Bio­gen lays out a plan to “stream­line” ops, add $400M to fund neu­ro­sciences R&D, new deals

Bio­gen saw its share price $BI­IB pop up more than 5% Tues­day morn­ing as the com­pa­ny re­port­ed sharply high­er rev­enue for Spin­raza, in­di­cat­ing that they have a ma­jor com­mer­cial hit on their hands. And CEO Michel Vounatsos is seiz­ing the mo­ment, out­lin­ing plans to in­vest hun­dreds of mil­lions more each year in its neu­ro­sciences R&D work as he plans to ful­fill a vow to make Bio­gen the lead­ing com­pa­ny in the field. Those plans in­clude late-stage ac­qui­si­tions and “deals of all sizes.”

Michel Vounatsos, Bio­gen

To do that, Bio­gen said that it plans to “stream­line” op­er­a­tions — usu­al­ly code for lay­offs, which is a tac­tic that Bio­gen em­ploys reg­u­lar­ly — with a plan to boost “pri­or­i­tized R&D and com­mer­cial val­ue cre­ation op­por­tu­ni­ties” by $400 mil­lion a year by 2019.

This strat­e­gy will re­ly on see­ing the busi­ness de­vel­op­ment team get busy on deals, some­thing an­a­lysts have been wait­ing for now for more than a year.

Here’s the pledge:

Bio­gen’s new pri­or­i­ty for cap­i­tal de­ploy­ment is to in­vest in build­ing its pipeline through in­creased busi­ness de­vel­op­ment ac­tiv­i­ty. The Com­pa­ny con­tin­ues to fo­cus on max­i­miz­ing long-term share­hold­er val­ue cre­ation, and aims to de­ploy cap­i­tal to gen­er­ate re­turns mean­ing­ful­ly above its cost of cap­i­tal. Bio­gen views in­vest­ment in growth as its top pri­or­i­ty, but al­so rec­og­nizes the val­ue of op­por­tunis­ti­cal­ly re­turn­ing ex­cess cap­i­tal to share­hold­ers through share re­pur­chas­es.

“We will ex­plore deals of all sizes and will re­main dis­ci­plined about our ap­proach,” Vounatsos told an­a­lysts in the morn­ing call. And the ex­ec­u­tive team un­der­scored that the com­pa­ny plans to add late-stage as­sets to the pipeline, un­der­scor­ing their will­ing­ness to spend big.

Bio­gen has done deals over the past year, but a num­ber of an­a­lysts have com­plained that they haven’t seen the com­pa­ny get down to busi­ness in earnest. Vounatsos took over as CEO in that en­vi­ron­ment at the be­gin­ning of the year, af­ter a long stretch with George Scan­gos at the helm. Case in point, Ge­of­frey Porges not­ed at JP Mor­gan in Jan­u­ary that:

Bio­gen has one of the clean­est bal­ance sheets in large cap biotech­nol­o­gy and could af­ford to take on lever­age for mean­ing­ful neu­ro­science M&A deals.

Bio­gen has a big fo­cus on new Alzheimer’s drugs, pur­su­ing a piv­otal pro­gram for ad­u­canum­ab as well as bag­ging an an­ti-tau an­ti­body from Bris­tol-My­ers Squibb last month in a $360 mil­lion deal.

The ques­tion now is whether Bio­gen plans a string of new deals or a ma­jor, trans­for­ma­tion­al buy­out, the kind of M&A that the in­vest­ment com­mu­ni­ty has been lust­ing to see.

Norbert Bischofberger. Kronos

Backed by some of the biggest names in biotech, Nor­bert Bischof­berg­er gets his megaround for plat­form tech out of MIT

A little over a year ago when I reported on Norbert Bischofberger’s jump from the CSO job at giant Gilead to a tiny upstart called Kronos, I noted that with his connections in biotech finance, that $18 million launch round he was starting off with could just as easily have been $100 million or more.

With his first anniversary now behind him, Bischofberger has that mega-round in the bank.

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Francesco De Rubertis

Medicxi is rolling out its biggest fund ever to back Eu­rope's top 'sci­en­tists with strange ideas'

Francesco De Rubertis built Medicxi to be the kind of biotech venture player he would have liked to have known back when he was a full time scientist.

“When I was a scientist 20 years ago I would have loved Medicxi,’ the co-founder tells me. It’s the kind of place run by and for investigators, what the Medicxi partner calls “scientists with strange ideas — a platform for the drug hunter and scientific entrepreneur. That’s what I wanted when I was a scientist.”

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Af­ter a decade, Vi­iV CSO John Pot­tage says it's time to step down — and he's hand­ing the job to long­time col­league Kim Smith

ViiV Healthcare has always been something unique in the global drug industry.

Owned by GlaxoSmithKline and Pfizer — with GSK in the lead as majority owner — it was created 10 years ago in a time of deep turmoil for the field as something independent of the pharma giants, but with access to lots of infrastructural support on demand. While R&D at the mother ship inside GSK was souring, a razor-focused ViiV provided a rare bright spot, challenging Gilead on a lucrative front in delivering new combinations that require fewer therapies with a more easily tolerated regimen.

They kept a massive number of people alive who would otherwise have been facing a death sentence. And they made money.

And throughout, John Pottage has been the chief scientific and chief medical officer.

Until now.

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Chas­ing Roche's ag­ing block­buster fran­chise, Am­gen/Al­ler­gan roll out Avastin, Her­ceptin knock­offs at dis­count

Let the long battle for biosimilars in the cancer space begin.

Amgen has launched its Avastin and Herceptin copycats — licensed from the predecessors of Allergan — almost two years after the FDA had stamped its approval on Mvasi (bevacizumab-awwb) and three months after the Kanjinti OK (trastuzumab-anns). While the biotech had been fielding biosimilars in Europe, this marks their first foray in the US — and the first oncology biosimilars in the country.

Seer adds ex-FDA chief Mark Mc­Clel­lan to the board; Her­cules Cap­i­tal makes it of­fi­cial for new CEO Scott Bluestein

→ On the same day it announced a $17.5 million Series C, life sciences and health data company Seer unveiled that it had lured former FDA commissioner and ex-CMS administrator Mark McClellan on to its board. “Mark’s deep understanding of the health care ecosystem and visionary insights on policy reform will be crucial in informing our thinking as we work to bring our liquid biopsy and life sciences products to market,” said Seer chief and founder Omid Farokhzad in a statement.

Daniel O'Day

No­var­tis hands off 3 pre­clin­i­cal pro­grams to the an­tivi­ral R&D mas­ters at Gilead

Gilead CEO Daniel O’Day’s new task hunting up a CSO for the company isn’t stopping the industry’s dominant antiviral player from doing pipeline deals.

The big biotech today snapped up 3 preclinical antiviral programs from pharma giant Novartis, with drugs promising to treat human rhinovirus, influenza and herpes viruses. We don’t know what the upfront is, but the back end has $291 million in milestones baked in.

Vas Narasimhan, AP Images

On a hot streak, No­var­tis ex­ecs run the odds on their two most im­por­tant PhI­II read­outs. Which is 0.01% more like­ly to suc­ceed?

Novartis CEO Vas Narasimhan is living in the sweet spot right now.

The numbers are running a bit better than expected, the pipeline — which he assembled as development chief — is performing and the stock popped more than 4% on Thursday as the executive team ran through their assessment of Q2 performance.

Year-to-date the stock is up 28%, so the investors will be beaming. Anyone looking for chinks in their armor — and there are plenty giving it a shot — right now focus on payer acceptance of their $2.1 million gene therapy Zolgensma, where it’s early days. And CAR-T continues to underperform, but Novartis doesn’t appear to be suffering from it.

So what could go wrong?

Actually, not much. But Tim Anderson at Wolfe pressed Narasimhan and his development chief John Tsai to pick which of two looming Phase III readouts with blockbuster implication had the better odds of success.

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On a glob­al romp, Boehringer BD team picks up its third R&D al­liance for Ju­ly — this time fo­cused on IPF with $50M up­front

Boehringer Ingelheim’s BD team is on a global deal spree. The German pharma company just wrapped its third deal in 3 weeks, going back to Korea for its latest pipeline pact — this time focused on idiopathic pulmonary fibrosis.

They’re handing over $50 million to get their hands on BBT-877, an ATX inhibitor from Korea’s Bridge Biotherapeutics that was on display at a science conference in Dallas recently. There’s not a whole lot of data to evaluate the prospects here.

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Servi­er scoots out of an­oth­er col­lab­o­ra­tion with Macro­Gen­ics, writ­ing off their $40M

Servier is walking out on a partnership with MacroGenics $MGNX — for the second time.

After the market closed on Wednesday MacroGenics put out word that Servier is severing a deal — inked close to 7 years ago — to collaborate on the development of flotetuzumab and other Dual-Affinity Re-Targeting (DART) drugs in its pipeline.

MacroGenics CEO Scott Koenig shrugged off the departure of Servier, which paid $20 million to kick off the alliance and $20 million to option flotetuzumab — putting a heavily back-ended $1 billion-plus in additional biobuck money on the table for the anti-CD123/CD3 bispecific and its companion therapies.