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Clovis Oncology Announces First Quarter 2019 Operating Results

BusinessWire

BOULDER, Colo.–(BUSINESS WIRE)–lt;a href="https://twitter.com/search?q=%24CLVS&src=ctag" target="_blank"gt;$CLVSlt;/agt;–Clovis
Oncology, Inc. (NASDAQ:CLVS) reported financial results for the
quarter ended March 31, 2019, and provided an update on the Company’s clinical
development programs and regulatory and commercial outlook for the
rest of the year.

“We are pleased with our progress during the first quarter,” said
Patrick J. Mahaffy, President and CEO of Clovis Oncology. “With solid
sales performance, an encouraging update of our TRITON prostate cancer
data in support of our planned supplemental NDA in late 2019, the
expected near-term initiation of two lucitanib combination studies and a
successful financing that extends our projected cash runway into 2022,
we are very enthusiastic about our progress toward our 2019 goals. In
addition, I am pleased to announce that Dan Muehl, our Executive Vice
President Finance, has been promoted to Chief Financial Officer. Dan has
been with the Company for about four years and this is an extremely
well-deserved promotion. “

First Quarter 2019 Financial Results

Clovis reported product revenue for Rubraca of $33.1 million for the
first quarter of 2019, which included U.S. product revenue of $31.9
million and ex-U.S. product revenue of $1.2 million, as compared to net
product revenue for the quarter ended March 31, 2018 of $18.5 million.
During the first quarter, the supply of free drug distributed to
eligible patients through the Rubraca patient assistance program in the
U.S. was approximately 21 percent of overall commercial supply compared
to 22 percent in the first quarter of 2018. This represented $8.4
million in commercial value for the first quarter of 2019 compared to
$5.1 million in the first quarter of 2018. Rubraca was initially
approved in the ovarian cancer treatment setting in the U.S. in December
2016 and in the EU in May 2018. The Rubraca label was expanded to
include the broader and earlier-line maintenance treatment indication in
the U.S. in April 2018 and in the EU in January 2019.

Clovis had $406.8 million in cash, cash equivalents and
available-for-sale securities as of March 31, 2019. Cash used in
operating activities was $98.5 million for the first quarter of 2019,
compared with $100.6 million for the first quarter of 2018. This
includes product supply costs of $27.5 million in the first quarter of
2019, compared to $31.5 million for the comparable period in 2018. Cash
used also includes a $15 million milestone payment in the first quarter
of 2019 related to the EU maintenance indication approval. There were no
such milestone payments in the first quarter of 2018. Clovis had
approximately 53.0 million shares of common stock outstanding as of
March 31, 2019.

Clovis reported a net loss for the first quarter of 2019 of $86.4
million, or ($1.63) per share, compared to the net loss for the first
quarter of 2018 which was $77.7 million, or ($1.54) per share. Net loss
for the first quarter of 2019 included share-based compensation expense
of $13.6 million, compared to $11.9 million for the first quarter of
2018.

Research and development expenses totaled $62.0 million for the first
quarter of 2019, compared to $43.5 million for the first quarter of
2018. The increase year over year is primarily due to higher research
and development costs for rucaparib clinical trials, including increased
enrollment in ongoing ovarian and prostate studies, increased costs
related to initiating new ovarian and bladder studies during 2018, as
well as additional headcount to support these increased rucaparib
clinical trial activities.

Selling, general and administrative expenses totaled $47.8 million for
the first quarter of 2019, compared to $39.3 million for the comparable
period in 2018. The increase year over year is primarily due to higher
selling, general and administrative expenses related to the
commercialization of Rubraca in the U.S. and the EU, including facility
expenses and personnel expenses associated with expanding the EU
infrastructure.

Clovis recently entered into an agreement for up to $175 million in
non-dilutive clinical trial financing with certain affiliates of TPG
Sixth Street Partners to reimburse Clovis’ costs and expenses related to
the ATHENA clinical trial. ATHENA is Clovis Oncology’s largest clinical
trial, with a planned target enrollment of 1,000 patients across more
than 270 sites in at least 25 countries. For further details, please see
the Clovis news release and report on Form 8-K, dated May 2, 2019
available on the Company’s website.

Key Milestones and Objectives for Rubraca

Recurrent Ovarian Cancer Maintenance Treatment Indication Approved in
the EU and Launched in Germany and UK

In January 2019, the European Commission (EC) approved the use of
Rubraca for its second indication, as monotherapy for the maintenance
treatment of adults with platinum-sensitive relapsed high-grade
epithelial ovarian, fallopian tube, or primary peritoneal cancer who are
in response (complete or partial) to platinum-based chemotherapy. With
this approval, Rubraca’s indication is expanded beyond its initial
marketing authorization in the EU granted in May 2018, and in this
indication Rubraca is available to eligible patients regardless of their
BRCA mutation status. Rubraca is the first PARP inhibitor licensed for
an ovarian cancer treatment indication in Europe and is the first to be
available for both treatment and maintenance treatment among eligible
patients with ovarian cancer. Clovis launched Rubraca in Germany and in
the private pay market in the UK in March and anticipates launching in
other EU countries later in 2019 and 2020.

Regulatory Path for Supplemental NDA in BRCA-mutant Advanced Prostate
Cancer

Initial data from the Company’s ongoing TRITON studies of Rubraca in
advanced prostate cancer were presented at the ESMO 2018 Congress
(European Society for Medical Oncology) in October 2018. The initial
TRITON2 data showed a 44 percent confirmed objective response rate (ORR)
by investigator assessment in 25 RECIST1/PCWG3**
response-evaluable patients with a BRCA1/2 alteration, and
results by independent assessment were consistent. The median duration
of response in these patients had not yet been reached. In addition, a
51 percent confirmed prostate specific antigen (PSA) response rate was
observed in 45 PSA response-evaluable patients with a BRCA1/2
alteration. Preliminary safety data for Rubraca in men with mCRPC were
consistent with those observed in patients with ovarian cancer and other
solid tumors.

The TRITON2 results were the basis for Breakthrough Therapy designation
for Rubraca as a monotherapy treatment of adult patients with BRCA1/2
mutant mCRPC who have received at least one prior androgen receptor
(AR)-directed therapy and taxane-based chemotherapy, which was granted
on October 1, 2018 by the U.S. Food and Drug Administration (FDA). Both
studies in the TRITON program, TRITON2 and TRITON3, continue to enroll
patients.

As a result of Rubraca’s breakthrough therapy status, Clovis agreed to
provide regular updates to FDA on the Company’s advanced prostate cancer
development program on a regular basis. At the end of April 2019, Clovis
provided an update to FDA on 52 patients with BRCA-mutant mCRPC that
showed a RECIST response rate and PSA response highly consistent with
the data presented at ESMO 2018. Clovis expects to discuss this update
with FDA in the next several weeks. Clovis intends to file the planned
supplemental NDA by the end of 2019.

Rubraca Clinical Development

Clovis has a robust clinical development program underway in multiple
tumor types, including Clovis-sponsored, partner-sponsored and
investigator-initiated trials. The following Clovis-sponsored clinical
studies are open for enrollment or are anticipated to open during the
next several months:

Also, a Phase 2 combination study of Opdivo with Rubraca for the
treatment of mCRPC is underway. This study, sponsored by Bristol-Myers
Squibb, is being conducted as an arm in the CHECKMATE 9KD prostate
cancer study, and is currently enrolling patients. Exploratory studies
in other tumor types are also underway, as well as active discussions
with Bristol-Myers Squibb regarding additional potential combination
studies.

Lucitanib Clinical Development

Lucitanib is an investigational, oral, potent inhibitor of the tyrosine
kinase activity of vascular endothelial growth factor receptors 1
through 3 (VEGFR1-3), platelet-derived growth factor receptors alpha and
beta (PDGFRα/β) and fibroblast growth factor receptors 1 through 3
(FGFR1-3), which was previously evaluated in breast and lung cancers in
partnership with Servier. Clovis has global rights (excluding China) for
lucitanib.

Recent data for a drug that inhibits these same three pathways – when
combined with a PD-1 inhibitor – are extremely encouraging and represent
a scientific rationale for the development of lucitanib in combination
with a PD-1 inhibitor, and a Clovis-sponsored study of lucitanib in
combination with Opdivo is planned in gynecologic and other tumor types.
Clovis also intends to initiate a study of lucitanib in combination with
rucaparib in ovarian cancer as an arm of the SEASTAR study mentioned
above, based on encouraging data of VEGF and PARP inhibitors in
combination. Each of these Phase 1b/2 studies is expected to initiate in
mid-2019.

During the second quarter, Clovis and Alkermes initiated a preclinical
research collaboration to evaluate ALKS 4230, Alkermes’ investigational
engineered interleukin-2 (IL-2) variant immunotherapy, in combinations
with rucaparib and lucitanib.

Conference Call Details

Clovis will hold a conference call to discuss First Quarter 2019 results
this morning, May 7, at 8:30am ET. The conference call will be
simultaneously webcast on the Company’s web site at www.clovisoncology.com,
and archived for future review. Dial-in numbers for the conference call
are as follows: US participants 877.698.7048, International participants
647.689.5448, conference ID: 8567356.

About Rubraca (rucaparib)

Rubraca is an oral, small molecule inhibitor of PARP1, PARP2 and PARP3
being developed in ovarian cancer as well as several additional solid
tumor indications. Studies open for enrollment or under consideration
include ovarian, prostate, breast, gastroesophageal, pancreatic, and
lung cancers. Clovis holds worldwide rights for Rubraca.

In the United States, Rubraca is approved for the maintenance treatment
of adult patients with recurrent epithelial ovarian, fallopian tube, or
primary peritoneal cancer who are in a complete or partial response to
platinum-based chemotherapy. Rubraca is also approved in the United
States for the treatment of adult patients with deleterious BRCA
mutation (germline and/or somatic) associated epithelial ovarian,
fallopian tube, or primary peritoneal cancer who have been treated with
two or more chemotherapies and selected for therapy based on an
FDA-approved companion diagnostic for Rubraca.

In the EU, Rubraca is approved for the maintenance treatment of adults
with platinum-sensitive relapsed high-grade epithelial ovarian,
fallopian tube, or primary peritoneal cancer who are in response
(complete or partial) to platinum-based chemotherapy. This expands
rucaparib’s indication beyond its initial marketing authorization in the
EU granted in May 2018 and with this label expansion, rucaparib is now
available to patients regardless of their BRCA mutation status. Rubraca
is also approved in the EU for the treatment of adult patients with
platinum sensitive, relapsed or progressive, BRCA mutated (germline
and/or somatic), high-grade epithelial ovarian, fallopian tube, or
primary peritoneal cancer, who have been treated with two or more prior
lines of platinum-based chemotherapy, and who are unable to tolerate
further platinum-based chemotherapy.

Rubraca is an unlicensed medical product outside of the U.S. and the EU.

About
Clovis Oncology

Clovis Oncology, Inc. is a biopharmaceutical company focused on
acquiring, developing and commercializing innovative anti-cancer agents
in the U.S., Europe and additional international markets. Clovis
Oncology targets development programs at specific subsets of cancer
populations, and simultaneously develops, with partners, for those
indications that require them, diagnostic tools intended to direct a
compound in development to the population that is most likely to benefit
from its use. Clovis Oncology is headquartered in Boulder, Colorado,
with additional office locations in the U.S. and Europe. Please visit www.clovisoncology.com
for more information.

To the extent that statements contained in this press release are not
descriptions of historical facts regarding Clovis Oncology, they are
forward-looking statements reflecting the current beliefs and
expectations of management. Examples of forward-looking statements
contained in this press release include, among others, statements
regarding our plans for commercial launch in additional countries,
expectations for submission of regulatory filings, our plans to present
final or interim data on ongoing clinical trials, our plans to submit
additional data to, or meet with, the FDA with respect to the status of
or plans for ongoing or planned trials, the timing and pace of
commencement of and enrollment in our clinical trials and the cost of
certain trials, including those being considered, planned or conducted
in collaboration with partners, our plans for commencement of additional
planned trials, the potential results of such clinical trials, changes
in drug supply timing and costs and other expenses and statements
regarding our expectations of the supply of free drug distributed to
eligible patients and our expectations regarding the total amount of
funding that may be available to us under the agreement with TPG Sixth
Street Partners. Such forward-looking statements involve substantial
risks and uncertainties that could cause our future results, performance
or achievements to differ significantly from that expressed or implied
by the forward-looking statements. Such risks and uncertainties include,
among others, the uncertainties inherent in the market potential of our
approved drug, including the performance of our sales and marketing
efforts and the success of competing drugs and therapeutic approaches,
the performance of our third-party manufacturers, our clinical
development programs for our drug candidates and those of our partners,
whether future study results will be consistent with study findings to
date and whether future study results will support continued development
or regulatory approval, the corresponding development pathways of our
companion diagnostics, the timing of availability of data from our
clinical trials and the results, the initiation, enrollment, timing and
results of our planned clinical trials, the risk that final results of
ongoing trials may differ from initial or interim results as a result of
factors such as final results from a larger patient population may be
different from initial or interim results from a smaller patient
population, actions by the FDA, the EMA or other regulatory authorities
regarding data required to support drug applications and whether to
accept or approve drug applications that may be filed, as well as their
decisions regarding drug labeling, reimbursement and pricing, and other
matters that could affect the development, availability or commercial
potential of our drug candidates or companion diagnostics. Clovis
Oncology does not undertake to update or revise any forward-looking
statements. A further description of risks and uncertainties can be
found in Clovis Oncology’s filings with the Securities and Exchange
Commission, including its Annual Report on Form 10-K and its reports on
Form 10-Q and Form 8-K.

1   Response Evaluation Criteria in Solid Tumors (RECIST) is a
standardized methodology for determining therapeutic response to
anticancer therapy using changes in lesion appearance on imaging
studies.
 
** Prostate Cancer Working Group (PCWG3) is an international expert
committee of prostate cancer clinical investigators who have
recommended modifications to RECIST for use in the conduct of trials
in metastatic castration-resistant prostate cancer (mCRPC) which
were adopted in the TRITON2 protocol.
 
 

CLOVIS ONCOLOGY, INC.

CONSOLIDATED FINANCIAL RESULTS
(Unaudited, in thousands, except per share amounts)
     
Three Months Ended March 31,
2019 2018
Revenues:
Product revenue $ 33,118   $ 18,523  
 
Operating expenses:
Cost of sales – product 7,405 4,006
Cost of sales – intangible asset amortization 1,120 372
Research and development 62,031 43,543
Selling, general and administrative   47,761     39,274  
Total expenses   118,317     87,195  
 
Operating loss (85,199 ) (68,672 )
 
Other income (expense):
Interest expense (3,590 ) (2,635 )
Foreign currency loss (192 ) (81 )
Legal settlement loss – (7,975 )
Other income   2,400     1,409  
Other income (expense), net   (1,382 )   (9,282 )
 
Loss before income taxes (86,581 ) (77,954 )
Income tax benefit   160     260  
Net loss $ (86,421 ) $ (77,694 )
 
Basic and diluted net loss per common share $ (1.63 ) $ (1.54 )
 
Basic and diluted weighted-average common shares outstanding 52,891 50,602
 
 
RECONCILIATION OF GAAP TO NON-GAAP
NET LOSS AND NET LOSS PER SHARE
(Unaudited, in thousands, except per share amounts)
     
Three Months Ended March 31,
2019 2018
 
GAAP net loss $ (86,421 ) $ (77,694 )
Adjustments:
Legal settlement loss (1) – 7,975
 
Non-GAAP net loss $ (86,421 ) $ (69,719 )
 
GAAP net loss per common share $ (1.63 ) $ (1.54 )
 
Non-GAAP net loss per common share $ (1.63 ) $ (1.38 )

 

The Company prepares its consolidated financial statements in
accordance with U.S. GAAP. This press release also contains non-GAAP
measurements of net loss and net loss per common share that the
Company believes provide useful supplemental information relating to
operating performance and trends and facilitates comparisons with
other periods. These non-GAAP financial measures should be
considered in addition to, but not as a substitute for, the
information prepared in accordance with U.S. GAAP.
 
Explanation of adjustments:
(1) During the three months ended March 31, 2018, the Company
recorded a one-time charge of $8.0 million related to an agreement
to resolve a potential litigation claim against us and certain of
our officers.
 
 
CONSOLIDATED BALANCE SHEET DATA
(Unaudited, in thousands)
       
March 31, 2019 December 31, 2018
 
Cash and cash equivalents $ 123,308 $ 221,876
Available-for-sale securities 283,474 298,270
Working capital 360,655 446,550
Total assets 784,617 863,560
Convertible senior notes 576,003 575,470
Common stock and additional paid-in capital 2,048,928 2,034,195
Total stockholders’ equity 74,851 146,469
 
 
Other Data
(Unaudited, in thousands)
    Three Months Ended March 31,
2019   2018
 
Net cash used in operating activities (98,451 ) (100,635 )
 
Share Based Compensation Expense 13,640 11,913
 
 
Other Information
($ in millions)
   
Share-based compensation Q1 2019 13.6
 
Share-based compensation Q1 2018 11.9
 
Net cash used in operating activities Q1 2019 (98.5 )
 
Net cash used in operating activities Q1 2018 (100.6 )

Contacts

Breanna Burkart
303.625.5023
bburkart@clovisoncology.com

Anna Sussman
303.625.5022
asussman@clovisoncology.com

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