IOVANCE BIOTHERAPEUTICS, INC. (IOVA) SPO
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|Company Name||IOVANCE BIOTHERAPEUTICS, INC.|
|Company Address||999 SKYWAY ROAD
SAN CARLOS, CA 94070
|Employees (as of 12/31/2016)||51|
|State of Inc||DE|
|Fiscal Year End||12/31|
|Shares Over Alloted||0|
|Shareholder Shares Offered||--|
|Lockup Period (days)||180|
|Quiet Period Expiration||3/5/2018|
We estimate that the net proceeds from our issuance and sale of $125.0 million of shares of common stock in this offering will be approximately $117.0 million, or approximately $134.6 million if the underwriters exercise their option to purchase additional shares in full, after deducting the estimated underwriting discounts and commissions and the estimated offering expenses payable by us. We intend to use the net proceeds of this offering to fund our ongoing clinical trials for our current product candidates, including our on-going Phase 2 clinical trials of LN-144, TIL for the treatment of metastatic melanoma, and LN-145, TIL for the treatment of cervical and head and neck cancers, to fund our planned clinical trials for our current product candidates, including our planned Phase 2 clinical trial of LN-145 for the treatment of non-small cell lung cancer, or NSCLC, in collaboration with MedImmune, as well as the NSCLC study in collaboration with the H. Lee Moffitt Cancer Center and Research Institute and our planned clinical trials in multiple solid tumor cancers with The University of Texas M.D. Anderson Cancer Center, to fund additional clinical trials to move the TIL therapy to earlier line of treatment, to fund activities related to commercial scale-up of our third party manufacturing operations and for working capital and other general corporate purposes. We may also use a portion of the net proceeds to invest in or acquire businesses or technologies that we believe are complementary to our own, although we have no current plans, commitments or agreements with respect to any acquisitions as of the date of this prospectus supplement. Pending these uses, we plan to invest these net proceeds in investment-grade, interest bearing securities. These expected uses represent our intentions based upon our current plans and business conditions, which could change in the future as our plans and business conditions evolve. The amounts and timing of our actual expenditures may vary significantly depending on numerous factors, including the progress of our development, the status of and results from clinical trials, and any unforeseen cash needs. As a result, our management will have broad discretion in the application of the net proceeds from this offering, and investors will be relying on the judgment of our management regarding the application of the net proceeds from this offering. The timing and amount of our actual expenditures will be based on many factors, including cash flows from operations and the anticipated growth of our business.
The biotechnology and pharmaceutical industries put significant resources in developing novel and proprietary therapies for the treatment of cancer. We compete with many different sources in the space of immunotherapy, including large and specialty pharmaceutical and biotechnology companies, academic research institutions and governmental agencies and public and private research institutions, as well as companies developing novel targeted therapies for cancer. Universities and public and private research institutions in the U.S. and Europe are also potential competitors. For example, a Phase 3 study comparing TIL to standard ipilimumab in patients with metastatic melanoma is currently being conducted in Europe by the Netherlands Cancer Institute, the Copenhagen County Herlev University Hospital, and the University of Manchester. While these universities and public and private research institutions primarily have educational objectives, they may develop proprietary technologies that lead to other FDA approved therapies or that secure patent protection. We anticipate that we will face possibly increasing competition as new drugs and therapies enter the market and advanced technologies become available. Due to their promising clinical therapeutic effect in clinical exploratory trials, we anticipate substantial direct competition from other organizations developing advanced T-cell therapies. In particular, we expect to compete with therapies with genetically engineered T cells rendered reactive against tumor-associated antigens prior to their administration to patients. Genetically engineered T cells are being pursued by several companies, including Adaptimmune, Celgene (in collaboration with bluebird bio), Kite Pharma, Juno Therapeutics, Novartis and others. To date, these technologies have been applicable to hematologic malignancies, but it is conceivable that such genetic modification may be applied further to TIL and create competition with Lion. While other types of cancer immunotherapies may potentially be used in combination with TIL, such as checkpoint blockers, to enhance efficacy, we also expect substantial direct competition from other types of immunotherapies. We face competition from immunotherapy treatments offered by companies such as Amgen, AstraZeneca, Bristol-Myers, Merck, and Roche. Immunotherapy is also being pursued by several biotechnology companies as well as by large-cap pharmaceutical companies. We cannot predict whether other types of immunotherapies may be enhanced and show greater efficacy and may have direct and substantial competition from such immunotherapies in the future. Many potential competitors, either alone or with their strategic partners, have substantially greater financial, technical and human resources than we do. Accordingly, our competitors may be more successful than us in obtaining approval for treatments and achieving widespread market acceptance and may render our treatments obsolete or non-competitive. Mergers and acquisitions in the biotechnology and pharmaceutical industries may result in even more resources being concentrated among a smaller number of our competitors. These competitors also compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical study sites and patient registration for clinical studies, as well as in acquiring technologies complementary to, or necessary for, our programs. Smaller or early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. Our commercial success may depend in part on our ability to obtain and maintain patent and other proprietary protection for commercially important technology, inventions and know-how related to our business; defend and enforce our patents; preserve the confidentiality of our trade secrets; and operate without infringing the valid enforceable patents and proprietary rights of third parties. Our ability to stop third parties from making, using, selling, offering to sell or importing our products may depend on the extent to which we have rights under valid and enforceable patents or trade secrets that cover these activities. With respect to both licensed and company-owned intellectual property, we cannot be sure that patents will be granted with respect to any of our pending patent applications or with respect to any patent applications filed by us in the future, nor can we be sure that any of our existing patents or any patents that may be granted to us in the future will be commercially useful in protecting our commercial products and methods of manufacturing the same. We may rely, in some circumstances, on trade secrets to protect our technology. However, trade secrets can be difficult to protect. We seek to protect our proprietary technology and processes, in part, by entering into confidentiality agreements with our employees, consultants, scientific advisors and contractors. We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems. While we have confidence in these individuals, organizations and systems, agreements or security measures may be breached, and we may not have adequate remedies for any breach. In addition, our trade secrets may otherwise become known or be independently discovered by competitors. To the extent that our consultants, contractors or collaborators use intellectual property owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions.
We are a clinical-stage biopharmaceutical company focused on the development and commercialization of novel cancer immunotherapy products designed to harness the power of a patient’s own immune system to eradicate cancer cells. Our lead product candidate, LN-144 for metastatic melanoma, is an
autologous adoptive cell therapy utilizing tumor-infiltrating lymphocytes, or TIL, which are T cells derived from patients’ tumors. TIL therapy is a platform technology that has already been applied to the treatment of metastatic melanoma and metastatic cervical cancer by the National Cancer Institute, or NCI. We are investigating the effectiveness of TIL therapy for the treatment of metastatic melanoma, squamous cell carcinoma of the head and neck, cervical carcinoma, and metastatic non-small cell lung cancer, as well as other oncology indications. A patient’s immune system, particularly his or her TIL, plays an important role in identifying and killing cancer cells. TIL product consists of a polyclonal population of T cells that can recognize a wide variety of cancer-specific mutations. TIL treatment targets tumors through the polyclonal nature of the TIL product, and is able to overcome the hostile tumor microenvironment because of (a) the non-myeloablative chemotherapy that is a component of TIL therapy and (b) the nature of the TIL cells themselves. TIL therapy involves four steps: (i) growing a patient’s TIL outside the patient’s body, or ex vivo; (ii) administering non-myeloablative chemotherapy; (iii) infusing the TIL back into the patient; and (iv) subsequent infusions of up to six doses of interleukin-2 (IL-2). By expanding a patient’s TIL ex vivo away from the immunosuppressive tumor microenvironment, the T cells can rapidly proliferate. As a result, billions of TIL cells, when infused back into the patient, are better able to potentially eradicate tumors. Manufacturing of TIL historically has typically taken 5-6 weeks and has yielded a fresh, non-cryopreserved TIL product. We have developed a new manufacturing method that reduces the duration of manufacture of the TIL product to 22 days, and allows for production of a cryopreserved TIL product. We refer to our new manufacturing method as Generation 2, or Gen 2, manufacturing. We own the intellectual property associated with Gen 2 manufacturing. In late 2017, we selected Gen 2 as the manufacturing method for TIL product to be used in all our ongoing and upcoming trials. The cryopreserved TIL product offers greater flexibility in scheduling the dosing of patients, reduces the period for patients to wait until they receive their TIL product infusion, and reduces the cost of manufacture. We are pursuing metastatic melanoma as our first target indication because of the promising initial results in this indication generated by Dr. Steven Rosenberg, M.D., Ph.D., Chief of the Surgery Branch of the NCI, and the commercial opportunity inherent in the significant unmet need of this patient population. Melanoma is a common type of skin cancer, accounting for 87,110 patients diagnosed and 9,730 deaths in 2017 in the United States according to the American Cancer Society’s Cancer Estimates for 2017. According to the NCI’s Surveillance, Epidemiology and End Results, or SEER, program, about 2-5% of patients with melanoma have metastatic disease. Patients with metastatic melanoma following treatment under the current standards of care have a particularly dire prognosis with very few curative treatment options. We have an on-going Phase 2 clinical trial, C-144-01, of our lead product candidate, LN-144, TIL for the treatment of metastatic melanoma. This multicenter study is enrolling patients with melanoma whose disease has progressed following treatment with at least one systemic therapy, including anti-PD-1 and if BRAF mutated, a BRAF inhibitor. The trial is currently active at eleven U.S. sites. We anticipate initiating patient dosing in Europe during the first half of 2018. The purpose of the study is to evaluate the efficacy and safety of our autologous LN-144. The trial’s primary objective is to characterize the efficacy of LN-144. Secondary outcome measures for safety and efficacy of LN-144 include objective response and complete response rates. Additional secondary or exploratory endpoints may be evaluated as well. On December 13, 2017, we reported updated results from cohort 2 of the C-144-01 study. The data reported showed clinically meaningful outcomes with a 40% Objective Response Rate, or ORR, (per the Response Evaluation Criteria in Solid Tumors, or RECIST, v1.1), which included four partial responses observed in ten efficacy-evaluable patients. We anticipate the ORR reported from these patients may change as we continue to enroll patients and record responses. The efficacy-evaluable patients had a high tumor burden despite a median of 3.6 prior therapies including both anti-CTLA and PD-1 prior treatments. The most common side effects of any grade were pyrexia, anemia and decreased neutrophil count. We have decided to use our Gen 2 manufacturing process for all ongoing Phase 2 trials and in all future TIL clinical development in trials sponsored by us, and as a result, cohort 1 of the C-144-01 melanoma study is closed to enrollment, and new patients are being enrolled in cohort 2. We received orphan drug designation by the U.S. Food and Drug Administration, or FDA, for LN-144 in the United States to treat malignant melanoma stages IIB-IV. This designation provides seven years of market exclusivity in the United States, subject to certain limited exceptions. However, the orphan drug designation does not convey any advantage in or shorten the duration of the regulatory review or approval process. On August 31, 2017, we were granted Fast Track designation by the FDA for LN-144, TIL in advanced melanoma. In addition to our ongoing trial in metastatic melanoma, we have initiated clinical trials of TIL therapy in cervical, and head and neck cancers. C-145-03 is a Phase 2, multicenter study that will enroll up to 47 patients and will assess the safety and efficacy of LN-145 for the treatment of patients with recurrent and/or metastatic squamous cell carcinoma of the head and neck. The trial has met the efficacy threshold for the first stage of the Simon’s two-stage design and will therefore continue to enroll patients to the full sample size of 47 per protocol. C-145-04 is a Phase 2, multicenter study, designed as a Simon’s two-stage design to enroll up to 47 patients and will assess the safety and efficacy of LN-145 for the treatment of patients with recurrent, metastatic, or persistent cervical carcinoma. The study is open for enrollment of patients in the Unites States and we anticipate the start of enrollment of patients in Europe in the first half of 2018. We have amended the protocol so that newly enrolled patients in both of these trials can be treated using TIL produced from our Gen 2 manufacturing process. We are initiating our clinical development around non-small cell lung cancer, or NSCLC, with two studies. One of the studies is an investigator sponsored study being conducted at H. Lee Moffitt Cancer Center and Research Institute, or Moffitt, and the other is sponsored by Iovance. Patient enrollment has begun in the study in collaboration with researchers at Moffitt, Stand Up To Cancer, and other collaborators. Patients who are treatment naïve to prior anti-PD-1/ PD-L1 with stage IV or recurrent NSCLC will be enrolled in a study combining TIL and nivolumab. The Iovance-sponsored Phase 2 study in patients with NSCLC who are PD-1 and PD-L1 naïve, in collaboration with MedImmune, the global biologics research and development arm of AstraZeneca, will initiate in the first half of 2018. The study with MedImmune will allow for enrollment with LN-145 alone or in combination with durvalumab. In the future, we plan to initiate additional indications alone or through collaborations. We are also initiating clinical trials as part of our strategic alliance with The University of Texas M.D. Anderson Cancer Center, or M.D. Anderson, in multiple solid tumor cancers using two different TIL manufacturing processes, including our Gen 2 manufacturing process. These multi-arm clinical trials will evaluate the safety and efficacy of TIL therapy in ovarian cancer, various sarcomas, and pancreatic cancer, and are expected to begin enrollment in 2018. In June 2017, we reincorporated from Nevada to Delaware, and changed our name from “Lion Biotechnologies, Inc.” to “Iovance Biotherapeutics, Inc.” --- Our principal executive offices are located at 999 Skyway Road, Suite 150, San Carlos, California 94070, and our telephone number is (650) 260-7120. Our website: www.iovance.com.
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