On November 8, 2016 Neuralstem, Inc. (Nasdaq:CUR), a biopharmaceutical company focused on the development of central nervous system therapies based on its neural stem cell technology, reported its financial results and provided business and clinical updates for the three and nine month periods ended September 30, 2016 (Filing, Q3, Neuralstem, 2016, NOV 8, 2016, View Source [SID1234516658]).

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"This is an exciting time for Neuralstem, as we successfully continue to execute the new operational and clinical development strategy that was implemented in the beginning of the year," commented Rich Daly, Chief Executive Officer. "The recent announcement of the $20 million strategic investment from Tianjin Pharmaceutical Holdings Co., Ltd. provides credibility for our technology and a healthy financial runway through 2017. Furthermore, we reached 50% enrollment for our NSI-189 Phase 2 study in major depressive disorder ahead of schedule, maintaining expected data results in the second half of 2017."

Recent Business and Clinical Highlights

In May 2016, we enrolled the first subject in our NSI-189 Phase 2 clinical trial for the treatment of major depressive disorder (MDD).

In June 2016, we announced new NSI-189 preclinical data showing enhancement of mouse long term potentiation (LTP), an in vitro biomarker of memory by NSI-189 in a concentration-dependent and time-dependent manner. We believe that this study not only suggests the cognition enhancing potential of NSI-189, but also contributes toward the understanding of its mechanism of action.

In September 2016, we entered into a definitive agreement with Tianjin Pharmaceutical Holdings Co., Ltd. for a private placement of common stock and convertible preferred stock for gross proceeds of $20 million. This agreement is expected to close in the fourth quarter of 2016.

In September 2016, we achieved 50% enrollment in our Phase 2 clinical trial evaluating NSI-189 for the treatment of major depressive disorder (MDD).

In September 2016, we presented preclinical data which showed that NSI-189 was effective in the prevention and reversal of diabetic neuropathies in Type 1 and Type 2 diabetic mouse models.

In October 2016, we presented preclinical data which showed NSI-189’s ability to ameliorate radiation-induced cognitive impairment and to protect hippocampal neurogenesis in a mouse model of brain injury due to radiation therapy of brain cancers.
Results of Operations for the Third Quarter 2016

Research and Development expenses increased approximately $198,000 or 6% for the three months ended September 30, 2016 compared to the comparable period of 2015. This was primarily attributable to increased spending on clinical trials associated with our on-going Phase 2 MDD study, partially offset by salary and benefits saving associated with our reduction-in-force in May and reduced manufacturing expenses.

General and Administrative expenses decreased approximately $478,000 or 26% for the three months ended September 30, 2016 compared to the comparable period of 2015. This was primarily due to a reduction in salaries, benefits and consulting expenses as a result of our May 2016 reduction-in-force.

Other expenses, net totaled approximately $303,000 and $440,000 for the three months ended September 30, 2016 and 2015, respectively. Other expense, net in 2016 consisted of approximately $538,000 of losses related to the fair value adjustment of our derivative instruments and $240,000 of interest expense primarily related to our long-term debt, partially offset by a gain of approximately $459,000 related to our entering into a reimbursement agreement with a former executive officer.

Other expenses, net in 2015 consisted primarily of approximately $464,000 of interest expense principally related to our long-term debt partially offset by approximately $24,000 in interest income.

Results of Operations for the Nine Months Ended September 30, 2016

Research and Development expenses decreased approximately $758,000 or 8% for the nine months ended September 30, 2016 compared to the comparable period of 2015. This was primarily attributable to a decrease in manufacturing costs associated with producing clinical supplies of NSI-189 partially offset by an increase in pre-clinical and clinical trial expenses related to the initiation of our Phase 2 MDD study.

General and Administrative expenses increased approximately $937,000 or 19% for the nine months ended September 30, 2016 compared to the comparable period of 2015. This was primarily due to a severance accrual and increased non-cash stock based compensation resulting from the accelerated vesting of options, both related to the resignation of our former Chief Executive Officer coupled with non-cash stock based compensation expense resulting from grants to our new Chief Executive Officer which were partially offset by a decrease in our employee bonus expense.

Other expenses, net totaled approximately $694,000 and $1,334,000 for the nine months ended September 30, 2016 and 2015, respectively. Other expense, net in 2016 consisted of approximately $949,000 of interest expense primarily related to our long-term debt and $464,000 of fees related to the issuance of our derivative instruments, partially offset by a gain of approximately $459,000 related to our entering into a reimbursement agreement with a former executive officer of the Company and $219,000 of gain related to the change in the fair value adjustment of our derivative instruments.

Other expenses, net in the nine months ended September 30, 2015 consisted primarily of approximately $1,377,000 of interest expense principally related to our long-term debt partially offset by approximately $54,000 in interest income.

Neuralstem, Inc.

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss

Three Months Ended September 30, Nine Months Ended September 30,
2016 2015 2016 2015

Revenues $ 2,500 $ 2,500 $ 7,500 $ 7,917

Operating expenses:
Research and development expenses 3,589,793 3,392,086 9,130,012 9,887,750
General and administrative expenses 1,329,712 1,807,934 5,862,374 4,925,389
Total operating expenses 4,919,505 5,200,020 14,992,386 14,813,139
Operating loss (4,917,005 ) (5,197,520 ) (14,984,886 ) (14,805,222 )

Other income (expense):
Interest income 17,293 24,149 41,862 53,802
Interest expense (240,462 ) (464,197 ) (949,375 ) (1,377,004 )
Change in fair value of derivative instruments (538,261 ) – 219,014 –
Gain on related party settlement 458,608 – 458,608 –
Fees related to issuance of derivative instrument and other expenses (456 ) – (463,798 ) (10,326 )
Total other income (expense) (303,278 ) (440,048 ) (693,689 ) (1,333,528 )

Net loss $ (5,220,283 ) $ (5,637,568 ) $ (15,678,575 ) $ (16,138,750 )

Net loss per share – basic and diluted $ (0.05 ) $ (0.06 ) $ (0.15 ) $ (0.18 )

Weighted average common shares outstanding – basic and diluted 114,855,581 91,569,826 104,248,993 90,532,073

Comprehensive loss:
Net loss $ (5,220,283 ) $ (5,637,568 ) $ (15,678,575 ) $ (16,138,750 )
Foreign currency translation adjustment 21 (2,275 ) 1,516 (2,280 )
Comprehensive loss $ (5,220,262 ) $ (5,639,843 ) $ (15,677,059 ) $ (16,141,030 )

Neuralstem, Inc.

Unaudited Condensed Consolidated Balance Sheets

September 30,
2016 December 31,
2015

ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 5,676,129 $ 4,716,533
Short-term investments – 7,517,453
Trade and other receivables 12,685 37,316
Current portion of related party receivable, net of discount 51,733 –
Prepaid expenses 946,943 1,159,782
Total current assets 6,687,490 13,431,084

Property and equipment, net 315,543 343,200
Patents, net 984,125 1,103,467
Related party receivable, net of discount and current portion 413,466 –
Other assets 49,984 71,797
Total assets $ 8,450,608 $ 14,949,548

LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 2,484,335 $ 1,455,826
Accrued bonuses – 161,362
Current portion of long-term debt, net of fees and discount 4,829,428 4,545,180
Other current liabilities 538,350 263,104
Total current liabilities 7,852,113 6,425,472

Long-term debt, net of fees, discount and current portion – 3,382,654
Derivative instruments 4,363,156 –
Other long-term liabilities 20,290 174,144
Total liabilities 12,235,559 9,982,270

STOCKHOLDERS’ (DEFICIT) EQUITY
Preferred stock, 7,000,000 shares authorized, zero shares issued and outstanding – –
Common stock, $0.01 par value; 300 million shares authorized, 114,823,460 and 92,005,705 shares outstanding in 2016 and 2015, respectively 1,148,235 920,057
Additional paid-in capital 182,699,484 176,002,832
Accumulated other comprehensive income 4,587 3,071
Accumulated deficit (187,637,257 ) (171,958,682 )
Total stockholders’ (deficit) equity (3,784,951 ) 4,967,278
Total liabilities and stockholders’ (deficit) equity $ 8,450,608 $ 14,949,548

On November 8, 2016 Endo International plc (NASDAQ: ENDP) (TSX: ENL) reported third quarter 2016 financial results, including:
Revenues of $884 million including the addition of sales from its 2015 acquisition of Par Pharmaceutical, a 19 percent increase compared to third quarter 2015 revenues of $746 million(Press release, Endo, NOV 8, 2016, View Source;p=RssLanding&cat=news&id=2220454 [SID1234516401]).

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Reported net loss from continuing operations of $191 million compared to third quarter 2015 reported net loss from continuing operations of $804 million.

Reported diluted loss per share from continuing operations of $0.86 compared to third quarter 2015 reported diluted loss per share from continuing operations of $3.84.

Adjusted net income from continuing operations of $226 million, a 5 percent increase compared to third quarter 2015 adjusted net income from continuing operations of $214 million.1

Adjusted diluted EPS from continuing operations of $1.01 compared to third quarter 2015 adjusted diluted EPS from continuing operations of $1.02.1

"During the third quarter 2016, Endo further sharpened its focus on operational execution. We have continued to deliver results across all of our businesses that are on-track or ahead of Company expectations for the quarter. Today we are reaffirming our full year 2016 revenue and adjusted diluted EPS financial guidance," said Paul Campanelli, President and CEO of Endo. "This is an important time for Endo. The leadership team is working closely and collaboratively to build on our strengths and develop a go-forward strategy that best positions the Company to improve the lives of the patients and customers we serve."
FINANCIAL PERFORMANCE

(in thousands, except per share amounts)

Three Months Ended
September 30,

Nine Months Ended
September 30,

2016

2015

Change

2016

2015

Change
Total Revenues
$
884,335

$
745,727

19
%

$
2,768,761

$
2,195,021

26
%
Reported Income (Loss) from
Continuing Operations
$
(191,496)

$
(803,706)

(76)
%

$
109,553

$
(744,108)

NM
Reported Diluted Weighted Average
Shares
222,767

209,274

6
%

223,060

188,085

19
%
Reported Diluted Income (Loss) per
Share from Continuing Operations
$
(0.86)

$
(3.84)

(78)
%

$
0.49

$
(3.96)

NM
Adjusted Income from Continuing
Operations
$
225,519

$
214,110
1

5
%

$
658,591

$
625,805
1

5
%
Adjusted Diluted Weighted Average
Shares
223,139

210,787

6
%

223,060

192,144

16
%
Adjusted Diluted EPS from
Continuing Operations
$
1.01

$
1.02
1

(1)
%

$
2.95

$
3.26
1

(10)
%

(1) Refer to footnote 12 and 14 in the Reconciliation of GAAP and Non-GAAP Financial Measures tables for three and nine months ended September 30, 2015, respectively, for further discussion.
CONSOLIDATED RESULTS
Total revenues increased by 19 percent to $884 million in third quarter 2016 compared to the same period in 2015, primarily attributable to revenues related to the September 2015 Par acquisition. GAAP net loss from continuing operations in third quarter 2016 decreased to $191 million compared to a GAAP net loss from continuing operations of $804 million during the same period in 2015, primarily attributable to the amount of goodwill and intangible asset impairment charges recorded during the third quarter 2015. GAAP net loss per share from continuing operations for the three months ended September 30, 2016 was $0.86, compared to a GAAP net loss from continuing operations of $3.84 in third quarter 2015.
Adjusted net income from continuing operations for third quarter 2016 increased by 5 percent to $226 million compared to third quarter 2015, driven primarily by the contribution of Par, offset partially by an increase in interest expense. Adjusted net income per share from continuing operations for the three months ended September 30, 2016 decreased 1 percent to $1.01 compared to third quarter 2015.
U.S. BRANDED PHARMACEUTICALS
During third quarter 2016, the U.S. Branded Pharmaceuticals business unit continued to focus on supporting demand growth for XIAFLEX in both the Dupuytren’s contracture and Peyronie’s disease indications and the BELBUCA launch continues to progress.
Third quarter 2016 U.S. Branded Pharmaceuticals results include:
Revenues of $280 million, an 8 percent decrease compared to third quarter 2015; this decrease was primarily attributable to a generic entrant for Voltaren Gel in March 2016 and volume contraction across our established pain products.
Net sales of XIAFLEX increased 19 percent compared to third quarter 2015; this increase reflects high single-digit demand growth for the product and expected inventory build in the quarter.
U.S. GENERIC PHARMACEUTICALS
During third quarter 2016, the U.S. Generic Pharmaceuticals business unit continued to execute on its sales and marketing, research and development (R&D), and manufacturing plans for the year.
Third quarter and recent 2016 U.S. Generic Pharmaceuticals results include:
Revenues of $534 million, a 45 percent increase compared to third quarter 2015; this increase was primarily attributable to growth from the addition of sales by Par.
Generics Base business revenues declined approximately 20 percent sequentially compared to the second quarter 2016, due to deepening consortium pricing pressures and additional competitive entrants and product discontinuations as well as discrete factors, including destocking and shifts in purchase timing due to market conditions. The sequential decline would have been approximately 15 percent without these discrete factors and this deeper decline may continue into 2017.
On November 1, 2016, the Company launched the generic form of SEROQUEL XR, for which it has first-to-file status and 180 days of marketing exclusivity.
INTERNATIONAL PHARMACEUTICALS
During third quarter 2016, the International Pharmaceuticals business unit continued to focus on expanding adjusted margins for its emerging markets businesses, while in-licensing new products and managing the expected loss of exclusivity for certain products at Paladin.
Third quarter 2016 International Pharmaceuticals results include:
Revenues of $71 million, a 3 percent decrease compared to third quarter 2015.
Paladin revenues of $28 million, a 10 percent increase compared to third quarter 2015, due primarily to solid performance across the base business, the Canadian launch of Nucynta and the continuing management of the expected loss of exclusivity for two products.
Emerging market revenues from Litha and Somar of $38 million, a 4 percent decrease compared to third quarter 2015, driven primarily by a decrease in Litha revenues as it manages its recent divestiture of non-core assets and integrates its new portfolio of products and pipeline programs acquired from Aspen.
2016 Financial Guidance
For the full twelve months ended December 31, 2016, at current exchange rates, Endo is reaffirming its full year revenue and adjusted diluted EPS financial guidance. The Company estimates:
Total revenues to be between $3.87 billion and $4.03 billion;
Diluted GAAP EPS from continuing operations is now expected to be between $0.98 and $1.28; and
Adjusted diluted EPS from continuing operations to be between $4.50 and $4.80.
The Company’s 2016 financial guidance is based on the following assumptions:
Adjusted gross margin of approximately 60 percent;
Adjusted operating expenses as a percentage of revenues to be approximately 22.5 percent;
Adjusted interest expense of approximately $450 million;
Adjusted effective tax rate of approximately zero to 2 percent; and
Adjusted diluted EPS from continuing operations assumes full year adjusted diluted shares outstanding of approximately 223 million shares.
Balance Sheet, Liquidity and Other Updates
As of September 30, 2016, the Company had $561.6 million in unrestricted cash; net debt of approximately $7.7 billion and a net debt to adjusted EBITDA ratio of 4.9.
Third quarter 2016 cash used in operating activities was $111.3 million, primarily attributable to the funding of mesh payments, offset partially by improved cash collections.
During third quarter 2016, the Company recorded impairment charges of $93.5 million primarily related to unfavorable formulary changes and market conditions impacting its Sumavel DosePro product.

On November 8, 2016 OncoSec Medical Incorporated ("OncoSec") (NASDAQ: ONCS), a company developing DNA-based intratumoral cancer immunotherapies, reported that new clinical data are being presented from a Phase II Investigator Sponsored Trial led by the University of California, San Francisco (UCSF) (Press release, OncoSec Medical, NOV 8, 2016, View Source [SID1234516470]). This single-arm, open-label trial assessed the combination of OncoSec’s investigational intratumoral therapy, ImmunoPulse IL-12, and Merck’s KEYTRUDA (pembrolizumab) in patients with unresectable metastatic melanoma. A predictive biomarker was used to enroll patients that have a low likelihood of response to an anti-PD1 agent alone, and the purpose of the trial is to assess whether the addition of ImmunoPulse IL-12 can increase response rates in these patients. The data will be presented at an oral poster presentation (#466) by Dr. Alain Algazi at the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) ("SITC") Annual Meeting in National Harbor, MD on November 11, 2016 at 12:50 PM EST.

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In August 2016, OncoSec announced the publication of a research assay in the Journal of Clinical Investigation that might be used as a predicative biomarker in melanoma patients. The assay shows that patients with a low frequency of a certain phenotype of CD8 T cells, pre-disposes them to low response rates to PD-1 inhibitor therapy alone. The Company is using this biomarker assay to select patients considered to be PD-1 non responders for this ongoing combination study. The key endpoints of the study include: best overall response rate by the Response Evaluation Criteria in Solid Tumors (RECIST) v1.1 and immune-related Response Criteria; safety and tolerability; duration of response; 24-week landmark progression-free survival; median progression-free survival; and overall survival.

Results
Interim efficacy and safety data are available on 15 patients. In patients considered unable to respond to PD-1 we measured an overall response rate of 40% (6 /15), consisting of 4 complete responses and 2 partial responses by RECISTv1.1 criteria. Additionally, the therapy has an acceptable safety profile and was well tolerated. Analysis of tumor biopsies and blood correlated with patients’ responsiveness and demonstrated correlative immunological changes including an increased number of CD8+ tumor-infiltrating lymphocytes, tumoral RNA signatures and concordant immune phenotypes in the periphery. Investigators concluded that the combination of ImmunoPulse IL-12 with pembrolizumab in patients with an anti-PD-1 non-responsive phenotype enables an effective anti-PD-1 response.

Punit Dhillon, CEO of OncoSec, stated: "These results validate our therapeutic hypothesis for the ability of ImmunoPulse IL-12 to improve response rates in advanced melanoma. We wish to thank the investigators and patients for their continued participation in this study. We are working diligently to advance this agent towards registration-enabling studies, and we look forward to providing additional details regarding the Company’s operations and strategy at our upcoming Investor and Analyst Day on November 17, 2016."

Alain Algazi, M.D., Principal Investigator from UCSF, stated: "Although this open-label study is still ongoing and data are maturing, I am encouraged by the meaningful interim response rates that the combination of ImmunoPulse IL-12 and pembrolizumab has been able to achieve in a patient population otherwise expected to respond poorly to pembrolizumab alone. While checkpoint inhibition has conferred meaningful clinical benefit for advanced melanoma patients, there remains an urgent need to increase these agents’ efficacy through the rational combination with other immunotherapies. I look forward to the continued maturation of this data and to further reporting on the trial’s progress."

For more information about this trial, please visit: View Source;rank=3

On November 8, 2016 Heron Therapeutics, Inc. (NASDAQ:HRTX) (the Company or Heron), a biotechnology company focused on improving the lives of patients by developing best-in-class medicines that address major unmet medical needs, reported financial results for the three and nine months ended September 30, 2016 and highlighted recent corporate progress (Press release, Heron Therapeutics, NOV 8, 2016, View Source;p=RssLanding&cat=news&id=2220688 [SID1234516540]).

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Recent Corporate Progress:
Heron commenced U.S. commercial sales of SUSTOL (granisetron) extended-release injection in October 2016. SUSTOL was approved by the U.S. Food and Drug Administration in August 2016. SUSTOL is indicated in combination with other antiemetics in adults for the prevention of acute and delayed nausea and vomiting associated with initial and repeat courses of moderately emetogenic chemotherapy (MEC) or anthracycline and cyclophosphamide (AC) combination chemotherapy regimens.
Positive results from the Company’s Phase 2 clinical study of HTX-011, its lead product candidate for the management of post-operative pain, in patients undergoing inguinal hernia repair (Study 202) were presented at PAINWeek 2016. The primary and important secondary endpoints were achieved, and HTX-011 was generally well tolerated. Furthermore, HTX-011 administered via instillation was shown to be equally effective to administration via injection.

Heron reported positive, top-line results from the Company’s second Phase 2 clinical study of HTX-011 in patients undergoing bunionectomy (Study 208). The primary and important secondary endpoints were achieved, and HTX-011 was generally well tolerated.

"The second half of 2016 is off to an exciting start for Heron, highlighted by the FDA approval and commercial launch of SUSTOL," commented Barry D. Quart, Pharm.D., Chief Executive Officer of Heron. "We are progressing toward our NDA submission for HTX-019, the approval of which could position Heron as the first company to address both mechanisms of action for the prophylaxis of CINV with injectable products. Furthermore, we are excited about the impressive clinical profile of HTX-011 emerging from our broad-based Phase 2 program and look forward to providing a further update on the HTX-011 program in early 2017."

Results of Operations
As of September 30, 2016, Heron had $88.9 million in cash, cash equivalents and short-term investments, compared to $131.2 million in cash, cash equivalents and short-term investments as of December 31, 2015.

Heron’s net cash used for operating activities for the three and nine months ended September 30, 2016 was $36.1 million and $95.6 million, respectively, compared to net cash used for operating activities of $19.9 million and $55.4 million, respectively, for the same periods in 2015.

Heron’s net loss for the three and nine months ended September 30, 2016 was $48.5 million and $125.2 million, or $1.24 per share and $3.34 per share, respectively, compared to a net loss of $22.7 million and $66.3 million, or $0.63 per share and $2.07 per share, respectively, for the same periods in 2015.

The increases in net cash used for operating activities and net loss in the 2016 periods as compared to the 2015 periods were primarily due to costs incurred in preparation for the commercial launch of SUSTOL, as well as clinical and manufacturing costs related to the development of HTX-019 and HTX-011.

Ariad has filed a 10-Q – Quarterly report [Sections 13 or 15(d)] with the U.S. Securities and Exchange Commission (Filing, 10-Q, Ariad, NOV 8, 2016, View Source [SID1234516412]).

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