Ken Frazier, Merck CEO (Bess Adler/Bloomberg via Getty Images)

Mer­ck CEO Ken Fra­zier pre­pares to step down af­ter 29 years, hand­ing the keys to the Keytru­da race car to CFO Robert Davis

Mer­ck CEO Ken Fra­zier has seen a lot in his 29 years at the Ke­nil­worth, NJ-based drug­mak­er, but it was 2020 that gave him a true pub­lic face. Amid a spate of po­lice shoot­ings, Fra­zier emerged as a lead­ing voice in the ar­gu­ment for racial equal­i­ty in health­care and so­ci­ety writ large.

And now, just like that, he’s step­ping away from the helm he has held for 10 years — and could be look­ing at a fu­ture as a high­ly sought-af­ter el­der states­man and truth-teller.

Fra­zier will leave his role as CEO on June 30, step­ping over in­to the ex­ec­u­tive chair­man role in fa­vor of CFO Robert Davis. Davis, a four-year vet­er­an at Mer­ck, comes with a dec­o­rat­ed ré­sumé, in­clud­ing time served as CFO at Bax­ter and 14 years in the ranks at Eli Lil­ly.

Davis will take con­trol as Mer­ck looks in­to a fu­ture with­out its two lodestars — Fra­zier and Roger Perl­mut­ter, the R&D ti­tan re­spon­si­ble in large part for the suc­cess of I/O block­buster Keytru­da. Perl­mut­ter has al­ready hand­ed the reins to Dean Li, the cur­rent dis­cov­ery lead at Mer­ck, sig­nal­ing the phar­ma gi­ant’s in­tent to con­tin­ue the search for the next big Keytru­da fol­low-up. Perl­mut­ter plans to stay on in a non-ex­ec­u­tive di­rec­tor role through mid-2021.

“We have tremen­dous con­fi­dence in Rob’s abil­i­ty to con­tin­ue to fos­ter in­no­va­tion and to team with Dean Li … to dri­ve sci­en­tif­ic ex­cel­lence in­to the fu­ture,” Mer­ck’s lead in­de­pen­dent di­rec­tor Les Brun said in a state­ment. “We are par­tic­u­lar­ly pleased that Ken will con­tin­ue as ex­ec­u­tive chair­man in or­der to work with Rob and Dean to en­sure a smooth tran­si­tion for the com­pa­ny.”

Fra­zier be­gan work at Mer­ck in 1992 as VP, gen­er­al coun­sel and sec­re­tary of what was then the As­tra Mer­ck group. Fol­low­ing a se­ries of pro­mo­tions in the 1990s, Fra­zier jumped to the C-suite in No­vem­ber 2006, tak­ing on the role of ex­ec­u­tive VP and gen­er­al coun­sel. Af­ter a brief stint as VP and pres­i­dent of Mer­ck’s glob­al hu­man health branch, Fra­zier snared the pres­i­dent role in 2010 and quick­ly as­cend­ed to CEO in ear­ly 2011, where he has stayed since.

Fra­zier’s fi­nal years at Mer­ck were marked in large part by pol­i­tics — a role he was not un­fa­mil­iar with giv­en his time on the board of lob­by­ist PhRMA. In 2017, Fra­zier bailed on Pres­i­dent Don­ald Trump’s man­u­fac­tur­ing coun­cil af­ter claim­ing the pres­i­dent hadn’t done enough to con­demn white su­prema­cists who gath­ered at a Char­lottesville, VA ral­ly that claimed the life of a young white woman.

“Amer­i­ca’s lead­ers must hon­or our fun­da­men­tal val­ues by clear­ly re­ject­ing ex­pres­sions of ha­tred, big­otry and group su­prema­cy, which run counter to the Amer­i­can ide­al that all peo­ple are cre­at­ed equal,” Fra­zier said in a state­ment at the time. “As CEO of Mer­ck and as a mat­ter of per­son­al con­science, I feel a re­spon­si­bil­i­ty to take a stand against in­tol­er­ance and ex­trem­ism.”

In 2020, Fra­zier’s star as a pub­lic truth-teller on race — he is the on­ly Black man to lead one of the Big Phar­mas — rose even high­er af­ter the death of George Floyd at the hands of Min­neapo­lis po­lice in May. Fra­zier, in a poignant mo­ment, said that Floyd “could be me.”

Jump­ing on a train of pledges for racial equal­i­ty at ma­jor cor­po­ra­tions, Fra­zier pledged to join a coali­tion, dubbed OneTen, to hire 1 mil­lion black work­ers with­in 10 years. He fre­quent­ly called out the un­der­rep­re­sen­ta­tion of black work­ers across health­care, even at his own com­pa­ny.

In tan­dem with his pub­lic work, Fra­zier al­so over­saw the mas­sive suc­cess of Keytru­da, which has tak­en the on­col­o­gy space by storm on the way to $14.4 bil­lion in sales in 2020 — rank­ing just be­hind Ab­b­Vie’s im­munol­o­gy be­he­moth Hu­mi­ra. Un­like Hu­mi­ra, how­ev­er, Keytru­da’s war chest is still grow­ing at a rapid clip — 30% on the year — un­der­scor­ing the I/O drug’s vast suc­cess across a wide range of in­di­ca­tions.

Keytru­da, and par­tic­u­lar­ly Perl­mut­ter’s role in dri­ving suc­cess across its pipeline, was a salve for Fra­zier’s ear­ly years at the top of Mer­ck as prof­its stag­nat­ed in the ear­ly 2010s. Perl­mut­ter’s ar­rival in 2013 and sub­se­quent Keytru­da suc­cess re­freshed Mer­ck’s im­age, but in re­cent years an­a­lysts have wor­ried whether the com­pa­ny has tacked too much of its suc­cess to that one ther­a­py.

Li’s as­sump­tion to R&D chief could help iden­ti­fy the next big tar­get, and he and Davis will be tasked with an­swer­ing con­cerns over Mer­ck’s slim pipeline as well as how to keep Keytru­da on a growth clip as it looks to take over Hu­mi­ra’s top spot.

ZS Per­spec­tive: 3 Pre­dic­tions on the Fu­ture of Cell & Gene Ther­a­pies

The field of cell and gene therapies (C&GTs) has seen a renaissance, with first generation commercial therapies such as Kymriah, Yescarta, and Luxturna laying the groundwork for an incoming wave of potentially transformative C&GTs that aim to address diverse disease areas. With this renaissance comes several potential opportunities, of which we discuss three predictions below.

Allogenic Natural Killer (NK) Cells have the potential to displace current Cell Therapies in oncology if proven durable.

Despite being early in development, Allogenic NKs are proving to be an attractive new treatment paradigm in oncology. The question of durability of response with allogenic therapies is still an unknown. Fate Therapeutics’ recent phase 1 data for FT516 showed relatively quicker relapses vs already approved autologous CAR-Ts. However, other manufacturers, like Allogene for their allogenic CAR-T therapy ALLO-501A, are exploring novel lymphodepletion approaches to improve persistence of allogenic cells. Nevertheless, allogenic NKs demonstrate a strong value proposition relative to their T cell counterparts due to comparable response rates (so far) combined with the added advantage of a significantly safer AE profile. Specifically, little to no risk of graft versus host disease (GvHD), cytotoxic release syndrome (CRS), and neurotoxicity (NT) have been seen so far with allogenic NK cells (Fig. 1). In addition, being able to harness an allogenic cell source gives way to operational advantages as “off-the-shelf” products provide improved turnaround time (TAT), scalability, and potentially reduced cost. NKs are currently in development for a variety of overlapping hematological indications with chimeric antigen receptor T cells (CAR-Ts) today, and the question remains to what extent they will disrupt the current cell therapy landscape. Click for more details.

Lat­est news on Pfiz­er's $3B+ JAK1 win; Pacts over M&A at #JPM22; 2021 by the num­bers; Bio­gen's Aduhelm reck­on­ing; The sto­ry of sotro­vimab; 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.

For those of you who attended #JPM22 in any shape or form, we hope you had a fruitful time. Regardless of how you spent the past hectic week, may your weekend be just what you need it to be.

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A $3B+ peak sales win? Pfiz­er thinks so, as FDA of­fers a tardy green light to its JAK1 drug abroc­i­tinib

Back in the fall of 2020, newly crowned Pfizer chief Albert Bourla confidently put their JAK1 inhibitor abrocitinib at the top of the list of blockbuster drugs in the late-stage pipeline with a $3 billion-plus peak sales estimate.

Since then it’s been subjected to serious criticism for the safety warnings associated with the class, held back by a cautious FDA and questioned when researchers rolled out a top-line boast that their heavyweight contender had beaten the champ in the field of atopic dermatitis — Dupixent — in a head-to-head study.

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Robert Califf, FDA commissioner nominee (Graeme Sloan/Sipa USA/Sipa via AP Images)

Rob Califf ad­vances as Biden's FDA nom­i­nee, with a close com­mit­tee vote

Rob Califf’s second confirmation process as FDA commissioner is already much more difficult than his near unanimous confirmation under the Obama administration.

The Senate Health Committee on Thursday voted 13-8 in favor of advancing Califf’s nomination to a full Senate vote. Several Democrats voted against Califf, including Sen. Bernie Sanders and Sen. Maggie Hassan. Several other Democrats who aren’t on the committee, like West Virginia’s Joe Manchin and Ed Markey of Massachusetts, also said Thursday that they would not vote for Califf. Markey, Hassan and Manchin all previously expressed reservations about the prospect of Janet Woodcock as an FDA commissioner nominee too.

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Michel Vounatsos, Biogen CEO (World Economic Forum/Ciaran McCrickard)

Bio­gen vows to fight CM­S' draft cov­er­age de­ci­sion for Aduhelm be­fore April fi­nal­iza­tion

Biogen executives made clear in an investor call Thursday they are not preparing to run a new CMS-approved clinical trial for their controversial Alzheimer’s drug anytime soon.

As requested in a draft national coverage decision from CMS earlier this week, Biogen and other anti-amyloid drugs will need to show “a meaningful improvement in health outcomes” for Alzheimer’s patients in a randomized, placebo-controlled trial to get paid for their drugs, rather than just the reduction in amyloid plaques that won Aduhelm its accelerated approval in June.

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CRO own­er pleads guilty to ob­struct­ing FDA in­ves­ti­ga­tion in­to fal­si­fied clin­i­cal tri­al da­ta

The co-owner of a Florida-based clinical research site pleaded guilty to lying to an FDA investigator during a 2017 inspection, revealing that she falsely portrayed part of a GlaxoSmithKline pediatric asthma study as legitimate, when in fact she knew that certain data had been falsified, the Department of Justice said Wednesday.

Three other employees — Yvelice Villaman Bencosme, Lisett Raventos and Maytee Lledo — previously pleaded guilty and were sentenced in connection with falsifying data associated with the trial at the CRO Unlimited Medical Research.

Susan Galbraith, AstraZeneca EVP, Oncology R&D

Can­cer pow­er­house As­traZeneca rolls the dice on a $75M cash bet on a buzzy up­start in the on­col­o­gy field

After establishing itself in the front ranks of cancer drug developers and marketers, AstraZeneca is putting its scientific shoulder — and a significant amount of cash — behind the wheel of a brash new upstart in the biotech world.

The pharma giant trumpeted news this morning that it is handing over $75 million upfront to ally itself with Scorpion Therapeutics, one of those biotechs that was newly birthed by some top scientific, venture and executive talent and bequeathed with a fortune by way of a bankroll to advance an only hazily explained drug platform. And they are still very much in the discovery and preclinical phase.

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‘Skin­ny la­bels’ on gener­ics can save pa­tients mon­ey, re­search shows, but re­cent court de­ci­sions cloud fu­ture

New research shows how generic drug companies can successfully market a limited number of approved indications for a brand name drug, prior to coming to market for all of the indications. But several recent court decisions have created a layer of uncertainty around these so-called “skinny” labels.

While courts have generally allowed generic manufacturers to use their statutorily permitted skinny-label approvals, last summer, a federal circuit court found that Teva Pharmaceuticals was liable for inducing prescribers and patients to infringe GlaxoSmithKline’s patents through advertising and marketing practices that suggested Teva’s generic, with its skinny label, could be employed for the patented uses.

A patient in Alaska receiving an antibody infusion to prevent Covid hospitalizations in September. All but one of these treatments has been rendered useless by Omicron (Rick Bowmer/AP Images)

How a tiny Swiss lab and two old blood sam­ples cre­at­ed one of the on­ly ef­fec­tive drugs against Omi­cron (and why we have so lit­tle of it)

Exactly a decade before a novel coronavirus broke out in Wuhan, Davide Corti — a newly-minted immunologist with frameless glasses and a quick laugh — walked into a cramped lab on the top floor of an office building two hours outside Zurich. He had only enough money for two technicians and the ceiling was so low in parts that short stature was a job requirement, but Corti believed it’d be enough to test an idea he thought could change medicine.

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