En­gulfed in le­gal trou­ble, bank­rupt­cy could be the an­swer for opi­oid drug­mak­er In­sys

In­sys’ le­gal ex­pens­es are catch­ing up with the opi­oid drug mak­er. On Fri­day, the Ari­zona com­pa­ny in­di­cat­ed it was fac­ing a liq­uid­i­ty cri­sis — due to the mount­ing lit­i­ga­tion it is fac­ing re­lat­ed to the sales prac­tices for its ad­dic­tive fen­tanyl-based painkiller — that could com­pel it in­to fil­ing for bank­rupt­cy pro­tec­tion.

Ear­li­er this month, a fed­er­al ju­ry found In­sys’ (for­mer) bil­lion­aire founder John Kapoor and four of his (for­mer) high rank­ing col­leagues guilty of en­gag­ing in a bribery scheme to get doc­tors to pre­scribe its po­tent, ad­dic­tive painkiller Sub­sys and dupe in­sur­ers in­to pay­ing for the drug.


Im­age: John Kapoor leaves court in May, 2019. AP IM­AGES

Kapoor cre­at­ed In­sys $IN­SY in 1990. In 2012, the com­pa­ny’s fen­tanyl spray Sub­sys was ap­proved by the FDA for break­through can­cer pain. Fen­tanyl is a man-made opi­oid 50 times more po­tent than hero­in and 100 times more po­tent than mor­phine, ac­cord­ing to the CDC. Pros­e­cu­tors charged In­sys with in­flat­ing Sub­sys sales by brib­ing doc­tors to pre­scribe the drug to pa­tients with­out can­cer — in an elab­o­rate scheme that in­clud­ed win­ing and din­ing them, pay­ing them to speak at “ed­u­ca­tion­al events” and in one case even a lap dance — fu­el­ing the rag­ing opi­oid cri­sis that kills 130 Amer­i­cans every day.

The com­pa­ny’s le­gal ex­pens­es jumped about 150% to $25.7 mil­lion in the first-quar­ter of 2019, ver­sus the same quar­ter last year. This ex­pen­di­ture in­clud­ed $18.1 mil­lion re­lat­ed to the in­dem­ni­fi­ca­tion of John Kapoor in con­nec­tion with his tri­al, In­sys said.

Last Au­gust, In­sys reached a ten­ta­tive agree­ment to fork over $150 mil­lion to re­solve a US De­part­ment of Jus­tice probe in­to claims that the com­pa­ny en­gaged in a kick­back scheme that com­pen­sat­ed doc­tors to pre­scribe Sub­sys. By No­vem­ber, the com­pa­ny said it was look­ing at strate­gic al­ter­na­tives, no­tably a sale of its ar­se­nal of opi­oid as­sets — in­clud­ing Sub­sys. Last month, In­sys’ au­di­tor raised doubts on the drug­mak­er’s abil­i­ty to con­tin­ue as a go­ing con­cern.

As of March 31, the com­pa­ny has $87.6 mil­lion in cash and cash equiv­a­lents and in­vest­ments — as well as ac­crued li­a­bil­i­ties of rough­ly $240.3 mil­lion in pro­posed set­tle­ments of var­i­ous lit­i­ga­tion mat­ters (and oth­ers le­gal mat­ters that are still be­ing re­solved), In­sys said, adding it ex­pects to have con­tin­ued neg­a­tive cash flows from op­er­at­ing ac­tiv­i­ties.

If the com­pa­ny’s fi­nan­cial af­fairs are not fixed — via the sale of its as­sets and/or a fi­nal agree­ment with the DoJ — “it may be nec­es­sary for the com­pa­ny to file a vol­un­tary pe­ti­tion for re­lief un­der Chap­ter 11 of the Unit­ed States Bank­rupt­cy Code in or­der to im­ple­ment a re­struc­tur­ing,” In­sys said in a state­ment.

In­sys is hard­ly the on­ly opi­oid drug mak­er in fi­nan­cial trou­ble. Pur­due Phar­ma — the mak­er of one of most wide­ly abused pre­scrip­tion opi­oid painkiller Oxy­con­tin — is re­port­ed­ly con­sid­er­ing bank­rupt­cy. Mean­while, oth­er drug man­u­fac­tur­ers, dis­trib­u­tors and phar­ma­cies are al­so fac­ing hun­dreds of civ­il law­suits for their role in prop­a­gat­ing the opi­oid cri­sis.

Paul Hudson, Getty Images

UP­DAT­ED: Sanofi CEO Hud­son lays out new R&D fo­cus — chop­ping di­a­betes, car­dio and slash­ing $2B-plus costs in sur­gi­cal dis­sec­tion

Earlier on Monday, new Sanofi CEO Paul Hudson baited the hook on his upcoming strategy presentation Tuesday with a tell-tale deal to buy Synthorx for $2.5 billion. That fits squarely with hints that he’s pointing the company to a bigger future in oncology, which also squares with a major industry tilt.

In a big reveal later in the day, though, Hudson offered a slate of stunners on his plans to surgically dissect and reassemble the portfoloio, saying that the company is dropping cardio and diabetes research — which covers two of its biggest franchise arenas. Sanofi missed the boat on developing new diabetes drugs, and now it’s pulling out entirely. As part of the pullback, it’s dropping efpeglenatide, their once-weekly GLP-1 injection for diabetes.

“To be out of cardiovascular and diabetes is not easy for a company like ours with an incredibly proud history,” Hudson said on a call with reporters, according to the Wall Street Journal. “As tough a choice as that is, we’re making that choice.”

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De­vel­op­ment of the Next Gen­er­a­tion NKG2D CAR T-cell Man­u­fac­tur­ing Process

Celyad’s view on developing and delivering a CAR T-cell therapy with multi-tumor specificity combined with cell manufacturing success
Overview
Transitioning potential therapeutic assets from academia into the commercial environment is an exercise that is largely underappreciated by stakeholders, except for drug developers themselves. The promise of preclinical or early clinical results drives enthusiasm, but the pragmatic delivery of a therapy outside of small, local testing is most often a major challenge for drug developers especially, including among other things, the manufacturing challenges that surround the production of just-in-time and personalized autologous cell therapy products.

What does $6.9B buy these days in on­col­o­gy R&D? As­traZeneca has a land­mark an­swer

Given the way the FDA has been whisking through new drug approvals months ahead of their PDUFA date, AstraZeneca and their partners Daiichi Sankyo may not have to wait until Q2 of next year to get a green light on trastuzumab deruxtecan (DS-8201).

The pharma giant this morning played their ace in the hole, showing off why they were willing to commit to a $6.9 billion deal — with $1.35 billion in a cash upfront — to partner on the drug.

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FDA in-house re­view spot­lights an is­sue with one of Hori­zon's end­points but notes ef­fi­ca­cy for lead drug

The FDA in-house review highlights a disagreement of investigators’ use of a key endpoint by Horizon Pharma in the late-stage trial for the top drug in its pipeline, but largely agreed that the antibody was effective.

Horizon submitted a BLA for thyroid eye disease (TED) drug teprotumumab in March, less than two years after they bought the drug (and the rest of a division) from Narrow River for $145 million upfront. With breakthrough status, priority review, orphan designation and in-house sales projections of up to $750 million, the one-time Roche reject became the marquee pipeline asset for a company that’s developed some of the world’s most expensive drugs.

Seat­tle Ge­net­ics de­tails pos­i­tive OS and PFS da­ta for tu­ca­tinib in breast can­cer

Seattle Genetics $SGEN is showing off more positive data around tucatinib, its pivotal-stage drug for HER2 positive breast cancer.

A month after hearing about solidly upbeat hazard ratios, we learned today that the estimated progression-free survival rate at one year was 33% in the tucatinib arm compared to 12% for patients taking trastuzumab and capecitabine alone.

Median PFS was 7.8 months (95% CI: 7.5, 9.6) in the tucatinib arm, compared to 5.6 months (95% CI: 4.2, 7.1) in the control arm.

Bat­tered, cash hun­gry In­tec feels the burn of No­var­tis re­jec­tion

It’s a case of some bad timing for Intec.

Just when a key trial testing the company’s Accordion drug delivery tech imploded in Parkinson’s disease, they handed Novartis data from a successful PK study of a custom Accordion pill engineered to deliver a Novartis compound to entice the Swiss drugmaker into signing a licensing agreement.

Novartis said thanks, but no thanks.

For the cash-strapped Israeli drug developer, the failure to clinch the deal marks a big blow. As of the third quarter, the company has $15.7 million in cash and equivalents, which HC Wainwright analysts estimate will keep the lights on into mid-2020.

Bris­tol-My­ers shows off a low-pro­file AML con­tender it gained from Cel­gene buy­out — and they’re tak­ing it straight to the FDA

Bristol-Myers Squibb reaped an enormous pipeline with its much-criticized $64 billion megadeal to buy Celgene. And it got a few hidden gems in the deal.

One of those gems was brought out for display on Tuesday, with a late-breaker at ASH on CC-486, which is now being prepped for regulatory filings at the FDA and elsewhere.

Celgene top-lined the positive results in a maintenance setting for acute myeloid leukemia a few months ago, but at ASH investigators pulled back the curtains on the all-important data they believe will give them an advantage in the commercial wars to come.

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De­sert­ed by Astel­las and Mer­ck, lit­tle Cor­re­vio still can't win over FDA pan­el con­cerned with its AFib drug's safe­ty

When the FDA spurned Astellas’ pitch for atrial fibrillation drug vernakalant in 2008, regulators made it abundantly clear that it wasn’t the efficacy they had a problem with — two Phase III trials had shown the drug successfully restored 52% of patients’ heartbeat from irregular to normal — but the cardio safety issues for a drug that was to compete with well established, low-risk options. One licensing deal, one clinical hold and several studies later, the chances of approval aren’t looking any better.

New trade deal knocks out long-sought patent pro­tec­tions for drug­mak­ers

House Democrats negotiating with the Trump Administration on a new North American trade deal settled early on four issues: enforcement, labor and environmental standards and drug pricing.

On drug pricing, Politico reports, Trump crumbled within weeks of heightened negotiations.

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