Mer­ck’s bad day: $310M for Not­Petya, fran­chise drugs take a hit and now the EMA push­es back on Keytru­da

Mer­ck $MRK took a se­ries of hits on Fri­day, capped by news af­ter the mar­ket closed that its Eu­ro­pean ap­pli­ca­tion for its Keytru­da/chemo com­bo for front­line non-small cell lung can­cer was be­ing scrapped in the face of a push­back from the EMA.

In the morn­ing, rolling out its Q3 num­bers, Mer­ck was forced to con­cede that the Not­Petya cy­ber at­tack had cost the com­pa­ny $135 mil­lion in lost sales along with $175 mil­lion in re­lat­ed costs while forc­ing them to bor­row $240 mil­lion worth of Gar­dasil from fed­er­al stock­piles. That ex­tra $310 mil­lion in costs will be re­peat­ed in Q4, Mer­ck not­ed in their quar­ter­ly call, as over­all dam­ages roll up to the $1 bil­lion mark.

Dur­ing the call with an­a­lysts the com­pa­ny al­so not­ed: “We’ll have to wait ul­ti­mate­ly to see more about KEYNOTE-021G be­fore we can com­ment…”

As they not­ed in their terse re­lease late Fri­day, the Eu­ro­pean ap­pli­ca­tion was based on KEYNOTE-021G and Mer­ck felt it need­ed to clar­i­fy the sit­u­a­tion ahead of the for­mal push­back no­tice from Eu­ro­pean reg­u­la­tors, prompt­ing the late state­ment.

In a note Fri­day evening, Ever­core ISI’s Umer Raf­fat says that the Eu­ro­peans have been re­luc­tant to ap­prove drugs on Phase II da­ta. The FDA, mean­while, has made that stan­dard op­er­at­ing pro­ce­dure in on­col­o­gy.

Iron­i­cal­ly, the EMA has been fine with keep­ing PTC’s Duchenne MD drug ataluren on the mar­ket fol­low­ing an ac­cel­er­at­ed ap­proval, even though it’s failed a se­ries of stud­ies and was just slapped down for the third time by the FDA, which wants to see some re­al ev­i­dence of ef­fi­ca­cy be­fore hand­ing out a green light on mar­ket­ing.

Mer­ck’s surge to the top in NSCLC in the US af­ter a sna­fu at Bris­tol-My­ers Squibb forced a stum­ble on that front has helped make Keytru­da the star fran­chise play­er for the phar­ma gi­ant. Q3 rev­enue broke the $1 bil­lion mark, mak­ing Keytru­da the sec­ond largest fran­chise drug in the port­fo­lio.

Their num­ber one drug Janu­via is ex­pe­ri­enc­ing some pric­ing pres­sure, a fea­ture that will al­so start to crimp rev­enue from Zepati­er, which is set to see rev­enue slide in the face of de­clin­ing pa­tient vol­ume as more peo­ple with hep C are cured.

In­vestors re­act­ed the same way they greet­ed com­pet­i­tive pres­sures at Cel­gene and Gilead this week. Mer­ck’s shares dropped 6% dur­ing the day, and an­oth­er 2.3% in af­ter-mar­ket trad­ing as in­vestors shook their heads over the im­pli­ca­tions.

As I re­port­ed yes­ter­day, Mer­ck is al­so sig­nal­ing that it wants to do more big deals like the one it did with As­traZeneca on the can­cer drug Lyn­parza. Keytru­da as the lone stand­out isn’t go­ing to cut it with in­vestors.

Pablo Legorreta, founder and CEO of Royalty Pharma AG, speaks at the annual Milken Institute Global Conference in Beverly Hills, California (Patrick T. Fallon/Bloomberg via Getty Images)

Cap­i­tal­iz­ing Pablo: The world’s biggest drug roy­al­ty buy­er is go­ing pub­lic. And the low-key CEO di­vulges a few se­crets along the way

Pablo Legorreta is one of the most influential players in biopharma you likely never heard of.

Over the last 24 years, Legorreta’s Royalty Pharma group has become, by its own reckoning, the biggest buyer of drug royalties in the world. The CEO and founder has bought up a stake in a lengthy list of the world’s biggest drug franchises, spending $18 billion in the process — $2.2 billion last year alone. And he’s become one of the best-paid execs in the industry, reaping $28 million from the cash flow last year while reserving 20% of the cash flow, less expenses, for himself.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 81,800+ biopharma pros reading Endpoints daily — and it's free.

As­traZeneca trum­pets the 'mo­men­tous' da­ta they found for Tagris­so in an ad­ju­vant set­ting for NSCLC — but many of the ex­perts aren’t cheer­ing along

AstraZeneca is rolling out the big guns this evening to provide a salute to their ADAURA data on Tagrisso at ASCO.

Cancer R&D chief José Baselga calls the disease-free survival data for their drug in an adjuvant setting of early stage, epidermal growth factor receptor-mutated NSCLC patients following surgery “momentous.” Roy Herbst, the principal investigator out of Yale, calls it “transformative.”

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 81,800+ biopharma pros reading Endpoints daily — and it's free.

Ab­b­Vie wins an ap­proval in uter­ine fi­broid-as­so­ci­at­ed heavy bleed­ing. Are ri­vals My­ovant and Ob­sE­va far be­hind?

Women expel on average about 2 to 3 tablespoons of blood during their time of the month. But with uterine fibroids, heavy bleeding is typical — a third of a cup or more. Drugmakers have been working on oral therapies to try and stem the flow, and as expected, AbbVie and their partners at Neurocrine Biosciences are the first to make it across the finish line.

Known chemically as elagolix, the drug is already approved as a treatment for endometriosis under the brand name Orilissa. It targets the GnRH receptor to decrease the production of estrogen and progesterone.

David Chang, Allogene CEO (Jeff Rumans)

Head­ed to PhII: Al­lo­gene CEO David Chang com­pletes a pos­i­tive ear­ly snap­shot of their off-the-shelf CAR-T pi­o­neer

Allogene CEO David Chang has completed the upbeat first portrait of the biotech’s off-the-shelf CAR-T contender ALLO-501 at virtual ASCO today, keeping all eyes on a drug that will now try to go on to replace the first-wave personalized pioneers he helped create.

The overall response rate outlined in Allogene’s abstract for treatment-resistant patients with non-Hodgkin lymphoma slipped a little from the leadup, but if you narrow the patient profile to treatment-naïve patients — removing the 3 who had previous CAR-T therapy who didn’t respond, leaving 16 — the ORR lands at 75% with a 44% complete response rate. And 9 of the 12 responders remained in response at the data cutoff, offering a glimpse on durability that still has a long way to go before it can be completely nailed down.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 81,800+ biopharma pros reading Endpoints daily — and it's free.

Pfiz­er, Mer­ck KGaA ce­ment Baven­cio blad­der can­cer win with OS da­ta — while carv­ing an­oth­er niche in rare can­cer

Pfizer and Merck KGaA have detailed the Phase III data that inspired FDA regulators to designate Bavencio a “breakthrough” for first-line advanced bladder cancer and offered an early glance at how the PD-L1 can help patients with a rare gynecological cancer — carving out niches in the checkpoint space for itself after being shut out of numerous others.

In JAVELIN Bladder 100, Bavencio led to a 31% reduction in risk of death compared to standard care alone. It also extended median survival by more than seven months — a historic feat in this setting, according to investigators at Queen Mary University of London.

Sanofi brings in 4 new ex­ec­u­tives in con­tin­ued shake-up, as vac­cines and con­sumer health chief head out the door

In the middle of Sanofi’s multi-pronged race to develop a Covid-19 vaccine, David Loew, the head of their sprawling vaccines unit, is leaving – part of the final flurry of moves in the French giant’ months-long corporate shuffle that will give them new-look leadership under new CEO Paul Hudson.

The company also said today that Alan Main, the head of their consumer healthcare unit, is out, and they named 4 executives to fill new or newly vacated positions, 3 of whom come from both outside both Sanofi and from Pharma.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 81,800+ biopharma pros reading Endpoints daily — and it's free.

Fabrice Chouraqui, Cellarity CEO-partner (LinkedIn)

Drug de­vel­op­er, Big Phar­ma com­mer­cial ex­ec, now an up­start biotech chief — Fab­rice Chouraqui is ready to try some­thing new as a ‘CEO-part­ner’ at Flag­ship

Fabrice Chouraqui’s career has taken some big twists along his life journey. He got his PharmD at Université Paris Descartes and jumped into the drug development game for a bit. Then he took a sharp turn and went back to school to get his MBA at Insead before returning to pharma on the commercial side.

Twenty years later, after steadily rising through the ranks and journeying the globe to nab a top job as president of US pharma for the Basel-based Novartis, Chouraqui exited in another career switch. And now he’s headed into a hybrid position as a CEO-partner at Flagship, where he’ll take a shot at leading Cellarity — one of the VC’s latest paradigm-changing companies of the groundbreaking model that aspires to deliver a new platform to the world of drug R&D.

Dan O'Day, Gilead CEO (Andrew Harnik, AP Images)

UP­DAT­ED: Gilead leas­es part­ner rights to TIG­IT, PD-1 in a $2B deal with Ar­cus. Now comes the hard part

Gilead CEO Dan O’Day has brokered his way to a PD-1 and lined up a front row seat in the TIGIT arena, inking a deal worth close to $2 billion to align the big biotech closely with Terry Rosen’s Arcus. And $375 million of that comes upfront, with cash for the buy-in plus equity, along with $400 million for R&D and $1.22 billion in reserve to cover opt-in payments and milestones..

Hotly rumored for weeks, the 2 players have formalized a 10-year alliance that starts with rights to the PD-1, zimberelimab. O’Day also has first dibs on TIGIT and 2 other leading programs, agreeing to an opt-in fee ranging from $200 million to $275 million on each. There’s $500 million in potential TIGIT milestones on US regulatory events — likely capped by an approval — if Gilead partners on it and the stars align on the data. And there’s another $150 million opt-in payments for the rest of the Arcus pipeline.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 81,800+ biopharma pros reading Endpoints daily — and it's free.

Paul Hudson, Sanofi CEO (Getty Images)

Sanofi CEO Paul Hud­son has $23B burn­ing a hole in his pock­et. And here are some hints on how he plans to spend that

Sanofi has reaped $11.1 billion after selling off a big chunk of its Regeneron stock at $515 a share. And now everyone on the M&A side of the business is focused on how CEO Paul Hudson plans to spend it.

After getting stung in France for some awkward politicking — suggesting the US was in the front of the line for Sanofi’s vaccines given American financial support for their work, versus little help from European powers — Hudson now has the much more popular task of managing a major cash cache to pull off something in the order of a big bolt-on. Or two.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 81,800+ biopharma pros reading Endpoints daily — and it's free.