On August 2, 2017 OncoMed Pharmaceuticals, Inc. (NASDAQ:OMED), a clinical-stage biopharmaceutical company focused on discovering and developing novel anti-cancer therapeutics, reported second quarter financial results (Press release, OncoMed, AUG 2, 2017, View Source [SID1234520005]). As of June 30, 2017, cash and short-term investments totaled $129.8 million.

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"OncoMed continues to focus on discovering and developing novel therapeutics to improve outcomes for cancer patients. The company is advancing our navicixizumab and rosmantuzumab phase 1b clinical trials and our immuno-oncology pipeline, with anti-TIGIT, GITRL-Fc and ongoing immuno-oncology discovery and R&D efforts," said Paul J. Hastings, OncoMed’s Chairman and CEO. "In addition, OncoMed is well positioned, with more than two years cash on the balance sheet and $98 million in potential opt-in payments by 2019."

Pipeline Highlights

Navicixizumab (anti-DLL4/VEGF bispecific; OMP-305B83)

Enrollment continues in two Phase 1b multi-center, open-label, dose escalation and expansion studies of OncoMed’s anti-DLL4/VEGF bispecific antibody in combination with standard of care chemotherapies: one in patients with 2nd line metastatic colorectal cancer and a second in patients with platinum-resistant ovarian cancer who have failed more than 2 prior therapies or prior bevacizumab.
Celgene Partnered — potential $25 million end of Phase 1 opt-in, $505 million in remaining milestones
Rosmantuzumab (anti-RSPO3; OMP-131R10)

Enrollment continues in a Phase 1a/b multi-center, open-label, dose escalation and expansion study of OncoMed’s anti-RSPO3 antibody in patients with advanced solid tumors (Phase 1a) and in patients with previously treated metastatic colorectal or gastric cancer (Phase 1b; in combination with FOLFIRI). As previously announced, the trial is now enrolling only patients that harbor an RSPO3 gene fusion.
Interim Phase 1a results demonstrated the drug was safe and well tolerated.
Celgene Partnered — potential $38 million end of Phase 1 opt-in, $440 million in remaining milestones
Anti-TIGIT (OMP-313M32)

Enrollment continues in a single-agent Phase 1a multi-center, open-label, dose escalation study of OncoMed’s anti-TIGIT antibody in patients with advanced or metastatic solid tumors.
Presented data in the 2nd Quarter from multiple preclinical studies detailing the mechanism of action and anti-tumor activity of anti-TIGIT alone and in combination with checkpoint inhibitors at the AACR (Free AACR Whitepaper) Annual Meeting 2017.
Celgene Partnered – potential $35 million end of Phase 1 opt-in, $440 million in remaining milestones
GITRL-Fc (OMP-336B11)

OncoMed expects to enroll the first-patient in a Phase 1a single agent study of OncoMed’s GITRL-Fc in 2H17
Wholly-owned
Vantictumab (anti-Fzd, OMP-18R5) and Ipafricept (Fzd8-Fc, OMP-54F28)

OncoMed continues to evaluate potential partnering opportunities for Wnt/IO combinations, utilizing different dosing regimens than those used in the Phase 1b studies.
Second Quarter 2017 Financial Results

Cash and short-term investments totaled $129.8 million as of June 30, 2017, compared to $184.6 million as of December 31, 2016.

Revenues were $6.2 million for the second quarter of 2017, a decrease of $0.5 million, compared to $6.7 million for the same period in 2016. The decrease in revenue was primarily due to slightly lower revenue recognized from reimbursement of research and development costs for services performed in the second quarter of 2017.

Research and development (R&D) expenses were $15.1 million for the second quarter 2017, a decrease of $14.6 million, compared to $29.7 million for the same period in 2016. The decrease was primarily due to lower external research and development costs attributable to the decrease in Phase 2 clinical trial costs of demcizumab and tarextumab programs and decrease in internal program costs due to reduced headcount as a result of the restructuring actions in April 2017.

General and administrative (G&A) expenses were $4.1 million for the second quarter of 2017, a decrease of $0.7 million, compared to $4.8 million for the same period in 2016. The decrease was mainly due to a decrease in employee-related costs including stock-based compensation expenses as a result of the restructuring actions in April 2017.

Restructuring charges were $2.4 million for the second quarter of 2017 as a result of the restructuring plan that was implemented in April 2017. The restructuring charges were primarily related to severance and other one-time benefits.

Net loss for the second quarter of 2017 was $15.2 million ($0.40 per share), compared to $27.7 million ($0.91 per share) for the same period of 2016. The change in net loss from the prior year quarter was due to lower R&D and G&A expenses and restructuring charges.

2017 Financial Guidance

OncoMed anticipates 2017 full-year cash expenses will be approximately $90 million. Based on the current plan, OncoMed anticipates that its current cash balance is sufficient to fund pipeline development and company operations through the third quarter of 2019, before considering potential opt-in milestones under our Celgene collaboration.

Following potential opt-in, on a per program basis, OncoMed would be eligible to co-develop and co-commercialize rosmantuzumab and/or navicixizumab with Celgene, while Celgene would assume all downstream costs and development activities for anti-TIGIT. In addition to the $98 million in potential opt-in payments related to these three programs, the company could be eligible to receive approximately $1.5 billion in downstream milestones, plus potential royalties and/or profit-sharing.

On August 2, 2017 MorphoSys AG (FSE: MOR; Prime Standard Segment, TecDAX; OTC: MPSYY), a leader in the field of therapeutic antibodies, reported results for the second quarter of 2017 (Press release, MorphoSys, AUG 2, 2017, View Source [SID1234520004]).

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"We have seen significant progress, both with our own and our partners’ drug candidates in the second quarter of 2017. Our progress was particularly evidenced by the start of a phase 3 trial with our blood cancer compound MOR208. This is the first pivotal study with a compound from our own development portfolio and a major milestone for MorphoSys," said Dr. Simon Moroney, Chief Executive Officer of MorphoSys AG. "More great news for the pipeline came shortly after the quarter ended, when our partner Janssen announced US FDA approval of TremfyaTM (guselkumab) in plaque psoriasis. This is the best possible validation for our antibody technology and a landmark in the history of MorphoSys. We’re extremely happy that TremfyaTM, the first approved product based on our technology, is now available to patients in the US, living with moderate to severe plaque psoriasis."

Financial Review for the second quarter of 2017 (IFRS; all figures rounded)

MorphoSys continues to focus on the research and development of drug candidates. In the second quarter of 2017, group revenues amounted to EUR 11.7 million, comparable with the revenue level in Q2 2016 (EUR 12.2 million).

In the Proprietary Development segment, MorphoSys focuses its activities on research and clinical development of its own drug candidates in cancer and inflammation. In Q2 2017, this segment recorded revenues of EUR 0.3 million (Q2 2016: EUR 0.2 million).

In the Partnered Discovery segment, MorphoSys applies its proprietary technology to discover new antibodies for pharmaceutical companies, receiving R&D funding and licensing fees from its partners and benefiting from the partners’ development progress through success-based milestone payments and royalties. In Q2 2017, revenues in this segment reached EUR 11.5 million (Q2 2016: EUR 12.0 million).

Earnings before interest and taxes (EBIT) in Q2 2017 amounted to EUR -15.4 million (Q2 2016: EUR -9.5 million). As expected, the operational loss reflects increased spending for the clinical development of the Company’s proprietary drug candidates. Three phase 2 studies started with the Company’s lead program MOR208 in blood cancer indications during 2016, one of which transitioned into a phase 3 clinical trial in Q2 2017.

Concurrently with its expanded activities, the Proprietary Development segment reported a quarterly EBIT of EUR -18.3 million after EUR -13.5 million in Q2 2016. EBIT in the Partnered Discovery segment was EUR 6.8 million (Q2 2016: EUR 7.4 million).

In Q2 2017, the consolidated net result amounted to EUR -16.1 million (Q2 2016: EUR -11.6 million). The diluted net result per share for Q2 2017 was EUR -0.55 (Q2 2016: EUR -0.44).

At the end of Q2 2017, the Company had a cash position of EUR 334.8 million compared to EUR 359.5 million on December 31, 2016. On the balance sheet, this cash position is reported under the following items: cash and cash equivalents; available-for-sale financial assets; bonds, available-for-sale; and current and non-current financial assets classified as loans & receivables.

The number of shares issued totaled 29,326,110 at the end of Q2 2017 (year-end 2016: 29,159,770).

Results for the first six months 2017

During the first six months of 2017, group revenues amounted to EUR 23.6 million, in line with the previous year (Q1-Q2 2016: EUR 24.3 million). As expected, R&D expenses for proprietary drug development and technology development increased considerably to EUR 37.9 million in the first half of 2017 (Q1-Q2 2016: EUR 28.3 million). This increase is due to intensified activities in the clinical development of the Company’s proprietary drug candidates which are transitioning into advanced development stages, requiring larger and more elaborate clinical studies. Consequently the EBIT in the first six months of 2017 amounted to EUR -30.3 million, compared to EUR -19.2 million in the first half of 2016.

Financial guidance confirmed

For the financial year 2017, MorphoSys continues to expect Group revenues in the range of EUR 46 to 51 million. R&D expenses for proprietary drug development and technology development are confirmed to be in a corridor of EUR 85 to 95 million. Guidance for earnings before interest and taxes (EBIT) continues to be in the range from EUR -75 to -85 million. This guidance does not include any additional revenue from potential future collaborations and/or licensing partnerships, nor effects from potential in-licensing or co-development deals for new development candidates. This guidance includes a milestone payment for the TremfyaTM approval. Since royalties for TremfyaTM cannot be accurately projected shortly after the approval, the Company will review its guidance as soon as the revenue uptake allows for reliable projections for the financial year 2017.

"Based on our strong cash position, we continue to drive our proprietary portfolio forward. In particular we will focus on the phase 3 development of our blood cancer candidate MOR208. The approval of TremfyaTM marks our transition to a company whose revenues will be increasingly based on recurring income from product sales. This will contribute to the funding of our proprietary development activities," stated Jens Holstein, Chief Financial Officer of MorphoSys AG.

Operational outlook for 2017

In the Proprietary Development segment, MorphoSys expects the following events in 2017:

– MOR208: Presentation of further data from more patients in the ongoing phase 2 trial of MOR208 in combination with lenalidomide in DLBCL (L-MIND study).

– MOR202: Continuation of ongoing phase 1/2a dose-escalation trial in multiple myeloma, including MOR202 in the highest dosing cohorts in combinations with pomalidomide and with lenalidomide.

– MOR209/ES414: Continuation of the current phase 1 trial in prostate cancer (mCRPC) by partner Aptevo based on a dose regimen that was adapted last year. In the second half of the year, MorphoSys expects further clinical data from this study, which will form the basis for evaluating the drug’s further development.

– MOR106: Presentation of results from the ongoing phase 1 trial of MOR106, being co-developed with Galapagos in atopic dermatitis.

– MOR103/GSK3196165: MorphoSys expects data from a phase 2b study and from a phase 2a study in rheumatoid arthritis as well as data from a phase 2a study in hand osteoarthritis, all being conducted by GSK. This HuCAL antibody originated in the Company’s Proprietary Development segment, and has been fully out-licensed to GSK.

In its Partnered Discovery segment, the following events were reported after the end of the reporting period or are further expected:

– TremfyaTM (guselkumab): the first partner-developed therapeutic antibody based on MorphoSys’s HuCAL technology has received FDA approval and is now available to patients in the US, according to MorphoSys’s partner Janssen. Moreover, guselkumab is currently in review for market approval also in Europe.

– After the end of reporting period, MorphoSys’s partner Bayer reported that anetumab ravtansine, an investigational HuCAL-based antibody drug conjugate being developed by Bayer, did not meet the primary endpoint of progression-free survival in a phase 2 trial in the cancer indication mesothelioma. Bayer announced to present detailed study results at an upcoming conference and to continue development of this compound in other cancer indications.

– Novartis collaboration: As previously communicated and as reflected in the Company’s 2017 guidance, the collaboration with Novartis will conclude at the end of November 2017 in accordance with the contract.

– For the remainder of the year, results may be disclosed from up to 25 different clinical studies in various phases conducted by partners with antibodies based on MorphoSys technology.

As always, MorphoSys is in discussions with other companies in the pharmaceutical industry about technology and/or product-based collaborations, with the goal of strengthening its participation in drug programs aimed at unmet medical needs.

MorphoSys Group Key Figures (IFRS, end of reporting period: June 30)

in EUR million Q2 2017 Q2 2016 Change Q1-Q2 2017 Q1-Q2 2016 Change
Revenues 11.7 12.2 -4.1% 23.6 24.3 -2.9%
Total operating expenses 27.5 21.7 26.7% 54.3 43.5 24.8%
R&D expenses 23.0 18.0 27.8% 46.3 36.7 26.2%
thereof expenses for proprietary R&D 18.6 13.8 34.8% 37.9 28.3 33.9%
G&A expenses 4.4 3.7 18.9% 8.0 6.9 15.9%
Operational loss (EBIT) -15.4 -9.5 62.1% -30.3 -19.2 57.8%
Net loss (Net result) -16.1 -11.6 38.8% -31.1 -18.8 65.4%
Net loss per share (diluted, in EUR) -0.55 -0.44 25.0% -1.07 -0.72 48.6%
Cash position (end of period) 334.8 279.7 19.7% 334.8 279.7 19.7%
Equity ratio (end of period) (in %) 87.0 90.0 -3PP* 87.0 90.0 -3PP*
No. of R&D programs (end of period) 114 104 9.6% 114 104 9.6%
No. of clinical programs (end of period) 29 27 7.4% 29 27 7.4%
No. of proprietary clinical programs (end of period) 6** 5** 20.0% 6** 5** 20.0%
* Percentage points
** Thereof one proprietary program fully outlicensed to GSK (MOR103/GSK3196165)

MorphoSys will hold its conference call and webcast today to present the second quarter 2017 and first half 2017 financial results and the further outlook for 2017.

Dial-in number for the analyst conference call (in English) at 2:00 pm CEST; 1:00 pm BST; 8:00 am EDT (listen-only):
Germany: +49 (0) 89 2444 32975
For UK residents: +44 (0) 20 3003 2666
For US residents: +1 202 204 1514

Please dial in 10 minutes before the beginning of the conference. A live webcast and slides will be made available at View Source

Shortly after the conference call, a slide-synchronized audio replay of the conference and a transcript will be available on View Source

The half year report (January – June 2017) (IFRS) is available online:
View Source

MorphoSys will hold a Capital Markets Day on September 5 and 6, 2017.

On August 3, 2017 Roche (SIX: RO, ROG; OTCQX: RHHBY) reported that the US Food and Drug Administration (FDA) has accepted the company’s supplemental New Drug Application (sNDA) and granted Priority Review for Alecensa (alectinib) as an initial (first-line) treatment for people with anaplastic lymphoma kinase (ALK)-positive, locally advanced or metastatic non-small cell lung cancer (NSCLC) as detected by an FDA-approved test (Press release, Hoffmann-La Roche, AUG 2, 2017, View Source [SID1234520002]). The FDA will make a decision on approval by November 30, 2017.

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"Phase III results showed Alecensa reduced the risk of disease worsening by more than half compared to the current standard of care and lowered the risk of tumours spreading to or growing in the brain by more than 80%,"1 said Sandra Horning, MD, Chief Medical Officer and Head of Global Product Development. "We are working closely with the FDA to bring this medicine as an initial treatment for people with ALK-positive NSCLC as soon as possible."

This sNDA submission for Alecensa is based on results from the phase III ALEX and phase III J-ALEX studies. A Priority Review designation is granted to proposed medicines that, if approved, the FDA has determined to have the potential to provide a significant improvement in the safety or effectiveness of the treatment, prevention or diagnosis of a serious disease.

In addition, on March 25, 2017, the European Medicines Agency (EMA) validated the extension of indication application for Alecensa as an initial treatment for people with this specific form of lung cancer. This submission was also based on the pivotal phase III ALEX and J-ALEX studies.

Alecensa received Breakthrough Therapy designation from the FDA in September 2016 for the treatment of adults with advanced ALK-positive NSCLC who have not received prior treatment with an ALK inhibitor. Breakthrough Therapy designation is designed to expedite the development and review of medicines intended to treat serious or life-threatening diseases and to help ensure people have access to them through FDA approval as soon as possible. Breakthrough Therapy designation was granted on the basis of the phase III J-ALEX trial.

Alecensa was granted accelerated approval by the FDA in December 2015 for the treatment of people with ALK-positive metastatic NSCLC who have progressed on or are intolerant to crizotinib.2 The ALEX study is part of the company’s commitment in the US to convert the current accelerated approval of Alecensa in people with ALK-positive, metastatic NSCLC who have progressed on or are intolerant to crizotinib to a full approval as an initial treatment.

About the ALEX and J-ALEX studies1,3
Results from the phase III ALEX study and updated results from the phase III J-ALEX study were recently presented at the 2017 Annual Meeting of the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper). 1,3

ALEX (NCT02075840/B028984) is a randomised, multicentre, open-label phase III study evaluating the efficacy and safety of Alecensa versus crizotinib in treatment-naïve people with ALK-positive NSCLC whose tumours were characterised as ALK-positive by the VENTANA ALK (D5F3) CDx Assay, a companion immunohistochemistry (IHC) test developed by Roche Tissue Diagnostics. People were randomised (one-to-one ratio) to receive either Alecensa or crizotinib. The multicentre study was conducted in 303 people across 161 sites in 31 countries.4 Results include:1
Alecensa reduced the risk of disease worsening or death (progression-free survival, PFS) by 53% compared to crizotinib (hazard ratio [HR]=0.47, 95% CI: 0.34–0.65, p<0.0001).

Investigator-reported median PFS (the primary endpoint) was not yet reached in the Alecensa arm (95% CI: 17.7–not reached) versus 11.1 months (95% CI: 9.1–13.1 months) in the crizotinib arm.

Independent Review Committee (IRC)-reported median PFS (a secondary endpoint) was 25.7 months (95% CI: 19.9–not reached) in the Alecensa arm versus 10.4 months (95% CI: 7.7–14.6 months) in the crizotinib arm (HR=0.50, 95% CI: 0.36–0.70, p<0.0001).

Alecensa reduced the risk of progression in the central nervous system (CNS) by 84% (HR=0.16, 95% CI: 0.10–0.28, p<0.0001) versus crizotinib.

The 12-month cumulative rate of CNS progression for people with or without existing CNS metastases at baseline was 9.4% (95% CI: 5.4%–14.7%) for people treated with Alecensa and 41.4 % (95% CI: 33.2%–49.4%) for people treated with crizotinib.

Overall survival (OS) data are currently considered immature with only about a quarter of events being reported.
Grade 3-5 adverse events (AEs) were less frequent in the Alecensa arm (41%) compared to the crizotinib arm (50%). In the Alecensa arm, the most common Grade 3–5 AEs (≥5%) were increased liver enzymes (alanine transferase and aspartate transferase; 5%) and decreased red blood cells (anaemia; 5%). AEs leading to discontinuation (11% vs. 13%), dose reduction (16% vs. 21%) and dose interruption (19% vs. 25%) were all lower in the Alecensa arm compared to the crizotinib arm.

The J-ALEX study is an open-label, randomised phase III study conducted by Chugai that compared the efficacy and safety of Alecensa with crizotinib in Japanese people. J-ALEX enrolled 207 people with ALK-positive, advanced or recurrent NSCLC who had not been treated with an ALK inhibitor. People were randomised to the Alecensa group or the crizotinib group on a one-to-one ratio.3 Results include:3

Alecensa reduced the risk of disease worsening or death (PFS) by 62% compared to crizotinib (HR=0.38, 95% CI: 0.26–0.55, p<0.0001).

The median PFS was 25.9 months in the Alecensa arm (95% CI: 20.3–not reached) versus 10.2 months (95% CI: 8.3–12.0 months) in the crizotinib arm.

Alecensa reduced the risk of progression in the CNS by 81% (HR=0.19, 95% CI: 0.07-0.53) in people without brain metastases at baseline, and reduced the risk of CNS progression by 49% (HR=0.51, 95% CI: 0.16-1.64) in people with brain metastases at baseline.

Grade 3–4 adverse events (AEs) were less frequent in the Alecensa arm (32%) compared to the crizotinib arm (57%). In the Alecensa arm, the most common grade 3–4 AEs (≥5%) were an increase in muscle enzymes (blood creatine phosphokinase increase; 5%) and interstitial lung disease (5%). AEs leading to discontinuation (11% vs. 23%) and dose interruption (29% vs. 64%) were lower in the Alecensa arm compared to the crizotinib arm.

About Alecensa
Alecensa (RG7853/AF-802/RO5424802/CH5424802) is an oral medicine created at Chugai Research Laboratories and is being developed for people with NSCLC whose tumours are identified as ALK-positive. ALK-positive NSCLC is often found in younger people who have a light or non-smoking history.5 It is almost always found in people with a specific type of NSCLC called adenocarcinoma.5 Alecensa is currently approved in the United States, Europe, Kuwait, Israel, Hong Kong, Canada, South Korea, Switzerland, India, Australia, Singapore and Taiwan for the treatment of advanced (metastatic) ALK-positive NSCLC whose disease has worsened after, or who could not tolerate treatment with, crizotinib and in Japan for people with ALK-positive NSCLC.

The global phase III ALEX study of Alecensa includes a companion test developed by Roche Diagnostics. Alecensa is marketed in Japan by Chugai Pharmaceutical, a member of the Roche Group.

On August 2, 2017 Aduro Biotech, Inc. (NASDAQ: ADRO) reported financial results for the second quarter of 2017 (Press release, Aduro Biotech, AUG 2, 2017, View Source [SID1234520001]). Net loss for the second quarter 2017 was $19.4 million, or $0.27 per share, and for the six months ended June 30, 2017 net loss was $41.2 million, or $0.59 per share, compared to net income of $2.3 million, or $0.04 per share, and net loss of $26.5 million, or $0.41 per share, respectively, for the same periods in 2016.
Cash, cash equivalents and marketable securities totaled $377.2 million at June 30, 2017, compared to $361.9 million at December 31, 2016.

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

•
Established a clinical collaboration with Merck to evaluate the combination of Aduro’s LADD agent CRS-207 with Merck’s anti-PD-1 KEYTRUDA (pembrolizumab) in a Phase 2 trial in mesothelioma cancer and subsequently initiated this trial

•
Received FDA clearance of an Investigational New Drug Application (IND) for the Phase 1b study of Aduro’s ADU-S100 and PDR001, Novartis’ anti-PD-1 checkpoint inhibitor

•
Initiated a Phase 2 clinical trial of CRS-207 in combination with pembrolizumab for patients with previously-treated gastric cancer

•
Earned a $2 million milestone under a worldwide licensing agreement with Merck for work supporting the preparation of an IND for the B-select anti-CD27 monoclonal antibody
Remaining Anticipated 2017 Milestones

•
Initiate Phase 1 pLADD (personalized LADD) trial in certain colorectal cancers

•
Janssen expected to initiate Phase 1b/2 trial of ADU-214 in lung cancer and determine next steps for ADU-741 in prostate cancer

•
Initiate Phase 1b trial of ADU-S100 in combination with anti-PD-1 in collaboration with Novartis

•
Report early results from the Phase 2 mesothelioma study evaluating CRS-207 in combination with pembrolizumab

•
Report preliminary top-line findings from Phase 1 monotherapy trial of ADU-S100

•
File an IND for BION-1301, an anti-APRIL antibody

•
Initiate Phase 1 multiple myeloma trial with BION-1301, an anti-APRIL antibody
Second Quarter 2017 Financial Results
Revenue was $5.9 million for the second quarter of 2017 and $9.7 million for the six months ended June 30, 2017, compared to $39.0 million and $43.0 million, respectively, for the same periods in 2016. The decrease in revenue in both periods is due to the recognition of a $35.0 million milestone payment in the second quarter of 2016 in connection with the clinical advancement of ADU-


S100 under our agreement with Novartis. For the second quarter of 2017, the decrease was partially offset by the recognition of $2.0 million in connection with the achievement of a milestone under our anti-CD27 antibody agreement with Merck.
Research and development expenses were $21.4 million for the second quarter of 2017 and $42.0 million for the six months ended June 30, 2017, compared to $26.9 million and $47.8 million, respectively, for the same periods in 2016. The decrease in research and development expenses in both periods was primarily related to reduced GVAX Pancreas manufacturing and pancreatic cancer clinical trial expenses, partially offset by increased costs to manufacture our B-select antibodies as well as higher personnel and facility related costs in 2017.
General and administrative expenses were $8.3 million for the second quarter of 2017 and $16.5 million for the six months ended June 30, 2017, compared to $8.7 million and $17.7 million, respectively, for the same periods in 2016. The decrease in general and administrative expenses in both periods was primarily related to lower professional services and consulting expenses in 2017, partially offset by higher facility costs in 2017.
Income tax benefit was $3.8 million for the second quarter of 2017 and $6.5 million for the six months ended June 30, 2017, compared to a provision for income taxes of $1.5 million and $4.7 million, respectively, for the same periods in 2016. The income tax benefit recorded in 2017 was due to the current benefit of federal income taxes paid in 2016.

On August 2, 2017 MacroGenics, Inc. (NASDAQ:MGNX), a clinical-stage biopharmaceutical company focused on discovering and developing innovative monoclonal antibody-based therapeutics for the treatment of cancer, as well as autoimmune disorders and infectious diseases, reported a corporate progress update and reported financial results for the quarter ended June 30, 2017 (Press release, MacroGenics, AUG 2, 2017, View Source [SID1234519997]).

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

Key Pipeline Highlights

Margetuximab. Recent highlights related to the Company’s Fc-optimized monoclonal antibody that targets the human epidermal growth factor receptor 2, or HER2, include:

Phase 3 Metastatic Breast Cancer Study. The pivotal SOPHIA study is evaluating the efficacy of margetuximab plus chemotherapy compared to trastuzumab plus chemotherapy in approximately 530 relapsed/refractory HER2-positive metastatic breast cancer patients. MacroGenics remains on track for completing enrollment of this study by late 2018.
Phase 2 Gastric Cancer Study. The Company continues to enroll advanced HER2-positive gastric and gastroesophageal junction cancer patients in its combination study of margetuximab with an anti-PD-1 antibody. MacroGenics expects to complete enrollment of this study in 2017.
B7-H3 Franchise. MacroGenics is developing a portfolio of therapeutics that target B7-H3, a member of the B7 family of molecules involved in immune regulation. The Company is advancing multiple programs that target B7-H3 through complementary mechanisms of action that take advantage of this antigen’s broad expression across multiple solid tumor types. These molecules include:

Enoblituzumab: The Company continues to recruit patients in multiple ongoing studies of enoblituzumab, an Fc-optimized monoclonal antibody that targets B7-H3. These studies include a monotherapy study that includes patients with bladder or prostate cancer and a combination study with an anti-PD-1 antibody.
MGD009: This DART molecule targeting B7-H3 and CD3 is being evaluated in a Phase 1 study across multiple solid tumor types. The Company expects to establish the dose and schedule for MGD009 administration as well as initiate expansion cohorts in multiple tumor types in 2017.
MGC018: The Company is conducting activities to support the submission of an Investigational New Drug (IND) application for this anti-B7-H3 antibody drug conjugate in 2018.
PD-1-Directed Immuno-Oncology Franchise. MacroGenics is advancing several PD-1-directed programs, which will enable both a broad set of combination opportunities across the Company’s portfolio and provide further differentiation from existing PD-1-based treatment options. The first of these are:

MGA012. The Company’s proprietary anti-PD-1 monoclonal antibody is enrolling patients in the dose escalation segment of its Phase 1 clinical study and expects to define a target dose and schedule soon. To date, the antibody has been well tolerated up to 10 mg/kg. With anti-PD-1 therapy becoming a mainstay of cancer treatment across multiple tumor types, MacroGenics believes MGA012 will be the basis for potential combination therapy with several of the molecules in its pipeline. The Company plans to initiate the first such study of MGA012 in combination with another internal program by year end 2017, subject to regulatory feedback.
MGD013. MacroGenics is developing MGD013, a DART molecule, to provide co-blockade of two immune checkpoint molecules expressed on T cells, PD-1 and LAG-3, for the potential treatment of a range of malignancies. The Company’s IND submitted for MGD013 was cleared by FDA in May and commencement of enrollment is expected imminently.
PD-1 x CTLA-4. MacroGenics continues to advance its preclinical bispecific DART and trispecific TRIDENT molecules that bind to and inhibit ligand interaction with PD-1 and CTLA-4, resulting in enhanced T-cell activation. By targeting these clinically validated checkpoint molecules simultaneously, MacroGenics’ DART and TRIDENT proteins hold the promise of enhanced anti-tumor activity together with a simplified development path.
Additional DART Clinical Programs. Other DART molecules being led by MacroGenics in Phase 1 clinical development include flotetuzumab (CD123 x CD3, also known as MGD006 and S80880), MGD007 (gpA33 x CD3) and MGD010 (CD32B x CD79B). Updates on these programs include:

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

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