Ane­mia spe­cial­ist Ake­bia merges with Keryx on the eve of a block­buster brawl with Fi­bro­Gen

Ake­bia is go­ing in­to its head-to-head late-stage fight with Fi­bro­Gen with a lit­tle more fire­pow­er.

Two months af­ter Keryx $KERX CEO Gre­go­ry Madi­son abrupt­ly re­signed and left the com­pa­ny, the biotech has fol­lowed through to­day by agree­ing to a merg­er with Ake­bia $AK­BA, a biotech with a close­ly-watched ane­mia drug in late-stage de­vel­op­ment.

John But­ler

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The com­bi­na­tion of the two com­pa­nies will bring to­geth­er two drugs de­signed for pa­tients with chron­ic kid­ney dis­ease. Keryx mar­kets Au­ryx­ia, which ac­count­ed for the li­on’s share of about $22 mil­lion in Q1 rev­enue. That drug is used to fight iron de­fi­cien­cy ane­mia in pa­tients with chron­ic kid­ney dis­ease.

The deal didn’t add up for in­vestors, though. Both biotechs’ shares were down about 25% in mid-day trad­ing.

That down­turn may have had some­thing to do with Ake­bia’s up­date on its de­vel­op­ment time­line, with cru­cial da­ta now not ex­pect­ed un­til 2020. In the view of Jef­feries’ Michael Yee (in Fi­bro­Gen’s camp):

AK­BA has de­layed the Phase III da­ta to 2020, putting the merged com­pa­ny 1-2 years be­hind FGEN, in our view.

Ake­bia, mean­while, has been lin­ing up a slate of glob­al part­ner­ships in an­tic­i­pa­tion of even­tu­al­ly mar­ket­ing vadadu­s­tat to treat ane­mia in CKD pa­tients. But an­a­lysts ex­pect they’ll have a bat­tle on their hands, with many giv­ing the ad­van­tage to Fi­bro­Gen, which start­ed the day with a mar­ket cap 10 times what Ake­bia had.

Greg Madi­son

Just a few weeks ago Fi­bro­Gen and its part­ners at Astel­las re­port­ed that their 4th Phase III study of the ri­val rox­adu­s­tat in Japan had end­ed with pos­i­tive re­sults. And Fi­bro­Gen is well in­to Phase III in the US as well.

Keryx and Ake­bia, mean­while, say that af­ter the merg­er the biotech should be worth $1.3 bil­lion. Keryx share­hold­ers will wind up with a slight ma­jor­i­ty of the new shares while Ake­bia CEO John But­ler will stay at the helm. Keryx will name the chair­man and the com­pa­ny will be called Ake­bia.

All that prob­a­bly ex­plains a lot about Madi­son’s de­par­ture.

But­ler ex­plained his strat­e­gy:

The strate­gic and fi­nan­cial dri­vers of this merg­er are com­pelling. The com­bined com­pa­ny will have an ex­pand­ed and high­ly com­ple­men­tary nephrol­o­gy port­fo­lio, with Au­ryx­ia, a prod­uct with sig­nif­i­cant growth op­por­tu­ni­ty, and vadadu­s­tat, an in­ves­ti­ga­tion­al late-stage HIF-PHI that has the po­ten­tial to pro­vide a new oral stan­dard of care to pa­tients with ane­mia due to CKD. Com­bin­ing Ake­bia and Keryx cre­ates a lead­ing re­nal com­pa­ny and pro­vides it with the in­fra­struc­ture to max­i­mize the mar­ket po­ten­tial of Au­ryx­ia and build launch mo­men­tum for vadadu­s­tat in the Unit­ed States, sub­ject to FDA ap­proval.

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His­toric drug pric­ing re­forms pass; Pfiz­er ac­quires GBT; The long search for non-opi­oid pain drugs; and more

Welcome back to Endpoints Weekly, your review of the week’s top biopharma headlines. Want this in your inbox every Saturday morning? Current Endpoints readers can visit their reader profile to add Endpoints Weekly. New to Endpoints? Sign up here.

The Endpoints Weekly has officially crossed the 60,000 mark on subscribers — thanks to all of your support. As the editorial team grows, we’ve been able to do a lot more, with many of those on display this week. Be sure to check out Lei Lei Wu’s deep dive on pain R&D. If you missed it, you may also rewatch her companion panel here.

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Gold for adults, sil­ver for in­fants: Pfiz­er's Pre­vnar 2.0 head­ed to FDA months af­ter Mer­ck­'s green light

Pfizer was first to the finish line for the next-gen pneumococcal vaccine in adults, but Merck beat its rival with a jab for children in June.

Now, two months after Merck’s 15-valent Vaxneuvance won the FDA stamp of approval for kids, Pfizer is out with some late-stage data on its 20-valent shot for infants.

Known as Prevnar 20 for adults, Pfizer’s 20vPnC will head to the FDA by the end of this year for an approval request in infants, the Big Pharma said Friday morning. Discussions with the FDA will occur first and more late-stage pediatric trials are expected to read out soon, informing the regulatory pathway in other countries and regions.

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Seagen interim CEO Roger Dansey and Daiichi Sankyo CEO Sunao Manabe

Paving the way for Mer­ck­'s buy­out, Seagen los­es ar­bi­tra­tion dis­pute with Dai­ichi over ADC tech

As Seagen awaits a final buyout offer from Merck that could be in the territory of $40 billion, Seagen revealed Friday afternoon that it lost an arbitration dispute with Daiichi Sankyo relating to the companies’ 2008 collaboration around the use of antibody-drug conjugate (ADC) technology.

But that loss likely won’t matter much when it comes to Merck’s deal.

After breaking off its pact with Daiichi in mid-2015, the two companies battled over “linker” tech — a chemical bridge between an ADC’s antibody component and the cytotoxic payload — that Seagen claims Daiichi would improve upon and implement in its current generation of ADCs.

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Alessandro Maselli, Catalent CEO

Catal­ent ac­quires North Car­oli­na CD­MO for $475M, boost­ing oral solids work

As Catalent has been expanding its reach in the US this year, as well as recently completing a C-suite shuffle, the company announced last night that it has acquired the CDMO Metrics Contract Services for $475 million from Mayne Pharma Group.

The acquisition will increase Catalent’s capabilities in oral solid formulation development, manufacturing and packaging as well as expand its capacity to handle more highly potent compounds.

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House pass­es his­toric drug pric­ing re­forms, lin­ing up decades-in-the-mak­ing win for Biden and De­moc­rats

The US House of Representatives today voted along party lines (all Dems voted for it), 220-207 to pass new, wide-ranging legislation that will allow Medicare drug price negotiations for the first time ever, and cap seniors’ drug expenses to $2,000 per year and seniors’ insulin costs at $35 per month.

Setting up a major victory for President Joe Biden, representatives returned from their summer recess to pass the Inflation Reduction Act, even as many noted the bill would only modestly reduce inflation.

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Senate Finance Committee Chair Ron Wyden (D-OR) (Francis Chung/E&E News/POLITICO via AP Images)

Sen­ate Fi­nance chair con­tin­ues his in­ves­ti­ga­tion in­to phar­ma tax­es with re­quests for Am­gen

Amgen is the latest pharma company to appear on the radar of Senate Finance Committee Chair Ron Wyden (D-OR), who is investigating the way pharma companies are using subsidiaries in low- or zero-tax countries to lower their tax bills.

Like its peers Merck, AbbVie and Bristol Myers Squibb, Wyden notes how Amgen uses its Puerto Rico operations to consistently pay tax rates that are substantially lower than the U.S. corporate tax rate of 21%, with an effective tax rate of 10.7% in 2020 and 12.1% in 2021.

FDA ap­proves sec­ond in­di­ca­tion for As­traZeneca and Dai­ichi's En­her­tu in less than a week

AstraZeneca and Daiichi Sankyo’s antibody-drug conjugate Enhertu scored its second approval in less than a week, this time for a subset of lung cancer patients.

Enhertu received accelerated approval on Thursday to treat adults with unresectable or metastatic non-small cell lung cancer (NSCLC) whose tumors have activating HER2 (ERBB2) mutations, and who have already received a prior systemic therapy.

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J&J to re­move talc prod­ucts from shelves world­wide, re­plac­ing with corn­starch-based port­fo­lio

After controversially spinning out its talc liabilities and filing for bankruptcy in an attempt to settle 38,000 lawsuits, Johnson & Johnson is now changing up the formula for its baby powder products.

J&J is beginning the transition to an all cornstarch-based baby powder portfolio, the pharma giant announced on Thursday — just months after a federal judge ruled in favor of its “Texas two-step” bankruptcy to settle allegations that its talc products contained asbestos and caused cancer. An appeals court has since agreed to revisit that case.