On August 2, 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 quarter ended June 30, 2017 (Press release, MacroGenics, AUG 2, 2017, View Source [SID1234519997]).

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"MacroGenics’ broad portfolio of product candidates continues to advance. We are very encouraged by the data we’ve seen to date in our Phase 1 study of flotetuzumab, a CD123 x CD3 bispecific DART molecule, and we look forward to presenting the updated interim results from this trial in an oral presentation at ESMO (Free ESMO Whitepaper) in September," said Scott Koenig, M.D., Ph.D., President and CEO of MacroGenics. "In addition, we continue to make progress with margetuximab, our B7-H3-based franchise and our PD-1-targeted franchise. During the second quarter, our IND for MGD013, which targets PD-1 and LAG-3, was cleared by FDA and we expect to dose the first patients in the coming weeks. I look forward to sharing updates on our pipeline and further defining our future development strategies over the remainder of the year."

Key Pipeline Highlights

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 remains on track for completing enrollment of this study by late 2018.
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. 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 a monotherapy study that includes patients with bladder or prostate cancer and a combination study with an anti-PD-1 antibody.
MGD009: This DART molecule targeting B7-H3 and CD3 is being evaluated in a Phase 1 study across multiple solid tumor types. The Company expects to establish the dose and schedule for MGD009 administration as well as initiate expansion cohorts in multiple tumor types in 2017.
MGC018: The Company is conducting activities to support the submission of an Investigational New Drug (IND) application for this anti-B7-H3 antibody drug conjugate in 2018.
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 proprietary anti-PD-1 monoclonal antibody is enrolling patients in the dose escalation segment of its Phase 1 clinical study and expects to define a target dose and schedule soon. To date, the antibody has been well tolerated up to 10 mg/kg. With anti-PD-1 therapy becoming a mainstay of cancer treatment across multiple tumor types, MacroGenics believes MGA012 will be the basis for potential combination therapy with several of the molecules in its pipeline. The Company plans to initiate the first such study of MGA012 in combination with another internal program by year end 2017, subject to regulatory feedback.
MGD013. MacroGenics is developing MGD013, a DART molecule, 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’s IND submitted for MGD013 was cleared by FDA in May and commencement of enrollment is expected imminently.
PD-1 x CTLA-4. MacroGenics continues to advance its preclinical bispecific DART and trispecific TRIDENT molecules that bind to and inhibit ligand interaction with PD-1 and CTLA-4, resulting in enhanced T-cell activation. By targeting these clinically validated checkpoint molecules simultaneously, MacroGenics’ DART and TRIDENT proteins hold the promise of enhanced anti-tumor activity together with a simplified development path.
Additional DART Clinical Programs. Other DART molecules being led by MacroGenics in Phase 1 clinical development include flotetuzumab (CD123 x CD3, also known as MGD006 and S80880), MGD007 (gpA33 x CD3) and MGD010 (CD32B x CD79B). Updates on these programs include:

Flotetuzumab. In July, MacroGenics was notified that its abstract titled "Interim Results from a Phase 1 First-in-Human study of flotetuzumab, a CD123 x CD3 bispecific DART molecule, in AML/MDS" had been accepted for oral presentation at the European Society for Medical Oncology Annual Congress, ESMO (Free ESMO Whitepaper) 2017. The Company continues to recruit patients with acute myeloid leukemia or myelodysplastic syndrome in the U.S. and Europe and has established a recommended dose and schedule and has initiated expansion cohorts for this study.
MGD007. MacroGenics continues to recruit patients with colorectal cancer in a Phase 1 study. The Company has initiated various expansion cohorts to define a recommended dose and schedule.
MGD010. In June, MacroGenics presented updated data from its Phase 1 study of MGD010 at the EULAR Annual European Congress of Rheumatology. The Company highlighted data demonstrating that a single dose administration of MGD010 at either 3 or 10 mg/kg delivers an immunomodulatory effect that counters B-cell function.
Second Quarter 2017 Financial Results

Cash Position: Cash, cash equivalents and marketable securities as of June 30, 2017, were $243.7 million, compared to $285.0 million as of December 31, 2016.
Revenue: Total revenue, consisting primarily of revenue from collaborative agreements, was $1.7 million for the quarter ended June 30, 2017, compared to $80.7 million for the quarter ended June 30, 2016. This decrease was primarily due to the receipt of $75.0 million in 2016 as an upfront payment under a collaboration and license agreement with Janssen for MGD015. Revenue from collaborative agreements includes the recognition of deferred revenue from payments received in previous periods as well as payments received during the period.
R&D Expenses: Research and development expenses were $34.5 million for the quarter ended June 30, 2017, compared to $33.3 million for the quarter ended June 30, 2016.
G&A Expenses: General and administrative expenses were $8.4 million for the quarter ended June 30, 2017, compared to $7.2 million for the quarter ended June 30, 2016. This increase was primarily due to increased professional fees, including consulting expenses, and increased employee compensation and benefit expense to support our overall growth.
Net Loss: Net loss was $40.7 million for the quarter ended June 30, 2017, compared to net income of $40.5 million for the quarter ended June 30, 2016.
Shares Outstanding: Shares outstanding as of June 30, 2017 were 36,680,522.

On August 02, 2017 Mateon Therapeutics, Inc. (OTCQX:MATN), a biopharmaceutical company developing vascular disrupting agents (VDAs) for the treatment of orphan oncology indications, reported a corporate update and reported financial results for the three months ended June 30, 2017.

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Recent Corporate Highlights

Granted Fast Track designation by U.S. Food and Drug Administration for OXi4503 for treatment of acute myeloid leukemia (AML);
Announced two complete remissions (50%) in the fifth cohort of the OXi4503 study for the treatment of relapsed/refractory AML;
Completed enrollment of the FOCUS study of CA4P for the treatment of platinum-resistant ovarian cancer;
Announced positive data for CA4P in combination with immune-oncology agents demonstrating significant reduction in tumor size in an animal model.

"With renewed interest in the clinical potential of our vascular disrupting agents, our programs have picked up significant momentum and have advanced ahead of schedule," said William D. Schwieterman, M.D., President and Chief Executive Officer. "We recently observed new evidence of efficacy in our AML study, as well as completed enrollment in the first part of the FOCUS study. I am pleased we have advanced our programs to important data inflection points. We all look forward to further advancing this important therapeutic class."

Financial Results for the Second Quarter of 2017

For the three months ended June 30, 2017, Mateon reported a net loss of $3.9 million, compared to a net loss of $3.6 million for the three months ended June 30, 2016. Research and development expenses increased to $3.0 million for the three months ended June 30, 2017, compared to $2.4 million for the three months ended June 30, 2016, primarily due to higher clinical costs associated with the FOCUS study in platinum-resistant ovarian cancer. General and administrative expenses decreased to $0.9 million for the three months ended June 30, 2017, compared to $1.3 million for the three months ended June 30, 2016.

At June 30, 2017, Mateon had cash and short-term investments of $5.0 million.

On August 2, 2017 Cellectis S.A. (Alternext: ALCLS – Nasdaq: CLLS), a clinical-stage biopharmaceutical company focused on developing immunotherapies based on gene-edited CAR T-cells (UCART), reported its results for the three-month period ended June 30, 2017 and for the six-month period ended June 30, 2017 (Press release, Cellectis, AUG 2, 2017, View Source [SID1234519991]).

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Second Quarter 2017 and Recent Highlights

Cellectis – Therapeutics

UCART123: Cellectis’ most advanced, wholly controlled TALEN gene-edited, allogeneic CAR T product candidate

First patient administration of UCART123 product candidate – in Acute Myeloid Leukemia (AML), marking the start of the Phase I dose escalation study.
For AML patients, the Phase I clinical trial is being conducted at Weill Cornell Medicine New York – Presbyterian Hospital, and led by Gail J. Roboz, MD, Director of the Clinical and Translational Leukemia Programs and Professor of Medicine.
For Blastic Plasmacytoid Dendritic Cell Neoplasm (BPDCN) patients, the Phase I clinical trial is being conducted at MD Anderson Cancer Center, and is led by Naveen Pemmaraju, MD, Assistant Professor, and Hagop Kantarjian, MD, Professor and Department Chair, Department of Leukemia, Division of Cancer Medicine.
UCART19: exclusively licensed to Servier

IND clearance obtained for Servier, in collaboration with Pfizer, to proceed with UCART19 Phase I clinical trials in the U.S. in patients with relapsed /refractory acute lymphoblastic leukemia (ALL).
UCART19 Phase I clinical trials in pediatric and adult ALL patients are ongoing at University College London (UCL) and Kings College London (KCL), in the UK, sponsored by Servier.
Manufacturing

On-going manufacturing of UCART CS1, an allogeneic CAR T-cell product candidate for Multiple Myeloma
Signed a Development and Manufacturing Agreement on July 27, 2017 with MolMed S.p.A for the development and manufacturing of UCAR T-cell product candidates
IP/ Patent portfolio

U.S. patent 8,921,332, which claims the use of chimeric restriction endonucleases for directing chromosomal gene editing in cells by homologous recombination (HR), initially issued on Dec. 30, 2014, was upheld by the United States Patent and Trademark Office (USPTO) after a reexamination initiated in October 2015.

Grant by the European Patent Office of patent No. EP3004337, covering a method of using RNA-guided endonucleases, such as Cas9 or Cpf1 for the genetic engineering of T-cells.

Conferences

Presentation of data on Cellectis’ UCART product candidates at the ASGCT (Free ASGCT Whitepaper) 20th Annual Meeting in Washington, D.C., USA.
Presentations on Cellectis-controlled programs and Pfizer/Cellectis collaboration programs at the 2017 American Association for Cancer Research (AACR) (Free AACR Whitepaper) Annual Meeting:
Wholly-controlled Program UCART22: An Allogeneic Adoptive Immunotherapy for Leukemia Targeting CD22 with CAR T-cells;
Collaboration Programs:
Allogeneic EGFRvIII Chimeric Antigen Receptor T-cells for Treatment of Glioblastoma and
Differential Modulation of the PD-1 Pathway Impacts the Anti-Tumor Activity of CAR T- cells.
Company’s founder, Chairman and CEO, Dr. André Choulika participated at the 2017 Milken Institute Global Conference as a panelist for a session titled, "Humankind vs. Cancer: The Scorecard" on Wednesday, May 3, 2017.
Corporate Governance

Cellectis Shareholders’ General Meeting was held at the Company’s head office in Paris on June 26, 2017. At the meeting, more than 73% of voting rights were exercised, and all resolutions recommended by the board of directors, were adopted, including:
the appointment of two new directors to the board of directors, Mr. Rainer Boehm and Mr. Hervé Hoppenot; and
the renewal of the term of office of director of Mr. Laurent Arthaud, Mr. Pierre Bastid and Mrs. Annick Schwebig.
Calyxt Inc. – Cellectis’ plant science subsidiary

Calyxt closed its IPO with $64.4 million in gross proceeds to Calyxt from the sale of approximately 8 million shares at $8 per share, including the full exercise of the underwritter’s overallotment option and Cellectis’ purchase of $20.0 million of shares in the IPO. Calyxt’s shares of common stock are traded on NASDAQ under the symbol "CLXT". Cellectis owns approximately 79.9% of Calyxt’s outstanding shares of common stock.
Calyxt launched, under a services agreement with University of Minnesota U.S. field trials for powdery mildew-resistant spring wheat variety, representing its fourth gene-edited crop to undergo trials
Joseph B. Saluri was named as General Counsel and Executive Vice President, Corporate Development. Mr. Saluri brings to Calyxt over 24 years of legal, business development, strategic planning and project management experience in the global agri-business space.
Calyxt signed an agreement with a third-party for the sale and leaseback of its Roseville, MN, greenhouse and warehouse facility and construction of the remaining facility. The completion of the sale is conditioned on Calyxt and the buyer entering into a new facility construction agreement and a lease in respect of the property in the forms contemplated by the sale agreement.
Financial Results

Cellectis’ consolidated financial statements have been prepared in accordance with International Financial Reporting Standards, or IFRS, as issued by the International Accounting Standards Board ("GAAP").

Second Quarter 2017 Financial Results

Cash: As of June 30, 2017, Cellectis had €237.6 million in total cash, cash equivalents and current financial assets compared to €258.5 million as of March 31, 2017. This decrease of €20.9 million reflects (i) net cash flows used by operating activities of €10.0 million, (ii) capital expenditures of €0.7 million and (iii) the unrealized negative translation effect of exchange rate fluctuations on our U.S. dollar cash, cash equivalents and current financial assets of €11.0 million; partially offset by (iv) the increase in equity mainly attributable to the exercise of share warrants for €0.8 million.

Revenues and Other Income: During the quarters ended June 30 2016 and 2017, we recorded €18.1 million and €8.2 million, respectively, in revenues and other income. This decrease is mainly due to a €10.0 million decrease in collaboration revenues of which €7.7 million represented milestone, revenues received during the second quarter of 2016 with the first patient dosed in Phase I clinical trial for UCART19, and a decrease of €2.0 million in recognition of upfront already paid to Cellectis.

Total Operating Expenses: Total operating expenses for the second quarter of 2017 were €26.2 million, compared to €28.2 million for the second quarter of 2016. The non-cash stock-based compensation expenses included in these amounts were €11.3 million and €14.4 million, respectively.

R&D Expenses: For the quarters ended June 30, 2016 and 2017, research and development expenses decreased by €2.6 million from €19.5 million in 2016 to €16.9 million in 2017. Personnel expenses decreased by €3.2 million from €11.6 million in 2016 to €8.4 million in 2017, primarily due to a €3.1 million decrease in non-cash stock based compensation expense, partly offset by a €0.1 million increase in wages and salaries. Purchases and external expenses and other expenses increased by €0.5 million from €7.5 million in 2016 to €8.0 million in 2017, mainly due to increased expenses related to payments to third parties participating in product development, purchases of biological raw materials and expenses associated with the use of laboratories and other facilities.

SG&A Expenses: During the quarters ended June 30, 2016 and 2017, we recorded €8.6 million and €9.1 million, respectively, of selling, general and administrative expenses. The increase of €0.5 million primarily reflects an increase of €0.6 million in personnel expenses from €6.5 million to €7.1 million, attributable, among other things, to an increase of €0.6 in wages and salaries and an increase of €0.1 million in non-cash stock-based compensation expense, partially offset by a decrease of €0.2 million in purchases and external expenses.

Financial Gain (Loss): The financial gain was €3.8 million for the second quarter of 2016 compared with a financial loss of €6.0 million for the second quarter of 2017. The change in financial result was primarily attributable to a decrease in net foreign exchange loss of €11.5 million due to the effect of exchange rate fluctuations on our U.S. dollar cash and cash equivalent accounts and an increase of €1.9 million in fair value adjustment income on our foreign exchange derivatives and current financial assets.

Net Income (Loss) Attributable to Shareholders of Cellectis: During the three months ended June 30, 2016 and 2017, we recorded a net loss attributable to shareholders of Cellectis of €6.3 million (€0.18 per share on both a basic and a diluted basis) and net loss attributable to shareholders of Cellectis of €24.1 million (€0.68 per share on both a basic and a diluted basis), respectively. Adjusted loss attributable to shareholders of Cellectis for the second quarter of 2017 was €12.8 million (€0.36 per share on both a basic and a diluted basis) compared to adjusted income attributable to shareholders of Cellectis of €8.1 million (€0.23 per share on both a basic and a diluted basis), for the second quarter of 2016. Adjusted income (loss) attributable to shareholders of Cellectis for the second quarter of 2017 and 2016 excludes non-cash stock-based compensation expense of €11.3 million and €14.4 million, respectively. Please see "Note Regarding Use of Non-GAAP Financial Measures" for reconciliation of GAAP net income (loss) attributable to shareholders of Cellectis to adjusted income (loss) attributable to shareholders of Cellectis.

First Six Months 2017 Financial Results

Cash: As of June 30, 2017, Cellectis had €237.6 million in total cash, cash equivalents and current financial assets compared to € 276.2 million as of December 31, 2016. This decrease of €38.6 million primarily reflects (i) net cash flows used by operating activities of €25.2 million, (ii) capital expenditures of €1.4 million and (iii) the unrealized negative translation effect of exchange rate fluctuations on our U.S. dollar cash, cash equivalents and current financial assets of €13.0 million; partially offset by an increase in equity mainly attributable to the exercise of share warrants for €1.0 million.

Cellectis expects that its cash, cash equivalents and current financial assets of €237.6 million as of June 30, 2017 will be sufficient to fund its current operations to 2019.

Revenues and Other Income: During the six-month periods ended June 30, 2016 and 2017, we recorded €27.6 million and €17.8 million, respectively, in revenues and other income. This decrease is mainly due to (i) a €10.4 million decrease in collaboration revenues of which €7.7 million represented milestones revenues received during the second quarter of 2016 with the first patient dosed in the Phase I clinical trial for UCART 19, a decrease of €3.5 million in recognition of upfront fees already paid to Cellectis and a decrease of €0.8 million in research and development cost reimbursements; partially offset by an increase of €1.5 million in revenue related to supply to Servier, partly offset by (ii) an increase of €0.7 million in research tax credits.

Total Operating Expenses: Total operating expenses for the six-month period ended June 30, 2017 were €54.4 million, compared to €58.1 million for the six months ended June 30, 2016. The non-cash stock-based compensation expenses included in these amounts were €24.1 million and €27.8 million, respectively.

R&D Expenses: For the six-month periods ended June 30, 2016 and 2017, research and development expenses decreased by €3.1 million from €38.4 million in 2016 to €35.3 million in 2017. Personnel expenses decreased by €5.3 million from €23.5 million in 2016 to €18.2 million in 2017, primarily due to a €3.7 million decrease in non-cash stock based compensation expense, and a €1.7 million decrease in social charges on stock options; grants partly offset by a €0.1 million increase in wages and salaries. Purchases and external expenses increased by €2.0 million from €14.2 million in 2016 to €16.2 million in 2017, mainly due to increased expenses related to payments to third parties participating in product development, purchases of biological raw materials and expenses associated with the use of laboratories and other facilities.

SG&A Expenses: During the six-month periods ended June 30, 2016 and 2017, we recorded €19.1 million and €18.2 million, respectively, of selling, general and administrative expenses. The decrease of €0.9 million primarily reflects (i) a decrease of €0.4 million in personnel expenses from €14.8 million to €14.3 million, attributable, among other things, to a decrease of €1.5 million of social charges on stock options grants, partly offset by a €1.1 million increase in wages and salaries, and (ii) a decrease of €0.6 million in purchases and external expenses.

Financial Gain (Loss): The financial loss was €5.3 million for the six-month period ended June 30, 2016 compared with financial loss of €6.1 million for the six-month period ended June 30, 2017. The change in financial result was primarily attributable to the effect of exchange rate fluctuations on our U.S. dollar cash and cash equivalent accounts for €3.9 million partially offset by the fair value adjustment on our derivative instrument and financial current asset for €3.0 million.

Net Income (Loss) Attributable to Shareholders of Cellectis: During the six-months periods ended June 30, 2016 and 2017, we recorded a net loss attributable to shareholders of Cellectis of €35.7 million (€ 1.01 per share on both a basic and a diluted basis) and a net loss attributable to shareholders of Cellectis of €42.7 million (€1.20 per share on both a basic and diluted basis), respectively. Adjusted loss attributable to shareholders of Cellectis for the six-month period ended June 30, 2017 was €18.6 million (€0.52 per share on both a basic and a diluted basis) compared to adjusted loss attributable to shareholders of Cellectis of €7.9 million (€0.22 per share on both a basic and a diluted basis), for the six-month period ended June 30, 2016. Adjusted loss attributable to shareholders of Cellectis for the six-month periods ended June 30, 2017 and 2016 excludes a non-cash stock-based compensation expense of €24.1 million and €27.8 million, respectively. Please see "Note Regarding Use of Non-GAAP Financial Measures" for a reconciliation of GAAP net income (loss) attributable to shareholders of Cellectis to Adjusted income (loss) attributable to shareholders of Cellectis.

On August 2, 2017 Aduro Biotech, Inc. (NASDAQ:ADRO) reported financial results for the second quarter of 2017 (Press release, Aduro Biotech, AUG 2, 2017, View Source [SID1234519990]). Net loss for the second quarter 2017 was $19.4 million, or $0.27 per share, and for the six months ended June 30, 2017 net loss was $41.2 million, or $0.59 per share, compared to net income of $2.3 million, or $0.04 per share, and net loss of $26.5 million, or $0.41 per share, respectively, for the same periods in 2016.

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Cash, cash equivalents and marketable securities totaled $377.2 million at June 30, 2017, compared to $361.9 million at December 31, 2016.

"We are making great progress as we approach a number of near-term milestones across all three of our distinct immunotherapy platforms," said Stephen T. Isaacs, chairman, president and chief executive officer of Aduro. "In the remaining period of 2017, we expect to initiate a number of new clinical trials, including a combination trial with ADU-S100 and anti-PD-1; a first-in-human Phase 1 trial with pLADD, a personalized second-generation LADD targeting neoantigens, in patients with certain colorectal cancers; and a first-in-human clinical trial with our lead B-select candidate, an anti-APRIL monoclonal antibody, in multiple myeloma. With these anticipated new trials, all of our technology platforms will be in the clinic. In addition, we expect to share preliminary clinical data from the ongoing Phase 1 dose escalation monotherapy trial of ADU-S100, as well as preliminary data from the ongoing Phase 2 trial of CRS-207 and anti-PD-1 in mesothelioma. With a comprehensive portfolio of investigational immunotherapies, we are poised with multiple opportunities to deliver on our goal of building a successful biotech company by bringing innovative medicines to patients."

Key Recent Accomplishments

Established a clinical collaboration with Merck to evaluate the combination of Aduro’s LADD agent CRS-207 with Merck’s anti-PD-1 KEYTRUDA (pembrolizumab) in a Phase 2 trial in mesothelioma cancer and subsequently initiated this trial
Received FDA clearance of an Investigational New Drug Application (IND) for the Phase 1b study of Aduro’s ADU-S100 and PDR001, Novartis’ anti-PD-1 checkpoint inhibitor
Initiated a Phase 2 clinical trial of CRS-207 in combination with pembrolizumab for patients with previously-treated gastric cancer
Earned a $2 million milestone under a worldwide licensing agreement with Merck for work supporting the preparation of an IND for the B-select anti-CD27 monoclonal antibody
Remaining Anticipated 2017 Milestones

Initiate Phase 1 pLADD (personalized LADD) trial in certain colorectal cancers
Janssen expected to initiate Phase 1b/2 trial of ADU-214 in lung cancer and determine next steps for ADU-741 in prostate cancer
Initiate Phase 1b trial of ADU-S100 in combination with anti-PD-1 in collaboration with Novartis
Report early results from the Phase 2 mesothelioma study evaluating CRS-207 in combination with pembrolizumab
Report preliminary top-line findings from Phase 1 monotherapy trial of ADU-S100
File an IND for BION-1301, an anti-APRIL antibody
Initiate Phase 1 multiple myeloma trial with BION-1301, an anti-APRIL antibody
Second Quarter 2017 Financial Results

Revenue was $5.9 million for the second quarter of 2017 and $9.7 million for the six months ended June 30, 2017, compared to $39.0 million and $43.0 million, respectively, for the same periods in 2016. The decrease in revenue in both periods is due to the recognition of a $35.0 million milestone payment in the second quarter of 2016 in connection with the clinical advancement of ADU-S100 under our agreement with Novartis. For the second quarter of 2017, the decrease was partially offset by the recognition of $2.0 million in connection with the achievement of a milestone under our anti-CD27 antibody agreement with Merck.

Research and development expenses were $21.4 million for the second quarter of 2017 and $42.0 million for the six months ended June 30, 2017, compared to $26.9 million and $47.8 million, respectively, for the same periods in 2016. The decrease in research and development expenses in both periods was primarily related to reduced GVAX Pancreas manufacturing and pancreatic cancer clinical trial expenses, partially offset by increased costs to manufacture our B-select antibodies as well as higher personnel and facility related costs in 2017.

General and administrative expenses were $8.3 million for the second quarter of 2017 and $16.5 million for the six months ended June 30, 2017, compared to $8.7 million and $17.7 million, respectively, for the same periods in 2016. The decrease in general and administrative expenses in both periods was primarily related to lower professional services and consulting expenses in 2017, partially offset by higher facility costs in 2017.

Income tax benefit was $3.8 million for the second quarter of 2017 and $6.5 million for the six months ended June 30, 2017, compared to a provision for income taxes of $1.5 million and $4.7 million, respectively, for the same periods in 2016. The income tax benefit recorded in 2017 was due to the current benefit of federal income taxes paid in 2016.

On August 2, 2017 BioTime, Inc. (NYSE MKT: BTX), a clinical-stage biotechnology company developing and commercializing products addressing degenerative diseases, reported financial results for the second quarter ended June 30, 2017 (Press release, BioTime, AUG 2, 2017, View Source [SID1234519988]).

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"The second quarter of 2017 was very productive for BioTime, with numerous significant clinical, financial and operational accomplishments. BioTime and its subsidiaries and affiliates now have six products in clinical trials. The data from those trials continue to be positive and encouraging," said Adi Mohanty, Co-Chief Executive Officer. "On the strength of the positive results from our pivotal study of Renevia, we are preparing to file for a CE mark for commercial approval in Europe. Our goal is to commercialize Renevia in its first indication in 2018. For OpRegen, our therapeutic product candidate for the treatment of dry AMD, we were pleased to receive DSMB approval to advance the ongoing Phase I/IIa trial to the third cohort, which will include clinical sites in the U.S."

"We continue to make progress on simplifying our corporate structure to allow us to execute our objectives more efficiently, as well as to make it easier for investors and other external stakeholders to better understand BioTime," continued Mr. Mohanty. "We achieved an important milestone toward accomplishing these goals with the launch of AgeX Therapeutics, a subsidiary formed to consolidate our early-stage research and development programs related to the biology of aging and age-related disease. AgeX recently commenced operations following a $10 million equity financing."

Highlights

Clinical Progress

Renevia (adipose cells + cell delivery matrix)

Renevia successfully met its primary endpoint in a pivotal trial in patients with HIV-associated lipoatrophy (facial fat loss) conducted in Europe. Treated patients retained approximately 100% of transplanted volume at 6 months compared to no incremental hemifacial volume in the untreated patients (p<0.001). All Renevia transplants were shown to be safe and well tolerated and there were no serious adverse events during the trial.
BioTime is on track to file for CE Mark for commercial approval for Renevia in Europe by the end of 2017.
Additional trials in the U.S. are planned that target a broader $7 billion aesthetics market opportunity, which is consistent with the previously stated goal of indication and geographic expansion for Renevia.
OpRegen (retinal pigment epithelial cells)

In April, new positive clinical data on OpRegen were presented at the Annual Meeting of the Association for Research in Vision and Ophthalmology (ARVO). The data, from the first and second cohorts of the ongoing Phase I/IIa clinical trial in the advanced form of dry-AMD, showed that OpRegen cells engraft and that there was evidence of a biological response.
The Data Safety Monitoring Board (DSMB) monitoring the Phase I/IIa OpRegen trial has authorized BioTime to move forward with enrollment for cohort 3 which will include two US sites with leading ophthalmologists.
An abstract related to the Phase I/IIa OpRegen trial has been accepted for presentation at the American Academy of Ophthalmology (AAO) annual meeting being held in New Orleans, November 11-14, 2017.
BioTime expanded its ophthalmology program with the signing of a revised and expanded licensing agreement with Hadassah Medical Organization of Jerusalem, Israel. The revised and expand license agreement increases BioTime’s field-of-use for RPE cells to all eye disorders, and also adds photoreceptor cells for all eye disorders.
AST-OPC1 (oligodendrocyte progenitor cells)

In June, BioTime’s affiliate, Asterias Bio-Therapeutics (NYSE MKT: AST) announced new 9-month follow-up data from the company’s ongoing SCiStar Phase I/IIa clinical trial. The results showed that previously reported meaningful improvements in arm, hand and finger function in the 10 million cell cohort treated with AST-OPC1 cells have been maintained and in some patients have been further enhanced 9 months following dosing.
The FDA has accepted Asterias’ amendment to the clinical research protocol for the SCiStar trial to include patients with a C-4 spinal cord injury, the second most common form of cervical spinal cord injury.
Liquid Biopsy (lung cancer confirmatory blood test)

In May, BioTime’s affiliate, OncoCyte (NYSE MKT: OCX) presented positive results from its 300-patient multi-site R&D validation study for its lung cancer diagnostic test at the American Thoracic Society 2017 International Conference (ATS) in Washington, D.C. Results from this study of the optimized final predictive algorithm confirmed the data from a previous study completed in 2016 and further validate the test’s commercial potential.
OncoCyte is on track to launch its lung cancer confirmatory liquid biopsy diagnostic test in 2017. The test could eventually replace a high percentage of invasive, risky, and expensive lung biopsies with simple blood tests, improving outcomes for patients while also capturing significant cost savings for the U.S. healthcare system. The test targets a market opportunity believed to exceed $4 billion annually.
Simplification and Unlocking Value

New Subsidiary AgeX Therapeutics, Inc.

In April, BioTime announced the formation of AgeX Therapeutics, Inc. a new subsidiary that will focus on applying technology relating to cell immortality and regenerative biology, to aging and age-related diseases. AgeX has three initial areas of product development: pluripotent stem cell-derived brown adipocytes (AGEX-BAT1); vascular progenitors (AGEX-VASC1); and induced Tissue Regeneration (iTR). Initial planned indications for these products are Type II diabetes, cardiac ischemia, and cancer, respectively.
In August, AgeX closed an equity financing to raise $10 million. The transaction values AgeX at approximately $68 million. BioTime retains approximately 87% ownership of AgeX.
Value of Holdings in Public Affiliates

At June 30, 2017, BioTime held common stock in publicly-traded affiliates valued at $153.5 million. This amount was the market value of BioTime’s 21.7 million shares in Asterias Bio-Therapeutics (NYSE MKT: AST) and 14.7 million shares in OncoCyte (NYSE MKT: OCX).

Second Quarter Financial Results

Cash Position and Marketable Securities: Cash, cash equivalents, restricted cash in escrow, and available for sale securities totaled $20.9 million as of June 30, 2017, compared to $24.7 million as of March 31, 2017.

Revenues: BioTime’s revenue is generated primarily from research grants, licensing fees and royalties, and subscription and advertising from the marketing of online database products. Total revenue was $381,000 for the second quarter of 2017, compared to $1.3 million in the second quarter of 2016.

Operating Expenses: Operating expenses for the second quarter of 2017 were $10.7 million. On an adjusted basis, operating expenses were $8.8 million, of which $7.5 million was mainly attributable to our clinical programs, $0.8 million in expenses is expected to be funded by AgeX investors going forward and $0.5 million was incurred by our subsidiary LifeMap Solutions, expenses, which are not expected to recur.

Our operating expenses for the six months ended June 30, 2017 were $22.3 million. Adjusted operating expenses were $18.2 million for this period, including $14.4 million spent on our clinical and early stage programs. The remaining $3.8 million in expenses were contributed by OncoCyte during the period in 2017 in which it was consolidated or were in areas to be funded by AgeX going forward; these expenses are not expected to recur.

Cash expenditures in the first half of 2017 were higher than normal due to annual bonuses, AgeX formation costs and some project-based, non-recurring legal expenses. Cash expenditures were further impacted in the second quarter of 2017 due to timing of the payments of certain expenses, including executive bonuses and an extra payroll period.

The reconciliation between GAAP and non-GAAP operating expenses by entity, is provided in the financial tables included with this press release.

R&D Expenses: Research and development expenses were $6.3 million for the second quarter of 2017, compared to $8.9 million for the comparable period in 2016, a decrease of $2.6 million. This decrease was primarily attributable to the deconsolidation of Asterias in May 2016 and OncoCyte in February 2017.

G&A Expenses: General and administrative expenses were $4.4 million for the second quarter of 2017 compared to $6.6 million for the comparable period in 2016. The $2.2 million decrease was primarily due to the deconsolidation of Asterias and OncoCyte.

Net Income or loss attributable to BioTime: Net loss attributable to BioTime was $11.7 million, or ($0.11) per basic and diluted common share for the three months ended June 30, 2017, compared to net income of $24.5 million, or $0.26 per basic and diluted common share for the three months ended June 30, 2016. For the six months ended June 30, 2017, net income attributable to BioTime was $37.6 million, or $0.34 per diluted common share, compared to $7.4 million, or $0.08 per share for the six months ended June 30, 2016. Results in each period were primarily driven by noncash deconsolidation gains and noncash gains and losses in the changes in share prices of our public affiliate investments in Asterias and OncoCyte common stock.