J&J, Te­va and four oth­ers un­der crim­i­nal probe as feds in­ves­ti­gate opi­oid mak­ers for fail­ing to mon­i­tor dis­tri­b­u­tion

On top of hun­dreds of law­suits waged by state and lo­cal gov­ern­ments, sev­er­al ma­jor drug­mak­ers and dis­trib­u­tors are now fac­ing a fed­er­al crim­i­nal probe for their role in per­pet­u­at­ing the opi­oid cri­sis.

Fed­er­al pros­e­cu­tors in Brook­lyn are in­ves­ti­gat­ing whether phar­ma com­pa­nies have vi­o­lat­ed the Con­trolled Sub­stance Act — a pro­vi­sion nor­mal­ly re­served for drug deal­ers ac­cord­ing to ex­perts — by in­ten­tion­al­ly al­low­ing their opi­oids to flood com­mu­ni­ties, the Wall Street Jour­nal first re­port­ed. As it turned out, at least six com­pa­nies in­clud­ing J&J, Te­va, Mallinck­rodt, Am­neal and the dis­trib­u­tors McKesson and Amerisource­Ber­gen have dis­closed in re­cent SEC fil­ings that they have re­ceived grand ju­ry sub­poe­nas from the US At­tor­ney’s Of­fice for the East­ern Dis­trict of New York.

John Kapoor In­sys

No­tably, John Kapoor — the founder and for­mer chair­man of In­sys — was con­vict­ed of vi­o­lat­ing the Con­trolled Sub­stances Act but a fed­er­al judge has over­turned that part of his con­vic­tion (leav­ing charges of con­spir­a­cy, wire and mail fraud, for­fei­ture and rack­e­teer­ing in­tact).

Be­tween April and Au­gust of this year, the afore­men­tioned six com­pa­nies were asked to turn over doc­u­ments re­lat­ed to their an­ti-di­ver­sion poli­cies and pro­ce­dures and dis­tri­b­u­tion of their opi­oid med­ica­tion.

J&J and Te­va wrote that they un­der­stand the sub­poe­nas to be “part of a broad­er in­ves­ti­ga­tion in­to man­u­fac­tur­ers’ and dis­trib­u­tors’ mon­i­tor­ing pro­grams and re­port­ing un­der the Con­trolled Sub­stances Act.” The Mallinck­rodt, Am­neal and McKesson fil­ings al­so con­tained ver­sions of the state­ment, while Amerisource­Ber­gen didn’t spec­i­fy the na­ture of the probe.

Crim­i­nal charges, if they were to re­sult from the in­ves­ti­ga­tion, would mark a sig­nif­i­cant es­ca­la­tion in the le­gal tac­tics de­ployed against high-pro­file play­ers ac­cused of fu­elling the opi­oid epi­dem­ic. Ac­cord­ing to the CDC, pre­scrip­tion opi­oids led to 218,000 deaths in the US from 1999 to 2017.

Ear­li­er this year the US At­tor­ney in Man­hat­tan charged Rochester Drug Co­op­er­a­tive, the sixth-largest drug whole­saler in the US, with dis­trib­ut­ing nar­cotics that it knew “were be­ing sold and used il­lic­it­ly” and fail­ing to re­port these im­prop­er us­es to au­thor­i­ties. Two for­mer ex­ecs were al­so in­dict­ed for crim­i­nal of­fens­es.

The of­fice called the case “the first of its kind” as it es­sen­tial­ly charged a phar­ma­ceu­ti­cal dis­trib­u­tor and its ex­ecs for drug traf­fick­ing.

It’s a sig­nif­i­cant de­par­ture from the types of lit­i­ga­tion that opi­oid mak­ers such as Pur­due Phar­ma have faced, in which their ag­gres­sive sales tac­tics were blamed for caus­ing phys­i­cal and fi­nan­cial harm to the plain­tiffs. Pur­due, whose mar­ket­ing strate­gies for Oxy­Con­tin were wide­ly con­sid­ered to have plant­ed mis­con­cep­tions about the ad­dic­tive na­ture of opi­oids across the med­ical com­mu­ni­ty, has filed for bank­rupt­cy as the first step of a $10 bil­lion set­tle­ment that’s still un­der dis­pute.

John Kapoor, the high­est-rank­ing phar­ma ex­ec to be con­vict­ed in an opi­oid-re­lat­ed case so far, was most in­fa­mous for cook­ing up an elab­o­rate scheme to bribe doc­tors — go­ing so far as of­fer­ing lap dances — in­to pre­scrib­ing their pow­er­ful drug for can­cer pain, Sub­sys, to pa­tients who didn’t even have can­cer.

But a ju­ry al­so found him guilty of vi­o­lat­ing the Con­trolled Sub­stances Act. US Dis­trict Court Judge Al­li­son Bur­roughs over­turned it on Tues­day, rul­ing that pros­e­cu­tors had failed to prove that they had the in­tent to dis­trib­ute the drug for non-le­git­i­mate us­es.

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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UP­DAT­ED: Leg­end fetch­es $424 mil­lion, emerges as biggest win­ner yet in pan­dem­ic IPO boom as shares soar

Amid a flurry of splashy pandemic IPOs, a J&J-partnered Chinese biotech has emerged with one of the largest public raises in biotech history.

Legend Biotech, the Nanjing-based CAR-T developer, has raised $424 million on NASDAQ. The biotech had originally filed for a still-hefty $350 million, based on a range of $18-$20, but managed to fetch $23 per share, allowing them to well-eclipse the massive raises from companies like Allogene, Juno, Galapagos, though they’ll still fall a few dollars short of Moderna’s record-setting $600 million raise from 2018.

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As it hap­pened: A bid­ding war for an an­tibi­ot­ic mak­er in a mar­ket that has rav­aged its peers

In a bewildering twist to the long-suffering market for antibiotics — there has actually been a bidding war for an antibiotic company: Tetraphase.

It all started back in March, when the maker of Xerava (an FDA approved therapy for complicated intra-abdominal infections) said it had received an offer from AcelRx for an all-stock deal valued at $14.4 million.

The offer was well-timed. Xerava was approved in 2018, four years after Tetraphase posted its first batch of pivotal trial data, and sales were nowhere near where they needed to be in order for the company to keep its head above water.

Drug man­u­fac­tur­ing gi­ant Lon­za taps Roche/phar­ma ‘rein­ven­tion’ vet as its new CEO

Lonza chairman Albert Baehny took his time headhunting a new CEO for the company, making it absolutely clear he wanted a Big Pharma or biotech CEO with a good long track record in the business for the top spot. In the end, he went with the gold standard, turning to Roche’s ranks to recruit Pierre-Alain Ruffieux for the job.

Ruffieux, a member of the pharma leadership team at Roche, spent close to 5 years at the company. But like a small army of manufacturing execs, he gained much of his experience at the other Big Pharma in Basel, remaining at Novartis for 12 years before expanding his horizons.

Covid-19 roundup: Ab­b­Vie jumps in­to Covid-19 an­ti­body hunt; As­traZeneca shoots for 2B dos­es of Ox­ford vac­cine — with $750M from CEPI, Gavi

Another Big Pharma is entering the Covid-19 antibody hunt.

AbbVie has announced a collaboration with the Netherlands’ Utrecht University and Erasmus Medical Center and the Chinese-Dutch biotech Harbour Biomed to develop a neutralizing antibody that can treat Covid-19. The antibody, called 47D11, was discovered by AbbVie’s three partners, and AbbVie will support early preclinical work, while preparing for later preclinical and clinical development. Researchers described the antibody in Nature Communications last month.

Pfiz­er’s Doug Gior­dano has $500M — and some ad­vice — to of­fer a cer­tain breed of 'break­through' biotech

So let’s say you’re running a cutting-edge, clinical-stage biotech, probably public, but not necessarily so, which could see some big advantages teaming up with some marquee researchers, picking up say $50 million to $75 million dollars in a non-threatening minority equity investment that could take you to the next level.

Doug Giordano might have some thoughts on how that could work out.

The SVP of business development at the pharma giant has helped forge a new fund called the Pfizer Breakthrough Growth Initiative. And he has $500 million of Pfizer’s money to put behind 7 to 10 — or so — biotech stocks that fit that general description.

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Bris­tol My­ers is clean­ing up the post-Cel­gene merg­er pipeline, and they’re sweep­ing out an ex­per­i­men­tal check­point in the process

Back during the lead up to the $74 billion buyout of Celgene, the big biotech’s leadership did a little housecleaning with a major pact it had forged with Jounce. Out went the $2.6 billion deal and a collaboration on ICOS and PD-1.

Celgene, though, also added a $530 million deal — $50 million up front — to get the worldwide rights to JTX-8064, a drug that targets the LILRB2 receptor on macrophages.

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GSK presents case to ex­pand use of its lu­pus drug in pa­tients with kid­ney dis­ease, but the field is evolv­ing. How long will the mo­nop­oly last?

In 2011, GlaxoSmithKline’s Benlysta became the first biologic to win approval for lupus patients. Nine years on, the British drugmaker has unveiled detailed positive results from a study testing the drug in lupus patients with associated kidney disease — a post-marketing requirement from the initial FDA approval.

Lupus is a drug developer’s nightmare. In the last six decades, there has been just one FDA approval (Benlysta), with the field resembling a graveyard in recent years with a string of failures including UCB and Biogen’s late-stage flop, as well as defeats in Xencor and Sanofi’s programs. One of the main reasons the success has eluded researchers is because lupus, akin to cancer, is not just one disease — it really is a disease of many diseases, noted Al Roy, executive director of Lupus Clinical Investigators Network, an initiative of New York-based Lupus Research Alliance that claims it is the world’s leading private funder of lupus research, in an interview.

UP­DAT­ED: Es­ti­mat­ing a US price tag of $5K per course, remde­sivir is set to make bil­lions for Gilead, says key an­a­lyst

Data on remdesivir — the first drug shown to benefit Covid-19 patients in a randomized, controlled trial setting — may be murky, but its maker Gilead could reap billions from the sales of the failed Ebola therapy, according to an estimate by a prominent Wall Street analyst. However, the forecast, which is based on a $5,000-per-course US price tag, triggered the ire of one top drug price expert.