On November 21 Moleculin Biotech, Inc., (NASDAQ: MBRX) ("Moleculin" or the "Company"), a preclinical and clinical-stage pharmaceutical company focused on the development of anti-cancer drug candidates, some of which are based on license agreements with The University of Texas System on behalf of the M.D. Anderson Cancer Center ("MD Anderson"), reported its financial and operating results for the third quarter ended September 30, 2016 (Press release, Moleculin, NOV 3, 2016, View Source [SID1234516729]).

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During the third quarter and year to date, key activities included:
Updated the Annamycin clinical strategy to add a Phase I arm to its next Phase II trial that leverages a potential increase in the maximum tolerable drug dose, which could significantly increase the chance for positive outcomes. Despite some likely cost increases, which the Company believes will be offset by the Dermin supply agreement, as well as a likely extension in approval timing by several months, the Company believes that it remains on track to generate useful Phase II data by the second half of 2017;
Secured an agreement with Dermin Sp. Zo. O. to utilize its supply of Annamycin for the Company’s clinical trial, substantially reducing expenditures required of Moleculin for drug product and shortening the time required to produce clinical supplies;
Announced it had received verbal positive guidance from the FDA regarding its planned IND submission indicating that the Company may incorporate by reference the IND established by a prior developer;
Benefitting from additional grant funded research at MD Anderson for WP1066;
Announced promising initial results on the preclinical toxicology work for WP1122. Preliminary escalating single dose toxicity testing in mice was successfully completed. No toxic death was observed and the drug was well tolerated;
Appointed a new CFO, Jonathan P. Foster; and
Completed successful initial public offering and bridge financing.
Planned activities and milestones for the remainder of 2016 include:
Receive pre-IND guidance from FDA for liposomal Annamycin, an anthracycline for the treatment of relapsed or refractory acute myeloid leukemia (R/R AML);
Submit IND for liposomal Annamycin based on FDA guidance;
Strengthen license and IP portfolio; and
Continue development of pipeline assets, including drug and other molecular portfolio.
Walter Klemp, Chairman and CEO of Moleculin stated: "We continue to make progress towards executing on our clinical programs and are pleased with recent developments that allow us to more cost effectively fund our activities and potentially improve target outcomes, while maintaining our milestone to report Phase II data by the second half of 2017. We continue to believe we have sufficient funds to pursue our planned operations through the generation of Phase II data for Annamycin through the end of the third quarter of 2017."
Unaudited Financial Results for the Third Quarter Ended September 30, 2016
Research and development expense was $496,659 and $38,409 for the three months ended September 30, 2016 and 2015, respectively. The increase of approximately $458,000 mainly represents accrued license fees to MD Anderson for approximately $40,000, $37,500 for research performed by HPI, and approximately $228,000 related to MD Anderson sponsored research.
General and administrative expense was $924,041 and $184,344 for the three months ended September 30, 2016 and 2015, respectively. The expense increase of approximately $740,000 was mainly attributable to additional payroll and related expenses of approximately $459,000 related to a full three months of our Chief Financial Officer’s, Chief Operating Officer’s and Chief Executive Officer’s salaries and compensation for our Board of Directors. Also, included in this quarter’s expense was $118,000 related to the severance of the former Chief Financial Officer. The Company also incurred approximately $289,000 of expenses related to investor relations, audit and accounting, and insurance costs.
Interest expense included expense accrued on the Company’s convertible promissory notes issued in 2015 and 2016 bearing interest at the rate of 8% per annum.
The Company’s net loss for the three months ended September 30, 2016 amounted to $1,432,079.
As of September 30, 2016, the Company had $6,183,783 in cash. During the period from January 1, 2016 through May 2, 2016, the Company sold 234,296 common shares for $702,888. On May 31, 2016, the Company completed its initial public offering, pursuant to which it sold 1,540,026 shares of common stock at $6.00 per share for net proceeds of $8,464,183 after deducting underwriting discounts and commissions and direct offering expenses.
Net cash used in operating activities was $2,596,647 for the nine months ended September 30, 2016 and mainly included payments made for payroll, travel, insurance and professional fees to the Company’s consultants, attorneys and accountants for services related to becoming a publicly traded company and related filing fees, along with payments made to MD Anderson for license and maintenance fees. Additionally, prepayments were made for insurance.
Net cash used in investing activities was $109,793 for the nine months ended September 30, 2016 and primarily represents the cash paid to acquire Moleculin, LLC.
Net cash provided by financing activities was $8,862,132 for the nine months ended September 30, 2016. The Company received $8,464,183 net proceeds from its IPO stock issuance, $702,888 from issuance of common shares at $3 per share, and $165,000 from issuance of convertible notes. Net cash used in financing activities included approximately $470,000 for payments of notes payable.
(Tables to follow)
Restatement of the Unaudited Financial Results for the Second Quarter Ended
June 30, 2016
Today, the Company filed its restated unaudited financial statements for the Second Quarter Ended June 30, 2016 with the Security and Exchange Commission ("SEC") on Form 10-Q/A.
The Company identified the following non-cash errors due to an error in the accounting for the business combination of Moleculin, LLC. The impact of the correction of the error was as follows:
1 – The net loss for the three and six months ended June 30, 2016 was overstated by approximately $256,889 due to amortization of an intangible which was recorded in error. Upon correction, the net loss for the period will be $738,727 and $1,070,968, respectively.
2 – A liability in the amount of $750,000 should not have been reflected in the balance sheet as of June 30, 2016. Upon correction for this and item 1 above, the total for Liabilities and Stockholders’ Equity was $18,740,288.
3 – Intangibles were overstated by $750,000 before the amortization mentioned above. Upon correction, total assets was $18,740,288.

On November 3, 2016 Acceleron Pharma Inc. (NASDAQ:XLRN), a clinical stage biopharmaceutical company focused on the discovery, development and commercialization of innovative therapeutics to treat serious and rare diseases, reported a corporate update and reported financial results for the third quarter ended September 30, 2016 (Press release, Acceleron Pharma, NOV 3, 2016, View Source [SID1234516218]).

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"In the third quarter, we continued to make strong progress across our pipeline of clinical and preclinical programs," said John Knopf, Ph.D., Chief Executive Officer of Acceleron. "Enrollment continues to go well in both of the ongoing luspatercept Phase 3 studies in patients with myelodysplastic syndromes and beta-thalassemia. We look forward to providing new and updated preliminary results from several Phase 2 studies at the upcoming American Society of Hematology (ASH) (Free ASH Whitepaper) annual meeting in December. Within our muscle program, we’re on track to initiate the ACE-083 Phase 2 study in patients with facioscapulohumeral muscular dystrophy before year-end."

Continued Dr. Knopf, "I would also like to extend a warm welcome to the Company’s newly appointed Chief Executive Officer, Habib Dable, who will assume this role on December 1st. Habib’s global pharmaceutical operational and commercial experience will serve Acceleron well as we advance toward becoming a commercial-stage company."

THIRD QUARTER 2016 HIGHLIGHTS

Development Programs

Hematology

Enrollment is ongoing in the pivotal luspatercept Phase 3 clinical trials for the treatment of myelodysplastic syndromes (MDS) patients (the MEDALIST study) and beta-thalassemia patients (the BELIEVE study).
Enrollment is ongoing in Phase 2 trial cohorts evaluating luspatercept in a first-line treatment setting in low- or intermediate-risk MDS patients.
Data from five clinical abstracts on luspatercept and sotatercept will be presented at the 58th American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exposition to be held in San Diego, California on December 3-6, 2016.
Neuromuscular Disease

Initiation of the ACE-083 Phase 2 study in facioscapulohumeral muscular dystrophy (FSHD) patients expected to start by the end of the year.
Oncology

Enrollment continues in randomized part 2 of the Phase 2 DART study of dalantercept in combination with axitinib in patients with advanced renal cell carcinoma (RCC). The primary endpoint of this trial, progression-free survival (PFS), is an event-driven assessment with preliminary data expected in the first half of 2017.
Preclinical Research and Development

Acceleron continues its research on several molecules targeting musculoskeletal diseases, fibrotic disorders and other serious diseases. The most advanced molecule from the IntelliTrap platform, ACE-2494, continues to advance through IND-enabling activities. The Company plans to initiate a Phase 1 clinical trial with ACE-2494 in mid-2017.
Other Corporate Updates

Habib Dable appointed as President and CEO effective December 1, 2016. Mr. Dable joins Acceleron from Bayer AG, where he most recently served as President of U.S. Pharmaceuticals.
John Knopf retiring as President and CEO. Dr. Knopf is expected to apply his scientific expertise as an advisor to the Company.
Upcoming Events in Q4 2016

Present data at the ASH (Free ASH Whitepaper) annual meeting from ongoing luspatercept Phase 2 studies and an ongoing sotatercept Phase 2 investigator initiated trial in patients with myelofibrosis.
Initiate ACE-083 Phase 2 study in patients with FSHD, one of the most prevalent forms of muscular dystrophy.
Provide sotatercept development plan update before year-end.
Present at the 25th Annual Credit Suisse Healthcare Conference on Monday, November 7, 2016 in Scottsdale, Arizona.
Participate at the Citi Global Healthcare Conference to be held on December 7-8, 2016 in New York.
Financial Results

Cash position – Cash, cash equivalents and investments as of September 30, 2016 were $251.0 million. As of December 31, 2015 the Company had cash, cash equivalents and investments of $136.0 million. The Company believes that existing cash, cash equivalents and investments will be sufficient to fund its projected operating requirements into the second half of 2019.
Revenue – Collaboration revenue for the third quarter was $3.0 million. Cost sharing reimbursement revenue from the Company’s Celgene partnership was $2.9 million and is related to expenses incurred by the Company in support of its partnered programs.
Costs and expenses – Total costs and expenses for the third quarter were $23.5 million. This includes R&D expenses of $17.1 million and G&A expenses of $6.4 million.
Other expense, net – Other expense for the third quarter was $0.3 million and includes a $0.8 million, non-cash, loss on marking the Company’s common stock warrant liability to market.
Net loss – The Company posted a net loss for the third quarter ended September 30, 2016 of $20.8 million.

On November 3, 2016 Geron Corporation (Nasdaq:GERN) reported financial results for the three and nine months ended September 30, 2016 and recent events (Press release, Geron, NOV 3, 2016, View Source;p=RssLanding&cat=news&id=2219487 [SID1234516274]).

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For the third quarter of 2016, the company reported a net loss of $3.6 million, or $(0.02) per share, compared to net income for the third quarter of 2015 of $27.2 million, or $0.17 per share. Net loss for the first nine months of 2016 was $21.1 million, or $(0.13) per share, compared to net income for the first nine months of 2015 of $8.5 million, or $0.05 per share. The company ended the third quarter of 2016 with $129.8 million in cash and investments and has not incurred any impairment charges on its marketable securities portfolio.

Revenues for the three and nine months ended September 30, 2016 were $5.1 million and $6.1 million, respectively, compared to $35.4 million and $36.2 million for the comparable 2015 periods. Revenues for the three and nine month periods ending September 30, 2016 included license fee revenue of $5.0 million in connection with an upfront payment due under a license agreement signed in September 2016 with Janssen Pharmaceuticals, Inc. for certain rights to specialized oligonucleotide backbone chemistry and novel amidates. Revenues for the three and nine month periods ending September 30, 2015 included the full recognition of the $35.0 million upfront payment from Janssen Biotech, Inc. (Janssen) as collaboration revenue upon the company’s transfer of the imetelstat license rights and completion of technology transfer-related activities outlined under the imetelstat collaboration agreement with Janssen. The upfront cash payment was received in December 2014 and recorded as deferred revenue at that time.

Total operating expenses for the three and nine months ended September 30, 2016 were $9.0 million and $27.9 million, respectively, compared to $8.3 million and $28.1 million for the comparable 2015 periods. Research and development expenses for the three and nine months ended September 30, 2016 were $4.3 million and $13.9 million, respectively, compared to $4.1 million and $13.8 million for the comparable 2015 periods. General and administrative expenses for the three and nine months ended September 30, 2016 were $4.7 million and $14.0 million, respectively, compared to $4.3 million and $12.9 million for the comparable 2015 periods. Year-to-date operating expenses for 2015 also included restructuring charges of $1.3 million in connection with the company’s organizational resizing announced in March 2015.

The increase in research and development expenses for the three and nine month periods ending September 30, 2016, compared to the same periods in 2015, primarily reflected the net result of higher costs for the company’s proportionate share of clinical development expenses under the imetelstat collaboration with Janssen, partially offset by reduced personnel-related costs resulting from the March 2015 organizational resizing and lower costs for the manufacturing of imetelstat drug product. The company expects research and development expenses to be higher in 2016 compared to 2015 as the clinical development of imetelstat continues in collaboration with Janssen. The increase in general and administrative expenses for the three and nine month periods ending September 30, 2016, compared to the same periods in 2015, primarily reflected higher non-cash stock-based compensation expense and an increased allocation of facilities and other overhead costs to general and administrative activities.

Interest and other income for the three and nine months ended September 30, 2016 was $322,000 and $871,000, respectively, compared to $187,000 and $481,000 for the comparable 2015 periods. The increase in interest and other income for the three and nine month periods ending September 30, 2016, compared to the same periods in 2015, primarily reflected higher yields on the company’s marketable securities portfolio.

Recent Company Events

In the third quarter of 2016, Janssen conducted planned internal reviews of initial data from IMbarkTM and IMergeTM, the ongoing clinical trials of imetelstat.

IMbarkTM was designed to evaluate two dose levels of imetelstat (either 4.7 mg/kg or 9.4 mg/kg administered every three weeks) in approximately 200 patients (approximately 100 patients per dosing arm) with Intermediate-2 or High risk myelofibrosis (MF) who have relapsed after or are refractory to prior treatment with a JAK inhibitor. The co-primary efficacy endpoints for the trial are spleen response rate and symptom response rate at 24 weeks.

Janssen’s review included data from 20 patients from each dosing arm who had been followed on the trial for at least 12 weeks. In this review, no new safety signals were identified and the safety profile was consistent with previous imetelstat clinical trials in hematologic myeloid malignancies. Activity in the 4.7 mg/kg dosing arm did not warrant further investigation of that dose, and this arm has been closed to new patient enrollment. In the 9.4 mg/kg dosing arm, even though at the week 12 data assessment an insufficient number of patients met the protocol defined interim criteria, this arm warranted further investigation because encouraging trends in the efficacy data were observed. New enrollment in the 9.4 mg/kg arm has been suspended while the trial continues in order to obtain additional and more mature data that includes a longer follow-up of these patients at 24 weeks.

Enrolled patients in both arms are permitted to continue to receive imetelstat. Janssen has submitted a protocol amendment to health authorities that includes allowing eligible patients in the 4.7 mg/kg dosing arm to increase their dose to 9.4 mg/kg per investigator discretion.

IMergeTM is a two-part clinical study in patients with Low or Intermediate-1 risk myelodysplastic syndromes (MDS). Part 1 is a Phase 2, open-label, single-arm design in approximately 30 patients, which has been fully enrolled, and Part 2 is a Phase 3, randomized, double-blind, placebo-controlled design in approximately 170 patients. Janssen’s review of data in a subset of patients in Part 1 indicated that emerging safety and efficacy in IMergeTM is consistent with data reported from the pilot study conducted at Mayo Clinic in MDS patients. The primary efficacy endpoint for the trial is 8-week transfusion independence. IMergeTM continues unmodified at this time.

Second internal data reviews of additional and more mature data from both trials are planned by the end of the second quarter of 2017.

Three abstracts describing non-clinical data on imetelstat were accepted for presentation at the 58th American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exposition to be held in San Diego, California from December 3-6, 2016. The abstracts were published on November 3, 2016 on the ASH (Free ASH Whitepaper) website at www.hematology.org.

On November 3, 2016 Verastem, Inc. (NASDAQ:VSTM), focused on discovering and developing drugs to treat cancer, reported that new data for duvelisib, an investigational, oral, dual inhibitor of phosphoinositide-3-kinase (PI3K)-delta and PI3K-gamma, will be presented at the American Society of Hematology (ASH) (Free ASH Whitepaper) 2016 Annual Meeting, being held December 3-6, 2016 in San Diego (Press release, Verastem, NOV 3, 2016, View Source;p=RssLanding&cat=news&id=2219237 [SID1234516338]).
Data from DYNAMO, a Phase 2 monotherapy study evaluating the efficacy and safety of duvelisib in relapsed/refractory iNHL, will be presented in an oral session. Updated data from CONTEMPO, a Phase 1b/2 study evaluating duvelisib in combination with rituximab or obinutuzmab in treatment-naïve follicular lymphoma patients, and preclinical research on the role of Focal Adhesion Kinase (FAK) inhibition in AML, will be presented in a poster session.
Details for the presentations at ASH (Free ASH Whitepaper) are below:
Oral Presentation
Title: DYNAMO: A phase 2 study demonstrating the clinical activity of duvelisib in patients with relapsed refractory indolent non-Hodgkin lymphoma
Lead Author: Ian Flinn, M.D., Ph.D., Director, Hematologic Malignancies Program, Sarah Cannon Research Institute
Abstract Number: 1218
Location: San Diego Convention Center, Ballroom 20BC
Date and Time: Monday, December 5, 2016, 7:30 – 7:45 pm PT
The full abstract can be viewed here.
Poster Presentations
Title: Preliminary results in first-line treatment of follicular lymphoma with the oral dual PI3K-delta,gamma inhibitor, duvelisib, in combination with rituximab or obinutuzumab
Lead Author: Carla Casulo, M.D., Assistant Professor, Wilmot Cancer Institute, University of Rochester
Abstract Number: 2979
Location: San Diego Convention Center, Hall GH
Date and Time: Sunday, December 4, 2016, 6:00 – 8:00 pm PT
The full abstract can be viewed here.
Title: Inhibition of FAK Exerts Anti-Leukemic Activity and Potentiates ABT-199-Induced Apoptosis in AML
Lead Author: Bing Carter, Ph.D.., Associate Professor, Department of Leukemia – Research, Division of Cancer Medicine, The University of Texas MD Anderson Cancer Center
Abstract Number: 1574
Location: San Diego Convention Center, Hall GH
Date and Time: Saturday, December 3, 2016, 5:30 – 7:30 pm PT
The full abstract can be viewed here.
About the Tumor Microenvironment
The tumor microenvironment encompasses various cellular populations and extracellular matrices within the tumor or cancer niche that support cancer cell survival. This includes immunosuppressive cell populations such as regulatory T cells, myeloid-derived suppressor cells, M2 tumor-associated macrophages, as well as tumor-associated fibroblasts and extracellular matrix proteins which can hamper the entry and therapeutic benefit of cytotoxic immune cells and anti-cancer drugs. In addition to targeting the proliferative and survival signaling of cancer cells, Verastem’s compounds duvelisib, defactinib, VS-4718 and VS-5584 also target the tumor microenvironment as a mechanism of action to potentially improve a patient’s response to therapy.
About Duvelisib
Duvelisib is an investigational, dual inhibitor of phosphoinositide 3-kinase (PI3K)-delta and PI3K-gamma, two enzymes that are known to help support the growth and survival of malignant B cells and T cells. PI3K signaling may lead to the proliferation of malignant B cells and is thought to play a role in the formation and maintenance of the supportive tumor microenvironment.1,2,3 Duvelisib is currently being evaluated in late- and mid-stage clinical trials, including DUO, a randomized, Phase 3 monotherapy study in patients with relapsed/refractory chronic lymphocytic leukemia (CLL)4, and DYNAMO, a single-arm, Phase 2 monotherapy study in patients with refractory indolent non-Hodgkin lymphoma (iNHL) that achieved its primary endpoint of overall response rate upon topline analysis of efficacy data5. Duvelisib is also being evaluated for the treatment of hematologic malignancies through investigator-sponsored studies, including T cell lymphoma.6 Information about duvelisib clinical trials can be found on www.clinicaltrials.gov.

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On November 3, 2016 Innate Pharma SA (the "Company" – Euronext Paris: FR0010331421 – IPH) reported its revenues and cash position for the first nine months of 2016 (Press release, Innate Pharma, NOV 3, 2016, View Source [SID1234516195]).

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Cash, cash equivalents and financial instruments of the Company amounted to €239.6 million at September 30, 2016, including current and non-current financial assets (€243.6 million at June 30, 2016). At the same date, its financial liabilities amounted to €5.6 million (€4.1 million at June 30, 2016).

The consumption of cash, cash equivalents and financial instruments amounted to €4.0 million for the third quarter of 2016. This includes the collection during the period of the research tax credit relating to the year 2015 (€7.0 million) and of €2.0 million relating to finance-leases.

This revenue mainly results from:

€27.2 million resulting from the co-development and commercialization agreement with AstraZeneca, corresponding to the recognition over the period of the initial payment received in April 2015 (€5.9 million for the same period in 2015);
€0.7 million from the collaboration and licensing agreement with Bristol-Myers Squibb corresponding to the recognition of the upfront payment received in July 2011 (€4.4 million from a milestone payment for the same period in 2015).
As a reminder, within the frame of the collaboration and licensing agreement signed with Bristol-Myers Squibb in July 2011, the upfront payment received (€24.9 million, $35.3 million) was recognized in revenue during the expected period of duration of the clinical program in progress at the date of the contract. This upfront payment was entirely recognized as of June 30, 2016.

Regarding the co-development and commercialization agreement with AstraZeneca, the Company recognizes the initial payment of $250 million over the period during which the Company is committed to complete the studies and based on actual expenses incurred. The measurement of progress has been based on actual expenses incurred compared to the total estimated amount of expenses to be incurred for these studies.

Hervé Brailly, Chief Executive Officer of Innate Pharma, commented: "Innate Pharma is pleased to report another period of significant progress, as our core programs continue to advance in the clinic and we are maintaining a solid cash position. Preliminary safety and clinical activity results for IPH4102 have been presented at the world congress of cutaneous lymphomas. These results are encouraging for this wholly-owned program. Recently, our partner Bristol-Myers Squibb reported safety data for lirilumab and we now look forward to the release of efficacy data at the SITC (Free SITC Whitepaper) annual meeting in a few days. Beyond our clinical programs, we have continued to invest in our proprietary preclinical pipeline as we seek to build the Company’s wholly-owned portfolio of programs and improve cancer treatment and clinical outcomes for patients."