GSK CEO Walm­s­ley is re­or­ga­niz­ing R&D, drop­ping drugs and adding a new fo­cus on can­cer re­search

Just days af­ter rush­ing Dana-Far­ber chief Lau­rie Glim­ch­er on­to the board at Glax­o­SmithK­line $GSK, new CEO Em­ma Walm­s­ley is mak­ing her move to re­or­ga­nize the pipeline. Her plan calls for a ma­jor R&D cull, drop­ping 30 de­vel­op­ment projects and adding can­cer and im­muno-in­flam­ma­to­ry dis­eases to its list of top R&D pri­or­i­ties — which will con­sume the li­on’s share of its bud­get.

Em­ma Walm­s­ley

In a state­ment out ear­ly Wednes­day, GSK out­lined plans to part­ner out or sim­ply drop 30 pre­clin­i­cal and clin­i­cal pro­grams, stream­lin­ing R&D and oth­er op­er­a­tions in the glob­al op­er­a­tion as the com­pa­ny looks for about $1.3 bil­lion in sav­ings by 2020. Rare dis­ease drugs in par­tic­u­lar ap­pear to be on the chop­ping block while a list of as­sets that are be­ing dropped from the pipeline in­cludes sirukum­ab, its dis­ap­point­ing rheuma­toid arthri­tis drug now un­der reg­u­la­to­ry re­view and part­nered with J&J $JNJ.

You can see the full list be­low.

The move puts GSK back in play as sev­er­al top bio­phar­ma com­pa­nies look to shake up their R&D or­ga­ni­za­tions and start to strike new deals. And the phar­ma gi­ant’s re­turn to the deal ta­ble will quick­ly earn close at­ten­tion from a long list of ri­vals. More big play­ers are al­so like­ly to fol­low suit, mark­ing a turn­ing point for bio­phar­ma as a slate of new CEOs look to put their dis­tinc­tive stamp on prod­uct de­vel­op­ment.

The plan at Glax­o­SmithK­line now is to re­serve about 80% of its an­nu­al multi­bil­lion-dol­lar bud­get for two main­stay dis­ease fields — res­pi­ra­to­ry and HIV/in­fec­tious dis­eases — while ex­am­in­ing the “po­ten­tial” ad­di­tion of can­cer and im­muno-in­flam­ma­tion. GSK spent $4.5 bil­lion on R&D, putting it among the top 15 in the in­dus­try.

The phar­ma gi­ant al­so plans to get its busi­ness de­vel­op­ment team back to the bar­gain­ing ta­ble af­ter a long ab­sence in search of new, pri­mar­i­ly ear­ly-stage deals.

Walm­s­ley in­her­it­ed one of the weak­est R&D groups in Big Phar­ma when she took the helm in April. De­spite sig­nif­i­cant progress in HIV and vac­cines, phar­ma R&D lan­guished af­ter a pe­ri­od marked by some high-pro­file flame­outs in Phase III de­vel­op­ment. Now the CEO wants to use the stream­lin­ing to set up a re­vival for the phar­ma re­search group.

From their quar­ter­ly state­ment:

In its Phar­ma­ceu­ti­cals pipeline, GSK has de­vel­oped a pri­or­i­ty list of as­sets to in­vest be­hind. This pri­or­i­ty list will evolve as da­ta reads out. The Group has al­so set a tar­get to de­ploy over time 80% of its Phar­ma­ceu­ti­cals R&D cap­i­tal to pri­or­i­ty as­sets in two cur­rent ther­a­py ar­eas: Res­pi­ra­to­ry and HIV/in­fec­tious dis­eases; and two po­ten­tial ar­eas: On­col­o­gy and Im­muno-in­flam­ma­tion. Sig­nif­i­cant da­ta is ex­pect­ed from these pri­or­i­ty as­sets over the next three years which will be used to in­form R&D in­vest­ment de­ci­sions and how best to gen­er­ate val­ue from these as­sets. GSK al­so ex­pects to pur­sue dis­ci­plined busi­ness de­vel­op­ment to aug­ment its ear­ly-stage pipeline in these pri­or­i­ty ar­eas.

Now in the spot­light at GSK: A range of Phase I and Phase II can­cer drugs, in­clud­ing its mid-stage pro­gram part­nered with Adap­ti­m­mune $ADAP.

J&J says that GSK’s de­ci­sion to bail out on sirukum­ab leaves them in charge of world­wide roll­out, and they have no plans to change course now. In a state­ment to End­points News, the com­pa­ny not­ed:

Our pri­or­i­ty is work­ing with Health Au­thor­i­ties in the U.S., Eu­rope, Japan and many oth­er coun­tries to bring this nov­el an­ti-IL-6 mon­o­clon­al an­ti­body to RA pa­tients.  We are con­tin­u­ing with launch prepa­ra­tions in EMEA and Asia Pa­cif­ic through our world-class Janssen Im­munol­o­gy or­ga­ni­za­tion, and we are al­so ex­plor­ing the best op­por­tu­ni­ties to bring this im­por­tant new med­i­cine to pa­tients in the ge­o­gra­phies that will re­turn to Janssen.

The move at GSK mir­rors the same ba­sic strat­e­gy that Michel Vounatsos and Dave Ricks an­nounced yes­ter­day for Bio­gen and Eli Lil­ly. Both have been lay­ing plans to “stream­line” op­er­a­tions and de­vote more time to new projects that can whip up some ex­cite­ment among the in­vestor crowd. Lil­ly al­so is drop­ping can­cer projects — while GSK looks to add to what’s left of its on­col­o­gy group fol­low­ing a big trade­off with No­var­tis.

These moves will cre­ate dozens of new busi­ness op­por­tu­ni­ties among biotech play­ers look­ing for new as­sets to pick over. Typ­i­cal­ly these projects go for on­ly small amounts of up­front cash. And it al­so adds new play­ers to the deal ta­ble, ready to spend cash and part­ner on more drugs.

GSK sig­naled this move re­cent­ly af­ter it re­cruit­ed Glim­ch­er to its board. The im­muno-on­col­o­gy ex­pert joined the board’s sci­ence team and can of­fer some key in­sights gleaned from years on the board at Bris­tol-My­ers Squibb.

From the GSK pre­sen­ta­tion:

BiTE® Plat­form and the Evo­lu­tion To­ward Off-The-Shelf Im­muno-On­col­o­gy Ap­proach­es

Despite rapid advances in the field of immuno-oncology that have transformed the cancer treatment landscape, many cancer patients are still left behind.1,2 Not every person has access to innovative therapies designed specifically to treat his or her disease. Many currently available immuno-oncology-based approaches and chemotherapies have brought long-term benefits to some patients — but many patients still need other therapeutic options.3

Is a pow­er­house Mer­ck team prepar­ing to leap past Roche — and leave Gilead and Bris­tol My­ers be­hind — in the race to TIG­IT dom­i­na­tion?

Roche caused quite a stir at ASCO with its first look at some positive — but not so impressive — data for their combination of Tecentriq with their anti-TIGIT drug tiragolumab. But some analysts believe that Merck is positioned to make a bid — soon — for the lead in the race to a second-wave combo immuno-oncology approach with its own ambitious early-stage program tied to a dominant Keytruda.

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So much for a speedy review.

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In an interview with JAMA editor Howard Bauchner, NIAID chief Anthony Fauci said that a 30,000-person, Phase III trial for Moderna’s vaccine could start in July. The news comes a week after Moderna began a Phase II study that will enroll several hundred people.

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