PacBio en­gi­neers $800M buy­out of se­quenc­ing ri­val Om­niome as an­a­lysts fret over FTC ac­tion

As Il­lu­mi­na runs in­to an­oth­er reg­u­la­to­ry road­block to ex­pan­sion, one of its al­most-sub­sidiaries is charg­ing ahead with a new buy­out.

Pa­cif­ic Bio­sciences, of­ten re­ferred to as PacBio, is aim­ing to swal­low ri­val Om­niome in an $800 mil­lion stock and cash deal, the com­pa­nies an­nounced Tues­day morn­ing. PacBio will fork over $600 mil­lion up­front con­sist­ing of $300 mil­lion cash and 9.4 mil­lion shares, and is on the hook for an­oth­er $200 mil­lion in cash and stock should cer­tain mile­stones be achieved.

The buy­out is ex­pect­ed to close by the end of Sep­tem­ber, the com­pa­nies added. Tues­day’s news sent PacBio shares $PACB up about 3% in pre-mar­ket trad­ing, but the stock trend­ed down about 2% af­ter the open­ing bell.

In con­junc­tion with the deal, PacBio is sell­ing off more than 11 mil­lion shares to raise $300 mil­lion in a PIPE fi­nanc­ing round. In­vestors in­clud­ed Cas­din Cap­i­tal, Soft­Bank’s SB North­star fund and T. Rowe Price.

For PacBio, a play­er in long-read ge­net­ic se­quenc­ing tech­nol­o­gy, the ap­peal cen­tered around a bet­ter se­quenc­ing tech that can ex­pand in­to the short-read space and speed up se­quenc­ing times. With the po­ten­tial for high­er ac­cu­ra­cy with Om­niome’s plat­form, PacBio be­lieves it can po­si­tion it­self as one of the on­ly com­pa­nies able to do both types of se­quenc­ing.

“Sci­en­tists and clin­i­cal re­searchers re­ly on ac­cu­rate short reads and ac­cu­rate long reads to con­duct their sci­ence and an­swer their spe­cif­ic ques­tions,” PacBio COO Mark Van Oene said in a state­ment. “PacBio is com­mit­ted to de­liv­er­ing the most ad­vanced com­bi­na­tion of se­quenc­ing so­lu­tions to en­able the com­plete ge­nomics land­scape.”

Chris­t­ian Hen­ry

The com­pa­ny faced ques­tions from an­a­lysts in a Tues­day morn­ing in­vestor call, how­ev­er, over whether this abil­i­ty will prove to be a true dif­fer­en­ti­at­ing fac­tor, par­tic­u­lar­ly giv­en the FTC is now su­ing to block Il­lu­mi­na’s $8 bil­lion buy­out of Grail. CEO Chris­t­ian Hen­ry de­fend­ed the move, say­ing Om­niome’s se­quenc­ing ca­pa­bil­i­ties were “an or­der of mag­ni­tude” bet­ter than com­peti­tors and that alone could be enough to dif­fer­en­ti­ate.

Il­lu­mi­na’s deal came up again lat­er in ques­tion­ing, with some an­a­lysts won­der­ing whether or not the scruti­ny gar­nered in that case has PacBio con­cerned the FTC will take sim­i­lar steps here. Hen­ry again brushed off the mat­ter, say­ing that while he agrees the Grail deal has a lot of folks on edge, he doesn’t fore­see any sig­nif­i­cant holdups for the Om­niome deal.

PacBio has been in­volved in the FTC’s crosshairs in the past, even be­fore new chair Lina Khan came in with big plans to shake up the agency. When Il­lu­mi­na sought to buy out PacBio for $1.2 bil­lion in late 2018, reg­u­la­tors ac­cused the se­quenc­ing gi­ant of be­ing a “mo­nop­o­list” and the two sides tore up their merg­er agree­ment less than a month lat­er.

FTC’s five com­mis­sion­ers vot­ed unan­i­mous­ly to chal­lenge the 2018 deal.

It re­mains to be seen if the FTC will move against the Om­niome trans­ac­tion. Though the FTC is su­ing to block the Grail buy­out and has vowed to take a tougher stance on phar­ma M&A, the agency waved through As­traZeneca’s $39 bil­lion ac­qui­si­tion of Alex­ion ear­li­er this year. That merg­er is ex­pect­ed to go through this week af­ter the EU and UK reg­u­la­tors signed off this month.

Khan was not in­volved in the As­traZeneca deal, as she was on­ly con­firmed to the agency’s top post in ear­ly Ju­ly.

So­cial: via Pa­cif­ic Bio­sciences web­site

Adap­tive De­sign Meth­ods Of­fer Rapid, Seam­less Tran­si­tion Be­tween Study Phas­es in Rare Can­cer Tri­als

Rare cancers account for 22 percent of cancer diagnoses worldwide, yet there is no universally accepted definition for a “rare” cancer. Moreover, with the evolution of genomics and associated changes in categorizing tumors, some common cancers are now characterized into groups of rare cancers, each with a unique implication for patient management and therapy.

Adaptive designs, which allow for prospectively planned modifications to study design based on accumulating data from subjects in the trial, can be used to optimize rare oncology trials (see Figure 1). Adaptive design studies may include multiple cohorts and multiple tumor types. In addition, numerous adaptation methods may be used in a single trial and may facilitate a more rapid, seamless transition between study phases.

Matt Gline (L) and Pete Salzmann

UP­DAT­ED: Roivant bumps stake in Im­muno­vant with a $200M deal. But with M&A off the ta­ble, shares crater

Roivant has worked out a deal to pick up a chunk of stock in its majority-owned sub Immunovant $IMVT, but the stock buy falls far short of its much-discussed thoughts about buying out all of the 43% of shares it doesn’t already own.

Roivant, which recently inked a SPAC move to the market at a $7 billion-plus valuation, has forged a deal to boost its ownership in Immunovant by 6.3 points, ending with 63.8% of the biotech’s stock following a $200 million injection. That cash will bolster Immunovant’s cash reserves, giving it a $600 million war chest to fund a slate of late-stage studies for its big drug: the anti-FcRn antibody IMVT-1401.

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Sanofi preps a multi­bil­lion-dol­lar buy­out of an mR­NA pi­o­neer af­ter falling be­hind in the race for a Covid-19 jab — re­port

It looks like Sanofi CEO Paul Hudson is dead serious about his intention to vault directly into contention for the future of mRNA vaccines.

A year after paying Translate Bio a whopping $425 million in an upfront and equity payment to help guide the pharma giant to the promised land of mRNA vaccines for Covid-19, Sanofi is reportedly ready to close the deal with a buyout.

Translate’s stock $TBIO soared 78% after the market closed Monday. A spokesperson for Sanofi declined to comment on the report, telling Endpoints News that the company doesn’t comment on market rumors.

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Stéphane Bancel, AP Images

Mod­er­na takes on a low-risk pact with CAR-T play­er Au­to­lus for mR­NA-based can­cer drugs

Moderna’s Covid-19 vaccine has transformed the once-backwater biotech into one of the most highly valued drugmakers in the world in the span of a year. But what does the future hold for Moderna’s star turn? A small-scale discovery pact could offer a clue.

Moderna will hold exclusive rights to four mRNA-based immuno-oncology candidates using proprietary binding tech from Autolus, a biotech best known for its work on “off-the-shelf” CAR-T therapies, the partners said Monday.

UP­DAT­ED: Watch out Glax­o­SmithK­line: As­traZeneca's once-failed lu­pus drug is now ap­proved

Capping a roller coaster journey, AstraZeneca has steered its lupus drug anifrolumab across the finish line.

Saphnelo, as the antibody will be marketed, is the only treatment that’s been approved for systemic lupus erythematosus since GlaxoSmithKline’s Benlysta clinched an OK in 2011. The British drugmaker notes it’s also the first to target the type I interferon receptor.

Mirroring the population that the drug was tested on in late-stage trials, regulators sanctioned it for patients with moderate to severe cases who are already receiving standard therapy — setting up a launch planned for the end of August, according to Ruud Dobber, who’s in charge of AstraZeneca’s biopharmaceuticals business unit.

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Ipsen con­tin­ues its shop­ping spree with a $1B-plus deal for Ex­i­cure's next-gen oligonu­cleotides

Ipsen has been on a deal-making spree the last few weeks, shelling out more than a billion dollars in two separate deals to work on a mid-stage levodopa-induced dyskinesia (LID) candidate and a preclinical BAX inhibitor in several cancers. But on Monday, the company inked its largest collaboration deal yet.

Ipsen is putting down $20 million upfront and up to $1 billion in biobucks for exclusive options to two of Exicure’s discovery-stage spherical nucleic acid (SNA) treatments for Huntington’s disease and Angelman syndrome.

Not all mR­NA vac­cines are cre­at­ed equal. Does it mat­ter?; Neu­ro is back; Pri­vate M&A af­fair; and more

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As part of our broader and deeper drive, Endpoints has been pairing webinars with our special reports to cover more angles on a given topic. In conjunction with Max Gelman’s neuroscience feature, Kyle Blankenship moderated an insightful panel to discuss where the field is headed. You can register to watch it on demand here.

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Bris­tol My­ers pulls lym­phoma in­di­ca­tion for Is­to­dax af­ter con­fir­ma­to­ry tri­al falls flat

Amid an industrywide review of cancer drugs with accelerated approval, Bristol Myers Squibb had to make the tough call last month to yank an approval for leading I/O drug Opdivo after flopping a confirmatory study. Now, a second Bristol Myers drug is on the chopping block.

Bristol Myers has pulled aging HDAC inhibitor Istodax’s indication in peripheral T cell lymphoma after a Phase III confirmatory study for the drug flopped on its progression-free survival endpoint, the drugmaker said Monday.

Rick Pazdur (via AACR)

FDA's on­col­o­gy head Rick Paz­dur de­fends the ac­cel­er­at­ed ap­proval path­way, claim­ing it is 'un­der at­tack'

The FDA is sounding the alarm over its accelerated approval pathway as backlash continues over the recent nod in favor of Biogen’s Alzheimer’s drug Aduhelm, and an ODAC meeting on six such approvals that could potentially be pulled from the market — two of which already have.

“Do you think accelerated approval is under attack? I do,” Rick Pazdur, head of FDA’s Oncology Center of Excellence, said at a Friends of Cancer Research webinar on Thursday.

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