Look­ing for an I/O edge, Bris­tol-My­ers fronts $105M to part­ner with Halozyme as Roche ex­pands pact

Af­ter rack­ing up H1 sales of $2.3 bil­lion for its PD-1 star Op­di­vo, Bris­tol-My­ers Squibb is now fronting $105 mil­lion — with a trove of $1.8 bil­lion-plus in mile­stones — to see whether its huge­ly im­por­tant im­muno-on­col­o­gy fran­chise can be helped by the de­liv­ery tech de­vel­oped at Halozyme.

That’s not all for Halozyme. Right af­ter the Bris­tol-My­ers $BMY deal popped Thurs­day morn­ing, Roche {RHH­BY} un­veiled its own plan to use the de­liv­ery tech for an­oth­er tar­get of its own — ex­pand­ing on their col­lab­o­ra­tion — which it will keep un­der wraps. That adds a $30 mil­lion up-front pay­ment with an­oth­er $160 mil­lion in mile­stones, bring­ing the pack­age to­day to $2 bil­lion in the up fronts and goal cash for Halozyme $HA­LO.

Halozyme shares surged 18% as the deals lined up this morn­ing.

The San Diego-based biotech will lend its hyaluronidase en­zyme (rHuPH20) — which tem­porar­i­ly de­grades hyaluro­nan — to see if Bris­tol’s drugs can be de­liv­ered with a sub­cu­ta­neous jab in­stead of by IV. That would be a key pref­er­ence for doc­tors and pa­tients, and in the in­tense­ly com­pet­i­tive I/O field — where Bris­tol-My­ers has stum­bled — any com­pet­i­tive ad­van­tage is be­ing hot­ly pur­sued.

He­len Tor­ley, Halozyme

This new tech from Halozyme has the po­ten­tial to cre­ate “flex­i­ble and con­ve­nient treat­ment de­liv­ery op­tions,” notes Bris­tol-My­ers com­mer­cial chief Mur­do Gor­don.

PD-1 is at the top of the list of 11 tar­gets in the deal, of course, with “mul­ti­ple” ad­di­tion­al pro­grams in the deal. And the pact in­cludes plen­ty of op­tions for more in the first 5 years, with each tar­get worth a po­ten­tial $160 mil­lion in mile­stones. And there’s more mon­ey on the ta­ble for com­bo ther­a­pies — the hot fo­cus now that the pi­o­neers are out front and claim­ing mar­ket share.

There’s more to these deals than a com­pet­i­tive edge over ri­vals, Halozyme CEO He­len Tor­ley told me to­day, though that is clear­ly in play with the Bris­tol-My­ers deal. A sub­cu­ta­neous in­jec­tion is faster, eas­i­er and al­so less ex­pen­sive for pay­ers, who won’t over­look the mon­ey that can be de­duct­ed from pro­vid­ing these ex­pen­sive ther­a­pies.

These deals mark a wa­ter­shed mo­ment for Halozyme, she adds, as a re­cent FDA ap­proval for rit­ux­imab and hyaluronidase hu­man is an easy in­jec­tion has helped in­spire a line­up of po­ten­tial part­ners to knock on their doors to dis­cuss new pacts.

The deal al­so marks a big plus for  Tor­ley, who’s had to deal with stum­bles of her own. The biotech’s de­liv­ery tech in­spired its lead drug PEGPH20, which failed a fu­til­i­ty test last spring af­ter it was com­bined with Folfiri­nox and test­ed against Folfiri­nox alone in metasta­t­ic pan­cre­at­ic can­cer. Shares of Halozyme dropped 10% last fall af­ter the com­pa­ny an­nounced that Ab­b­Vie opt­ed to drop one of their part­nered pro­grams us­ing their plat­form tech with a tu­mor necro­sis fac­tor al­pha tar­get. Their Phase I study fell short of its tar­gets, forc­ing the end of the pro­gram. But they’ll con­tin­ue to work to­geth­er un­der the terms of their $153 mil­lion 2015 pact.

Brent Saunders [Getty Photos]

UP­DAT­ED: Ab­b­Vie seals $63B deal to buy a trou­bled Al­ler­gan — spelling out $1B in R&D cuts

Brent Saunders has found his way out of the current fix he’s in at Allergan $AGN. He’s selling the company to AbbVie for $63 billion in the latest example of the hot M&A market in biopharma.

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Novotech CEO Dr. John Moller

Novotech CRO Award­ed Frost & Sul­li­van Best Biotech CRO Asia-Pa­cif­ic 2019

Known in the in­dus­try as the Asia-Pa­cif­ic CRO, Novotech is now lead CRO ser­vices provider for the grow­ing num­ber of in­ter­na­tion­al biotechs se­lect­ing the re­gion for their stud­ies.

Re­flect­ing this Asia-Pa­cif­ic growth, Novotech staff num­bers are up 20% since De­cem­ber 2018 to 600 in-house clin­i­cal re­search peo­ple across a full range of ser­vices, across the re­gion.

Novotech’s ca­pa­bil­i­ties have been rec­og­nized by an­a­lysts like Frost & Sul­li­van, most re­cent­ly with the pres­ti­gious Asia-Pa­cif­ic CRO Biotech of the year award for best prac­tices in clin­i­cal re­search for biotechs for the fifth year. See oth­er awards here.

Richard Gonzalez testifying in front of Senate Finance Committee, February 2019 [AP Images]

Ab­b­Vie's $63B buy­out spot­lights the re­turn of ma­jor M&A deals — de­spite the back­lash

Big time M&A is back. But for how long?

Over the past 18 months we’ve now seen three ma­jor buy­outs an­nounced: Take­da/Shire; Bris­tol-My­ers/Cel­gene and now Ab­b­Vie/Al­ler­gan. And with this lat­est deal it’s in­creas­ing­ly clear that the sharp fall from grace suf­fered by high-pro­file play­ers which have seen their share prices blast­ed has cre­at­ed an open­ing for the growth play­ers in big phar­ma to up their game — in sharp con­trast to the pop­u­lar bolt-on deals that have been dri­ving the growth strat­e­gy at No­var­tis, Mer­ck, Roche and oth­ers.

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The top 15 mega-deals in bio­phar­ma: Ab­b­Vie and Bris­tol-My­ers ac­qui­si­tions stir fresh de­bate over what's too big to buy

The debate over what’s too big to buy in biotech is back. A number of top analysts went right after AbbVie’s rationale for the Allergan deal today, just as Bristol-Myers Squibb stirred immediate debate over the worth and wisdom of acquiring Celgene.

To help provide some added context to this discussion, we asked DealForma chief Chris Dokomajilar to look over the past decade of major M&A in biopharma to decipher the top 15 plays.

The new numbers, unadjusted for inflation, harken back to the days of the Pfizer-Wyeth buyout and Merck’s decision to absorb Schering-Plough — both triggered in 2009. The heat over those acquisitions made the big pharma mega-deal highly unpopular for most everyone — except Pfizer — as industry leaders swore off almost all but the handy bolt-on acquisition.

Until recently.

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UP­DAT­ED: In sur­prise switch, Bris­tol-My­ers is sell­ing off block­buster Ote­zla, promis­ing to com­plete Cel­gene ac­qui­si­tion — just lat­er

Apart from revealing its checkpoint inhibitor Opdivo blew a big liver cancer study on Monday, Bristol-Myers Squibb said its plans to swallow Celgene will require the sale of blockbuster psoriasis treatment Otezla to keep the Federal Trade Commission (FTC) at bay.

The announcement — which has potentially delayed the completion of the takeover to early 2020 — irked investors, triggering the New York-based drugmaker’s shares to tumble Monday morning in premarket trading.

Celgene’s Otezla, approved in 2014 for psoriasis and psoriatic arthritis, is a rising star. It generated global sales of $1.6 billion last year, up from the nearly $1.3 billion in 2017. Apart from the partial overlap of Bristol-Myers injectable Orencia, the company’s rival oral TYK2 psoriasis drug is in late-stage development, after the firm posted encouraging mid-stage data on the drug, BMS-986165, last fall. With Monday’s decision, it appears Bristol-Myers is favoring its experimental drug, and discounting Otezla’s future.

The move blindsided some analysts. Credit Suisse’s Vamil Divan noted just days ago:

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Bris­tol-My­ers star Op­di­vo fails sur­vival test in a matchup with Nex­avar aimed at shak­ing up the big HCC mar­ket

Bris­tol-My­ers Squibb has suf­fered an­oth­er painful set­back in its years-long quest to ex­pand the reach of Op­di­vo. The phar­ma gi­ant this morn­ing not­ed that their Check­mate-459 study com­par­ing Op­di­vo with Bay­er’s Nex­avar in front­line cas­es of he­pa­to­cel­lu­lar car­ci­no­ma — the most com­mon form of liv­er can­cer — failed to hit the pri­ma­ry end­point on over­all sur­vival.

This was a sig­nif­i­cant mile­stone in Bris­tol-My­ers’ tal­ly of PD-1 cat­a­lysts this year. Nex­avar (so­rafenib) has been the stan­dard of care in front­line HCC for the past decade, though Op­di­vo has been mak­ing head­way in sec­ond-line HCC cas­es, where it’s go­ing toe-to-toe with Bay­er’s Sti­var­ga (re­go­rafenib) af­ter re­cent ap­provals shook up the mar­ket.

SQZ, Ery­tech kick off $57M cell ther­a­py part­ner­ship; Jean-Paul Kress lands new CEO gig at Mor­phoSys

→ In a mar­riage of two tech­nolo­gies meant to make cell ther­a­pies more pow­er­ful, SQZ Biotech is team­ing up with France’s Ery­tech Phar­ma for a col­lab­o­ra­tion, with $57 mil­lion re­served for the first project and $50 mil­lion for each sub­se­quent ap­proval (prod­uct or in­di­ca­tion). Hav­ing ac­cess to Ery­tech’s method of fash­ion­ing ther­a­peu­tics from red blood cells, the Cam­bridge, MA-based com­pa­ny said, will am­pli­fy SQZ’s cell en­gi­neer­ing ca­pa­bil­i­ties and al­low them to de­vleop a new class of im­munomod­u­la­to­ry ther­a­pies. Its own tech — so far ap­plied in can­cer but al­so has po­ten­tial in di­a­betes — tem­po­rary dis­rupts the cell mem­brane by squeez­ing the cell, thus cre­at­ing a brief win­dow for tar­get ma­te­ri­als such as anti­gens to en­ter.

FDA re­jects Ac­er's rare dis­ease drug, asks for new tri­al — shares crater

Ac­er Ther­a­peu­tics’ bid to re­pur­pose celipro­lol — a be­ta-block­er on the mar­ket for hy­per­ten­sion — as a treat­ment for a rare, in­her­it­ed con­nec­tive tis­sue dis­or­der has hit a se­vere set­back. The New­ton, Mass­a­chu­setts-based com­pa­ny on Tues­day said the FDA re­ject­ed the drug and has asked for an­oth­er clin­i­cal tri­al.

The com­pa­ny’s shares $AC­ER cratered near­ly 77% to $4.47 in Tues­day morn­ing trad­ing.

Tasly Bio­phar­ma pitch­es long-await­ed IPO — will it trig­ger an­oth­er $1B gold rush on HKEX?

In the run up to the Hong Kong stock ex­change’s an­tic­i­pat­ed rule change — open­ing the door for Chi­nese pre-rev­enue biotechs to go pub­lic clos­er to home — more than a year ago, Tasly Bio­phar­ma was one of the big play­ers whose ru­mored in­ter­est helped stoke en­thu­si­asm for the new list­ing venue. The com­pa­ny has since kept the drum­roll rum­bling in the back­ground, rais­ing a pre-IPO round and con­vinc­ing part­ner Trans­gene to swap own­er­ship in a joint ven­ture for eq­ui­ty. Now the oth­er shoe has fi­nal­ly dropped as ex­ecs out­line plans for a pipeline dom­i­nat­ed by car­dio­vas­cu­lar drugs.