts payable balance due to the timing of the weekly Cardinal Health prime vendor payment. Additionally, in the first quarter of 2015, $48.8 million of AmerisourceBergen drug purchase payments were withheld.

On May 5, 2016 AMRI (NASDAQ: AMRI) reported that it has signed a definitive agreement to acquire all outstanding shares of Prime European Therapeuticals S.p.A., also known as "Euticals", in a transaction valued at approximately $358 million (EUR 315 million), consisting of shares of AMRI common stock, cash, and a seller note (Filing, 8-K, Albany Molecular Research, MAY 6, 2016, View Source [SID:1234512067]).

Euticals is a privately-held company headquartered in Lodi, Italy, specializing in custom synthesis and the manufacture of active pharmaceutical ingredients (APIs). It operates a network of API facilities primarily in Italy, Germany, U.S. and France.

"The acquisition of Euticals will provide us an established custom synthesis presence in Europe and will further build on our expertise in complex APIs, positioning AMRI as a preeminent provider of contract research, development and manufacturing services to the pharmaceutical industry," said William S. Marth, AMRI’s president and chief executive officer.

"Euticals’ expertise with niche and high barrier to entry technologies and products, including certain tetracyclines, monobactams, sterile and fermented APIs and controlled substances, will be a tremendous asset to us. Additionally, Euticals’ large base of over 400 customers will provide us with a number of new large pharma, biotech and generics partners, further extending our global reach and diversifying our revenue.

"Importantly, I am pleased that in connection with the closing of the transaction, Fernando Napolitano will be joining our Board of Directors on behalf of Lauro Cinquantesette, S.p.A (Lauro 57) and its majority investors, Clessidra Capital Partners II and Mandarin Capital Partner SCA SICAR. Clessidra’s and Mandarin’s combined expertise, deep contacts within the European pharmaceutical community and continued guidance will be invaluable to our efforts going forward. Margalit Fine, Euticals’ chief executive officer and former head of European API at Teva, will be leading Euticals’ operations as a senior executive for the combined company," Mr. Marth said.

"On behalf of Lauro 57 and its investors, we couldn’t be more pleased to be joining AMRI," said Clessidra Chief Executive Officer, Maurizio Bottinelli. "Its expertise in developing and manufacturing complex pharmaceutical products is well known and we look forward to joining forces to further expand our presence in the European community."

Strategic Benefits of the Transaction

· Significantly expands AMRI’s capabilities in custom and complex APIs

o Provides AMRI with an established European custom synthesis presence
o Expands expertise in multiple areas: sterile API, steroids, generics, fermentation, controlled substances and monobactams
o Provides an API portfolio that includes 50 active US Drug Master Files (DMFs), 17 EU Certificates of Suitability (COS) or Compliance with the European Pharmacopeia (CEP), 13 Japanese DMFs and 6 South Korean DMFs; with several APIs having filings in more than one of these areas and over two dozen other international filings

· Provides AMRI with global scale and a diverse customer and revenue base

o Euticals brings over 400 customers with no customer concentration
o With 75% of revenue outside North America, Euticals opens up many new markets for AMRI; more than half AMRI’s combined proforma revenue is expected to be ex U.S.
o Euticals brings additional portfolio diversification in generics; AMRI to leverage U.S. base to include Euticals’ strong generic portfolio

Euticals operates a highly regarded API, custom synthesis and fine chemical development and manufacturing business with 2015 revenue and EBITDA of approximately $245 million and $27 million respectively. On a stand-alone basis, Euticals’ full year 2016 revenue is forecast to be between $245 million and $255 million, with adjusted EBITDA1 of between $34 million and $38 million, implying a purchase price multiple, prior to anticipated synergies, of approximately 9.9 times 2016 adjusted EBITDA at the midpoint of the range and excluding deal related costs or purchase accounting impacts. The transaction is expected to be accretive to AMRI’s 2016 non-GAAP diluted earnings per share. AMRI expects to generate operational synergies of $13 to $15 million over the next three years. On a pro forma basis including synergies, AMRI’s full year 2017 revenue is forecast to exceed $750 million, with adjusted EBITDA margins of approximately 20%.

Transaction Details, Financing and Closing

AMRI expects to finance the transaction through the issuance of approximately 7 million shares of AMRI common stock (currently valued at $110 million, equal to approximately 19.75% of AMRI common stock); a seller note of $63 million; and the remainder in cash. Including Euticals, AMRI believes that it will have the financial strength to manage its increased debt and plans to de-lever based on a combination of EBITDA growth and/or principal re-payments.

AMRI has entered into debt financing commitments with JP Morgan and Barclays for amounts that are expected to be sufficient to provide funds necessary to consummate the transaction. In addition to the financing, the closing of the transaction is subject to customary closing conditions, including Hart-Scott-Rodino clearance in the U.S.

1EBITDA reflects IFRS with an adjustment to U.S. GAAP only for capitalization of R&D expenses

The 7 million shares of AMRI common stock (the "Shares") to be issued in connection with the transaction will be offered and sold outside the United States to Lauro 57, an eligible investor pursuant to Regulation S of the Securities Act of 1933, as amended (the "Securities Act").

The Shares have not been registered under the Securities Act, or the securities laws of any other jurisdiction, and may not be offered or sold in the United States absent registration under or an applicable exemption from such registration requirements. This press release does not constitute an offer to sell, or a solicitation of an offer to purchase, the Shares in any jurisdiction in which such offer or solicitation would be unlawful.

Nomura acted as exclusive financial advisor to AMRI in connection with this transaction and Goodwin Procter LLP and LCA Studio Legale acted as AMRI’s legal advisors. Lincoln International acted as sole financial advisor to Lauro 57, and Chiomenti Studio Legale and Debevoise & Plimpton LLP acted as Lauro 57’s legal advisors.

Use of Non-GAAP Financial Measures

This press release contains non-GAAP financial measures, such as EBITDA, which is adjusted to exclude, among other things, the impact of interest income and expense, depreciation and amortization expense, and income tax expense or benefit. We exclude these items from the non-GAAP financial measures because they are outside our normal operations. There are limitations in using non-GAAP financial measures, as they are not prepared in accordance with generally accepted accounting principles, and may be different than non-GAAP financial measures used by other companies. In particular, we believe that the inclusion of supplementary non-GAAP financial measures in this press release helps investors to gain a meaningful understanding of our core operating results and future prospects without the effect of these often-one-time charges, and is consistent with how management measures and forecasts the company’s performance, especially when comparing such results to prior periods or forecasts. Non-GAAP results also allow investors to compare the company’s operations against the financial results of other companies in the industry who similarly provide non-GAAP results. The non-GAAP financial measures included in this press release are not meant to be considered superior to or a substitute for results of operations prepared in accordance with GAAP. It is not feasible to provide reconciliation to the most comparable projected U.S. GAAP measure because the excluded items are difficult to predict and estimate and are primarily dependent on future events.

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!

On May 06, 2016 Myriad Genetics, Inc. (NASDAQ:MYGN), a leader in molecular diagnostics and personalized medicine, reported that results from three studies will be featured at the American Urological Association annual meeting, which will take place May 6-10 in San Diego, Calif (Press release, Myriad Genetics, MAY 6, 2016, View Source [SID:1234512009]). Poster discussions include new data for the Prolaris test in patients with low-risk prostate cancer, as well as investigational molecular diagnostic tests for renal and bladder cancer.

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!

"Prolaris is the leading prognostic genetic test for patients with prostate cancer and is the only such test that predicts the 10-year risk of real oncologic outcomes including death, metastases and recurrence. The evidence in favor of genetic testing is expanding, and we’re excited to present a new analysis at AUA that further confirms the strong prognostic power of Prolaris in men with low-risk localized prostate cancer," said Michael Brawer, senior vice president of Medical Affairs, Myriad Genetic Laboratories. "We also are presenting new data for our investigational renal and bladder cancer tests, which further underscore Myriad’s commitment to developing pioneering molecular diagnostic tests for other urologic diseases."

Results of the studies to be presented are described below and abstracts are now available at: www.aua2016.org/abstracts/. Follow Myriad on Twitter via @MyriadGenetics to stay informed about news and updates from the Company.

Highlighted Presentations

Title: The CCP score provides significant prognostic information in Gleason score <6 patients.
Date: Friday, May 6, 2016: 8:00—10:00 a.m. PT.
Location: Poster MP2.
Presenter: Jay Bishoff, M.D., Intermountain Urological Institute.
This meta-analysis of five studies evaluated the ability of the Prolaris test (CCP score) to predict oncologic outcomes (i.e., recurrence or death) in 440 patients with low-risk localized prostate cancer, which was defined as a Gleason score of 6 or less. The results showed that the Prolaris test is a significant predictor of oncologic outcomes in patients with low-risk disease (HR 1.5; p<0.009). Prolaris also was a better independent predictor of outcomes than traditional clinical features as measured by CAPRA (Cancer of the Prostate Risk Assessment; HR 1.27; p<0.03). When the Prolaris and CAPRA scores were assessed together, the combined clinical risk (CCR) score provided even greater predictive power (HR 1.83; p<0.0014). In this study, Prolaris was a strong predictor of the 10-year risk of oncologic outcomes in patients with localized prostate cancer and a Gleason score of 6 or less.

Title: A study to evaluate the prognostic and predictive utility of CCP and HRD assays and genetic sequencing in patients undergoing neoadjuvant chemotherapy in bladder cancer.
Date: Sunday, May 8, 2016: 1:00—3:00 p.m. PT.
Location: Poster MP49.
Presenter: Hristos Kaimakliotis, M.D., Indiana University.
This exploratory study evaluated three molecular assays to determine if they were able to predict response to neoadjuvant chemotherapy with cisplatin in patients with urothelial bladder cancer (UBC). The assays included 1) a cell cycle progression score, 2) the homologous recombination deficiency (HRD) score, and 3) genetic sequencing of a set of 80 genes associated with UBC. The results showed that RB1 mutations were associated with response to cisplatin neoadjuvant chemotherapy, and the predictive ability was improved by the addition of either the CCP or HRD scores. Additionally, HRD could be used to predict risk of disease recurrence in patients after neoadjuvant chemotherapy followed by cystectomy. If validated, these tests may help identify chemo-responsive patients.

Title: Prognostic utility of a multi-gene signature (the cell cycle proliferation score) in patients with renal cell carcinoma (RCC) after radical nephrectomy.
Date: Monday, May 9, 2016: 3:30—5:30 p.m. PT.
Location: Poster MP78.
Presenter: Adam Feldman, M.D., Massachusetts General Hospital.
The objective of this study was to assess the ability of the Myriad myPlan Renal Cancer cell cycle progression test to predict long-term oncologic outcomes in patients with surgically-resected renal cell carcinoma (RCC). Outcomes were defined as disease recurrence (local or metastatic) or disease-specific survival (DSS). Patient data were censored at five-years of follow-up. In the training cohort (N= 305), the myPlan Renal Cancer test was a significant prognostic predictor for recurrence (HR: 1.74; p = 0.02) and DSS (HR: 2.59; p< 0.001) after adjusting for clinical variables. The validation cohort (N=262) demonstrated a consistent and significant prediction of recurrence and DSS, with the strongest association being for DSS (HR: 2.2; p < 0.001) after adjusting for clinical variables. Based on these data, the myPlan Renal Cancer test appears to be a significant and independent predictor of key long-term oncologic outcomes in patients who have undergone nephrectomy for RCC, providing prognostic information beyond what is available from clinical parameters. Additional studies are underway to evaluate the utility of the score when derived from diagnostic biopsy.

About Prolaris
Prolaris is a novel 46-gene RNA-expression test that directly measures tumor cell growth characteristics for stratifying the risk of disease-specific mortality in patients with prostate cancer. Prolaris provides a quantitative measure of the RNA expression levels of genes involved in the progression of tumor growth. Low gene expression is associated with a low risk of disease-specific mortality in men who may be candidates for active surveillance and high gene expression is associated with a higher risk of disease-specific mortality in patients who may benefit from additional therapy. For more information visit: www.prolaris.com.

About myChoice HRD
Myriad’s myChoice HRD is the first homologous recombination deficiency test that can detect when a tumor has lost the ability to repair double-stranded DNA breaks, resulting in increased susceptibility to DNA-damaging drugs such as platinum drugs or PARP inhibitors. High myChoice HRD scores reflective of DNA repair deficiencies are prevalent in all breast cancer subtypes, ovarian and most other major cancers. In previously published data, Myriad showed that the myChoice HRD test predicted drug response to platinum therapy in certain patients with triple-negative breast and ovarian cancers. It is estimated that 1.8 million people in the United States and Europe who are diagnosed with cancers annually may be candidates for treatment with DNA-damaging agents. For more information visit: www.myriad.com.

About Myriad myPlan Renal Cancer
Myriad myPlan Renal Cancer is a molecular prognostic test that measures the expression levels of cell cycle progression genes to provide an accurate assessment of cancer aggressiveness in patients with renal cell carcinoma. For more information visit: View Source

On May 6, 2016 Mast Therapeutics, Inc. (NYSE MKT: MSTX), a biopharmaceutical company developing novel, clinical-stage therapies for sickle cell disease and heart failure, reported financial results for the first quarter ended March 31, 2016 (Filing, Q1, Mast Therapeutics, 2012, MAY 6, 2016, View Source [SID:1234512073]).

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!

"The first quarter of 2016 was a productive one for Mast. Not only did we complete enrollment in our Phase 3 EPIC study of vepoloxamer in sickle cell disease, but also we announced positive data from a Phase 2a study of AIR001 in patients with heart failure with preserved ejection fraction conducted at Mayo Clinic, and the selection of AIR001 for a double-blind, placebo-controlled Phase 2 study in approximately 100 patients with HFpEF to be conducted at premier U.S. clinical centers that make up the HFN," stated Brian M. Culley, Chief Executive Officer.

"With 388 patients, the EPIC study was the largest placebo-controlled study in sickle cell disease ever concluded and should provide many insights into the activity of vepoloxamer in this indication. Importantly, vepoloxamer has the potential to become the first and only approved therapy for shortening the duration of a sickle cell vaso-occlusive crisis and we are working diligently toward generating top-line results, which we expect to announce this quarter," continued Mr. Culley. "Meanwhile, we are advancing our two heart failure programs. Our 150-patient Phase 2 study of vepoloxamer in chronic heart failure is ongoing, with ten study sites now open, and the HFN’s 100-patient Phase 2 study of AIR001 in HFpEF is expected to begin in the third quarter of 2016."

First Quarter 2016 Operating Results

The Company’s net loss for the first quarter of 2016 was $11.2 million, or $0.06 per share (basic and diluted), compared to a net loss of $9.6 million, or $0.06 per share (basic and diluted), for the same period in 2015.

Research and development expenses for the first quarter of 2016 were $7.9 million, an increase of $1.9 million, or 30%, compared to $6.0 million for the same period in 2015. The increase was due mainly to increases of $0.9 million in external nonclinical study fees and expenses, $0.5 million in external clinical study fees and expenses, and $0.3 million in personnel expenses.

The increase in external nonclinical study fees and expenses was due primarily to increased costs related to preparation for a new drug application for vepoloxamer ($0.5 million) and research-related manufacturing for vepoloxamer ($0.5 million), offset by a decrease in research-related manufacturing for AIR001 ($0.1 million). The increase in external clinical study fees and expenses was due primarily to increased costs related to the Phase 2 study of vepoloxamer in heart failure ($0.5 million) and the EPIC study ($0.3 million), offset by a decrease

related to discontinuation of a Phase 2 study of vepoloxamer in acute limb ischemia, which the Company began to wind-down in the third quarter of 2015 ($0.3 million).

Selling, general and administrative (SG&A) expenses for the first quarter of 2016 were $2.8 million, a decrease of $0.8 million, or 21%, compared to $3.6 million for the same period in 2015. SG&A expenses for the first quarter of 2015 included $0.4 million of severance expenses and $0.3 million of share-based compensation resulting from the termination of employment of the Company’s former president and chief operating officer in February 2015 and the acceleration of stock option vesting pursuant to the terms of his option agreements.

Interest expense for the first quarter of 2016 was $0.5 million, which was related to the Company’s debt facility. There was no interest expense for the first quarter of 2015.

On May 6, 2016 Spectrum Pharmaceuticals (NasdaqGS: SPPI), a biotechnology company with fully integrated commercial and drug development operations with a primary focus in Hematology and Oncology, reported presentations of clinical data for apaziquone to be presented at an oral presentation and a moderated poster session at the American Urological Association Education and Research Inc., being held in San Diego, California, from May 6-10, 2016 (Press release, Spectrum Pharmaceuticals, MAY 6, 2016, View Source [SID:1234512013]).

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!

For more information about the AUA Meeting and for a complete list of abstracts, please refer to the conference web site at View Source

Friday, May 6, 2016 1:00 PM-3:00 PM PT (Moderated Poster Session)

Abstract # Type Title First Author Location

MP13-07
Poster
Improved Efficacy of Adjuvant, Single Dose Intravesical Apaziquone by Timing post-Resection in Two Double
blind, Randomized, Placebo-Controlled Phase 3 Studies in Non-Muscle Invasive Bladder Cancer
Fred Witjes
Room 28 ABC

Saturday, May 7, 2016, 8:00 AM-10:00 AM PT (Podium Presentation)

Abstract # Type Title First Author Location

PD11-07
Podium
Integrated Results of Two Multicenter, Randomized, Placebo Controlled, Double Blind, Phase 3 Trials (SPI-611/612) of Single-Dose Intravesical Apaziquone Immediately Following Resection in Patients with Non-Muscle Invasive Bladder Cancer