As­traZeneca is pay­ing In­nate Phar­ma at least $242M in near-term cash to sew up rights to mon­al­izum­ab-plus

Just 2 days af­ter rolling out a pos­i­tive snap­shot of ac­tiv­i­ty for its NKG2A im­mune check­point in­hibitor mon­al­izum­ab at ES­MO, In­nate Phar­ma SA (Eu­ronext: $IPH) has struck a rich add-on col­lab­o­ra­tion deal with As­traZeneca, which is bulk­ing up its I/O pipeline in a deal that in­cludes $170 mil­lion in up­front pay­ments, a $72 mil­lion eq­ui­ty deal plus bil­lions in added mile­stone pay­ments cov­er­ing a range of de­vel­op­ment pro­grams.

With $242 mil­lion in cash on the ta­ble this year and next, and an­oth­er $100 mil­lion in near-term cash on the ta­ble for piv­ot­ing in­to a late-stage study, As­traZeneca is mak­ing an un­usu­al­ly big pay­out rel­a­tive to its track BD record over the last few years, clear­ly in­di­cat­ing that it sees a big fu­ture for these In­nate ther­a­pies. And they’re get­ting $50 mil­lion back by out-li­cens­ing US and EU rights to a new­ly ap­proved drug in the port­fo­lio, al­low­ing In­nate to be­gin com­mer­cial­iza­tion work in the US.

Shares of In­nate rock­et­ed up 29% on the news.

Let’s break it down.

The jew­el in this crown is mon­al­izum­ab, which promis­es to re­store an im­mune re­sponse by NK and T cells, half of the heart of the I/O ap­proach, where As­traZeneca sees a big fu­ture for Imfinzi, its PD-L1 check­point that al­lows a more ef­fec­tive as­sault by im­mune cells, tak­ing the brakes off the sys­tem.

Pas­cal So­ri­ot

As­traZeneca is pay­ing $100 mil­lion in up­front cash for the on­col­o­gy rights to the ther­a­py, with $100 mil­lion due at the start of Phase III with $825 mil­lion due on a full slate of mile­stones. As­traZeneca will pay 70% of the late-stage de­vel­op­ment cost with In­nate cov­er­ing a capped 30% fig­ure. In­nate has an op­tion on co-pro­mo­tion rights in Eu­rope.

Why mon­al­izum­ab? In Mu­nich in­ves­ti­ga­tors un­veiled ear­ly da­ta on a com­bi­na­tion of mon­al­izum­ab and ce­tux­imab for squa­mous cell car­ci­no­ma of the head and neck.

The da­ta, says the com­pa­ny, re­flect­ed:

(T)he over­all re­sponse rate was 27.5% (by RE­CIST) in­clud­ing 1 con­firmed com­plete re­sponse (2.5%) and 10 par­tial re­spons­es (25%). Dis­ease con­trol rate at 24 weeks (DCR) was 35%. Me­di­an pro­gres­sion-free sur­vival (PFS) and over­all sur­vival (OS) reached 5.0 and 10.3 months, re­spec­tive­ly. In ad­di­tion, there were 3 (18%) re­spon­ders among the 17 pa­tients who had been pre­vi­ous­ly treat­ed with PD-1/L1 an­ti­bod­ies.

Then there’s IPH5201, CD39.

As­traZeneca is pay­ing $50 mil­lion for an op­tion on the rights to the drug, with $835 mil­lion in mile­stone mon­ey. If As­traZeneca takes the op­tion up, they will cov­er the Phase III un­less In­nate steps in on 50% of the cost in ex­change for co-pro­mo­tion rights in Eu­rope.

As­traZeneca is pay­ing $20 mil­lion on op­tions for 4 ad­di­tion­al pre­clin­i­cal pro­grams, with $355 mil­lion in mile­stones on each. Then there’s $72 mil­lion go­ing in­to the ac­qui­si­tion of 9.8% of In­nate’s eq­ui­ty.

In­nate, mean­while, agreed to pay $50 mil­lion for Lu­mox­i­ti, the new­ly ap­proved drug for rare cas­es of third-line hairy cell leukemia that As­traZeneca has planned to sell for $150,000 cov­er­ing 6 treat­ment cy­cles.

That all amounts to an un­usu­al big-mon­ey deal for As­traZeneca, which has been sell­ing as­sets re­cent­ly to help cov­er costs as Pas­cal So­ri­ot bets big on new can­cer drugs like Lyn­parza and Tagris­so and Imfinzi to turn things around at the phar­ma gi­ant. With those drugs ac­cel­er­at­ing on the mar­ket, he’s now adding a drug with hu­man da­ta to start back­ing up its promise.

So­ri­ot said that the deal al­lows his com­pa­ny to “fur­ther strength­en our lead­er­ship in im­muno-on­col­o­gy, and to ex­plore the po­ten­tial of next gen­er­a­tion im­muno-on­col­o­gy path­ways, to­geth­er with the world-class sci­en­tif­ic team of In­nate.”

UP­DAT­ED: In sur­prise switch, Bris­tol-My­ers is sell­ing off block­buster Ote­zla, promis­ing to com­plete Cel­gene ac­qui­si­tion — just lat­er

Apart from revealing its checkpoint inhibitor Opdivo blew a big liver cancer study on Monday, Bristol-Myers Squibb said its plans to swallow Celgene will require the sale of blockbuster psoriasis treatment Otezla to keep the Federal Trade Commission (FTC) at bay.

The announcement — which has potentially delayed the completion of the takeover to early 2020 — irked investors, triggering the New York-based drugmaker’s shares to tumble Monday morning in premarket trading.

Celgene’s Otezla, approved in 2014 for psoriasis and psoriatic arthritis, is a rising star. It generated global sales of $1.6 billion last year, up from the nearly $1.3 billion in 2017. Apart from the partial overlap of Bristol-Myers injectable Orencia, the company’s rival oral TYK2 psoriasis drug is in late-stage development, after the firm posted encouraging mid-stage data on the drug, BMS-986165, last fall. With Monday’s decision, it appears Bristol-Myers is favoring its experimental drug, and discounting Otezla’s future.

The move blindsided some analysts. Credit Suisse’s Vamil Divan noted just days ago:

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Novotech CEO Dr. John Moller

Novotech CRO Award­ed Frost & Sul­li­van Best Biotech CRO Asia-Pa­cif­ic 2019

Known in the in­dus­try as the Asia-Pa­cif­ic CRO, Novotech is now lead CRO ser­vices provider for the grow­ing num­ber of in­ter­na­tion­al biotechs se­lect­ing the re­gion for their stud­ies.

Re­flect­ing this Asia-Pa­cif­ic growth, Novotech staff num­bers are up 20% since De­cem­ber 2018 to 600 in-house clin­i­cal re­search peo­ple across a full range of ser­vices, across the re­gion.

Novotech’s ca­pa­bil­i­ties have been rec­og­nized by an­a­lysts like Frost & Sul­li­van, most re­cent­ly with the pres­ti­gious Asia-Pa­cif­ic CRO Biotech of the year award for best prac­tices in clin­i­cal re­search for biotechs for the fifth year. See oth­er awards here.

Bris­tol-My­ers star Op­di­vo fails sur­vival test in a matchup with Nex­avar aimed at shak­ing up the big HCC mar­ket

Bris­tol-My­ers Squibb has suf­fered an­oth­er painful set­back in its years-long quest to ex­pand the reach of Op­di­vo. The phar­ma gi­ant this morn­ing not­ed that their Check­mate-459 study com­par­ing Op­di­vo with Bay­er’s Nex­avar in front­line cas­es of he­pa­to­cel­lu­lar car­ci­no­ma — the most com­mon form of liv­er can­cer — failed to hit the pri­ma­ry end­point on over­all sur­vival.

This was a sig­nif­i­cant mile­stone in Bris­tol-My­ers’ tal­ly of PD-1 cat­a­lysts this year. Nex­avar (so­rafenib) has been the stan­dard of care in front­line HCC for the past decade, though Op­di­vo has been mak­ing head­way in sec­ond-line HCC cas­es, where it’s go­ing toe-to-toe with Bay­er’s Sti­var­ga (re­go­rafenib) af­ter re­cent ap­provals shook up the mar­ket.

Fol­low­ing news of job cuts in Eu­ro­pean R&D ops, Sanofi con­firms it’s of­fer­ing US work­ers an 'ear­ly ex­it'

Ear­li­er in the week we learned that Sanofi was bring­ing out the bud­get ax to trim 466 R&D jobs in Eu­rope, re­tool­ing its ap­proach to car­dio as re­search chief John Reed beefed up their work in can­cer and gene ther­a­pies. And we’re end­ing the week with news that the phar­ma gi­ant has al­so been qui­et­ly re­duc­ing staff in the US, tar­get­ing hun­dreds of jobs as the com­pa­ny push­es vol­un­tary buy­outs with a fo­cus on R&D sup­port ser­vices.

Suf­fer­ing No­var­tis part­ner Cona­tus is pack­ing it in on NASH af­ter a se­ries of un­for­tu­nate tri­al events

The NASH par­ty is over at No­var­tis-backed Cona­tus. And this time they’re turn­ing off the lights.

More than 2 years af­ter No­var­tis sur­prised the biotech in­vest­ment com­mu­ni­ty with its $50 mil­lion up­front and promise of R&D sup­port to part­ner with the lit­tle biotech on NASH — ig­nit­ing a light­ning strike for the share price — Cona­tus $CNAT is back with the lat­est bit­ter tale to tell about em­ri­c­as­an, which once in­spired con­fi­dence at the phar­ma gi­ant.

Dean Hum. Nasdaq via YouTube

Gen­fit goes to Chi­na with a deal worth up to $228M for NASH drug

Fresh off the high of its Nas­daq IPO de­but, and the low of com­par­isons to Cymabay — whose NASH drug re­cent­ly stum­bled — Gen­fit on Mon­day un­veiled an up to $228 mil­lion deal with transpa­cif­ic biotech Terns Phar­ma­ceu­ti­cals to de­vel­op its flag­ship ex­per­i­men­tal liv­er drug — elafi­bra­nor — in Greater Chi­na.

The deal comes more than a week af­ter Gen­fit $GN­FT is­sued a fiery de­fense of its dual PPAR ag­o­nist elafi­bra­nor, when com­peti­tor Cymabay’s PPARδ ag­o­nist, se­ladel­par, fiz­zled in a snap­shot of da­ta from an on­go­ing mid-stage tri­al. The main goal at the end of 12 weeks was for se­ladel­par to in­duce a sta­tis­ti­cal­ly sig­nif­i­cant im­prove­ment in liv­er fat con­tent, but da­ta showed that pa­tients on the place­bo ac­tu­al­ly per­formed bet­ter.

Alex­ion wins pri­or­i­ty re­view for Ul­tomiris' aHUS in­di­ca­tion; FDA ex­pands ap­proval of Ver­tex's Symdeko

→ Alex­ion $ALXN has scored a speedy re­view for Ul­tomiris for pa­tients with atyp­i­cal he­molyt­ic ure­mic syn­drome (aHUS) af­ter post­ing pos­i­tive da­ta from a piv­otal study in Jan­u­ary. The drug is the rare dis­ease com­pa­ny’s shot at pro­tect­ing its block­buster blood dis­or­der fran­chise that is cur­rent­ly cen­tered around its flag­ship drug, Soliris, which is a com­ple­ment in­hibitor typ­i­cal­ly ad­min­is­tered every two weeks. Ul­tomiris has a sim­i­lar mech­a­nism of ac­tion but re­quires less-fre­quent dos­ing — every eight weeks. The de­ci­sion date has been set to Oc­to­ber 19. Late last year, Ul­tomiris se­cured ap­proval for noc­tur­nal he­mo­glo­bin­uria (PNH) pa­tients.

Bet­ter than Am­bi­en? Min­er­va soars on PhI­Ib up­date on sel­torex­ant for in­som­nia

A month af­ter roil­ing in­vestors with what skep­tics dis­missed as cher­ry pick­ing of its de­pres­sion da­ta, Min­er­va is back with a clean slate of da­ta from its Phase IIb in­som­nia tri­al.

In a de­tailed up­date, the Waltham, MA-based biotech said sel­torex­ant (MIN-202) hit both the pri­ma­ry and sev­er­al sec­ondary end­points, ef­fec­tive­ly im­prov­ing sleep in­duc­tion and pro­long­ing sleep du­ra­tion. In­ves­ti­ga­tors made a point to note that the ef­fects were con­sis­tent across the adult and el­der­ly pop­u­la­tions, with the lat­ter more prone to the sleep dis­or­der.

Gene ther­a­py biotech sees its stock rock­et high­er on promis­ing re­sults for rare cas­es of but­ter­fly dis­ease

Shares of Krys­tal Biotech took off this morn­ing $KRYS af­ter the lit­tle biotech re­port­ed promis­ing re­sults from its gene ther­a­py to treat a rare skin dis­ease called epi­der­mol­y­sis bul­losa.

Fo­cus­ing on an up­date with 4 new pa­tients, re­searchers spot­light­ed the suc­cess of KB103 in clos­ing some stub­born wounds. Krys­tal says that of 4 re­cur­ring and 2 chron­ic skin wounds treat­ed with the gene ther­a­py, the KB103 group saw the clo­sure of 5. The 6th — a chron­ic wound, de­fined as a wound that had re­mained open for more than 12 weeks — was par­tial­ly closed. That brings the to­tal so far to 8 treat­ed wounds, with 7 clo­sures.