A tale of two IPOs (plus one): Ca­balet­ta prices well be­low range for $75M while Phath­om bags $182M

When Ca­balet­ta Bio and Phath­om Phar­ma­ceu­ti­cals pen­ciled in $100 mil­lion IPOs along­side 4D Mol­e­c­u­lar Ther­a­peu­tics back in the be­gin­ning of Oc­to­ber, they ap­peared to be rid­ing on a wave of pos­i­tive sen­ti­ments in the pub­lic mar­kets — al­beit against some chat­ter in the back­ground about how long the buoy­ant con­di­tions will last.

The an­swers turned out to be dif­fer­ent for each of these biotechs. Late Thurs­day, Ca­balet­ta, a Uni­ver­si­ty of Penn­syl­va­nia spin­out, raised $75 mil­lion de­spite up­siz­ing its of­fer­ing to 6.8 mil­lion shares, while Phath­om’s gross pro­ceeds from sell­ing more than 9.6 mil­lion shares reg­is­tered at $182 mil­lion.

The un­der­whelm­ing de­buts of sev­er­al biotech uni­corns have un­der­scored the un­cer­tain­ty cloud­ing re­cent list­ings, from BioN­Tech rais­ing about $100 mil­lion less than orig­i­nal­ly in­tend­ed to Vir pric­ing at the low end of the range. Be­fore that, ADC Ther­a­peu­tics pulled out its plans en­tire­ly cit­ing ad­verse cir­cum­stances.

But Ca­balet­ta’s case could seem even more se­ri­ous. Af­ter set­ting terms in the $14 to $16 range, it end­ed up pric­ing at $11.

Its pitch cen­tered around CAAR-Ts — chimeric au­toan­ti­body re­cep­tors — pro­nounced “dou­ble-A CAR-T” and their po­ten­tial to take out path­o­gen­ic B cells while spar­ing healthy ones. That tech, be­ing steered to the clin­ic by a star-stud­ded team of founders and ex­ecs, had won the com­pa­ny $88 mil­lion in pri­vate fund­ing from 5AM Ven­tures, Adage Cap­i­tal, Bak­er Bros, Box­er Cap­i­tal and Deer­field.

Its first clin­i­cal tri­al is ex­pect­ed to be­gin in 2020, tar­get­ing a rare skin dis­or­der called mu­cos­al pem­phi­gus vul­garis.

Mean­while Phath­om’s launch price of $19 was in the mid­dle of its range of $18 to $20, gain­ing more fire­pow­er to com­plete Phase III tri­als for vono­prazan, a drug that blocks the potas­si­um-bind­ing site of gas­tric hy­dro­gen potas­si­um AT­Pase (al­so known as the pro­ton pump), which is the en­zyme large­ly re­spon­si­ble for acid­i­fi­ca­tion of the stom­ach. Al­ready ap­proved in Japan, it is be­ing test­ed for ero­sive esophagi­tis and H. py­lori in­fec­tion.

The pro­ceeds will al­so pro­pel a gas­troin­testi­nal pipeline from Take­da, a process that Fra­zier played a cru­cial role in.

TFF Phar­ma’s pub­lic list­ing comes across as much more straight­for­ward as the Austin-based lung dis­ease biotech set the price at $5 when it filed for the $22 mil­lion IPO in Au­gust. Led by Glenn Mattes, the com­pa­ny is de­vel­op­ing dry pow­der in­haler ver­sions of pul­monary drugs gen­er­at­ed with its name­sake Thin Film Freez­ing tech­nol­o­gy.

A New Fron­tier: The In­ner Ear

What happens when a successful biotech venture capitalist is unexpectedly diagnosed with a chronic, life-disrupting vertigo disorder? Innovation in neurotology.

That venture capitalist was Jay Lichter, Ph.D., and after learning there was no FDA-approved drug treatment for his condition, Ménière’s disease, he decided to create a company to bring drug development to neurotology. Otonomy was founded in 2008 and is dedicated to finding new drug treatments for the hugely underserved community living with balance and hearing disorders. Helping patients like Jay has been the driving force behind Otonomy, a company heading into a transformative 2020 with three clinical trial readouts: Phase 3 in Ménière’s disease, Phase 2 in tinnitus, and Phase 1/2 in hearing loss. These catalysts, together with others in the field, highlight the emerging opportunity in neurotology.
Otonomy is leading the way in neurotology
Neurotology, or the treatment of inner ear neurological disorders, is a large and untapped market for drug developers: one in eight individuals in the U.S. have moderate-to-severe hearing loss, tinnitus or vertigo disorders such as Ménière’s disease.1 With no FDA-approved drug treatments available for these conditions, the burden on patients—including social anxiety, lower quality of life, reduced work productivity, and higher rates of depression—can be significant.2, 3, 4

Joe Jimenez, Getty

Ex-No­var­tis CEO Joe Jimenez is tak­ing an­oth­er crack at open­ing a new chap­ter in his ca­reer — and that in­cludes a new board seat and a $250M start­up

Joe Jimenez is back.

The ex-CEO of Novartis has taken a board seat on Century Therapeutics, the Versant and Bayer-backed startup focused on coming up with a brand new twist on cell therapies for cancer — a field where Jimenez made his mark backing the first personalized CAR-T approved for use.

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Can we make the an­tibi­ot­ic mar­ket great again?

The standard for-profit model in drug development is straightforward. Spend millions, even billions, to develop a medicine from scratch. The return on investment (and ideally a tidy profit) comes via volume and/or price, depending on the disease. But the string of big pharma exits and slew of biotech bankruptcies indicate that the model is sorely flawed when it comes to antibiotics.

The industry players contributing to the arsenal of antimicrobials are fast dwindling, and the pipeline for new antibiotics is embarrassingly sparse, the WHO has warned. Drugmakers are enticed by greener pastures, compared to the long, arduous and expensive path to antibiotic approval that offers little financial gain as treatments are typically priced cheaply, and often lose potency over time as microbes grow resistant to them.

The FTC and New York state ac­cuse Mar­tin Shkre­li of run­ning a drug mo­nop­oly. They plan to squash it — and per­ma­nent­ly ex­ile him

Pharma bro Martin Shkreli was jailed, publicly pilloried and forced to confront some lawmakers in Washington riled by his move to take an old generic and move the price from $17.50 per pill to $750. But through 4 years of controversy and public revulsion, his company never backed away from the price — left uncontrolled by a laissez faire federal policy on a drug’s cost.

Now the FTC and the state of New York plan to pry his fingers off the drug once and for all and open it up to some cheap competition. And their lawsuit is asking that Shkreli — with several years left on his prison sentence — be banned permanently from the pharma industry.

Amber Saltzman (Ohana)

Flag­ship's first ven­ture of 2020 is out, and it's all about sperm

A couple years ago, Amber Salzman got a call as she was returning East full-time after a two-year stint running a gene therapy company in California.

It was from someone at Flagship Pioneering, the deep-pocketed biotech venture firm. They had a new company with a new way of thinking about sperm. It had been incubating for over a year, and now they wanted her to run it.

“It exactly fit,” Salzman told Endpoints News. “I just thought I had to do something.”

Pfiz­er ax­es 6 ear­ly to late-stage can­cer stud­ies from the pipeline — with one oth­er cut for sick­le cell dis­ease

Pfizer trimmed a group of 3 R&D programs using their PD-L1 Bavencio — partnered with Merck KGaA — in their latest pipeline cull.

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UP­DAT­ED: In­cyte scores much need­ed PhI­II suc­cess — and of course it’s de­liv­ered by rux­oli­tinib

Incyte’s efforts to breathe a second life into ruxolitinib — its JAK inhibitor sold in pill form as Jakafi — has been greeted with clear, if preliminary and unsurprising, Phase III success.

Topline data from the TRuE-AD2 cements ruxolitinib’s foundational importance for Incyte, and gives analysts hope that there might yet be room for growth in a pipeline that’s suffered multiple R&D setbacks.

Stephen Hahn, AP

The FDA un­veils a new reg­u­la­to­ry frame­work to speed along gene ther­a­pies, re­ward­ing the lead­ing play­ers

Bioregnum Opinion Column by John Carroll

The emphasis at the FDA over the past 5 years or so has been on assisting drug developers as much as they can to speed up regulatory reviews and push more drugs into the market. And they are now crafting a final set of regulations aimed at flagging through a whole new generation of gene therapies in clinical testing at a rapid clip.

In a set of 6 prospective guidances posted on the FDA web site Tuesday morning, FDA commissioner Stephen Hahn committed the agency to staying flexible in handing out designations that are critical to gaining early approvals for drugs that claim to be once-and-done but don’t have anything close to the data needed to prove it.

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Mike Bloomberg (AP IMAGES)

Mike Bloomberg joins a grow­ing cho­rus of De­mo­c­ra­t­ic pres­i­den­tial can­di­dates threat­en­ing to go af­ter drug patents

As the mayor of New York City, Mike Bloomberg had a few modest ideas about lowering prescription drug prices in the Big Apple that gained little traction. Now on the campaign trail on a faint hope of clinching the Democratic presidential nomination, the billionaire has some bigger plans — including one that would alter the patent system central to the biopharma business.

In a barebones drug pricing plan posted on Monday, Bloomberg came out blasting President Donald Trump for failing to deliver his promise to lower drug prices, and then making misleading claims about them. The price of over 3,000 drugs still increased at a rate five times higher than inflation in the first six months of 2019, he wrote.