UP­DAT­ED: An­oth­er big CRO deal has land­ed as Ther­mo Fish­er ac­quires PPD for $17.4B

Con­sol­i­da­tion among big CRO play­ers is con­tin­u­ing to churn.

Fol­low­ing a Wednes­day af­ter­noon re­port from the Wall Street Jour­nal say­ing a deal was close, Ther­mo Fish­er has an­nounced plans to ac­quire PPD for $17.4 bil­lion. WSJ had re­port­ed that the par­ties could wrap up an agree­ment as soon as this week. It’s the sec­ond CRO M&A deal in as many months, fol­low­ing the Icon-PRA Health Sci­ences deal in late Feb­ru­ary.

Thurs­day morn­ing, Ther­mo Fish­er an­nounced the trans­ac­tion would ac­count for $17.4 bil­lion in cash plus an as­sump­tion of about $3.5 bil­lion in net debt. That to­tal rep­re­sents a per share price of $47.50, good for a 24% pre­mi­um on PPD’s clos­ing price from Tues­day af­ter­noon.

In a state­ment, Ther­mo Fish­er CEO Marc Casper said:

Phar­ma and Biotech is our largest and fastest grow­ing end mar­ket, and our cus­tomers val­ue us as a strate­gic part­ner and an in­dus­try leader. The ac­qui­si­tion of PPD is a nat­ur­al ex­ten­sion for Ther­mo Fish­er and will en­able us to pro­vide these cus­tomers with im­por­tant clin­i­cal re­search ser­vices and part­ner with them in new and ex­cit­ing ways as they move a sci­en­tif­ic idea to an ap­proved med­i­cine quick­ly, re­li­ably and cost ef­fec­tive­ly. Longer term, we plan to con­tin­ue to in­vest in and con­nect the ca­pa­bil­i­ties across the com­bined com­pa­ny to fur­ther help our cus­tomers ac­cel­er­ate in­no­va­tion and dri­ve pro­duc­tiv­i­ty, while dri­ving fur­ther val­ue for our share­hold­ers.

In the wake of WSJ’s re­port, PPD $PPD shares rose 12% be­fore the mar­ket closed Wednes­day af­ter­noon, and it was up an­oth­er 3% af­ter hours. Ther­mo Fish­er’s stock $TMO had large­ly been down for the day and closed down 1.4%.

As part of the merg­er there were lots of cost “syn­er­gies” that Ther­mo Fish­er plans to re­al­ize — like­ly re­sult­ing in sig­nif­i­cant cuts over the next three years. Ther­mo Fish­er said it plans to save $75 mil­lion over that time pe­ri­od from cuts. They al­so ex­pect an ad­di­tion­al $50 mil­lion in “rev­enue-re­lat­ed syn­er­gies.”

Ther­mo Fish­er is hard­ly new to these types of deals, com­ing a long way from its start as an R&D in­stru­ments and ma­te­ri­als com­pa­ny sell­ing things like lab equip­ment. Back in 2017, Ther­mo Fish­er bought Patheon — a ma­jor con­tract man­u­fac­tur­er — to start pro­vid­ing clin­i­cal tri­al ser­vices and lo­gis­tics.

Then last month, the com­pa­ny dropped $600 mil­lion to shore up its man­u­fac­tur­ing sup­ply chain in the wake of a sharp rise in Covid-19 work. Funds were di­rect­ed to­ward its short-term Covid-19 projects and more than dou­ble its ca­pac­i­ty for the fu­ture.

Though tak­en pri­vate about a decade ago, PPD went pub­lic again in Feb­ru­ary 2020 in a $1.62 bil­lion IPO that at the time was the largest of the year. The com­pa­ny had been look­ing to cap­i­tal­ize not on­ly on an in­crease in out­sourc­ing and R&D spend­ing, but growth in the biotech sec­tor as a whole.

Most of the IPO funds went to­ward re­deem­ing bonds, which were is­sued in a re­cap­i­tal­iza­tion project en­gi­neered by its biggest pri­vate eq­ui­ty back­ers in 2017, its S-1 said. In ad­di­tion to its role as a CRO, PPD al­so of­fers lab­o­ra­to­ry ser­vices.

Con­tract re­search M&A had seen sig­nif­i­cant moves sev­er­al years ago, but large­ly cooled off in the years lead­ing up to the pan­dem­ic. That all changed in Feb­ru­ary with the Icon-PRA deal, a merg­er that com­bined the 5th- and 6th-largest CROs by 2020 rev­enue to cre­ate the 2nd-biggest CRO. The cash and stock deal to­taled rough­ly $12 bil­lion.

Pi­o­neer­ing Click Chem­istry in Hu­mans

Reimagining cancer treatments

Cancer is a leading cause of death worldwide, accounting for nearly 10 million deaths in 2020, which is nearly one in six deaths. Recently, we have seen incredible advances in novel cancer therapies such as immune checkpoint inhibitors, cell therapies, and antibody-drug conjugates that have revamped cancer care and improved survival rates for patients.

Despite this significant progress in therapeutic targeting, why are we still seeing such a high mortality rate? The reason is that promising therapies are often limited by their therapeutic index, which is a measure of the effective dose of a drug, relative to its safety. If we could broaden the therapeutic indices of currently available medicines, it would revolutionize cancer treatments. We are still on the quest to find the ultimate cancer medicine – highly effective in several cancer types, safe, and precisely targeted to the tumor site.

Justin Klee (L) and Joshua Cohen, Amylyx co-CEOs (Cody O'Loughlin/The New York Times; courtesy Amylyx)

Ad­vo­cates, ex­perts cry foul over Amy­lyx's new ALS drug, cit­ing is­sues with price, PhI­II com­mit­ment

Not 24 hours after earning the first ALS drug approval in five years, Amylyx Pharmaceuticals’ Relyvrio is already drawing scrutiny. And it’s coming from multiple fronts.

In an investor call Friday morning, Amylyx revealed that it would charge about $158,000 per year, a price point that immediately drew backlash from ALS advocates and some outside observers. The cost reveal had been highly anticipated in the immediate hours after Thursday evening’s approval, though Amylyx only teased Relyvrio would cost less than previously approved drugs.

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Land­mark Amy­lyx OK spurs de­bate; Some... pos­i­tive? Alzheimer's da­ta; Can­cer tri­al bot­tle­neck; Sanofi's CRISPR bet; 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.

After brief stops in Paris and Boston, John Carroll and the Endpoints crew are staying on the road in October with their return for a live/streaming EUBIO22 in London. The hybrid event fireside chats and panels on mRNA, oncology and the crazy public market. We hope you can join him there.

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Joshua Cohen (L) and Justin Klee, Amylyx co-CEOs

Up­dat­ed: Af­ter long and wind­ing road, FDA ap­proves Amy­lyx's ALS drug in vic­to­ry for pa­tients and ad­vo­ca­cy groups

For just the third time in its 116-year history, the FDA has approved a new treatment for Lou Gehrig’s disease, or ALS.

US regulators gave the thumbs-up to the drug, known as Relyvrio, in a massive win for patients and their families. The approval, given to Boston-area biotech Amylyx Pharmaceuticals, comes after two years of long and contentious debates over the drug’s effectiveness between advocacy groups and FDA scientists, following the readout of a mid-stage clinical trial in September 2020.

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Bo Cumbo, new Solid Bio CEO

Sol­id Bio gets a new CEO, $75M cash and drops lead drug as big in­vestors ju­ry-rig a merg­er deal

Three months after Endpoints News broke the story that gene therapy outfit AavantiBio had gutted its CMC group in a reorganization, the biotech’s CEO has helped engineer a merger with struggling penny stock player Solid Bio. And he’s going to remain in charge of the combined operation, as Solid founder Ilan Ganot steps aside.

The merger news this morning features some high-profile investors.

Perceptive Advisors, RA Capital Management and Bain Capital Life Sciences are leading a $75 million raise to add to the pool of cash Solid will have after the tie-up. That will leave Solid $215 million in cash as Bain’s Adam Koppel jumps on the board — enough to pay for ops and get through some key data milestones on their way into 2025.

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Up­dat­ed: Al­ny­lam re­in­forces APOL­LO-B patisir­an da­ta be­fore head­ing to the FDA

Weeks after uncorking some mostly positive data for patisiran in transthyretin-mediated (ATTR) amyloidosis with cardiomyopathy, Alnylam is bolstering its package with new exploratory and subgroup data before shipping it off to regulators.

The RNAi drug maintained “generally consistent” benefits in efficacy and quality of life across several prespecified subgroups at month 12, Alnylam announced on Friday afternoon, including age, baseline tafamidis use, ATTR amyloidosis type, baseline six-minute walk test score and others.

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Nooman Haque, head of life sciences and healthcare at Silicon Valley Bank, and John Carroll

I’m head­ed to Lon­don soon for #EU­BIO22. Care to join me?

It was great getting back to a live ESMO conference/webinar in Paris followed by a live pop-up event for the Endpoints 11 in Boston. We’re staying on the road in October with our return for a live/streaming EUBIO22 in London.

Silicon Valley Bank’s Nooman Haque and I are once again jumping back into the thick of it with a slate of virtual and live events on October 12. I’ll get the ball rolling with a virtual fireside chat with Novo Nordisk R&D chief Marcus Schindler, covering their pipeline plans and BD work.

#AAO22: J&J’s first look at com­mon eye dis­ease port­fo­lio pads the case for PhII of gene ther­a­py

CHICAGO — While the later-stage drug developers in the geographic atrophy field are near the finish line, Johnson & Johnson’s Janssen is taking a more deliberate route, with a treatment that it hopes to be a one-time fix.

The Big Pharma will take its Hemera Biosciences-acquired gene therapy into a Phase II study later this year in patients with GA, a common form of age-related macular degeneration that impacts about five million people worldwide. To get there, Janssen touted early-stage safety data at the American Academy of Ophthalmology annual conference Saturday morning, half a day after competitors Apellis and Iveric Bio revealed their own more-detailed Phase III analyses.

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Jerome Durso, Intercept Pharmaceuticals CEO

In­ter­cep­t's OCA fails a PhI­II NASH tri­al, rais­ing fresh doubts about its years­long quest for an OK

Intercept Pharmaceuticals has run into another big setback in its yearslong quest to win an approval for OCA in NASH. The biotech put out word Friday morning that its Phase III REVERSE study failed the primary endpoint for the liver disease, sending its share price into a tailspin.

There was no significant improvement in fibrosis among the patients suffering from cirrhosis who were treated with obeticholic acid, with investigators hunting for a minimum 1-stage histological improvement in the disease after 18 months of therapy.

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