On April 28, 2016 Keryx Biopharmaceuticals, Inc. (Nasdaq:KERX), a biopharmaceutical company focused on bringing innovative medicines to people with renal disease, reported its financial results for the first quarter ended March 31, 2016 (Press release, Keryx Biopharmaceuticals, APR 28, 2016, View Source;p=RssLanding&cat=news&id=2162640 [SID:1234511539]).

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!

"In March, our recently expanded and fully trained field team began calling on physicians, dietitians and the entire dialysis care team to enhance awareness of Auryxia and drive increased adoption," said Greg Madison, chief executive officer of Keryx Biopharmaceuticals. "Through the expansion of our field team, we are able to increase the reach and frequency of contact with the treating community, and I am confident that with their efforts we will continue to increase uptake of Auryxia in people with chronic kidney disease (CKD) on dialysis."

Mr. Madison continued, "In the first quarter, we announced positive top-line results from our pivotal Phase 3 study evaluating ferric citrate in people with non-dialysis dependent CKD struggling with iron deficiency anemia (IDA). These results bring us one step closer to treating another important complication of CKD. The rapid, durable and significant responses observed with ferric citrate in the study were a major milestone for Keryx and confirmed the unique attributes of ferric citrate’s mechanism of action, which delivers iron orally through the body’s natural absorption process. As we look ahead, our top priorities for this year are to increase adoption of Auryxia in the dialysis setting, submit a regulatory application seeking label expansion, and prepare for potential launch in 2017 in the new indication."

FIRST QUARTER 2016 BUSINESS HIGHLIGHTS

Auryxia Commercialization

Auryxia net U.S. product sales for the first quarter of 2016 were $5.6 million compared with $0.4 million in the first quarter of 2015. First quarter 2016 Auryxia product sales resulted from approximately 9,150 prescriptions, which represented 17 percent growth in total prescriptions compared to the fourth quarter of 2015.

In the first quarter of 2016, cumulative target physicians who have written a prescription for Auryxia increased approximately 25 percent from the fourth quarter of 2015. This reflects continued efforts to increase the breadth of physicians prescribing Auryxia.
Potential Label Expansion
Pivotal Phase 3 Trial Aimed at Increasing the Number of Adults Eligible for Treatment with Ferric Citrate

In March, the company announced that its 24-week pivotal Phase 3 trial evaluating ferric citrate for the treatment of iron deficiency anemia in adults with stage 3-5 non-dialysis dependent CKD demonstrated statistically significant differences between ferric citrate- and placebo-treated patients for the primary and all pre-specified secondary endpoints. Specifically, 52 percent (61/117) of patients who received ferric citrate achieved the primary endpoint, which was a 1g/dL or greater rise in hemoglobin at any time point during the 16-week randomized efficacy period, compared with 19 percent (22/115) in the placebo group (p<0.001). Importantly, the vast majority of patients who achieved the primary endpoint (57/61) had a durable response. In terms of safety, during the randomized efficacy period, the majority of adverse events reported were mild to moderate, with the most common being diarrhea. Read the full press release of the top-line Phase 3 results here.

The company intends to submit an sNDA for approval to the U.S. FDA in the third quarter of 2016.

Keryx plans to submit detailed Phase 3 results for presentation at the American Society of Nephrology’s 2016 Kidney Week taking place November 15 – 20, 2016, and plans to submit data for possible publication in a peer reviewed medical journal.
Corporate

In April, Keryx announced new appointments and changes to its board of directors.
First Quarter Ended March 31, 2016 Financial Results
"As a result of our continued focus on commercial execution and fiscal discipline, we met or exceeded all of our internal financial goals in the first quarter and, therefore, are progressing nicely toward achieving our previously stated 2016 full year financial objectives," said Scott Holmes, chief financial officer of Keryx. "The passion and commitment that my colleagues at Keryx bring to work each day both in the field and in our home office will drive us to achieve our goals in 2016 and beyond."

At March 31, 2016, the company had cash and cash equivalents of $170.5 million.

Total revenues for the quarter ended March 31, 2016 were approximately $6.8 million, compared with $1.2 million during the same period in 2015. Total revenues for the quarter consisted of Auryxia net U.S. product sales of $5.6 million, and license revenue of $1.2 million associated with royalties received on ferric citrate net sales from Keryx’s Japanese partner.

Cost of goods sold for the quarter ended March 31, 2016 was $1.1 million or 19 percent of Auryxia net U.S. product sales, as compared with $0.1 million or 18 percent during the same period in 2015.

Research and development expenses for the quarter ended March 31, 2016 were $7.6 million compared with $9.6 million during the same period in 2015. The decrease was primarily due to a decrease in costs associated with the company’s recently completed Phase 3 clinical trial evaluating ferric citrate for the treatment of IDA in adults with stage 3-5 non-dialysis dependent CKD.

Selling, general and administrative expenses for the quarter ended March 31, 2016 were $20.8 million, as compared with $18.9 million during the same period in 2015. The increase was primarily related to incremental costs associated with hiring and onboarding of Keryx’s expanded field team.

Net loss for the first quarter ended March 31, 2016 was $41.0 million, or $0.39 per share, compared to a net loss of $27.7 million, or $0.28 per share, for the comparable quarter in 2015. The company’s net loss for the quarter ended March 31, 2016 includes $15.7 million in non-cash interest expense related to amortization of the debt discount on its convertible senior notes, as well as a $2.0 million non-cash charge related to the increase in fair value of the derivative liability that was recorded in connection with the issuance of the convertible senior notes.

Cash Operating Expenses (a non-GAAP measurement)*
Total operating expenses (excluding cost of goods sold and license expenses) for the first quarter ended March 31, 2016 were $28.4 million, which included $4.5 million in non-cash expenses, thereby making cash operating expenses $23.9 million for the first quarter. During the same period in 2015, total operating expenses were $28.5 million, which included $4.5 million in non-cash expenses, thereby making cash operating expenses $24.0 million.

Non-cash expenses referenced above include stock-based compensation expense, depreciation expense and certain non-cash commercial expenses, such as product samples.

2016 Financial Guidance
This section contains forward-looking guidance about the financial outlook for Keryx Biopharmaceuticals

Keryx today reiterated the following financial guidance provided in February 2016.

Auryxia net U.S. product sales: Keryx expects full year 2016 Auryxia net U.S. product sales to be in the range of $31 to $34 million, and expects sales to ramp throughout the year, as it realizes the full impact of its expanded field team.

Cash operating expenses: Keryx expects its 2016 cash operating expenses will be in the range of $87 to $92 million. Cash operating expense guidance excludes cost of goods sold, license expenses, and other non-cash expenses.*

* Please refer to the section below titled "Use of Non-GAAP Financial Measures" for information about Keryx’s use of non-GAAP financial measures.

On April 27, 2016 QIAGEN N.V. (NASDAQ: QGEN; Frankfurt Prime Standard: QIA) reported results of operations for the first quarter of 2016, delivering on goals for adjusted net sales and adjusted earnings per share results while reaffirming full-year 2016 targets and announcing plans for a new $100 million share repurchase program (Filing, Q1, QIAGEN, 2016, APR 28, 2016, View Source [SID:1234511598]).

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!

"QIAGEN achieved goals for the first quarter of 2016 while moving ahead on initiatives to accelerate growth and drive further innovation in our Sample to Insight portfolio, which enables customers to gain valuable molecular insights from any biological sample. We are on track to deliver the benefits of these efforts, which include accelerating our performance during the course of 2016 and making targeted investments to enhance our mid- to long-term growth prospects," said Peer M. Schatz, Chief Executive Officer of QIAGEN N.V.

"All regions contributed to QIAGEN’s performance in the first quarter of 2016, fueled by strong single-digit CER growth in Molecular Diagnostics when excluding the expected headwind in U.S. HPV test sales, and better trends among Pharma customers. Our growth drivers grew at a double-digit CER pace and reached 35% of total sales, with the blockbuster QuantiFERON latent TB test providing about 10% of sales and accelerating to above a 25% CER annual growth pace. QIAsymphony automation solutions delivered solid growth in system placements and double-digit CER growth in consumables. We are excited about the early successes of the GeneReader NGS System launch, which surpassed our goal for placements in the first quarter of 2016 amid very positive customer feedback about the benefits of this first truly complete Sample to Insight solution for next-generation sequencing. QIAGEN remains on track to achieve our 2016 goals for higher adjusted net sales and earnings, and for accelerating growth in the coming years."

First quarter 2016 results

Change
In $ millions, except per share information
Q1 2016
Q1 2015
$
CER
Net sales, adjusted
298.4
298.7
0%
+2%
Operating income, adjusted
53.4
67.4
-21%
Net income, adjusted
44.0
51.5
-15%
Diluted EPS, adjusted
$0.19
$0.22
Diluted EPS CER, adjusted
$0.19
$0.22

For information on adjusted figures, please refer to the reconciliation table accompanying this release. Adjusted net sales is a non-GAAP measure that includes all revenue contributions from bioinformatics acquisitions.

Adjusted net sales grew 2% at constant exchange rates (CER) in the first quarter of 2016 compared to the same period in 2015, but were unchanged at actual rates due to two percentage points of adverse currency movements. All regions as well as the Pharma, Molecular Diagnostics and Academia customer classes were higher on growth in consumables and related revenues (+2% CER / 88% of sales) and instruments (+6% CER / 12% of sales). About one percentage point of total CER growth came from the late 2015 acquisition of MO BIO Laboratories Inc., a leader in sample technologies for metagenomics and microbiome analysis, while the rest of the portfolio added about one percentage point. Excluding the expected impact of lower U.S. HPV test sales, which created two percentage points of headwind, adjusted net sales rose 4% CER.

Operating income declined to $15.4 million in the first quarter of 2016 from $35.1 million in 2015. Adjusted operating income, which excludes items such as business integration, acquisition-related costs and the amortization of intangible assets acquired in business combinations, declined 21% to $53.4 million from $67.4 million in the first quarter of 2016. The adjusted operating income margin was 18% of net sales in the first quarter of 2016 compared to 23% in the same period of 2015. The adjusted gross margin declined to 70% of sales from 73% in the year-ago period, impacted by lower gross margins for companion diagnostic partnerships and costs to relocate manufacturing for some products to the operational headquarters site in Hilden, Germany. Sales & Marketing expenses were higher as a percentage of sales to support commercialization of the growth drivers and geographic expansion. Research & Development costs rose slightly as a percentage of sales, and General & Administrative expenses fell as a percentage of sales from the first quarter of 2015.

Net income attributable to owners of QIAGEN N.V. was $14.9 million in the first quarter of 2016, or $0.06 per diluted share (based on 236.9 million diluted shares), compared to $19.5 million, or $0.08 per share (based on 237.4 million diluted shares) in the 2015 quarter. Adjusted net income was down 15% to $44.0 million, or $0.19 per share ($0.19 CER) from $51.5 million, or $0.22 per share.

At March 31, 2016, cash and cash equivalents rose to $355.8 million from $290.0 million at December 31, 2015. Net cash provided by operating activities was $48.7 million in the first quarter of 2016, down from $62.8 million in the year-ago period. Net cash provided by investing activities was $17.7 million compared to $26.8 million. Net cash used in financing activities was $4.0 million compared to $182.3 million in the first quarter of 2015, which included $187.8 million for debt repayment. Free cash flow declined to $30.3 million from $39.7 million.

"We are determined to deliver on the targets set for 2016 while making investments to enhance our mid-term performance, improve profitability and increase cash flows," said Roland Sackers, Chief Financial Officer of QIAGEN N.V. "Our top priority remains to create value, and to do so through disciplined capital allocation. This involves targeted acquisitions such as MO BIO and Enzymatics that complement our Sample to Insight portfolio, as well as share repurchase programs, including our newly announced fourth $100 million program."

Customer class review
An overview of adjusted net sales for the first quarter of 2016, with the MO BIO (December 2015) acquisition contributing to underlying performance in all customer classes for 2016:

Q1 2016
Customer classes
CER change
% of sales
Molecular Diagnostics
+2%
~48%
U.S. HPV sales
-40%
~3%
MDx excluding U.S. HPV sales
+6%
~45%
Applied Testing
-5%
~8%
Pharma
+7%
~21%
Academia
+2%
~23%
Growth rates at constant exchange rates (CER) and sales contributions at actual rates.
Molecular Diagnostics delivered 6% CER growth excluding the expected decline in U.S. HPV test sales, as instrument sales grew at a robust double-digit CER rate, and were complemented by solid single-digit CER gains in consumables and related revenues. Fueled by recent commercial initiatives in the U.S. and Europe, the QuantiFERON-TB test grew over 25% CER and represented about 10% of total QIAGEN sales. Placements of the QIAsymphony automation system under multi-year reagent rental agreements increased as well, with more than one-third of the placements as complete QIAsymphony RGQ systems. Sales of QIAsymphony consumables also rose at a double-digit CER pace, but other consumables sold to this customer group grew more modestly. Personalized Healthcare sales grew at a single-digit CER rate, and included higher revenues from companion diagnostic co-development projects. Global sales of HPV tests fell 26% (6% of total sales) in the first quarter of 2016, as U.S. sales were down 40% (3% of total sales) and sales elsewhere fell at a single-digit CER rate (3% of sales).
Applied Testing faced a tough comparison in the first quarter of 2016 on a combination of steady CER sales of consumables and an approximately 20% CER decline in instrument sales compared to a strong performance in 2015. The Asia-Pacific / Japan region provided growth contributions against declining sales in the Americas and the EMEA regions. QIAGEN expects improving growth trends to emerge in this customer class during 2016.
Pharma advanced at a robust single-digit CER pace for the first quarter of 2016, led by a solid expansion in instrument sales at a double-digit CER pace complemented by mid-single-digit CER growth in consumables and related revenues. All geographic regions contributed to growth over the first quarter of 2015, with the strongest incremental contributions from the EMEA region.
Academia generated growth in the Americas and Asia-Pacific regions compared to the first quarter of 2015, while the EMEA region declined at a single-digit CER rate. Sales of instruments as well as consumables and related revenues grew at modest single-digit CER rates in the first quarter of 2016. Funding trends are expected to improve during the course of 2016 in the U.S. and Europe given recent government decisions to increase spending for life sciences research.

Geographic review

Q1 2016
Region
CER change
% of sales
Americas
+1%
46%
Europe / Middle East / Africa
+7%
34%
Asia-Pacific / Japan
+4%
20%
Growth rates at constant exchange rates (CER) and sales contributions at actual rates.
The EMEA region led the performance with single-digit CER gains in the United Kingdom, France and Germany along with double-digit CER growth in Turkey. The Americas rose 5% CER excluding U.S. HPV test sales, supported by single-digit CER growth in Latin America. Asia-Pacific / Japan benefited from double-digit CER growth in South Korea, China and Australia, while Japan fell at a significant double-digit CER rate. Sales in the top seven emerging markets (Brazil, Russia, India, China, South Korea, Mexico and Turkey) rose 19% CER and provided 13% of sales.
On course to accelerate growth and further innovation

QIAGEN continues to build momentum for its Sample to Insight portfolio, with the growth drivers providing double-digit CER growth and more than one-third of total sales. Among the recent developments:
Commercialization of the GeneReader NGS System, the world’s first complete Sample to Insight solution designed for any laboratory to deliver actionable results from next-generation sequencing, showed strong momentum, as broad demand drove initial placements in the first quarter of 2016. GeneReader is gaining recognition as a highly efficient, user-friendly solution to address fragmented NGS workflows and bottlenecks that have hindered labs from gaining actionable insights from sequencing applications. The novel Price Per Insight (PPI) model provides a cost-effective and reliable way for labs to gain access to this technology. The GeneReader NGS System also has been recognized with a 2016 Red Dot design award.

QuantiFERON-TB Gold (QFT), the modern standard for detecting latent tuberculosis (TB) infection and the top-selling interferon-gamma release assay (IGRA) worldwide, was chosen in two recent national screening guideline processes. South Korea and Taiwan selected QFT for screening at-risk individuals as part of national TB control efforts. Also, the U.S. Preventive Services Task Force (USPSTF) released draft guidelines that would expand screening to patients in primary care settings. The positive draft "B" rating recommended use of the modern and more accurate IGRAs, and also the tuberculin skin test.

QIAGEN’s industry-leading portfolio of liquid biopsy solutions, which use fluids such as blood to detect and profile diseases, continue to gain visibility. Among many recent studies using QIAGEN kits, a report in JAMA Oncology showed the use of QIAamp cell-free DNA extraction kits to achieve promising data for detection of mutations in non-small cell lung cancer (NSCLC).

A new companion diagnostic collaboration was launched in April with Mirati Therapeutics, Inc. to co-develop and commercialize a test to guide the use of a novel compound currently in development for NSCLC patients with cancer-driving alterations of the MET gene. This is the initial project in a new master collaboration agreement with Mirati.

A wide-ranging collaboration with 10x Genomics was announced at the annual Advances in Genome Biology and Technology (AGBT) conference in February. The two companies will combine products to co-develop and co-market NGS and single-cell biology analysis workflows and informatics solutions. These new products will be essential in addressing challenges such as how to analyze long-read sequence data for insights into complex diseases.

More than 170 new QIAseq Targeted RNA Panels were launched during the first quarter of 2016 for gene expression profiling and efficient RNA sequencing with any NGS sequencer. These panels employ a novel proprietary technology to enable highly quantitative output not possible with other NGS approaches and to allow researchers to analyze interactions among genes, cellular phenotypes and disease processes. Data analysis and insights are integrated into the QIAseq panels with comprehensive QIAGEN bioinformatics solutions.

QIAGEN introduced the RNA-seq Explorer Solution, integrating bioinformatics with advanced sample technologies to generate clear insights from liquid biopsies such as exosomes for cancer research. RNA-seq Explorer integrates Ingenuity Pathway Analysis and Biomedical Genomics Workbench together into one solution for the analysis and interpretation of "omics" data to make sense of inherently noisy data from sequencing body fluids.

A conditional voluntary takeover offer was submitted in March to purchase all shares of Exiqon A/S of Denmark, a leader in the emerging market for non-coding RNA (ncRNA) such as microRNA (miRNA) and long non-coding RNA (lncRNA). Exiqon’s portfolio is highly synergistic with several areas of QIAGEN’s portfolio and adds a set of proprietary technologies and know-how, including Locked Nucleic Acid (LNA) technology that improves specificity and sensitivity in PCR, NGS target enrichment and functional assays. The acquisition of Exiqon, which had sales of about $20 million in 2015, is expected to be completed in mid-2016 for about $100 million.

New $100 million plan marks fourth QIAGEN share repurchase program
QIAGEN announced today the launch of its fourth $100 million share repurchase program. This comes after expiry of the third program, under which approximately 3.0 million shares were repurchased on the Frankfurt Stock Exchange at a volume-weighted average price of EUR 19.33 per share for EUR 57 million (approximately $70 million). Details of the fourth repurchase program will be made public in line with Article 4, Section (2) of EC regulation 2273/2003 (so-called Safe Harbor). Repurchased shares are held in treasury to satisfy obligations for exchangeable debt instruments and employee share-based remuneration plans. Further information is available on the QIAGEN website (www.qiagen.com).

2016 outlook
QIAGEN reaffirms its full-year 2016 expectations (announced in January 2016) for adjusted net sales to rise approximately 6% CER from the current portfolio. This includes about one percentage point of growth from the late 2015 acquisition of MO BIO, and approximately one percentage point of headwind from reduced U.S. HPV test sales. Adjusted diluted earnings per share (EPS) at CER are expected to rise approximately in line with sales for the full year to approximately $1.10-1.11 CER. Based on exchange rates as of April 1, 2016, currency movements against the U.S. dollar are expected to have an adverse impact on results at actual rates of approximately two percentage points on full-year 2016 adjusted net sales, and about $0.02 per share on adjusted diluted EPS. These full-year 2016 expectations do not take into account the publicly announced tender offer to acquire the Danish biotechnology company Exiqon A/S (announced in March 2016) or any further acquisitions that could be completed during the year.

For the second quarter of 2016, adjusted net sales are expected to rise approximately 4% CER, which includes approximately two percentage points of headwind from reduced U.S. HPV test sales, and for adjusted EPS of approximately $0.22 CER. Based on exchange rates as of April 1, 2016, QIAGEN expects currency movements to have an adverse impact on results for the second quarter at actual rates of approximately two percentage points on adjusted net sales and about $0.01 per share on adjusted diluted EPS.

Use of adjusted results
QIAGEN reports adjusted results, as well as results on a constant exchange rate (CER) basis, and other non-U.S. GAAP figures (generally accepted accounting principles), to provide additional insight into its performance. These results include adjusted net sales (includes all revenue contributions from bioinformatics acquisitions), adjusted gross profit, adjusted operating income, adjusted net income attributable to owners of QIAGEN N.V., adjusted diluted EPS and free cash flow. Adjusted results are non-GAAP financial measures that QIAGEN believes should be considered in addition to reported results prepared in accordance with GAAP, but should not be considered as a substitute. Free cash flow is calculated by deducting capital expenditures for Property, Plant & Equipment from cash flow from operating activities. QIAGEN believes certain items should be excluded from adjusted results when they are outside of its ongoing core operations, vary significantly from period to period, or affect the comparability of results with its competitors and its own prior periods. Reconciliations are included in the tables accompanying this report.

On April 28, 2016 Abbott (NYSE: ABT) and St. Jude Medical, Inc. reported a definitive agreement for Abbott to acquire St. Jude Medical, creating a premier medical device leader with top positions in high-growth cardiovascular markets, including atrial fibrillation, structural heart and heart failure as well as a leading position in the high-growth neuromodulation market (Press release, Abbott, APR 28, 2016, View Source [SID:1234511542]). Under the agreement, St. Jude Medical shareholders will receive $46.75 in cash and 0.8708 shares of Abbott common stock, representing total consideration of approximately $85 per share. At an Abbott stock price of $43.93(2), this represents a total transaction equity value of $25 billion. The combined company will have an industry-leading pipeline expected to deliver a steady stream of new medical device products across cardiovascular, diabetes, vision and neuromodulation patient care.

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!

St. Jude Medical’s strong positions in heart failure devices, atrial fibrillation and cardiac rhythm management complement Abbott’s leading positions in coronary intervention and transcatheter mitral repair. Together, the company will compete in nearly every area of the cardiovascular market and hold the No. 1 or 2 positions across large and high-growth cardiovascular device markets. This best-in-class combined portfolio will have the depth, breadth and innovation to help patients restore their health, reduce costs for payors and deliver greater value to customers.

"Bringing together these two great companies will create a premier medical device business and immediately advance Abbott’s strategic and competitive position," said Miles D. White, chairman and chief executive officer, Abbott. "The combined business will have a powerful pipeline ready to deliver next-generation medical technologies and offer improved efficiencies for health care systems around the world."

"Today’s announcement is an exciting next chapter for St. Jude Medical, bringing together two industry leaders with a shared passion for innovation, culture and patients," said Michael T. Rousseau, St. Jude Medical president and chief executive officer. "Our combined scale will expand the global reach, competitiveness and impact of our medical device innovation for physicians and hospitals. This transaction provides our shareholders with immediate value and the opportunity to participate in the significant upside potential of the combined organization. I’d like to thank our 18,000 employees whose hard work and commitment help us deliver leading medical technologies to patients around the world."

The acquisition of St. Jude Medical will advance Abbott’s strategic and competitive positions:

Aligned with healthcare and demographic trends: Cardiovascular medical devices are important tools to address the growing health and economic burden of cardiovascular disease (CVD). In the U.S. alone, more than 40 percent of adults are expected to have one or more forms of CVD by 2030. The combined business will have one of the broadest portfolios of devices and an industry-leading pipeline to help healthcare systems provide better care for patients while increasing efficiencies and reducing costs.

Leadership positions in core businesses: With combined annual sales of approximately $8.7 billion, Abbott’s cardiovascular business and St. Jude Medical will hold the No. 1 or 2 positions across large and high-growth cardiovascular device markets and will compete in nearly every area of the market – with an aggregate market opportunity of $30 billion.

Well-managed diversity to deliver reliable, sustainable growth: St. Jude Medical further diversifies and enhances sources of future growth for Abbott – the combined pipelines are expected to bring numerous new medical device products to key markets this year, including:

St. Jude Medical’s EnSite Precision next-generation cardiac mapping system used to visualize and navigate catheters in the heart during ablation procedures; first-to-market MultiPoint Pacing technology advances quadripolar technology and provides additional options for cardiac resynchronization therapy patients who are not responsive to other pacing options; Proclaim Elite recharge-free Spinal Cord Stimulation System and Prodigy Chronic Pain System, which are used for treating chronic pain and are MRI safe, upgradeable, and feature its proprietary Burst technology.
Abbott’s FreeStyle Libre, a sensor-based glucose monitoring system for people with diabetes that eliminates routine finger sticks; Tecnis Symfony, a first-in-kind continuous range of vision intraocular lens for the treatment of people with cataracts; and Absorb, the world’s first bioresorbable coronary stent.
Strong positions in the world’s largest and fastest-growing geographies: St. Jude Medical has strong and leading positions around the world, strengthening Abbott’s global scale, infrastructure and capabilities.

Financial Impact of Transaction
The acquisition of St. Jude Medical is expected to be accretive to Abbott’s adjusted earnings per share in the first full year after closing and increasing thereafter, with approximately 21 cents of accretion in 2017 and 29 cents in 2018.(1) The combination is anticipated to result in annual pre-tax synergies of $500 million by 2020, including both sales and operational benefits. One-time deal-related costs and integration costs will be provided at a future date.

St. Jude Medical’s net debt of approximately $5.7 billion will be assumed or refinanced by Abbott. Abbott intends to fund the cash portion of this transaction with medium- and long-term debt.

The transaction, which has been approved by the boards of directors of St. Jude Medical and Abbott, is subject to the approval of St. Jude Medical shareholders and the satisfaction of customary closing conditions, including specified regulatory approvals. The transaction is expected to close in the fourth quarter of 2016.

Separate Equity Issuance to Balance Capital Structure
Separately, Abbott expects to issue $3 billion of common stock in the secondary market to rebalance its capital structure, with timing to be determined.

Financing for the St. Jude Medical transaction and the previously announced Alere Inc. acquisition contemplates financing capacity to close both transactions.

These transactions are expected to be immediately accretive to adjusted earnings per share(1), as shown below:

Increase / (Decrease)

Adjusted Earnings Per Share*

2017

2018
Alere (per news release 2/1/16)
$0.12-0.13

$0.20
St. Jude Medical
$0.21

$0.29
Issuance of Abbott Common Stock
($0.07)

($0.10)
The separate issuance of equity to the market is not a condition to the completion of either the St. Jude Medical transaction or the Alere transaction. Abbott has obtained a commitment letter from BofA Merrill Lynch for the full cash portion of the consideration for both transactions.

Advisors
Evercore is serving as the lead financial advisor for Abbott with Wachtell, Lipton, Rosen & Katz serving as legal counsel. BofA Merrill Lynch will be providing financing and also is serving as a financial advisor to Abbott. Guggenheim Securities is acting as financial advisor and Gibson, Dunn & Crutcher LLP is serving as legal counsel to St. Jude Medical.

On April 28, 2016 Provectus Biopharmaceuticals, Inc. (NYSE MKT: PVCT, www.pvct.com), a clinical-stage oncology and dermatology biopharmaceutical company ("Provectus" or "The Company"), reported that two abstracts related to research into IL PV-10 for treatment for melanoma have been published in a special issue of the ANZ Journal of Surgery detailing the Royal Australasian College of Surgeons 85th Annual Scientific Congress, 2–6 May 2016, in Queensland, Australia (Filing, 8-K, Provectus Pharmaceuticals, APR 28, 2016, View Source [SID:1234511549]).

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 abstract, titled "Intralesional PV-10 for In-Transit Melanoma – A Single Centre Experience," notes that "Intralesional PV-10 has been used at Peter MacCallum Cancer Centre since 2010, and the current report presents a retrospective analysis of patient outcomes, reporting the response rates, durability of responses and observed toxicities."

The Peter MacCallum Cancer Centre, in East Melbourne, Victoria, Australia, is Australia’s only public hospital solely dedicated to cancer treatment, research and education. The abstract was authored by Jocelyn Lippey et al. and examined data from nineteen patients receiving PV-10 at the center.

The second abstract, titled "Intralesional PV-10 Chemoablation Therapy for the Treatment of Cutaneous Melanoma Metastases – Results of a Prospective, Non-Randomised, Single Centre Study," summarizes work done at the Princess Alexandra Hospital in Brisbane, Queensland, Australia. The authors, Tavis Read et al., set out "to assess the clinical efficacy and treatment outcomes of patients receiving intralesional (IL) PV-10 chemoablation therapy for the treatment of cutaneous melanoma metastases." This report examined data from forty five patients receiving PV-10 at the hospital.

For more information about the special issue of the ANZ Journal of Surgery where the abstracts appear, visit View Source ("Abstract Journal for Surgical Oncology," pages 157-160) or View Source (abstracts SO006 and SO007).
For more information about the RACS Annual Scientific Congress, visit: View Source

On April 28, 2016 The PharmaMar Group reported 42.1 million euro in total revenues in the first quarter of 2016, of which 40 million euro were group net sales, 16% more than in the same period of 2015 (Press release, PharmaMar, APR 28, 2016, View Source [SID:1234511555]).

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!

Both the Biopharmaceutical and Consumer Chemicals divisions increased revenues in the quarter. Biopharmaceutical net sales amounted to 24.7 million euro, a 15% increase year-on-year. Of that figure, 22.8 million euro was net sales of Yondelis in the territories where PharmaMar is leads commercialisation. That was a 15% increase over the same period of 2015 and the highest quarterly sales of Yondelis since the drug was launched.

The Consumer Chemicals area reported 15.8 million euro in revenues in the period, an 18% increase year-on-year.
Other revenues in the first quarter included 1.8 million euro in royalties on Yondelis.
The schedule of milestone payments under the 2011 coordination agreement with Janssen L.P. concluded in 2015, and no revenues were recognised under this heading in 2016. Janssen L.P, launched Yondelis late in 2015 in the US following FDA approval and PharmaMar will begin to collect additional royalties on sales in the US.

Research and development expenditure continued to increase in 2016. The advanced status of the product pipeline and the fact that there are Phase III trials are under way or about to commence requires that the sizeable R&D expenditure of previous years be continued in 2016. Total spending on R&D and innovation 2 amounted to 18.7 million euro in the first quarter, compared with 12.6 million euro (net) in the same period of 2015.

This increase in R&D and innovation expenditure and the conclusion of the milestone payments resulted in group EBITDA being negative in the amount of -3.9 million euro, down from a positive 9.5 million euro in the first quarter of 2015, which included a milestone payment of 10 million dollars (8.8 million euro).

As a result, the Group reported an attributable net loss of -7.1 million euro (vs. +6.5 million euro in 1Q15).