At­las wraps Arteaus sto­ry with $260M roy­al­ty sale as Em­gal­i­ty sales inch­es up­ward

Six months af­ter Eli Lil­ly notched a sec­ond-run­ner-up ap­proval for its CGRP mi­graine drug Em­gal­i­ty, the At­las-found­ed biotech that brought it over the proof-of-con­cept gate five years ago has sold all its roy­al­ty in­ter­est for $260 mil­lion.

In Arteaus’ “fi­nal chap­ter” — as At­las part­ner Bruce Booth calls it — the now-de­funct biotech hand­ed Roy­al­ty Phar­ma all pro­ceeds it would earn on fu­ture glob­al net sales of Em­gal­i­ty. The deal marks the fi­nal mon­e­ti­za­tion from Arteaus, which ceased op­er­a­tions as an in­de­pen­dent en­ti­ty af­ter Eli Lil­ly bought back rights to the drug in 2014.

Bought back, be­cause the drug was Lil­ly’s to start with. Arteaus was cre­at­ed cir­ca 2010 as a “built to buy” com­pa­ny amid dis­cus­sions be­tween At­las and Eli Lil­ly to ex­ter­nal­ize the Big Phar­ma’s R&D ef­forts. A lean team of ex­pe­ri­enced biotech ex­ecs (led by Dave Grayzel) li­censed what was then called gal­canezum­ab, raised $18 mil­lion in Se­ries A mon­ey and de­liv­ered re­sults from two dose as­cend­ing stud­ies as well as a Phase II ef­fi­ca­cy study with­in three years.

“Based on­ly on pub­lic dis­clo­sures, Arteaus has gen­er­at­ed north of $300M in pay­ments across the up­front, mile­stones, and roy­al­ties – af­ter spend­ing less than $18M in eq­ui­ty cap­i­tal,” Booth writes in a blog­post. “A su­perb ven­ture re­turn.”

Booth adds that part­ner­ing with roy­al­ty port­fo­lio firms like Roy­al­ty Phar­ma was al­ways the plan “giv­en the tem­po­ral chal­lenge of a closed-end time-lim­it­ed ven­ture fund and the long tail of fu­ture roy­al­ty pay­ments.”

Dave Grayzel

Em­gal­i­ty was the third CGRP in­jectable to join the mi­graine pre­ven­tion par­ty, fol­low­ing af­ter Am­gen/No­var­tis’ Aimovig and Te­va’s Ajovy. But un­like its ri­vals and an­a­lysts, who have con­ced­ed that da­ta un­der­ly­ing the three prod­ucts are large­ly sim­i­lar, Lil­ly made the case that its me-too drug was in fact a touch above the rest, and its sales strat­e­gy would do the rest.

De­spite some­what dis­ap­point­ing sales of $5 mil­lion in the three months in 2018, Eval­u­atePhar­ma is fore­cast­ing 2024 sales of $1.2 bil­lion for Em­gal­i­ty, match­ing Roy­al­ty Phar­ma’s block­buster hopes that the drug will carve out a sub­stan­tial share of the mam­moth mar­ket that ad­dress­es 30 mil­lion Amer­i­cans (worth $5 bil­lion to $6 bil­lion by some es­ti­mates).

Mean­while, Em­gal­i­ty has al­so been grant­ed pri­or­i­ty re­view by the FDA to pre­vent episod­ic clus­ter headaches in adults, an un­der-rec­og­nized and of­ten mis­di­ag­nosed dis­or­der that has no FDA-ap­proved pre­ven­ta­tive treat­ments so far.

In­side Track: Be­hind the Scenes of a Ma­jor Biotech SPAC

Dr. David Hung and Michelle Doig are no strangers to the SPAC phenomenon. As Founder and CEO of Nuvation Bio, a biotech company tackling some of the greatest unmet needs in oncology, Dr. Hung recently took the company public in one of this year’s biggest SPAC related deals. And as Partner at Omega Funds, Doig not only led and syndicated Nuvation Bio’s Series A, but is now also President of the newly formed, Omega-sponsored, Omega Alpha SPAC (Nasdaq: OMEG; oversubscribed $138m IPO priced January 6, 2021).

Aduhelm OK 'bit­ter­sweet' for ALS ad­vo­cates; Con­trast­ing Covid-19 vac­cine read­outs; GSK joins TIG­IT bat­tle; 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.

With the busiest days of June now behind us, we’re starting to think seriously about the second half of the year. In August, we have scheduled a special report where Endpoints will compile a list of the 20 most influential R&D executives in biopharma. Know a luminary who should definitely be included? Nominate them now.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 109,800+ biopharma pros reading Endpoints daily — and it's free.

Who are the lu­mi­nar­ies dri­ving the biggest ad­vances in bio­phar­ma R&D? End­points News is ask­ing for your nom­i­na­tions for a spe­cial re­port

In biopharma, driving a drug to market is the ultimate goal — but none of that happens without a strong research and development program. At the most successful companies, those R&D efforts are spearheaded by true innovators in the field who are always looking for that next novel mechanism of action or breakthrough safety profile.

Now, Endpoints News is asking you to tell us who those guiding lights are.

Leen Kawas, Athira CEO

Biotech founder placed on leave as $400M Alzheimer's start­up idea comes un­der scruti­ny

Athira Pharma, the Alzheimer’s biotech that emerged out of obscurity last year and raised nearly $400 million for a dark-horse approach to treating neurodegeneration, has found itself in sudden turmoil.

On Tuesday evening, the company released a terse statement announcing that CEO and founder Leen Kawas had been placed on administrative leave while an independent review board investigated “actions stemming” from her doctoral research at Washington State University. Mark Litton, who joined the company as COO two years ago, will take over day-to-day operations, they said.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 109,800+ biopharma pros reading Endpoints daily — and it's free.

Bris­tol My­ers breaks the bank on Ei­sai's fo­late re­cep­tor ADC drug, lay­ing out more than $3B+ for rights

For years, innovation in oncology has been a crapshoot with Big Pharma — the whales at the table — dropping the big bucks for the key to the next generation of tumor fighters. Bristol Myers Squibb hasn’t exactly made a name for being an innovator in the space, but that doesn’t mean it won’t splash in when it sees a potential winner.

Now, with a massive check in hand, the drugmaker is willing to put its intuition to the test.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 109,800+ biopharma pros reading Endpoints daily — and it's free.

Michael Chambers (L) and John Ballantyne

Dana­her strikes deal to buy boom­ing next-gen man­u­fac­tur­er Alde­vron for $9.6B

Life sciences conglomerate Danaher Corp. $DHR has struck a deal to buy the fast-growing Aldevron, one of the world’s top manufacturers of hotly sought-after plasmid DNA, mRNA and recombinant proteins for the burgeoning world of vaccine and drugmakers pushing some game-changing technologies.

Buyout talks set the stage for Danaher to settle on a $9.6 billion cash pact to acquire the private Fargo, ND-based company — a key supplier for a disruptive new Covid vaccine as well as a host of gene and cell therapy and CRISPR gene editing players — founded by Michael Chambers and CSO John Ballantyne as a crew of 2 back in 1998.

Endpoints Premium

Premium subscription required

Unlock this article along with other benefits by subscribing to one of our paid plans.

FDA's con­tro­ver­sial Aduhelm de­ci­sion leaves ALS pa­tients feel­ing spurned

The FDA’s controversial approval of Biogen’s Aduhelm drug for Alzheimer’s disease has been met with fierce resistance from all corners of the biopharma industry, but few seem to be as upset with the decision as ALS patients and advocacy groups.

For all that’s already been written and discussed about the agency’s announcement, from the drug’s exorbitantly high price of $56,000 per year to criticism over lowered standards, ALS patients see something more. ALS patients and associations say they largely regarded Aduhelm’s approval as a bittersweet double standard: happy that those with Alzheimer’s have a new drug available, but questioning how the FDA evaluated Biogen’s drug compared to the experimental programs being studied for their own disease.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 109,800+ biopharma pros reading Endpoints daily — and it's free.

As drug­mak­ers spend $6B an­nu­al­ly on DTC ads, sen­a­tors re­vive bill to in­clude list prices in ads

A new GAO report on biopharma companies’ $6 billion annual spending on direct-to-consumer advertising is pushing US Senate Majority Whip Dick Durbin (D-IL) and Sen. Chuck Grassley (R-IA) to reintroduce legislation that would require price disclosures in the ads.

The GAO found that drugmakers spent almost half—$8.2 billion of the $17.8 billion from 2016 to 2018—on DTC ads for drugs in three therapeutic categories, including inflammatory conditions (e.g., arthritis, gout), endocrine and metabolic disorders (e.g., type 2 diabetes, hypothyroidism), and conditions affecting the central nervous system (e.g., depression, multiple sclerosis), according to the new report.

Med­ic­aid com­mis­sion to Con­gress: In­crease re­bates for ac­cel­er­at­ed ap­proval drugs

As the FDA continues to approve more new drugs under its accelerated approval pathway, the non-partisan Medicaid and CHIP Payment and Access Commission (MACPAC) is telling Congress to increase the statutory Medicaid rebates for such drugs until their clinical benefits have been verified.

Higher rebates for drugs with accelerated approvals, a move opposed by the biopharma industry, would mean lower net prices, lessening their financial burden on the health care system while incentivizing the companies to speed the verification of the drugs’ clinical benefits in confirmatory trials. Once those benefits are confirmed, the companies would return to the lower rebates when the accelerated approval is converted into a full approval, MACPAC suggests.