Clarus read­ies a slate of big PhI­II risk-shar­ing bets with a new $910M fund

About 8 years ago, the crew at Clarus Ven­tures had a sit down with a phar­ma com­pa­ny they were look­ing to sell one of their port­fo­lio biotechs to. The talks went well, the com­pa­ny want­ed the as­sets. But there was a big ob­sta­cle.

The buy­er they were talk­ing to couldn’t af­ford to just ac­quire the com­pa­ny and fit in an­oth­er late-stage drug pro­gram un­der its R&D bud­get. Those num­bers couldn’t change willy nil­ly — no mat­ter how good the new late-stage drug looked.

So Clarus got cre­ative. They agreed to come in with fund­ing for the Phase III, work­ing a deal on their pay­back for tak­ing on the risk. That cre­ative deal be­came a busi­ness at Clarus, and a good one at that, to hear them tell the sto­ry. They fol­lowed up with a string of deals with a line­up of top-20 phar­mas and now Clarus has raised $910 mil­lion more to fund the next wave.

“Over the past 7 years, half of our in­vest­ment strat­e­gy has been fo­cused on risk shar­ing,” Clarus Man­ag­ing Di­rec­tor Nick Galakatos tells me. Clarus IV — which broke well past its ini­tial $750 mil­lion goal — will al­low them to grow these kinds of struc­tured in­vest­ments past the top 20 with enough cash to fund rough­ly 12 to 14 more deals at $50 mil­lion to $300 mil­lion apiece.

This is a far cry from the clas­sic kind of ven­ture in­vest­ments that VCs make in life sci­ences. And Galakatos says it’s the kind of deal that should do well in the cur­rent re­strict­ed fi­nan­cial en­vi­ron­ment that phar­mas have to work with.

“For the most part the R&D bud­get of the ma­jor phar­ma com­pa­nies is con­strained,” says Galakatos. “They have a very ex­cit­ing pipeline and frankly they can­not fund their ex­ist­ing bud­get.” The risk-shar­ing deals pro­vide the added cash for the phar­mas to take more shots on goal, and there’s sub­stan­tial Phase II da­ta for Clarus to con­sid­er be­fore mak­ing a bet.

Not too sur­pris­ing­ly, can­cer deals are at the heart of this strat­e­gy, with red-hot im­muno-on­col­o­gy pacts as the cen­ter­piece. Phar­ma com­pa­nies in gen­er­al are loathe to pub­licly de­tail the num­bers be­hind deals like this and Galakatos knows the val­ue of re­main­ing dis­crete.

But he did of­fer that Clarus worked one struc­tured deal on ibru­ti­nib that was un­veiled, buy­ing a roy­al­ty stream from Roy­al­ty Phar­ma along­side Ais­ling Cap­i­tal when that drug was un­der re­view in 2013 by J&J and Phar­ma­cyclics. And of the 8 drugs they fi­nanced that made it through Phase III, he says, 5 are ap­proved and 3 more are be­ing po­si­tioned for a reg­u­la­to­ry de­ci­sion.

Clarus is ready for more.

UP­DAT­ED: Roche bags 'break­through' an­ti-fi­bro­sis drug in $1.4B biotech buy­out deal

Roche is snapping up a “breakthrough” anti-fibrotic drug in a $1.4 billion buyout.

The pharma giant announced Friday that it is acquiring Promedior, primarily to get its hands on PRM-151, a recombinant form of human pentraxin-2 (PTX-2) protein that has nailed down mid-stage clinical data on idiopathic pulmonary fibrosis and demonstrating its potential for a range of fibrotic conditions.

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Amarin emerges from an ex­pert pan­el re­view with a clear en­dorse­ment for Vas­cepa and high odds of suc­cess when the FDA weighs in for­mal­ly

Several FDA experts who gathered Thursday to consider the landmark approval of Vascepa to reduce cardio events in an at-risk population voiced their unease about various aspects of the efficacy and safety data, or ultimately the population it should be used to treat. But the overwhelming belief that the data pointed to the drug’s benefit and clearly outweighed risks carried the day for Amarin.

The panel voted unanimously (16 to 0) to support the company’s positive data presentation — backing an OK for expanding the label to include reducing cardio risk. The vote points Amarin $AMRN down a short path to a formal decision by the FDA, with the odds heavily in its favor. Chances are the rest of the questions about the future of this drug will be hashed out in the label’s small print.

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Federal Trade Commission commissioner Rohit Chopra testifies on Capitol Hill (AP Photo/Susan Walsh)

FTC clears Bris­tol-My­ers’ $74B deal to buy Cel­gene — but Dems sig­nal a po­ten­tial hard shift against Big Phar­ma M&A

Bristol-Myers Squibb’s record $74 billion takeover of Celgene is a done deal. And it will all be over — except for the lingering complaints from die-hard Celgene investors — on Wednesday.

Like much else that’s going on in Washington these days, the vote among the 5 FTC commissioners split along party lines, with the 3 Republicans voting to clear the way and the 2 Democrats steamed over what they see as a major M&A move that will lessen competition and innovation. And that split has big implications for the M&A side of the business if the Dems take the White House in 2020.

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No­var­tis spin­out’s first an­ti-ag­ing PhI­II is a flop, so now they’ll turn to Parkin­son’s chal­lenge as shares wilt

Novartis spinout resTORbio is grappling with the collapse of its lead clinical program this morning — an anti-aging R&D failure that will badly damage their rep in the field.

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BeiGene CEO John Oyler at an Endpoints event in Shanghai, October 2018 (Credit: Endpoints News/PharmCube)

UP­DAT­ED: In a first, FDA green-lights use of a Chi­nese built can­cer ther­a­py — and more are com­ing

Weeks after Amgen took a $2.7 billion stake in BeiGene, the Beijing-based biotech has secured its first-ever FDA approval for zanubrutinib, a BTK inhibitor, months ahead of schedule.

BeiGene’s drug, branded as Brukinsa, has secured accelerated approval for adult patients with mantle cell lymphoma (MCL) — a typically aggressive, rare, form of blood cancer — who have received at least one prior therapy.

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What does $62B buy you these days? A lot, says Take­da ex­ecs as the phar­ma play­er promis­es a block­buster R&D fu­ture

First comes the $62 billion buyout. Then comes the asset auction and reorganization to pay down debt. Now comes the detailed pledge of a bigger, brighter future in drug development.

That’s where Takeda finds itself on R&D day today, about 11 months after closing on their Shire acquisition. R&D chief Andy Plump is joining CEO Christophe Weber and other top members of the team to outline a new set of priorities in the greatly expanded pipeline at Takeda, which has jumped into the top ranks of the world’s pharma giants in the wake of the Shire deal.

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GSK's asth­ma bi­o­log­ic Nu­cala scores in rare blood dis­or­der study

GlaxoSmithKline’s asthma drug Nucala, which received a resounding FDA rejection for use in chronic obstructive pulmonary disease (COPD) last year, has shown promise in a rare blood disorder.

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Mer­ck buys a fledg­ling neu­rode­gen­er­a­tive biotech spawned by an old GSK dis­cov­ery al­liance. What’s up with that?

Avalon Ventures chief Jay Lichter has a well-known yen for drug development programs picked up in academia. And what he found in Haoxing Xu’s lab at the University of Michigan pricked his interest enough to launch one of his umbrella biotechs in San Diego.

Xu’s work laid the foundation for Avalon to launch Calporta, which has been working on finding small molecule agonists of TRPML1 (transient receptor potential cation channel, mucolipin subfamily, member 1) for lysosomal storage disorders. And that pathway, they believe, points to new approaches on major market neurodegenerative diseases like Parkinson’s, ALS and Alzheimer’s.

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No­var­tis scores its lat­est FDA OK — this time for a new sick­le cell dis­ease drug picked up in a $665M deal

Novartis’ decision to buy Oklahoma-based biotech Selexys 3 years ago for up to $665 million has paid off with an FDA approval today.

Blessed with the FDA’s breakthrough drug designation for a speedy review, the pharma giant has pinned down an approval for crizanlizumab, a new therapy designed to reduce the frequency of painful incidents of vaso-occlusive crises among sickle cell disease patients 16 or older.

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