En­do pays $658M in a fur­ther bet on col­la­gen-based med­i­cines, buy­ing out long­time bio­phar­ma part­ner

A lit­tle less than two years af­ter En­do Phar­ma­ceu­ti­cals’ deal to pur­chase Som­er­set Ther­a­peu­tics fell through, the Irish drug­mak­er is re­turn­ing to the well with a much big­ger ac­qui­si­tion.

En­do has agreed to buy BioSpecifics Tech­nolo­gies for a whop­ping $658 mil­lion, the two com­pa­nies an­nounced Mon­day, in the cul­mi­na­tion of a re­search agree­ment signed all the way back in 2004. En­do will pur­chase all of BioSpecifics’ out­stand­ing stock for about $540 mil­lion, valu­ing the com­pa­ny at $88.50 per share — a 45% pre­mi­um on the $61.02 share price at which the com­pa­ny closed on Fri­day.

As the stock mar­ket opened Mon­day, BioSpecifics’ stock $BSTC soared to meet that pre­mi­um while En­do’s shares $ENDP spiked about 7%. The two sides are ex­pect­ed to close the trans­ac­tion be­fore the end of 2020.

Un­der the 2004 agree­ment, BioSpecifics re­ceived roy­al­ties from En­do’s col­la­ge­nase-based ther­a­pies, which En­do mar­ket­ed in the US. The head­lin­er in the deal is Xi­aflex, a shot used to treat Dupuytren’s con­trac­ture and Pey­ronie’s dis­ease, and al­so in­cludes Qwo, which En­do says is the first FDA-ap­proved in­jectable for cel­lulite.

Joseph Tru­itt

But now in­stead of get­ting those roy­al­ties, BioSpecifics is cash­ing out a few months be­fore Qwo is ex­pect­ed to launch. The buy­out marks the end of a short stint at CEO for Joseph Tru­itt, who was brought on in an in­ter­im role in April and as­sumed per­ma­nent chief ex­ec­u­tive du­ties one month lat­er.

Tru­itt has ex­pe­ri­ence in big-mon­ey ac­qui­si­tions, hav­ing steered Achillion to­ward a $930 mil­lion sale by Alex­ion about a year ago to the day. At the time, Alex­ion jumped on some pos­i­tive Phase II da­ta from Achillion’s for­mer lead can­di­date dan­i­co­pan, which earned it a break­through drug des­ig­na­tion and looked to pair well as a com­ple­men­tary ther­a­py for PNH pa­tients tak­ing Alex­ion’s Soliris.

Though Alex­ion paid a near­ly 75% pre­mi­um for dan­i­co­pan and an­oth­er clin­i­cal-stage as­set, the for­mer has since flopped two Phase II tri­als for C3 glomeru­lopa­thy.

Blaise Cole­man

En­do now is dou­bling down on Xi­aflex and Qwo, two med­i­cines the com­pa­ny be­lieves have “sig­nif­i­cant long-term growth po­ten­tial,” CEO Blaise Cole­man said in a state­ment. Xi­aflex has been ap­proved for Dupuytren’s con­trac­ture, a con­di­tion where a buildup of col­la­gen in the hand forces fin­gers in­to a curved state, in adults since 2010.

SVB Leerink an­a­lyst Ami Fa­dia agreed with Cole­man’s as­sess­ment of the drugs but ques­tioned the tim­ing of the deal, not­ing En­do could have en­gi­neered this ac­qui­si­tion at any time since 2014 af­ter buy­ing Xi­aflex in its pur­chase of Aux­il­i­um. Fa­dia not­ed that En­do, un­like Te­va and Mallinck­rodt, has not set­tled its over­hang­ing lit­i­ga­tion re­lat­ed to the opi­oid epi­dem­ic.

“One could ar­gue that giv­en En­do’s cash po­si­tion (~$1.8B as of 2Q20) and no sig­nif­i­cant debt pay­ments re­quired un­til 2024, the com­pa­ny was in a strong po­si­tion to do BD, and the op­ti­mist could read in­to this an­nounce­ment that the com­pa­ny may have some con­fi­dence in­to its abil­i­ty to rea­son­ably re­solve the opi­oid lit­i­ga­tion, but this is dif­fi­cult to know for sure, and the com­pa­ny is al­ready lev­ered at ~5x,” Fa­dia wrote to in­vestors.

The drug­mak­er is like­ly look­ing to avoid a re­peat of its Som­er­set buy­out from a few years ago. In April 2018, En­do had agreed to buy the phar­ma com­pa­ny and its CD­MO in In­dia for $190 mil­lion, but backed out of the deal the fol­low­ing Feb­ru­ary af­ter it got tied up in “cer­tain reg­u­la­to­ry ap­provals,” then-CEO Paul Cam­pan­el­li said at the time.

Has the mo­ment fi­nal­ly ar­rived for val­ue-based health­care?

RBC Capital Markets’ Healthcare Technology Analyst, Sean Dodge, spotlights a new breed of tech-enabled providers who are rapidly transforming the way clinicians deliver healthcare, and explores the key question: can this accelerating revolution overturn the US healthcare system?

Key points

Tech-enabled healthcare providers are poised to help the US transition to value, not volume, as the basis for reward.
The move to value-based care has policy momentum, but is risky and complex for clinicians.
Outsourced tech specialists are emerging to provide the required expertise, while healthcare and tech are also converging through M&A.
Value-based care remains in its early stages, but the transition is accelerating and represents a huge addressable market.

Clay Siegall, Morphimmune CEO

Up­dat­ed: Ex-Seagen chief Clay Sie­gall emerges as CEO of pri­vate biotech

Clay Siegall will be back in the CEO seat, taking the helm of a private startup working on targeted cancer therapies.

It’s been almost a year since Siegall resigned from Seagen, the biotech he co-founded and led for more than 20 years, in the wake of domestic violence allegations by his then-wife. His eventual successor, David Epstein, sold the company to Pfizer in a $43 billion deal unveiled last week.

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No­vo Nordisk oral semaglu­tide tri­al shows re­duc­tion in blood sug­ar, plus weight loss

Novo Nordisk is testing higher levels of its oral version of its GLP-1, semaglutide, and its type 2 diabetes trial results released today show reductions in blood sugar as well as weight loss.

In the Phase IIIb trial, Novo compared its oral semaglutide in 25 mg and 50 mg doses with the 14 mg version that’s currently the maximum approved dose. The trial looked at how the doses compared when added to a stable dose of one to three oral antidiabetic medicines in people with type 2 diabetes who were in need of an intensified treatment.

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Ly­me vac­cine test com­ple­tion is pushed back by a year as Pfiz­er, Val­ne­va say they'll ad­just tri­al

Valneva and Pfizer have adjusted the end date for the Phase III study of their investigational Lyme disease vaccine, pushing it back by a year after issues at a contract researcher led to thousands of US patients being dropped from the test.

In a March 20 update to clinicaltrials.gov, Valneva and Pfizer moved the primary completion date on the trial, called VALOR, from the end of 2024 to the end of 2025.

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Stuart Peltz, former PTC Therapeutics CEO

Stu­art Peltz re­signs as PTC Ther­a­peu­tics CEO af­ter 25 years

Stuart Peltz, the longtime CEO of PTC Therapeutics who’s led the rare disease drug developer since its founding 25 years ago, is stepping down.

Succeeding him in the top job is Matthew Klein, who joined PTC in 2019 and was promoted to chief operating officer in 2022. In a call with analysts, he said the CEO transition has been planned for “quite some time” — in fact, as part of it, he gave the company’s presentation at the JP Morgan healthcare conference earlier this year.

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Bet­ter Ther­a­peu­tics cuts 35% of staff while await­ing dig­i­tal ther­a­peu­tic ap­proval

Digital therapeutics company Better Therapeutics announced on Thursday that it’s cutting 35% of its staff as it awaits FDA clearance for its first product.

The company, which launched eight years ago, is one of a growing group of companies seeking a digital alternative to traditional medicine. The space saw a record $7.5 billion in investments in 2021, according to Chris Dokomajilar at DealForma, with uses spanning ADHD, PTSD and other indications. However, private insurers have been slow to hop on board.

FDA spells out how can­cer drug de­vel­op­ers can use one tri­al for both ac­cel­er­at­ed and full ap­provals

The FDA’s Oncology Center of Excellence has been a bright spot within the agency in terms of speeding new treatments to patients. That flexibility was on full display this morning as FDA released new draft guidance spelling out exactly how oncology drug developers can fulfill both the accelerated and full approval’s requirements with just a single randomized controlled trial.

While Congress recently passed legislation that will allow FDA to require confirmatory trials to be recruiting and ongoing prior to granting an accelerated approval, the agency is now making clear that the initial trial used to win the AA, if designed appropriately, can also serve as the trial for converting the accelerated approval into a full approval.

Geoff McDonough, Generation Bio president and CEO

Mod­er­na part­ners on non-vi­ral gene ther­a­py with Gen­er­a­tion Bio af­ter swing­ing gene edit­ing deals

Moderna has inked a five-year partnership with gene therapy biotech Generation Bio, it announced Thursday morning, wading deeper into the genetic medicines space as it navigates beyond its vaccine work.

Moderna will pay Generation Bio $40 million upfront and invest another $36 million into the gene therapy biotech. In exchange, Moderna can license Generation Bio’s non-viral gene therapy platforms for two immune cell programs and two liver programs, with an option for a fifth program. Moderna will fund all the research work under the partnership, and could be on the hook for milestone, fee and royalty payments totaling up to $1.8 billion, a company spokesperson tells Endpoints News.

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Steven James, Pionyr Immunotherapeutics CEO

Gilead pass­es on ful­ly ac­quir­ing Pi­o­nyr, as eyes now turn to Tizona, a fel­low sum­mer 2020 buy­out op­tion

Gilead and Pionyr Immunotherapeutics, a biotech trying to follow up on the first generation of checkpoint inhibitors, have “mutually agreed” on a rewrite to their 2020 terms, with Gilead deciding not to buy out the company.

The California biopharma waived its option to acquire the remaining 50.1% of Pionyr, which would have triggered a $315 million upfront payment and up to $1.15 billion down the road. Had Gilead waited to decide, the drugmaker would have had a potential payment to make in the near term under their agreement, a spokesperson said in an email to Endpoints News.

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