A few key rea­sons why Bio­gen has now be­come a buzzed about takeover tar­get

Strug­gling with rev­enue and keep­ing in­vestors’ in­ter­est in its pipeline as its CEO heads for the ex­its, Bio­gen has drawn some in­ter­est from two big play­ers about a pos­si­ble takeover. The Wall Street Jour­nal re­port­ed Tues­day af­ter­noon that Al­ler­gan and Mer­ck have both made over­tures to Bio­gen to sound out their in­ter­est in a deal.

Bio­gen’s shares $BI­IB raced up 9%, adding bil­lions in mar­ket cap as the in­vest­ment com­mu­ni­ty looked to jump in­to a pos­si­ble deal in the mak­ing. But by ear­ly Tues­day evening CN­BC was fol­low­ing up with a re­port that Al­ler­gan, which may have had a hard time mak­ing a buy­out work un­der cur­rent tax rules, was un­like­ly to fol­low up.

The Jour­nal piece made it clear that there’s no bid on the ta­ble and may not be one. The over­tures were “in­for­mal and pre­lim­i­nary,” its re­port­ing team not­ed, not sig­ni­fy­ing much in­ter­est in a hos­tile move if nec­es­sary.

CEO George Scan­gos

The ru­mors come just days af­ter Bio­gen CEO George Scan­gos an­nounced plans to ex­it the com­pa­ny, plan­ning to hand over the reins to a new ex­ec­u­tive ready to tack­le the next phase. Scan­gos him­self has down­played any talk of a po­ten­tial takeover, and an­a­lysts have won­dered why he would be leav­ing if the com­pa­ny was about to go in­to an auc­tion, with big po­ten­tial pay­offs for the top team.

In many ways, Bio­gen would make a tempt­ing ac­qui­si­tion, with a mar­ket cap now sit­ting at about $75 bil­lion. It has sev­er­al fran­chise drugs on the mar­ket and a few close­ly-watched pro­grams in the clin­ic, in­clud­ing a new late-stage pro­gram part­nered with Io­n­is that just cleared a Phase III study for spinal mus­cu­lar at­ro­phy. But on­ly a hand­ful of play­ers in the in­dus­try could pull off a deal that size.

Com­pli­cat­ing any buy­out, Bio­gen’s R&D group has made a ma­jor in­vest­ment in fields like Alzheimer’s, where its drug ad­u­canum­ab rep­re­sents an­oth­er big swing at a po­ten­tial­ly enor­mous mar­ket. But it’s in the high­est risk are­na in biotech, mak­ing a val­u­a­tion dev­il­ish­ly hard to reach with­out a de­vice like a CVR, pay­ing off on mile­stones.

Bio­gen’s prob­lem, and the rea­son why it’s vul­ner­a­ble now, is that Scan­gos and his team sad­dled the com­pa­ny with an ul­tra high risk pipeline with few near-term cat­a­lysts able to whet Wall Street’s ap­petite as its Tec­fidera fran­chise fades. That forced the com­pa­ny to ex­e­cute a ma­jor re­or­ga­ni­za­tion last year to cut costs. And a re­cent set­back in its lat­est at­tempt to come up with a new drug that could po­ten­tial­ly re­verse the ef­fects of mul­ti­ple scle­ro­sis sim­ply high­light­ed the fix it is in now.

For many an­a­lysts, that weak­ened po­si­tion made it all the more like­ly that Bio­gen would have to pull off sev­er­al big deals of its own to re­plen­ish the pipeline. In the words of Baird’s Bri­an Sko­r­ney: “We think it’s time for Bio­gen to buy or be bought.”

Al­ler­gan is run by Brent Saud­ers, a deal-mak­ing CEO who just land­ed a big pay­off now that the Te­va gener­ics deal has gone through. And while Mer­ck has its new check­point drug Keytru­da to boast about, it al­so has plen­ty of rea­sons to find val­ue in a com­pa­ny like Bio­gen.

Every­one loves a ru­mored buy­out deal, so ex­pect lots of smoke as every­one tries to fig­ure out if there’s any fire at Bio­gen.

Fangliang Zhang, AP Images

UP­DAT­ED: Leg­end fetch­es $424 mil­lion, emerges as biggest win­ner yet in pan­dem­ic IPO boom as shares soar

Amid a flurry of splashy pandemic IPOs, a J&J-partnered Chinese biotech has emerged with one of the largest public raises in biotech history.

Legend Biotech, the Nanjing-based CAR-T developer, has raised $424 million on NASDAQ. The biotech had originally filed for a still-hefty $350 million, based on a range of $18-$20, but managed to fetch $23 per share, allowing them to well-eclipse the massive raises from companies like Allogene, Juno, Galapagos, though they’ll still fall a few dollars short of Moderna’s record-setting $600 million raise from 2018.

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As it hap­pened: A bid­ding war for an an­tibi­ot­ic mak­er in a mar­ket that has rav­aged its peers

In a bewildering twist to the long-suffering market for antibiotics — there has actually been a bidding war for an antibiotic company: Tetraphase.

It all started back in March, when the maker of Xerava (an FDA approved therapy for complicated intra-abdominal infections) said it had received an offer from AcelRx for an all-stock deal valued at $14.4 million.

The offer was well-timed. Xerava was approved in 2018, four years after Tetraphase posted its first batch of pivotal trial data, and sales were nowhere near where they needed to be in order for the company to keep its head above water.

Is a pow­er­house Mer­ck team prepar­ing to leap past Roche — and leave Gilead and Bris­tol My­ers be­hind — in the race to TIG­IT dom­i­na­tion?

Roche caused quite a stir at ASCO with its first look at some positive — but not so impressive — data for their combination of Tecentriq with their anti-TIGIT drug tiragolumab. But some analysts believe that Merck is positioned to make a bid — soon — for the lead in the race to a second-wave combo immuno-oncology approach with its own ambitious early-stage program tied to a dominant Keytruda.

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Drug man­u­fac­tur­ing gi­ant Lon­za taps Roche/phar­ma ‘rein­ven­tion’ vet as its new CEO

Lonza chairman Albert Baehny took his time headhunting a new CEO for the company, making it absolutely clear he wanted a Big Pharma or biotech CEO with a good long track record in the business for the top spot. In the end, he went with the gold standard, turning to Roche’s ranks to recruit Pierre-Alain Ruffieux for the job.

Ruffieux, a member of the pharma leadership team at Roche, spent close to 5 years at the company. But like a small army of manufacturing execs, he gained much of his experience at the other Big Pharma in Basel, remaining at Novartis for 12 years before expanding his horizons.

Leen Kawas, Athira CEO (Athira)

Can a small biotech suc­cess­ful­ly tack­le an Ever­est climb like Alzheimer’s? Athi­ra has $85M and some in­flu­en­tial back­ers ready to give it a shot

There haven’t been a lot of big venture rounds for biotech companies looking to run a Phase II study in Alzheimer’s.

The field has been a disaster over the past decade. Amyloid didn’t pan out as a target — going down in a litany of Phase III failures — and is now making its last stand at Biogen. Tau is a comer, but when you look around and all you see is destruction, the idea of backing a startup trying to find complex cocktails to swing the course of this devilishly complicated memory-wasting disease would daunt the pluckiest investors.

GSK presents case to ex­pand use of its lu­pus drug in pa­tients with kid­ney dis­ease, but the field is evolv­ing. How long will the mo­nop­oly last?

In 2011, GlaxoSmithKline’s Benlysta became the first biologic to win approval for lupus patients. Nine years on, the British drugmaker has unveiled detailed positive results from a study testing the drug in lupus patients with associated kidney disease — a post-marketing requirement from the initial FDA approval.

Lupus is a drug developer’s nightmare. In the last six decades, there has been just one FDA approval (Benlysta), with the field resembling a graveyard in recent years with a string of failures including UCB and Biogen’s late-stage flop, as well as defeats in Xencor and Sanofi’s programs. One of the main reasons the success has eluded researchers is because lupus, akin to cancer, is not just one disease — it really is a disease of many diseases, noted Al Roy, executive director of Lupus Clinical Investigators Network, an initiative of New York-based Lupus Research Alliance that claims it is the world’s leading private funder of lupus research, in an interview.

Covid-19 roundup: Ab­b­Vie jumps in­to Covid-19 an­ti­body hunt; As­traZeneca shoots for 2B dos­es of Ox­ford vac­cine — with $750M from CEPI, Gavi

Another Big Pharma is entering the Covid-19 antibody hunt.

AbbVie has announced a collaboration with the Netherlands’ Utrecht University and Erasmus Medical Center and the Chinese-Dutch biotech Harbour Biomed to develop a neutralizing antibody that can treat Covid-19. The antibody, called 47D11, was discovered by AbbVie’s three partners, and AbbVie will support early preclinical work, while preparing for later preclinical and clinical development. Researchers described the antibody in Nature Communications last month.

President Donald Trump (left) and Moncef Slaoui, head of Operation Warp Speed (Alex Brandon, AP Images)

UP­DAT­ED: White House names fi­nal­ists for Op­er­a­tion Warp Speed — with 5 ex­pect­ed names and one no­table omis­sion

A month after word first broke of the Trump Administration’s plan to rapidly accelerate the development and production of a Covid-19 vaccine, the White House has selected the five vaccine candidates they consider most likely to succeed, The New York Times reported.

Most of the names in the plan, known as Operation Warp Speed, will come as little surprise to those who have watched the last four months of vaccine developments: Moderna, which was the first vaccine to reach humans and is now the furthest along of any US effort; J&J, which has not gone into trials but received around $500 million in funding from BARDA earlier this year; the joint AstraZeneca-Oxford venture which was granted $1.2 billion from BARDA two weeks ago; Pfizer, which has been working with the mRNA biotech BioNTech; and Merck, which just entered the race and expects to put their two vaccine candidates into humans later this year.

Pfiz­er’s Doug Gior­dano has $500M — and some ad­vice — to of­fer a cer­tain breed of 'break­through' biotech

So let’s say you’re running a cutting-edge, clinical-stage biotech, probably public, but not necessarily so, which could see some big advantages teaming up with some marquee researchers, picking up say $50 million to $75 million dollars in a non-threatening minority equity investment that could take you to the next level.

Doug Giordano might have some thoughts on how that could work out.

The SVP of business development at the pharma giant has helped forge a new fund called the Pfizer Breakthrough Growth Initiative. And he has $500 million of Pfizer’s money to put behind 7 to 10 — or so — biotech stocks that fit that general description.

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