One more gig: Steven Paul de­cides to ex­tend a 35-year track record with one last shot at a big de­vel­op­ment pro­gram

Steven Paul was ready to hang up the lab coat when he stepped down near the be­gin­ning of the year as CEO of the gene ther­a­py start­up Voy­ager. Af­ter 35 years spent do­ing stints as a promi­nent top in­ves­ti­ga­tor at the Na­tion­al In­sti­tute of Men­tal Health, lead­ing the ear­ly-stage neu­ro­sciences group at Eli Lil­ly and as a co-founder at Sage and Voy­ager, see­ing out his ca­reer on some high-pro­file biotech boards like Al­ny­lam seemed just right.

And then Karuna came call­ing, and yanked him right back in­to the day-to-day game of drug de­vel­op­ment.

This morn­ing Paul is step­ping out as the new chief ex­ec­u­tive of a start­up which wants to show that one of the drugs he once cham­pi­oned at Lil­ly can now be read­ied for prime time as a sig­nif­i­cant new an­ti-psy­chot­ic for schiz­o­phre­nia — and then some.

An­drew Miller

Un­til to­day, Paul was the chair­man at Karuna. But just af­ter com­plet­ing a $42 mil­lion round — with a new crossover raise in the off­ing — Paul is back as the main man in charge. He’s tak­ing the place of founder An­drew Miller, who is trans­fer­ring to a new post as chief op­er­at­ing of­fi­cer.

What brought him back to the helm? Xanome­line. 

New­ly ar­rived at Lil­ly in the ear­ly ’90s, xanome­line was one of the lead drugs Paul in­her­it­ed in the neu­ro­sciences pipeline. There was rea­son to be­lieve that the drug would im­prove symp­toms of Alzheimer’s in pa­tients, with a test­ed abil­i­ty to hit the M1 and M4 mus­carinic re­cep­tors, with some ac­tiv­i­ty on M2 and M3.

“We did see an ef­fect on mem­o­ry,” Paul told me in a pre­view of to­day’s an­nounce­ment, “sim­i­lar to Ari­cept. What was quite sur­pris­ing, we mea­sured psy­chot­ic symp­toms in a de­ment­ed el­der­ly sub­group that had psy­chosis. And what we saw was a nice dose-de­pen­dent re­duc­tion in para­noia, vo­cal out­bursts and so on, com­pared to place­bo.”

What they al­so saw was a not-so-nice set of an­ti­cholin­er­gic ad­verse ef­fects, about what you would ex­pect now in a mus­carinic re­cep­tor ag­o­nist. Lil­ly, mean­while, was off to es­tab­lish the mega-block­buster Zyprexa, and an­oth­er drug tied to se­vere weight gain and more was not in the cards.

There it would have end­ed, ex­cept for re­search sug­gest­ing that a com­bi­na­tion ap­proach adding tro­spi­um chlo­ride to the mix for a new drug they’ve dubbed KarXT could block the side ef­fects and leave the an­ti-psy­chot­ic ef­fect in place. And there’s ad­di­tion­al re­search to un­der­score its po­ten­tial in pain as a non-opi­oid. 

It’s not a big crew. Paul counts about 6 key staffers at Karuna, with plen­ty of out­sourced help. But it’s grow­ing as they plot a big Phase II to nail down ev­i­dence of ef­fi­ca­cy and safe­ty among schiz­o­phrenic pa­tients. That tri­al will get un­der­way in a cou­ple of months now, as Karuna raised more cash and lays the foun­da­tion for what could be one big piv­otal tri­al to put them­selves over the top — or join the heap of neu­ro­sciences fail­ures that have ac­cu­mu­lat­ed over the past decade.

“I worked close­ly with Steve at Sage Ther­a­peu­tics and his ex­pe­ri­ence and cre­ativ­i­ty in the field is rare,” said Bob Nelsen, man­ag­ing di­rec­tor of ARCH Ven­ture Part­ners and a board mem­ber at Karuna. “KarXT’s po­ten­tial to meet un­met pa­tient need is ex­cit­ing and Steve’s ex­pe­ri­ence is per­fect­ly aligned to sup­port Karuna’s goal of de­liv­er­ing first-in-class drugs for treat­ing psy­chosis, cog­ni­tive im­pair­ment, and pain.”

Paul has been think­ing about this for years. Now he has the chance of prov­ing this the­o­ry. And he couldn’t be more ea­ger about the op­por­tu­ni­ty.


Im­age: Steven Paul. KARUNA

Vlad Coric (Biohaven)

In an­oth­er dis­ap­point­ment for in­vestors, FDA slaps down Bio­haven’s re­vised ver­sion of an old ALS drug

Biohaven is at risk of making a habit of disappointing its investors. 

Late Friday the biotech $BHVN reported that the FDA had rejected its application for riluzole, an old drug that they had made over into a sublingual formulation that dissolves under the tongue. According to Biohaven, the FDA had a problem with the active ingredient used in a bioequivalence study back in 2017, which they got from the Canadian drugmaker Apotex.

Chas­ing Roche's ag­ing block­buster fran­chise, Am­gen/Al­ler­gan roll out Avastin, Her­ceptin knock­offs at dis­count

Let the long battle for biosimilars in the cancer space begin.

Amgen has launched its Avastin and Herceptin copycats — licensed from the predecessors of Allergan — almost two years after the FDA had stamped its approval on Mvasi (bevacizumab-awwb) and three months after the Kanjinti OK (trastuzumab-anns). While the biotech had been fielding biosimilars in Europe, this marks their first foray in the US — and the first oncology biosimilars in the country.

Seer adds ex-FDA chief Mark Mc­Clel­lan to the board; Her­cules Cap­i­tal makes it of­fi­cial for new CEO Scott Bluestein

→ On the same day it announced a $17.5 million Series C, life sciences and health data company Seer unveiled that it had lured former FDA commissioner and ex-CMS administrator Mark McClellan on to its board. “Mark’s deep understanding of the health care ecosystem and visionary insights on policy reform will be crucial in informing our thinking as we work to bring our liquid biopsy and life sciences products to market,” said Seer chief and founder Omid Farokhzad in a statement.

Daniel O'Day

No­var­tis hands off 3 pre­clin­i­cal pro­grams to the an­tivi­ral R&D mas­ters at Gilead

Gilead CEO Daniel O’Day’s new task hunting up a CSO for the company isn’t stopping the industry’s dominant antiviral player from doing pipeline deals.

The big biotech today snapped up 3 preclinical antiviral programs from pharma giant Novartis, with drugs promising to treat human rhinovirus, influenza and herpes viruses. We don’t know what the upfront is, but the back end has $291 million in milestones baked in.

Vas Narasimhan, AP Images

On a hot streak, No­var­tis ex­ecs run the odds on their two most im­por­tant PhI­II read­outs. Which is 0.01% more like­ly to suc­ceed?

Novartis CEO Vas Narasimhan is living in the sweet spot right now.

The numbers are running a bit better than expected, the pipeline — which he assembled as development chief — is performing and the stock popped more than 4% on Thursday as the executive team ran through their assessment of Q2 performance.

Year-to-date the stock is up 28%, so the investors will be beaming. Anyone looking for chinks in their armor — and there are plenty giving it a shot — right now focus on payer acceptance of their $2.1 million gene therapy Zolgensma, where it’s early days. And CAR-T continues to underperform, but Novartis doesn’t appear to be suffering from it.

So what could go wrong?

Actually, not much. But Tim Anderson at Wolfe pressed Narasimhan and his development chief John Tsai to pick which of two looming Phase III readouts with blockbuster implication had the better odds of success.

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Francesco De Rubertis

Medicxi is rolling out its biggest fund ever to back Eu­rope's top 'sci­en­tists with strange ideas'

Francesco De Rubertis built Medicxi to be the kind of biotech venture player he would have liked to have known back when he was a full time scientist.

“When I was a scientist 20 years ago I would have loved Medicxi,’ the co-founder tells me. It’s the kind of place run by and for investigators, what the Medicxi partner calls “scientists with strange ideas — a platform for the drug hunter and scientific entrepreneur. That’s what I wanted when I was a scientist.”

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Af­ter a decade, Vi­iV CSO John Pot­tage says it's time to step down — and he's hand­ing the job to long­time col­league Kim Smith

ViiV Healthcare has always been something unique in the global drug industry.

Owned by GlaxoSmithKline and Pfizer — with GSK in the lead as majority owner — it was created 10 years ago in a time of deep turmoil for the field as something independent of the pharma giants, but with access to lots of infrastructural support on demand. While R&D at the mother ship inside GSK was souring, a razor-focused ViiV provided a rare bright spot, challenging Gilead on a lucrative front in delivering new combinations that require fewer therapies with a more easily tolerated regimen.

They kept a massive number of people alive who would otherwise have been facing a death sentence. And they made money.

And throughout, John Pottage has been the chief scientific and chief medical officer.

Until now.

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H1 analy­sis: The high-stakes ta­ble in the biotech deals casi­no is pay­ing out some record-set­ting win­nings

For years the big trend among dealmakers at the major players has been centered on ratcheting down upfront payments in favor of bigger milestones. Better known as biobucks for some. But with the top 15 companies competing for the kind of “transformative” pacts that can whip up some excitement on Wall Street, with some big biotechs like Regeneron now weighing in as well, cash is king at the high stakes table.

We asked Chris Dokomajilar, the head of DealForma, to crunch the numbers for us, looking over the top 20 deals for the past decade and breaking it all down into the top alliances already created in 2019. Gilead has clearly tipped the scales in terms of the coin of the bio-realm, with its record-setting $5 billion upfront to tie up to Galapagos’ entire pipeline.

Dokomajilar notes:

We’re going to need a ‘three comma club’ for the deals with over $1 billion in total upfront cash and equity. The $100 million-plus club is getting crowded at 164 deals in the last decade with new deals being added towards the top of the chart. 2019 already has 14 deals with at least $100 million in upfront cash and equity for a total year-to-date of over $9 billion. That beats last year’s $8 billion and sets a record.

Add upfronts and equity payments and you get $11.5 billion for the year, just shy of last year’s record-setting $11.8 billion.

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Part club, part guide, part land­lord: Arie Bellde­grun is blue­print­ing a string of be­spoke biotech com­plex­es in glob­al boom­towns — start­ing with Boston

The biotech industry is getting a landlord, unlike anything it’s ever known before.

Inspired by his recent experiences scrounging for space in Boston and the Bay Area, master biotech builder, investor, and global dealmaker Arie Belldegrun has organized a new venture to build a new, 250,000 square foot biopharma building in Boston’s Seaport district — home to Vertex and a number of up-and-coming biotech players.

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