On November 3, 2015 Compugen Ltd. (NASDAQ: CGEN), a leading predictive drug discovery company, reported financial results for the third quarter ending September 30, 2015 (Filing, 6-K, Compugen, NOV 3, 2015, View Source [SID:1234507901]).

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Anat Cohen-Dayag, Ph.D., President and Chief Executive Officer of Compugen, stated, "We are very pleased by the continuing successful advancement of our early stage target pipeline with programs addressing substantial therapeutic opportunities in immuno-oncology, antibody drug conjugate therapy, and autoimmune diseases, all based on novel targets discovered by us."

Dr. Cohen-Dayag continued, "With respect to our multiple internal immuno-oncology programs, we continue to advance CGEN-15029 as the highest priority mAb program, and as such, have allocated additional resources to this program to advance it to clinical trials. This is a very exciting time for the Company, as we advance our first internal immuno-oncology program toward IND-enabling activities. With respect to programs addressing antibody drug conjugate therapy, we have established a diversified portfolio of target candidates for this promising mode of cancer therapy, and recently disclosed data suggesting broad first-in-class clinical opportunities for CGEN-15027 antibodies in the treatment of multiple solid tumor types."

Dr. Cohen-Dayag, added, "With respect to our collaboration with Bayer HealthCare based on CGEN-15001T and CGEN-15022, both Bayer and Compugen are excited by the potential of the two programs as additional understandings of the target biology are gained and the programs progress toward potential novel therapeutics for cancer immunotherapy."

Revenues for the third quarter of 2015 and for the nine months ending September 30, 2015 were $0.2 million and $1.0 million respectively, compared with $1.7 million and $5.8 million for the comparable periods in 2014. The decrease in revenues is attributable mainly to recognition of the non-refundable upfront payment under the August 2013 collaboration and license agreement with Bayer and a milestone payment in the amount of $1.2 million received in the second quarter of 2014 from Bayer.

Net loss for the third quarter of 2015 was $6.7 million, or $0.13 per basic and diluted share, compared with a net loss of $5.4 million, or $0.11 per basic and diluted share, for the comparable period in 2014. Net loss for the nine months ending September 30, 2015 was $19.7 million, or $0.39 per basic and diluted share, compared with a net loss of $9.6 million, or $0.20 per basic and diluted share, for the comparable period in 2014. The significant increase in net loss for the comparable periods largely relates to a decrease in revenues as noted above, and an increase in the Company’s R&D and business development activities relating to its Pipeline Program candidates.

As of September 30, 2015, cash, cash related accounts, short-term and long-term bank deposits totaled $89.3 million with no debt, compared with $108.4 million as of December 31, 2014.

On November 3, 2015 Incyte Corporation (Nasdaq: INCY) reported 2015 third-quarter financial results, including revenue from Jakafi (Filing, 8-K, Incyte, NOV 3, 2015, View Source [SID:1234507900]).

The Company highlighted the continued strong revenue growth from Jakafi in the U.S. and royalties from sales of Jakavi (ruxolitinib) outside of the U.S. by the Company’s collaborator, Novartis, as well as significant progress across its development portfolio. During November 2015, Incyte expects detailed data from the remaining two Phase III trials of the global registration program for baricitinib in patients with rheumatoid arthritis (RA) to be presented at the American College of Rheumatology (ACR), as well as the first presentation of data from the proof-of-concept trial of epacadostat, Incyte’s selective IDO1 inhibitor, in combination with Merck’s anti-PD-1 antibody, pembrolizumab, at the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper). The Company recently announced an agreement with Merck to expand their clinical collaboration to include a pivotal trial of epacadostat plus pembrolizumab in first-line advanced or metastatic melanoma. Incyte has also recently initiated clinical trials of INCSHR1210, an anti-PD-1 monoclonal antibody, in patients with solid tumors, INCB53914, a selective pan-PIM kinase inhibitor, in hematological malignancies and topical ruxolitinib cream for the treatment of patients with alopecia areata.

"We are very pleased with the continued revenue growth from Jakafi during the third quarter, which was driven by strong underlying demand from both of its approved indications," stated Hervé Hoppenot, Incyte’s President and Chief Executive Officer. "We are successfully executing on our aggressive clinical development plans, and believe that the positive outcome of the pivotal RA development program for baricitinib and the progression of epacadostat into a global Phase III trial are both landmark events as we continue our transformation into a world-leading biopharmaceutical business."

2015 Third-Quarter Financial Results

Revenues For the quarter ended September 30, 2015, net product revenues of Jakafi were $161 million as compared to $98 million for the same period in 2014, representing 65 percent growth. For the nine months ended September 30, 2015, net product revenues of Jakafi were $419 million as compared to $252 million for the same period in 2014, representing 67 percent growth. For the quarter and nine months ended September 30, 2015, product royalties from sales of Jakavi outside of the United States received from Novartis were $18 million and $51 million, respectively, as compared to $12 million and $34 million, respectively, for the same periods in 2014. For the quarter ended September 30, 2015, contract revenues were $8 million as compared to $88 million for the same period in 2014. For the nine months ended September 30, 2015, contract revenues were $40 million as compared to $102 million for the same period in 2014. The $62 million decrease in contract revenues for the nine months ended September 30, 2015 compared to the same period in 2014 relates to a decrease in milestone payments earned from Novartis. For the quarter ended September 30, 2015, total revenues were $188 million as compared to $198 million for the same period in 2014. For the nine months ended September 30, 2015, total revenues were $510 million as compared to $388 million for the same period in 2014.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

Research and development expenses

Research and development expenses for the quarter and nine months ended September 30, 2015 were $132 million and $363 million, respectively, as compared to $89 million and $249 million, respectively, for the same periods in 2014. Included in research and development expenses for the quarter and nine months ended September 30, 2015 were non-cash expenses related to equity awards to our employees of $10 million and $30 million, respectively. The increase in research and development expenses was primarily due to the expansion of the Company’s clinical portfolio, including costs related to external alliances. Also included in research and development expenses for the nine months ended September 30, 2015 was the one-time upfront payment to Agenus related to our license, development and commercialization agreement and for the quarter and nine months ended September 30, 2015, the one-time upfront payment to Jiangsu Hengrui Medicine Co., Ltd. related to our global license and collaboration agreement.

Selling, general and administrative expenses

Selling, general and administrative expenses for the quarter and nine months ended September 30, 2015 were $48 million and $144 million, respectively, as compared to $39 million and $117 million, respectively, for the same periods in 2014. Included in selling, general and administrative expenses for the quarter and nine months ended September 30, 2015 were non-cash expenses related to equity awards to our employees of $8 million and $22 million respectively. Increased selling, general and administrative expenses reflected additional costs related to the commercialization of Jakafi.

Unrealized loss on long term investment

Unrealized loss on long term investment of $31 million and $4 million, respectively, for the quarter and nine months ended September 30, 2015 represents the fair market value adjustments of the Company’s investment in Agenus.

Net income / (loss)

Net loss for the quarter ended September 30, 2015 was $40 million, or $0.22 per basic and diluted share, as compared to net income of $59 million, or $0.35 and $0.33 per basic and diluted share, respectively, for the same period in 2014. Net loss for the nine months ended September 30, 2015 was $49 million, or $0.27 per basic and diluted share as compared to a net loss of $12 million, or $0.07 per basic and diluted share, for the same period in 2014.

Cash, cash equivalents and marketable securities position

As of September 30, 2015, cash, cash equivalents and marketable securities totaled $635 million, as compared to $600 million as of December 31, 2014.

Product Update

Jakafi (ruxolitinib) — JAK1 and JAK2 Inhibitor

The pivotal Phase III JANUS 1 and JANUS 2 studies of ruxolitinib in second line metastatic pancreatic cancer are ongoing. Three Phase II trials of ruxolitinib are ongoing in colorectal, breast and non-small cell lung cancer (NSCLC) patients.

A Phase II trial of topical ruxolitinib cream has begun in patients with alopecia areata, the primary endpoint of which is the percentage of subjects achieving a Severity of Alopecia Tool score (SALT) 50 response in terminal hair (pigmented and non-pigmented) at 24 weeks.

baricitinib — JAK1 and JAK2 Inhibitor

In September 2015, the Company and Eli Lilly and Company ("Lilly") announced that the Phase III RA-BEGIN study of baricitinib met its primary endpoint of non-inferiority of baricitinib monotherapy to methotrexate monotherapy based on ACR20 response rate after 24 weeks of treatment. Additionally, baricitinib was superior to methotrexate based on ACR20 response. The RA-BEGIN study included RA patients who had limited or no prior treatment with methotrexate, and were naïve to other conventional or biologic disease-modifying antirheumatic drugs (DMARDs).

In October 2015, the Company and Lilly announced that the Phase III RA-BEAM study of baricitinib met its primary endpoint of improved ACR20 response compared to placebo after 12 weeks of treatment. The RA-BEAM study also included an active comparator group of RA patients taking Humira (adalimumab)*, and all patients were also treated with background methotrexate. The results of the RA-BEAM trial also showed that baricitinib was superior to adalimumab on key secondary objectives of ACR20 response and improvement in DAS28-hsCRP score after 12 weeks of treatment, and that following 24 weeks of treatment, baricitinib was superior to placebo in preventing progressive radiographic structural joint damage.

epacadostat (INCB24360) — IDO1 Inhibitor

Four clinical trials to evaluate epacadostat in combination with immune checkpoint inhibitors are all recruiting patients. These trials are evaluating epacadostat in combination with Merck & Co’s PD-1 inhibitor Keytruda (pembrolizumab)*, AstraZeneca/MedImmune’s investigational PD-L1 inhibitor, durvalumab, Bristol-Myers Squibb’s PD-1 inhibitor, Opdivo (nivolumab)*, and Roche/Genentech’s investigational PD-L1 inhibitor, atezolizumab.

Initial proof-of-concept results from the combination trial of epacadostat and pembrolizumab are expected to be presented at the upcoming Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) 30th Anniversary Annual Meeting & Associated Programs on November 6.

In October 2015, the Company and Merck & Co. announced an expansion of the companies’ ongoing clinical collaboration to include a Phase III study evaluating the combination of epacadostat with pembrolizumab as a first-line treatment for patients with advanced or metastatic melanoma.

INCB39110 & INCB52793 — JAK1-Selective Inhibitors

INCB39110, in combination with INCB40093, Incyte’s PI3Kδ inhibitor, is in development for patients with B-cell malignancies. INCB39110 is also in a Phase II trial, in combination with gemcitabine and nab-paclitaxel, in patients with pancreatic cancer.

The Company’s second JAK1-selective inhibitor, INCB52793, is in a Phase I/II monotherapy dose-escalation trial in advanced malignancies.

INCB40093 & INCB50465 — PI3Kδ Inhibitors

INCB40093 is in clinical development in combination with the JAK1-selective inhibitor INCB39110 in B-cell malignancies. An open-label, dose-escalation monotherapy study of INCB50465 in subjects with previously treated B-cell malignancies is underway.

capmatinib (INC280) — c-MET Inhibitor

Capmatinib is being investigated by Novartis in a variety of solid tumors, including advanced c-MET positive hepatocellular carcinoma, c-MET positive/EGFR-TKI-resistant NSCLC and glioblastoma multiforme, as well as in combination, including with Bristol-Myers Squibb’s PD-1 immune checkpoint inhibitor, nivolumab, in a Phase II trial of patients with NSCLC.

INCB54828 — FGFR Inhibitor

INCB54828 is in an open-label, dose-escalation study in subjects with advanced malignancies.

INCB54329 — BRD Inhibitor

INCB54329 is in an open-label, dose-escalation study in subjects with advanced malignancies.

INCSHR1210 — PD-1 inhibitor

During the third quarter of 2015, Incyte announced a global license and collaboration agreement with Jiangsu Hengrui Medicine Co., Ltd. for the development and commercialization of SHR-1210 (now INCSHR1210), an investigational anti-PD-1 monoclonal antibody. INCSHR1210 has now entered a proof-of-concept trial for the treatment of patients with advanced solid tumors.

INCB53914 — PIM Inhibitor

The Company has initiated an open-label, dose-escalation study of INCB53914, a selective pan-PIM kinase inhibitor, in subjects with hematological malignancies.

On November 3, 2015 ARIAD Pharmaceuticals, Inc. (NASDAQ: ARIA) reported financial results for the third quarter of 2015, including revenue from sales of Iclusig (ponatinib) (Press release, Ariad, NOV 3, 2015, View Source;p=RssLanding&cat=news&id=2105752 [SID:1234507898]). The Company also provided an update on key corporate initiatives and clinical-trial plans.

Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:

Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing

                  Schedule Your 30 min Free Demo!

"We are on track to achieve our product revenue guidance of $130 to $140 million for 2015, with important contributions coming from European and U.S. sales and anticipated successful resolution of pricing negotiations for Iclusig in France," stated Harvey J. Berger, M.D., chairman and chief executive officer of ARIAD. "Each of the major clinical initiatives – outlined at the beginning of 2015 as part of our three-year strategic operating plan – is progressing as projected. These include full patient enrollment in the ALTA pivotal trial of brigatinib, ongoing enrollment of patients in the dose-ranging OPTIC trial of Iclusig and anticipated initiation before year-end of the second-line trial of Iclusig. We expect that results from these randomized trials, if positive, will form the basis for expanded utilization of Iclusig and initial approval of brigatinib. We are also moving ahead with another randomized trial – a comparison of brigatinib and crizotinib in front-line non-small cell lung cancer – which we anticipate beginning in the first half of next year."

2015 Third Quarter Financial Results

Revenues

Net product revenues from sales of Iclusig were $27.5 million for the third quarter, compared to $14.5 million in the third quarter of 2014 and $27.8 million in the second quarter of 2015.

U.S. sales of Iclusig were $20.3 million for the third quarter, compared to $21.6 million in the second quarter of 2015, the difference primarily due to flat quarter-over-quarter demand and an increase in gross-to-net adjustments.

European sales of Iclusig were $7.2 million for the third quarter, compared to $6.2 million in the second quarter of 2015, the difference primarily due to increased quarter-over-quarter demand.

Shipments of Iclusig to patients in France were $2.2 million for the third quarter of 2015. Cumulative total shipments in France totaled $23.3 million through September 30, 2015. We will record revenue related to cumulative shipments in France upon completion of pricing and reimbursement negotiations in France, net of any amounts that will be refunded to the French health authorities as a result of these negotiations, which we anticipate will be completed by year-end 2015.

Operating Expenses

Research and development (R&D) expenses were $48.2 million for the third quarter of 2015, an increase of 75% compared to the third quarter of 2014. This reflects an increase in costs for our ongoing Phase 2 ALTA trial of brigatinib, and NDA-enabling pharmacology and manufacturing activities, costs related to the initiation of the Iclusig Phase 2 dose-ranging OPTIC trial, as well as an increase in personnel and other costs in support of our continuing R&D activities.
Selling, general and administrative (SG&A) expenses were $36.7 million for the third quarter of 2015, an increase of 9% compared to the third quarter of 2014. This reflects an increase in personnel costs, including the impact of severance costs associated with the pending retirement of our chief executive officer and an increase in costs in support of expanding distribution and sales of Iclusig.

Net Loss

Net loss for the quarter ended September 30, 2015 was $55.5 million, or $0.29 per share, compared to a net loss of $50.1 million, or $0.27 per share, for the same period in 2014.
During the quarter ended September 30, 2015, we recorded in marketable securities on our balance sheet the value of shares of common stock we own in REGENXBIO, Inc., which completed an initial public offering during the quarter; these shares are not saleable until the first quarter of 2016. The value of the shares at September 30, 2015 was $15.1 million. The value net of tax, $9.1 million, is recorded in other comprehensive income. An intra-period tax benefit of $6.0 million related to the tax consequences of this item included in other comprehensive income is recorded as a tax benefit in our statement of operations.

Cash Position

As of September 30, 2015, cash and cash equivalents totaled $282.2 million, compared to $352.7 million at December 31, 2014.
During the quarter ended September 30, 2015, we entered into a royalty financing agreement with PDL BioPharma, Inc. (PDL) under which we received $50 million from PDL in exchange for payments to PDL based on a percentage of global sales of Iclusig over time until PDL receives a 10% internal rate of return. In July 2016, we will receive an additional $50 million from PDL. Under the agreement, we also have an option, in our sole discretion, to receive up to an additional $100 million through July 2016.
Recent Progress and Key Objectives

Commercialization of Iclusig

Approximately 125 new patients were treated with Iclusig in the U.S. during the third quarter of 2015. Importantly, approximately 55% of these new patients receiving Iclusig are patients with chronic-phase chronic myeloid leukemia (CP-CML).
Through the third quarter, there have been approximately 980 unique prescribers of Iclusig in the U.S., an increase in the cumulative prescriber base of approximately 13% from the second quarter of 2015.
In Europe, we are now promoting Iclusig in 12 countries: the United Kingdom, France, Germany, Italy, Austria, Switzerland, The Netherlands, Luxembourg, Denmark, Norway, Sweden, and Finland. In addition, Iclusig is available for purchase and is being supplied through named-patient programs and prior authorizations in Spain, Portugal, Ireland, Turkey and in several markets in Eastern Europe.

Iclusig is now reimbursed in Canada and Australia, and commercial launches continue in both countries through our regional distribution partners.

Iclusig Clinical Development

In August, we initiated patient enrollment in the OPTIC (Optimizing Ponatinib Treatment In CML) trial of Iclusig. This randomized, dose-ranging trial is designed to evaluate three different starting doses of ponatinib in patients with refractory CP-CML and is expected to inform the optimal use of Iclusig in these patients. Approximately 450 patients will be enrolled at clinical sites around the world.

Later this quarter, we expect to begin a Phase 3 trial of Iclusig in patients with CP-CML, who have experienced treatment failure after imatinib therapy. This second-line study of Iclusig is expected to enroll approximately 600 patients and is aimed at expanding the indication for Iclusig in patients with resistant and intolerant CML.

Brigatinib Clinical Development

In September, we achieved full patient enrollment in the pivotal Phase 2 ALTA trial of brigatinib. This registration study enrolled approximately 220 patients at 71 sites in North America, Europe and Asia. We are on track to file in the third quarter of 2016 for approval of brigatinib in the U.S.

The randomized front-line clinical trial of brigatinib is expected to begin in the first half of 2016. This Phase 3 trial will compare brigatinib and crizotinib in approximately 300 patients with ALK+ non-small cell lung cancer (NSCLC), who have not received prior ALK inhibitors.

Advancing the Pipeline

We are on track to file an investigational new drug (IND) application for AP32788 by year-end 2015 and to begin a Phase 1/2 proof-of-concept clinical trial in 2016. AP32788 is an orally active tyrosine-kinase inhibitor (TKI), which has a unique profile against a validated class of mutated targets in NSCLC and certain other solid tumors and may address an important unmet medical need.
Today’s Conference Call at 8:30 a.m. ET

We will hold a live webcast and conference call of our third quarter 2015 financial results this morning at 8:30 a.m. ET. The live webcast can be accessed by visiting the investor relations section of the Company’s website at View Source The call can be accessed by dialing 888-311-8173 (domestic) or 330-863-3376 (international) five minutes prior to the start time and providing the pass code 55634805. A replay of the call will be available on the ARIAD website approximately two hours after completion of the call and will be archived for three weeks.

About Iclusig (ponatinib) tablets

Iclusig is a kinase inhibitor. The primary target for Iclusig is BCR-ABL, an abnormal tyrosine kinase that is expressed in chronic myeloid leukemia (CML) and Philadelphia-chromosome positive acute lymphoblastic leukemia (Ph+ ALL). Iclusig was designed using ARIAD’s computational and structure-based drug-design platform specifically to inhibit the activity of BCR-ABL. Iclusig targets not only native BCR-ABL but also its isoforms that carry mutations that confer resistance to treatment, including the T315I mutation, which has been associated with resistance to other approved TKIs.

Iclusig is approved in the U.S., EU, Australia, Switzerland, Israel and Canada.

In the U.S., Iclusig is a kinase inhibitor indicated for the:

Treatment of adult patients with T315I-positive chronic myeloid leukemia (chronic phase, accelerated phase, or blast phase) or T315I-positive Philadelphia chromosome positive acute lymphoblastic leukemia (Ph+ ALL).
Treatment of adult patients with chronic phase, accelerated phase, or blast phase chronic myeloid leukemia or Ph+ ALL for whom no other tyrosine kinase inhibitor (TKI) therapy is indicated.
These indications are based upon response rate. There are no trials verifying an improvement in disease-related symptoms or increased survival with Iclusig.

IMPORTANT SAFETY INFORMATION, INCLUDING THE BOXED WARNING

WARNING: VASCULAR OCCLUSION, HEART FAILURE, and HEPATOTOXICITY

See full prescribing information for complete boxed warning

Vascular Occlusion: Arterial and venous thrombosis and occlusions have occurred in at least 27% of Iclusig treated patients, including fatal myocardial infarction, stroke, stenosis of large arterial vessels of the brain, severe peripheral vascular disease, and the need for urgent revascularization procedures. Patients with and without cardiovascular risk factors, including patients less than 50 years old, experienced these events. Monitor for evidence of thromboembolism and vascular occlusion. Interrupt or stop Iclusig immediately for vascular occlusion. A benefit risk consideration should guide a decision to restart Iclusig therapy.

Heart Failure, including fatalities, occurred in 8% of Iclusig-treated patients. Monitor cardiac function. Interrupt or stop Iclusig for new or worsening heart failure.

Hepatotoxicity, liver failure and death have occurred in Iclusig-treated patients. Monitor hepatic function. Interrupt Iclusig if hepatotoxicity is suspected.

Please see the full U.S. Prescribing Information for Iclusig, including the Boxed Warning, for additional important safety information.