Bay Area’s Dynavax Shifts Focus to Immune-Oncology, Cuts 40% of Staff

Bay Area’s Dynavax Shifts Focus to Immune-Oncology, Cuts 40% of Staff March 13, 2017
By Mark Terry, BioSpace.com Breaking News Staff

Dynavax , headquartered in Berkeley, Calif., published its fourth quarter and year-end 2016 financials today.

It was a mixed year in many ways. The U.S. Food and Drug Administration (FDA) issued a Complete Response Letter (CRL) in November 2016 for the Biologics License Application (BLA) for HEPLISAV-B, Dynavax’s vaccine against hepatitis B infection. However, on February 28, 2017, the company announced that the FDA had accepted the company’s responses to the CRL for review. The PDUFA action date is August 10, 2017.

On March 6, 2017, Dynavax released data from its Phase Ib/II trial of SD-101, the company’s intratumoral TLR9 agonist, in combination with Keytruda (pembrolizumab), an anti-PD-1 compound from Merck , in metastatic melanoma. Results were promising.

“We are pleased with the response in the anti-PD-1 naïve group with two complete responses and tumor shrinkage in all seven evaluable patients,” said Robert Janssen, chief medical officer of Dynavax, in a statement. “In addition, we are encouraged to have seen a partial response at the highest dose in the anti-PD-1 refractory group with little toxicity. This allows us to explore higher doses of SD-101 in anti-PD-1 refractory patients in the expansion phase to further develop the best path forward for this hard to treat population.”

Because of the positive results, the trial is being expanded into Phase II trials in both melanoma and head and neck cancer.

Otherwise, the company reported a net loss for 2016 of $112.4 million, or $2.92 per share, compared to $106.8 million, or $3.25 per share from the previous year. Dynavax holds $81.4 million in cash, cash equivalents and marketable securities, compared to $196.1 million at the end of the previous year. Also, in the first quarter of this year, Dynavax received $23.3 million from sales of common stock by way of an at-the-market sales agreement.

In January, at least partially in response to the setback with HEPLISAV-B, the company announced restructuring activities, which included cutting about 40 percent of its workforce. It also suspended manufacturing activities, commercial preparations and long-term investments related to HEPLISAV-B.

“We are pleased with the continued progress of our immune-oncology portfolio during 2016 and the recent promising clinical results from our combination trial in melanoma,” said Eddie Gray, Dynavax’ chief executive officer, in a statement. “With the expansion of SD-101 into Phase II in both melanoma and head and neck cancer this quarter, our marketing application for HEPLISAV-B under review by the FDA and our strong cash balance, we are in position to deliver key outcomes for several programs during 2017.”

The company’s total revenues for 2016 were $11.0 million, with $7.3 million coming in the fourth quarter. That is up from $4.1 million for the full year of 2015.

Research and development expenses were $84.5 million for 2016 compared to $86.9 million in 2015. General and administrative expenses were $37.3 million in 2016, up from $22.2 million in 2015. The increase was related to preparations for the anticipated launch of HEPLISAV-B, as well as “additional headcount, information technology systems and infrastructure to support commercial development as well as costs related to sourcing a debt financing commitment.”

The January restructuring focused primarily on shifting the company’s priorities toward its immuno-oncology portfolio, while still being able to proceed with hits HEPLISAV-B program.

“We value all of our colleagues, so reducing our workforce is a sad and difficult decision,” Gray said in a statement in January. “But it is one we believe is necessary to align our organization to reflect that of a clinical R&D-stage company with a promising immuno-oncology pipeline, which has become a strategically important area of our business and one we believe can potentially benefit thousands of people with cancer. These measures will increase our financial strength and position us well to create significant long-term clinical and financial value.”

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