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Genomic Health Announces Third Quarter 2017 Financial Results and Reports Recent Business Progress

On November 8, 2017 Genomic Health, Inc. (NASDAQ: GHDX) reported financial results and business progress for the quarter ended September 30, 2017 (Press release, Genomic Health, NOV 8, 2017, View Source [SID1234521794]).

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Total revenue was $83.8 million in the third quarter of 2017, compared with $82.3 million in the third quarter of 2016, an increase of 2 percent. Revenue was negatively impacted by approximately $3 million due to the hurricane disruption in certain regions of the United States.
U.S. product revenue was $70.9 million in the third quarter of 2017, compared with $70.0 million in the third quarter of 2016. U.S. invasive breast revenue from Oncotype DX Breast Recurrence Score tests was $63.1 million in the third quarter of 2017, compared with $64.6 million in the third quarter of 2016. U.S. prostate revenue from Oncotype DX Genomic Prostate Score (GPS) tests was $5.5 million in the third quarter of 2017, compared with $2.3 million in the third quarter of 2016.

International product revenue was $12.9 million in the third quarter of 2017, compared with $12.1 million in the third quarter of 2016, an increase of 7 percent.

"In the third quarter, we generated solid results including a 2 percent increase in revenue and a 5 percent increase in test volume, despite disruption in U.S. regions affected by hurricanes. We also reported a net loss of $2.2 million, and on a non-GAAP basis delivered a $1.1 million profit in the third quarter. Importantly, we expect to deliver full-year profit, excluding transaction costs from our collaboration with Biocartis," said Kim Popovits, chairman of the board, chief executive officer and president of Genomic Health. "We look forward to significant revenue drivers in 2018 including a new higher Medicare rate under PAMA and anticipated TAILORx results, while we expand our business model to increase worldwide access through the development of an in vitro diagnostic, or IVD, version of the Oncotype DX breast cancer test."

More than 31,580 Oncotype test results were delivered in the third quarter of 2017, an increase of 5 percent, compared with more than 29,990 test results delivered in the same period in 2016. U.S. test volume was negatively impacted by approximately 3 percent due to the hurricane disruption in certain regions of the country. Oncotype DX Breast Recurrence Score tests delivered in the U.S. were consistent with the third quarter of the prior year. Oncotype DX Genomic Prostate Score tests delivered in the U.S. grew 39 percent compared with the third quarter of the prior year. International tests delivered grew 14 percent compared with the same period of the prior year and represented approximately 26 percent of total test volume in the third quarter of 2017.
Operating loss for the third quarter of 2017 improved to $2.6 million, compared with $3.0 million for the third quarter of 2016. Net loss was $2.2 million, or $0.06 per share, for the third quarter of 2017, compared with a net loss of $2.8 million, or $0.08 per share, for the third quarter of 2016. Basic and diluted net loss per share was $0.06 for the third quarter of 2017, compared with basic and diluted net loss per share of $0.08 for the third quarter of 2016.
Total revenue for the nine months ended September 30, 2017 was $253.3 million compared with $245.1 million for the nine months ended September 30, 2016, an increase of 3 percent. On a constant currency basis, revenue increased 4 percent compared with the same period in the prior year.i
International product revenue was $39.4 million for the nine months ended September 30, 2017, compared with $34.8 million for the nine months ended September 30, 2016, an increase of 13 percent, and an increase of 16 percent on a constant currency basis.i
Operating loss improved to $8.6 million for the nine months ended September 30, 2017, compared with an operating loss of $16.9 million for the nine months ended September 30, 2016. Net loss was $5.7 million, or $0.17 per share, for the nine months ended September 30, 2017, compared with a net loss of $15.3 million, or $0.46 per share, for the nine months ended September 30, 2016.
Cash and cash equivalents and short-term marketable securities at September 30, 2017 were $119.0 million, compared with $97.0 million at December 31, 2016 which included the fair value of the company’s investment in a marketable security of $9.3 million at December 31, 2016.
The non-GAAP financial measures used adjust for specified items that can be highly variable or difficult to predict. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures is included in the tables accompanying this release.

2017 Financial Outlook

·
The company expects to deliver full-year profit, excluding the $3.2 million cost of the Biocartis transaction.
·
The company expects to meet the low end of its full year revenue guidance, which is $345 million, excluding the estimated hurricane impact on revenue of approximately $3 million in the third quarter.

Recent Business Highlights

·
Palmetto GBA, a Medicare Administrative Contractor (MAC) that assesses molecular diagnostic technologies, issued a positive final Local Coverage Determination (LCD) that became effective on October 9, 2017 to expand Medicare coverage of the Oncotype DX Genomic Prostate Score test to qualified patients with favorable intermediate-risk prostate cancer throughout the U.S.
·
Established additional private coverage for the Oncotype DX Genomic Prostate Score test, bringing the total number of U.S. covered lives to more than 66 million.
·
Established new private coverage for the Oncotype DX Breast Recurrence Score test in Germany, bringing the total number of German private covered lives to 15 million.

·
Announced an exclusive agreement with Biocartis Group NV to develop an IVD version of the Oncotype DX Breast Recurrence Score test on Biocartis’ Idylla platform that can be performed locally by laboratory partners and in hospitals around the world to broaden future global patient access.
·
European Urology published results from a large, community-based, multi-center clinical validation study conducted at Kaiser Permanente. The results confirmed that the Oncotype DX GPS test is a strong independent predictor of prostate cancer-specific death and metastases at 10 years in men with localized prostate cancer.
·
Presented results from four studies that provide additional evidence of the unmatched value of the Oncotype DX Breast Recurrence Score test in accurately predicting outcomes in early-stage breast cancer patients at the European Society for Medical Oncology (ESMO) (Free ESMO Whitepaper) 2017 Congress.
·
Nature Partner Journals Breast Cancer, a peer-reviewed journal published by Nature, published two articles highlighting results from a large prospectively designed registry conducted by Clalit Health Services, the largest Health Maintenance Organization in Israel. The results reinforce the ability of the Oncotype DX Breast Recurrence Score test to predict clinical outcomes in both node-negative and node-positive patients.
·
Received acceptance to present nine studies at the 2017 San Antonio Breast Cancer Symposium (SABCS) in December.
Conference Call Details
To access the live conference call today, November 8, at 4:30 p.m. Eastern Time via phone, please dial (877) 303-7208 from the United States and Canada, or +1 (224) 357-2389 internationally. The conference call ID is 5697809. Please dial in approximately ten minutes prior to the start of the call. To access the live and subsequently archived webcast of the conference call, go to the Investor Relations section of the company’s web site at View Source Please connect to the web site at least 15 minutes prior to the presentation to allow for any software download that may be necessary.

Inovio Pharmaceuticals Reports 2017 Third Quarter Financial Results

On November 8, 2017 Inovio Pharmaceuticals, Inc. (NASDAQ:INO) reported financial results for the quarter ended September 30, 2017 (Press release, Inovio, NOV 8, 2017, View Source [SID1234521796]).

Total revenue was $2.6 million for the three months ended September 30, 2017, compared to $12.5 million for the same period in 2016. Total operating expenses were $31.8 million for the current year quarter compared to $32.7 million for the prior year quarter.

The net loss attributable to common stockholders for the quarter ended September 30, 2017 was $34.1 million, or $0.39 per basic share, compared to $20.8 million, or $0.28 per share, for the quarter ended September 30, 2016. The increase in net loss for the quarter resulted primarily from lower revenue recognized from our DARPA Ebola grant and a higher non-cash accounting expense related to the change in fair value of our investment in an affiliated entity.

Revenue

The decrease in revenue was primarily due to lower revenues recognized due to the nearing of successful completion of our DARPA Ebola grant.

Operating Expenses

Research and development expenses for the third quarter of 2017 were $25.5 million compared to $27.0 million for the third quarter of 2016. The decrease in R&D expenses was primarily the result of lower expenses incurred related to our DARPA Ebola grant. General and administrative expenses were $6.3 million for the third quarter of 2017 versus $5.8 million for the third quarter of 2016. The increase in G&A expenses was primarily related to an increase in employee headcount.

Capital Resources

As of September 30, 2017, cash and cash equivalents and short-term investments were $141.9 million compared with $104.8 million as of December 31, 2016. At quarter end the company had 90.3 million shares of common stock outstanding and 99.7 million shares of common stock outstanding on a fully diluted basis.

Inovio’s balance sheet and statement of operations are provided below. The Form 10-Q providing the complete 2017 third quarter financial report can be found at: View Source

Corporate Update

Cancer Immunotherapies

VGX-3100: Cervical Pre-Cancer (Phase 3)

In June, Inovio commenced its phase 3 clinical program to evaluate the efficacy of Inovio’s DNA-based immunotherapy, VGX-3100, to treat cervical dysplasia caused by human papillomavirus (HPV). In a little over three months since trial initiation, Inovio has opened nearly 35 sites, recruiting and dosing patients. The company is on track to open at least 50 sites by the end of the year.

VGX-3100: Vulvar Pre-Cancer (Phase 2)

In April, Inovio commenced a randomized, open-label phase 2 trial to evaluate the efficacy of VGX-3100 in women with high-grade HPV-related vulvar high-grade intraepithelial lesions (HSIL), a disease with a high unmet medical need. The primary endpoint of the study is histologic clearance of high-grade lesions and virologic clearance of the HPV virus in vulvar tissue samples. The study will also evaluate safety and tolerability. There are 10 sites in the U.S. open and recruiting patients.

MEDI0457: HPV-Related Head & Neck Cancer (Phase 1/2)

In May, Inovio announced that MedImmune, AstraZeneca’s global biologics research and development arm, commenced a new clinical trial investigating the combination of MEDI0457 (formerly INO-3112, in-licensed from Inovio), an immunotherapy designed to generate antigen-specific killer T cell responses targeting HPV-associated tumors, and durvalumab (IMFINZI), MedImmune’s PD-L1 checkpoint inhibitor. The combination trial will enroll patients with metastatic HPV-associated squamous cell carcinoma of the head and neck (SCCHN) with persistent or recurrent disease after chemotherapy treatment. This study marks a significant moment for Inovio as it transitions into a late-stage biotechnology company. MedImmune is investigating elevating the response rate of checkpoint inhibitors by using durvalumab in combination with a DNA plasmid vaccine originally licensed from Inovio, which has shown the ability to generate killer T cells.

INO-5401: Metastatic bladder cancer phase 1/2 trial initiated in combination with Genentech’s TECENTRIQ

In October, Inovio initiated a phase 1b/2 immuno-oncology trial to evaluate Genentech/Roche’s atezolizumab (TECENTRIQ) in combination with Inovio’s INO-5401, a T cell activating immunotherapy encoding multiple antigens, and INO-9012, an immune activator encoding IL-12. The multi-center, open-label efficacy trial will be managed by Inovio, and Genentech will supply atezolizumab. The trial is evaluating the safety, immune response and clinical efficacy of the combination therapy in approximately 80 patients with advanced bladder cancer, specifically advanced unresectable or metastatic urothelial carcinoma (UC), the most common type of bladder cancer. The majority of the patients to be enrolled in the trial will have previously received and failed to demonstrate meaningful response to an anti-PD-1 or PD-L1 checkpoint inhibitor alone. Thus, the study will evaluate the potential benefit of a checkpoint inhibitor combined with a DNA-based immunotherapeutic and T cell activator within a bladder cancer patient population with very limited treatment options and poor outcomes.

INO-5401: Glioblastoma phase 1/2 trial initiated in combination with Regeneron’s PD-1 inhibitor

In November, Inovio initiated a phase 1b/2a immuno-oncology trial in patients with newly diagnosed glioblastoma (GBM) designed to evaluate Regeneron’s PD-1 inhibitor, REGN2810, in combination with Inovio’s INO-5401 and INO-9012. The open-label trial of 50 patients will be conducted at approximately 30 U.S. sites, and will evaluate safety, tolerability, immune responses as well as progression-free survival and overall survival. GBM is the most aggressive brain cancer and its prognosis is extremely poor, despite a limited number of new therapies approved over the last 10 years. The median overall survival for patients receiving standard of care therapy is approximately 15 months, and the average five-year survival rate is less than three percent.

INO-5150: Prostate cancer immunotherapy slowed PSA rise in patients with recurrent prostate cancer

An interim data analysis from an ongoing open-label phase 1b study showed that Inovio’s INO-5150 cancer immunotherapy product generated antigen-specific CD8+ killer T cell responses measured in peripheral blood from subjects with biochemically recurrent prostate cancer. In the study, INO-5150 treatment as a monotherapy generated prostate specific antigen (PSA) and prostate specific membrane antigen (PSMA) specific T cell responses in peripheral blood in 60% of the subjects. Moreover, patients with specific CD8+ T cell responses experienced dampening in the rise of PSA and significant increases in PSA Doubling Times (PSADT). PSA is a prostate cancer-associated biomarker, and positive changes in PSA levels could signal INO-5150’s potential positive impact on the treatment of prostate cancer.

dMAb shrunk prostate tumors and protected against antibiotic-resistant bacterial infection in published preclinical studies

Two peer-reviewed scientific papers highlighted the potential impact of dMAb constructs on prostate tumors and in preventing infection from a pneumonia-causing bacteria in preclinical studies. A journal article detailed how Inovio’s dMAb construct against PSMA produced monoclonal antibodies that shrank prostate tumors in a preclinical animal model. This research publication is significant because it is the first to report on the use of Inovio dMAb technology to develop novel monoclonal antibody-based therapies against cancer targets. In another first, Inovio also published results of studies in which its dMAb constructs targeting antibiotic-resistant bacteria protected mice when challenged with a lethal dose of drug-resistant pseudomonas, a pneumonia-causing bacteria.

Infectious Disease Vaccines

Positive Zika vaccine clinical data published in New England Journal of Medicine

In October, Inovio reported positive safety and immune response results from a first-in-man, multi-center phase 1 trial of a vaccine against the Zika virus. The phase 1 trial of Inovio’s DNA-based Zika vaccine (GLS-5700) induced high levels of binding antibodies in 100% of participants. Robust neutralizing antibody and T cell immune response were also observed in vaccinated subjects. These positive results were published in the New England Journal of Medicine in the article, titled "Safety and Immunogenicity of an Anti-Zika Virus DNA Vaccine," authored by Inovio researchers and collaborators. A second phase 1 study, now fully enrolled with 160 participants in Puerto Rico, is designed with a placebo control to explore a potential trend towards clinical efficacy. Inovio is the first company to generate positive human data that clearly supports advancement of DNA technology and its Zika vaccine candidate.

Fully-funded phase 1/2 MERS trial initiated in South Korea

Following approval by the Korean Ministry of Food and Drug Safety, in September, Inovio and its development partner, GeneOne Life Science, initiated a study to evaluate GLS-5300, Inovio’s vaccine against the MERS virus (Middle East Respiratory Syndrome), in a phase 1/2a trial. The International Vaccine Institute (IVI) is fully funding this trial utilizing a $34 million grant from the Samsung Foundation provided to IVI in 2015 to support the development of a MERS vaccine. This phase 1/2a trial represents the second clinical trial of GLS-5300, which remains the first and only MERS vaccine being tested in humans. In the first phase 1 MERS study conducted in the United States, high levels of binding antibodies were measured in 92% of evaluated subjects. Significant antigen-specific cytotoxic T-lymphocyte (CTL) responses were also observed.

Lassa fever vaccine advances

Demonstrating its commitment to global public health, in October, Inovio announced positive results of a preclinical study in which a DNA vaccine provided protection against the Lassa fever virus, which infects about 300,000 people annually. In the study, partnered with U.S. Army scientists and fully funded by a grant from the NIH, Inovio’s DNA vaccine provided 100% protection for non-human primates challenged with a lethal dose of the Lassa fever virus. Inovio’s DNA-based platform is especially well-suited to rapidly respond to viral outbreaks and newly emerging pathogens due to its safety profile, ease and speed of development and manufacturing, as well as the ability to be shipped and stored without a cold-chain environment.

MacroGenics Provides Update on Corporate Progress and Third Quarter 2017 Financial Results

On November 8, 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 September 30, 2017 (Press release, MacroGenics, NOV 8, 2017, View Source [SID1234521799]).

"We continue to be encouraged by data we’ve seen across multiple product candidates in our diverse pipeline. At the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) 32nd Annual Meeting later this week, we will have five posters relating to our various PD-1-based programs, including MGA012 (anti-PD-1) and our two PD-1-based DART molecules," said Scott Koenig, M.D., Ph.D., President and CEO of MacroGenics. "Also, in addition to the Phase 1 flotetuzumab data presented recently at the European Society for Medical Oncology Annual Congress (ESMO) (Free ESMO Whitepaper), we look forward to having two posters and an oral presentation with updated clinical data, at the 59th Annual Meeting of the American Society of Hematology (ASH) (Free ASH Whitepaper) in December. Finally, we are thrilled to work with our new collaboration partner, Incyte, to expand the current development efforts for MGA012 and accelerate our own efforts to investigate combinations of MGA012 with multiple molecules in MacroGenics’ portfolio."

Key Pipeline Highlights

Flotetuzumab. Enrollment of the Phase 1 dose expansion study of flotetuzumab, a bispecific DART molecule that recognizes both CD123 and CD3, is ongoing in patients with acute myeloid leukemia (AML) and myelodysplastic syndrome (MDS). Recent highlights include:

In September, MacroGenics presented clinical data from its ongoing Phase 1 study of flotetuzumab in an oral session at ESMO (Free ESMO Whitepaper). Flotetuzumab demonstrated acceptable tolerability in the dose escalation portion of the study with encouraging initial anti-leukemic activity observed in AML patients. As of the data cut-off date of August 1, of the 14 response-evaluable patients treated at the threshold dose, six (43%) experienced an objective response. This included four (28%) patients who achieved a CR/CRi, with one patient who had a molecular CR.
MacroGenics will present updated clinical data in an oral presentation at ASH (Free ASH Whitepaper) in December 2017.
PD-1-Directed Immuno-Oncology Franchise. MacroGenics is advancing several PD-1-directed programs, which are designed to 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. Enrollment in the dose escalation portion of the Phase 1 study of this anti-PD-1 antibody has been completed and the data have been accepted for poster presentation at the upcoming SITC (Free SITC Whitepaper) meeting. MGA012 is currently being evaluated as monotherapy across four solid tumor types in the dose expansion portion of the Phase 1 study. In October 2017, MacroGenics entered into an exclusive global collaboration and license agreement with Incyte Corporation for MGA012, in which Incyte obtained exclusive worldwide rights for the development and commercialization of MGA012. MacroGenics retains the right to pursue its core strategy to develop its pipeline assets in combination with MGA012. The Company plans to initiate the first study of MGA012 in combination with another internal program by year end 2017.
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 is enrolling the dose escalation portion of the Phase 1 study and will present a preclinical data poster as well as a Trials-in-Progress poster describing the Phase 1 study at SITC (Free SITC Whitepaper).
MGD019. MacroGenics continues to advance a preclinical bispecific DART molecule that provides co-blockade of PD-1 and CTLA-4, resulting in enhanced T-cell activation. The Company is conducting activities to support the potential submission of an Investigational New Drug (IND) application for MGD019 in 2018 and will present a preclinical data poster at SITC (Free SITC Whitepaper).
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 and collaborators continue to recruit patients in multiple ongoing studies of enoblituzumab, an Fc-optimized monoclonal antibody that targets B7-H3. These studies include a combination study with an anti-PD-1 antibody and a neoadjuvant prostate cancer study.
MGD009: This DART molecule targets B7-H3 and CD3 and is being evaluated in a Phase 1 study across multiple solid tumor types. The Company continues to explore the dose and schedule for MGD009 administration.
MGC018: The Company is conducting activities to support the potential submission of an IND application for this anti-B7-H3 antibody drug conjugate in 2018.
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 believes it is on track to complete and announce the results of an interim futility analysis by year-end 2017 or early 2018 and to complete 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 two 30 patient expansion cohorts in 2017 and present clinical data during the first half of 2018.
Additional DART Clinical Programs. Other DART molecules being led by MacroGenics in Phase 1 clinical development include MGD007 (gpA33 x CD3) for colorectal cancer and MGD014 (HIV x CD3) for HIV. Updates on these programs include:

MGD007. MacroGenics continues to recruit patients with colorectal cancer in a Phase 1 study and is evaluating various expansion cohorts to define a recommended dose and schedule.
MGD014. MacroGenics’ IND submission for MGD014 was cleared by FDA and the Company anticipates that a first patient will be dosed in early 2018.
Corporate Update

Incyte Collaboration. In October 2017, MacroGenics and Incyte Corporation entered into an exclusive global collaboration and license agreement for MGA012. Under this agreement, MacroGenics will receive an upfront payment of $150 million and could receive up to $750 million in potential development, regulatory and commercial milestones. If MGA012 is approved and commercialized, MacroGenics would be eligible to receive royalties, tiered from 15 percent to 24 percent, on future sales of MGA012 by Incyte. The transaction is expected to close in the fourth quarter of 2017, subject to the early termination or expiration of any applicable waiting periods under the Hart-Scott-Rodino Act and customary closing conditions.
GMP Manufacturing. Construction progress on MacroGenics’ GMP manufacturing suite remains on track. The Company anticipates that the 5 x 2,000 liter single-use bioreactor facility will be operational in 2018. As part of the MGA012 collaboration with Incyte, MacroGenics retains the right to manufacture a portion of both companies’ global clinical and commercial supply needs of MGA012.
Third Quarter 2017 Financial Results

Cash Position: Cash, cash equivalents and marketable securities as of September 30, 2017, were $203.6 million, compared to $285.0 million as of December 31, 2016. MacroGenics anticipates receipt of the $150 million upfront payment from Incyte upon closing of the transaction in the fourth quarter of 2017.
Revenue: Total revenue, consisting primarily of revenue from collaborative agreements, was $1.7 million for the quarter ended September 30, 2017, compared to $3.3 million for the quarter ended September 30, 2016. 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 $41.0 million for the quarter ended September 30, 2017, compared to $30.3 million for the quarter ended September 30, 2016. This increase was primarily due to the initiation of the MGA012 Phase 1 study and continued enrollment in multiple ongoing clinical trials.
G&A Expenses: General and administrative expenses were $8.4 million for the quarter ended September 30, 2017, compared to $7.2 million for the quarter ended September 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 $47.0 million for the quarter ended September 30, 2017, compared to net loss of $33.8 million for the quarter ended September 30, 2016.
Shares Outstanding: Shares outstanding as of September 30, 2017 were 36,807,112.
Conference Call Information

MacroGenics will host a conference call today at 4:30 pm (ET) to discuss financial results for the quarter ended September 30, 2017 and provide a corporate update. To participate in the conference call, please dial (877) 303-6253 (domestic) or (+1) (973) 409-9610 (international) five minutes prior to the start of the call and provide the Conference ID: 5477659.

The recorded, listen-only webcast of the conference call can be accessed under "Events & Presentations" in the Investor Relations section of the Company’s website at View Source A replay of the webcast will be available shortly after the conclusion of the call and archived on the Company’s website for 30 days following the call.

MacroGenics Provides Update on Corporate Progress and Third Quarter 2017 Financial Results

On November 8, 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 financial results for the quarter ended September 30, 2017 (Press release, MacroGenics, NOV 8, 2017, View Source [SID1234521800]).

Key Pipeline Highlights
Flotetuzumab. Enrollment of the Phase 1 dose expansion study of flotetuzumab, a bispecific DART molecule that recognizes both CD123 and CD3, is ongoing in patients with acute myeloid leukemia (AML) and myelodysplastic syndrome (MDS). Recent highlights include:
•
In September, MacroGenics presented clinical data from its ongoing Phase 1 study of flotetuzumab in an oral session at ESMO (Free ESMO Whitepaper). Flotetuzumab demonstrated acceptable tolerability in the dose escalation portion of the study with encouraging initial anti-leukemic activity observed in AML patients. As of the data cut-off date of August 1, of the 14 response-evaluable patients treated at the threshold dose, six (43%) experienced an objective response. This included four (28%) patients who achieved a CR/CRi, with one patient who had a molecular CR.
•
MacroGenics will present updated clinical data in an oral presentation at ASH (Free ASH Whitepaper) in December 2017.
PD-1-Directed Immuno-Oncology Franchise. MacroGenics is advancing several PD-1-directed programs, which are designed to 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. Enrollment in the dose escalation portion of the Phase 1 study of this anti-PD-1 antibody has been completed and the data have been accepted for poster presentation at the upcoming SITC (Free SITC Whitepaper) meeting. MGA012 is currently being evaluated as monotherapy across four solid tumor types in the dose expansion portion of the Phase 1 study. In October 2017, MacroGenics entered into an exclusive global collaboration and license agreement with Incyte Corporation for MGA012, in which Incyte obtained exclusive worldwide rights for the development and commercialization of MGA012. MacroGenics retains the right to pursue its core strategy to develop its pipeline assets in combination with MGA012. The Company plans to initiate the first study of MGA012 in combination with another internal program by year end 2017.

•
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 is enrolling the dose escalation portion of the Phase 1 study and will present a preclinical data poster as well as a Trials-in-Progress poster describing the Phase 1 study at SITC (Free SITC Whitepaper).
•
MGD019. MacroGenics continues to advance a preclinical bispecific DART molecule that provides co-blockade of PD-1 and CTLA-4, resulting in enhanced T-cell activation. The Company is conducting activities to support the potential submission of an Investigational New Drug (IND) application for MGD019 in 2018 and will present a preclinical data poster at SITC (Free SITC Whitepaper).

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 and collaborators continue to recruit patients in multiple ongoing studies of enoblituzumab, an Fc-optimized monoclonal antibody that targets B7-H3. These studies include a combination study with an anti-PD-1 antibody and a neoadjuvant prostate cancer study.
•
MGD009: This DART molecule targets B7-H3 and CD3 and is being evaluated in a Phase 1 study across multiple solid tumor types. The Company continues to explore the dose and schedule for MGD009 administration.
•
MGC018: The Company is conducting activities to support the potential submission of an IND application for this anti-B7-H3 antibody drug conjugate in 2018.
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 believes it is on track to complete and announce the results of an interim futility analysis by year-end 2017 or early 2018 and to complete 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 two 30 patient expansion cohorts in 2017 and present clinical data during the first half of 2018.
Additional DART Clinical Programs. Other DART molecules being led by MacroGenics in Phase 1 clinical development include MGD007 (gpA33 x CD3) for colorectal cancer and MGD014 (HIV x CD3) for HIV. Updates on these programs include:
•
MGD007. MacroGenics continues to recruit patients with colorectal cancer in a Phase 1 study and is evaluating various expansion cohorts to define a recommended dose and schedule.
•
MGD014. MacroGenics’ IND submission for MGD014 was cleared by FDA and the Company anticipates that a first patient will be dosed in early 2018.
Corporate Update

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Incyte Collaboration. In October 2017, MacroGenics and Incyte Corporation entered into an exclusive global collaboration and license agreement for MGA012. Under this agreement, MacroGenics will receive an upfront payment of $150 million and could receive up to $750 million in potential development, regulatory and commercial milestones. If MGA012 is approved and commercialized, MacroGenics would be eligible to receive royalties, tiered from 15 percent to 24 percent, on future sales of MGA012 by Incyte. The transaction is expected to close in the fourth quarter of 2017, subject to the early termination or expiration of any applicable waiting periods under the Hart-Scott-Rodino Act and customary closing conditions.
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GMP Manufacturing. Construction progress on MacroGenics’ GMP manufacturing suite remains on track. The Company anticipates that the 5 x 2,000 liter single-use bioreactor facility will be operational in 2018. As part of the MGA012 collaboration with Incyte, MacroGenics retains the right to manufacture a portion of both companies’ global clinical and commercial supply needs of MGA012.
Third Quarter 2017 Financial Results
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Cash Position: Cash, cash equivalents and marketable securities as of September 30, 2017, were $203.6 million, compared to $285.0 million as of December 31, 2016. MacroGenics anticipates receipt of the $150 million upfront payment from Incyte upon closing of the transaction in the fourth quarter of 2017.
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Revenue: Total revenue, consisting primarily of revenue from collaborative agreements, was $1.7 million for the quarter ended September 30, 2017, compared to $3.3 million for the quarter ended September 30, 2016. Revenue from collaborative agreements includes the recognition of deferred revenue from payments received in previous periods as well as payments received during the period.
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R&D Expenses: Research and development expenses were $41.0 million for the quarter ended September 30, 2017, compared to $30.3 million for the quarter ended September 30, 2016. This increase was primarily due to the initiation of the MGA012 Phase 1 study and continued enrollment in multiple ongoing clinical trials.
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G&A Expenses: General and administrative expenses were $8.4 million for the quarter ended September 30, 2017, compared to $7.2 million for the quarter ended September 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.
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Net Loss: Net loss was $47.0 million for the quarter ended September 30, 2017, compared to net loss of $33.8 million for the quarter ended September 30, 2016.
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Shares Outstanding: Shares outstanding as of September 30, 2017 were 36,807,112.

Medtronic Announces Preliminary Second Quarter Revenue

On November 8, 2017 Medtronic plc (NYSE:MDT) reported its preliminary revenue for its second quarter of fiscal year 2018, which ended October 27, 2017. The company announced preliminary second quarter worldwide revenue of approximately $7.050 billion, a decrease of 4 percent as reported, with the decline driven by the company’s divestiture of its Patient Care, Deep Vein Thrombosis (Compression), and Nutritional Insufficiency businesses to Cardinal Health that occurred at the beginning of the quarter. Second quarter revenue increased 3 percent on a comparable, constant currency basis, which adjusts for the divestiture and a $35 million positive impact from foreign currency (Press release, Medtronic, NOV 8, 2017, View Source;p=RssLanding&cat=news&id=2315619 [SID1234521801]). Excluding the impact of Hurricane Maria, second quarter revenue growth would have been 4 percent on a comparable, constant currency basis.

The company announced that the impact of Hurricane Maria was approximately $55 to $65 million to its second quarter revenue and is expected to be approximately $0.03 to its second quarter non-GAAP earnings per share (EPS). The company was able to limit the financial impact versus its original expectations provided on October 6th due to the performance and resilience of its employees driving a faster-than-anticipated recovery of its operations in Puerto Rico. As expected, the majority of the impact was to its Minimally Invasive and Restorative Therapies Groups in the United States.

On September 20th, Hurricane Maria devastated the island of Puerto Rico and incapacitated Medtronic’s four manufacturing plants. Within two weeks, on October 2nd the company had substantially repaired its four Puerto Rico manufacturing facilities and restarted limited production, with production reaching 50 to 60 percent capacity by October 9th, and ramping to near pre-hurricane capacity by October 18th.

Medtronic’s primary focus has been to support the well-being of its more than 5,000 direct and contract employees on the island and restore its operations to full productivity. The company has and continues to provide critical supplies for its people in Puerto Rico, including water, food, temporary housing, medical care, counseling services, child care, laundry facilities, and power generators.

Despite ongoing island infrastructure challenges, the company is now fully prepared for sustained operations on the island. Medtronic took several actions to restore its manufacturing operations, including implementing on-site and redundant power generator systems; alternate technologies for telecommunication and data connectivity; access to critical suppliers and production materials; and shipping, transportation, and logistics capabilities. As a result, the company was able to minimize the impact of the hurricane on both its supply to customers as well as the company’s second quarter financial results.

"The creativity, dedication, and persistence of our employees – both on and off the island – in dealing with the aftermath of Hurricane Maria was simply incredible. In particular, our employees in Puerto Rico made countless selfless contributions, despite extensive impact to their personal lives, coming to work every day to ensure customers and patients worldwide received our products," said Omar Ishrak, Medtronic chairman and chief executive officer. "Through the efforts of our team, along with help from the local government and the U.S. FDA, we were able to achieve extraordinary results with our Puerto Rico operations over the month of October, well exceeding our initial expectations. I am extremely proud of our passionate employees whose tireless dedication was critical in restoring our operations."

Second Quarter EPS Guidance

Excluding the impact of Hurricane Maria, Medtronic today reiterated its expectation that second quarter adjusted EPS would be flat to slightly up on a comparable, constant currency basis from the prior year comparable EPS of $1.04. The company expects a one cent positive impact to adjusted EPS from foreign currency. Adjusted EPS guidance does not include any charges or gains that would be reported as non-GAAP adjustments to earnings.

Webcast Information

Medtronic will report financial results for the second quarter of fiscal year 2018 and provide an outlook for its fiscal year on Tuesday, November 21, 2017. This is one week earlier than the preliminary date previously provided by the company. A news release will be issued at approximately 5:45 a.m. Central Standard Time (CST) and will be available at View Source Medtronic will host a webcast at 7:00 a.m. CST to discuss its financial results. The webcast can be accessed at View Source on November 21, 2017. Within 24 hours of the webcast, a replay and transcript of the prepared remarks will be available by clicking on the Investor Events link at View Source.

Looking ahead, Medtronic plans to report its fiscal 2018 third and fourth quarter financial results on Tuesday, February 20, 2018, and Thursday, May 24, 2018, respectively. Confirmation and additional details will be provided closer to the specific quarterly earnings release date.

Non-GAAP Schedule

To view the Preliminary FY18 Second Quarter Non-GAAP Reconciliation schedule, click here. The document can also be accessed by visiting newsroom.medtronic.com.