On top of ex­pir­ing Her­ceptin patents, Roche faces huge roy­al­ty loss­es in 2019

We all know some of Roche’s most valu­able patents are ex­pir­ing soon, not the least of which is the huge rev­enue-dri­ver can­cer drug Her­ceptin. But in its lat­est fi­nan­cial up­date, Roche out­lined a dif­fer­ent set of patents that will soon cut hun­dreds of mil­lions from its bal­ance sheet.

Sev­erin Schwan

In its mid-year earn­ings up­date, Roche warned in­vestors that its “Ca­bil­ly” patents —  which pro­tect a step in the man­u­fac­tur­ing process of cell-based ther­a­pies — would ex­pire in De­cem­ber. For the past 35 years, these patents (grant­ed to Roche’s Genen­tech unit in 1983), have al­lowed Roche to col­lect roy­al­ties from com­peti­tors like Ab­b­Vie, which us­es the process­es to man­u­fac­ture Hu­mi­ra. That drug sold $18.5 bil­lion last year.

The Ca­bil­ly patents have been an ob­ject of spec­u­la­tion over the years as in­vestors tried to es­ti­mate ex­act­ly how valu­able they were to Roche. But now, Roche has trot­ted out an ac­tu­al fig­ure. Last year, the patent roy­al­ties brought in $840.4 mil­lion. That will soon evap­o­rate. And the per year val­ue is high­er than an­a­lysts at Bar­clay’s Cap­i­tal as­sumed, they wrote, “which will like­ly pro­vide a stiff head­wind for 2019.”

It’s a trou­bling prob­lem to have con­sid­er­ing the fact that Roche will soon be los­ing its ex­clu­siv­i­ty on Her­ceptin, whose patent ex­pi­ra­tion is al­so in 2019. Her­ceptin sales makes up a big chunk of the Roches’s to­tal rev­enue, bring­ing in $7 bil­lion in sales last year.

It’s im­por­tant to note, how­ev­er, that Roche post­ed some promis­ing fig­ures in its H1 up­date, in­di­cat­ing that it’s mak­ing some progress com­pen­sat­ing for its up­com­ing loss­es. That’s large­ly thanks to new­ly-launched treat­ments like MS ther­a­py Ocre­vus and breast can­cer drug Per­je­ta. CEO Sev­erin Schwan said they were “well on track to re­ju­ve­nate” their port­fo­lio. The com­pa­ny re­port­ed core op­er­at­ing prof­its rose 10% to $11.3 bil­lion in the first half of the year. Sales rose 7% to $28.3 bil­lion, beat­ing an­a­lysts’ ex­pec­ta­tions.

As Nas­daq en­rolls the fi­nal batch of 2019 IPOs, how have the num­bers com­pared to past years?

IGM Biosciences’ upsized IPO haul, coming after SpringWorks’ sizable public debut, has revved up some momentum for the last rush of biotech IPOs in 2019.

With 39 new listings on the books and roughly two more months to go before winding down, Nasdaq’s head of healthcare listings Jordan Saxe sees the exchange marking 50 to 60 biopharma IPOs for the year.

“December 15 is usually the last possible day that companies will price,” he said, as companies get ready for business talks at the annual JP Morgan Healthcare Conference in January.

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A fa­vorite in Alex­ion’s C-suite is leav­ing, and some mighty sur­prised an­a­lysts aren’t the least bit hap­py about it

Analysts hate to lose a biotech CFO they’ve come to trust and admire — especially if they’re being blindsided by a surprise exit.

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David Grainger [file photo]

'Dis­con­nect the bas­tard­s' — one biotech's plan to break can­cer cell­s' uni­fied de­fens­es

Chemotherapy and radiotherapy are the current gladiators of cancer treatment, but they come with well-known limitations and side-effects. The emergence of immunotherapy — a ferocious new titan in oncologist’s toolbox — takes the brakes off the immune system to kill cancer cells with remarkable success in some cases, but the approach is not always effective. What makes certain forms of cancer so resilient? Scientists may have finally pieced together a tantalizing piece of the puzzle, and a new biotech is banking on a new approach to fill the gap.

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While No­var­tis ban­ish­es Zol­gens­ma scan­dal scars — Bio­gen goes on a Spin­raza 'of­fen­sive'

While Novartis painstakingly works to mop up the stench of the data manipulation scandal associated with its expensive gene therapy for spinal muscular atrophy (SMA) Zolgensma— rival Biogen is attempting to expand the use of its SMA therapy, Spinraza. 

The US drugmaker $BIIB secured US approval for Spinraza for use in the often fatal genetic disease in 2016. The approval covered a broad range of patients with infantile-onset (most likely to develop Type 1) SMA. 

Jason Kelly. Mike Blake/Reuters via Adobe

Eye­ing big ther­a­peu­tic push, Gink­go bags $290M to build a cell pro­gram­ming em­pire

Ginkgo Bioworks is on a roll. Days after publicizing a plan to nurture new startups via partnerships with accelerators Y Combinator and Petri, the Boston biotech says it has raised another $290 million for its cell programming platform to reach further and wider.

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UP­DAT­ED: Speak­er Nan­cy Pelosi to un­veil bill for fed­er­al­ly ne­go­ti­at­ed drug prices

After months of buzz from both sides of the aisle, Speaker Nancy Pelosi will today introduce her plan to allow the federal government to negotiate prices for 250 prescription drugs, setting up a showdown with a pharmaceutical industry working overtime to prevent it.

The need to limit drug prices is a rare point of agreement between President Trump and Democrats, although the president has yet to comment on the proposal and will likely face pressure to back a more conservative option or no bill at all. Republican Senator Chuck Grassley is reportedly lobbying his fellow party members on a more modest proposal he negotiated with Democratic Senator Ron Wyden in July.

Jeff Kindler's Cen­trex­ion re­news bid to make pub­lic de­but

Jeffrey Kindler’s plan to take his biotech — which is developing a slate of non-opioid painkillers — public, is back on.

The Boston based company, led by former Pfizer $PFE chief Kindler, originally contemplated a $70 million to $80 million IPO last year— but eventually postponed that strategy. On Wednesday, the company revived its bid to make a public debut in a filing with the SEC — although no pricing details were disclosed.

Zachary Hornby. Boundless

'A fourth rev­o­lu­tion in can­cer ther­a­pies': ARCH-backed Bound­less Bio flash­es big check, makes big­ger promis­es in de­but

It was the cellular equivalent of opening your car door and finding an active, roaring engine in the driver seat.

Scientists learned strands of DNA could occasionally appear outside of its traditional home in the nucleus in the 1970s, when they appeared as little, innocuous circles on microscopes; inexplicable but apparently innate. But not until UC San Diego’s Paul Mischel published his first study in Science in 2014 did researchers realize these circles were not only active but potentially overactive and driving some cancer tumors’ superhuman growth.

Scott Gottlieb, AP Images

Scott Got­tlieb is once again join­ing a team that en­joyed good times at the FDA un­der his high-en­er­gy stint at the helm

Right after jumping on Michael Milken’s FasterCures board on Monday, the newly departed FDA commissioner is back today with news about another life sciences board post that gives him a ringside chair to cheer on a lead player in the real-world evidence movement — one with very close ties to the FDA.

Aetion is reporting this morning that Gottlieb is joining their board, a group that includes Mohamad Makhzoumi, a general partner at New Enterprise Associates, where Gottlieb returned after stepping out of his role at the FDA 2 years after he started.

Gottlieb — one of the best connected execs in biopharma — knows this company well. As head of FDA he championed the use of real-world evidence to help guide drug developers and the agency in gaining greater efficiencies, which helped set up Aetion as a high-profile player in the game.

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