Arie Bellde­grun rais­es $300M, grabs Pfiz­er’s al­lo­gene­ic CAR-T port­fo­lio and launch­es a ground­break­ing dri­ve to com­mer­cial­iza­tion

Af­ter pi­o­neer­ing one of the first per­son­al­ized CAR-T ther­a­pies to be ap­proved by the FDA, Kite vets Arie Bellde­grun and re­search chief David Chang have now launched a new biotech with a whop­ping $300 mil­lion in cash fi­nanc­ing and a col­lab­o­ra­tion with Cel­lec­tis af­ter bag­ging the full port­fo­lio of off-the-shelf CAR-T drugs in de­vel­op­ment at Pfiz­er.

Bellde­grun — who came away with a for­tune of more than $600 mil­lion from the sale of the biotech to Gilead — tells me he gained swift back­ing from a broad syn­di­cate to cre­ate Al­lo­gene Ther­a­peu­tics. And they’re jump­ing out of stage left with a deal that gives them con­trol of Pfiz­er’s CAR-T port­fo­lio, which in­cludes rights to the ear­ly-stage UCART19 al­lied with Paris-backed Cel­lec­tis.

In ex­change, Pfiz­er is get­ting a 25% stake in Al­lo­gene, which im­me­di­ate­ly vaults from out of nowhere in­to a lead­ing po­si­tion among de­vel­op­ers of off-the-shelf CAR-T ther­a­pies, look­ing to leapfrog the first gen­er­a­tion of per­son­al­ized CAR-Ts that use reengi­neered pa­tient cells.

“We have every one of the in­ter­est­ing tar­gets that I’m aware of,” says Bellde­grun, the new­ly mint­ed ex­ec­u­tive chair­man at Al­lo­gene, with Chang tak­ing the CEO job. And they’re ready to get to work with Cel­lec­tis, Servi­er and every­one else en­gaged in the “Man­hat­tan project” of bring­ing the first al­lo­gene­ic CAR-T to mar­ket.

“This is the biggest project,” Bellde­grun says. “This is where cel­lu­lar ther­a­py will find its way.”

David Chang

Bellde­grun and Chang told me in a pre­view of the an­nounce­ment Mon­day evening that the deal be­gan to come to­geth­er the night they were cel­e­brat­ing the close of the Kite sale, when one of the bankers in­volved told them about a po­ten­tial deal he knew of.

In­stead of a leisure­ly va­ca­tion break, what fol­lowed was 5 months of in­tense ne­go­ti­a­tions, in which Bellde­grun got a close, up­front look at the 16 tar­gets that a team of 70 Pfiz­er in­ves­ti­ga­tors have been work­ing on for the past 4 years, along with UCART19, the 17th pro­gram in the deal.

“I looked at the da­ta and said ‘David, we need to do this, it’s a gold mine.’ It’s a deal I couldn’t refuse,” says Bellde­grun. “We know it’s the fu­ture.”

In­stead of a lengthy and ex­pen­sive per­son­al­ized au­tol­o­gous ap­proach that re­quires the ex­trac­tion and reengi­neer­ing of pa­tient cells in­to a po­tent ther­a­py that has proved par­tic­u­lar­ly ef­fec­tive in blood can­cers, Bellde­grun will now look to per­fect a gene edit­ing process that can de­vel­op 50 to 100 ther­a­peu­tic batch­es from a sin­gle donor. If it works, it will be cheap­er and faster than the first CAR-Ts, Yescar­ta and Kym­ri­ah.

This was a deal that in­volved “mul­ti­ple” bid­ders, says Bellde­grun, will­ing to pay a sig­nif­i­cant amount to buy in. But he says he and Chang were able to put to­geth­er the win­ning of­fer by keep­ing Pfiz­er close­ly en­gaged in the start­up and a clin­i­cal dri­ve that could get them to the thresh­old of com­mer­cial­iza­tion in just a few years.

With back­ers deeply im­pressed by their $12 bil­lion sale of Kite to Gilead, Bellde­grun and Chang are work­ing with in­vest­ments from TPG, Vi­da Ven­tures, Bell­Co Cap­i­tal, the Uni­ver­si­ty of Cal­i­for­nia Of­fice of the Chief In­vest­ment Of­fi­cer and Pfiz­er.

The pair of en­tre­pre­neurs are get­ting a team of about 50 Pfiz­er in­ves­ti­ga­tors to trans­fer over in the deal, tak­ing over Pfiz­er space for now in South San Fran­cis­co as they scout their own new digs. And Bellde­grun says they have al­ready lined up a string of “top notch” play­ers to join the com­pa­ny. 

You can ex­pect the pay­roll to dou­ble in the next year, he adds.

An­dré Chouli­ka

The deal teams Bellde­grun and Chang with Cel­lec­tis CEO An­dré Chouli­ka, the French biotech ex­ec who’s been steer­ing the first off-the-shelf CAR-T in­to hu­man stud­ies. Servi­er and Pfiz­er launched a land­mark tri­al of Cel­lec­tis’ UCART19 for acute lym­phoblas­tic leukemia, get­ting the green light to ex­pand from the UK in­to US sites a year ago.

I ran in­to Chouli­ka at an an­a­lysts meet­ing Bellde­grun or­ga­nized for Kite in New York a cou­ple of years ago. It struck me as odd see­ing the al­lo­gene­ic leader at the ri­val au­tol­o­gous gath­er­ing, but Chouli­ka tells me it was part of a long re­la­tion­ship that has con­verged in­to this new deal.

“Arie and my­self have been talk­ing for a long time,” Chouli­ka told me. The mu­tu­al re­spect they de­vel­oped, he says, com­bined with Kite’s ster­ling rep for ex­e­cu­tion, helped bring it all to­geth­er.

“I was con­vinced that Kite would be the win­ner in the au­tol­o­gous space,” says Chouli­ka. And he thinks the new team at Al­lo­gene, com­bined with Cel­lec­tis’ know-how on gene edit­ing, will ac­cel­er­ate the work on their lead ther­a­py, with a shot at com­mer­cial­iza­tion work in late 2021 or ’22.

The tech­nol­o­gy may be still ap­pear to be quite ear­ly, but Bellde­grun paints a pic­ture of glob­al in­vestors ea­ger to get in now. 

The $300 mil­lion came to­geth­er in a mat­ter of weeks, says Bellde­grun, who adds that it would have been easy to raise twice that amount. For now, he’s not short of cash — and he says he and Chang al­so put their own mon­ey in­to the deal. As they go for­ward, con­sid­er­ing the need to build their own ded­i­cat­ed man­u­fac­tur­ing, he ex­pects they’ll be able to raise more cash as need­ed.

So why not take the mon­ey from the Kite deal and take an ex­tend­ed va­ca­tion?

“I think at the end it’s not mon­ey that dri­ves what we do,” says Chang, who was cleared to leave Kite in Feb­ru­ary af­ter stay­ing on for the tran­si­tion. “It’s re­al­ly the ac­tiv­i­ty that will sat­is­fy you, or some­thing that’s deep down in you.”

RWE chal­lenges for to­day's bio­phar­ma

The rapid development of technology — and the resulting avalanche of data — are catalysts for significant change in the biopharmaceutical industry. This translates into urgent pressures for today’s biopharma, including a need to quickly and affordably develop products with proven therapeutic efficacy and value. This urgency is expedited by the growth of value-based contracting, where access to reimbursement and profit depends on these abilities.

UP­DAT­ED: In a stun­ning turn­around, Bio­gen says that ad­u­canum­ab does work for Alzheimer's — but da­ta min­ing in­cites con­tro­ver­sy and ques­tions

Biogen has confounded the biotech world one more time.

In a stunning about-face, the company and its partners at Eisai say that a new analysis of a larger dataset on aducanumab has restored its faith in the drug as a game-changer for Alzheimer’s and, after talking it over with the FDA, they’ll now be filing for an approval of a drug that had been given up for dead.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 63,100+ biopharma pros reading Endpoints daily — and it's free.

As shares suf­fer from a lin­ger­ing slump, a bruised Alk­er­mes slash­es 160 jobs in R&D re­struc­tur­ing

With its share price in a deep slump after suffering through a regulatory debacle over their depression drug ALKS 5461, Alkermes CEO Richard Pops is taking the ax to its R&D organization in a restructuring aimed at cutting costs ahead of its next attempt at a rollout in a tough field.

Richard Pops, Endpoints via Youtube

Click on the image to see the full-sized version

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 63,100+ biopharma pros reading Endpoints daily — and it's free.

Acor­da's Ron Co­hen brings the ax back out as new drug sales on­ly trick­le in while cash cow is led to the slaugh­ter

With its new drug earning meager sums and its one-time cash cow reduced to a bony shadow of its former self, Acorda Therapeutics today is rolling out a new restructuring aimed at slashing the staff and cutting costs to get through the hard times ahead.

The biotech is chopping a quarter of its staff today, carving back R&D as well as SG&A expenses. And CEO Ron Cohen is cutting deep.

Under the new austerity budget, Acorda’s R&D expenses for the full year 2019 are expected to be $55 – $60 million, reduced from $70 – $80 million. SG&A expenses for the full year 2019 are expected to be $185 – $190 million, reduced from $200 – $210 million. R&D expenses for the full year 2020 are expected to be $20 – $25 million and SG&A
expenses for the full year 2020 are expected to be $160 – $165 million.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 63,100+ biopharma pros reading Endpoints daily — and it's free.

RAPT Ther­a­peu­tics re­turns to Wall Street to re­vive IPO bid

On May 24, FLX Bio, a small cancer and inflammation biotech with backing from GV, changed its name to RAPT Therapeutics and filed confidentially for an IPO. On July 5th, they filed to raise up to $86 million. On July 22, they announced the IPO with a $75 million goal.  And on August 1, they abruptly and without explanation called it all off.

Now, without explanation, they’re reviving the bid, filing again for a $75 million IPO, this time with a new bookrunner and a new drug candidate in the clinic. The terms will be the same: 5 million shares at $14-$16 per share. It would give them a diluted market value of $351 million.

EY vet set to re­place re­tir­ing Am­gen CFO Meline

Ahead of its third-quarter results next week, Amgen on Tuesday disclosed the planned retirement of David Meline, who has served as the company’s chief financial officer since 2014.

Meline will be replaced by Ernst & Young vet, Peter Griffith, as CFO come January 1, 2020 — but until then Griffith will serve as executive vice president, finance.

“Over the last 5 years at Amgen, Meline instituted many major changes that led to operational efficiencies and margin expansion while successfully returning cash to shareholders. Now that Amgen is on solid footing, it was a good time to step away,” Cowen’s Yaron Werber wrote in a note. “We do not anticipate any major changes to strategy or operations immediately due to this transition as Amgen is on solid footing.”

Eli Lil­ly’s USA, di­a­betes chief En­rique Con­ter­no is head­ing out af­ter 27 years, and he’s be­ing re­placed by a com­pa­ny in­sid­er

Close to 3 years after Eli Lilly CEO Dave Ricks added the title of president of the US operations to Enrique Conterno’s resume, which included his helmsmanship of the diabetes franchise, the Peruvian born exec is set to retire after a 27-year run at the pharma giant.

Lilly put out the news just as it was posting Q3 results, with a mix of upbeat and downbeat results in the latest set of numbers from Lilly.
Conterno — a grizzled, deeply experienced and sometimes gruff veteran of the pharma world — was a high-profile figure at Lilly, stepping up to expanded duties as the company was forced to deal with intense pricing pressure on the diabetes side of the business. He had replaced outgoing US president Alex Azar, who later popped up as head of Health and Human Services in the Trump administration.
As head of the diabetes unit, Conterno had to deal with an extraordinarily competitive field as payers demanded bigger discounts. Trulicity’s success helped generate new revenue for the company, but Q3’s miss on revenue had a lot to do with the need for discounting the drug ahead of Novo Nordisk’s rival therapy, Rybelsus, which was priced on the wholesale level at an almost identical rate.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 63,100+ biopharma pros reading Endpoints daily — and it's free.

No­var­tis hands off $80M in cash to part­ner up with a top biotech play­er in the fi­bro­sis sec­tor

Never underestimate the power of a good showing at a scientific conference.
In a presentation late last year, the researchers at Pliant Therapeutics launched a series of discussions about the preclinical data they were pulling together around their work on their small-molecule integrin inhibitor aimed at transforming growth factor beta, or TGF-β, a key pathway involved in fibrosis.
And they got some serious attention for the work.
“We got interest from pharma partners and at the end Novartis basically made it,” says Pliant CEO Bernard Coulie.

Is there a recipe for M&A suc­cess? The best and worst buy­out deals in the past decade of­fer some keys to suc­cess — and fail­ure

It’s not easy achieving a solid win in M&A in this industry. But if you follow a few simple guidelines, you may be able to increase your odds of success.
Geoffrey Porges and the team at SVB Leerink went about the “notoriously difficult” task of scoring the biopharma buyout of 2009 to 2019. Sizing up current and expected revenue from the products that were gained, they came up with the 5 winners:
Merck/Schering Plough
Bristol/Medarex
Gilead/Pharmasset
Sanofi/Genzyme
AstraZeneca/Acerta
It says a lot about the field that it’s much easier sorting out the 5 worst deals, though there’s also a lot more competition for that title, notes Porges. As picked by the analysts:
J&J/Actelion
Merck/Cubist
Alexion/Synageva
AbbVie/Stemcentrx
Gilead/Kite

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 63,100+ biopharma pros reading Endpoints daily — and it's free.