7-11-13 Qtly CC Transcript, PR (Financials/Devs Q4FY13/fye4-30-13), and the updated Avid Revenues History Table By Quarter (May’06-Current)…
**Note: ‘Going-Concern’ clause elim. from 4-30-13 10-K – see below.
This large post has 3 sections:
I. 7-11-13 Q4/FY’13 Qtly. Earnings Conf. Call TRANSCRIPT (q/e 4-30-13)
II. 7-11-13 PPHM Press Release: Q4/FY’13 Earnings & Developments
III. Updated Table of Avid Revenues By Quarter (May’06-Current)
…Recall: Peregrine’s FY runs May-Apr, so FY’13 = May’12-Apr’13.
((( Orig. transcript from SeekingAlpha.com [ http://tinyurl.com/o5qgod4 ], with numerous corrections made. )))
Link to webcast replay: http://ir.peregrineinc.com/eventdetail.cfm?eventid=131511
FULL TRANSCRIPT…
7-11-2013 Q4 FY’13 Earnings Conf. Call (fy/e 4-30-13)
WELCOME & FWD-LOOKING STATEMENTS: Jay Carlson (IR) http://www.peregrineinc.com
Speakers: Steve King, Joe Shan, Robert Garnick, Paul Lytle; Q&A session.
CEO Steve King – OPENING COMMENTS:
We've had a number of important events take place since our last quarterly call in March. These events started with important revelations further defining bavituximab's immunotherapy mechanism of action. They extended to compelling final data from our Phase II 2nd-Line NSCLC study that was the cornerstone for successful EOP2 discussions with the FDA that resulted in an approval of our Phase III clinical trial design. The better understanding of the moa has given us a completely new insight into recent clinical results, and even further strengthened our excitement about the Phase III trial design, combining bavituximab with docetaxel based on its immune adjuvant characteristics.
Joe will cover the Phase II clinical data in more detail, as well as our plans for advancing the program to Phase III later during the call. Rob will highlight the regulatory aspects of developments over the past few months, and Paul will give us an update on the great year at our contract manufacturing business, Avid Bioservices, and on efforts to strengthen the cash position as we look to advance the bavituximab program to Phase III while continuing partnering discussions.
Before turning the call over to my colleagues, I will briefly discuss the importance of the elegant data presented at AACR [4-2013 http://tinyurl.com/cnqx9oh ] that firmly established the immunotherapy mechanism of action of bavituximab. This data has given us a completely new viewpoint on the bavituximab program, and valuable insight as we review the clinical program and make plans for the next set of studies.
Data from a series of preclinical studies exploring the moa for phosphatidylserine or PS-targeting antibodies, such as bavituximab, were presented at the Annual AACR Meeting. Results of these studies demonstrated that PS-targeting antibodies mediate immune stimulatory changes in tumors by acting on an upstream immune checkpoint, resulting in the transformation of inhibitory immune cells, known as MDSCs, into tumor-fighting immune cells known as M1 macrophages, while simultaneously starting changes that lead to the formation of tumor-fighting cytotoxic T-cells. Based on these findings, we have reviewed the entire clinical program and are working with our clinical investigators to collect samples that may provide immune correlative data from 3 ongoing clinical trials in breast, rectal and liver cancers. This moa insight has also opened the door to completely new combinations not previously explored. Bavituximab acts on an upstream immune checkpoint, and thus, makes a potentially ideal combination with downstream-acting immune checkpoint inhibitors such as anti PD-1 antibodies and CTLA-4 targeted approaches, just to name two. Preclinical studies are well underway to explore these combinations, and we look forward to generating and reporting data later this year that could support moving these concepts into the clinic.
This has also allowed us to put clinical results to date into a clear perspective by allowing us to understand which combinations & dosing regimens are the most attractive, and perhaps more importantly, strengthening the rationale behind the planned Phase III trial combining bavituximab with docetaxel. These recent developments have also generated new partnering opportunities, as well as increasing interest on our ongoing partnership discussions for the bavituximab program, which will continue while we execute in advancing the program on multiple fronts. I will now turn the call over to Joe Shan for an update on the clinical programs.
JOE SHAN (VP/Clin.&Reg. Affairs) – CLINICAL TRIALS:
Certainly, the clinical highlights of the previous quarter were the encouraging results from the bavituximab Phase II trial in our lead indication of 2nd-Line NSCLC. These data led to an agreement with FDA on the pivotal Phase III trial design, which Rob will discuss later on the call. The final data from the randomized double-blind placebo-controlled Phase IIb trial presented at ASCO [6-3-13: http://tinyurl.com/my8qxw7 ] demonstrated a MOS of 11.7 mos. in the 3mg/kg bavituximab+docetaxel arm compared to 7.3 mos. in the combined control arm, with a persistent separation in the Kaplan-Meier survival curves. Subgroup analysis of overall survival by key patient characteristics, including age, gender, ECOG status, ethnicity and prior treatment, favored the bavituximab 3mg/kg containing arm, and there were no significant differences in adverse events between the trial arms. Importantly, the recent understanding of bavituximab immune action mechanisms Steve described earlier further reinforces the rationale of combination treatment with docetaxel, as not only does docetaxel upregulate PS, it has also been shown to exert immunostimulatory effects.
The pivotal Phase III trial design that we proposed and the FDA agreed to is a randomized double-blind placebo-controlled trial evaluating bavituximab+docetaxel vs. docetaxel+placebo in approx. 600 patients at clinical sites worldwide. They will enroll patients with advanced non-squamous, NSCLC who have progressed after std. front-line treatment. Patients will be randomized into 1 of 2 treatment arms. One treatment arm will receive up to 6 21-day cycles of docetaxel at 75mg/m2 in combination with 3mg/kg of bavituximab weekly until progression or toxicity. The other treatment arm will also receive up to 6 21-day cycles of docetaxel at the same dose, but in combination with placebo weekly until progression or toxicity. The primary endpoint of the trial will be overall survival. This Phase III trial design and the bavituximab immunotherapy mechanism were extremely well-received at our clinical advisory board meeting at ASCO, which comprised a group of leading oncologists who specialize in the treatment of lung cancer. The group was excited by bavi's unique upstream immune moa, and believes we have a very special drug with future potential synergies with downstream immunotherapies in clinical development. These experts also provided insightful feedback on the Phase III trial to help facilitate timely patient enrollment and differentiate it from potentially competing trials.
Based on these encouraging data, the reaching of agreement on the pivotal Phase III trial design, and discussions with our medical advisors, our primary focus in the near term is to initiate the bavituximab Phase III trial in 2nd-Line NSCLC by the end of this calendar year. Meanwhile, we continue to learn about bavi's effects on tumor immunity, both preclinically & clinically. The current investigator-sponsored trials (ISTs) in lung, breast, liver and rectal cancers include imaging, laboratory or tissue correlative studies, which should confirm future clinical development of bavituximab as a novel upstream immunotherapy. We look forward to providing an update on these efforts in the coming months. With that, I'll turn it over to Rob.
DR. ROBERT GARNICK (Head of Regulatory Affairs):
From a regulatory standpoint, I'm very pleased with the progress made during this quarter as we achieved 2 major goals in our most advanced program. First, the positive data that emerged from our 2nd-Line NSCLC trial provided additional safety, as well as clinically meaningful efficacy data needed to advance the program. Second, the reaching of an agreement with the FDA on our proposed clinical trial design was the result of a very successful and highly collaborative effort with the agency, which allowed us to proceed. Since our last quarterly conference call, we have had very positive interactions with FDA concerning our production processes and capability to manufacture Phase III material, and ultimately, bavituximab for the market, as a prelude to the EOP2 meeting, which was, by design, focused on our Phase III clinical plans. We believe this Phase III trial, along with the large amount of supporting data to date, could be sufficient to support a future biologics license application (BLA) submission. The next steps from a regulatory perspective are to initiate discussions with ex-U.S. regulatory agencies, such as the EMA, in order to facilitate the start of the global Phase III by year's end. With that, I'd like to turn it over to Paul.
CFO Paul Lytle:
I'd like to spend the next few moments covering a few financial highlights and our related financial goals. As I mentioned on the last call, it's important to note that we operate a hybrid business model that includes a revenue-generating contract manufacturing business and an advancing drug development business.
Let me first focus on our revenue-generating business, Avid Bioservices. There are 3 important topics to discuss with respect to Avid, including FY’13 revenue growth, future revenue potential, and Avid's strategic importance in preparing bavituximab for late stage clinical development and potential commercialization. Starting with revenue growth, during the recent quarter, Avid generated $4.2mm in contract mfg. revenue and $21.3mm during FY’13. This represents revenue growth of 44% over FY’12 and is in line with our increased revenue guidance we provided in March of this year. Second, Avid's revenue potential is closely tied to its current committed backlog for future services. We began FY’14 with over $27mm in manufacturing commitments that currently cover services to be provided in FY’14 and into FY'15. Based on this, we expect contract mfg. revenue for FY’14 to be between $18mm and $22mm, based on our current commitments. And third, it's important to emphasize Avid's continued contributions towards preparing our novel immunotherapy bavituximab for Phase III clinical development and for potential commercialization. There is a tremendous amount of ongoing effort in preparing a novel monoclonal antibody for commercial manufacturing.
Now, let me turn to our net loss. Strong revenue growth, combined with an expected decrease in R&D spending, has significantly reduced our net loss, decreasing 29% in FY’13 compared to FY'12. And this reduction in our net loss has translated into a 35% reduction in our cash burn rate during the recent FY to $24.8mm, representing our reported net loss less noncash expenses.
Let me now talk about our financing goals. As a backdrop, let me emphasize that we are closely managing our business, our cash position, and our various sources of capital as we prioritize and advance our later-stage clinical pipeline. Investing in our clinical program is the most important and significant potential value driver for Peregrine. Over the recent period, we have strengthened our cash position and reported over $42mm in cash & cash equivalents as of June 30, 2013. We now have the needed capital to fund our operations for at least the next 12 months based on our current financial projections, giving us the needed flexibility to initiate the upcoming Phase III trial in 2nd-Line NSCLC, while strengthening our position as we evaluate other potential opportunities. Looking ahead, we will continue to closely manage our operations in line with our cash position, while balancing our various sources of capital. We have invested in these programs using a balanced financial approach by closely matching our capital needs with our various sources of capital. We look forward to keeping you updated on our progress, and we will now open the call up for your questions.
Q&A: [16:30 mark]
1. Joe Pantginis – Roth Capital Partners: [ http://www.roth.com & https://roth2.bluematrix.com/docs/pdf/BLUE.pdf ]
JP: First, obviously, you've generated a lot of your new mechanistic data for the immunotherapy aspect of bavi. Maybe can you give a little forward-looking statements with regard to potential plans regarding combinations with some of the checkpoint inhibitors you mentioned? And then I have a follow-up.
SK: Obviously, with the information we now have on the mechanism of action, it really gives us a whole new insight into how we should be using the drug and what kind of combinations we should be looking at. And I think you've hit the nail on the head that one of the big focal points is, #1, a new indication such as melanoma, for instance, or renal cell cancer, which are known to be more immunotherapy sensitive. And then the 2nd is, of course, what should you combine with the drug? At ASCO this year, a lot of excitement about the combination potential of agents that act on the immune system, with a lot of the excitement being around the combination of PD-1 with ”ipi” [BMS’ Ipilimumab=YERVOYTM, an immune-boosting mab that binds to CTLA-4] - we're looking at that very heavily. We're well into preclinical programs that would help to answer the questions around how to best combine an early checkpoint inhibitor like bavituximab with some of the later checkpoint inhibitors, and it just makes perfect sense. So, one of our goals is to hopefully be able to complete and actually even potentially start a clinical trial combining our drug with other immunotherapies by the end of the year.
JP: Ok, great. And just staying on the immunotherapy scene, this is more of a macro commenting question that I'd like to tie into your lung cancer program. Obviously, whether it's cancer vaccines or other immunotherapy approaches such as yours or the PD-1 inhibitors or what have you, there are still a lot of questions that still need to be answered and questions that we're just starting to answer and just scratching the surface on. And one of those things have to do with chemotherapy combinations, sequencing, concurrent, all the different things that could potentially negatively impact the potential efficacy of this drug as we've been learning about different combinations. So with that said, regarding your first line lung program, any thoughts/hindsight about why this study might not have impacted survival and did it surprise you? And, the crux of the question is, when you look at the immunotherapy space, the general concept is now that the earlier stage patients should perform better with immunotherapy approaches. So I guess, the question would be, why didn't it here? And then, did the chemotherapies have any potential impact on that?
SK: Yes, and I think this is really at the crux of our complete review of the clinical program. So, just kind of taking a step back, when we started the bavituximab program in clinic, we were really focused on the effects that we were seeing in preclinical studies, primarily around the effects on vasculature. And we knew there was some immune component, but it was really thought to be more of a vascular acting agent. I think that has completely changed now. We recognize that while there are effects on the vasculature, those are downstream effects that are really mediated through inhibiting this early checkpoint. And it makes a world of difference the way we look at the drug because when we started the program, we were looking at chemotherapy as killing tumor, up-regulating the target, and so you’d get these kind of combinatorial effects. What we now recognize is we have to be a lot more careful when selecting indications, as well as chemotherapy combinations. One of the things that I think has us so excited about the docetaxel study is docetaxel is one of the stronger adjuvant type therapies that really enhance, if anything, the immune response. So, when we think about the other 2 results we had this year, the pancreatic cancer data, gemcitabine is a good chemotherapy combination potential with bavituximab, it's known to be immuno-stimulatory; however, just perhaps not in pancreatic cancer, where you have very fast progression and patients who are beginning to die from the disease within sort of 5-6 months. If you look at immunotherapies and the general theme at ASCO this year was that you really see the separation in survival curves starting at 4-5 months, so if you're already almost at your median, then you're really going to have difficulty showing an effect on survival in such a fast-acting disease. In the case of the front-line NSCLC data, while we didn't see much of an impact on overall survival, I think in retrospect, maybe that wasn't as surprising as it could've been because there have now been published reports showing that a combination of ipilimumab [BMS’ Ipilimumab=YERVOYTM] with carboplatin & paclitaxel, that staging was very important; in fact, they found that when they gave concurrent therapy with chemotherapy and the immune activating drug, that they basically had no effect. And when they staged it and gave chemotherapy first and then started with the immunotherapy treatment, then they saw actually quite good results. So in retrospect, if we had been thinking about this in immunotherapy, we might have designed those studies a little bit differently. But I think it opens up a lot of doors for us now in development, and being able to think about those combinations and what we want to move forward. But clearly right now, it's all about Phase III, which, if anything, I think has been strengthened by what we now know and looking at some of those immunotherapy combinations, and getting those in the clinic and seeing how that goes.
JP: That makes perfect sense. And I guess, your ipi example is obviously, very well taken, because again, we're really at the, just scratching the surface on being able to answer these types of questions. So now, with this kind of knowledge and answers that we have with regards to the staging of various therapies, is this something that either based on what you plan to do or also in the hands of a partner, you would now potentially pursue in a frontline setting for lung again?
SK: Yes, I definitely think that's one of the things we want to do, is really take a look at what studies we’ve run, what we've learned from those and potentially even go back, like you said, and just with now, all the knowledge at hand, design the study that's more likely to be successful.
JP: I have to ask the question, since you talked about it again during this call, it's very simplistic, how are your partnering discussions going?
SK: Well, I think that one of the great things here is that this has really opened a lot of doors for potential partnerships, for collaborations. There are just so many things that we can now do with the drug that we didn't really have in our hands before. The partner discussions are going well. It's the same strategy we've been laying out before, the goal will be primarily an ex-U.S. partnership* to bring in someone with commercialization expertise, but also be able to maintain as much U.S. rights as we can to advance the program. And to still have a big piece of the upside at the end of the clinical process.
*NOTE: corrected from “US” to “ex-US” – clearly, SK had a slip of the tongue here (confirmed by IR!). SK has made the exact same statements re: “ex-U.S. partnership goal, retaining as much U.S. rights as we can” at 3-18-13/Roth http://tinyurl.com/cebtwen , 3-12-13/CC http://tinyurl.com/c48osut , and 9-10-12/CC http://tinyurl.com/8nkwrml ]
2. George Zavoico (MLV): [ 2-8-10 coverage init: http://tinyurl.com/yech7gz ]
Congratulations on the progress you've made this quarter, and especially the Avid growth is pretty impressive, which is the first question. Based on your projections, it looks like for FY’14, that the Avid revenue is going to be pretty flat. I imagine that doesn't take into account, obviously, any new customers that you might bring on. So 2 questions. One, do you have room for new customers in terms of doing production runs? And has the record of Avid been excellent in terms of delivering the production runs on time? Is there any back up there?
Paul Lytle: Yes. As we mentioned in the script, we're guiding $18-20mm [for FY’14], and that is purely based on what has been committed as of the beginning of the FY. So, there is a lot of potential for addl. upside as we book addl. potential customers, as they request addl. business. But, this is truly just committed business that's currently on the schedule as of today, so I think there is some upside. If you look at our guidance last year, we increased it I believe a couple of times last year as we gained addl. business and delivered on that business. So, I think there is some potential upside, and we do have some addl. capacity to grow that number. In addition, I think it's important to note also that Avid did approx. $10 million in equivalent services for Peregrine last year, which does not get reflected into the financial statements, it's eliminated in consolidation. But they're also doing a tremendous amount of work, really preparing bavituximab for a Phase III trial, for potential commercialization, and those efforts will also be ongoing through this next FY.
SK: And George, I think to answer your question about the timing of release, as we've gotten busier & busier, improving operations has become more & more important. And so we've absolutely been focused on success rates of production runs, because as we get the reactors more & more full, there's less & less space to have mishaps in the reactor. The 2nd being that we've really been pushing very heavily on the timing, and as you've seen over the last couple of years, we're busier, but also we're releasing lots on time, we're getting those out to the customers. It's become a much more reliable sort of flow of production & release & shipment to the customers. So, I think we've been very successful on both those fronts, and the group at Avid has done a great job in responding to the increased business demands.
GZ: Your biggest Avid customer is responsible for what percentage of the revenue?
PL: If you look at in our 10-K [ 4-30-13 iss. 7-11-13: http://tinyurl.com/p58jcbw ], we actually break out segment reporting by customer. And it's included in the footnotes in the financials. But yes, one of our major customers [Halozyme] is a major player in our revenue & growth, and their successes are directly aligned with our successes.
GZ: Moving on to bavituximab. You mentioned you are going back to the patients that are in the ongoing trials, that you're going to be doing some addl. samplings. Does this require any amendments to the protocols? Is this strictly an investigational approach? What do you need to do to be able to take those samples?
Joe Shan: Some of the protocols are already included, some of these are mean correlates, obviously, as our understanding of the immune effects of bavituximab increases, there are addl. things we're looking at, so some of these will have to be amended into the ongoing trials to collect the samples appropriately, to be able to answer some of these other questions. So, it's a combination of both.
GZ: And then for the Phase III, I imagine you're not going to have to do amendments, it's going to be written into the initial protocol?
Joe Shan: Right. Yes, we're still finalizing what's practical to do in the Phase III setting vs. in a sub-study of some sort.
GZ: I'm trying to remember from some of the survival curves that you showed in the meetings, one of the elements that shows up often in Kaplan-Meier curves is a tailing plateau, suggesting that the immune system has kicked in and has kept the tumor in check. Did you see anything like that? I'm trying to remember, I can't remember offhand.
Joe Shan: Yes, both our 2nd-Line trials, as well as the pancreatic trial, did have a sort of a tail on the right in the treatment arm, and it is consistent in terms of the shape. Obviously, we have to run more studies to prove that, but they are separating around the time you expect, around 4-5 months. Going back to the pancreatic trial, this is a much more aggressive disease than 2nd-Line NSCLC, and so the overall survival there was shorter. So I think that's an indication maybe, it's too far. We talked about earlier that the earlier stage, in theory, the more the immune system can play a role. I think that's something we'll have to kind of evaluate on a case-by-case. Certainly with the 1-year survival rates, we can definitely see a difference.
GZ: Yes, it's really a clue. It doesn't prove anything, it's just nice to see that, I guess. My final question is about the imaging program. What are you thinking going forward in terms of being able to monetize that? Are you going to use that imaging agent as part of the upcoming Phase III or is it still going to be a separate track for development?
SK: We're continuing the Phase I program with the imaging product, learning as we go along. There’s certainly no intention to implement that into the Phase III - at this point, we have a pretty clean design and it's pretty clear what we need to do. Our goal is to be able to implement that into potentially some of the other clinical trials as well. With the immunotherapy focus now, it really has changed the way we look at a lot of different things, because we recognize that while it's great to upregulate PS, we also need to make sure we select agents that don't just upregulate PS, but also don't inhibit this immuno-stimulatory effect of bavituximab. I think as a standalone, it's still potentially got a great future in just monitoring the effectiveness of therapies, and if there's a way to implement it into our earlier stage development programs, learn more about it, we're certainly going to take advantage of that.
GZ: And is the imaging program on the partnering table as well right now? Or do you only want to gather more data?
SK: It's going to depend on the partner. Some are highly interested in it, others don't really have as much of a diagnostic imaging type focal point. So obviously, if we start to show some great correlation with clinical results, then it'll certainly be something which will tick up in interest levels.
3. Roy Buchanan (in for Charles Duncan) – Piper Jaffray [http://www.piperjaffray.com – 3-5-13 Initiates PPHM: http://tinyurl.com/bxhntk3 ]
It's Roy in for Charles. Can you remind me, the Phase III, is that sequential chemo in bavi or is it concurrent?
Joe Shan: This one's concurrent. There's no data to suggest that induction chemotherapy would make a difference in the combination with immunotherapy.
RB: Can you consider it kind of sequential considering it's 2nd-Line? And are you taking all comers? Is it EGFR-mutant patients, first line, erlotinib-treated?
Joe Shan: Yes, so we're not selecting for [indiscernible]
RB: Can you remind me, you mentioned the ipilimumab studies. What indications? Were they looking at sequential vs. concurrent?
SK: That was actually in front line NSCLC. With carboplatin & paclitaxel, there's been shown to be this kind of correlative with giving the sort of staged administration of the chemotherapy followed by the ipi - then you see the enhanced activity. Now, that may not be true with every combination. Docetaxel, again, is an adjuvant for slightly different reasons, from the literature, so the key there is it's really a much more effective or much more active adjuvant, and so the timing may not be as critical as it is with other combinations. What we've seen up to now has all been with sequential dosing, we've seen very positive results from the Phase IIb study [2nd-Line NSCLC], positive results from an earlier Phase II study, and so at this point, we have no reason to want to start to adjust the treatment regimen for that particular combination.
RB: I wonder if you guys could go into a little bit more detail on the EOP2 talks with the FDA. I know the conclusion was good; if there were any points of concern that the agency brought up, and if there were any key points that, I guess, won them over, convinced them that bavi is ready for Phase III?
Robert Garnick: No. There was no - really, it was quite benign. They liked the plan we proposed. They thought it was well thought through, and there were absolutely no sticky issues whatsoever.
MR. KING’S CLOSING COMMENTS:
I'd like to thank you all again for joining us on today's conference call. I hope from today's call, you get a clearer sense of why we're so excited about the prospects of bavituximab, given our increased understanding of its mechanism, but also how this is fueling additional opportunities for our pipeline. We believe the strategy we have outlined to simultaneously advance bavituximab into Phase III and leverage potential new applications will offer new treatment options for patients participating in our trials, bringing a higher profile of the company, and increase the prospects for our valued shareholders. Thank you, again, and we look forward to updating you on our progress over the coming months.
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7-11-13 PR: Peregrine Pharmaceuticals Reports Q4/FY2013 Financial Results and Recent Developments
• Positive Phase IIb Data in Second-Line NSCLC and FDA Agreement on Pivotal Phase III Trial Design Position Start of Phase III Trial by Calendar Year-End
• Bavituximab's Immunotherapeutic Mechanism of Action Data Presented at AACR Creates Expanded Drug Development Opportunities
• Avid's Contract Manufacturing Revenue Topped $21 Million for FY 2013 and Starts FY 2014 With Over $27 Million in Revenue Backlog From Contract Manufacturing Business
http://ir.peregrineinc.com/releasedetail.cfm?ReleaseID=776569
TUSTIN, 7/11/13: Peregrine Pharmaceuticals, Inc. (NASDAQ: PPHM), a biopharmaceutical company developing first-in-class monoclonal antibodies focused on the treatment and diagnosis of cancer, today announced financial results for the fourth quarter and fiscal year (FY) ended April 30, 2013 and provided an update on its advancing clinical pipeline and other corporate developments.
"The combination of preclinical data supporting bavituximab's immunotherapeutic mechanism of action presented at AACR, compelling second-line NSCLC data presented at ASCO and reaching the recent agreement with the FDA on a pivotal Phase III design have helped transform our bavituximab clinical program. We are now focused on initiating this Phase III trial in second-line NSCLC by the end of the year while simultaneously evaluating new areas of opportunity based on the enhanced understanding we now have of bavituximab's mechanism of action," said Steven W. King, President and CEO of Peregrine. "This increased knowledge further supports the combination with docetaxel that we are pursuing in Phase III while opening the door to multiple new potential combinations that were not previously explored. These developments have initiated new partnering opportunities as well as increased interest amongst current partnership discussions surrounding the bavituximab program which continue while we execute this supplemental development strategy."
Data from a series of preclinical studies exploring the mechanism of action for phosphatidylserine (PS)-targeting antibodies, such as bavituximab, were presented at the Annual Meeting of the American Association for Cancer Research (AACR) [4-2013 http://tinyurl.com/cnqx9oh ]. Results from these studies demonstrated that PS-targeting antibodies mediate immune-stimulatory changes in tumors by acting on upstream immune checkpoints and transforming those immune cells that are inhibiting immune recognition (MDSC's) into tumor-fighting (M1) macrophages and activated dendritic cells that lead to the formation of tumor fighting T-cells. Based on these findings, Peregrine is collecting immune correlative data from three of the its ongoing investigator-sponsored clinical trials in breast, rectal and liver cancers while also exploring the potential to combine bavituximab with other immunotherapies such as PD-1 antibodies and CTLA-4 targeted approaches.
BAVITUXIMAB ONCOLOGY PROGRAM HIGHLIGHTS
Lead Indication in Second-Line Non-Small Cell Lung Cancer:
• Reached agreement with the U.S. Food and Drug Administration (FDA) on a Phase III registration trial design of bavituximab in second-line non-small cell lung cancer (NSCLC).
• Recently announced final results from its 121 patient Phase IIb randomized, double-blind, placebo-controlled trial of bavituximab in second-line NSCLC at the 2013 American Society of Clinical Oncology (ASCO) Annual Meeting [6-3-13: http://tinyurl.com/my8qxw7 ].
? Promising 60% improvement in median overall survival (OS) in the 3mg/kg bavituximab plus docetaxel arm compared to the control arm and bavituximab was well-tolerated with no significant differences in adverse events between the trial arms.
? Subgroup analyses of OS by key patient characteristics including age, gender, ECOG status, ethnicity and prior treatment favored the bavituximab 3 mg/kg arm.
• Planning for the initiation of a pivotal Phase III trial by calendar year-end.
Other Oncology Indications:
The company is exploring the potential of bavituximab through a number of other company-sponsored and investigator-sponsored trials (IST) including:
• A Phase II randomized, open-label, clinical trial evaluating bavituximab plus gemcitabine in 70 patients with previously untreated, advanced Stage IV pancreatic cancer. Data presented at the 2013 ASCO Annual Meeting showed a more than a doubling of overall response rate (ORR) in the bavituximab-containing arm, a positive safety profile and a modest improvement in median OS. As enrollment included patients with poor prognosis including advanced metastatic disease with significant liver involvement and poor performance status associated with rapid disease progression, a subgroup analysis was conducted. Results from this subgroup analysis showed that the effect of bavituximab plus gemcitabine was more pronounced in patients with ECOG <= 1 and those without hepatic metastases. While the final data combined with the results from subgroup analyses warrant future consideration, given the fast progression of pancreatic cancer and the need for longer treatment periods associated with immunotherapies such as bavituximab, there are no plans to initiate a follow-on trial in pancreatic cancer at this time.
• A Phase II randomized, open-label clinical trial evaluating bavituximab plus carboplatin and paclitaxel versus carboplatin and paclitaxel (C/P) alone in up to 86 patients with previously untreated Stage IIIb or Stage IV NSCLC. Data recently announced, with less than 60% of survival events reached, that while the bavituximab-containing treatment arm demonstrated a median OS of over 14 months, there was not a meaningful enough difference in survival between the two arms of the trial to support another study using this combination and timing of therapy. An independent study with another immunotherapy agent showed that when C/P are given together with an immunotherapy, as was done in this bavituximab trial, the results were similar to the control arm however when C/P are administered in advance of the immunotherapy much more favorable results are achieved. We are currently evaluating options for moving bavituximab forward in front-line NSCLC. Full results from this trial will be presented at a future scientific meeting or through publication.
• A Phase I IST evaluating bavituximab in combination with paclitaxel in up to 14 patients with HER2-negative metastatic breast cancer. Interim data on 13 evaluable patients were presented at the 2013 ASCO Annual Meeting showed that 85% of patients achieved an objective tumor response, including 15% of patients achieving a complete response (CR) measured in accordance with RECIST criteria. All patients have been enrolled in this trial.
• A Phase I/II IST evaluating bavituximab in combination with sorafenib in up to 48 patients with advanced hepatocellular carcinoma (liver cancer). The Phase I portion of the trial has completed patient enrollment with enrollment in the Phase II portion of the trial ongoing.
• A Phase Ib IST evaluating bavituximab in combination with carboplatin and pemetrexed in up to 25 patients with previously untreated Stage IV NSCLC. This trial continues to enroll and dose patients.
• A Phase I IST evaluating bavituximab in combination with capecitabine and radiation therapy in up to 18 patients with Stage II or III rectal adenocarcinoma. This trial continues to enroll and dose patients.
IMAGING PROGRAM HIGHLIGHTS
PS-Targeting Molecular Imaging Program
Peregrine continues to enroll and dose patients in an open-label, single-center trial of its experimental PS-targeting molecular imaging candidate, 124I-PGN650, in patients with various solid tumor types. The primary goal of the trial is to estimate radiation dosimetry in critical and non-critical organs. Secondary objectives of the trial are tumor imaging and safety. Recently, data were presented from imaging studies demonstrating that the chemotherapeutic drug docetaxel, a commonly prescribed second-line treatment for patients with advanced NSCLC, increases the exposure of bavituximab's target molecule, PS, on tumor blood vessel cells and tumor cells. Results also showed that PS exposure in tumors is correlated with tumor burden and response to docetaxel treatment, supporting exposed PS as a promising biomarker of cancer and response to therapy. In the June 2013 issue of the journal Molecular Imaging, scientists from Peregrine published results from a study showing that PGN650 could be useful in imaging tumors and detect enhanced PS exposure in response to chemotherapy.
FINANCIAL RESULTS
"This quarter capped off a record year for our wholly-owned manufacturing subsidiary, Avid Bioservices, which generated over $21 million in non-dilutive contract manufacturing revenue and has started FY 2014 with more than $27 million in committed services from existing third-party clients," said Paul Lytle, Chief Financial Officer of Peregrine. "We have also strengthened our cash position that gives us the needed flexibility to initiate the upcoming Phase III trial in second-line NSCLC while we continue to evaluate our future opportunities."
Total revenues for the fourth quarter of FY 2013 were $4,254,000, compared to $2,065,000 for the same quarter of the prior fiscal year. For FY 2013, total revenues were $21,683,000, compared to $15,233,000 for the prior year. The FY 2013 increase was primarily attributed to an increase in contract manufacturing revenue generated from Avid Bioservices due to an increase in the number of completed manufacturing runs.
Contract manufacturing revenues from Avid's clinical and commercial biomanufacturing services provided to its third-party clients increased 44% to $21,333,000 for FY 2013, which were the highest reported amount in Avid's history and were within Peregrine's previous guidance range, compared to $14,783,000 for FY 2012. FY 2014 started with manufacturing commitments from Avid's third-party customers in excess of $27 million, covering services to be provided during FY 2014 and into FY 2015. Of this amount, Peregrine expects contract manufacturing revenues for FY 2014 to be between $18 million and $22 million. In addition to providing biomanufacturing services to its third-party clients, Avid will continue to utilize available capacity and resources to continue its preparation for later stage clinical development and potential commercialization of bavituximab and Cotara.
Total costs and expenses in the fourth quarter of FY 2013 were $12,717,000, compared to $12,955,000 in the fourth quarter of FY 2012. For FY 2013, total costs and expenses were $50,035,000 compared to $57,303,000 for FY 2012. This decrease primarily was attributable to lower research and development expenses due to the decrease in clinical trial expenses. For the fourth quarter FY 2013, research and development expenses were $5,835,000, compared to $8,930,000 for the fourth quarter of FY 2012, and for FY 2013 were $24,306,000, compared to $35,688,000 for FY 2012. Selling, general and administrative expenses for FY 2013 were $13,134,000 compared to $11,462,000 for FY 2012.
Peregrine's consolidated net loss was $8,449,000, or $0.06 per share, for the fourth quarter of FY 2013, compared to a net loss of $10,882,000 or $0.10 per share, for the same quarter of the prior year. For FY 2013, net loss was $29,780,000, or $0.25 per share, compared to $42,119,000, or $0.50 per share, for FY 2012.
Peregrine reported $35,204,000 in cash and cash equivalents as of April 30, 2013, compared to $18,033,000 at fiscal year ended April 30, 2012. As of June 30, 2013, the company had $42,563,000 in cash and cash equivalents.
[Note: Also, prior ‘GOING CONCERN’ clause eliminated from the 4-30-13 10-K]
More detailed financial information and analysis may be found in Peregrine's Annual Report on Form 10-K, which will be filed with the Securities and Exchange Commission today. [ 10-K: http://tinyurl.com/p58jcbw ]
Conference Call
Peregrine will host a conference call and webcast this afternoon, July 11, 2013, at 4:30 PM EDT (1:30 PM PDT). To listen to the conference call, please dial (877) 312-5443 or (253) 237-1126 and request the Peregrine Pharmaceuticals conference call. A replay of the call will be available starting approximately two hours after the conclusion of the call through July 18, 2013 by calling (855) 859-2056, or (404) 537-3406 and using passcode 10642041. To listen to the live webcast, or access the archived webcast, please visit: http://ir.peregrineinc.com/events.cfm .
About Peregrine Pharmaceuticals, Inc.
Peregrine Pharmaceuticals, Inc. is a biopharmaceutical company with a portfolio of innovative monoclonal antibodies in clinical trials focused on the treatment and diagnosis of cancer. The company is pursuing multiple clinical programs in cancer with its lead immunotherapy candidate bavituximab and novel brain cancer agent Cotara®. Peregrine also has in-house cGMP manufacturing capabilities through its wholly-owned subsidiary Avid Bioservices, Inc. ( http://www.avidbio.com ), which provides development and biomanufacturing services for both Peregrine and third-party customers. Additional information about Peregrine can be found at http://www.peregrineinc.com .
Safe Harbor *snip*
Contact: Christopher Keenan or Jay Carlson
Peregrine Pharmaceuticals, Inc. (800) 987-8256 info@peregrineinc.com
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Latest 10K 4-30-13 iss. 7-11-13: http://tinyurl.com/p58jcbw PR: http://tinyurl.com/khpokw6 (Cash 4-30-13=$35.2, 6-30-13=$42.6mm)
Latest 10Q 1-31-13 iss. 3-12-13: http://tinyurl.com/cu2qry5 PR: http://tinyurl.com/c48osut (Cash 1-31-13 $26.3mm)
ALL SEC filings for PPHM: http://tinyurl.com/6d4jw8
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= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =
Updated PPHM REVS-BY-QTR TABLE, now thru FY13/Q4 (fy/e 4-30-13), per the 4-30-13 10-K (http://tinyurl.com/p58jcbw ) issued 7-11-13. Deferred-Revs at 4-30-13, going fwd into FY’14/Q1 (q/e 7-31-13), total $4.17mm, down from the $5.06mm of Deferred-Revs at 1-31-13 that drove into FY’13/Q4.
• Total Revs since May’06: ($80.1mm/Avid + $24.1mm/Govt + $2.0mm/Lic.) = $106.3mm
==> Recall, Avid Rev$ from Gov’t DTRA Contract work (6/30/08 – 4/15/11, totaling $24.15mm), went into GOVT-REVS, not AVID-REVS, in the Financials.
Avid’s website: http://www.avidbio.com
AVID PROFITABILITY (GROSS*) BY QTR:
QTR Avid-Rev$ CostofMfg$ Gross-Profit$ GM%
FY13Q1 7-31-12 4,135,000 2,024,000 2,111,000 51%
FY13Q2 10-31-12 6,061,000 3,703,000 2,358,000 39%
FY13Q3 1-31-13 6,961,000 3,651,000 3,310,000 47%
FY13Q4 4-30-13 4,176,000 3,217,000 959,000 23%
FY13 TOTAL: 21,333,000 12,595,000 8,738,000 41%
*Avid Net-Profit (ie, incl. Selling, G&A) not split out from PPHM-Corp. in the financials.
.
PPHM REVENUES (in thousands) DEFERRED
-------REVENUES------- REVENUES INVEN-
Quarter Avid Govt Lic. TOTAL Avid Govt TORIES
FY07Q1 7-31-06 398 0 23 421 317 0 971
FY07Q2 10-31-06 636 0 48 684 1388 0 1899
FY07Q3 1-31-07 347 0 16 363 2202 0 1325
FY07Q4 4-30-07 2111 0 129 2240 1060 0 1916
FY08Q1 7-31-07 1621 0 4 1625 1820 0 2363
FY08Q2 10-31-07 1863 0 29 1892 1338 0 3500
FY08Q3 1-31-08 1662 0 13 1675 1434 0 2394
FY08Q4 4-30-08 751 0 150 901 2196 0 2900
FY09Q1 7-31-08 1193 324 0 1517 4021 980 4628
FY09Q2 10-31-08 983 958 0 1941 6472 1701 6700
FY09Q3 1-31-09 5778 1048 0 6826 4805 3262 5547
FY09Q4 4-30-09 5009 2683 175 7867 3776 3871 4707
FY10Q1 7-31-09 2070 4671 9 6750 5755 2332 6177
FY10Q2 10-31-09 5308 1510 78 6896 4260 3989 5850
FY10Q3 1-31-10 2945 6854 78 9877 3052 76 3861
FY10Q4 4-30-10 2881 1461 78 4420 2406 78 3123
FY11Q1 7-31-10 983 2111 115 3209 3719 47 4692
FY11Q2 10-31-10 3627 966 78 4671 2447 35 3555
FY11Q3 1-31-11 1922 882 79 2883 4300 40 3915
FY11Q4 4-30-11 1970 681 78 2729 5617 0 5284
FY12Q1 7-31-11 5439 0 216 5655 4145 0 4481
FY12Q2 10-31-11 4154 0 78 4232 2012 0 3178
FY12Q3 1-31-12 3203 0 78 3281 2552 0 2722
FY12Q4 4-30-12 1987 0 78 2065 3651 0 3611
FY13Q1 7-31-12 4135 0 116 4251 6056 0 5744
FY13Q2 10-31-12 6061 0 78 6139 6221 0 5426
FY13Q3 1-31-13 6961 0 78 7039 5061 0 4635
FY13Q4 4-30-13 4176 0 78 4254 4171 0 4339
Totals: 80174 24149 1980 106303 <=since5/1/2006
.
TOTAL REV’s BY YEAR (Avid+Gov’t+Lic):
FY04 4-30-04 3,314 …Avid(CMO)= 3,039 (Avid-Revs don’t incl. Govt-SVCS)
FY05 4-30-05 4,959 …Avid(CMO)= 4,684
FY06 4-30-06 3,193 …Avid(CMO)= 3,005
FY07 4-30-07 3,708 …Avid(CMO)= 3,492
FY08 4-30-08 6,093 …Avid(CMO)= 5,897
FY09 4-30-09 18,151 …Avid(CMO)= 12,963
FY10 4-30-10 27,943 …Avid(CMO)= 13,204
FY11 4-30-11 13,492 …Avid(CMO)= 8,502
FY12 4-30-12 15,233 …Avid(CMO)= 14,783
FY13 4-30-13 21,683 …Avid(CMO)= 21,333
...Total Gov’t Revs from 7-2008 inception thru FY11Q4(Apr’11): $24.15mm
.
AVID “Total Services”:
AVID OUTPUT$ 3rd-PARTY + PEREGRINE = TOTAL-OUTPUT$
FY09 4-30-09 13mm 10mm $23mm #
FY10 4-30-10 13mm 17mm $30mm #
FY11 4-30-11 9mm 11mm $20mm @
FY12 4-30-12 15mm 11mm $26mm @
FY13 4-30-13 21mm ~10mm ~$31mm ^
LTM ended 1/2010 3rd/$15.3mm + Govt/$8.3mm + PPHM/$8.8mm = $32.4mm *
@SKing 3-18-2013 RothOC/DanaPT (Slide21) http://tinyurl.com/cebtwen
#SKing 7-12-2012 JMP/NYC Conf. (Slide27) http://tinyurl.com/csdclwb
*SKing 3-17-2010 RothOC/DanaPT Conf. (Slide18) http://tinyurl.com/ye9v7jq
^PLytle 7-11-2013 Qtly-CC “Avid did ~$10mm in equivalent services for Peregrine in FY13,
which doesn’t get reflected into the fin. statements, it's eliminated in consolidation.”
.
PPHM’S QTLY. NET LOSS BY QTR:
FY08Q1 7-31-07 4,656,000
FY08Q2 10-31-07 6,207,000
FY08Q3 1-31-08 6,154,000
FY08Q4 4-30-08 6,159,000
FY09Q1 7-31-08 5,086,000
FY09Q2 10-31-08 4,497,000
FY09Q3 1-31-09 3,332,000
FY09Q4 4-30-09 3,609,000
FY10Q1 7-31-09 2,428,000
FY10Q2 10-31-09 2,787,000
FY10Q3 1-31-10 1,538,000
FY10Q4 4-30-10 7,741,000
FY11Q1 7-31-10 7,695,000
FY11Q2 10-31-10 7,513,000
FY11Q3 1-31-11 8,929,000
FY11Q4 4-30-11 10,014,000
FY12Q1 7-31-11 8,092,000
FY12Q2 10-31-11 12,055,000
FY12Q3 1-31-12 11,090,000
FY12Q4 4-30-12 10,882,000
FY13Q1 7-31-12 7,664,000
FY13Q2 10-31-12 8,753,000
FY13Q3 1-31-13 4,914,000
FY13Q4 4-30-13 8,449,000
.
= = = = = = =
OPER. CASH BURNS* BY QTR(FROM THE 10-Q/K’S):
FY10Q1 7-31-09 2,024,000 (from 10Q pg.25)
FY10Q2 10-31-09 2,351,000 (Q1+Q2: 4,375,000 pg.28)
FY10Q3 1-31-10 1,158,000 (Q1+Q2+Q3: 5,533,000 pg.30)
FY10Q4 4-30-10 6,375,000 (FY’10: 11,908,000 10K pg.58)
FY11Q1 7-31-10 6,567,000 (from 10Q pg.24)
FY11Q2 10-31-10 6,167,000 (Q1+Q2: $12,734,000 pg.25)
FY11Q3 1-31-11 7,736,000 (Q1+Q2+Q3: $20,470,000 pg.26)
FY11Q4 4-30-11 8,961,000 (FY’11: 29,431,000 10K pg.54)
FY12Q1 7-31-11 6,984,000 (from 10Q pg.25)
FY12Q2 10-31-11 11,668,000 (Q1+Q2: 18,652,000 pg.25)
FY12Q3 1-31-12 8,490,000 (Q1+Q2+Q3: 27,142,000 pg.25)
FY12Q4 4-30-12 11,265,000 (FY’12: 38,407,000 10K pg.55)
FY13Q1 7-31-12 6,742,000 (from 10Q pg.21)
FY13Q2 10-31-12 6,162,000 (Q1+Q2: 12,904,000 pg.23)
FY13Q3 1-31-13 3,597,000 (Q1+Q2+Q3: 16,501,000 pg.23)
FY13Q4 4-30-13 7,053,000 (FY’13: 23,554,000 10K pg.60)
FY’09 total Op-Burn: $14,715,000
FY’10 total Op-Burn: $11,908,000
FY’11 total Op-Burn: $29,431,000
FY’12 total Op-Burn: $38,407,000
FY’13 total Op-Burn: $23,554,000
*The 10-Q’s define OPER.BURN as, ”Net cash used in operating activities before chgs. in operating assets & liabilities”.
The 7-21-2001 10Q explains OP.BURN very nicely:
“RESULTS OF OPERATIONS. Before we discuss the Company's total expenses (cash & non-cash expenses), we would like to discuss the Company's operational burn rate (cash expenses used in operations, net of interest and other income) for q/e July 31, 2001 compared to the same period in the prior year. The operational burn rate is calculated by taking the net income (loss) from operations and subtracting all non-cash items, such as the recognition of deferred license revenue, depreciation and amortization and stock-based compensation expense.”
.
- - - - - - - - PPHM’s Fiscal Qtr’s (FY runs May – April):
FY’10-Q3 = q/e 1-31-10 – rep. 3-11-10 Thu (B4 mkt)
FY’10-Q4 = q/e 4-30-10 – rep. 7-14-10 Wed (after mkt)
FY’11-Q1 = q/e 7-31-10 – rep. 9-9-10 Thu (after mkt)
FY’11-Q2 = q/e 10-31-10 – rep. 12-9-10 Thu (after mkt)
FY’11-Q3 = q/e 1-31-10 – rep. 3-11-11 Fri (after mkt)
FY’11-Q4 = q/e 4-30-11 – rep. 7-14-11 Thu (after mkt)
FY’12-Q1 = q/e 7-31-11 – rep. 9-9-11 Fri (B4 mkt)
FY’12-Q2 = q/e 10-31-11 – rep. 12-12-11 Mon (after mkt)
FY’12-Q3 = q/e 1-31-12 – rep. 3-9-12 Fri (after mkt)
FY’12-Q4 = q/e 4-30-12 – rep. 7-16-12 Mon (after mkt)
FY’13-Q1 = q/e 7-31-12 – rep. 9-10-12 Mon (B4 mkt)
FY’13-Q2 = q/e 10-31-12 – rep. 12-10-12 Mon (after mkt)
FY’13-Q3 = q/e 1-31-13 – rep. 3-12-13 Tue (after mkt)
FY’13-Q4 = q/e 4-30-13 – rep. 7-11-13 Thu (after mkt)
= = = = = = = = = = = =
“Going Concern” statement ELIMINATED from 4-30-13 10-K issued 7-11-2013…
2012: 4-30-12 10-K iss. 7-16-12 http://tinyurl.com/79o57b2
Pg.68: “As more fully described in Note 2, the Company’s recurring losses from operations and recurring negative cash flows from operating activities raise substantial doubt about its ability to continue as a going concern.”
2013: 4-30-13 10-K iss. 7-11-13 http://tinyurl.com/p58jcbw
==> ((((NO GOING CONCERN STATEMENT INCLUDED.))))
CASH a/o 4-30-13: $35.2mm
CASH a/o 6-30-13: $42.6mm
(from 7-11-13 PR: http://ir.peregrineinc.com/releasedetail.cfm?ReleaseID=776569 )
= = = = = = = = = = Also, a quick look at #Employees per 10K…
2011: 4-30-11 10-K: "As of 4-30-11, we employed 154 full-time emps & 2 part-time emps”
2012: 4-30-12 10-K: "As of 4-30-12, we employed 172 full-time emps & 2 part-time emps."
2013: 4-30-13 10-K: "As of 4-30-13, we employed 182 full-time emps & 5 part-time emps."
= = = = = = = = = = = = = = = = = = http://www.peregrineinc.com
Bavituximab MOA Diagrams added to PeregrineInc.com 7-13-13 (“Technology”):
http://www.peregrineinc.com/technology/bavituximab-oncology/mechanism-of-action.html
Peregrine’s Corp. Fact Sheet updated 7-12-13:
http://www.peregrineinc.com/images/stories/pdfs/corp_fact_sheet.pdf
Info. about upcoming Ph.III 2nd-line NSCLC trial…
This Bavituxumab MOA Diagram added to 7-12-13 Fact Sheet…
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