An­ti­fun­gal out, can­cer in: Rev­o­lu­tion scores $500M Sanofi deal on first on­col­o­gy pro­gram

Less than a year ago, Third Rock start­up Rev­o­lu­tion Med­i­cines shed its an­ti­fun­gal am­bi­tions and re­made it­self as an on­col­o­gy com­pa­ny. Now, the Red­wood City-based biotech has ap­par­ent­ly wooed Sanofi $SNY in­to a bang up deal on its first can­cer pro­gram.

Mark Gold­smith

The com­pa­ny said Wednes­day that Sanofi will be pick­ing up the check for its lead pro­gram’s R&D, while of­fer­ing a $50 mil­lion up­front pay­ment and up to $500 mil­lion in gat­ed mile­stones. The two com­pa­nies are al­so shar­ing US prof­its (and loss­es) in a 50/50 split — an un­usu­al­ly bal­anced deal for an ear­ly-stage biotech like Rev­o­lu­tion to fi­na­gle.

What’s Rev­o­lu­tion got? Its lead pro­gram is a pre­clin­i­cal-stage small mol­e­cule that might fight can­cer in two sep­a­rate ways. The drug in­hibits SHP2, a cel­lu­lar en­zyme in the pro­tein ty­ro­sine phos­phatase fam­i­ly that plays a key role in sev­er­al types of can­cer. Rev­o­lu­tion’s pres­i­dent and CEO Mark Gold­smith tells me the drug, coined RMC-4630, can both “sup­press cell growth sig­nal­ing and over­come sup­pres­sive ac­tiv­i­ties in the im­mune sys­tem” in cer­tain can­cers. In oth­er words, it has the po­ten­tial to stall — or even shrink — the tu­mor it­self, and al­so neu­tral­ize the im­mune-sup­press­ing en­vi­ron­ment in which the tu­mor thrives.

The lead drug will move in­to hu­man tri­als dur­ing the sec­ond half of this year, Gold­smith says, test­ing the com­pound against non-small cell lung can­cer (NSCLC). When asked if NSCLC was get­ting crowd­ed, Gold­smith em­phat­i­cal­ly de­fend­ed the con­tin­u­ing need for new ther­a­pies in the field.

“There seems to be an emerg­ing view that non-small cell lung can­cer has been tak­en care of with the use of chemo plus check­point in­hibitors, but I be­lieve that’s a vast­ly over­stat­ed pos­ture and a lit­tle re­gret­table,” Gold­smith said. “Lung can­cer re­mains a se­ri­ous scourge in the US with a high fa­tal­i­ty rate and on­ly a sub­set of pa­tients ben­e­fit from the cur­rent tar­get­ed ther­a­pies, chemo, or check­point in­hibitors. Even those pa­tients who do re­ceive tar­get­ed ther­a­py of­ten — and quick­ly — de­vel­op re­sis­tance to the tar­get­ed ther­a­pies.”

But it’s not just NSCLC Rev­o­lu­tion is tak­ing on. The com­pa­ny thinks its tech can al­so tack­le colon can­cer and some melanomas. The Sanofi deal gets the phar­ma gi­ant ex­clu­sive world­wide rights to com­mer­cial­ize any ap­proved prod­ucts tar­get­ing SHP2, al­though there’s a US-on­ly co-pro­mote op­tion writ­ten in for Rev­o­lu­tion.

Rev­o­lu­tion was court­ing suit­ors for months af­ter it no­ti­fied sev­er­al big phar­mas that it was look­ing for part­ners last year. They got to term sheets with a few, but ul­ti­mate­ly were smit­ten with what Sanofi could bring to the ta­ble. Sanofi is a com­mer­cial­iza­tion pow­er­house, they were ex­cit­ed about the sci­ence and will­ing to let it re­main in Rev­o­lu­tion’s hands un­til lat­er stages of de­vel­op­ment. Plus, they were cov­er­ing the costs of R&D (free­ing up Rev­o­lu­tion to ex­pand dis­cov­ery-stage projects), and per­haps most im­por­tant­ly — Sanofi agreed that they would split US prof­its and loss­es 50/50.

“The foun­da­tion­al fea­ture of this busi­ness deal is that 50/50 prof­it and loss share arrange­ment in the US,” Gold­smith said. “This is re­al­ly im­por­tant to us. When cre­at­ing suc­cess­ful biotech com­pa­nies, you can­not aban­don re­al com­mer­cial op­por­tu­ni­ty — in the US es­pe­cial­ly. And frankly, we de­cid­ed if we couldn’t find a part­ner that would share US prof­its then we wouldn’t sign a part­ner at all.”

Luck­i­ly, Sanofi was amenable. Now, Gold­smith said, the com­pa­ny has the re­sources to fo­cus on build­ing its pipeline. With a re­cent $56 mil­lion fundrais­ing round just four months ago — plus this new $50 mil­lion up­front pay­ment — the com­pa­ny is well cap­i­tal­ized to go about dis­cov­er­ing. Rev­o­lu­tion has some on­go­ing projects in mTORC1 and SHP1 that will be the fo­cus mov­ing for­ward.

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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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.

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.

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.

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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Bris­tol My­ers is clean­ing up the post-Cel­gene merg­er pipeline, and they’re sweep­ing out an ex­per­i­men­tal check­point in the process

Back during the lead up to the $74 billion buyout of Celgene, the big biotech’s leadership did a little housecleaning with a major pact it had forged with Jounce. Out went the $2.6 billion deal and a collaboration on ICOS and PD-1.

Celgene, though, also added a $530 million deal — $50 million up front — to get the worldwide rights to JTX-8064, a drug that targets the LILRB2 receptor on macrophages.

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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.

UP­DAT­ED: Es­ti­mat­ing a US price tag of $5K per course, remde­sivir is set to make bil­lions for Gilead, says key an­a­lyst

Data on remdesivir — the first drug shown to benefit Covid-19 patients in a randomized, controlled trial setting — may be murky, but its maker Gilead could reap billions from the sales of the failed Ebola therapy, according to an estimate by a prominent Wall Street analyst. However, the forecast, which is based on a $5,000-per-course US price tag, triggered the ire of one top drug price expert.