Get­ting to work on pipeline con­struc­tion, new Ipsen CEO forges $1B deal to buy Mer­ri­mack’s strug­gling Onivyde

Ipsen CEO David Meek

Mer­ri­mack Phar­ma­ceu­ti­cals and Ipsen, two biotechs look­ing to re­or­ga­nize and move up in the world, have struck a bil­lion-dol­lar deal for a floun­der­ing can­cer ther­a­py. The Paris-based Ipsen is hand­ing over $575 mil­lion in cash and promis­ing up to $450 mil­lion in mile­stones to grab Mer­ri­mack’s US rights to Onivyde, ap­proved for pan­cre­at­ic can­cer. And new Ipsen CEO David Meek tells End­points that you can ex­pect more deals to come.

Ipsen gets Mer­ri­mack’s $MACK on­ly mar­ket­ed drug just a few months af­ter the Boston-based biotech oust­ed its CEO fol­low­ing its lack­lus­ter de­but, which pro­vid­ed on­ly mar­gin­al im­prove­ments on sur­vival rates for ad­vanced pan­cre­at­ic can­cer pa­tients. The French biotech al­so adds Mer­ri­mack’s com­mer­cial ops in the US as well as man­u­fac­tur­ing. And it lines up the fast-grow­ing Shire as a part­ner, which has been han­dling ex-US mar­ket­ing on the drug.

Onivyde earned on­ly $14.5 mil­lion in the third quar­ter, net, leav­ing an­a­lysts un­hap­py with Mer­ri­mack’s progress and prospects. But Ipsen’s Meek, who took over sev­en months ago — af­ter Shire ac­quired Bax­al­ta, where he had been pres­i­dent of on­col­o­gy — sees this deal as a great chance to add to its pres­ence in Cam­bridge, MA as well as the US mar­ket, feed­ing in­to their work to mar­ket So­mat­u­line. And there’s po­ten­tial up­side in sev­er­al on­go­ing stud­ies aimed at ex­pand­ing its use.

“For us the sweet spot is gain­ing a mar­ket­ed prod­uct in on­col­o­gy,” Meek tells me. It’s a “great deal” just for the cur­rent in­di­ca­tion in pan­cre­at­ic can­cer, he adds, where Onivyde is the on­ly ap­proved drug in a post-gem­c­itabine set­ting.

Sources close to the deal tell me that the deal gives Mer­ri­mack the mon­ey it needs to com­plete its re­struc­tur­ing and re­fo­cus for a three-year stretch, with plans for a $1.54 div­i­dend, pay­ing off $175 mil­lion in notes and rein­vest­ing in its three top re­main­ing clin­i­cal stage ef­forts for MM-121, MM-141 and MM-310. MM-302, which failed a re­cent study, is be­ing shelved.

The deal is worth $5 a share, says the source, for stock that closed Fri­day at $3.60, which gave Mer­ri­mack a mar­ket cap of $466 mil­lion — sig­nif­i­cant­ly less than the up­front in the deal. And the cash funds op­er­a­tions go­ing for­ward in­to H2 2019, giv­ing the com­pa­ny time to pro­vide sol­id da­ta on the three key drugs in the pipeline.

“There had to be a process to nar­row the best path for­ward,” says the source.  “Ob­vi­ous­ly the drug hasn’t per­formed as well as hoped,” but this drug pro­vides “max­i­mum val­ue” for the next stage of de­vel­op­ment as it goes back to be­ing an R&D-stage biotech.

In a re­lease out Sun­day evening, Mer­ri­mack not­ed: “The mile­stones are com­posed of: $225 mil­lion for U.S. Food and Drug Ad­min­is­tra­tion (“FDA”) ap­proval in first-line pan­cre­at­ic can­cer, $150 mil­lion for FDA ap­proval in small cell lung can­cer and $75 mil­lion for FDA ap­proval in any third in­di­ca­tion.” All of that mon­ey will be re­turned to share­hold­ers.

What­ev­er the mo­ti­va­tion to sell, Meek is hap­py to be on the buy­ing end. There’s a Phase II study planned for Onivyde on first-line pan­cre­at­ic can­cer use, which can run straight in­to Phase III. An­oth­er mid-stage ef­fort is un­der­way for small cell lung can­cer and an ear­ly stage study for breast can­cer.

“The up­side,” Meek says, “is pure up­side.”

Meek says that he’s just get­ting start­ed. He’s plan­ning on adding more drug deals to beef up a pipeline in on­col­o­gy, neu­ro­science and rare dis­eases.

“We’re try­ing to glob­al­ize our busi­ness,” says the CEO. “We want an even big­ger pres­ence in the US than where we are to­day.”

For starters, the deal will in­volve adding about 100 Mer­ri­mack staffers to Ipsen’s pay­roll, which cur­rent­ly ac­counts for about 4,500 em­ploy­ees glob­al­ly. And Meek says the pact will add to the 100 staffers on site in Cam­bridge, MA, one of three R&D sites the com­pa­ny has, in­clud­ing op­er­a­tions in Lon­don/Ox­ford and Paris.

The FDA ap­proved Onivyde back in the fall of 2015 as a sec­ond-line treat­ment. Pa­tients treat­ed with Onivyde plus flu­o­rouracil/leu­cov­orin lived an av­er­age of 6.1 months, com­pared to 4.2 months for those treat­ed with on­ly flu­o­rouracil/leu­cov­orin. There was no sur­vival im­prove­ment for those who re­ceived on­ly Onivyde com­pared to those who re­ceived flu­o­rouracil/leu­cov­orin.

Ipsen is part­nered with Ex­elix­is on cabozan­ti­nib, han­dling the ex-US sales of the drug.

For Mer­ri­mack, the sale comes just weeks af­ter its lead ex­per­i­men­tal drug, MM-302, failed for breast can­cer in a clin­i­cal study. Mer­ri­mack cut 22% of its work force in Oc­to­ber as Robert Mul­roy, who cham­pi­oned Onivyde and tout­ed its fu­ture, stepped out of the com­pa­ny. With this lat­est re­or­ga­ni­za­tion, Mer­ri­mack will be left with 80 staffers, down about 320 from the pay­roll it sup­port­ed in Oc­to­ber 2016.

ZS Per­spec­tive: 3 Pre­dic­tions on the Fu­ture of Cell & Gene Ther­a­pies

The field of cell and gene therapies (C&GTs) has seen a renaissance, with first generation commercial therapies such as Kymriah, Yescarta, and Luxturna laying the groundwork for an incoming wave of potentially transformative C&GTs that aim to address diverse disease areas. With this renaissance comes several potential opportunities, of which we discuss three predictions below.

Allogenic Natural Killer (NK) Cells have the potential to displace current Cell Therapies in oncology if proven durable.

Despite being early in development, Allogenic NKs are proving to be an attractive new treatment paradigm in oncology. The question of durability of response with allogenic therapies is still an unknown. Fate Therapeutics’ recent phase 1 data for FT516 showed relatively quicker relapses vs already approved autologous CAR-Ts. However, other manufacturers, like Allogene for their allogenic CAR-T therapy ALLO-501A, are exploring novel lymphodepletion approaches to improve persistence of allogenic cells. Nevertheless, allogenic NKs demonstrate a strong value proposition relative to their T cell counterparts due to comparable response rates (so far) combined with the added advantage of a significantly safer AE profile. Specifically, little to no risk of graft versus host disease (GvHD), cytotoxic release syndrome (CRS), and neurotoxicity (NT) have been seen so far with allogenic NK cells (Fig. 1). In addition, being able to harness an allogenic cell source gives way to operational advantages as “off-the-shelf” products provide improved turnaround time (TAT), scalability, and potentially reduced cost. NKs are currently in development for a variety of overlapping hematological indications with chimeric antigen receptor T cells (CAR-Ts) today, and the question remains to what extent they will disrupt the current cell therapy landscape. Click for more details.

Graphic: Kathy Wong for Endpoints News

What kind of biotech start­up wins a $3B syn­di­cate, woos a gallery of mar­quee sci­en­tists and re­cruits GSK's Hal Bar­ron as CEO in a stun­ner? Let Rick Klaus­ner ex­plain

It started with a question about a lifetime’s dream on a walk with tech investor Yuri Milner.

At the beginning of the great pandemic, former NCI chief and inveterate biotech entrepreneur Rick Klausner and the Facebook billionaire would traipse Los Altos Hills in Silicon Valley Saturday mornings and talk about ideas.

Milner’s question on one of those mornings on foot: “What do you want to do?”

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Hal Barron, Endpoints UKBIO20 (Jeff Rumans)

'Al­tos was re­al­ly a once-in-a-life­time op­por­tu­ni­ty': Hal Bar­ron re­flects on his big move

By all accounts, Hal Barron had one of the best jobs in Big Pharma R&D. He made more than $11 million in 2020, once again reaping more than his boss, Emma Walmsley, who always championed him at every opportunity. And he oversaw a global R&D effort that struck a variety of big-dollar deals for oncology, neurodegeneration and more.

Sure, the critics never let up about what they saw as a rather uninspiring late-stage pipeline, where the rubber hits the road in the Big Pharma world’s hunt for the next big near-term blockbuster, but the in-house reviews were stellar. And Barron was firmly focused on bringing up the success rate in clinical trials, holding out for the big rewards of moving the dial from an average 10% success rate to 20%.

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Executive Director of the EMA Emer Cooke (AP Photo/Geert Vanden Wijngaert)

Eu­ro­pean Par­lia­ment signs off on strength­en­ing drug reg­u­la­tor's abil­i­ty to tack­le short­ages

The European Parliament on Thursday endorsed a plan to increase the powers of the European Medicines Agency, which will be better equipped to monitor and mitigate shortages of drugs and medical devices.

By a vote of 655 to 31, parliament signed off on a provisional agreement reached with the European Council from last October, in which the EMA will create two shortage steering groups (one for drugs, the other for devices), a new European Shortages Monitoring Platform to facilitate data collection and increase transparency, and on funding for the work of the steering groups, task force, working parties and expert panels that are to be established.

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FDA+ roundup: FDA's neu­ro­science deputy de­parts amid on­go­ing Aduhelm in­ves­ti­ga­tions; Califf on the ropes?

Amid increased scrutiny into the close ties between FDA and Biogen prior to the controversial accelerated approval of Aduhelm, the deputy director of the FDA’s office of neuroscience has called it quits after more than two decades at the agency.

Eric Bastings will now take over as VP of development strategy at Ionis Pharmaceuticals, the company said Wednesday, where he will provide senior clinical and regulatory leadership in support of Ionis’ pipeline.

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Sec­ondary patents prove to be key in biosim­i­lar block­ing strate­gies, re­searchers find

While the US biosimilars industry has generally been a disappointment since its inception, with FDA approving 33 biosimilars since 2015, just a fraction of those have immediately followed their approvals with launches. And more than a handful of biosimilars for two of the biggest blockbusters of all time — AbbVie’s Humira and Amgen’s Enbrel — remain approved by FDA but still have not launched because of legal settlements.

Hal Barron (GSK via YouTube)

GSK R&D chief Hal Bar­ron jumps ship to run a $3B biotech start­up, Tony Wood tapped to re­place him

In a stunning switch, GlaxoSmithKline put out word early Wednesday that R&D chief Hal Barron is exiting the company after 4 years — a relatively brief run for the man chosen by CEO Emma Walmsley in late 2017 to turn around the slow-footed pharma giant.

Barron is being replaced by Tony Wood, a close associate of Barron’s who’s taking one of the top jobs in Big Pharma R&D. He’ll be closer to home, though, for GSK. Barron has been running a UK and Philadelphia-based research organization from his perch in San Francisco.

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Troy Wilson, Kura CEO

FDA lifts par­tial hold on Ku­ra's Phase Ib AML pro­gram as biotech re­dou­bles mit­i­ga­tion ef­forts

Kura Oncology is clear to resume studies for its early-stage leukemia program after the FDA lifted a clinical hold Thursday afternoon.

Regulators had placed the hold on a Phase Ib study of KO-539, an experimental oral treatment for some genetic subsets of acute myeloid leukemia last November after a patient died while taking the drug. Kura expects to begin enrolling patients again imminently, CEO Troy Wilson told Endpoints News.

A Sen­ate bill wants to even an 'un­lev­el play­ing field' for do­mes­tic, for­eign in­spec­tion drop-ins amid back­log

Amid geopolitical tensions between the US and China, two Republican senators are calling for a bill that would aim to strike a balance on domestic and foreign inspection requirements from the FDA.

Sens. Mike Braun (R-IN) and Joni Ernst (R-IA) have penned a bill called the Creating Efficiency in Foreign Inspections Act. It contains a bit of rhetoric, highlighting “communist China” not once, but twice in the release, but states that the goal is to even the playing field between foreign and American manufacturers.

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