Il­lic­it drugs are mak­ing some big ad­vances in R&D, and Thiel part­ners at ATAI get a $43M bankroll to fu­el dri­ve on mag­ic mush­rooms, Spe­cial K

Just a few weeks af­ter the FDA of­fered phar­ma gi­ant J&J an ap­proval for its nose spray ver­sion of the par­ty drug Spe­cial K, flag­ging its will­ing­ness to low­er the gold stan­dard on drug de­vel­op­ment for a chance at adding a new ap­proach to de­pres­sion, a glob­al biotech start­up in­volved in bring­ing psy­che­del­ic med­i­cine in from the fringe just raised $43 mil­lion to build their pipeline.

Lars Wilde

ATAI Life Sci­ences is in the spot­light this morn­ing with their new round, of­fer­ing an­oth­er ex­am­ple of how some il­lic­it drugs are en­ter­ing the clin­i­cal spot­light for treat­ing psy­chi­atric con­di­tions. 

In this case, the com­pa­ny is al­so an in­vestor or own­er of two com­pa­nies that have al­ready made some progress with their lead ef­forts.

One of those com­pa­nies is Com­pass Path­ways, which be­gan test­ing psilo­cy­bin — the ac­tive in­gre­di­ent in mag­ic mush­rooms — for de­pres­sion. ATAI says it is the biggest in­vestor in Com­pass, which is re­port­ed­ly al­so backed by Pe­ter Thiel, a bil­lion­aire who’s been known to make a few con­tro­ver­sial moves in drug R&D. The biotech is run by the hus­band and wife team of George Gold­smith and Eka­te­ri­na Malievska­ia, win­ning a break­through ther­a­py des­ig­na­tion from the FDA that has helped le­git­imize its work.

Thiel isn’t the on­ly con­tro­ver­sial high roller in the game. Ex-hedge fund man­ag­er and cur­rent cryp­tocur­ren­cy ex­ec Mike Novo­gratz is al­so cred­it­ed as a backer of ATAI.


Im­age: George Gold­smith and Eka­te­ri­na Malievska­ia. COM­PASS

Com­pass be­gan re­cruit­ing healthy vol­un­teers for a study in Lon­don last sum­mer, at­tract­ing wide at­ten­tion for their work in­volv­ing a psy­che­del­ic drug with a col­or­ful his­to­ry of il­lic­it use around the world. The FDA ap­proved a Phase IIb last year as well.

“Our goal from the very be­gin­ning has been to find an ef­fec­tive treat­ment and make it avail­able through the health sys­tem to peo­ple who would nev­er take some­thing il­le­gal,” Malievska­ia told the Fi­nan­cial Times last year, say­ing she was mo­ti­vat­ed by her son, who suf­fers from se­vere de­pres­sion.

Flo­ri­an Brand

ATAI co-founder Lars Wilde is al­so COO and co-founder of Com­pass, while Flo­ri­an Brand’s CV lists his role as in­ter­im CEO at Per­cep­tion Neu­ro­science, which ATAI bought out in Jan­u­ary. Per­cep­tion has been work­ing on ar­ke­t­a­mine, its own for­mu­la­tion of the par­ty drug and horse tran­quil­iz­er ke­t­a­mine, bet­ter known in cer­tain cir­cles as Spe­cial K. 

J&J’s ri­val es­ke­t­a­mine made drug his­to­ry ear­li­er this month when the FDA ap­proved it, de­spite fail­ing a cou­ple of stud­ies and falling short of a clear gold stan­dard re­quir­ing pos­i­tive da­ta from two well-con­trolled drug tri­als for an ap­proval — a stan­dard that has de­feat­ed re­peat­ed Phase III at­tempts. Ke­t­a­mine has been in dozens of aca­d­e­m­ic stud­ies, with a proven abil­i­ty to pro­vide fast re­lief for many se­vere­ly de­pressed pa­tients. And see­ing the FDA green light the NM­DA ther­a­py for mar­ket­ing has fo­cused more at­ten­tion on the role that il­le­gal drugs can play in treat­ing psy­chi­atric con­di­tions.

Chris­t­ian Anger­may­er

ATAI’s co-founders have tout­ed an­i­mal da­ta which they say il­lus­trate their drug’s su­pe­ri­or­i­ty to es­ke­t­a­mine, a du­bi­ous strat­e­gy in the es­tab­lished R&D world. They al­so say it beat ra­pastinel, which re­cent­ly flunked a Phase III pro­gram at Al­ler­gan.

Chris­t­ian Anger­may­er, who counts him­self as a co-founder of Al­ny­lam, rounds out the founders club at ATAI.

J&J may have helped blaze the trail. But they’re al­so a glob­al play­er with a big bankroll for R&D. ATAI will now start test­ing whether oth­ers can start go­ing down the same path, with­out the big bucks and in­dus­try rep J&J has.

Michael Auer­bach’s New York-based Sub­ver­sive Cap­i­tal led the round, with Ape­iron In­vest­ment Group, Bail Cap­i­tal, and Efrem Ka­men, founder of Pu­ra Vi­da In­vest­ments jump­ing in.

Roger Perlmutter. Merck via webcast

'Our lega­cy mat­ter­s': Mer­ck maps out Keytru­da king­dom while spot­light­ing ad­vances in vac­cines, hos­pi­tal care

“You can for the mo­ment stop tak­ing notes. You can put down your pens and your pad. I have no slides. I have no sub­stan­tive da­ta. I have no pitch.”

So be­gan Roger Perl­mut­ter’s brief ap­pear­ance on­stage at Mer­ck’s first in­vestor day in five years, where he dived in­to the com­pa­ny’s his­to­ry dat­ing back to 1933. The first em­ploy­ees at Mer­ck Re­search Lab­o­ra­to­ries, hand­picked by founder George W. Mer­ck, were crit­i­cal to Mer­ck’s abil­i­ty to achieve clin­i­cal and com­mer­cial suc­cess.

Eli Casdin, Casdin Capital

Eli Cas­din backs Codex­is' plat­form tech with $50M eq­ui­ty buy

About a month af­ter Codex­is notched a deal with No­var­tis $NVS, the Cal­i­for­nia com­pa­ny $CDXS on Thurs­day said long-time in­vestor Cas­din Cap­i­tal is putting up $50 mil­lion in a pri­vate place­ment, which puts the New York-based in­vest­ment firm in con­trol of more than 5% of the pro­tein en­gi­neer­ing play­er’s stock.

Eli Cas­din start­ed his epony­mous in­vest­ment firm in 2012 and dates his re­la­tion­ship with Codex­is back to at least a decade. About three years ago, Cas­din Cap­i­tal be­gan in­vest­ing in the in­dus­tri­al biotech com­pa­ny, af­ter it piv­ot­ed its fo­cus to the life sci­ences — un­der the aus­pices of new chief John Nicols — away from the en­er­gy in­dus­try.

How small- to mid-sized biotechs can adopt pa­tient cen­tric­i­ty in their on­col­o­gy tri­als

By Lucy Clos­sick Thom­son, Se­nior Di­rec­tor of On­col­o­gy Pro­ject Man­age­ment, Icon

Clin­i­cal tri­als in on­col­o­gy can be cost­ly and chal­leng­ing to man­age. One fac­tor that could re­duce costs and re­duce bar­ri­ers is har­ness­ing the pa­tient voice in tri­al de­sign to help ac­cel­er­ate pa­tient en­roll­ment. Now is the time to adopt pa­tient-cen­tric strate­gies that not on­ly fo­cus on pa­tient needs, but al­so can main­tain cost ef­fi­cien­cy.

In­vestors pony up $476M for the lat­est round of biotech IPOs to hit the Street

Three biotechs — and a genome se­quenc­ing play­er — have caught the lat­est tide to the Gold Coast of IPOs, round­ing out the first half of 2019 with 23 new drug de­vel­op­ers mak­ing it on Nas­daq.

Most of these com­pa­nies filed their IPOs al­most si­mul­ta­ne­ous­ly, though we’re still wait­ing on word of fel­low class­mate Bridge­Bio’s pric­ing af­ter CEO Neil Ku­mar set the terms at $14 to $16 a share on Mon­day in search of a $240 mil­lion (or so) wind­fall. If he’s suc­cess­ful, that would take the one-week haul past the $700 mil­lion mark, a fresh sign that in­vestors’ en­thu­si­asm for new­ly coined pub­lic biotechs hasn’t cooled.

Robert Forrester, Verastem

Ve­rastem CEO For­rester steps to the ex­it as the board hunts com­mer­cial-savvy ex­ec for the be­lea­guered biotech

Robert For­rester is step­ping down as CEO of Ve­rastem On­col­o­gy $VSTM just 8 months af­ter the com­pa­ny nabbed an ap­proval for du­velis­ib, a PI3K drug with a sto­ried past — and what ap­pears as not much of a fu­ture.

The biotech put out word this morn­ing that For­rester will take an ad­vi­so­ry role with Ve­rastem while COO Dan Pa­ter­son steps up to take charge of the lead­er­ship team and the board looks around for a new CEO.

John Reed at JPM 2019. Jeff Rumans for Endpoints News

Sanofi's John Reed con­tin­ues to re­or­ga­nize R&D, cut­ting 466 jobs while boost­ing can­cer, gene ther­a­py re­search

The R&D reorganization inside Sanofi is continuing, more than a year after the pharma giant brought in John Reed to head the research arm of the Paris-based company.
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The top 10 block­buster drugs in the late-stage pipeline — Eval­u­ate adds 6 new ther­a­pies to heavy-hit­ter list

Vertex comes in for a substantial amount of criticism for its no-holds-barred tactical approach toward wresting the price it wants for its commercial drugs in Europe. But the flip side of that coin is a highly admired R&D and commercial operation that regularly wins kudos from analysts for their ability to engineer greater cash flow from the breakthrough drugs they create.

Both aspects needed for success in this business are on display in the program backing Vertex’s triple for cystic fibrosis. VX-659/VX-445 + Tezacaftor + Ivacaftor — it’s been whittled down to 445 now — was singled out by Evaluate Pharma as the late-stage therapy most likely to win the crown for drug sales in 5 years, with a projected peak revenue forecast of $4.3 billion.

The latest annual list, which you can see here in their latest world preview, includes a roster of some of the most closely watched development programs in biopharma. And Evaluate has added 6 must-watch experimental drugs to the top 10 as drugs fail or go on to a first approval. With apologies to the list maker, I revamped this to rank the top 10 by projected 2024 sales, instead of Evaluate's net present value rankings.

It's how we roll at Endpoints News.

Here is a quick summary of the rest of the top 10:

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Ken Frazier appears before the Senate Committee on Finance for a hearing on prescription drug pricing on Capitol Hill in Washington, DC, February 26, 2019. Chris Kleponis for CNP via AP Images

Who’s next in line to suc­ceed Ken Fra­zier as CEO of the Keytru­da-blessed Mer­ck?

When Merck waved off a looming forced retirement for Ken Frazier last September, the board cited flexibility in CEO transition as a key factor in the decision. Having Frazier — who’s also chairman of the company — around beyond his 65th birthday in 2019 would ensure they install the best person at the best time, they said.

The board has evidently begun that process with a clear preference for internal candidates, sources told Bloomberg. CFO Robert Davis, chief marketing officer Michael Nally, and chief commercial officer Frank Clyburn are all in the running, according to an insider.

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In starved an­tibi­ot­ic field, Melin­ta soars as FDA grants speedy drug re­view

Such is the state of af­fairs in an­tibi­ot­ic land that the FDA agree­ing to pri­or­i­ty re­view an ap­pli­ca­tion to ex­pand the use of an an­tibi­ot­ic can rock­et up a stock more than two-fold.

On Wednes­day, Melin­ta Ther­a­peu­tics said its ap­proved an­tibi­ot­ic Baxdela had been grant­ed pri­or­i­ty re­view for use in com­mu­ni­ty-ac­quired bac­te­r­i­al pneu­mo­nia (CAPB). The FDA is ex­pect­ed to make its de­ci­sion by Oc­to­ber 24. Shares of the Con­necti­cut drug­mak­er $ML­NT cat­a­pult­ed, clos­ing up near­ly 224% at $6.41.