Drown­ing in lit­i­ga­tion, Mallinck­rodt be­comes third opi­oid pro­duc­er to file for bank­rupt­cy

Be­set by hun­dreds of opi­oid law­suits and hun­dreds of mil­lions in pay­ments owed un­der a re­cent fed­er­al rul­ing on one of their best-sell­ing drugs, Mallinck­rodt, the 150-year-old Irish drug­mak­er, has filed for Chap­ter 11 bank­rupt­cy.

Mallinck­rodt, a com­pa­ny that once sold more opi­oids in the US than any oth­er, be­comes the third ma­jor opi­oid pro­duc­er to file for bank­rupt­cy amid a sea of lit­i­ga­tion. Pur­due Phar­ma and In­sys Ther­a­peu­tics each filed for bank­rupt­cy last year.

Bank­rupt­cy has be­come a com­mon tac­tic for the com­pa­nies that prof­it­ed off the opi­oid epi­dem­ic and now face thou­sands of law­suits in part, crit­ics say, be­cause it can freeze lit­i­ga­tion and leave those lit­i­gants com­pet­ing for pay­outs with a com­pa­ny’s cred­i­tors. Mallinck­rodt said they plan to con­tin­ue with a ten­ta­tive set­tle­ment they reached ear­li­er this year.

Ru­mors of a Mallinck­rodt bank­rupt­cy have swirled for months. In Feb­ru­ary, the drug­mak­er agreed to a set­tle­ment with most of its lit­i­gants, in­clud­ing 47 states and US ter­ri­to­ries, that would see it pay $1.6 bil­lion to re­solve claims over its role in the opi­oid cri­sis.

In March, though, a fed­er­al court found Mallinck­rodt li­able for over $600 mil­lion in un­paid Med­ic­aid re­bates for its top-sell­ing mul­ti­ple scle­ro­sis drug Ac­thar Gel. In sub­se­quent court fil­ings and state­ments, the com­pa­ny said that the rul­ing jeop­ar­dized their abil­i­ty to pay off the opi­oid set­tle­ment, warn­ing in June they may “have no op­tion but to take dras­tic and painful mea­sures, up to and in­clud­ing the prospect of bank­rupt­cy.”

The com­pa­ny said to­day they’ve agreed to pay $260 mil­lion to set­tle Med­ic­aid claims and that they plan to pro­ceed with the $1.6 bil­lion opi­oid set­tle­ment, pay­ing out the lat­ter over 8 years, be­gin­ning with a $450 mil­lion pay­out when they emerge from bank­rupt­cy. The par­ties in the law­suit will al­so re­ceive shares worth about 20% of the com­pa­ny.

Mallinck­rodt list­ed be­tween $1 and $10 bil­lion in as­sets and li­a­bil­i­ties. They are hop­ing to pare down their debt by $1.3 bil­lion.

Un­like Pur­due, which is at­tempt­ing to re-emerge post-bank­rupt­cy as a pro­duc­er of an­ti-ad­dic­tion drugs, Mallinck­rodt in­tends to con­tin­ue de­vel­op­ing new com­pounds dur­ing and post-bank­rupt­cy. Its pipeline, how­ev­er, has been less than ro­bust in re­cent years. Their lead ex­per­i­men­tal com­pound, the rare kid­ney dis­ease drug Ter­li­pressin, was re­ject­ed by the FDA for a sec­ond time last month, af­ter an in­ter­nal re­view spot­light­ed safe­ty con­cerns and lin­ger­ing ques­tions over whether the drug was ef­fec­tive.

Da­ta Lit­er­a­cy: The Foun­da­tion for Mod­ern Tri­al Ex­e­cu­tion

In 2016, the International Council for Harmonisation (ICH) updated their “Guidelines for Good Clinical Practice.” One key shift was a mandate to implement a risk-based quality management system throughout all stages of a clinical trial, and to take a systematic, prioritized, risk-based approach to clinical trial monitoring—on-site monitoring, remote monitoring, or any combination thereof.

Pfiz­er's big block­buster Xel­janz flunks its post-mar­ket­ing safe­ty study, re­new­ing harsh ques­tions for JAK class

When the FDA approved Pfizer’s JAK inhibitor Xeljanz for rheumatoid arthritis in 2012, they slapped on a black box warning for a laundry list of adverse events and required the New York drugmaker to run a long-term safety study.

That study has since become a consistent headache for Pfizer and their blockbuster molecule. Last year, Pfizer dropped the entire high dose cohort after an independent monitoring board found more patients died in that group than in the low dose arm or a control arm of patients who received one of two TNF inhibitors, Enbrel or Humira.

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Steve Harr (L) and Hans Bishop

One of the most am­bi­tious start­up teams in biotech just out­lined plans for a $400M IPO and a val­u­a­tion of about $4B

The executive team at Sana Biotechnology has sketched out more details about the full scope of its ambitions as the new unicorn to watch. They amended their S-1 today to include a price range of $20 to $23 a share — which puts them in reach of pulling in around $400 million on the high end with a market value starting right around $4 billion.

That’s not bad for a preclinical biotech with no drugs yet in human studies, but it squares with its ambitions to remake the cell therapy field with a slate of in-house platforms. The biotech raised $705 million — primarily from ARCH (44 million shares) and Flagship (34.2 million shares) — to get to this stage.

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Lil­ly at­tempts to re­vive an old idea for tack­ling pain, li­cens­ing PhI pro­gram from Japan’s Asahi Ka­sei Phar­ma

Eli Lilly is fronting some new cash in a space they’re quite familiar with.

The company is partnering with Japan’s Asahi Kasei Pharma on an experimental drug for chronic pain, acquiring the rights for the P2X7 receptor antagonist program dubbed AK1780. Lilly will shell out a pretty penny for the program, promising up to $410 million total should each milestone payment come to pass.

Asahi Kasei will receive an upfront sum of $20 million for the candidate. In addition, Lilly is on the hook for up to $210 million in development and regulatory milestones and another potential $180 million in sales milestones. Asahi Kasei can also obtain royalties ranging from the mid-single to low-double digits should an approved product come out of the deal.

Ther­mo Fish­er plat­form seeks to ex­pe­dite donor cell cul­ti­va­tion for al­lo­gene­ic cell ther­a­pies

One of the world’s leading CDMOs has launched a new technology it says will expedite a quickly-growing sect of biotech drug development: off-the-shelf, allogeneic cell therapies.

It’s been nearly a decade since the FDA approved the first use of the method that uses healthy donor cells to create a master cell bank, which is then used for specific therapies — a cord blood allogeneic treatment called Hemacord. In the years since, the use of allogeneic cells has taken off in research circles, most notably in the use of T cell therapies to target solid tumor cancers.

Bob Nelsen (Michael Kovac/Getty Images)

ARCH an­nounces largest fund yet, rais­ing $1.85B to back men­tal health, cell and gene edit­ing ap­proach­es

Nearly a year ago, as the pandemic encroached and the stock market cratered, Flagship and ARCH Venture announced three mega-funds worth a combined $2.6 billion. They wanted, ARCH’s Bob Nelsen said, to restore confidence “that there was money out there and a lot of it” to invest in biotech.

Since then, the stock market has returned — almost frighteningly so — and Nelsen has kept raising and spending cash. On Thursday, he announced a new fund, worth $1.85 billion. It’s the largest pot yet for a VC famous for its deep pockets.

Top gene ther­a­py deals, M&A pacts in 2020 high­light an­oth­er big year in one of the hottest fields in bio­phar­ma

Chris Dokomajilar at DealForma has been crunching the numbers on gene therapy deals over the last 2 years and came away with a few key observations.

Both the upfront cash and deal totals last year backed off a bit from the record high hit in 2019, but the totals are still running well ahead of anything we’ve seen in the years prior to 2019/2020.
2020 R&D partnerships came in at 23 deals, with $1.1 billion in disclosed upfront cash and equity and more than $8.5 billion in total deal value. Looking at 2019-2020 M&A, Dokomajilar found: 9 Acquisitions, with over $11.1 billion in disclosed upfront cash and equity and more than $13.4 billion in total M&A value.

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Covid-19 roundup: EU and As­traZeneca trade blows over slow­downs; Un­usu­al unions pop up to test an­ti­bod­ies, vac­cines

After coming under fire for manufacturing delays last week, AstraZeneca’s feud with the European Union has spilled into the open.

The bloc accused the pharma giant on Wednesday of pulling out of a meeting to discuss cuts to its vaccine supplies, the AP reported. AstraZeneca denied the reports, saying it still planned on attending the discussion.

Early Wednesday, an EU Commission spokeswoman said that “the representative of AstraZeneca had announced this morning, had informed us this morning that their participation is not confirmed, is not happening.” But an AstraZeneca spokesperson later called the reports “not accurate.”

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Janet Woodcock (AP Images)

Ad­vo­ca­cy groups don't want Janet Wood­cock to head the FDA, blast­ing ‘reg­u­la­to­ry fail­ures’ in opi­oid cri­sis

It turns out the controversies around Janet Woodcock’s regulatory legacy weren’t limited to Sarepta’s eteplirsen.

A coalition of advocacy groups dedicated to the opioid crisis urged Norris Cochran and Xavier Becerra — the acting and designated HHS secretary, respectively — to keep her reign as interim FDA chief a “very short transition.” During her lengthy tenure as CDER, they add, Woodcock presided over “one of the worst regulatory agency failures in U.S. history.”

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