Lit­tle Aziyo is grow­ing a new re­gen­er­a­tive med com­pa­ny, led by some fa­mil­iar faces in the biz

C Ran­dal Mills

A few days ago, the small re­gen­er­a­tive med­i­cine com­pa­ny Aziyo Bi­o­log­ics re­port­ed to the SEC that it had raised $12 mil­lion, just as it was in the process of buy­ing out a small, Geor­gia-based com­pa­ny called Cor­Ma­trix Car­dio­vas­cu­lar.

The deal put to­geth­er some very fa­mil­iar faces in the re­gen­er­a­tive med­i­cine world with close ties to Osiris Ther­a­peu­tics, one of the pi­o­neers in re­gen­er­a­tive med­i­cine which has been strug­gling to re­state sev­er­al years of earn­ings — a strug­gle that spurred Nas­daq re­cent­ly to kick the stock over to the Pink Sheets.

The soon-to-de­part head of the Cal­i­for­nia In­sti­tute for Re­gen­er­a­tive Med­i­cine, C. Ran­dal Mills, is one of the di­rec­tors at Aziyo, ac­cord­ing to their SEC fil­ing. He was CEO at Osiris for 10 years, and in 2013 he hand­ed the reins to Lode De­bra­ban­dere, who abrupt­ly de­part­ed from Osiris in Feb­ru­ary, 2016, as the ac­count­ing mess be­gan to heat up and af­ter its au­di­tor pulled out cit­ing its un­re­li­able num­bers. The stock was be­ing dec­i­mat­ed in the process, drop­ping 40% in a mat­ter of weeks.

Now, De­bra­ban­dere is CEO at the pri­vate­ly held Aziyo.

Backed by New York eq­ui­ty firm High­Cape Part­ners’ Kevin Rakin, Aziyo was a spin­off of a non­prof­it group called Tis­sue Banks In­ter­na­tion­al. With fund­ing from High­Cape as well as Deer­field, Aziyo start­ed out with TBI’s mus­cu­loskele­tal di­vi­sion in late 2015, look­ing to com­mer­cial­ize the work. That’s when the chair­man of TBI, C. Ran­dal Mills, joined the board at Aziyo, 18 months af­ter he was named chief of CIRM, a tax­pay­er sup­port­ed ef­fort that has in­vest­ed bil­lions in stem cell re­search work.

Ear­ly last year, De­bra­ban­dere was forced to take the de­fen­sive as Osiris was hit with a short at­tack on Seek­ing Al­pha. That fol­lowed the De­cem­ber 14, 2015 res­ig­na­tion of BDO. Ac­cord­ing to an SEC fil­ing:

BDO ad­vised that their opin­ion on the ef­fec­tive­ness of the Com­pa­ny’s in­ter­nal con­trols over fi­nan­cial re­port­ing as of De­cem­ber 31, 2014 should no longer be re­lied up­on due to man­age­ment’s iden­ti­fi­ca­tion of a ma­te­r­i­al weak­ness in in­ter­nal con­trols over fi­nan­cial re­port­ing re­lat­ed to the tim­ing of rev­enue recog­ni­tion un­der cer­tain dis­tri­b­u­tion con­tracts.

Mills has said he’ll be leav­ing CIRM at the end of this month, a lit­tle more than three years af­ter tak­ing the helm. CIRM’s fu­ture is un­cer­tain as crit­i­cism builds over the lack of much tan­gi­ble suc­cess in de­vel­op­ing new stem cell ther­a­pies. Osiris has re­stat­ed its 2014 num­bers and is now work­ing on fin­ish­ing that task un­der a new CEO.

Aziyo’s De­bra­ban­dere, though, says that com­pa­ny is just get­ting start­ed.

“Since Aziyo Bi­o­log­ics was cre­at­ed late 2015, we have fo­cused on cre­at­ing a new breed of re­gen­er­a­tive med­i­cine com­pa­ny,” De­bra­ban­dere said in a state­ment af­ter the Cor­Ma­trix deal. “Our goal has al­ways been to take lead­ing edge re­search and sci­ence and make it com­mer­cial­ly vi­able. By com­bin­ing our ex­ist­ing man­u­fac­tur­ing, com­mer­cial and re­search ca­pa­bil­i­ties with the Cor­Ma­trix peo­ple and prod­ucts, we have made a huge step to­wards that goal, lit­er­al­ly overnight.”

Albert Bourla 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

UP­DAT­ED: Pfiz­er CEO Al­bert Bourla is back in the M&A game, but why is he pay­ing $11.4B for Ar­ray?

Pfiz­er $PFE has cut short its time on the side­lines of bio­phar­ma M&A.

Mon­day morn­ing the phar­ma gi­ant un­veiled an $11.4 bil­lion deal to ac­quire Ar­ray Bio­Phar­ma, beef­ing up its on­col­o­gy work and adding a new re­search hub in Boul­der, Col­orado to its glob­al op­er­a­tions.

At $48 a share, Ar­ray $AR­RY in­vestors will be get­ting a 62% pre­mi­um off the Fri­day close of $29.59.

Pfiz­er, which has strug­gled to gain all the up­side promised in past buy­outs like Medi­va­tion, high­light­ed the ac­qui­si­tion of 2 ap­proved drugs in the deal — Braftovi (en­co­rafenib) and Mek­tovi (binime­tinib).

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Gene ther­a­py R&D deals turn red hot as Big Phar­ma steps up to play

This September will mark the 20th anniversary of the death of Jesse Gelsinger, a young man suffering from X-linked genetic disease of the liver. He was killed in a gene therapy study conducted by Penn’s James Wilson, and the entire field endured a lengthy deep freeze as the field grappled with the safety issues inherent in the work.

Some thought gene therapy R&D would never survive. But it did. And this year marked a landmark approval for Zolgensma, a new gene therapy for spinal muscular atrophy Novartis priced at $2.1 million.

“Gene therapy is the hottest item on the block now. But there was a time when we first got into this trial, where there wasn’t a person in the world who believed that gene therapy would work. We have to remember that,” noted gene therapy investigator Jerry Mendell told SMA News Today.

We’re still right on the pioneering frontier when it comes to getting approvals for gene therapies and launching marketing campaigns with the European green light for bluebird's leading program last Friday underscoring the nascent nature of the field. But gene therapy R&D is booming, and has been for several years now.

The rapid growth of gene therapy clinical development is well known, but we decided to put some numbers on it, to quantify what’s going on. DealForma chief Chris Dokomajilar took a lot over the past 10 years, as the number of deals, R&D partnerships and buyouts steadily gained steam, spiking last year and on track to maintain the surge in 2019.

The upfronts and totals for the dollars on deals so far in 2019 is already close to the 2018 mark, underscoring a new phase of negotiations as the major players step up to gain a piece of the late-stage and commercial action.

Once again, we’re looking at an “overnight” biotech success story, decades in the making.

At some point, that may start to brake the numbers we’re seeing. But for now, as rivals line up to compete for frontline prominence across a range of diseases, the arrows are all pointed north.

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Exterior of the 1 million square foot Discovery Labs in Upper Merion, PA (PR Newswire)

Philadel­phia cham­pi­ons life sci­ences 'co-work­ing,' re­viv­ing for­mer GSK cam­pus in $500M makeover

In a boost to Philadel­phia’s thriv­ing life sci­ences scene, a for­mer Glax­o­SmithK­line cam­pus and a near­by site has been turned in­to what its de­vel­op­er calls “the largest cowork­ing ecosys­tem” for health­care com­pa­nies in the coun­try.

The Dis­cov­ery Labs, a com­pa­ny spawned by MLP Ven­tures, has se­lect­ed two lo­ca­tions in the King of Prus­sia area as the $500 mil­lion test case for its strat­e­gy of ac­quir­ing and con­vert­ing old phar­ma­ceu­ti­cal R&D fa­cil­i­ties world­wide. The sites add up to 1.64 mil­lion square feet.

A uni­corn stalks Wall Street in search of IPO cash; CASI Phar­ma in-li­cens­es CD19 ther­a­py from Chi­na’s Ju­ven­tas

→ A herd of up­start biotechs will look to Wall Street for some ma­jor wind­falls this week as a burst of new of­fer­ings con­tin­ues to feed cash in­to the R&D sys­tem. To­day we learned that Bridge­Bio will look to raise in the neigh­bor­hood of $225 mil­lion by of­fer­ing 15 mil­lion shares for $14 to $16 each. And they have a string of joint bookrun­ners: J.P. Mor­gan, Gold­man Sachs, Jef­feries, SVB Leerink, KKR, Piper Jaf­fray, Mizuho Se­cu­ri­ties, BMO Cap­i­tal Mar­kets and Ray­mond James. If suc­cess­ful, Bridge­Bio will emerge with a mar­ket cap of around $1.7 bil­lion. There are 5 biotechs look­ing to IPO this week, in­clud­ing Akero and Pre­vail.

UP­DAT­ED: Sanofi Gen­zyme deserts gene ther­a­py de­vel­op­er Voy­ager Ther­a­peu­tics

While gene ther­a­py com­pa­nies re­joice as the sec­tor gains trac­tion with ap­provals and a flur­ry of M&A ac­tiv­i­ty, one play­er is feel­ing the heat.

Back in 2015, Voy­ager Ther­a­peu­tics joined forces with Sanofi Gen­zyme in a deal worth up to $845 mil­lion ($100 mil­lion up­front + a po­ten­tial $745 mil­lion in mile­stones) to co-de­vel­op gene ther­a­pies for se­vere cen­tral ner­vous sys­tem dis­or­ders. But two years lat­er, the French drug­mak­er re­treat­ed, elect­ing to not pick up the op­tion to work on Voy­ager’s Parkin­son’s dis­ease pro­gram. (Last year, the FDA dis­ap­point­ed Voy­ager, telling the com­pa­ny that it was not open to an ac­cel­er­at­ed fil­ing on the Parkin­son’s drug on the ba­sis of Phase II da­ta — in­stead of re­quir­ing an ad­di­tion­al piv­otal study.)

In­vestors fret as VBI's hep B vac­cine fails key sec­ondary PhI­II study goal

Sobered by mount­ing costs, Dy­navax $DVAX last month made the de­ci­sion to fo­cus all its re­sources on its 2017-ap­proved he­pati­tis B vac­cine Hep­lisav-B, which ri­vals and su­per­sedes the ef­fi­ca­cy and con­ve­nience pro­file of GSK’s $GSK es­tab­lished En­ger­ix-B. The Cal­i­for­nia-based com­pa­ny will be on the look­out for an­oth­er com­peti­tor — VBI Vac­cines, which on Mon­day un­veiled late-stage da­ta on its hep B vac­cine: Sci-B-Vac.

John Oyler, Founder & CEO of BeiGene, at the US-China Biopharma Innovation and Investment Summit in Shanghai on October 23, 2018; Credit: Endpoints News, PharmCube

UP­DAT­ED: As Bris­tol-My­ers/Cel­gene tie up loose ends, BeiGene pock­ets $150M from PD-1 breakup

As soon as Bristol-Myers Squibb announced its $74 billion buyout for Celgene, BeiGene emerged as a prominent example of a player whose pact with the big biotech could sour, as its PD-1 candidate seems to overlap with Opdivo. After six months of suspense, the partners say they are finally bringing the 2-year-old deal to an amicable end.

BeiGene $BGNE gets $150 million for the termination in addition to full global rights to tislelizumab. In 2017 Celgene had paid $263 million in upfront license fees to develop the PD-1 inhibitor for solid cancers in the US, Europe, Japan and the rest of the world outside Asia. It also threw in a $150 million equity investment in exchange for BeiGene handling its commercial operations — think Abraxane, Revlimid and Vidaza — in China.

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Neil Woodford, Woodford Investment Management via YouTube

Un­der siege, in­vest­ment man­ag­er Wood­ford faces an­oth­er in­vest­ment shock

Em­bat­tled UK fund man­ag­er Neil Wood­ford — who has con­tro­ver­sial­ly blocked in­vestors from pulling out from his flag­ship fund to stem the blood­let­ting, af­ter a slew of dis­ap­point­ed in­vestors fled fol­low­ing a se­ries of sour bets — is now pay­ing the price for his ac­tions via an in­vestor ex­o­dus on an­oth­er fund.

Har­g­reaves Lans­down, which has in the past sold and pro­mot­ed the Wood­ford funds via its re­tail in­vest­ment plat­form, has re­port­ed­ly with­drawn £45 mil­lion — its en­tire po­si­tion — from the in­vest­ment man­ag­er’s In­come Fo­cus Fund.

Ted Love. HAVERFORD COLLEGE

Glob­al Blood Ther­a­peu­tics poised to sub­mit ap­pli­ca­tion for ac­cel­er­at­ed ap­proval, with new piv­otal da­ta on its sick­le cell dis­ease drug

Global Blood Therapeutics is set to submit an application for accelerated approval in the second-half of this year, after unveiling fresh data from a late-stage trial that showed just over half the patients given the highest dose of its experimental sickle cell disease drug experienced a statistically significant improvement in oxygen-wielding hemoglobin, meeting the study's main goal.

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