Gold­man Sachs jumps aboard Bain-backed 503(b) com­pound­ing phar­ma­cy with a $275M debt loan to sup­ply hos­pi­tals

Long the bane of the FDA’s ex­is­tence, com­pound­ing phar­ma­cies have seen a mi­nor resur­gence in the past year as short-term sav­iors for hos­pi­tal drug short­ages. Now, a 503(b) com­pa­ny spe­cial­iz­ing in hos­pi­tal meds has earned a big backer to keep ex­pand­ing its 200-drug strong port­fo­lio.

Alex Chi

Gold­man Sachs and Owl Rock Cap­i­tal Part­ners have doled out a $275 mil­lion debt loan to Qu­Va Phar­ma, a 503(b)-cer­ti­fied out­sourc­ing fa­cil­i­ty pro­vid­ing com­pound­ed drugs to hos­pi­tals, the com­pa­ny said Thurs­day.


The com­pa­ny sports Bain Cap­i­tal as a share­hold­er and will use the pro­ceeds from the loan to ex­pand its net­work of part­nered hos­pi­tals and add new prod­ucts to grow its more than 200-prod­uct port­fo­lio, ac­cord­ing to a state­ment. Mean­while, the com­pa­ny plans to add up to 75,000 square feet of space at its Sug­ar Land, TX site south­west of Hous­ton by 2022, it said.

“We be­lieve Qu­Va of­fers a com­pelling val­ue propo­si­tion to hos­pi­tals in need of a re­li­able, cost-ef­fec­tive sup­ply of es­sen­tial in­jectable med­ica­tion,” said Alex Chi, Gold­man Sachs’ head of pri­vate cred­it in­vest­ing group in the Amer­i­c­as, in a state­ment.

Qu­Va re­cent­ly added 80,000 square feet of floor space in New Jer­sey, bring­ing the com­pa­ny’s to­tal foot­print be­fore the Texas ex­pan­sion to 240,000 square feet. With all the new el­bow room, Qu­Va said it hopes to bring its to­tal work­force to more than 1,000 as well as “im­ple­ment in­no­v­a­tive au­toma­tion ini­tia­tives unique to the in­dus­try” at its sites.

Long a tar­get for FDA reg­u­la­tors over the con­sis­ten­cy of the drugs they pro­duce, com­pound­ing phar­ma­cies have seen a turn of for­tune dur­ing the pan­dem­ic as hos­pi­tal sys­tems have looked for a con­stant sup­ply of drugs. Com­pa­nies in the 503(b) pro­gram have far more over­sight — and ac­cep­tance — than a stan­dard com­pound­ing phar­ma­cy with the FDA re­quir­ing them to sell specif­i­cal­ly to health­care sys­tems for of­fice use.

Back in April 2020, the FDA loos­ened its no­to­ri­ous­ly tight re­stric­tions on the com­pound­ing in­dus­try in the ear­ly days of the pan­dem­ic, al­low­ing hos­pi­tals to source med­i­cines di­rect­ly from those firms. It was an un­prece­dent­ed de­ci­sion the FDA at the time said was tied di­rect­ly to chron­ic short­ages.

Stu­art Hinchen

Those short­ages have high­light­ed the need for a sta­ble sup­ply of cheap med­i­cines, par­tic­u­lar­ly anes­thet­ics used in sur­gi­cal care, and pri­vate in­dus­try has seen enough, ap­par­ent­ly, to jump on board.

“This new fund­ing re­flects the na­tion­al scale Qu­Va has achieved as the in­dus­try leader, and the im­por­tance of the 503B in­dus­try in meet­ing hos­pi­tal’s high qual­i­ty stan­dards and cost ef­fec­tive­ness re­quire­ments,” Stu­art Hinchen, Qu­Va Phar­ma’s co-founder and CEO, said in a state­ment.

Forge Bi­o­log­ics’ cGMP Com­pli­ant and Com­mer­cial­ly Vi­able Be­spoke Affin­i­ty Chro­matog­ra­phy Plat­form

Forge Biologics has developed a bespoke affinity chromatography platform approach that factors in unique vector combinations to streamline development timelines and assist our clients in efficiently entering the clinic. By leveraging our experience with natural and novel serotypes and transgene conformations, we are able to accelerate affinity chromatography development by nearly 3-fold. Many downstream purification models are serotype-dependent, demanding unique and time-consuming development strategies for each AAV gene therapy product1. With the increasing demand to propel AAV gene therapies to market, platform purification methods that support commercial-scale manufacturing of high-quality vectors with excellent safety and efficacy profiles are essential.

Jeff Bluestone (R), Sonoma Biotherapeutics CEO

Jef­frey Blue­stone brings his start­up haul to $400M+, join­ing forces with Re­gen­eron on cell ther­a­pies

These days, when Jeffrey Bluestone gets together with his contemporaries in science, the conversation often turns to retirement plans.

But a little more than three years ago, Bluestone reached a momentous turning point in his career, exiting a prestigious post at UCSF, where he had spent decades in the scientific pursuit of new therapies. And it had nothing to do with retirement anytime in the near future.

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Mathai Mammen, FogPharma's next CEO

Math­ai Mam­men hands in J&J's R&D keys to lead Greg Ver­dine’s Fog­Phar­ma 

In the early 1990s, Mathai Mammen was a teaching assistant in Greg Verdine’s Science B46 course at Harvard. In June, the former R&D head at Johnson & Johnson will succeed Verdine as CEO, president and chair of FogPharma, the same month the seven-year-old biotech kickstarts its first clinical trial.

After leading R&D at one of the largest drugmakers in the world, taking the company through more than half a dozen drug approvals in the past few years, not to mention a Covid-19 vaccine race, Mammen departed J&J last month and will take the helm of a Cambridge, MA biotech attempting to go after what Verdine calls the “true emperor of all oncogenes” — beta-catenin.

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Alec­tor cuts 11% of work­force as it dou­bles down on late-stage neu­ro pro­grams part­nered with GSK, Ab­b­Vie

A month after revealing plans to concentrate on its late-stage immuno-neurology pipeline, Alector is trimming its headcount by 11%.

The layoffs will impact around 30 employees across the organization, the company disclosed in an SEC filing, adding that the plan will “better align the company’s resources” with the new strategy. With $712.9 million in cash, cash equivalents and investments as of the end of 2022, Alector believes the reserves will now get it through 2025.

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Hugo Peris, Spiral Therapeutics CEO

Hear­ing-fo­cused biotech grabs trio of pro­grams from Oton­o­my's fire sale

Otonomy may be shutting down, but the lessons learned there will live on at another biotech working on new treatments for hearing loss.

San Francisco-based Spiral Therapeutics has bought certain assets related to three of Otonomy’s programs, ranging from data, patent rights, and know-how to inventory. That includes data around Otonomy’s twice-failed lead program, OTO-104 (Otividex), a sustained-exposure formulation of dexamethasone.

UK gov­ern­ment, pri­vate in­vestors dole out $340M+ to drug, di­ag­nos­tic man­u­fac­tur­ers

The government of the United Kingdom is giving out grants to several manufacturers that have a presence in England, Wales and Northern Ireland.

The government announced that four companies, including Ipsen, contract manufacturer Pharmaron, DNA manufacturer Touchlight and diagnostic test producer Randox, will receive a total of £277 million ($341.1 million). According to a release from the UK government, this represents the first portion of grants from the Life Sciences Innovative Manufacturing Fund.

Michael Foley, Deerfield Discovery and Development CEO

Deer­field Dis­cov­ery nets $50M grant from the state of New York and par­ent com­pa­ny

The discovery arm of the healthcare investment player Deerfield Management Company is getting a major financial boost.

Deerfield Discovery and Development will receive $25 million, over five years, from the state of New York and Empire State Development, a state organization that offers grants, loans and other assistance to companies. Another $25 million will come from Deerfield Management.

The funds will go toward the buildout of a 6,000-square-foot lab space at Cure, a healthcare campus founded by Deerfield at 345 Park Ave. South in New York City. The money will also be used for purchasing equipment and software, operating costs and other items.

Covant acting CEO Matt Maisak (L) and CSO Iván Cornella

With Boehringer In­gel­heim’s help, Roivant churns out an­oth­er Vant to go up against En­deav­or, Im­pact founders

Roivant Sciences has added another branch to its family tree, unveiling Covant Therapeutics with a $10 million upfront commitment from Boehringer Ingelheim to turn up the heat in cancer.

The Boston-based drug discovery startup will jointly create a new small molecule immunotherapy with the private German pharma giant. The deal, made public Tuesday morning, includes up to $471 million in future payments and tiered royalties, should the product make it to market.

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CSL CEO Paul McKenzie (L) and CMO Bill Mezzanotte

Q&A: New­ly-mint­ed CSL chief ex­ec­u­tive Paul McKen­zie and chief med­ical of­fi­cer Bill Mez­zan­otte

Paul McKenzie took over as CEO of Australian pharma giant CSL this month, following in the footsteps of long-time CSL vet Paul Perreault.

With an eye on mRNA, and quickly commercializing its new, $3.5 million-per-shot gene therapy for hemophilia B, McKenzie and chief medical officer Bill Mezzanotte answered some questions from Endpoints News this afternoon about where McKenzie is going to take the company and what advances may be coming to market from CSL’s pipeline. Below is a lightly edited transcript.