Nick Leschly via Getty

Blue­bird shares sink as an­a­lysts puz­zle out $1.8M stick­er shock and an un­ex­pect­ed de­lay

Blue­bird bio $BLUE has un­veiled its price for the new­ly ap­proved gene ther­a­py Zyn­te­glo (Lenti­Glo­bin), which came as a big sur­prise. And it wasn’t the on­ly un­ex­pect­ed twist in to­day’s sto­ry.

With some an­a­lysts bet­ting on a $900,000 price for the β-tha­lassemia treat­ment in Eu­rope, where reg­u­la­tors pro­vid­ed a con­di­tion­al ear­ly OK, blue­bird CEO Nick Leschly said Fri­day morn­ing that the pa­tients who are suc­cess­ful­ly treat­ed with their drug over 5 years will be charged twice that — $1.8 mil­lion — on the con­ti­nent. That makes this drug the sec­ond most ex­pen­sive ther­a­py on the plan­et, just be­hind No­var­tis’ new­ly ap­proved Zol­gens­ma at $2.1 mil­lion, with an­a­lysts still wait­ing to see what kind of pre­mi­um can be had in the US.

Like No­var­tis, blue­bird will be set­ting it up as an in­stall­ment plan, with the charges spread out over 5 years as physi­cians eval­u­ate whether it’s work­ing or not. The com­pa­ny will charge 315,000 eu­ros a year. If it works, the an­nu­al pay­ments will con­tin­ue, Leschly said in a call to­day, “if not, they stop. It’s not rock­et sci­ence; it just makes sense.”

These new, high­er, num­bers will spur an­a­lysts to sit down and crunch the num­bers again for this drug. SVB Leerink es­ti­mat­ed peak sales of $800 mil­lion for the first in­di­ca­tion, with sick­le cell dis­ease tak­ing that in­to block­buster ter­ri­to­ry. 

But in­vestors didn’t warm up to the pre­sen­ta­tion for the biotech, which has a mar­ket cap of $6.5 bil­lion. Blue­bird shares slid 4.5% in ear­ly trad­ing Fri­day. By ear­ly af­ter­noon the stock was more than 5% in the red.

Leschly says blue­bird has es­tab­lished a clear “in­trin­sic” val­ue of $2.1 mil­lion — de­liv­er­ing 22 QALYs, or qual­i­ty-ad­just­ed life years — for the most suc­cess­ful cas­es, not­ing that their price re­flects a 15% dis­count on that fig­ure. But the biotech al­so looked at pro­vid­ing a one-time treat­ment that could de­liv­er a life­time of val­ue — with­out ac­tu­al­ly prov­ing just how long these ther­a­pies can be ef­fec­tive. And they pro­pose be­ing ful­ly paid in 5 years, leav­ing pay­ers to con­sid­er what hap­pens if it fails past that point.

An­oth­er point: This is a com­pli­cat­ed pro­ce­dure, which adds costs on top of the treat­ment ex­pense.

Then, in the ear­ly af­ter­noon, Cowen an­a­lyst Yaron Wer­ber got in­to the act, not­ing his sur­prise that blue­bird is de­lay­ing the launch in or­der to make some last minute changes to the man­u­fac­tur­ing process, which adds an ex­tra el­e­ment of risk for the biotech.

(T)he key un­ex­pect­ed news is that EMA has re­quest­ed amend­ments to the fi­nal drug prod­ucts spec­i­fi­ca­tions and to the man­u­fac­tur­ing pa­ra­me­ters. Hence this de­lays the launch and would re­move any sales in FY19 to ear­ly ’20. The good news is that it would en­able blue to on­board the qual­i­fied treat­ment cen­ters and help fur­ther prep for the launch. How­ev­er, un­ques­tion­ably this re­quest adds an el­e­ment of sur­prise and would re­quire blue to make a few mn­fg process changes ahead of launch which would al­so add some new risk.

Leschly care­ful­ly de­tailed how the com­pa­ny came up with its price and pay­ment mod­el, not­ing that the sys­tem is geared to cov­er­ing the cost of care de­liv­ered over a longterm ba­sis, rather than a po­ten­tial one-time event.

In mak­ing the case for the drug, blue­bird’s CEO used a health eco­nom­ics case, eval­u­at­ing the gains in life ex­pectan­cy and the qual­i­ty of life mea­sures. Leschly al­so specif­i­cal­ly ex­clud­ed the sav­ings from the ther­a­py Zyn­te­glo re­places.

“In prin­ci­ple, I ac­tu­al­ly think this is progress,” says Pe­ter Bach from the Memo­r­i­al Sloan Ket­ter­ing Can­cer Cen­ter, “I ac­tu­al­ly think it’s a good trend.”

But…

If they re­al­ly want to fol­low through with a rig­or­ous health eco­nom­ics case, says Bach, they should pub­lish their num­bers so pay­ers could take a care­ful look at how they ac­tu­al­ly stack up. Al­so, if they want­ed to be con­sis­tent, he adds, the com­pa­ny could start with a price that made sense based on the da­ta at hand, and then ad­just it as they find out more about how it works on a longterm ba­sis.

“In the old days you could come to mar­ket when you proved drugs work with dura­bil­i­ty. Now they come with un­sure dura­bil­i­ty, but they still want to charge at the up­per end.” And they’re get­ting the full pay­ment for a life­time ben­e­fit in the first 5 years, shift­ing the risk on­to pa­tients and pay­ers.

When it works, blue­bird bio’s gene ther­a­py for β-tha­lassemia has been shown to keep pa­tients trans­fu­sion free for up to 3.8 years, ac­cord­ing to an up­date to­day at the big EHA meet­ing. But even some Wall Street an­a­lysts are hav­ing trou­ble with the price, as well as the mar­ket ex­pec­ta­tions. Piper Jaf­fray’s Tyler Van Bu­ren:

(B)ased on con­sen­sus es­ti­mates, the Street is mod­el­ing that blue­bird trans­plants thou­sands of pa­tients with Zyn­te­glo/Lenti­Glo­bin. Put sim­ply, this is a dis­con­nect that is im­pos­si­ble for us to rec­on­cile. We al­so be­lieve that the $1.8MM price tag of Zyn­te­glo is hard to jus­ti­fy giv­en the $2.1MM comp of Zol­gens­ma, which treats chil­dren with a cer­tain out­come of death, as op­posed to a pop­u­la­tion where the ma­jor­i­ty of pa­tients are ad­e­quate­ly main­tained on trans­fu­sions.

And this is from SVB Leerink’s Mani Foroohar:

Like any cell ther­a­py, ‘process is the prod­uct’ for Zyn­te­glo, and whether the ul­ti­mate com­mer­cial prod­uct will live up to the clin­i­cal da­ta seen to date is un­clear due to nec­es­sary man­u­fac­tur­ing changes — in­creas­ing the risk to the 80% of rev­enue/pa­tient at-risk un­der a 5-yr val­ue based con­tract. More con­cern­ing is that BLUE was un­able to ex­e­cute on the man­u­fac­tur­ing process de­vel­op­ment that is the crit­i­cal core com­pe­ten­cy of any cell ther­a­py fran­chise, per­haps rais­ing ques­tions on the com­pa­ny’s abil­i­ty to hit stat­ed time­lines for many of its pro­grams.

The dev­il, as al­ways, is in the da­ta.

Here’s the lat­est from blue­bird $BLUE: While 8 of 10 pa­tients with a less se­vere form of the dis­ease re­main trans­fu­sion-free in the Phase I/II study used for the reg­u­la­to­ry sub­mis­sions, it’s not a sure thing. And in an­oth­er group of 8 pa­tients with a β0/β0 geno­type, on­ly 3 were trans­fu­sion in­de­pen­dent.

Those re­sults now ex­tend over to the Phase III tri­al, where 4 of 5 pa­tients with­out the β0/β0 geno­type are trans­fu­sion-free. One evalu­able pa­tient with the more se­vere form of the dis­ease achieved in­de­pen­dence from trans­fu­sions, and 5 pa­tients had stopped trans­fu­sions for at least three months.

That 3.8 years of trans­fu­sion in­de­pen­dence is crit­i­cal for blue­bird.

These dis­cus­sions by the pi­o­neers in the field will prove tremen­dous­ly in­flu­en­tial for the rest of the field, lock­ing in price ranges and pay­ment plans that — if they work — may well dic­tate the num­bers for every­one else. 

George Yancopoulos (Regeneron)

Re­gen­eron co-founder George Yan­copou­los of­fers a com­bat­ive de­fense of the po­lice at a high school com­mence­ment. It didn’t go well

Typically, the commencement speech at Yorktown Central School District in Westchester — like most high schools — is an opportunity to encourage students to face the future with confidence and hope. Regeneron president and co-founder George Yancopoulos, though, went a different route.

In a fiery speech, the outspoken billionaire defended the police against the “prejudice and bias against law enforcement” that has erupted around the country in street protests from coast to coast. And for many who attended the commencement, Yancopoulos struck the wrong note at the wrong time, especially when he combatively challenged someone for interrupting his speech with a honk for “another act of cowardness.”

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Elias Zerhouni (Photo by Vincent Isore/IP3/Getty Images)

Elias Zer­houni dis­cuss­es ‘am­a­teur hour’ in DC, the de­struc­tion of in­fec­tious dis­ease R&D and how we need to prep for the next time

Elias Zerhouni favors blunt talk, and in a recent discussion with NPR, the ex-Sanofi R&D and ex-NIH chief had some tough points to make regarding the pandemic response.

Rather than interpret them, I thought it would be best to provide snippets straight from the interview.

On the Trump administration response:

It was basically amateur hour. There is no central concept of operations for preparedness, for pandemics, period. This administration doesn’t want to or has no concept of what it takes to protect the American people and the world because it is codependent. You can’t close your borders and say, “OK, we’re going to be safe.” You’re not going to be able to do that in this world. So it’s a lack of vision, basically just a lack of understanding, of what it takes to protect the American people.

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Pfiz­er shares surge on pos­i­tive im­pact of their mR­NA Covid-19 vac­cine — part­nered with BioN­Tech — in an ear­ly-stage study

Pfizer and their partners at the mRNA specialist BioNTech have published the first glimpse of biomarker data from an early-stage study spotlighting the “robust immunogenicity” triggered by their Covid-19 vaccine, which is one of the leaders in the race to vanquish the global pandemic.

Researchers selected 45 healthy volunteers 18-55 years of age for the study. They were randomized to receive 2 doses, separated by 21 days, of 10 µg, 30 µg, or 100 µg of BNT162b1, “a lipid nanoparticle-formulated, nucleoside-modified, mRNA vaccine that encodes trimerized SARS-CoV-2 spike glycoprotein RBD.” Their responses were compared against the effect of a natural, presumably protective defense offered by a regular infection.

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An ex­pe­ri­enced biotech is stitched to­geth­er from transpa­cif­ic parts, with 265 staffers and a fo­cus on ‘new bi­ol­o­gy’

Over the past few years, different teams at a pair of US-based biotechs and in labs in Japan have labored to piece together a group of cancer drug programs, sharing a single corporate umbrella with research colleagues in Japan. But now their far-flung operations have been knit together into a single unit, creating a pipeline with 10 cancer drug development programs — going from early-stage right into Phase III — and a host of discovery projects managed by a collective staff of some 265 people.

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Sec­ond death trig­gers hold on Astel­las' $3B gene ther­a­py biotech's lead pro­gram, rais­ing fresh con­cerns about AAV

Seven months after Astellas shelled out $3 billion to acquire the gene therapy player Audentes, the biotech company’s lead program has been put on hold following the death of 2 patients taking a high dose of their treatment. And there was another serious adverse event recorded in the study as well, with a total of 3 “older” patients in the study affected.

The incidents are derailing plans to file for a near-term approval, which had been expected right about now.

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Joseph Kim, Inovio CEO (Andrew Harnik, AP Images)

Pos­i­tive Covid-19 vac­cine da­ta? New mouse study? OWS in­clu­sion? Yep, but some­how, the usu­al tid­bits from In­ovio back­fire

You don’t go more than 40 years in biotech without ever getting a product to market unless you can learn the art of writing a promotional press release. And Inovio captures the prize in baiting the hook.

Tuesday morning Inovio, which has been struggling to get its Covid-19 vaccine lined up for mass manufacturing, put out a release that touched on virtually every hot button in pandemic PR.

There was, first and foremost, an interim snapshot of efficacy from their Phase I program for INO-4800.

Jan van de Winkel, Genmab CEO

Seat­tle Ge­net­ics, Gen­mab turn on TV for a high­light reel in cer­vi­cal can­cer — but a ri­val biotech promis­es a bet­ter show

Seattle Genetics $SGEN and their partners at Genmab $GMAB polished up some positive Phase II numbers for their antibody drug conjugate tisotumab vedotin — you can call it TV — for recurrent cervical cancer. And while they mapped out a shortcut to a potential quick approval, the big challenge for this team is being presented by a rival biotech which muscled its way into the spotlight for the same indication a year ago.

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Randy Schatzman, Bolt CEO (Bolt Biotherapeutics)

Bolt Bio­ther­a­peu­tics nabs $93.5M to push Provenge in­ven­tor's new idea deep­er in the clin­ic

A cancer-fighting concept from the inventor of the first cancer vaccine is nearing prime time, and its biotech developer has received a significant new infusion of cash to get it there.

Bolt Biotherapeutics announced a $93.5 million Series C round led by Sofinnova Investments and joined by more than 9 others, including Pfizer Ventures and RA Capital Management. That money will go toward pushing the San Francisco biotech’s platform of innate immune-boosting warheads through its first trial on metastatic solid tumors and into several more.

Days af­ter In­ter­cept re­jec­tion, Akero surges on ‘un­prece­dent­ed‘ NASH da­ta

A year and a half after scoring a $70 million Series B and a top Gilead executive as CEO, Akero Therapeutics has announced new data on their NASH drug. And with the field still reeling from a surprise FDA rejection this week, the news was enough to send their stock surging.

Akero had already said in March that its lead drug had beaten placebo in its Phase II trial, reducing liver fat by 14% in the highest dose group compared to 0.3% in placebo, according to MRI scans. But although NASH is an obesity-related condition and results from fatty buildup in the liver, the real immediate question for any therapy is whether it can resolve the fibrosis and inflammation that results from that buildup. Those data require biopsying the patients, a longer and more invasive process that was further complicated by a pandemic.