In the hunt for a $100M IPO, Bio­haven pol­ish­es up dis­cards from Bris­tol-My­ers, As­traZeneca

Bio­haven CEO Vlad Coric

When Bio­haven Phar­ma­ceu­ti­cal spun out of Yale a few years ago, com­pa­ny ex­ec­u­tives talked a lot about their fo­cus on de­pres­sion and anx­i­ety — tough tar­gets in R&D by any ac­count. But on Fri­day the stealthy Bio­haven jumped out with a $100 mil­lion IPO fil­ing, af­ter un­der­go­ing a rad­i­cal, low-key re­vamp of its pipeline fo­cus, clear­ly aimed at of­fer­ing in­vestors a chance at a late-stage biotech eye­ing near-term FDA ap­pli­ca­tions.

Now, ac­cord­ing to the S-1, the New Haven-based biotech’s lead drug is a CGRP ther­a­py for mi­graine, a crowd­ed field in the bio­phar­ma in­dus­try with big and lit­tle com­peti­tors — Eli Lil­ly, Am­gen/No­var­tis, Te­va and Alder — lin­ing up NDAs. A num­bers-redact­ed li­cens­ing agree­ment filed just days ago re­veals Bio­haven grabbed its drug from Bris­tol-My­ers Squibb. The S-1 spells out a pact that in­cludes up to about $350 mil­lion in de­vel­op­ment and sales mile­stones, but on­ly $9 mil­lion due in 90 days of the fil­ing — $5 mil­lion of that up front.

There’s noth­ing un­usu­al about a biotech com­pa­ny grab­bing drugs off a phar­ma com­pa­ny’s shelf for mis­fit drugs. Vivek Ra­maswamy did the same with GSK when he set up Ax­o­vant $AX­ON and quick­ly turned it in­to a record-set­ting biotech IPO, af­ter tak­ing a failed Alzheimer’s drug for $5 mil­lion up­front. This is a tried and true ap­proach, which al­ways rais­es ques­tions about why these drugs, with hu­man da­ta, are so cheap to come by.

The S-1 for Bio­haven in­cludes the boast that their CGRP drug is the on­ly one to have pos­i­tive mid-stage da­ta on four key end­points rel­a­tive to place­bo. What it ap­par­ent­ly left out was that Bris­tol-My­ers al­so in­clud­ed a cheap gener­ic trip­tan — suma­trip­tan — in the mid-stage study, which beat out all three dos­es of their drug. Bris­tol-My­ers sub­se­quent­ly shelved the drug, un­til Bio­haven came along with a new plan to re­vive it in the clin­ic.

That could take some ex­plain­ing, though the S-1 notes that trip­tans are known for headache re­cur­rence and oth­er side ef­fects. Pa­tients that want to knock out a mi­graine may pre­fer a more ef­fec­tive drug, though pay­ers aren’t like­ly to be wild about cov­er­ing it as a front­line ther­a­py. Bio­haven plans to put the drug through two Phase III stud­ies in the sec­ond half of this year and then take the piv­otal da­ta to the FDA in H1 2018.

In fair­ness, the ri­vals in this field have all been com­pared to place­bos for their ef­fi­ca­cy da­ta. And Bio­haven’s Phase III specif­i­cal­ly in­cludes trip­tan-re­sis­tant pa­tients or oth­ers who would not be good can­di­dates for that class of ther­a­pies.

The in­ves­ti­ga­tors in­volved in Bio­haven al­so had fo­cused on ke­t­a­mine, a NM­DA re­cep­tor an­tag­o­nist that’s in­spired a long line­up of aca­d­e­m­ic stud­ies. The horse tran­quil­iz­er is bet­ter known in par­ty cir­cles as Spe­cial K for its psy­che­del­ic qual­i­ties.


In this case, Bio­haven in-li­censed an NM­DA an­tag­o­nist from As­traZeneca in a $210 mil­lion deal, well af­ter the phar­ma gi­ant re­treat­ed from the field. Like Bris­tol-My­ers, Bio­haven nev­er be­fore dis­closed that it did a deal with As­traZeneca, re­fer­ring on­ly to ties with blue-chip phar­mas. Co­in­ci­den­tal­ly, I cov­ered the drug — lan­icem­ine (AZD6765)  — back in 2014 when As­traZeneca un­cer­e­mo­ni­ous­ly swept it out the back door fol­low­ing a failed mid-stage study for de­pres­sion.

But in­stead of stay­ing fo­cused on de­pres­sion, the com­pa­ny took a cue from some pre­clin­i­cal mouse tests and re­pur­posed it for symp­toms of Rett syn­drome. The FDA oblig­ing­ly gave the drug, one of many NM­DA drugs, an or­phan des­ig­na­tion which comes with a set of spe­cial in­cen­tives.

Bio­haven’s mid­dle drug is from its glu­ta­mate mod­u­la­tion plat­form. The drug is called tri­grilu­zole, a re­for­mu­la­tion of rilu­zole cur­rent­ly in a Phase II/III bioe­quiv­a­lence study for the treat­ment of atax­ia with an ini­tial fo­cus on spin­ocere­bel­lar atax­ia, or SCA. Da­ta is due out in ear­ly 2018. Bio­haven ac­quired that drug from ALS Bio­phar­ma.

Cur­rent­ly based in the British Vir­gin Is­lands, Bio­haven is set­ting up a sub­sidiary in the low-tax haven of Ire­land, where the com­pa­ny will tech­ni­cal­ly move its domi­cile. It al­so has a few strings to con­sid­er with Bris­tol-My­ers and As­traZeneca, which have some claw-back pro­vi­sions in their con­tracts and a right of first ne­go­ti­a­tion if they ever come back up on the mar­ket.

Pe­ter Kolchin­sky

The com­pa­ny has burned through more than $75 mil­lion, but raised more than $100 mil­lion from a group that in­clud­ed crossover in­vestor RA Cap­i­tal, which de­lights in com­ing in­to a deal about a year ahead of what the MBA crowd likes to call a val­ue in­flec­tion point. RA’s Pe­ter Kolchin­sky was named to the board as an ob­serv­er a few weeks ago.

CEO and Yale pro­fes­sor Vlad Coric, a Bris­tol-My­ers vet with con­sid­er­able ex­pe­ri­ence in drug de­vel­op­ment, scored $784,428 in to­tal com­pen­sa­tion last year and owns 7% of the com­pa­ny. Ex­ec­u­tive chair­man De­clan Doogan runs Portage Biotech, the biggest share­hold­er and seed provider with 28.3% of the stock. Vi­vo Cap­i­tal has a 6.7% chunk and RA is in for 5.1%.

Not long ago Doogan al­so arranged to have Bio­haven in­vest in an­oth­er Yale spin­out, Kleo Phar­ma­ceu­ti­cals, which is de­vel­op­ing new ther­a­pies that re­cruit T-cells in an im­mune sys­tem at­tack on can­cer cells and oth­er tar­gets.

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His­toric drug pric­ing re­forms pass; Pfiz­er ac­quires GBT; The long search for non-opi­oid pain drugs; and more

Welcome back to Endpoints Weekly, your review of the week’s top biopharma headlines. Want this in your inbox every Saturday morning? Current Endpoints readers can visit their reader profile to add Endpoints Weekly. New to Endpoints? Sign up here.

The Endpoints Weekly has officially crossed the 60,000 mark on subscribers — thanks to all of your support. As the editorial team grows, we’ve been able to do a lot more, with many of those on display this week. Be sure to check out Lei Lei Wu’s deep dive on pain R&D. If you missed it, you may also rewatch her companion panel here.

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Gold for adults, sil­ver for in­fants: Pfiz­er's Pre­vnar 2.0 head­ed to FDA months af­ter Mer­ck­'s green light

Pfizer was first to the finish line for the next-gen pneumococcal vaccine in adults, but Merck beat its rival with a jab for children in June.

Now, two months after Merck’s 15-valent Vaxneuvance won the FDA stamp of approval for kids, Pfizer is out with some late-stage data on its 20-valent shot for infants.

Known as Prevnar 20 for adults, Pfizer’s 20vPnC will head to the FDA by the end of this year for an approval request in infants, the Big Pharma said Friday morning. Discussions with the FDA will occur first and more late-stage pediatric trials are expected to read out soon, informing the regulatory pathway in other countries and regions.

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No­var­tis re­ports two pa­tient deaths af­ter treat­ment with Zol­gens­ma

Two children with spinal muscular atrophy have died after receiving Novartis’ Zolgensma, a gene therapy designed as a one-time treatment for the rare fatal disease.

The deaths, which resulted from acute liver failure, occurred in Russia and Kazakhstan, Novartis confirmed in a statement to Endpoints News. Having notified health authorities across all the markets where Zolgensma is available, it will update the drug label “to specify that fatal acute liver failure has been reported,” a spokesperson wrote.

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House pass­es his­toric drug pric­ing re­forms, lin­ing up decades-in-the-mak­ing win for Biden and De­moc­rats

The US House of Representatives today voted along party lines (all Dems voted for it), 220-207 to pass new, wide-ranging legislation that will allow Medicare drug price negotiations for the first time ever, and cap seniors’ drug expenses to $2,000 per year and seniors’ insulin costs at $35 per month.

Setting up a major victory for President Joe Biden, representatives returned from their summer recess to pass the Inflation Reduction Act, even as many noted the bill would only modestly reduce inflation.

Senate Finance Committee Chair Ron Wyden (D-OR) (Francis Chung/E&E News/POLITICO via AP Images)

Sen­ate Fi­nance chair con­tin­ues his in­ves­ti­ga­tion in­to phar­ma tax­es with re­quests for Am­gen

Amgen is the latest pharma company to appear on the radar of Senate Finance Committee Chair Ron Wyden (D-OR), who is investigating the way pharma companies are using subsidiaries in low- or zero-tax countries to lower their tax bills.

Like its peers Merck, AbbVie and Bristol Myers Squibb, Wyden notes how Amgen uses its Puerto Rico operations to consistently pay tax rates that are substantially lower than the U.S. corporate tax rate of 21%, with an effective tax rate of 10.7% in 2020 and 12.1% in 2021.

FDA ap­proves sec­ond in­di­ca­tion for As­traZeneca and Dai­ichi's En­her­tu in less than a week

AstraZeneca and Daiichi Sankyo’s antibody-drug conjugate Enhertu scored its second approval in less than a week, this time for a subset of lung cancer patients.

Enhertu received accelerated approval on Thursday to treat adults with unresectable or metastatic non-small cell lung cancer (NSCLC) whose tumors have activating HER2 (ERBB2) mutations, and who have already received a prior systemic therapy.

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J&J to re­move talc prod­ucts from shelves world­wide, re­plac­ing with corn­starch-based port­fo­lio

After controversially spinning out its talc liabilities and filing for bankruptcy in an attempt to settle 38,000 lawsuits, Johnson & Johnson is now changing up the formula for its baby powder products.

J&J is beginning the transition to an all cornstarch-based baby powder portfolio, the pharma giant announced on Thursday — just months after a federal judge ruled in favor of its “Texas two-step” bankruptcy to settle allegations that its talc products contained asbestos and caused cancer. An appeals court has since agreed to revisit that case.

CSL is gathering its four business units under a unified brand identity strategy (Credit: CSL company site)

CSL brings Se­qirus, Vi­for un­der par­ent um­brel­la brand in iden­ti­ty re­vamp

CSL is gathering its brands under the family name umbrella, renaming its vaccine and newly acquired nephrology specialty businesses with the parent initials.

CSL Seqirus and CSL Vifor join CSL Plasma and CSL Behring as the four now uniformly branded business units of the global biopharma. The Seqirus vaccine division was formed in 2015 with the combination of bioCSL and its purchase of Novartis’ flu vaccine business. CSL picked up Vifor Pharma late last year in an $11.7 billion deal for the nephrology, iron deficiency and cardio-renal drug developer.

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