On July 30, 2015 Seattle Genetics, Inc. (Nasdaq: SGEN)reported financial results for the second quarter and six months ended June 30, 2015 (Press release, Seattle Genetics, JUL 30, 2015, View Source;p=RssLanding&cat=news&id=2073186 [SID:1234506770]). The company also highlighted ADCETRIS (brentuximab vedotin) commercialization, regulatory and clinical development accomplishments, progress with other proprietary pipeline programs and antibody-drug conjugate (ADC) and other collaborator updates.

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"With record ADCETRIS net sales in the second quarter and a broad ongoing clinical development program comprising four phase 3 trials for a range of CD30-expressing malignancies, we are enthusiastic about the potential to expand ADCETRIS to help patients in need," said Clay Siegall, Ph.D., President and Chief Executive Officer of Seattle Genetics. "Looking ahead, we are increasing our 2015 ADCETRIS net sales guidance by $10 million to now be in the range of $210 million to $220 million. We anticipate a decision from the FDA on our AETHERA supplemental BLA by August 18th, and are on track to complete enrollment in our phase 3 ECHELON-1 and ALCANZA trials before the end of 2015. In addition, our clinical-stage pipeline is gaining increased visibility with data from multiple programs expected over the course of the next six to nine months, notably SGN-CD33A and SGN-CD19A."

Recent ADCETRIS Highlights

The U.S. Food and Drug Administration (FDA) filed the company’s supplemental BLA for use of ADCETRIS in the AETHERA setting for post-transplant consolidation treatment of Hodgkin lymphoma (HL) patients at high risk of relapse or progression. The FDA granted Priority Review and set a Prescription Drug User Fee Act (PDUFA) target action date of August 18, 2015.

Reported data on ADCETRIS in the AETHERA setting, in diffuse large B-cell lymphoma (DLBCL) and in several other HL and non-Hodgkin lymphoma settings at multiple sessions during the American Society of Clinical Oncology (ASCO) (Free ASCO Whitepaper) 50th Annual Meeting and the 13th International Conference on Malignant Lymphoma (ICML). The data demonstrated the breadth of the ADCETRIS clinical development program and its broad potential in a range of CD30-expressing malignancies.

Takeda Pharmaceutical Company Limited (Takeda) continues to receive additional marketing approvals for ADCETRIS, which is now commercially available in 56 countries worldwide.

Initiated a phase 2 clinical trial evaluating ADCETRIS in systemic lupus erythematosus (SLE, or lupus), a chronic autoimmune disease.

Recent Pipeline, Collaborator and Other Highlights

Entered into a strategic collaboration and license agreement with Unum Therapeutics to develop and commercialize novel antibody-coupled T-cell receptor (ACTR) therapies for cancer. Under the terms of the agreement, Seattle Genetics made an upfront payment of $25 million and an equity investment of $5 million in Unum. The companies will initially develop two ACTR products incorporating Seattle Genetics’ antibodies, and Seattle Genetics has an option to expand the collaboration to include a third ACTR product.

Received a milestone payment under a collaboration with AbbVie, triggered by its initiation of a phase 1 trial for an ADC for hematologic malignancies utilizing Seattle Genetics’ technology.

Named Sundos Hamza, M.D. as Senior Vice President, Pharmacovigilance and Risk Management. Dr. Hamza was previously Senior Vice President, Drug Safety Risk Management at InterMune and before that she was Executive Medical Director, Safety and Regulatory at Amgen.

Anticipated Upcoming Activities

Obtain FDA review decision for use of ADCETRIS in the AETHERA setting for post-transplant consolidation treatment of HL patients at high risk of relapse or progression.

Complete enrollment in ADCETRIS phase 3 trials ECHELON-1 and ALCANZA during 2015 and ECHELON-2 during 2016.
Initiate a randomized phase 2 trial of Rituxan (rituximab) and bendamustine with or without ADCETRIS for relapsed/refractory CD30-positive DLBCL.

Initiate phase 1 / 2 trials of ADCETRIS in combination with Opdivo (nivolumab) in HL and non-Hodgkin lymphoma.
Conduct an end of phase 1 meeting with the FDA and seek scientific advice in Europe to determine next steps towards a global registration strategy for SGN-CD33A.

Initiate a randomized phase 2 trial of SGN-CD19A in second-line DLBCL.

Report clinical data from ADCETRIS and pipeline programs, including SGN-CD33A, SGN-CD19A and SGN-LIV1A.

ADCETRIS is not currently approved for the post-transplant consolidation treatment of HL patients at high risk of relapse or progression, or for use in DLBCL, SLE or non-Hodgkin lymphoma other than systemic anaplastic large cell lymphoma.

Second Quarter and Six Months 2015 Financial Results

Total revenues in the second quarter and six month periods ended June 30, 2015 increased to $77.1 million and $159.3 million, respectively, from $68.3 million and $136.6 million for the same periods in 2014. ADCETRIS sales in the second quarter were $55.1 million, compared to $44.8 million for the second quarter of 2014. For the year-to-date, ADCETRIS sales were $104.0 million, compared to $83.5 for the year-to-date period in 2014, an increase of 25 percent. Second quarter 2015 revenues also included royalty revenues driven by international sales of ADCETRIS by Takeda of $7.6 million, compared to $7.3 million in the second quarter of 2014. For the year-to-date in 2015, royalty revenues were $18.7 million, compared to $20.0 million for the first six months of 2014. First quarter 2014 royalty revenues included a $5 million sales milestone payment from Takeda. In addition, revenues included amounts earned under the company’s ADCETRIS and ADC collaborations totaling $14.4 million in the second quarter and $36.6 million for the first six months of 2015, compared to $16.2 million and $33.1 million for the same periods in 2014.

Total costs and expenses for the second quarter of 2014 were $124.7 million, compared to $86.0 million for the second quarter of 2014. For the first six months of 2015, total costs and expenses were $228.6 million, compared to $170.6 million in the first six months of 2014. The increase in 2015 costs and expenses was primarily driven by the $25.0 million upfront payment to Unum and investment in Seattle Genetics’ pipeline programs.

Non-cash, share-based compensation cost for the first six months of 2015 was $17.6 million, compared to $18.7 million for the first six months of 2014.

Net loss for the second quarter of 2015 was $47.5 million, or $0.38 per share, compared to a net loss of $17.6 million, or $0.14 per share, for the second quarter of 2014. For the six months ended June 30, 2015, net loss was $69.2 million, or $0.55 per share, compared to a net loss of $33.9 million, or $0.28 per share, for the same period in 2014.

As of June 30, 2015, Seattle Genetics had $249.5 million in cash, cash equivalents and investments, compared to $313.4 million as of December 31, 2014.

2015 Financial Outlook

Seattle Genetics anticipates that 2015 revenues from ADCETRIS net product sales in the U.S. and Canada will be slightly higher than previously anticipated, and are now expected to be in the range of $210 million to $220 million. The company also now anticipates that 2015 research and development expenses will be in the range of $275 million to $300 million, primarily due to the $25 million upfront payment under the recent collaboration with Unum Therapeutics.