Bear mar­ket hits an­oth­er biotech as Red­Hill Bio­phar­ma lays off a third of US sales­force

As the biotech bear mar­ket con­tin­ues its re­lent­less beat­down of the sec­tor, an­oth­er com­pa­ny is feel­ing the heat and lay­ing off staff.

The Is­raeli/North Car­oli­na-based Red­Hill Bio­phar­ma will trim its US com­mer­cial staff by one-third, the com­pa­ny an­nounced Thurs­day af­ter­noon, as part of a plan to try to save $50 mil­lion over the next 18 months. Red­Hill re­port­ed the lay­offs as part of its first quar­ter up­date, and said the move would bring its US sales­force back to pre-pan­dem­ic lev­els.

Dror Ben-Ash­er

CEO Dror Ben-Ash­er al­so not­ed the biotech is in dis­cus­sions to ac­quire an undis­closed, FDA-ap­proved GI drug to help bring in more cash.

“To ad­dress the cur­rent mar­ket re­al­i­ties and op­er­at­ing land­scape, Red­Hill is be­ing de­ci­sive about con­trol­ling its own des­tiny and is high­ly fo­cused on achiev­ing ear­li­er prof­itabil­i­ty,” Ben-Ash­er said in a state­ment.

It’s not clear how the sales lay­offs might af­fect Red­Hill’s busi­ness, giv­en the biotech al­ready has three ap­proved drugs. The com­pa­ny said Thurs­day its net rev­enues were $18.2 mil­lion in the first quar­ter, down from $22.1 mil­lion in 2021’s fourth quar­ter. Red­Hill at­trib­uted the down­swing to “typ­i­cal cycli­cal trends” for its painkiller-in­duced con­sti­pa­tion drug Movan­tik.

But like the rest of the in­dus­try, Red­Hill has been feel­ing the pain in its stock price. Com­pa­ny shares $RDHL are down al­most 90% over the last 12 months, as of Thurs­day’s clos­ing price of 77 cents apiece.

Red­Hill is far from the first biotech to en­gage in such cost-cut­ting mea­sures dur­ing the bear mar­ket. Biotechs big and small have had to cut back, whether through trim­ming the pipeline or re­duc­ing head­counts. An­oth­er hand­ful have shak­en up their C-suites, try­ing to get fresh starts at the top and hop­ing suc­cess will fol­low.

Though the mar­ket has been rough the last year and a half, biotech may be see­ing a small respite. The XBI, an in­dex wide­ly seen as the sec­tor’s barom­e­ter, is up near­ly 20% over the last week. Whether or not this is the start of a trend, or mere­ly a blip in the radar, re­mains to be seen, how­ev­er, as the XBI is still low­er than where it stood in Jan­u­ary 2020.

Biotech in­vestors and CEOs see two paths to growth, but are they equal­ly vi­able?

The dynamic in the biotech market has been highly volatile in the last few years, from the high peaks immediately after the COVID vaccine in 2021, to the lowest downturns of the last 20 years in 2022. This uncertainty makes calling the exact timing of the market’s turn something of a fool’s errand, according to Dr. Chen Yu, Founder and Managing Partner of TCG Crossover (TCG X). He speaks with RBC’s Noël Brown, Head of US Biotechnology Investment Banking, about the market’s road ahead and two possible paths for growth.

Dave Marek, Myovant CEO

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Sumitomo is bidding $22.75 a share for the outstanding stock, which now represents 48% of the company after Sumitomo bumped its ownership since the original deal with Roivant. Myovant, however, created a special committee on the board, and they’re shaking their heads over the offer.

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Justin Klee (L) and Joshua Cohen, Amylyx co-CEOs (Cody O'Loughlin/The New York Times; courtesy Amylyx)

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In an investor call Friday morning, Amylyx revealed that it would charge about $158,000 per year, a price point that immediately drew backlash from ALS advocates and some outside observers. The cost reveal had been highly anticipated in the immediate hours after Thursday evening’s approval, though Amylyx only teased Relyvrio would cost less than previously approved drugs.

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Albert Bourla, Pfizer CEO (Gian Ehrenzeller/Keystone via AP)

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The draft is the third in a series of four patient-focused drug development guidance documents that the FDA had to create as part of the 21st Century Cures Act, and they describe how stakeholders (patients, caregivers, researchers, medical product developers and others) can collect and submit patient experience data and other relevant information for medical product development and regulatory decision-making.

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Severin Schwan, outgoing Roche CEO (via Getty Images)

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Matt Sause, who currently leads Roche’s North American diagnostics business, is popping the cork on the big global promotion to take effect on March 15. The 20-year Roche veteran has served a handful of roles across the company’s diagnostics and pharma units, including a stint at Genentech where he was lifecycle leader for blockbuster Tecentriq’s head and neck cancer programs.

Will Lewis, Insmed CEO

In­smed plots up­com­ing med launch­es built on its first drug lessons and con­sumer play­book mar­ket­ing strate­gies

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For CEO Will Lewis, that means tapping consumer insights as early as possible and developing products and packaging that are intuitive and easy to use. It also means translating those patient experiences into creative and atypical biopharma marketing, and in both cases, taking a page from consumer marketers’ playbooks.

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FTC chair Lina Khan with National Community Pharmacists Association CEO Douglas Hoey (NCPA via Twitter)

FTC chair Lina Khan pledges to use all tools to in­ves­ti­gate PBMs

KANSAS CITY, Mo. — Pharmacy benefit managers have become a thorn in the side of the pharma and insurance industries in recent years, and just a couple of months after the Federal Trade Commission signaled it would investigate unlawful PBM practices, FTC chair Lina Khan is looking to turn up the heat even more.

Khan sat down with National Community Pharmacists Association CEO Douglas Hoey on Monday morning at the NCPA’s annual convention, with a fireside chat in the heart of the Midwest.

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Rob Etherington, Clene CEO

Star­tup's gold nanocrys­tal ALS drug flops a PhII tri­al, a re­minder of the dis­ease's ob­sta­cles de­spite Amy­lyx OK

Despite the FDA approving an ALS drug for the first time in five years last week, the disease continues to fluster researchers, and another biotech is feeling the pain of a mid-stage failure.

Clene Nanomedicine reported early Monday that its ALS program, which uses gold nanocrystals to try to catalyze intracellular reactions, did not achieve its Phase II primary or secondary endpoints. And in a press release, the company noted for the first time that it’s speaking with “potential strategic partners” about the program — language that typically indicates a biotech is preparing to sell off an asset.

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