Déjà vu for Zaf­gen: Still fret­ting about lin­ger­ing car­dio con­cerns, FDA clamps a hold on lead obe­si­ty drug -- shares plunge

Two years af­ter Zaf­gen torched its lead obe­si­ty com­pound fol­low­ing an ug­ly crash in late-stage test­ing that cost lives, the FDA is still fret­ting whether the com­pa­ny is con­tin­u­ing to ex­pose more peo­ple to harm.

The biotech re­port­ed to­day that the FDA has slapped a clin­i­cal hold on their MetAP2 drug ZGN-1061, wor­ried that the car­dio threat posed by their first-gem drug be­lo­ranib might still be in play. They plan to fol­low up with a face-to-face meet­ing, but there’s no clar­i­ty on how long their drug could be in lim­bo now.

In­vestors hat­ed the sound of it. Zaf­gen’s shares cratered, plung­ing 46% short­ly af­ter the mar­ket opened Mon­day.

Zaf­gen’s shares $ZFGN — once over $40 — nev­er re­vived af­ter the plunge that oc­curred in the fall of 2015, when man­age­ment ini­tial­ly stonewalled in­vestors clam­or­ing to find out what had prompt­ed the com­pa­ny to abrupt­ly drop out of a promi­nent in­vest­ment con­fer­ence. Back-to-back deaths, though, along with a clin­i­cal hold that led to a list of re­quire­ments for be­lo­ranib’s clin­i­cal de­vel­op­ment that Zaf­gen de­cid­ed had cre­at­ed a hur­dle too steep to clear, killed that ef­fort.

Ac­cord­ing to their state­ment, Zaf­gen got the lat­est hold let­ter some­time last week.

The FDA cit­ed the pos­si­bil­i­ty of car­dio­vas­cu­lar (CV) safe­ty risk based on the Com­pa­ny’s pri­or com­pound and out­lined mul­ti­ple po­ten­tial paths for mov­ing for­ward, in­clud­ing non­clin­i­cal or clin­i­cal op­tions, to ad­dress these con­cerns in the on­go­ing de­vel­op­ment of ZGN-1061. The Com­pa­ny plans to as­sess these op­tions and re­quest a Type A meet­ing with the Agency to dis­cuss next steps with the pro­gram.

Tom Hugh­es

De­spite the reg­u­la­to­ry con­cerns in the US, Zaf­gen says it plans to sol­dier on with a dose-es­ca­lat­ing Phase II study for ZGN-1061 in Eu­rope, which is be­yond the FDA’s reach.

Like their first drug be­lo­ranib, ZGN-1061 has demon­strat­ed an abil­i­ty to knock off a sig­nif­i­cant amount of weight. But the safe­ty bar for a drug now guid­ed to­ward di­a­betes is clear­ly very high.

Leerink’s Joseph Schwartz had this to say af­ter the news hit:

As we pre­vi­ous­ly high­light­ed in de­tail, pre­clin­i­cal da­ta sug­gests that ZGN-1061 has the po­ten­tial to in­duce clot­ting fac­tors if it is not cleared. De­spite a clean safe­ty re­port card to date in a small Ph.2 study, our main con­cerns have stemmed from lack of dis­clo­sure about how the drug is me­tab­o­lized and cleared, and the po­ten­tial for drug-drug in­ter­ac­tions that could de­lay the drug’s clear­ance when test­ed in a larg­er Ph.3 study of T2D pa­tients, which we be­lieve could have played in­to the FDA’s de­ci­sion. How this de­ci­sion will af­fect the over­all time­line for this pro­gram is un­known, but the com­pa­ny plans on defin­ing a path for­ward with reg­u­la­tors.

Over the last few months Zaf­gen has seen a big change at the top, with Tom Hugh­es leav­ing the com­pa­ny af­ter lead­ing it for 9 years — to take the CEO’s job at Nav­i­tor — just ahead of board mem­ber Bruce Booth. 

Regeneron CEO Leonard Schleifer speaks at a meeting with President Donald Trump, members of the Coronavirus Task Force, and pharmaceutical executives in the Cabinet Room of the White House (AP Photo/Andrew Harnik)

OWS shifts spot­light to drugs to fight Covid-19, hand­ing Re­gen­eron $450M to be­gin large scale man­u­fac­tur­ing in the US

The US government is on a spending spree. And after committing billions to vaccines defense operations are now doling out more of the big bucks through Operation Warp Speed to back a rapid flip of a drug into the market to stop Covid-19 from ravaging patients — possibly inside of 2 months.

The beneficiary this morning is Regeneron, the big biotech engaged in a frenzied race to develop an antibody cocktail called REGN-COV2 that just started a late-stage program to prove its worth in fighting the virus. BARDA and the Department of Defense are awarding Regeneron a $450 million contract to cover bulk delivery of the cocktail starting as early as late summer, with money added for fill/finish and storage activities.

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The home run count: The $100M+ mega-round boom in biotech in­spired a $6.7B feed­ing fren­zy — so far this year

Over the last 6 months there’s been a blizzard of money piling up drifts of the green stuff through the biotech landscape. And the forecast calls for more cash windfalls ahead.

Even as a global pandemic has killed more than half a million people, blighted economies and divided nations over the proper response, it’s also helped ignite an unprecedented burst of big-time investing. And not just in Covid-19 deals, as we’ve looked at before.

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UP­DAT­ED: Bio­gen shares spike as ex­ecs com­plete a de­layed pitch for their con­tro­ver­sial Alzheimer's drug — the next move be­longs to the FDA

Biogen is stepping out onto the high wire today, reporting that the team working on the controversial Alzheimer’s drug aducanumab has now completed their submission to the FDA. And they want the agency to bless it with a priority review that would cut the agency’s decision-making time to a mere 6 months.

The news drove a 10% spike in Biogen’s stock $BIIB ahead of the bell.

Part of that spike can be attributed to a relief rally. Biogen execs rattled backers and a host of analysts earlier in the year when they unexpectedly delayed their filing to the third quarter. That delay provoked all manner of speculation after CEO Michel Vounatsos and R&D chief Al Sandrock failed to persuade influential observers that the pandemic and other factors had slowed the timeline for filing. Actually making the pitch at least satisfies skeptics that the FDA was not likely pushing back as Biogen was pushing in. From the start, Biogen execs claimed that they were doing everything in cooperation with the FDA, saying that regulators had signaled their interest in reviewing the submission.

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Atul Deshpande, Harbour BioMed chief strategy officer & head, US operations (Harbour BioMed)

An­oth­er biotech IPO set-up? Multi­na­tion­al biotech leaps from round to round, scoop­ing up cash at a blis­ter­ing pace

A short four months after announcing a $75 million haul in Series B+ fundraising, the multinational biotech Harbour BioMed pulled in another round of investments and eclipsed the nine-digit mark in the process.

Harbour completed its Series C financing, the company announced Thursday morning, raising $102.8 million and bringing its total investment sum to over $300 million since its founding in late 2016. The biotech plans to use the money to transition early-stage candidates from the discovery phase, fund candidates already in the clinic, and prep late-stage candidates for commercialization.

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For­bion spot­lights late-stage plays, carves out new €250M growth fund

Having staked its rep on picking out a mix of biotech investment opportunities across the “build,” “enable,” “growth” continuum, Forbion is launching its first fund dedicated to late-stage opportunities.

Forbion Growth Opportunities Fund’s first close brought in €185 million ($208 million). Existing investors Pantheon, KfW Capital and the European Investment Fund came on board, joined by new backers Eli Lilly, Horizon Therapeutics, Belgian Growth Fund and New Waves Investments.

Mer­ck ex­pands scope of Zymeworks an­ti­body al­liance, adding close to $900M in mile­stones

Nearly a decade after first partnering with Merck, Vancouver-based biotech Zymeworks has expanded its collaboration with the pharma giant once again.

Zymeworks re-upped with Merck in a new licensing agreement, granting the New Jersey pharma giant the right to develop up to 3 additional multispecific antibody candidates. In exchange, the biotech will receive an undisclosed upfront payment — Merck is always loath to discuss cash terms — and nearly $900 million in combined regulatory ($411 million) and commercial ($480 million) milestones.

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Daniel O'Day, Gilead CEO (Kevin Dietsch/UPI/Bloomberg via Getty Images)

A new study points to $6.5B in pub­lic sup­port build­ing the sci­en­tif­ic foun­da­tion of Gilead­'s remde­sivir. Should that be re­flect­ed in the price?

By drug R&D standards, Gilead’s move to repurpose remdesivir for Covid-19 and grab an emergency use authorization was a remarkably easy, low-cost layup that required modest efficacy and a clean safety profile from just a small group of patients.

The drug OK also arrived after Gilead had paid much of the freight on getting it positioned to move fast.

In a study by Fred Ledley, director of the Center for Integration of Science and Industry at Bentley University in Waltham, MA, researchers concluded that the NIH had invested only $46.5 million in the research devoted to the drug ahead of the pandemic, a small sum compared to the more than $1 billion Gilead expected to spend getting it out this year, all on top of what it had already cost in R&D expenses.

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Ed Engleman (Stanford Blood Center)

Stan­ford star on­col­o­gy sci­en­tist Ed En­gle­man helped cre­ate the im­munother­a­py field. Now he wants to shake up neu­rode­gen­er­a­tion R&D

Over the last generation of drug R&D, Ed Engleman has been a standout scientist.

The Stanford professor co-founded Dendreon and provided the scientific insights needed to develop Provenge into a pioneering — though not particularly marketable — immunotherapy. He’s spurred a slate of startups, assisted by his well-connected perch as a co-founder of Vivo Capital, and took the dendritic cell story into its next chapter at a startup called Bolt.

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Nello Mainolfi (Kymera via YouTube)

Out to re­vive R&D, a resur­gent Sanofi pays $150M cash to part­ner up with a pi­o­neer­ing pro­tein degra­da­tion play­er

Frank Nestle was appointed Sanofi’s global head of immunology and inflammation research therapeutic area just days before dupilumab, the blockbuster-to-be IL-4 antibody, would be accepted for priority review. After four years of consolidating immunology expertise from multiple corners of the Sanofi family and recruiting new talents to build the discovery engine, he’s set eyes on a Phase I-ready program that he believes can grow into a Dupixent-sized franchise.