Clovis
Oncology, Inc. (NASDAQ:CLVS) reported financial results for the
quarter ended June 30, 2018, and provided an update on the Company’s clinical
development programs and regulatory and commercial outlook for the
second half of 2018.
“We are pleased with the launch of Rubraca in the broader maintenance
indication in the U.S. and are preparing for the planned launch in the
EU early next year,” said Patrick J. Mahaffy, CEO and President of
Clovis Oncology. “We look forward to the presentation of the initial
data for rucaparib in patients with germline or somatic BRCA
mutation-positive metastatic castrate-resistant prostate cancer at ESMO
in October, and we are actively advancing multiple combination studies
for each of rucaparib and lucitanib.”
Second Quarter 2018 Financial Results
Clovis reported net product revenue for Rubraca of $23.8 million for the
second quarter of 2018 following the label expansion to include the
earlier-line and all-comers ovarian cancer maintenance treatment
indication on April 6. The supply of free drug distributed to eligible
patients through the Rubraca patient assistance program for the three
months ended June 30, 2018 was an additional approximately 25 percent of
the overall commercial supply, or the equivalent of $7.9 million in
commercial value. In the six months ended June 30, 2018, the supply of
this free drug was an additional approximately 24 percent of the overall
commercial supply, or the equivalent of $13.4 million in commercial
value. The Company expects the free product percentage to continue in
the mid to high 20-percent range for the remainder of 2018. Net product
revenue for the first quarter of 2018 was $18.5 million, for a total of
$42.3 million for the first six months of 2018. Net product revenue for
the quarter and first half ended June 30, 2017 was $14.6 million and
$21.7 million, following the initial approval and launch of Rubraca in
the treatment setting on December 19, 2016.
Clovis had $682.2 million in cash, cash equivalents and
available-for-sale securities as of June 30, 2018. Cash used in
operating activities was $110.2 million for the second quarter of 2018
and $210.8 million for the first half of 2018, compared with $69.1
million for the second quarter of 2017 and $149.5 million for the first
half of 2017. This includes product supply costs of $44.6 million in the
second quarter of 2018 and $76.1 million in the first half of 2018
related to Clovis’ previously-described plan to build additional
inventory in advance of the transition to a new manufacturing facility
for Rubraca. Product supply costs are expected to be approximately $10
million for the remainder of 2018. The Company also expects to incur
final capital costs for the new manufacturing facility of approximately
$8 million in late 2018. Additionally, and also as previously described,
Clovis made one-time milestone payments to Pfizer of $58 million in the
second quarter of 2018 related to U.S. product approvals in December
2016 and April 2018 and European product approval in May 2018.
Clovis reported a net loss for the second quarter of 2018 of $101.2
million, or ($1.94) per share, and $178.9 million, or a net loss of
($3.48) per share for the first half of 2018. Net loss was $175.4
million, or a net loss of ($3.88) per share for the second quarter of
2017, and $233.8 million, or a net loss of ($5.24) per share for the
first half of 2017.
During the second quarter of 2018, Clovis recorded a one-time charge of
$20.0 million related to an agreement in principle reached with the
S.E.C. that, if approved by the S.E.C. and the U.S. District Court where
the settlement is to be filed, would resolve the S.E.C.’s investigation
related to rociletinib.
Additionally, the net loss for the six months ended June 30, 2018 also
includes a charge of $8.0 million in the first quarter related to a
legal settlement. The net loss for the quarter and six months ended June
30, 2017 included a charge of $117.0 million related to a legal
settlement.
The adjusted net loss excluding these items was $81.2 million, or
($1.55) per share for the second quarter, and $150.9 million, or ($2.93)
per share for the first half of 2018, compared to an adjusted net loss
of $58.4 million, or ($1.29) per share for the second quarter, and
$116.8 million, or ($2.62) per share for the first half of 2017. Net
loss for the second quarter and first half of 2018 included share-based
compensation expense of $14.9 million and $26.8 million, compared to
$10.7 million and $19.6 million for the comparable periods of 2017.
Clovis had approximately 52.6 million shares of common stock outstanding
as of June 30, 2018.
Research and development expenses totaled $52.7 million for the second
quarter of 2018 and $96.3 million for the first half of 2018, compared
to $33.1 million and $65.6 million for the comparable periods in 2017.
Research and development expenses will continue to increase compared to
last year as planned Rubraca studies progress.
Selling, general and administrative expenses totaled $44.9 million for
the second quarter of 2018 and $84.1 million for the first half of 2018,
compared to $36.1 million and $65.4 million for the comparable periods
in 2017. Selling, general and administrative expenses will continue to
increase compared to last year in support of administrative and
commercial activities related to Rubraca in the United States and Europe.
Key Milestones and Objectives for Rubraca
U.S. Approval for Ovarian Cancer Maintenance Treatment Indication
On April 6, the U.S. Food and Drug Administration (FDA) approved Rubraca
(rucaparib) tablets 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. FDA granted regular approval for Rubraca in
this second, broader and earlier-line indication on a priority review
timeline based on positive data from the phase 3 ARIEL3 clinical trial.
Biomarker testing is not required for patients to be prescribed Rubraca
in this maintenance treatment indication. In addition to granting
Rubraca approval in this second indication, the FDA converted the
approval of the initial treatment indication from an accelerated to a
regular approval.
European Union (EU) Authorization Granted for Recurrent Ovarian
Cancer Treatment Indication and Maintenance Treatment Variation Under
Review
In late May, the Company announced that the European Commission
authorized Rubraca as monotherapy 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.
Following the receipt of the initial Marketing Authorization for
Rubraca, Clovis submitted a variation to include the maintenance
indication, which was validated by the European Medicines Agency (EMA)
in early July. The review is underway and an opinion for the maintenance
indication from the Committee for Medicinal Products for Human Use
(CHMP) is anticipated by the end of 2018. Clovis continues to establish
its EU organization to support the planned launch of Rubraca in Europe.
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 clinical studies are open
for enrollment or are anticipated to open during the next several months:
Exploratory studies in other tumor types are also underway.
Additionally, in June, the Company announced a planned clinical
collaboration with Immunomedics to evaluate the combination of Rubraca
and sacituzumab govitecan as a treatment for advanced metastatic
triple-negative breast and metastatic urothelial cancers.
Lucitanib Clinical Development
Lucitanib is an 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 (PDGFR?/?) 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 received notice from Servier that they will return
their ex-US rights (excluding China) for lucitanib later in 2018. Clovis
therefore will own global rights (excluding China) to lucitanib. There
are no payments from Clovis to Servier related to the return of these
ex-US rights.
Lucitanib was originally developed by Clovis and Servier with the
hypothesis of activity in FGFR driven tumors; data in breast and lung
cancer were insufficient to move the program forward. Recent data for a
similar drug that inhibits these same three pathways – when combined
with a PD-1 inhibitor – are extremely encouraging and represent a
validated and alternative hypothesis for the development of lucitanib in
combination with a PD-(L)1 inhibitor, and a Clovis-sponsored combination
study is now being planned. Clovis also intends to initiate a study of
lucitanib in combination with rucaparib, based on encouraging data of
VEGF and PARP inhibitors in combination. Each of these studies is
expected to initiate before the end of Q1 2019.
Conference Call Details
Clovis will hold a conference call to discuss Q2 2018 results this
afternoon, August 1, at 4:30pm 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 866.489.9022, International participants
678.509.7575, conference ID: 9289064.
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, lung
and bladder 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.
Rubraca is an unlicensed medical product outside of the U.S. and 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, 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, and has additional offices in San
Francisco, California and Cambridge, UK. Please visit 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 made pursuant to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995. Examples of
forward-looking statements contained in this press release include,
among others, statements regarding our expectation of timing for review
and approval of the MA variation for rucaparib, our expectations for
submission of regulatory filings, our plans to present final or interim
data on ongoing clinical trials, the timing and pace of commencement of
and enrollment in our clinical trials, including those being planned or
conducted in collaboration with partners, changes in drug supply timing
and costs and other expenses, statements regarding our expectations of
the supply of free drug distributed to eligible patients and the final
terms and timing of the expected SEC settlement. 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, the performance of our third-party manufacturers, our
clinical development programs for our drug candidates and those of our
partners, the corresponding development pathways of our companion
diagnostics, the timing of availability of data from our clinical trials
and the results, the initiation, enrollment and timing of our planned
clinical trials, actions by the FDA, the EMA or other regulatory
authorities regarding 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, and actions and decisions of the SEC and the
U.S. District Court where the settlement is to be filed. 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.
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 June
30, 2018, the Company recorded a one-time charge of $20.0 million
related to a preliminary agreement reached with the SEC that, if
approved by the SEC and U.S. District Court where the settlement is
filed, would resolve the SEC’s pending investigation.
During the three months ended June 30, 2017, the Company recorded a
$117.0 million legal settlement loss related to a stipulation and
agreement of settlement entered into between the Clovis Defendants and
the plaintiffs to the Consolidated Complaint.
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.
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