On August 2, 2017 AstraZeneca and its haematology research and development centre of excellence, Acerta Pharma, reported that the US Food and Drug Administration (FDA) has accepted and granted Priority Review for the New Drug Application (NDA) for acalabrutinib, a highly-selective, potent, Bruton tyrosine kinase (BTK) inhibitor (Press release, AstraZeneca, AUG 2, 2017, View Source [SID1234519969]).

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The NDA is based on results from the Phase II ACE-LY-004 clinical trial, which evaluated the safety and efficacy of acalabrutinib in patients with relapsed/refractory mantle cell lymphoma (MCL) who have received at least one prior therapy. This follows the FDA’s recent Breakthrough Therapy Designation for acalabrutinib.

Sean Bohen, Executive Vice President, Global Medicines Development and Chief Medical Officer, said: "FDA’s acceptance of the acalabrutinib application and Priority Review illustrates the impact it could have on patients with relapsed or refractory mantle cell lymphoma as we work to bring this potential medicine to those in need as quickly as possible."

Priority Review is granted to applications for medicines that, if approved, would offer a significant improvement in the safety or effectiveness of the treatment, diagnosis, or prevention of serious conditions.1 The Prescription Drug User Fee Act (PDUFA) date is during the first quarter of 2018.

Flavia Borellini, PhD, Acerta Pharma Chief Executive Officer, said: "We believe acalabrutinib has the potential to be a very important treatment option for patients with this life-threatening blood cancer. The FDA’s NDA acceptance exemplifies our progress in the acalabrutinib development programme and continues our momentum as we seek to transform care for people with haematologic malignancies."

Results from the ACE-LY-004 clinical trial will be submitted for presentation at a forthcoming medical meeting. The acalabrutinib development programme includes both monotherapy and combination therapy strategies in a broad range of blood cancers and solid tumours. The programme includes the Phase III ACE-LY-308 clinical trial evaluating acalabrutinib as a 1st-line treatment for patients with MCL.2


About mantle cell lymphoma (MCL)

Mantle cell lymphoma (MCL) is an aggressive B-cell non-Hodgkin lymphoma (NHL) with poor prognosis.3,4,5,6 MCL accounts for approximately 3% to 6% of new NHL cases in Western countries each year, with an annual incidence of 0.5 per 100,000 persons and an estimated prevalence of 3.5/100,000.5,7 The median age at diagnosis is 68 years, with a 3:1 male predominance.5

About acalabrutinib

Acalabrutinib is a highly-selective, potent, covalent inhibitor of Bruton tyrosine kinase (BTK) with minimal off-target activity observed in pre-clinical trials.8,9,10 This potential new medicine is in development for the treatment of multiple B-cell and other cancers. The acalabrutinib development programme includes both monotherapy and combination therapy strategies in chronic lymphocytic leukaemia (CLL), MCL, Waldenström macroglobulinemia (WM), follicular lymphoma, diffuse large B-cell lymphoma, and multiple myeloma, as well as monotherapy and combination trials in solid tumours. In total, more than 25 acalabrutinib clinical trials with more than 2,000 patients are underway or have completed. Acalabrutinib was granted Orphan Drug Designation by the FDA for the treatment of patients with MCL in September 2015 and by the European Commission in March 2016 for the treatment of patients with CLL, MCL and WM. Acalabrutinib was granted Breakthrough Therapy Designation by the FDA in August 2017 for the treatment of patients with MCL who have received at least one prior therapy. Acalabrutinib is a potential new medicine not approved for any current use.

On August 2, 2017 Ono Pharmaceutical Co., Ltd. (“The Company”) reported its consolidated financial results for three months ended June 30, 2017 (Press release, Ono, AUG 2, 2017, View Source [SID1234519982]).

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The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRSs”).

This First Quarter Flash Report 2018 (unaudited) is summary information extracted from the financial statements announced, and the financial statements and the figures contained herein are prepared for reference only for the convenience of readers outside Japan with certain modifications and reclassifications made from the original financial statements presented in Japanese language.

The translations of Japanese yen amounts into U.S. dollar amounts are included solely for the convenience of readers outside Japan using the rate of 112 to $1, the approximate rate of exchange at June 30, 2017.

Amounts of less than one million yen and one thousand U.S. dollars have been rounded to the nearest million yen and one thousand U.S. dollars in the presentation of the accompanying consolidated financial statements.

Financial Highlights
Ono Pharmaceutical Co., Ltd. and Consolidated Subsidiaries

Revenue ¥ 58,757 ¥ 244,797 ¥ 60,913 $ 543,865 Profit (Owners of the parent company) Total equity 477,791 524,211 510,218 4,555,517 Total assets 540,405 617,461 577,330 5,154,731 Basic earnings per share ¥ 25.81 ¥ 105.27 ¥ 22.31 $ 0.20 Diluted earnings per share ¥ 25.81 ¥ 105.26 ¥ 22.31 $ 0.20 105,129 ONO PHARMACEUTICAL CO., LTD. Thousands of US$ Annual 12 months 2017 3 months ended Jun. 30, US$ 13,680 1st Quarter 3 months ended Jun. 30, 2016 55,793 11,774 1st Quarter 2017 Millions of yen ended Mar. 31, 2017 1st Quarter 3 months ended Jun. 30, 1
First Quarter (April 1 – June 30, 2017) Flash Report (unaudited) Three months ended June 30, 2017

Future Outlook
Ono Pharmaceutical Co., Ltd. and Consolidated Subsidiaries
Revenue ¥ 112,500 $ 1,004,464 ¥ 236,000 $ 2,107,143 Operating profit 13,200 117,857 36,500 325,893 Profit before tax 14,500 129,464 39,000 348,214 Profit 10,700 95,536 29,000 258,929 (Owners of the parent company) Basic earnings per share ¥ 20.19 $ 0.18 ¥ 54.72 $ 0.49

(*)The foregoing are forward-looking statements based on a number of assumptions and beliefs in light of the information currently available to management and are subject to risks and uncertainties. Actual financial results may differ materially depending on a number of economic factors, including conditions and currency exchange rate fluctuations.

Six months ending Year ending Yen US$ Yen US$ September 30, 2017 March 31, 2018 Millions of yen Thousands of US$ Millions of yen Thousands of US$ 2
First Quarter (April 1 – June 30, 2017) Flash Report (unaudited) Three months ended June 30, 2017

Consolidated Statement of Financial Position
Ono Pharmaceutical Co., Ltd. and Consolidated Subsidiaries

Current assets Cash and cash equivalents ¥ 146,323 ¥ 92,491 $ 825,810 Trade and other receivables 73,255 74,435 664,597 Marketable securities 17,560 15,620 139,467 Other financial assets 819 810 7,228 Inventories 25,334 26,733 238,684 Other current assets 7,742 9,990 89,192 Total current assets 271,033 220,078 1,964,979 Non-current assets Property, plant, and equipment 83,659 85,169 760,441 Intangible assets 45,237 49,005 437,549 Investment securities 176,573 184,785 1,649,864 Investments in associates 114 119 1,063 Other financial assets 26,836 26,708 238,462 Deferred tax assets 10,739 7,685 68,619 Other non-current assets 3,271 3,781 33,755 Total non-current assets 346,428 357,252 3,189,752 Total assets ¥ 617,461 ¥ 577,330 $ 5,154,731 ASSETS As of March 31, 2017 As of June 30, 2017 As of June 30, 2017 Millions of yen Thousands of US$ 3
Current liabilities Trade and other payables ¥ 30,905 ¥ 27,736 $ 247,645 Borrowings 423 436 3,891 Other financial liabilities 5,814 5,320 47,497 Income taxes payable 24,777 3,746 33,446 Provisions 6,086 7,134 63,700 Other current liabilities 14,928 12,743 113,781 Total current liabilities 82,933 57,115 509,959 Non-current liabilities Borrowings 542 468 4,180 Other financial liabilities 11 12 106 Retirement benefit liabilities 2,805 2,658 23,734 Provisions 30 30 268 Deferred tax liabilities 881 893 7,972 Long-term advances received 5,276 5,170 46,158 Other non-current liabilities 772 766 6,837 Total non-current liabilities 10,316 9,997 89,255 Total liabilities 93,250 67,112 599,214 Equity Share capital 17,358 17,358 154,985 Capital reserves 17,144 17,155 153,173 Treasury shares (59,382) (81,881) (731,078) Other components of equity 51,752 58,844 525,393 Retained earnings 492,237 493,596 4,407,110 Non-controlling interests 5,101 5,145 45,935 Total equity 524,211 510,218 4,555,517 Total liabilities and equity ¥ 617,461 ¥ 577,330 $ 5,154,731 Millions of yen Thousands of US$ Equity attributable to owners of the parent company 519,110 505,073 4,509,582 LIABILITIES AND EQUITY As of June 30, 2017 As of March 31, 2017 As of June 30, 2017 4
First Quarter (April 1 – June 30, 2017) Flash Report (unaudited) Three months ended June 30, 2017

Consolidated Statement of Income
Ono Pharmaceutical Co., Ltd. and Consolidated Subsidiaries Revenue
¥ 58,757 ¥ 60,913 $ 543,865 Cost of sales (16,202) (15,140) (135,176) Gross profit 42,555 45,773 408,689 Selling, general, and administrative expenses (14,054) (16,240) (144,999) Research and development costs (11,119) (14,938) (133,376) Other income 21 62 555 Other expenses (159) (382) (3,410) Operating profit 17,244 14,275 127,459 Finance income 1,531 1,523 13,594 Finance costs (540) (8) (69) 10 6 50 Profit before tax 18,245 15,796 141,035 Income tax expense (4,541) (3,992) (35,644) Profit for the period 13,704 11,804 105,391 Profit for the period attributable to: Owners of the parent company 13,680 11,774 105,129 Non-controlling interests 24 29 261 Profit for the period 13,704 11,804 105,391 Earnings per share: Basic earnings per share 25.81 22.31 0.20 Diluted earnings per share 25.81 22.31 0.20 Yen US$ Millions of yen Thousands of US$ Share of profit (loss) from investments in associates 1st Quarter 3 months 1st Quarter 3 months ended June 30, 2017 ended June 30, 2016 1st Quarter 3 months ended June 30, 2017 5
First Quarter (April 1 – June 30, 2017) Flash Report (unaudited) Three months ended June 30, 2017

Consolidated Statement of Comprehensive Income
Ono Pharmaceutical Co., Ltd. and Consolidated Subsidiaries Profit for the period
¥ 13,704 ¥ 11,804 $ 105,391 Other comprehensive income: (1,910) 7,084 63,250 (206) 185 1,651 (0) (0) (1) (2,117) 7,269 64,900 Items that may be reclassified subsequently to profit or loss: (470) 19 171 (25) 6 57 (495) 26 228 Total other comprehensive income (loss) (2,612) 7,294 65,129 Total comprehensive income for the period 11,092 19,098 170,519 Comprehensive income for the period attributable to: Owners of the parent company 11,073 19,052 170,103 Non-controlling interests 19 47 416 Total comprehensive income for the period 11,092 19,098 170,519 Net fair value gain (loss) on derivatives under hedge accounting Net gain (loss) on financial assets measured at fair value through other comprehensive income Remeasurement of defined benefit plans Share of net gain (loss) on financial assets measured at fair value through other comprehensive income of investments in associates Millions of yen Thousands of US$ 1st Quarter 3 months ended June 30, 1st Quarter 3 months ended June 30, 2016 Total of items that will not be reclassified to profit or loss Items that will not be reclassified to profit or loss: Total of items that may be reclassified subsequently to profit or loss Exchange differences on translation of foreign operations 1st Quarter 3 months ended June 30, 2017 2017 6
First Quarter (April 1 – June 30, 2017) Flash Report (unaudited) Three months ended June 30, 2017 Consolidated Statement of Changes in Equity Ono Pharmaceutical Co., Ltd. and Consolidated Subsidiaries Share capital Capital reserves Treasury shares Other components of equity Retained earnings Equity attributable to owners of the parent company Noncontrolling interests Total equity Balance at April 1, 2016 ¥17,358 ¥17,103 (¥59,358) ¥43,307 ¥452,983 ¥471,393 ¥4,862 ¥476,255 Profit for the period 13,680 13,680 24 13,704 Other comprehensive income (2,607) (2,607) (5) (2,612) Total comprehensive income for the period – – – (2,607) 13,680 11,073 19 11,092 Purchase of treasury shares (21) (21) (21) Cash dividends (9,540) (9,540) (3) (9,544) Share-based payments 8 8 8 Transfer from other components of equity to retained earnings 206 (206) – – Total transactions with the owners – 8 (21) 206 (9,747) (9,553) (3) (9,556) Balance at June 30, 2016 ¥17,358 ¥17,111 (¥59,379) ¥40,906 ¥456,916 ¥472,912 ¥4,879 ¥477,791 Share capital Capital reserves Treasury shares Other components of equity Retained earnings Equity attributable to owners of the parent company Noncontrolling interests Total equity Balance at April 1, 2017 ¥17,358 ¥17,144 (¥59,382) ¥51,752 ¥492,237 ¥519,110 ¥5,101 ¥524,211 Profit for the period 11,774 11,774 29 11,804 Other comprehensive income 7,277 7,277 17 7,294 Total comprehensive income for the period – – – 7,277 11,774 19,052 47 19,098 Purchase of treasury shares (22,499) (22,499) (22,499) Cash dividends (10,600) (10,600) (3) (10,604) Share-based payments 11 11 11 Transfer from other components of equity to retained earnings (185) 185 – – Total transactions with the owners – 11 (22,499) (185) (10,415) (33,088) (3) (33,091) Balance at June 30, 2017 ¥17,358 ¥17,155 (¥81,881) ¥58,844 ¥493,596 ¥505,073 ¥5,145 ¥510,218 Share capital Capital reserves Treasury shares Other components of equity Retained earnings Equity attributable to owners of the parent company Noncontrolling interests Total equity Balance at April 1, 2017 $154,985 $153,074 ($530,195) $462,070 $4,394,976 $4,634,909 $45,546 $4,680,456 Profit for the period 105,129 105,129 261 105,391 Other comprehensive income 64,974 64,974 155 65,129 Total comprehensive income for the period ––– 64,974 105,129 170,103 416 170,519 Purchase of treasury shares (200,883) (200,883) (200,883) Cash dividends (94,646) (94,646) (28) (94,674) Share-based payments 99 99 99 Transfer from other components of equity to retained earnings (1,651) 1,651 – – Total transactions with the owners – 99 (200,883) (1,651) (92,995) (295,430) (28) (295,458) Balance at June 30, 2017 $154,985 $153,173 ($731,078) $525,393 $4,407,110 $4,509,582 $45,935 $4,555,517 Millions of yen Equity attributable to owners of the parent company Millions of yen Equity attributable to owners of the parent company Thousands of US $ Equity attributable to owners of the parent company 7
First Quarter (April 1 – June 30, 2017) Flash Report (unaudited) Three months ended June 30, 2017 Consolidated Statement of Cash Flows Ono Pharmaceutical Co., Ltd. and Consolidated Subsidiaries Cash flows from operating activities Profit before tax ¥ 18,245 ¥ 15,796 $ 141,035 Depreciation and amortization 1,680 2,217 19,794 Impairment losses 9 – – Interest and dividend income (1,526) (1,488) (13,282) Interest expense 3 4 33 (Increase) Decrease in inventories (1,143) (1,420) (12,683) (Increase) Decrease in trade and other receivables (16,415) (1,186) (10,585) Increase (Decrease) in trade and other payables (268) (3,243) (28,958) Increase (Decrease) in provisions (103) 1,048 9,358 Increase (Decrease) in retirement benefit liabilities 100 120 1,074 Increase (Decrease) in long-term advances received (198) (106) (949) Other 6,752 (7,259) (64,812) Subtotal 7,137 4,483 40,026 Interest received 39 22 194 Dividends received 1,487 1,464 13,071 Interest paid (3) (4) (33) Income taxes paid (6,588) (24,693) (220,475) Net cash provided by (used in) operating activities 2,072 (18,728) (167,218) Cash flows from investing activities Purchases of property, plant, and equipment (8,751) (2,844) (25,392) Purchases of intangible assets (606) (4,478) (39,985) Purchases of investments – (40) (357) Proceeds from sales and redemption of investments 6,000 4,000 35,714 Other (74) 133 1,187 Net cash provided by (used in) investing activities (3,432) (3,229) (28,833) Cash flows from financing activities Dividends paid to owners of the parent company (8,700) (9,310) (83,125) Dividends paid to non-controlling interests (3) (3) (30) Repayments of long-term borrowings (94) (104) (926) Net increase (decrease) in short-term borrowings (12) 18 165 Purchases of treasury shares (20) (22,499) (200,883) Net cash provided by (used in) financing activities (8,830) (31,898) (284,800) Net increase (decrease) in cash and cash equivalents (10,190) (53,855) (480,851) Cash and cash equivalents at the beginning of the period 110,485 146,323 1,306,460 Effects of exchange rate changes on cash and cash equivalents (204) 23 201 Cash and cash equivalents at the end of the period ¥ 100,091 ¥ 92,491 $ 825,810 Millions of yen Thousands of US$ 1st Quarter 3 months ended June 30, 1st Quarter 3 months ended June 30, 2017 1st Quarter 3 months ended June 30, 2016 2017 8
First Quarter (April 1 – June 30, 2017) Flash Report (unaudited) Three months ended June 30, 2017 Sales of Major Products Supplemental Data For information purpose only Opdivo Agent for treatment of unresectable melanoma, unresectable, advanced or recurrent non-small cell lung cancer, unresectable or metastatic renal cell carcinoma, relapsed or refractory classical hodgkin lymphoma, and recurrent or metastatic head and neck cancer ¥ 198 ¥ ᇞ 54 ᇞ 21.4 % ¥ 740 ¥ ᇞ 299 ᇞ 28.8 % Glactiv Agent for type II diabetes 70 ᇞ 7 ᇞ 8.6 % 295 +1 +0.4 % Orencia SC Agent for rheumatoid arthritis 33 +6 +23.1 % 145 +29 +25.2 % Opalmon Circulatory system agent 38 ᇞ 9 ᇞ 18.3 % 140 ᇞ 30 ᇞ 17.8 % Recalbon Agent for osteoporosis 27 ᇞ 2 ᇞ 6.0 % 110 ᇞ 3 ᇞ 2.6 % Forxiga Agent for type II diabetes 26 +8 +45.7 % 100 +22 +28.1 % Rivastach Agent for Alzheimer’s disease 22 ᇞ 0 ᇞ 0.4 % 100 +11 +12.9 % Emend/Proemend Agent for Chemotherapy-induced nausea and vomiting 25 ᇞ 1 ᇞ 3.5 % 100 +1 +1.2 % Kyprolis Agent for relapsed or refractory multiple myeloma 12 +12 60 +40 +206.1 % Onoact Agent for tachyarrhythmia during and post operation 15 +0 +0.5 % 60 +3 +4.8 % Onon Agent for bronchial asthma and allergic rhinitis 13 ᇞ 4 ᇞ 22.9 % 55 ᇞ 13 ᇞ 19.0 % Staybla Agent for overactive bladder (pollakiuria and urinary incontinence) 11 ᇞ 2 ᇞ 17.0 % 45 ᇞ 3 ᇞ 5.7 % Parsabiv Agent for secondary hyperparathyroidism 6 +6 30 +28 +1439.8 % Onon dry syrup Agent for pediatric bronchial asthma and allergic rhinitis 8 ᇞ 3 ᇞ 26.0 % 30 ᇞ 11 ᇞ 26.9 % Foipan Agent for chronic pancreatitis and postoperative reflux esophagitis 8 ᇞ 3 ᇞ 24.9 % 30 ᇞ 8 ᇞ 21.7 % Kinedak Agent for diabetic peripheral neuropathy 6 ᇞ 2 ᇞ 27.7 % 25 ᇞ 4 ᇞ 13.2 % Note: Sales of products are shown in a gross sales basis. Launched in August 2016 Forecast Increase/Decrease Launched in February 2017 Hundreds of Millions of yen 1st Quarter 3 months ended June 30, 2017 Year ending March 31, 2018 Results Increase/Decrease 9
First Quarter (April 1 – June 30, 2017) Flash Report (unaudited) Three months ended June 30, 2017 Breakdown of Revenue Supplemental Data For information purpose only (Hundreds of Millions of yen) 1st Quarter 3 months ended June 30, 2016 1st Quarter 3 months ended June 30, 2017 485 536 124 51 609 588 Note: In “Royalty and Other Revenue”, royalty revenue of “Opdivo Intravenous Infusion” is included, which is 43 hundreds of millions of yen for the 1st quarter 3 months ended June 30, 2016 and 89 hundreds of millions of yen for the 1st quarter 3 months ended June 30, 2017. Information about Revenue by Geographic Area Supplemental Data For information purpose only (Hundreds of Millions of yen) 1st Quarter 3 months ended June 30, 2016 1st Quarter 3 months ended June 30, 2017 　　Japan 484 537 　　Americas 115 43 　　Asia 11 6 　　Europe 0 1 588 609 Note: Revenue by geographic area is attributable to countries or regions based on the customer location. Revenue of Goods and Products Royalty and Other Revenue Total Total 10
First Quarter (April 1– June 30, 2017) Flash Report (unaudited) Three months ended June 30, 2017 Supplemental Information Status of Development Pipeline as of July 28, 2017 I. Main Status of Development Pipelines (Oncology) 1. Development Status in Japan < Approved > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form In-house＊） / In-license Kyprolis for Intravenous Infusion *1 Additional dosage and administration Multiple myeloma / Proteasome inhibitor Injection In-license (Amgen Inc.) Changes from Flash Report for the Fiscal Year ended March 2017 *1: Approval for the partial change in approved items of the manufacturing and marketing approval for Kyprolis for Intravenous Infusion was obtained in Japan for the treatment of patients with relapsed or refractory multiple myeloma. Note: “In-house” compounds include a compound generated from collaborative research. In the case of clinical development of the anticancer compound in the same indication, the most advanced clinical phase is described. < Filed > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Gastric cancer Injection In-house (Co-development with Bristol-Myers Squibb) Note: “In-house” compounds include a compound generated from collaborative research. In the case of clinical development of the anticancer compound in the same indication, the most advanced clinical phase is described. < Clinical Trial Stage > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Phase In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Esophageal cancer Injection III In-house (Co-development with Bristol-Myers Squibb) Additional indication Gastro-esophageal junction cancer and esophageal cancer Injection III In-house (Co-development with Bristol-Myers Squibb) Additional indication Small cell lung cancer Injection III In-house (Co-development with Bristol-Myers Squibb) Additional indication Hepatocellular carcinoma Injection III In-house (Co-development with Bristol-Myers Squibb) Additional indication Glioblastoma Injection III In-house (Co-development with Bristol-Myers Squibb) 11
Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Phase In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Urothelial cancer Injection III In-house (Co-development with Bristol-Myers Squibb) Additional indication Malignant pleural mesothelioma Injection III In-house (Co-development with Bristol-Myers Squibb) Additional indication Ovarian cancer Injection III In-house (Co-development with Bristol-Myers Squibb) Kyprolis for Intravenous Infusion Change of dosage and administration Multiple myeloma / Proteasome inhibitor Injection III In-license (Amgen Inc.) ONO-7643 / Anamorelin New chemical entities Cancer anorexia / cachexia / Ghrelin mimetic Tablet III In-license (Helsinn Healthcare, S.A.) ONO-7702 / Encorafenib New chemical entities Melanoma *2 / BRAF inhibitor Capsule III In-license (Array Biopharma Inc.) ONO-7703 / Binimetinib New chemical Entities Melanoma *3 / MEK inhibitor Tablet III In-license (Array Biopharma Inc.) Opdivo Intravenous Infusion Additional indication Solid tumor (Cervix carcinoma, Uterine body cancer, Soft tissue sarcoma) Injection II In-house (Co-development with Bristol-Myers Squibb) Additional indication Central nervous system lymphoma, Primary testicular lymphoma Injection II In-house (Co-development with Bristol-Myers Squibb) Additional indication Multiple myeloma *4 Injection II In-house (Co-development with Bristol-Myers Squibb) Additional indication Virus positive / negative solid carcinoma Injection I / II In-house (Co-development with Bristol-Myers Squibb) ONO-5371 / Metyrosine New chemical entities Pheochromocytoma / Tyrosine hydroxylase inhibitor Capsule I / II In-license (Valeant Pharmaceuticals North America LLC.) ONO-4686 (BMS-986207) New chemical entities Solid tumor / Anti-TIGIT antibody Injection I / II In-license (Co-development with Bristol-Myers Squibb) ONO-4059 / Tirabrutinib New chemical entities Central nervous system lymphoma *5 / Bruton’s tyrosine kinase (Btk) inhibitor Tablet I / II In-house Opdivo Intravenous Infusion Additional indication Biliary tract cancer Injection I In-house (Co-development with Bristol-Myers Squibb) 12
Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Phase In-house＊） / In-license ONO-4481 (BMS-663513) / Urelumab New chemical entities Solid tumor / Anti-CD137 antibody Injection I In-license (Co-development with Bristol-Myers Squibb) ONO-4482 (BMS-986016) New chemical entities Solid tumor / Anti-LAG-3 antibody Injection I In-license (Co-development with Bristol-Myers Squibb) ONO-4687 (BMS-986227) / Cabiralizumab New chemical entities Solid tumor and hematologic cancer / Anti-CSF-1R antibody Injection I In-license (Co-development with Bristol-Myers Squibb) ONO-7701 (BMS-986205) New chemical entities Solid tumor and hematologic cancer / IDO1 Inhibitor Capsule I In-license (Co-development with Bristol-Myers Squibb) ONO-4483 (BMS-986015) / Lirilumab New chemical entities Solid tumor / Anti-KIR antibody Injection I In-license (Co-development with Bristol-Myers Squibb) ONO-4578 New chemical entities Solid tumor / PG receptor (EP4) antagonist Tablet I In-house Changes from Flash Report for the Fiscal Year ended March 2017 *2: BRAF inhibitor (ONO-7702) is under Phase III for the treatment of melanoma. *3: MEK inhibitor (ONO-7703) is under Phase III for the treatment of melanoma. *4: Phase II of Opdivo was initiated for the treatment of multiple myeloma. *5: Phase I/II of Btk inhibitor (ONO-4059) was initiated for the treatment of central nervous system lymphoma. * Phase I of ONO-7268MX1 and ONO-7268MX2 for the treatment of hepatocellular carcinoma were discontinued due to the strategic reason. Note: “In-house” compounds include a compound generated from collaborative research. In the case of clinical development of the anticancer compound in the same indication, the most advanced clinical phase is described. 13
2. Development Status in S. Korea and Taiwan < Filed > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Area In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Non-small cell lung cancer (Non-Squamous) Injection Taiwan In-house (Co-development with Bristol-Myers Squibb) Additional indication Head and neck cancer Injection Taiwan In-house (Co-development with Bristol-Myers Squibb) Additional indication Hodgkin lymphoma *6 Injection Taiwan In-house (Co-development with Bristol-Myers Squibb) Additional indication Urothelial cancer *7 Injection Taiwan In-house (Co-development with Bristol-Myers Squibb) Additional indication Gastric cancer *8 Injection Taiwan In-house (Co-development with Bristol-Myers Squibb) Changes from Flash Report for the Fiscal Year ended March 2017 *6: A supplemental application for a partial change in the approved items of the importing and marketing approval for Opdivo was submitted in Taiwan for the treatment of hodgkin lymphoma. *7: A supplemental application for a partial change in the approved items of the importing and marketing approval for Opdivo was submitted in Taiwan for the treatment of urothelial cancer. *8: A supplemental application for a partial change in the approved items of the importing and marketing approval for Opdivo was submitted in Taiwan for the treatment of gastric cancer. Note: “In-house” compounds include a compound generated from collaborative research. In the case of clinical development of the anticancer compound in the same indication, the most advanced clinical phase is described. < Clinical Trial Stage > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Phase Area In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Head and neck cancer Injection III South Korea In-house (Co-development with Bristol-Myers Squibb) Additional indication Gastric cancer Injection III South Korea In-house (Co-development with Bristol-Myers Squibb) Additional indication Esophageal cancer Injection III South Korea, Taiwan In-house (Co-development with Bristol-Myers Squibb) Additional indication Gastro-esophageal junction cancer and esophageal cancer Injection III South Korea, Taiwan In-house (Co-development with Bristol-Myers Squibb) Additional indication Small cell lung cancer Injection III South Korea, Taiwan In-house (Co-development with Bristol-Myers Squibb) 14
Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Phase Area In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Hepatocellular carcinoma Injection III South Korea, Taiwan In-house (Co-development with Bristol-Myers Squibb) Additional indication Urothelial cancer Injection III South Korea In-house (Co-development with Bristol-Myers Squibb) ONO-7702 / Encorafenib New chemical entities Colon cancer *9 / BRAF inhibitor Capsule III South Korea In-license (Array Biopharma Inc.) New chemical entities Melanoma *10 / BRAF inhibitor Capsule III South Korea In-license (Array Biopharma Inc.) ONO-7703 / Binimetinib New chemical entities Colon cancer *11 / MEK inhibitor Tablet III South Korea In-license (Array Biopharma Inc.) New chemical entities Melanoma *12 / MEK inhibitor Tablet III South Korea In-license (Array Biopharma Inc.) Opdivo Intravenous Infusion Additional indication Virus positive / negative solid carcinoma Injection I / II South Korea, Taiwan In-house (Co-development with Bristol-Myers Squibb) Changes from Flash Report for the Fiscal Year ended March 2017 *9: BRAF inhibitor (ONO-7702) is under Phase III for the treatment of colon cancer in South Korea. *10: BRAF inhibitor (ONO-7702) is under Phase III for the treatment of melanoma in South Korea. *11: MEK inhibitor (ONO-7703) is under Phase III for the treatment of colon cancer in South Korea. *12: MEK inhibitor (ONO-7703) is under Phase III for the treatment of melanoma in South Korea. Note: “In-house” compounds include a compound generated from collaborative research. In the case of clinical development of the anticancer compound in the same indication, the most advanced clinical phase is described. 15
3. Development Status in Europe and the United States < Approved > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Area In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Urothelial cancer *13 Injection Europe In-house (Co-development with Bristol-Myers Squibb) Changes from Flash Report for the Fiscal Year ended March 2017 *13: Approval for the partial change in approved items of the manufacturing and marketing approval for Opdivo was obtained in Europe for the treatment of patients with locally advanced or metastatic urothelial carcinoma (mUC). Note: “In-house” compounds include a compound generated from collaborative research. In the case of clinical development of the anticancer compound in the same indication, the most advanced clinical phase is described. < Filed > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Area In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Colon cancer Injection USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Hepatocellular carcinoma *14 Injection USA In-house (Co-development with Bristol-Myers Squibb) Changes from Flash Report for the Fiscal Year ended March 2017 *14: A supplemental application for the partial change in approved items of the manufacturing and marketing approval for Opdivo was submitted in USA for the treatment of previously treated hepatocellular carcinoma. Note: “In-house” compounds include a compound generated from collaborative research. In the case of clinical development of the anticancer compound in the same indication, the most advanced clinical phase is described. < Clinical Trial Stage > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Phase Area In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Glioblastoma Injection III Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Small cell lung cancer Injection III Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Hepatocellular carcinoma Injection III Europe In-house (Co-development with Bristol-Myers Squibb) Additional indication Esophageal cancer Injection III Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Multiple myeloma Injection III Europe USA In-house (Co-development with Bristol-Myers Squibb) 16
Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Phase Area In-house＊） / In-license Opdivo Intravenous Infusion Additional indication Gastro-esophageal junction cancer and esophageal cancer Injection III Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Gastric cancer Injection III Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Malignant pleural mesothelioma Injection III Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Diffuse large B cell lymphoma Injection II Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Follicular lymphoma Injection II Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Central Nervous System Lymphoma, Primary Testicular Lymphoma Injection II Europe USA In-house (Co-development with Bristol-Myers Squibb) ONO-4059 / Tirabrutinib New chemical entities B cell lymphoma / Bruton’s tyrosine kinase (Btk) inhibitor Tablet II Europe In-house (Out-license to Gilead Sciences, Inc.) ONO-7579 New chemical entities Solid tumor / Tropomyosin receptor kinase (Trk) inhibitor Tablet I / II Europe USA In-house Opdivo Intravenous Infusion Additional indication Colon cancer Injection I / II Europe In-house (Co-development with Bristol-Myers Squibb) Additional indication Solid tumors (Triple negative breast cancer, Gastric cancer, Pancreatic cancer, Small cell lung cancer, Urothelial cancer, Ovarian cancer) Injection I / II Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Virus positive/negative solid carcinoma Injection I / II Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Hematologic cancer (T-cell lymphoma, Multiple myeloma, Chronic leukemia, etc.) Injection I Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Chronic myeloid leukemia Injection I Europe USA In-house (Co-development with Bristol-Myers Squibb) ONO-4059 / Tirabrutinib New chemical entities B cell lymphoma / Bruton’s tyrosine kinase (Btk) inhibitor Tablet I USA In-house (Out-license to Gilead Sciences, Inc.) ONO-7475 New chemical entities Acute leukemia / Axl / Mer inhibitor Tablet I USA In-house Note: “In-house” compounds include a compound generated from collaborative research. In the case of clinical development of the anticancer compound in the same indication, the most advanced clinical phase is described. 17
II. Main Status of Development Pipelines (Non-Oncology) 1. Development Status in Japan < Filed > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form In-house＊） / In-license Orencia IV Additional indication Juvenile Idiopathic Arthritis / T-cell activation inhibitor Injection In-license (Bristol-Myers Squibb) Note: “In-house” compounds include a compound generated from collaborative research. < Clinical Trial Stage > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Phase In-house＊） / In-license Orencia IV Additional indication Lupus nephritis / T-cell activation inhibitor Injection III In-license (Bristol-Myers Squibb) Orencia SC Additional indication Untreated rheumatoid arthritis / T-cell activation inhibitor Injection III In-license (Bristol-Myers Squibb) Additional indication Primary sjögren syndrome / T-cell activation inhibitor Injection III In-license (Bristol-Myers Squibb) Additional indication Polymyositis / Dermatomyositis *15 / T-cell activation inhibitor Injection III In-license (Bristol-Myers Squibb) ONO-1162 / Ivabradine New chemical entities Chronic heart failure / If channel inhibitor Tablet III In-license (Les Laboratoires Servier) Onoact for Intravenous Infusion 50 mg / 150 mg (ONO-1101) Additional indication for pediatric use Tachyarrhythmia in low cardiac function / Short acting beta 1 blocker Injection II / III In-house Additional indication Ventricular arrhythmia / Short acting beta 1 blocker Injection II / III In-house ONO-2370 / Opicapone New chemical entities Parkinson’s disease / Long acting COMT inhibitor Tablet II In-license (Bial) ONO-8577 New chemical entities Overactive bladder / Bladder smooth muscle relaxant Tablet II In-house Opdivo Intravenous Infusion Additional indication Sepsis *16 Injection I / II In-house (Co-development with Bristol-Myers Squibb) Changes from Flash Report for the Fiscal Year ended March 2017 *15: Phase III of Orencia SC was initiated for the treatment of polymyositis/dermatomyositis. *16: Phase I/II of Opdivo was initiated for the treatment of sepsis. * Phase I of ONO-2160/CD (levodopa pro-drug) for the treatment of parkinson’s disease was discontinued due to no expected treatment effect. Note: “In-house” compounds include a compound generated from collaborative research. 18
2. Development Status in Overseas < Clinical Trial Stage > Product Name / Development Code / Generic Name Classification Target indication / Pharmacological Action Dosage form Phase Area In-house＊） / In-license ONO-4474 New chemical entities Osteoarthritis / Tropomyosin receptor kinase (Trk) inhibitor Capsule II Europe In-house ONO-4059 / Tirabrutinib New chemical entities Sjögren syndrome / Bruton’s tyrosine kinase (Btk) inhibitor Tablet II USA In-house (Out-license to Gilead Sciences, Inc.) Opdivo Intravenous Infusion Additional indication Hepatitis C Injection I Europe USA In-house (Co-development with Bristol-Myers Squibb) Additional indication Sepsis Injection I USA In-house (Co-development with Bristol-Myers Squibb) ONO-8055 New chemical entities Underactive bladder / PG receptor (EP2 / EP3) agonist Tablet I Europe In-house Note: “In-house” compounds include a compound generated from collaborative research.

On August 2, 2017 Exelixis, Inc. (Nasdaq: EXEL) reported financial results for the second quarter of 2017 and provided an update on progress toward fulfilling its key corporate objectives, as well as commercial and clinical development milestones (Press release, Exelixis, AUG 2, 2017, View Source [SID1234519989]).

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Exelixis is focused on maximizing the opportunity for its two internally discovered compounds, cabozantinib and cobimetinib, to improve care and outcomes for people with cancer around the world. The company’s top priority remains the commercialization of CABOMETYX (cabozantinib) tablets as a treatment for patients with advanced renal cell carcinoma (RCC) who have received prior anti-angiogenic therapy. During the second quarter of 2017, CABOMETYX generated $80.9 million in net product revenue, while COMETRIQ (cabozantinib) capsules for the treatment of patients with progressive, metastatic medullary thyroid cancer generated an additional $7.1 million in net product revenue, for a combined $88.0 million in net product revenue for the cabozantinib franchise.

While continuing to execute on the commercialization of CABOMETYX, Exelixis made further progress this quarter on drivers for the company’s future growth. Importantly, an analysis of progression-free survival (PFS) based on the independent radiology review committee (IRC) review of radiographic images from the CABOSUN trial confirmed results per investigator assessment reported earlier. The IRC review was conducted in support of a supplemental New Drug Application (sNDA) filing for cabozantinib as a treatment for patients with previously untreated advanced RCC planned for submission in the third quarter of 2017. In addition, several new trials combining cabozantinib with leading immunotherapies were recently initiated in genitourinary cancer indications. The company also retired the final tranche of its remaining corporate debt, and shortly after the close of the second quarter, announced the favorable settlement of its dispute with Genentech (a member of the Roche Group) concerning cobimetinib, which Exelixis initiated in June 2016.

"The second quarter of 2017 was highlighted by the growth of the cabozantinib franchise, and the significant clinical development, financial and regulatory progress made by the Exelixis team," said Michael M. Morrissey, Ph.D., President and Chief Executive Officer of Exelixis. "With increasing revenues and disciplined financial management, Exelixis is now funding our growth from our operations, giving us the flexibility to invest in clinical trials, evaluate business development opportunities, and reinitiate measured discovery operations that can build long-term value and benefit the patients we serve."

Dr. Morrissey continued: "Shortly after the quarter closed, Exelixis made an important step forward when we and our partner Genentech agreed to a revised revenue and cost-sharing arrangement for cobimetinib’s commercialization in the United States. The new terms provide an equitable foundation for our work with Genentech on this important Exelixis-discovered compound that is now the subject of three phase 3 pivotal trials and multiple earlier stage trials."

Cabozantinib Highlights

Strong Growth in Cabozantinib Franchise Net Revenue. Cabozantinib generated $88.0 million in net product revenue during the second quarter of 2017, an increase of 28 percent from the first quarter of 2017 and an increase of 178 percent year-over-year. The year-over-year increase was driven primarily by the continued U.S. uptake of CABOMETYX following U.S. Food and Drug Administration approval in April 2016 as a treatment for patients with advanced RCC who have received prior anti-angiogenic therapy.

Start of Phase 3 Trial of Cabozantinib in Combination with Nivolumab or with Nivolumab and Ipilimumab in Previously Untreated Advanced or Metastatic RCC. Shortly after the quarter ended, Exelixis and Bristol-Myers Squibb Company (BMS) announced the initiation of CheckMate 9ER, the phase 3 trial evaluating cabozantinib in combination with two of BMS’ leading immunotherapies, nivolumab and ipilimumab, compared to sunitinib. The trial is planned to enroll 1,014 treatment-naïve patients, and the primary endpoint is PFS.

Launch of Phase 1b Trial of Cabozantinib with Atezolizumab in Patients with Locally Advanced or Metastatic Solid Tumors. In June, Exelixis announced the initiation of the dose-escalation stage of a phase 1b trial of cabozantinib in combination with atezolizumab in patients with locally advanced or metastatic urothelial carcinoma (UC) or RCC. The primary objective is to determine the optimal dose and schedule of daily oral administration of cabozantinib when given in combination with atezolizumab to inform the trial’s subsequent expansion stage. Expansion cohorts will evaluate the selected dose and schedule in four settings, including previously untreated RCC patients, previously untreated, both cisplatinum eligible and ineligible UC patients, and previously treated UC patients.

Continued Progress on Filing in Previously Untreated Advanced RCC. During the second quarter, Exelixis announced that the analysis of the review by a blinded IRC had confirmed the primary efficacy endpoint results of investigator-assessed PFS from the CABOSUN randomized phase 2 trial in patients with previously untreated advanced RCC with intermediate- or poor-risk disease. The company remains on track to file its sNDA for cabozantinib in the third quarter of 2017.

CELESTIAL Data Anticipated in the Second Half of 2017. CELESTIAL, the ongoing phase 3 pivotal trial of cabozantinib in patients with advanced hepatocellular carcinoma (HCC), continues to progress. Exelixis is tracking events closely and continues to anticipate that the second interim analysis at 75 percent of the required events will be completed in the second half of 2017.

Cabozantinib and Cobimetinib Data Presentations at the ESMO (Free ESMO Whitepaper) 2017 Congress. Exelixis-discovered compounds will be the subject of 10 presentations at the ESMO (Free ESMO Whitepaper) 2017 Congress, which is being held September 8-12, 2017 in Madrid, Spain. Data from CABOSUN, the randomized phase 2 trial of cabozantinib versus sunitinib in patients with previously untreated advanced RCC, have been accepted as a late-breaking abstract at the meeting and will be the subject of a poster discussion on Sunday, September 10th. Other cabozantinib presentations will include an oral presentation of data from the phase 1b trial of cabozantinib, nivolumab, and ipilimumab in advanced genitourinary malignancies, as well as additional analyses of the METEOR trial in advanced RCC. Cobimetinib presentations at the Congress will include two data sets concerning forms of metastatic melanoma.

Cobimetinib Highlights

Settlement of Arbitration Between Exelixis and Genentech Regarding Companies’ Collaboration Agreement for Cobimetinib. After the quarter ended, Exelixis announced a settlement of our arbitration with Genentech concerning claims asserted by Exelixis against Genentech related to the development and commercialization of cobimetinib, the Exelixis-discovered medicine that is marketed as COTELLIC. The revised revenue and cost-sharing arrangement resolves the companies’ dispute pursuant to the arbitration demand filed on June 3, 2016, and aligns both companies’ interests in advancing cobimetinib as a promising therapy for patients with multiple forms of cancer. Moving forward, the revenue applied to the profit and loss statement for the COTELLIC collaboration (Collaboration P&L) will now be calculated using the average of the quarterly net selling prices of COTELLIC and any additional branded Genentech product(s) prescribed with COTELLIC. Exelixis will continue to share U.S. commercialization costs, while Genentech’s portion of these costs will now be allocated to the Collaboration P&L in proportion to the number of Genentech products in any given combination including COTELLIC. For more detail on the terms, please see Exelixis’ press release and corresponding Form 8-K filed with the U.S. Securities and Exchange Commission (SEC), both issued on July 20, 2017.

Cobimetinib Now the Subject of Three Phase 3 Pivotal Trials. Roche recently confirmed it anticipates enrolling the first patient in IMspire170, the phase 3 pivotal trial of cobimetinib and atezolizumab versus pembrolizumab in first-line BRAF wild-type metastatic or unresectable locally advanced melanoma, in the third quarter of 2017. Alongside the fully enrolled IMblaze370 trial (third-line advanced or metastatic colorectal cancer) and the currently recruiting IMspire150 TRILOGY (first-line BRAF V600 mutation-positive metastatic or unresectable locally advanced melanoma), cobimetinib is now the subject of three phase 3 pivotal trials where it is being evaluated in combination with other anticancer therapies.

Corporate Highlights

Last Source of Indebtedness Retired Through Repayment of the Deerfield Notes. In June 2017, Exelixis retired a series of Secured Convertible Notes originally issued in July 2010 to entities associated with Deerfield Management Company, L.P. (Deerfield Notes). Exelixis retired the Deerfield Notes by making a $123.8 million payment to the Deerfield entities. Repaying the Deerfield Notes a year ahead of their July 2018 maturity date will save Exelixis approximately $12 million in interest expense.

Significant Presence for Cabozantinib and Cobimetinib at the 2017 ASCO (Free ASCO Whitepaper) Annual Meeting. Exelixis-discovered compounds were the subject of 13 presentations, including further analysis of the METEOR study in advanced RCC, as well as updated results from the phase 1b combination trial of cabozantinib plus immunotherapy in genitourinary tumors. Additional cabozantinib data presentations included results from trials in endometrial cancer and uterine carcinosarcoma. Cobimetinib data included updates from the early stage combination trials of cobimetinib plus atezolizumab, and plus atezolizumab and vemurafenib, which have informed the design of several of Roche’s ongoing phase 3 pivotal trials.

2017 Financial Guidance

The company is reiterating its previously provided guidance that total costs and operating expenses for the full year will be between $290 million and $310 million. This guidance includes approximately $25 million of non-cash costs and expenses related primarily to stock-based compensation expense.

Second Quarter 2017 Financial Results

Total revenue for the quarter ended June 30, 2017 was $99.0 million, compared to $36.3 million for the comparable period in 2016. Total revenue includes $88.0 million and $11.0 million of net product revenue and collaboration revenue, respectively, compared to $31.6 million and $4.6 million for the comparable period in 2016. The increase in net product revenues primarily reflects the impact of the commercial launch of CABOMETYX in late April 2016. Collaboration revenues for the quarter ended June 30, 2017 include $5.5 million, $4.1 million and $1.4 million earned under our collaboration agreements with Ipsen, Takeda and Genentech, respectively. In comparison, during the quarter ended June 30, 2016, collaboration revenues include $3.6 million and $1.0 million earned under our collaboration agreements with Ipsen and Genentech, respectively.

Research and development expenses for the quarter ended June 30, 2017 were $28.2 million, compared to $23.0 million for the comparable period in 2016. The increase in research and development expenses was primarily a result of increases in clinical trial costs and personnel expenses. The clinical trial cost increase was predominantly due to increases in costs related to CABOSUN, start-up costs associated with CheckMate 9ER, and start-up costs associated with Exelixis’ phase 1b trial of cabozantinib and atezolizumab in locally advanced or metastatic solid tumors, and were partially offset by a decrease in costs related to METEOR. The increase in personnel-related expenses was primarily a result of an increase in headcount associated with the re-launch of our discovery program and the build-out of our medical affairs organization.

Selling, general and administrative expenses for the quarter ended June 30, 2017 were $40.7 million, compared to $35.8 million for the comparable period in 2016. The increase in selling, general and administrative expenses was primarily a result of increases in personnel expenses resulting primarily from an increase in headcount connected with the build-out and support of the Exelixis U.S. commercial organization, an increase in legal costs, and an increase in consulting and outside services to support our marketing activities. Those increases were partially offset by a decrease in losses under the collaboration agreement with Genentech driven by Genentech’s change in cost allocation approach in January 2017.

Other expense, net for the quarter ended June 30, 2017 was a net expense of $8.9 million, compared to $9.7 million for the comparable period in 2016. The decrease in other expense, net, was primarily due to a decrease in interest expense as a result of the 2016 conversions and redemption of the 4.25% Convertible Subordinated Notes due 2019 and the repayment of the Silicon Valley Bank term loan in March 2017. The decrease in interest expense was partially offset by a $6.2 million loss on extinguishment primarily related to the prepayment penalty associated with the early repayment of the Deerfield Notes on June 28, 2017.

Net income for the quarter ended June 30, 2017 was $17.7 million, or $0.06 per share, basic and diluted, compared to a net loss of $(34.8) million, or $(0.15) per share, basic and diluted, for the comparable period in 2016. The decrease in net loss was primarily due to the increase in net product and collaboration revenues, partially offset by the increase in operating expenses.

Cash and cash equivalents, short- and long-term investments and long-term restricted cash and investments totaled $380.3 million at June 30, 2017, as compared to $479.6 million at December 31, 2016.

Basis of Presentation

Exelixis adopted a 52- or 53-week fiscal year that generally ends on the Friday closest to December 31st. For convenience, references in this press release as of and for the fiscal periods ended June 30, 2017, December 30, 2016 and July 1, 2016 are indicated as being as of and for the periods ended June 30, 2017, December 31, 2016 and June 30 , 2016, respectively.

On August 2, 2017 Clovis Oncology, Inc. (NASDAQ:CLVS) reported financial results for the quarter ended June 30, 2017, and provided an update on the Company’s clinical development programs and regulatory outlook for the remainder of 2017 (Press release, Clovis Oncology, AUG 2, 2017, View Source [SID1234519996]).

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“This is clearly an exciting time for our company, for PARP inhibitors generally, and for Rubraca specifically,” said Patrick J. Mahaffy, President and CEO of Clovis Oncology. “We are actively preparing our supplemental New Drug Application for an all-comers population in the platinum-sensitive ovarian cancer second-line and later maintenance treatment setting based on the ARIEL3 data. We anticipate an opinion on our initial treatment indication in Europe by year-end 2017, and we are preparing our supplemental application in Europe in second-line maintenance treatment to be filed immediately upon receipt of a potential treatment approval, which is anticipated in early 2018. And finally, we are extremely enthusiastic about our clinical collaboration with Bristol-Myers Squibb to explore the combination of Opdivo and Rubraca in triple-negative breast, ovarian and prostate cancers, which could represent a potentially foundational therapy in these and other tumor types.”

Second Quarter 2017 Financial Results

Following the approval and launch of Rubraca on December 19, 2016, Clovis reported net product revenue for Rubraca of $14.6 million for the second quarter of 2017, compared to net product revenue of $7.0 million in the first quarter of 2017 for a total of $21.6 million for the first six months of 2017.

Clovis had $671.5 million in cash, cash equivalents and available-for-sale securities as of June 30, 2017. Cash used in operating activities was $69.1 million for the second quarter of 2017 and $149.5 million for the first half of 2017, compared with $68.0 million and $151.7 million for the comparable periods of 2016. Clovis had approximately 45.2 million shares of common stock outstanding as of June 30, 2017. In January 2017, the Company raised net proceeds of $221.2 million through an offering of 5.75 million shares of common stock and in June 2017, the Company raised net proceeds of $324.9 million through an offering of 3.92 million shares of common stock.

Clovis reported a net loss for the second quarter of 2017 of $175.4 million, or a net loss of $3.88 per share, and $233.8 million, or a net loss of $5.24 per share for the first half of 2017. Net loss was $129.3 million, or a net loss of $3.37 per share for the second quarter of 2016, and $212.7 million, or a net loss of $5.54 per share for the first half of 2016. The net loss for the quarter and six months ended June 30, 2017 included a charge of $117.0 million related to a legal settlement. The net loss for the quarter and six months ended June 30, 2016 included a charge of $104.5 million for the impairment of an intangible asset, a gain of $25.5 million for a reduction in fair value of contingent purchase consideration and a $29.2 million non-cash tax benefit related to lucitanib product rights recorded in 2013 in connection with the Company’s acquisition of Ethical Oncology Science S.p.A. The adjusted net loss excluding these items was $58.4 million or $1.29 per share for the second quarter and $116.8 million or $2.62 per share for the six months ended 2017 and $79.4 million or $2.07 per share for the second quarter and $162.8 million or $4.24 per share for the six months ended 2016. Net loss for the second quarter of 2017 included share-based compensation expense of $10.7 million and $19.6 million for the first half of 2017, compared to $9.5 million and $20.5 million for the comparable periods of 2016.

Research and development expenses totaled $33.1 million for the second quarter of 2017 and $65.6 million for the first half of 2017, compared to $67.7 million and $142.3 million for the comparable periods in 2016. The decrease year over year is primarily due to lower spending on rucaparib and rociletinib development activities and selling, general and administrative expenses related to the commercialization of Rubraca, which had been classified as research and development prior to FDA approval.

Selling, general and administrative expenses totaled $36.1 million for the second quarter of 2017 and $65.4 million for the first half of 2017, compared to $9.6 million and $19.4 million for the comparable periods in 2016. The increase year over year is primarily due to selling, general and administrative expenses related to the commercialization of Rubraca, which had been classified as research and development prior to FDA approval.

New Clinical Collaboration with Bristol-Myers Squibb

Earlier in the week, Clovis and Bristol-Myers Squibb announced a broad clinical collaboration to evaluate the combination of Opdivo and rucaparib in Phase 2 and pivotal Phase 3 clinical trials in multiple tumor types. The pivotal Phase 3 trials will evaluate rucaparib in combination with Opdivo, rucaparib as monotherapy and Opdivo as monotherapy in first-line maintenance treatment for advanced ovarian and advanced triple-negative breast cancers. The Phase 2 trial will evaluate Opdivo in combination with rucaparib and other compounds in metastatic castrate-resistant prostate cancer (mCRPC). These trials are anticipated to begin by the end of 2017. The planned multi-arm clinical trials will be conducted in the U.S., Europe and possibly additional countries. Clovis will be the study sponsor and conducting party for the ovarian cancer study, and Bristol-Myers Squibb will be the study sponsor and conducting party for the breast and prostate cancer studies. Specific terms of the agreement were not disclosed.

ARIEL3 Topline Results

On June 19, Clovis announced topline data from the confirmatory phase 3 ARIEL3 trial of rucaparib, which successfully achieved the primary endpoint of improved progression-free survival (PFS) by investigator review in each of the three populations studied. PFS was also improved in the rucaparib group compared with placebo by blinded independent central review (BICR), a key secondary endpoint.

ARIEL3 is a double-blind, placebo-controlled, phase 3 trial of rucaparib that enrolled 564 women with platinum-sensitive, high-grade ovarian, fallopian tube, or primary peritoneal cancer. The primary efficacy analysis evaluated three prospectively defined molecular sub-groups in a step-down manner: 1) tumor BRCA mutant (tBRCAmut) patients, inclusive of germline and somatic mutations of BRCA; 2) HRD-positive patients, including BRCA-mutant patients and BRCA wild-type with high loss of heterozygosity, or LOH-high patients; and, finally, 3) the intent-to-treat population, or all patients treated in ARIEL3.

Following is a table and a summary of the primary efficacy analyses and selected exploratory PFS endpoints per Response Evaluation Criteria in Solid Tumors (RECIST) version 1.1 by each of investigator review, which was the primary analysis of ARIEL3, and independent review (BICR), a key secondary endpoint of the study.

Summary of Primary Efficacy Analyses and Selected Exploratory Endpoints for ARIEL3
ARIEL3
Analysis Population

PFS by Investigator Review
(Primary Endpoint)

PFS by Blinded Independent Central Review
(Key Secondary Endpoint)
Primary Analyses
Hazard Ratio
Median PFS (months)
Rucaparib vs. Placebo
Hazard Ratio
Median PFS (months)
Rucaparib vs. Placebo
tBRCAmut
0.23; p<0.0001 16.6 vs. 5.4 0.20; p<0.0001 26.8 vs. 5.4 (n=196) HRD-positive 0.32; p<0.0001 13.6 vs. 5.4 0.34; p<0.0001 22.9 vs. 5.5 (n=354) Intent-to-Treat 0.36; p<0.0001 10.8 vs. 5.4 0.35; p<0.0001 13.7 vs. 5.4 (n=564) Exploratory Analyses BRCAwt / HRD-positive 0.44; p<0.0001 9.7 vs. 5.4 0.55; p=0.0135 11.1 vs. 5.6 (n=158) BRCAwt / HRD-negative 0.58; p=0.0049 6.7 vs. 5.4 0.47; p=0.0003 8.2 vs. 5.3 (n=161) PFS: progression-free survival; tBRCAmut: tumor BRCA mutant; HRD: homologous recombination deficiency; BRCAwt: BRCA wild type Exploratory Endpoint of Response Rate Enrollment in ARIEL3 included one-third of patients who had achieved a complete response to their prior platinum-based therapy, and two-thirds of patients who had achieved a partial response to their prior platinum-based therapy. Of those with a partial response, 37% had measurable disease at the time of enrollment and were therefore evaluable for response. The confirmed overall response rate by investigator-assessed RECISTv1.1 in the tBRCAmut group treated with rucaparib was 38% (15/40); of these, 18% (7/40) were complete responses. This compared with 9% (2/23) in the placebo group (p=0.0055). No complete responses were seen in the tBRCAmut placebo group. RECIST responses were also observed in BRCA wild type HRD positive and BRCA wild type HRD negative subgroups. RECIST responses were not assessed by independent blinded review. Summary of ARIEL3 Safety The most common (≥5%) treatment-emergent grade 3/4 adverse events (TEAEs) among all patients treated with rucaparib in the ARIEL3 study were anemia/decreased hemoglobin (19%), ALT/AST increase (11%), asthenia/fatigue (7%), neutropenia (7%), and thrombocytopenia (5%).The discontinuation rate for TEAEs was 14% for rucaparib-treated patients and 2.6% for the placebo arm. The rate of treatment-emergent myelodysplastic syndrome (MDS)/acute myeloid leukemia (AML) in the rucaparib arm was <1% (3/372), and no patients on the placebo arm experienced treatment-emergent MDS/AML. The ARIEL3 data has been accepted at the European Society for Medical Oncology 2017 Congress in Madrid this September. Rucaparib Regulatory Update Based on the ARIEL3 dataset, the Company plans to submit a supplemental New Drug Application (sNDA) by the end of October for a second-line and later maintenance treatment indication for all women with platinum-sensitive ovarian cancer who have responded to their most recent platinum therapy. Clovis’ Marketing Authorization Application (MAA) for rucaparib to the European Medicines Agency for a comparable ovarian cancer treatment indication that was submitted to the U.S. FDA is currently under review. Clovis anticipates an opinion from the Committee for Medicinal Products for Human Use (CHMP) in late 2017, and, pending a favorable opinion from CHMP, a potential approval would follow during the first quarter of 2018. Following a potential approval for the treatment indication, Clovis intends to submit a supplemental application for the second-line or later maintenance treatment indication, for which the Company anticipates a potential approval during the third quarter of 2018. Clovis continues to establish its E.U. organization to support a potential launch of rucaparib. Rucaparib Clinical Development Clovis has a robust clinical development program underway in multiple tumor types, including both Clovis-sponsored and investigator-initiated trials. The following clinical studies are open for enrollment or are anticipated to open during 2017: The Clovis-sponsored ARIEL4 confirmatory study in the treatment setting is a Phase 3 multicenter, randomized study of rucaparib versus chemotherapy in relapsed ovarian cancer patients with BRCA mutations (inclusive of germline and/or somatic) who have failed two prior lines of therapy. The primary endpoint of the study is PFS. This study is currently enrolling patients. The Clovis-sponsored TRITON2 (Trial of Rucaparib in Prostate Indications) study in mCRPC, a Phase 2 single-arm study enrolling patients with BRCA mutations and ATM mutations (both inclusive of germline and somatic) or other deleterious mutations in other homologous recombination (HR) repair genes and all patients will have progressed after receiving one line of taxane-based chemotherapy and one or two lines of androgen-receptor (AR) targeted therapy. This study is currently enrolling patients. The Clovis-sponsored TRITON3 study, a Phase 3 comparative study in mCRPC enrolling BRCA mutant and ATM mutant (both inclusive of germline and somatic) patients who have progressed on AR-targeted therapy and who have not yet received chemotherapy in the castrate-resistant setting is also open for enrollment. TRITON3 will compare rucaparib to physician’s choice of AR-targeted therapy or chemotherapy in these patients. This study is currently enrolling patients. A Clovis-sponsored Phase 3 study in advanced ovarian cancer in the first-line maintenance treatment setting evaluating rucaparib plus the cancer immunotherapy Opdivo (nivolumab; anti-PD1), rucaparib, Opdivo and placebo in newly-diagnosed patients who have completed platinum-based chemotherapy. This study, as part of a broad clinical collaboration with Bristol-Myers Squibb, is expected to begin before the end of 2017. The Phase 3 combination study of the cancer immunotherapy Opdivo plus rucaparib for the treatment of advanced triple-negative breast cancers (TNBC) associated with homologous recombination deficiency (HRD). This study is sponsored by Bristol-Myers Squibb and is expected to begin before the end of 2017. The Phase 2 combination study of the cancer immunotherapy Opdivo plus rucaparib for the treatment of mCRPC. This study, sponsored by Bristol-Myers Squibb, will be conducted as an arm of a larger Bristol-Myers Squibb-sponsored prostate cancer study. This study is expected to begin before the end of 2017. The Phase 1b combination study of the cancer immunotherapy Tecentriq (atezolizumab; anti-PDL1) and rucaparib for the treatment of gynecological cancers, with a focus on ovarian cancer. This study is sponsored by Roche and is currently enrolling patients. The cooperative group-sponsored MITO-25 study evaluating rucaparib and the anti-angiogenic therapy, bevacizumab, in combination as a first-line maintenance therapy for advanced ovarian cancer, which is expected to begin enrolling patients by year-end; and Additional investigator-initiated or cooperative group-initiated studies of rucaparib as single-agent or in combination therapy are underway or planned, including studies in ovarian, prostate, breast, gastroesophageal, pancreatic, lung, bladder and urothelial cancers. Conference Call Details Clovis will hold a conference call to discuss second quarter 2017 results on August 2, at 4:30pm ET. The conference call will be simultaneously webcast on the Company’s web site at www.clovisoncology.com, and archived for future review. Dial-in numbers for the conference call are as follows: US participants 866.489.9022, International participants 678.509.7575, conference ID: 58222782. About Rubraca (rucaparib) Rubraca is a PARP inhibitor indicated as monotherapy for the treatment of patients with deleterious BRCA mutation (germline and/or somatic) associated advanced ovarian cancer, who have been treated with two or more chemotherapies, and selected for therapy based on an FDA-approved companion diagnostic for Rubraca. The indication for Rubraca is approved under the FDA’s accelerated approval program based on objective response rate and duration of response, and is based on results from two multicenter, single-arm, open-label clinical trials. Continued approval for this indication may be contingent upon verification and description of clinical benefit in confirmatory trials. Please visit rubraca.com for more information. About Rucaparib Rucaparib is an oral, small molecule inhibitor of PARP1, PARP2 and PARP3 being developed in ovarian cancer as well as several additional solid tumor indications. During the fourth quarter of 2016, the Marketing Authorization Application (MAA) submission in Europe for rucaparib in the same ovarian cancer treatment indication was submitted and accepted for review. In October 2017, Clovis Oncology intends to submit a supplemental New Drug Application (sNDA) in the U.S. for a second line or later maintenance treatment indication in ovarian cancer based on the ARIEL3 data, and in addition, plans to file an MAA in Europe for the maintenance treatment indication. Studies open for enrollment or under consideration include ovarian, prostate, breast, gastroesophageal, pancreatic, lung, bladder and urothelial cancers. Clovis is also developing rucaparib in patients with mutant BRCA tumors and other DNA repair deficiencies beyond BRCA – commonly referred to as homologous recombination deficiencies, or HRD. Clovis holds worldwide rights for rucaparib.