On November 9, 2015 Merrimack Pharmaceuticals, Inc. (Nasdaq: MACK), a biopharmaceutical company that applies systems biology to develop cancer treatments and diagnostics, reported its third quarter 2015 financial results (Press release, Merrimack, NOV 9, 2015, View Source [SID:1234508166]). Merrimack will host a live conference call and webcast today, Monday, November 9 at 4:30 p.m., Eastern time, to provide an update on Merrimack’s progress as well as a summary of these results.

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Investors and the general public are invited to listen to the call by dialing (877) 564-1301 (domestic) or (224) 357-2394 (international) five minutes prior to the start of the call and providing the passcode 69525411. A listen-only webcast of the call can be accessed in the Investors section of Merrimack’s website, investors.merrimack.com, and a replay of the call will be archived there for six weeks following the call.

Key Recent Events

Approval of ONIVYDE (irinotecan liposome injection) by the U.S. Food and Drug Administration on October 22, 2015;
Commercial launch of ONIVYDE in the United States on October 26, 2015;

Enrollment of first patient in a Phase 2 clinical study of ONIVYDE in previously untreated front-line metastatic pancreatic cancer; and

Achievement of $66.5 million in net milestone payments from collaborations in 2015, consistent with Merrimack’s previous financial guidance.

Upcoming Milestones

Merrimack anticipates the following clinical milestones:

Initiation of a Phase 3 clinical study of ONIVYDE in front-line HER2-negative gastric cancer in 2016;

Results from the Phase 2 clinical study of MM-121 in patients with heregulin-positive, locally advanced or metastatic non-small cell lung cancer in the second half of 2016;

Results from the Phase 2 clinical study of ONIVYDE in previously untreated front-line metastatic pancreatic cancer in the first half of 2017;

Results from HERMIONE, the Phase 2 clinical study of MM-302 in patients with HER2-positive metastatic breast cancer designed to support a potential Accelerated Approval application to the FDA, in 2017; and

Results from the Phase 2 clinical study of MM-141 in patients with front-line metastatic pancreatic cancer who have high serum levels of free IGF-1 in 2017.

Third Quarter 2015 Financial Results

Revenue for the third quarter of 2015 was $16.4 million compared with revenue of $28.0 million for the third quarter of 2014, a decrease of $11.6 million or 41%. This decrease was primarily due to the termination of Merrimack’s collaboration with Sanofi effective December 17, 2014 and was offset by increased revenue recognized related to Merrimack’s collaboration with Baxalta during the third quarter of 2015.

Research and development expenses for the third quarter of 2015 decreased $5.9 million over the corresponding quarter of the preceding year. This decrease was primarily due to $12.0 million of non-recurring ONIVYDE collaboration milestones that were expensed in the third quarter of 2014. This decrease was offset by increased spending on Merrimack’s remaining pipeline.

General and administrative expenses for the third quarter of 2015 increased $8.9 million over the corresponding quarter of the preceding year. This increase was primarily attributable to increased infrastructure and personnel expenses as Merrimack prepared for the commercialization of ONIVYDE.

Merrimack’s net loss for the third quarter of 2015 was $42.4 million, or basic and diluted net loss per share available to common stockholders of $0.38, as compared to a net loss for the third quarter of 2014 of $28.0 million, or basic and diluted net loss per share available to common stockholders of $0.27.

Financial Outlook

Merrimack expects to be able to fund operations into the second quarter of 2016 based on the following:

– unrestricted cash and cash equivalents and available-for-sale securities of $62.4 million as of September 30, 2015;
– $47.5 million of milestones from Baxalta anticipated in the fourth quarter of 2015 related to the first patient dosed in the Phase 2 clinical study of ONIVYDE in previously untreated front-line metastatic pancreatic cancer; and
– anticipated cost sharing reimbursements from Baxalta.

Additional funding for operations would also come from:

– anticipated receipt of $46.5 million of net milestones related to ONIVYDE in 2016 from Baxalta, after offsetting payments to PharmaEngine;

– sales of ONIVYDE; and

– up to $15.0 million in additional debt that is currently available at Merrimack’s option under its loan agreement with Hercules Technology Growth Capital.

Upcoming Investor Conferences

Merrimack will attend the following investor conferences this fall:

Credit Suisse 24th Annual Healthcare Conference on November 11 in Scottsdale, AZ;
Jefferies Autumn 2015 Global Healthcare Conference on November 18 in London;
Oppenheimer 26th Annual Healthcare Conference on December 8 in New York; and
Guggenheim 3rd Annual Boston Healthcare Conference on December 15 in Boston.
Live webcasts of the presentations at the Credit Suisse 24th Annual Healthcare Conference, Jefferies Autumn 2015 Global Healthcare Conference and Oppenheimer 26th Annual Healthcare Conference can be accessed by visiting the Investors section of Merrimack’s website at investors.merrimack.com. A replay of the webcasts will be archived there for two weeks following each presentation.

On November 9, 2015 Intrexon Corporation (NYSE: XON), a leader in synthetic biology, reported its third quarter results for 2015 (Filing, 8-K, Intrexon, NOV 9, 2015, View Source [SID:1234508161]).

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Business Highlights and Recent Developments:

• During the third quarter, Intrexon and the biopharmaceutical business of Merck KGaA, Darmstadt, Germany, furthered research and development efforts with the collaboration’s first two chimeric antigen receptor (CAR) T-cell targets of interest and are advancing these targets to address unmet clinical needs for patients with hematological and solid tumor malignancies. In addition to CAR development, Intrexon is leveraging its engineering capabilities to develop an allogeneic cellular approach to address novel paradigms for "off the shelf" adoptive cell therapies;

• Acquired Oxitec Ltd., a company that has pioneered a targeted and innovative approach to control mosquitoes that spread disease and insect pests that damage crops, avoiding the off-target effects and broad environmental consequences of applying conventional insecticides. Addition of the Oxitec team expands Intrexon’s capabilities to address a broad range of global environmental, health and agricultural challenges in new and responsible ways;

• Completed work on an engineered cell line for Amneal Pharmaceuticals LLC to enable production of a complex active pharmaceutical ingredient (API) and the companies continue to explore other opportunities for future collaboration;

• Announced exclusive agreement between Intrexon Energy Partners (IEP) and Dominion Energy, a subsidiary of Dominion Resources (NYSE: D), to explore the potential for commercial-scale biological conversion of natural gas to isobutanol, a drop-in fuel with numerous advantages over other clean burning gasoline blendstocks. Dominion will be the exclusive partner to construct, own, operate, and maintain the production facilities in the Marcellus and Utica Shale Basins located in eastern North America via potential long-term services agreements with IEP;

• Established first Exclusive Channel Collaboration (ECC) with a startup backed by an investment fund that is dedicated to the inventions of Intrexon and sponsored by Harvest Capital Strategies, LLC. The collaboration with the startup entity, Thrive Agrobiotics, Inc., plans to utilize Intrexon’s ActoBiotics platform to express nutritive proteins for improving the overall growth and feed efficiency in piglets, thereby expanding the application of this innovative biologic delivery platform to animals;

• Expanded relationship with ZIOPHARM Oncology, Inc. (NASDAQ: ZIOP) through an ECC for the treatment and prevention of graft-versus-host disease (GvHD), a major complication of allogeneic hematopoietic stem-cell transplantation that significantly impairs the quality of life and survival of many recipients. The collaboration will focus on addressing the underlying pathologies of GvHD through engineered cell platforms to express and deliver interleukin-2 (IL-2), a cytokine critical for modulation of the immune system;
• Entered into an ECC with Synthetic Biologics, Inc. (NYSE MKT: SYN) to pursue the development and commercialization of novel biotherapeutics for the treatment of patients with phenylketonuria (PKU), a serious and debilitating metabolic disorder. The collaboration aims to target delivery of an essential enzyme via Intrexon’s ActoBiotics platform without having an adverse impact on the gut microbiome;

• With collaborator Fibrocell Science, Inc. (NASDAQ: FCSC) provided an update on the status of the Investigational New Drug (IND) application for FCX-007, Fibrocell’s orphan gene-therapy drug candidate for the treatment of the skin disorder recessive dystrophic epidermolysis bullosa (RDEB). At the request of the U.S. Food and Drug Administration (FDA), Fibrocell will conduct an additional toxicology-specific study and expects to amend the IND in response to the FDA’s feedback, including data from the new toxicology study, in the first quarter of 2016;

• Through wholly owned ViaGen Pets, announced successful feline cloning for customers and plans to launch broadly available companion animal service and product offering in 2016;

• Announced key management additions of Corey Huck as SVP, Head of Food Sector, and Joseph L. Vaillancourt, SVP, Head of Environment Sector; and

• Completed a public offering of common stock resulting in total gross proceeds of approximately $230 million, before deducting the underwriting discounts, commissions, and estimated expenses.
Third Quarter Financial Highlights:

• Total revenues of $53.4 million, an increase of 152% over the third quarter of 2014;

• Net loss of $38.2 million attributable to Intrexon, or $(0.34) per basic share;

• Adjusted EBITDA of $3.8 million, or $0.03 per basic share;

• Cash consideration received for reimbursement of research and development services covered 59% of cash operating expenses (exclusive of operating expenses of consolidated subsidiaries); and

• Cash, cash equivalents, and short-term and long-term investments totaled $352.6 million, and the value of equity securities totaled $76.6 million at September 30, 2015.
Year-to-Date Financial Highlights:

• Total revenues of $132.1 million, an increase of 224% over the nine months ended September 30, 2014;

• Net loss of $51.8 million attributable to Intrexon, or $(0.47) per basic share;

• Adjusted EBITDA of $43.6 million, or $0.40 per basic share;

• Distributed as a dividend to our shareholders equity securities having a market value of $172.4 million at the time of distribution;

• Total consideration received for technology access fees and reimbursement of research and development services covered 164% of cash operating expenses (exclusive of operating expenses of consolidated subsidiaries); and

• Total consideration received for technology access fees, reimbursement of research and development services and products and services revenues covered 135% of consolidated cash operating expenses.

"We continue to execute our plan and are satisfied with our progress to date," commented Randal J. Kirk, Chairman and Chief Executive Officer of Intrexon. "Now with approximately 700 team members working on many dozens of engineered biology projects across a vast array of organisms; programs that are world-leading in science and in industry; governmentally approved products that are being readied for market, products that are ready for approval and others that span every step of the developmental schedule; a recurrent and growing revenue base; a financial discipline that provides us with the capital efficiency to make long bets as well as surer bets; and a team that is fervent in its belief that we can improve the world while building one of its finest organizations, we believe we are seeing the engineering of biology emerging as the greatest industrial vector in history and clarifying Intrexon’s opportunity for a significant role in the world. We look forward to our upcoming Investor Day event and to the opportunity to showcase more of what we have achieved to date."

Third Quarter 2015 Financial Results Compared to Prior Year Period

Total revenues were $53.4 million for the quarter ended September 30, 2015 compared to $21.2 million for the quarter ended September 30, 2014, an increase of $32.2 million, or 152%. For the quarter ended September 30, 2015, Trans Ova product revenue includes $8.3 million from the sale of pregnant cows, live calves and livestock used in production and service revenue includes $7.3 million from the provision of in vitro fertilization and embryo transfer services. For the quarter ended September 30, 2014, these amounts were $3.8 million and $3.1 million, respectively. The increases relate primarily to the inclusion of a full quarter of results for Trans Ova in 2015 versus approximately one half-quarter of results for 2014 since the acquisition occurred during the middle of the third quarter of 2014. Collaboration and licensing revenues increased $22.1 million over the third quarter of 2014 due to (i) the recognition of deferred revenue for upfront payments received from Intrexon’s license and collaboration agreement with the biopharmaceutical business of Merck KGaA, which became effective in May 2015, and from other collaborations signed by Intrexon between October 1, 2014 and September 30, 2015, (ii) increased research and development services both for new collaborations and for the expansion of, or addition of new, programs with previously existing collaborators, and (iii) the recognition of previously deferred revenue related to collaboration agreements for which Intrexon satisfied all of its obligations or which were terminated by agreement during the quarter ended September 30, 2015.

Total operating expenses were $61.3 million for the quarter ended September 30, 2015 compared to $36.2 million for the quarter ended September 30, 2014, an increase of $25.1 million, or 69%. Research and development expenses were $21.6 million for the quarter ended September 30, 2015 compared to $14.9 million for the quarter ended September 30, 2014, an increase of $6.7 million, or 45%. Salaries, benefits and other personnel costs increased $3.1 million due to (i) increases in research and development headcount to support new and expanded collaborations and from Intrexon’s 2015 acquisitions and (ii) additional compensation expenses related to performance and retention incentives for research and development employees. Lab supplies and consultants increased $1.5 million as a result of the increased level of research and development services provided to Intrexon’s collaborators. Depreciation and amortization increased $1.3 million primarily as a result of acquiring property and equipment and intangible assets in connection with Intrexon’s acquisitions of ActoGeniX and Okanagan in 2015. Selling, general and administrative expenses were $23.0 million for the quarter ended September 30, 2015 compared to $14.9 million for the quarter ended September 30, 2014, an increase of $8.2 million, or 55%. Salaries, benefits and other personnel costs increased $4.1 million due to (i) the inclusion of selling, general and administrative employees of Trans Ova for the full quarter in 2015 compared to approximately one half-quarter in 2014 and (ii) additional compensation expenses related to performance and retention incentives for selling, general and administrative employees. Legal and professional expenses increased $1.4 million primarily due to costs associated with the Oxitec acquisition in 2015. Total operating expenses for the quarter ended September 30, 2015 also include $16.5 million of products and services costs which primarily consist of employee compensation costs, livestock, feed, drug supplies and facility charges related to the production of such products and services; this amount was $6.4 million for the quarter ended September 30, 2014. The increase relates primarily to the inclusion of a full quarter of results for Trans Ova in 2015 versus approximately one half-quarter of results for 2014 since the acquisition occurred during the middle of the third quarter of 2014.

Total other expense, net, was $29.6 million for the quarter ended September 30, 2015 compared to $37.2 million for the quarter ended September 30, 2014, a decrease of $7.6 million, or 20%. This decrease was primarily related to the changes in the value of Intrexon’s securities portfolio.

Year-to-Date 2015 Financial Results Compared to Prior Year Period

Total revenues were $132.1 million for the nine months ended September 30, 2015 compared to $40.8 million for the nine months ended September 30, 2014, an increase of $91.3 million, or 223%. For the nine months ended September 30, 2015, Trans Ova product revenue includes $28.4 million from the sale of pregnant cows, live calves and livestock used in production and service revenue includes $27.2 million from the provision of in vitro fertilization and embryo transfer services. For the nine months ended September 30, 2014, these amounts were $3.8 million and $3.1 million, respectively. The increases relate primarily to the inclusion of nine months of results for Trans Ova in 2015 versus approximately one half-quarter of results for 2014 since the acquisition occurred during the middle of the third quarter of 2014. Collaboration and licensing revenues increased $34.4 million due over the nine months ended September 30, 2014 due to (i) the recognition of deferred revenue for upfront payments received from Intrexon’s license and collaboration agreement with the biopharmaceutical business of Merck KGaA, which became effective in May 2015, and from other collaborations signed by Intrexon between January 1, 2014 and September 30, 2015, (ii) increased research and development services both for new collaborations and for the expansion or addition of new programs with previously existing collaborators, and (iii) the recognition of previously deferred revenue related to collaboration agreements for which Intrexon satisfied all of its obligations or which were terminated during the nine months ended September 30, 2015.

Total operating expenses were $244.6 million for the nine months ended September 30, 2015 compared to $91.8 million for the nine months ended September 30, 2014, an increase of $152.8 million, or 166%. Research and development expenses were $121.3 million for the nine months ended September 30, 2015 compared to $41.3 million for the nine months ended September 30, 2014, an increase of $80.0 million, or 193%. In January 2015, Intrexon issued 2,100,085 shares of its common stock valued at $59.6 million to the University of Texas MD Anderson Cancer Center, or MD Anderson, in exchange for an exclusive license to certain technologies owned by MD Anderson. Salaries, benefits and other personnel costs increased $9.0 million due to (i) increases in research and development headcount to support new and expanded collaborations and from Intrexon’s 2015 acquisitions and (ii) additional compensation expenses related to performance and retention incentives for research and development employees. Lab supplies and consultants expenses increased $5.6 million as a result of the increased level of research and development services provided to Intrexon’s collaborators. Depreciation and amortization expense increased $2.2 million primarily as a result of acquiring property and equipment and intangible assets in connection with Intrexon’s acquisitions of ActoGeniX and Okanagan in 2015.
Selling, general and administrative expenses were $74.3 million for the nine months ended September 30, 2015 compared to $43.9 million for the nine months ended September 30, 2014, an increase of $30.4 million, or 69%. Salaries, benefits and other personnel costs increased $17.5 million due to (i) the inclusion of selling, general and administrative employees of Trans Ova for a full nine months in 2015 compared to approximately one and one half months in 2014 and (ii) additional compensation expenses related to performance and retention incentives for general and administrative employees. Legal and professional expenses increased $4.1 million primarily due to costs associated with acquisitions, the license agreement with MD Anderson, and other business development activity. Depreciation and amortization associated with Trans Ova increased $2.0 million primarily due to the inclusion of such amounts for nine months in 2015 compared to one and one half months in 2014. Total operating expenses for the nine months ended September 30, 2015 also include $48.6 million of products and services costs which primarily consist of employee compensation costs, livestock, feed, drug supplies and facility charges related to the production of such products and services; this amount was $6.4 million for the nine months ended September 30, 2014. The increase relates primarily the inclusion of a full nine months of results for Trans Ova in 2015 versus approximately one half-quarter of results for 2014 since the acquisition occurred during the middle of the third quarter of 2014.

Total other income, net, was $65.1 million for the nine months ended September 30, 2015 compared to total other expense, net, of $49.0 million for the nine months ended September 30, 2014, an increase of $114.1 million, or 233%. This increase was primarily related to the changes in the value of Intrexon’s securities portfolio, including a realized gain of $81.4 million, which resulted from the special stock dividend of all of Intrexon shares of ZIOPHARM to the Company’s shareholders in June 2015.

On November 9, 2015 Halozyme Therapeutics, Inc. (NASDAQ: HALO), a biotechnology company developing novel oncology and drug-delivery therapies, reported financial results for the third quarter ended September 30, 2015 (Press release, Halozyme, NOV 9, 2015, View Source [SID:1234508158]). Revenue for the quarter of $20.8 million and a net loss of $24.5 million, or $0.19 per share, compared to revenue of $14.6 million and a net loss of $20.3 million, or $0.16 per share, for the third quarter of 2014. Financial results for the quarter were in line with company expectations and its annual financial guidance, which the company reiterated today.

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"With more than 100 patients now enrolled in Stage 2 of our Phase 2 study in pancreatic cancer patients, we are on track to close enrollment by the end of the year and achieve a major milestone toward our goal of ultimately commercializing PEGPH20," said Dr. Helen Torley, president and CEO. "Strong progress was made towards our goal of evaluating the pan tumor potential of PEGH20 by dosing the first patient in our immuno-oncology clinical trial in combination with Merck’s KEYTRUDA and by executing well on our broader clinical trial roadmap, including planning for initiation of our Phase 3 study in pancreatic cancer at the end of the first quarter of 2016.

"At the same time, our ENHANZE technology platform continued to deliver a growing royalty revenue stream from collaboration and licensing agreements with Roche and Baxalta, and we achieved important milestones toward potential future royalties with Pfizer, Janssen and AbbVie. Further progress was demonstrated by Pfizer and Janssen who initiated dosing in separate Phase 1 clinical trials with ENHANZE, while AbbVie announced plans to work with Halozyme on HUMIRA (adalimumab) with the goal to help reduce the number of induction injections and deliver additional performance benefits."

Third Quarter 2015 Highlights and Subsequent Events include:

Enrolling more than 100 patients to date in Stage 2 of Halozyme Study 202 of investigational new drug PEGPH20 in metastatic pancreatic ductal adenocarcinoma patients. Halozyme plans to complete its target enrollment of 114 patients by the end of 2015 and present results of the study in the second half of 2016.

Submitting Study 301 protocol to the FDA and European Regulatory Authorities. This Phase 3 study of PEGPH20 in previously untreated metastatic pancreatic cancer patients is planned for initiation by the end of first quarter 2016. Halozyme also made progress during the quarter with its partner Ventana toward completing a companion diagnostic test that will be used to prospectively screen patients for high levels of hyaluronan (HA). HA is a glycosaminoglycan, or chain of natural sugars in the body that accumulate around certain tumors. PEGPH20 is designed to temporarily degrade HA, improving the access of co-administered therapies.

Dosing the first patient in Halozyme’s Phase 1b study of PEGPH20 plus KEYTRUDA (pembrolizumab). The company is studying patients with relapsed/refractory Stage IIIB/IV non-small cell lung cancer and recurrent locally advanced or metastatic gastric adenocarcinoma. This trial is Halozyme-sponsored and is being conducted at a number of leading oncology centers with KEYTRUDA experience.

Progressing into a second dosing cohort in the Halozyme Phase 1b/2 PRIMAL study of PEGPH20 plus docetaxel in non-small cell lung cancer patients. Actions initiated during the quarter have resulted in an increase in the number of patients screened for the study. Once a maximum tolerated dose is determined, the company plans to expand the study with additional sites outside the U.S. and screen patients prospectively for trial eligibility based on high levels of HA.

Advancing Halozyme’s clinical collaboration with Eisai toward initiation of its Phase 1b/2 study in the first quarter of 2016. Halozyme and Eisai will co-fund the clinical trial to explore whether HALAVEN (eribulin) in combination with PEGPH20 can improve overall response rate, as compared with HALAVEN alone as a therapy for advanced HER2-negative high-HA metastatic breast cancer patients.

Achieving partner clinical milestones with the Halozyme ENHANZE technology platform, including Pfizer’s first dosing of healthy subjects with rivipansel and ENHANZE in a Phase 1 clinical trial; Janssen’s first dosing of the anti-CD38 daratumumab with ENHANZE in a Phase 1b clinical trial in multiple myeloma patients; and AbbVie announcing plans for HUMIRA a (adalimumab) under a collaboration and licensing agreement formed with Halozyme in June of 2015, with a goal to help reduce the number of induction injections at higher doses and deliver additional performance benefits.

Third Quarter 2015 Financial Highlights

Revenue for the third quarter was $20.8 million, compared to $14.6 million for the third quarter of 2014, driven primarily by an increase in royalties from partner sales of Herceptin SC, MabThera SC and HyQvia. Revenue for the quarter included $8.3 million in royalties, $6.3 million in sales of bulk rHuPH20 for use in manufacturing collaboration products, $3.9 million in HYLENEX recombinant (hyaluronidase human injection) product sales, and $2.2 million in collaboration revenue.

Research and development expenses for the third quarter were $27.6 million, compared to $19.9 million for the third quarter of 2014. The planned increase was primarily due to expenses for preclinical and clinical support of PEGPH20.

Selling, general and administrative expenses for the third quarter were $10.2 million, compared to $8.6 million for the third quarter of 2014. The increase was primarily due to an increase in personnel expenses, including stock compensation, for the period.
Net loss for the third quarter was $24.5 million, or $0.19 per share, compared to a net loss in the third quarter of 2014 of $20.3 million, or $0.16 per share.

Cash, cash equivalents and marketable securities were $123.7 million at Sept. 30, compared to $140.7 million at June 30, 2015.

Financial Outlook

For the full year 2015, the company maintains its previously announced guidance of:

Net revenues to be in the range of $110 million to $115 million;
Operating expenses to be in the range of $160 million to $170 million; and
Net cash burn to be between $20 million to $30 million.

On November 9, 2015 Galena Biopharma, Inc. (NASDAQ: GALE), a biopharmaceutical company committed to the development and commercialization of targeted oncology therapeutics that address major unmet medical needs, reported its financial results for the quarter ended September 30, 2015 (Filing, 8-K, Galena Biopharma, NOV 9, 2015, View Source [SID:1234508156]). The Company also announced it has completed a strategic review of the organization and has elected to focus its efforts and financial resources exclusively on the continued development of its high value oncology pipeline led by NeuVax (nelipepimut-S), and divest its commercial business which consists of Abstral (fentanyl) Sublingual Tablets and Zuplenz (ondansetron) Oral Soluble Film.

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For financial and accounting purposes, Galena has classified its commercial business activities as discontinued operations effective as of the third quarter, and the Company removes all revenue and expense guidance as it relates to its commercial business. Galena has engaged a financial advisor to provide strategic advice and a process to divest the commercial business, and the Company anticipates exiting the commercial business by the end of the first quarter of next year. Providers and patients will have ongoing access to both drugs until we have transitioned out of the business.

"Led by NeuVax, Galena has an extremely robust clinical development pipeline targeting areas of high unmet medical need that represent significant high-value market opportunities for the company," said Mark W. Schwartz, Ph.D., President & CEO. "Over the past year, we have met several key development milestones while also expanding our clinical pipeline to four assets in eight ongoing or planned clinical trials. Our strategy going forward is to advance these programs while exploring additional indications in the immuno-oncology field where our assets can potentially make a difference in the treatment of cancer or in addressing the rapidly growing patient population of cancer survivors by harnessing the power of the immune system to prevent their cancer recurrence."

Dr. Schwartz continued, "When I assumed the position of President and CEO of Galena, I, along with our executive team, began a careful examination of our operations and assets to determine the optimal strategy for Galena that would enable the greatest opportunity for growth, while maximizing shareholder value. As a result of this analysis and review by our Board of Directors, we have concluded that it is in the best interest of our patients, our shareholders, and the long-term success of our company to focus our energy and resources exclusively on our clinical development programs. Since acquiring the products we have significantly grown the sales of Abstral and successfully launched Zuplenz, and I believe that each has strong commercial potential and offers significant benefits to their respective patient populations. However, the foundation of Galena has always been our cancer immunotherapy programs, which are now rapidly advancing towards several key inflection points. Therefore, we believe it is important for Galena to focus on our core expertise and the successful advancement of our late and mid stage clinical pipeline. We appreciate the dedication and hard work of the commercial team as we transition out of the commercial business and are extremely grateful for all of their efforts."

Dr. Schwartz concluded, "For both patients and shareholders of Galena, there is a much greater opportunity to generate value if we dedicate all of our resources to our clinical programs, and we are eager to move the company in this new direction. As part of this renewed focus, we have officially consolidated at our new headquarters in San Ramon, California. We look forward to discussing these advances in more detail during our third quarter earnings webcast this afternoon."

Galena will host a webcast and conference call today at 2:00 p.m. P.T./5:00 p.m. E.T. to discuss financial and business results. The live webcast will include slides that can be accessed on the Company’s website under the Investors section/Events and Presentations: View Source The conference call can be accessed by dialing (844) 825-4413 toll-free in the U.S., or (973) 638-3403 for participants outside the U.S. The Conference ID number is: 54883466. The archived webcast replay will be available on the Company’s website for 90 days.

FINANCIAL HIGHLIGHTS AND GUIDANCE

As a result of our strategic decision to divest our commercial business, our commercial activities are classified as discontinued operations in our third quarter financial statements.

Operating loss from continuing operations for the third quarter of 2015 was $8.6 million, including $0.6 million in stock based compensation, compared to an operating loss from continuing operations of $10.6 million, including $1.1 million in stock-based compensation for the same period in 2014. Operating loss from continuing operations through the third quarter of 2015 was $26.6 million, including $1.3 million in stock based compensation, compared to an operating loss from continuing operations of $34.2 million, including $3.9 million in stock-based compensation for the same period in 2014. The decrease in net operating loss year-over-year is primarily the result of the completion of enrollment in our Phase 3 PRESENT trial for NeuVax, as well as the decrease in stock based compensation, and a reduction in legal expenses associated with ongoing litigation and legal proceedings.

Non-operating income or expenses include non-cash charges related to changes in the fair value estimates of the company’s warrant liabilities, contingent purchase price liability, and interest expense. The non-cash income related to the changes in the value of our warrant liability for the third quarter of 2015 was $2.1 million versus $6.7 million for the same period in 2014, respectively. The non-cash expense related to the changes in the value of our warrant liability through the third quarter of 2015 was $1.0 million versus a non-cash income of $13.2 million for the same period in 2014, respectively.

Loss from continuing operations for the third quarter of 2015 was $6.4 million, including $2.1 million in non-cash income described above, or $0.04 per basic and diluted share. Loss from continuing operations for the third quarter of 2014 was $3.5 million, including a $6.7 million in non-cash income described above, or $0.03 per basic and diluted share. Loss from continuing operations through the third quarter of 2015 was $28.2 million, including $1.0 million in non-cash expense described above, or $0.18 per basic and diluted share. Loss from continuing operations through the third quarter of 2014 was $22.0 million, including $13.2 million in non-cash income described above, or $0.19 per basic and diluted share.

Loss from discontinued operations for the third quarter of 2015 was $11.7 million, or $0.07 per basic and diluted share, compared to $2.6 million, or $0.02 per basic and diluted share, for the same period of 2014. Loss from discontinued operations through the third quarter of 2015 was $16.1 million, or $0.11 per basic and diluted share, compared to $6.6 million, or $0.06 per basic and diluted share, for the same period of 2014. Loss from discontinued operations include a $8.1 million non-cash impairment charge from classification of assets held for sale for the three and nine months ended September 30, 2015.

As of September 30, 2015, Galena had cash and cash equivalents of $34.8 million, compared with $23.7 million as of December 31, 2014. The $11.1 million increase in cash through the third quarter of 2015 represents $47.4 raised from issuance of common stock, partially offset by $27.8 million used in continuing operating activities, $5.0 million used in discontinued operating activities, $0.5 million milestone payment for Zuplenz, and $3.0 million in debt service payments.

THIRD QUARTER AND RECENT HIGHLIGHTS

Presented GALE-302 Preliminary Immunological Data Optimizing GALE-301 at the Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) 30th Anniversary Annual Meeting. The poster, entitled, "Preliminary report of a clinical trial supporting the sequential use of an attenuated E39 peptide (E39’) to optimize the immunologic response to the FBP (E39+GM-CSF) vaccine," compared three primary vaccine series (PVS) sequences of GALE-301 (E39) and GALE-302 (E39’) in ovarian and breast cancer patients to optimize the ex vivo immune responses, local reactions (LR), and delayed type hypersensitivity (DTH) reactions. The data demonstrated that the in vivo immune response is enhanced with the use of the attenuated E39’ (GALE-302) after E39 (GALE-301). The optimal vaccination sequence utilizing three inoculations of GALE-301 followed by three inoculations of GALE-302 produced the most prominent and statistically significant LR and DTH responses.

Announced the collaboration with the National Cancer Institute (NCI) to initiate a new, Phase 2 Clinical Trial With NeuVax in Ductal Carcinoma in Situ (DCIS) Patients. The trial will be entitled, VADIS: Phase 2 trial of the Nelipepimut-S Peptide VAccine in Women with DCIS of the Breast, and The University of Texas M.D. Anderson Cancer Center (MDACC) Phase I and II Chemoprevention Consortium is the lead for this multi-center trial. The Consortium is funded through the Division of Cancer Prevention at NCI, which will provide financial and administrative support for the trial. Galena will provide NeuVax, as well as additional financial and administrative support. The trial is expected to initiate in the fourth quarter of 2015.

Presented Positive GALE-301 Phase 2a Clinical Trial Data at the European Cancer Congress 2015. Poster #P427 (abstract #2764), entitled "Preliminary results of the phase I/IIa dose finding trial of a folate binding protein vaccine GALE-301 (E39) + GM-CSF in ovarian and endometrial cancer patients to prevent recurrence," provided updated data for all patients who had received at least twelve months of treatment. As presented, the clinical recurrence rate based on all treatment cohorts was 41% in the Vaccine Group (VG) (n=29) versus 55% in the Control Group (CG) (n=22), p=0.41. However, in the 1000 mcg VG cohort (n=15), there have only been two clinical recurrences (13.3% versus 55% CG, p=0.02), and the two-year Disease Free Survival (DFS) estimate is 85.7% versus 33.6% in the CG, p < 0.02, as compared by Kaplan-Meir and Log rank tests. Demographic, safety, immunologic, and clinical recurrence data are continuing to be collected.

The Independent Data Safety Monitoring Committee (IDMC) Recommended Reduction of Cardiac Toxicity Monitoring for the NeuVax PRESENT (Prevention of Recurrence in Early-Stage, Node-Positive Breast Cancer with Low to Intermediate HER2 Expression with NeuVax Treatment) Clinical Trial. Following its most recent IDMC meeting in June 2015, the IDMC recommended routine cardiac monitoring could be reduced in the PRESENT trial and that such a reduction is justified and consistent with the pre-specified Cardiac Toxicity Monitoring Stopping Rules defined in the study protocol. The IDMC concluded that cardiac toxicity monitoring by echocardiogram (ECHO) or multiple-gated acquisition (MUGA) scans could be reduced. The IDMC had no other suggestions and recommended the trial continue as planned.

CORPORATE HIGHLIGHTS

Appointed Bijan Nejadnik, M.D., as Executive Vice President and Chief Medical Officer. Dr. Nejadnik will be responsible for managing all of Galena’s clinical development programs and joins Galena from Jazz Pharmaceuticals where he was the Executive Director, Hematology-Oncology and led the clinical team towards a recently filed new drug application. Prior to Jazz, Dr. Nejadnik was at Johnson & Johnson and spent more than 13 years in teaching, research and caring for patients at world-renowned academic institutions. Dr. Nejadnik graduated from the University of Louvain in Belgium for both his undergraduate degree in premedical studies and his medical degree, and completed his internship and residency programs specializing in internal medicine focused on hematology-oncology at the University of Louvain and Oregon Health Sciences University. He completed his fellowships at Cornell University’s Weill Medical College and Johns Hopkins University School of Medicine. Dr. Nejadnik has led or participated in more than 20 peer-reviewed publications.

On November 9, 2015 DelMar Pharmaceuticals, Inc. (OTCQX: DMPI) ("DelMar" and the "Company"), a biopharmaceutical company focused on the development and commercialization of new cancer therapies, reported that its abstract entitled, "Phase I/II study of Dianhydrogalactitol (VAL-083) In Patients With Recurrent Malignant Glioma," was accepted for poster presentation at the 20th Annual Scientific Meeting and Education Day of the Society for Neuro-Oncology being held November 19 – 22, 2015, in San Antonio, Texas (Press release, DelMar Pharmaceuticals, NOV 9, 2015, View Source [SID:1234508154]).

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The poster presentation will include an update on the Company’s fully enrolled 14-patient expansion cohort from its Phase II clinical study of VAL-083 (dianhydrogalactitol) in refractory glioblastoma multiforme (GBM). Patients enrolled in the GBM trial have failed both front-line therapy with temozolomide and second-line Avastin and, in most cases, one or more salvage therapies.

DelMar recently completed enrollment in the Phase II study and confirmed 40mg/m2 as the maximum tolerated dose (MTD) for advancement into registration-directed Phase II/III clinical trials in GBM.

The Company previously presented data from the Phase I dose-escalation portion of its multicenter Phase I/II clinical study with VAL-083 in patients with recurrent GBM in which dose limiting toxicity was observed at 50mg/m2/day, no drug-related severe adverse events were reported, and myelosuppression was mild at doses <40mg/m2/day.

Additionally, data on a sub-group analysis for patients receiving up to 5 mg/m2 daily x 3 every 21 days (low dose) versus those patients receiving 30mg/m2 or 40mg/m2 (therapeutic dose) of VAL-083 from the clinical trial were also previously presented. The sub-group analysis supports a dose-dependent and clinically meaningful survival benefit in GBM patients whose tumors had progressed following standard treatment with temozolomide, radiotherapy, bevacizumab and a range of salvage therapies.

DelMar’s abstract has been published online in the 2015 abstract supplement to the Society for Neuro-Oncology’s official journal, Neuro-Oncology, at View Source

About VAL-083

VAL-083 is a "first-in-class," small-molecule chemotherapeutic. In more than 40 Phase I and II clinical studies sponsored by the U.S. National Cancer Institute, VAL-083 demonstrated clinical activity against a range of cancers including lung, brain, cervical, ovarian tumors and leukemia both as a single-agent and in combination with other treatments. VAL-083 is approved in China for the treatment of chronic myelogenous leukemia (CML) and lung cancer, and has received orphan drug designation in Europe and the U.S. for the treatment of malignant gliomas.

DelMar has demonstrated that VAL-083’s anti-tumor activity is unaffected by the expression of MGMT, a DNA repair enzyme that is implicated in chemotherapy resistance and poor outcomes in GBM patients following standard front-line treatment with Temodar (temozolomide).

DelMar recently announced the completion of enrollment in a Phase II clinical trial of VAL-083 in refractory GBM. Patients have been enrolled at five clinical centers in the United States: Mayo Clinic (Rochester, MN); UCSF (San Francisco, CA) and three centers associated with the Sarah Cannon Cancer Research Institute (Nashville, TN, Sarasota, FL and Denver, CO).

In the Phase I dose-escalation portion of the study, VAL-083 was well tolerated at doses up to 40mg/m2 using a regimen of daily x 3 every 21 days. Adverse events were typically mild to moderate; no treatment-related serious adverse events reported at doses up to 40 mg/m2. Dose limiting toxicity (DLT) defined by thrombocytopenia (low platelet counts) was observed in two of six (33%) of patients at 50 mg/m2. Generally, DLT-related symptoms resolved rapidly and spontaneously without concomitant treatment, although one patient who presented with hemorrhoids received a platelet transfusion as a precautionary measure.

Sub-group analysis of data from the Phase I dose-escalation portion of the study suggested a dose-dependent and clinically meaningful survival benefit following treatment with VAL-083 in GBM patients whose tumors had progressed following standard treatment with temozolomide, radiotherapy, bevacizumab and a range of salvage therapies.

Patients in a low dose (≤5mg/m2) sub-group had a median survival of approximately five (5) months versus median survival of approximately nine (9) months for patients in the therapeutic dose (30mg/m2 & 40mg/m2) sub-group following initiation of VAL-083 treatment. DelMar reported increased survival at 6, 9 and 12 months following initiation of treatment with VAL-083 in the therapeutic dose sub-group compared to the low dose sub-group.