On February 28, 2017 Valeant Pharmaceuticals International, Inc. (NYSE: VRX) (TSX: VRX) ("Valeant" or the "Company" or "We") reported fourth quarter and full year 2016 financial results (Filing, Q4/Annual, Valeant, 2016, FEB 28, 2017, View Source [SID1234517994]).

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"Today, we announced financial results that delivered on expectations and demonstrated our commitment to creating the new Valeant," said Joseph C. Papa, Chairman and Chief Executive Officer. "Over the past few months, our teams worked to stabilize and strengthen our core businesses, resolve legacy issues, improve operational processes, launch new products, and improve the balance sheet and capital structure. We paid all 2017 amortizations and reduced debt by $519 million in the fourth quarter. We agreed to divest a number of assets, including several skincare brands, our Dendreon business and smaller international interests. The U.S. Food and Drug Administration (FDA) approved our new psoriasis treatment, SILIQ, and we resubmitted our glaucoma treatment, latanoprostene bunod in February 2017.

"Bill Humphries recently joined our Dermatology business as Executive Vice President and we believe he has the talent and experience to grow the business. With our Walgreens fulfillment arrangement, we continue to see improvements in average sales prices (ASP) that are encouraging to us. We have worked to stabilize our sales force, while also expanding it to include primary care physicians to help us reach patients whose lives we believe can be improved with our healthcare products. We are pleased to report that the remediation at the Bausch + Lomb manufacturing site in Tampa was recently completed. Now, more than ever, we believe that with the right people, products and processes in place, we are well poised for a turnaround in 2017; we have a lot to look forward to and are excited about the future."

Total Revenues
Total Revenues in the fourth quarter of 2016 were $2,403 million as compared to $2,758 million in the fourth quarter of 2015, reflecting a decline of 13%. The decrease was primarily driven by a reduction in product sales from the existing business (excluding effects from acquisitions, foreign currency and divestitures and discontinuations) of $310 million and the negative impact of foreign currency exchange of $43 million, most notably from the Egyptian pound, which was significantly devalued in November 2016. Revenues in the quarter were further impacted by a drop in realized pricing by 3%, along with divestitures and discontinuations of $16 million. These declines were partially offset by incremental product sales of $13 million from acquisitions.

Total Revenues for the full year 2016 were $9,674 million as compared to $10,447 million for 2015, reflecting a decrease of 7%. The decrease was primarily driven by a decline in product sales from our existing business (excluding effects from acquisitions, foreign currency and divestitures and discontinuations) of $1,277 million, the unfavorable impact of foreign currencies on our existing business of $137 million, the impact of divestitures and discontinuations of $80 million, and a decline in other revenues of $15 million. These decreases were offset by incremental product sales of $735 million from acquisitions.

Segment Revenues
The Bausch + Lomb / International Segment
The Bausch + Lomb/International segment reported fourth quarter 2016 revenues of $1,176 million as compared to $1,187 million in the fourth quarter of 2015. Fourth quarter results reflected incremental revenue gains and slight volume increases from the U.S. Consumer business and Asia Pacific region that were offset by declines in other business units within the segment, as well as by the negative impact of foreign exchange.

Full year 2016 revenues in the Bausch + Lomb/International segment were $4,607 million as compared to $4,603 million for 2015. The segment, which contributed 48% of total company revenues in 2016, reflected product sales of $239 million from acquisitions in 2015, a net increase in product sales revenue from our existing businesses (excluding effects from acquisitions, foreign currency, and divestitures and discontinuations), driven by volume of $31 million.

Increased volumes driven by gains in U.S. Consumer and China were partially offset by declines in Europe resulting from our targeted inventory reductions in Poland and Russia.

During 2016, the segment was also impacted by the unfavorable impact of foreign currencies of $126 million, a net decrease in product sales revenue from our existing business driven by a decrease in average realized pricing of $98 million and a negative impact from divestitures and discontinuations of $36 million.

The Branded Rx Segment
The Branded Rx segment delivered fourth quarter 2016 revenues of $829 million as compared to $1,002 million in the fourth quarter of 2015. The shortfall in quarterly revenues as compared to the same period in the prior year was due to declines driven mainly by our Salix and Dermatology business. Results in the quarter also reflected lower average realized pricing impacted by managed care rebates, and increased generic competition.

Full year 2016 revenues in the Branded Rx segment were $3,148 million as compared to $3,582 million for 2015. The segment, which contributed 33% of total company revenues in 2016, reflected a decline in product sales revenue from our existing business, driven by a decrease in average realized pricing of $431 million and a decrease in volume of $357 million. These factors were partially offset by product revenues of $383 million from acquisitions in 2015, primarily the acquisition of Salix Pharmaceuticals, Ltd. (the "Salix Acquisition") and the acquisition of certain assets of Dendreon Corporation.

The decrease in average realized pricing was primarily attributable to higher managed care rebates and lower price appreciation credits particularly in the Dermatology and Salix businesses, and the fulfillment arrangement with Walgreens. The decrease in volumes was driven by the Dermatology business, most notably by Jublia, Solodyn and Ziana, which have experienced lower volumes since the change in our fulfillment model. Generic competition was also a factor in volume declines as certain products lost exclusivity, such as Glumetza and Zegerid in our Salix business unit and Ziana in our Dermatology business unit.

During 2016, the segment was also impacted by a decrease associated with divestitures and discontinuations of $22 million and the unfavorable impact of foreign currencies on our existing Canadian business of $11 million.

The U.S. Diversified Products Segment
The U.S. Diversified Products segment reported fourth quarter 2016 revenues of $398 million as compared to $568 million in the fourth quarter of 2015. The shortfall in quarterly revenues as compared to the prior year was primarily driven by lower volumes in Neurology. Results in the quarter also reflected declines in average realized pricing as a result of higher managed care rebates, as well as increased generic competition.

Full year 2016 revenues for the U.S. Diversified Products segment were $1,919 million as compared to $2,262 million for 2015. The segment, which contributed 19% of total company revenues in 2016, reflected a decline in product sales revenue from our existing business of $422 million, primarily driven by a decrease in volume of $299 million, and a decrease in average realized pricing of $123 million. These factors were partially offset by incremental product sales revenue in 2016, related to the 2015 acquisition of certain assets of Marathon Pharmaceuticals, LLC (mainly driven by Isuprel and Nitropress product sales) and other acquisitions of $113 million.

The decrease in volume was mainly driven by generic competition to our Neurology products (Xenazine, Mestinon, Ammonul and Sodium Edecrin). The decrease in average realized pricing was attributable to our Neurology products and is the result of higher managed care rebates, lower price appreciation credits, and higher group purchasing organization chargebacks on Nitropress and Isuprel. The segment was also affected by a decrease in contribution associated with divestitures and discontinuations of $22 million.

Operating Expenses
Cost of Goods Sold (COGS)
Total GAAP COGS was $665 million for the fourth quarter 2016 as compared to $730 million in the fourth quarter of 2015. Full year 2016 total GAAP COGS was $2,611 million as compared to $2,585 million for 2015.
As a percentage of total revenues, GAAP COGS was 28% in the fourth quarter of 2016, as compared to 26% in the same period in 2015, an increase of 2%. Full year 2016 GAAP COGS as a percentage of total revenues came in at 27% as compared to 25% in 2015, an increase of 2%.
Adjusted COGS (non-GAAP) for the fourth quarter came in at $666 million as compared to $672 million in 2015. Full year 2016 Adjusted COGS (non-GAAP) were $2,557 million as compared to $2,402 million for 2015, an increase of $155 million, or 6%.
As a percentage of total revenues, Adjusted COGS (non-GAAP) was 28% in the fourth quarter of 2016, as compared to 24% in the same period in 2015, an increase of 4%. Full year 2016 Adjusted COGS (non-GAAP) as a percentage of total revenues were 26% as compared to 23% in 2015, an increase of 3%.
For both GAAP COGS and Adjusted COGS (non-GAAP), the increase in year-over-year expenses, as a percentage of total revenues, was primarily driven by a decrease in average realized pricing across all of our segments. The increase was also attributable to an unfavorable change in product mix, as, in 2016, a greater percentage of our revenue was attributable to the Bausch + Lomb/International segment, which generally has lower gross margins than the balance of the Company’s product portfolio.
These increases were partially offset by lower acquisition accounting related adjustments to inventory expensed in 2015, primarily related to the fair value step-up in inventories acquired in the Salix Acquisition and other acquisitions.
Selling, General and Administrative (SG&A)
Total GAAP SG&A was $665 million for the fourth quarter of 2016 as compared to $743 million in the fourth quarter of 2015. Full year 2016 total GAAP SG&A was $2,810 million as compared to $2,700 million for 2015.
As a percentage of total revenues, GAAP SG&A was 28% in the fourth quarter of 2016, as compared to 27% in the same period in 2015, an increase of 1%. Full year 2016 GAAP SG&A as a percentage of total revenues were 29% as compared to 26% in 2015, an increase of 3%.
Adjusted SG&A (non-GAAP) expenses in the fourth quarter of 2016 came in at $658 million as compared to $682 million in the fourth quarter of 2015. Full year 2016 Adjusted SG&A (non-GAAP) was $2,698 million as compared to $2,611 million for 2015.
As a percentage of total revenues, Adjusted SG&A (non-GAAP) was 27% in the fourth quarter of 2016, as compared to 25% in the same period in 2015, an increase of 2%. Full year 2016 Adjusted SG&A (non-GAAP) as a percentage of total revenues were 28% as compared to 25% in 2015, an increase of 3%.
For both GAAP SG&A and Adjusted SG&A (non-GAAP), the increase in expenses, as a percentage of total revenues, were primarily driven by expenses related to acquisitions, severance payments to former employees as well as fees related to the recruiting and on boarding of new staff. The increase also reflected professional fees in connection with recent legal and governmental proceedings, investigations and information requests relating to, among other matters, our distribution, marketing, pricing, disclosure and accounting practices, and increases in legal and professional fees in connection with ongoing corporate and business matters.
These factors were partially offset by a net decrease in advertising and selling expenses, primarily driven by decreases in promotion and advertising in our Dermatology and Salix businesses and partially offset by an increase to our reserve for sales returns and allowances recorded in the fourth quarter.
Research and Development (R&D)
Total GAAP R&D was $93 million for the fourth quarter of 2016 as compared to $95 million in the fourth quarter of 2015. Full year 2016 total GAAP R&D was $421 million as compared to $334 million for 2015.
As a percentage of total revenues, GAAP R&D was 4% in the fourth quarter of 2016, as compared to 3% in the same period in 2015, an increase of 1%. Full year 2016 GAAP R&D as a percentage of total revenues were 4% as compared to 3% in 2015, an increase of 1%.
Adjusted R&D (non-GAAP) expenses for the fourth quarter of 2016 were $93 million as compared to $95 million in the fourth quarter of 2015. Full year 2016 Adjusted R&D (non-GAAP) expenses were $404 million as compared to $333 million for 2015.
As a percentage of total revenues, Adjusted R&D (non-GAAP) was 4% in the fourth quarter of 2016, as compared to 3% in the same period in 2015, an increase of 1%. Full year 2016 Adjusted R&D (non-GAAP) as a percentage of total revenues were 4% as compared to 3% in 2015, an increase of 1%.
For both GAAP R&D and Adjusted R&D (non-GAAP), the year-over-year increases in expenses, as a percentage of total revenues, was driven by our focus to maximize the value of our core segments. To bring out additional value in our core Branded Rx segment, we dedicated additional resources to enhance our Dermatology and Gastrointestinal (GI) portfolios. To bring out additional value in our core Bausch + Lomb/International segment, we dedicated additional resources to enhance our eye health and vision care portfolios.
GAAP Operating Income (Loss)
Operating income for the fourth quarter of 2016 was $151 million as compared to $168 million for the fourth quarter of 2015. Fourth quarter operating income reflected a decrease in contribution margin as a result of the decline in product sales from the existing business, the unfavorable impact of foreign currency, net incremental goodwill impairment charges, and the impact of divestitures and discontinuations.
Full year 2016 operating loss was $566 million as compared to operating income for 2015 of $1,527 million, a decrease of $2,093 million. Full year 2016 results reflected a decrease in contribution from our existing business, which was partially offset by incremental contribution from acquisitions. Operating income was further impacted in 2016 by an increase in SG&A and R&D expenses, an increase in amortization of intangible assets and goodwill impairments, a decrease in restructuring and integration costs, a decrease in in-process R&D costs and post-combination expenses.
GAAP Net Income (Loss)
Net loss for the fourth quarter of 2016 was $(515) million as compared to a net loss of $(385) million in the fourth quarter of 2015, an increase of $130 million. In addition to the increase in our operating loss of $17 million, the increase in Net loss was primarily driven by increases in interest expense of $34 million, foreign exchange loss and other of $43 million, and provisions for income taxes of $33 million.
For full year 2016, Net loss was $2,409 million as compared to $292 million in 2015, an increase of $2,120 million. The increase is primarily attributable to the increase in loss before income taxes of $2,280 million. The 2016 net loss includes a recovery of income taxes of $27 million while the 2015 net loss includes a provision for income taxes of $133 million.
Adjusted EBITDA(non-GAAP)
Adjusted EBITDA (non-GAAP) for the fourth quarter of 2016 came in at $1,045 million as compared to $1,374 million for the fourth quarter of 2015. Full year 2016 Adjusted EBITDA (non-GAAP) was $4,305 million as compared to $5,369 million in 2015.
Adjusted Net Income (non-GAAP)
Adjusted net income (non-GAAP) in the fourth quarter of 2016 was $441 million as compared to $542 million in the fourth quarter of 2015. Full year 2016 Adjusted net income (non-GAAP) was $1,916 million as compared to $2,841 million in 2015.
GAAP Earnings Per Share (EPS)
GAAP EPS for the fourth quarter of 2016 came in at $(1.47) as compared to $(1.12) in the fourth quarter of 2015. Full year 2016 GAAP EPS were $(6.94) as compared to $(0.85) for 2015.
Adjusted EPS (non-GAAP)
Adjusted EPS (non-GAAP) for the fourth quarter of 2016 came in at $1.26 as compared to $1.55 in the fourth quarter of 2015. Full year 2016 Adjusted EPS (non-GAAP) were $5.47 as compared to $8.14 for 2015.
GAAP Cash Flow from Operations
Net cash provided by operating activities for the fourth quarter of 2016 was $513 million as compared to $598 million for the fourth quarter of 2015, reflecting a decline of 14%. The decrease was primarily driven by the decrease in contribution margin as a result of the decline in product sales from our existing business partially offset by lower cash operating expenses.
Full year 2016 net cash provided by operating activities was $2,087 million as compared to $2,257 million in 2015 respectively, reflecting a decline of 8%. The decrease was primarily driven by lower operating cash flows generated from our existing business primarily attributable to a decrease in contribution in the Branded Rx segment and the U.S. Diversified segment and was primarily attributable to lower average realized pricing and lower volumes from our existing business of $652 million and $625 million, respectively, which was partially offset by incremental product sales from acquisitions of $735 million.
Results were further impacted by an increase in interest paid of $449 million due to higher borrowings, primarily resulting from the issuances of debt in connection with the Salix Acquisition and an increase in interest rates applicable to our term loans and borrowings under our revolving credit facility under our senior secured credit facilities as a result of amendments in 2016.

2017 Full Year Guidance:
Valeant has provided guidance for 2017 as follows:
GAAP Total Revenues in the range $8.90 billion – $9.10 billion,
Adjusted EBITDA (non-GAAP) in the range of $3.55 billion – $3.70 billion
Other than with respect to GAAP Total Revenues, the Company only provides guidance on a non-GAAP basis. The Company does not provide a reconciliation of forward-looking Adjusted EBITDA (non-GAAP) to GAAP net income (loss), due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. In periods where there are not expected to be significant acquisitions or divestitures, the Company believes it might have a basis for forecasting the GAAP equivalent for certain costs, such as amortization, that would otherwise be treated as non-GAAP to calculate projected GAAP net income (loss). However, because other deductions (such as restructuring, gain or loss on extinguishment of debt and litigation settlements) used to calculate projected net income (loss) vary dramatically based on actual events, the Company is not able to forecast on a GAAP basis with reasonable certainty all deductions needed in order to provide a GAAP calculation of projected net income (loss) at this time. The amounts of these deductions may be material and, therefore, could result in projected GAAP net income (loss) being materially less than projected Adjusted EBITDA (non-GAAP). The Company is no longer providing guidance with respect to Adjusted Net Income or Adjusted EPS.

On March 1, 2017 Takara Bio USA Holdings, Inc. ("TBUSH") reported that it has completed the acquisition of WaferGen Bio-systems, Inc. ("WaferGen"), WaferGen has become a wholly-owned subsidiary of TBUSH as of February 28, 2017 (US local time) (Press release, Takara Bio, FEB 28, 2017, View Source [SID1234518026]).

Under the merger agreement executed with WaferGen, TBUSH paid 35.9 million US dollars to acquire 100% of the equity in WaferGen. TBUSH is a wholly owned subsidiary of Takara Bio Inc. ("Takara Bio"), a leading global biotechnology and life science company headquartered in Shiga, Japan. Takara Bio USA, Inc. ("TBUSA", formerly known as Clontech Laboratories, Inc.) is a wholly owned subsidiary of TBUSH, and both TBUSA and TBUSH are part of the global Takara Bio Group. The impact of the acquisition on Takara Bio Inc.’s financial results in 2017 will be immaterial.

The Takara Bio Group provides a wide range of life science products and services under the Takara, Clontech, and Cellartis brands that assist discovery, translational, and clinical scientists in the advancement of their work. The WaferGen acquisition will allow the Takara Bio Group to augment and expand its worldwide commercial offerings in transcriptomics and create new market opportunities in other area of genomics.

"We are pleased to announce the completion of this transaction and officially welcome WaferGen to the Takara Bio Group," said Carol Lou, President, TBUSA. "We are excited about the synergy between WaferGen’s technologies and products for isolation and processing of single cells and our RNA-seq and T-Cell Receptor (TCR) profiling technologies. WaferGen’s technologies are highly complementary to our reagent portfolio and the combination presents new opportunities for us in genetic analysis including clinical and applied markets."

Recently (January 2017), TBUSH announced the acquisition of Rubicon Genomics, Inc. The combined acquisitions of WaferGen and Rubicon Genomics are synergistic and will allow the Takara Bio Group to provide the exciting benefits of the combined portfolios to the life science community.

Advisors
GCA Advisors, LLC was exclusive financial advisor to TBUSH and Torreya Partners, LLC was exclusive financial advisor to WaferGen. Morrison & Foerster LLP acted as legal counsel to TBUSH while K&L Gates LLP acted as legal counsel for WaferGen.

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On February 28, 2017 MacroGenics, Inc. (NASDAQ:MGNX), a clinical-stage biopharmaceutical company focused on discovering and developing innovative monoclonal antibody-based therapeutics for the treatment of cancer, as well as autoimmune disorders and infectious diseases, reported a corporate progress update and reported financial results for the year ended December 31, 2016 (Press release, MacroGenics, FEB 28, 2017, View Source [SID1234517890]).

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"MacroGenics continues to advance its broad pipeline of clinical compounds, including those in our HER2, B7-H3 and PD-1 franchises as well as the many bispecific product candidates based on our DART platform," said Scott Koenig, M.D., Ph.D., President and CEO of MacroGenics. "Across our portfolio of proprietary antibody and DART-based oncology programs, we now have initial evidence of on-target engagement, manageable safety and anti-tumor activity. In addition, I am very encouraged by the biological activity observed in subjects treated with MacroGenics’ autoimmune DART molecule, MGD010. We will continue to advance our robust pipeline in 2017, including defining future development strategies for multiple programs based on data expected later this year."

Pipeline Updates

Margetuximab. Recent highlights related to the Company’s Fc-optimized monoclonal antibody that targets the human epidermal growth factor receptor 2, or HER2, include:

Phase 3 Metastatic Breast Cancer Study. The pivotal SOPHIA study is evaluating the efficacy of margetuximab plus chemotherapy compared to trastuzumab plus chemotherapy in approximately 530 relapsed/refractory HER2-positive metastatic breast cancer patients. MacroGenics continues to expect to complete enrollment of this study by late 2018. In addition, in consultation with the U.S. Food and Drug Administration (FDA) and the Committee for Medicinal Products for Human Use of the European Medicines Agency, the patient population eligible for participation in SOPHIA has been further expanded to include ado-trastuzumab emtansine-naïve patients.
Phase 2 Gastric Cancer Study. The Company continues to enroll advanced HER2-positive gastric and gastroesophageal junction cancer patients in its combination study of margetuximab with an anti-PD-1 antibody. Preliminary data from the dose escalation portion of the study, including patients with objective response following progression on previous lines of treatment with trastuzumab and chemotherapy, was presented at the Company’s R&D Day in December 2016. MacroGenics expects to complete enrollment of this study in 2017.
B7-H3 Franchise. MacroGenics is developing a portfolio of therapeutics that target B7-H3, a member of the B7 family of molecules involved in immune regulation. The Company is advancing multiple programs that target B7-H3 through complementary mechanisms of action that take advantage of this antigen’s broad expression across multiple solid tumor types. These molecules include:

Enoblituzumab: The Company continues to recruit patients in multiple ongoing studies of enoblituzumab, an Fc-optimized monoclonal antibody that targets B7-H3. These studies include one monotherapy study expanded to include additional bladder and prostate cancer cohorts and two combination studies with either an anti-CTLA-4 mAb (ipilimumab) or anti-PD-1 mAb (pembrolizumab). In addition, two monotherapy Phase 1 studies were recently initiated: a study for children with various solid tumors, including neuroblastoma, and an investigator-sponsored study in men with localized intermediate and high-risk prostate cancer in the neoadjuvant setting.
MGD009: This DART molecule targeting B7-H3 and CD3 is being evaluated in a Phase 1 study across multiple solid tumor types. Adverse events have been manageable to date and initial signs of antitumor activity have been observed, as previously disclosed at the Company’s R&D Day in December 2016. The Company expects to establish the dose and schedule for MGD009 administration as well as initiate dose expansion cohorts in 2017.
MGC018: The Company is conducting Investigational New Drug (IND)-enabling activities to support an IND application for this anti-B7-H3 antibody drug conjugate (ADC) in 2018. The Company will feature a poster presentation on MGC018 at the upcoming American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting in April.
PD-1-Directed Immuno-Oncology Franchise. MacroGenics is advancing several PD-1-directed programs, which will enable both a broad set of combination opportunities across the Company’s portfolio and provide further differentiation from existing PD-1-based treatment options. The first of these are:

MGA012. The Company’s Phase 1 clinical study of its proprietary anti-PD-1 monoclonal antibody was initiated in November 2016. With anti-PD-1 therapy becoming a mainstay of cancer treatment across multiple tumor types, MacroGenics believes MGA012 will be the basis for combination therapy with several of the molecules in its pipeline.
MGD013. MacroGenics is developing the DART molecule, MGD013, to provide co-blockade of two immune checkpoint molecules expressed on T cells, PD-1 and LAG-3, for the potential treatment of a range of malignancies. The Company has completed IND-enabling studies and plans to submit an IND for MGD013 in the first half of 2017.
Additional DART Clinical Programs. Additional DART molecules in Phase 1 clinical development include flotetuzumab (CD123 x CD3, also known as MGD006 and S80880); MGD007 (gpA33 x CD3); MGD010 (CD32B x CD79B); duvortuxizumab (CD19 x CD3, also known as MGD011), which is being developed by Janssen; and PF-06671008 (P-cadherin x CD3), which is being developed by Pfizer. At its R&D Day in December 2016, MacroGenics provided an in-depth update on its portfolio of proprietary, clinical DART programs. The Company highlighted the promising features of these DART molecules, including on-target engagement, manageable safety as well as preliminary evidence of biological activity. Updates on three of these programs for which MacroGenics leads development include:

Flotetuzumab. MacroGenics continues to recruit patients with acute myeloid leukemia (AML) or myelodysplastic syndrome (MDS) in the U.S. and Europe in the Phase 1 study of flotetuzumab. The Company expects to establish the dose and schedule as well as initiate dose expansion cohorts for this study in 2017. In late 2016, the FDA granted orphan drug designation to flotetuzumab for the treatment of AML.
MGD007. MacroGenics continues to recruit patients with colorectal cancer in the Phase 1 study of MGD007. The Company expects to establish the dose and schedule for this study in 2017.
MGD010. During the fourth quarter of 2016, MacroGenics completed the Phase 1 study of MGD010 in healthy subjects. This DART molecule is being developed for the potential treatment of autoimmune disorders. The Company plans to report updated clinical pharmacodynamic activity results from this study in 2017.
Corporate Update

New Board Members: In January 2017, MacroGenics announced the expansion of its Board of Directors from six to eight members and the appointments of Karen J. Ferrante, M.D., and Scott Jackson to fill the newly created vacancies. Dr. Ferrante, a hematologist-oncologist, most recently served as Chief Medical Officer and Head of Research and Development at Tokai Pharmaceuticals. Mr. Jackson served as Chief Executive Officer and as a member of the Board of Directors of Celator Pharmaceuticals, Inc. until its acquisition in July 2016.
Commenced Build-out of GMP Manufacturing Suite: In January 2017, the Company began the expansion of its manufacturing capacity by commencing the construction of a GMP suite in its headquarters building in Rockville, MD to support larger-scale clinical and commercial manufacturing.
2016 Financial Results and Cash Runway Guidance

Cash Position: Cash, cash equivalents and marketable securities as of December 31, 2016, were $285.0 million, compared to $339.0 million as of December 31, 2015.
Revenue: Total revenue, consisting primarily of revenue from collaborative agreements, was $91.9 million for the year ended December 31, 2016, compared to $100.9 million for the year ended December 31, 2015. Revenue from collaborative agreements includes the recognition of deferred revenue from payments received in previous periods as well as payments received during the year.
R&D Expenses: Research and development expenses were $122.1 million for the year ended December 31, 2016, compared to $98.3 million for the year ended December 31, 2015. This increase was due primarily to increased activity in the Company’s preclinical immune checkpoint programs, including MGD013 and MGA012, MGD014 (funded by NIAID/NIH) and the initiation of two Phase 1 clinical trials combining enoblituzumab with other compounds. These increases were partially offset by decreased manufacturing costs for margetuximab.
G&A Expenses: General and administrative expenses were $29.8 million for the year ended December 31, 2016, compared to $22.8 million for the year ended December 31, 2015. This increase was primarily due to increased staff, recruiting costs and stock-based (non-cash) compensation expense and patent expense.
Net Loss: Net loss was $58.5 million for the year ended December 31, 2016, compared to net loss of $20.1 million for the year ended December 31, 2015.
Shares Outstanding: Shares outstanding as of December 31, 2016 were 34,870,607.
Cash Runway Guidance: MacroGenics expects that its current cash, cash equivalents and marketable securities, combined with anticipated funding under its current strategic collaborations, should fund the Company’s operations through late 2018.

On February 28, 2017 Ligand Pharmaceuticals Incorporated (NASDAQ: LGND) reported that it has expanded its license with Sermonix Pharmaceuticals to include worldwide rights to develop and commercialize oral lasofoxifene. Ligand originally licensed the U.S. rights to oral lasofoxifene to Sermonix in February of 2015, and has now expanded the agreement to include the rest of the world (Press release, Ligand, FEB 28, 2017, View Source [SID1234532255]). Sermonix is focused on breast and ovarian cancer treatment with oral lasofoxifene, particularly an indication in the treatment of advanced Estrogen Receptor positive (ER+) endocrine-resistant breast cancer.

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"Lasofoxifene is an asset with a rich heritage originating at Ligand and with a substantial set of global clinical data. This agreement with Sermonix represents an expansion of our relationship and enables further development of oral lasofoxifene on a worldwide basis," said John Higgins, Chief Executive Officer of Ligand Pharmaceuticals. "This amendment includes an upfront payment, additional commercial milestones and 6% to 10% royalties on ex-US sales and is consistent with our shots-on-goal business model of partnering the development of our assets to create a robust pipeline with limited required R&D spending by Ligand."

About Lasofoxifene and Ligand’s Lasofoxifene Partnerships

Lasofoxifene was discovered through a research collaboration between Ligand and Pfizer that began in 1991. The oral, 0.5 mg form of lasofoxifene tartrate was developed by Pfizer under the trade name Fablyn, and progressed through regulatory approval in the EU. After Pfizer acquired Wyeth and its drug Conbriza (bazedoxifene), a similar SERM program, rights to all forms of lasofoxifene reverted to Ligand in 2011. In 2013 Ligand licensed lasofoxifene to Azure Biotech for the development of a novel formulation targeting an underserved market in women’s health. Also in 2013, Ligand licensed to Ethicor Pharmaceuticals Ltd rights to manufacture and distribute oral lasofoxifene as an unlicensed medicinal product in the European Economic Area, Switzerland and the Indian Subcontinent. Ligand and Ethicor mutually terminated that agreement in early 2017.

On February 28, 2017 Sigma-Tau Pharmaceuticals, Inc., a leader in the development and commercialization of medicines for patients with rare diseases, reported that the company has changed its name to Leadiant Biosciences, Inc. reaffirming the company’s continued strong commitment to the patient communities it serves (Press release, , FEB 28, 2017, https://leadiant.com/sigma-tau-pharmaceuticals-inc-changes-name-to-leadiant-biosciences-inc/ [SID1234635543]).

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The announcement coincides with Rare Disease Day 2017, a global campaign to raise awareness of rare diseases and improve access to available treatments and medical representation for people, and their caregivers, whose lives are impacted by these conditions. Now in its 10th year, Rare Disease Day is an annual celebration organized by the European Organization for Rare Diseases (EURORDIS) and the National Organization for Rare Disorders (NORD). This year’s theme, With Research, Possibilities Are Limitless, underscores the importance of collaborative research in the drug-development process and recognizes the contributions of patients and families in advocating for increased investment in rare disease research.

"Rare Disease Day is the perfect time to unveil our new name and reaffirm our commitment to the study of rare diseases, which has been an integral part of our heritage dating back to 1984 when we became only the fourth company in the world to receive an Orphan Drug Designation in the U.S.," said Michael Minarich, chief executive officer, Leadiant Biosciences, Inc. "In 2017, Leadiant Biosciences will realize several important and exciting milestones in our product pipeline, as well as continuing multiple ongoing clinical trials."

For more information about the vision, mission and work of Leadiant Biosciences, Inc. visit www.leadiant.com.