Pro­teosta­sis shares shat­tered as weak triplet da­ta in­spires a scorch­ing back­lash

You al­most have to pity Pro­teosta­sis $PTI to­day. The mi­cro-cap biotech sal­lied out in­to the stock mar­ket ear­ly in the day try­ing to float some mediocre ef­fi­ca­cy re­sults for their triple for cys­tic fi­bro­sis and got gunned down on every side. 

Al­ready quick to en­tice skep­ti­cism af­ter ear­li­er shots on goal aroused a short at­tack from Ker­ris­dale Cap­i­tal, some promi­nent an­a­lysts made short work of Pro­teosta­sis’ num­bers this morn­ing. Its share price is down 65% to an all-time low and the mar­ket cap has shriv­eled to a pal­try $76 mil­lion — less than cur­rent as­sets on hand.

That’s a far cry from the big spike of last Oc­to­ber, when some pos­i­tive dou­blet da­ta whipped up a bit of con­tro­ver­sial sup­port for the biotech — al­ways dan­ger­ous when you fac­tor in the Sturm und Drang re­ac­tions from the brigade of Ver­tex sup­port­ers out there anx­ious to mug any­thing that could com­pare with one of their cham­pi­on’s new triplets.

Ge­of­frey Porges

Even by ex­clud­ing some pa­tients from their per pro­to­col eval­u­a­tion, though, these weren’t com­pet­i­tive num­bers, and Pro­teosta­sis shares were quick­ly led to the slaugh­ter. 

Here’s Ge­of­frey Porges from SVB Leerink:

Bot­tom Line: Pro­teosta­sis’ (PTI, OP) pro­pri­etary triple ther­a­py phase I re­sults for ho­mozy­gous F508del cys­tic fi­bro­sis (CF) did not match the ef­fi­ca­cy of Ver­tex’s CF med­i­cines, and will not com­pete for our es­ti­mat­ed $10bn peak CF sales to Ver­tex. Pro­teosta­sis’ triple in­creased lung func­tion mea­sured by per­cent pre­dict­ed forced ex­pi­ra­to­ry vol­ume (FEV1) from base­line by +5%, com­pared to the +13-14% hur­dle es­tab­lished by Ver­tex.

Leerink’s Joseph Schwartz has been a bull­ish ad­vo­cate of the triples and re­mains mod­est­ly hope­ful about bet­ter num­bers with longer ther­a­py. But even Schwartz can’t swal­low da­ta points in­volv­ing tiny pa­tient num­bers.

Al­though the com­pa­ny re­port­ed an FEV ben­e­fit of 5.2% when ‘428 was added on­to Orkam­bi, some in­vestors ques­tion the FEV ben­e­fit of ‘428 be­cause the da­ta was high­ly vari­able and large­ly dri­ven by two pa­tients on place­bo who wors­ened more than one would ex­pect. Un­for­tu­nate­ly, pa­tients did not gain a sta­tis­ti­cal­ly sig­nif­i­cant im­prove­ment in FEV for both stud­ies — 10 mg or 30 mg ‘428 added to Symdeko (28 days) and 400 mg ‘801 added to Symdeko (14 days) com­pared to place­bo. How­ev­er, the pa­tients in the ‘801 + Symdeko co­hort ex­pe­ri­enced an av­er­age sweat chlo­ride im­prove­ment of -20 mM (p<0.05) com­pared to base­line. Based on to­day’s up­date, PTI will de­pri­or­i­tize their add-on study and fo­cus on their pro­pri­etary triplet and dou­blet com­bi­na­tion ther­a­py.

Will in­vestors come back for more? Many turned the chan­nel this morn­ing and don’t seem pre­pared to give this lat­est ri­val to Ver­tex’s throne an­oth­er chance.

Not on board to in­spect the da­ta was Baird’s Bri­an Sko­r­ney, who had called the Oc­to­ber re­sults vi­able. Sko­r­ney dropped cov­er­age soon af­ter the Oc­to­ber da­ta were re­leased and Pro­teosta­sis raised cash with its in­flat­ed share price.

Fangliang Zhang, AP Images

UP­DAT­ED: Leg­end fetch­es $424 mil­lion, emerges as biggest win­ner yet in pan­dem­ic IPO boom as shares soar

Amid a flurry of splashy pandemic IPOs, a J&J-partnered Chinese biotech has emerged with one of the largest public raises in biotech history.

Legend Biotech, the Nanjing-based CAR-T developer, has raised $424 million on NASDAQ. The biotech had originally filed for a still-hefty $350 million, based on a range of $18-$20, but managed to fetch $23 per share, allowing them to well-eclipse the massive raises from companies like Allogene, Juno, Galapagos, though they’ll still fall a few dollars short of Moderna’s record-setting $600 million raise from 2018.

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As it hap­pened: A bid­ding war for an an­tibi­ot­ic mak­er in a mar­ket that has rav­aged its peers

In a bewildering twist to the long-suffering market for antibiotics — there has actually been a bidding war for an antibiotic company: Tetraphase.

It all started back in March, when the maker of Xerava (an FDA approved therapy for complicated intra-abdominal infections) said it had received an offer from AcelRx for an all-stock deal valued at $14.4 million.

The offer was well-timed. Xerava was approved in 2018, four years after Tetraphase posted its first batch of pivotal trial data, and sales were nowhere near where they needed to be in order for the company to keep its head above water.

Is a pow­er­house Mer­ck team prepar­ing to leap past Roche — and leave Gilead and Bris­tol My­ers be­hind — in the race to TIG­IT dom­i­na­tion?

Roche caused quite a stir at ASCO with its first look at some positive — but not so impressive — data for their combination of Tecentriq with their anti-TIGIT drug tiragolumab. But some analysts believe that Merck is positioned to make a bid — soon — for the lead in the race to a second-wave combo immuno-oncology approach with its own ambitious early-stage program tied to a dominant Keytruda.

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Leen Kawas, Athira CEO (Athira)

Can a small biotech suc­cess­ful­ly tack­le an Ever­est climb like Alzheimer’s? Athi­ra has $85M and some in­flu­en­tial back­ers ready to give it a shot

There haven’t been a lot of big venture rounds for biotech companies looking to run a Phase II study in Alzheimer’s.

The field has been a disaster over the past decade. Amyloid didn’t pan out as a target — going down in a litany of Phase III failures — and is now making its last stand at Biogen. Tau is a comer, but when you look around and all you see is destruction, the idea of backing a startup trying to find complex cocktails to swing the course of this devilishly complicated memory-wasting disease would daunt the pluckiest investors.

GSK presents case to ex­pand use of its lu­pus drug in pa­tients with kid­ney dis­ease, but the field is evolv­ing. How long will the mo­nop­oly last?

In 2011, GlaxoSmithKline’s Benlysta became the first biologic to win approval for lupus patients. Nine years on, the British drugmaker has unveiled detailed positive results from a study testing the drug in lupus patients with associated kidney disease — a post-marketing requirement from the initial FDA approval.

Lupus is a drug developer’s nightmare. In the last six decades, there has been just one FDA approval (Benlysta), with the field resembling a graveyard in recent years with a string of failures including UCB and Biogen’s late-stage flop, as well as defeats in Xencor and Sanofi’s programs. One of the main reasons the success has eluded researchers is because lupus, akin to cancer, is not just one disease — it really is a disease of many diseases, noted Al Roy, executive director of Lupus Clinical Investigators Network, an initiative of New York-based Lupus Research Alliance that claims it is the world’s leading private funder of lupus research, in an interview.

Drug man­u­fac­tur­ing gi­ant Lon­za taps Roche/phar­ma ‘rein­ven­tion’ vet as its new CEO

Lonza chairman Albert Baehny took his time headhunting a new CEO for the company, making it absolutely clear he wanted a Big Pharma or biotech CEO with a good long track record in the business for the top spot. In the end, he went with the gold standard, turning to Roche’s ranks to recruit Pierre-Alain Ruffieux for the job.

Ruffieux, a member of the pharma leadership team at Roche, spent close to 5 years at the company. But like a small army of manufacturing execs, he gained much of his experience at the other Big Pharma in Basel, remaining at Novartis for 12 years before expanding his horizons.

Covid-19 roundup: Ab­b­Vie jumps in­to Covid-19 an­ti­body hunt; As­traZeneca shoots for 2B dos­es of Ox­ford vac­cine — with $750M from CEPI, Gavi

Another Big Pharma is entering the Covid-19 antibody hunt.

AbbVie has announced a collaboration with the Netherlands’ Utrecht University and Erasmus Medical Center and the Chinese-Dutch biotech Harbour Biomed to develop a neutralizing antibody that can treat Covid-19. The antibody, called 47D11, was discovered by AbbVie’s three partners, and AbbVie will support early preclinical work, while preparing for later preclinical and clinical development. Researchers described the antibody in Nature Communications last month.

President Donald Trump (left) and Moncef Slaoui, head of Operation Warp Speed (Alex Brandon, AP Images)

UP­DAT­ED: White House names fi­nal­ists for Op­er­a­tion Warp Speed — with 5 ex­pect­ed names and one no­table omis­sion

A month after word first broke of the Trump Administration’s plan to rapidly accelerate the development and production of a Covid-19 vaccine, the White House has selected the five vaccine candidates they consider most likely to succeed, The New York Times reported.

Most of the names in the plan, known as Operation Warp Speed, will come as little surprise to those who have watched the last four months of vaccine developments: Moderna, which was the first vaccine to reach humans and is now the furthest along of any US effort; J&J, which has not gone into trials but received around $500 million in funding from BARDA earlier this year; the joint AstraZeneca-Oxford venture which was granted $1.2 billion from BARDA two weeks ago; Pfizer, which has been working with the mRNA biotech BioNTech; and Merck, which just entered the race and expects to put their two vaccine candidates into humans later this year.

Pfiz­er’s Doug Gior­dano has $500M — and some ad­vice — to of­fer a cer­tain breed of 'break­through' biotech

So let’s say you’re running a cutting-edge, clinical-stage biotech, probably public, but not necessarily so, which could see some big advantages teaming up with some marquee researchers, picking up say $50 million to $75 million dollars in a non-threatening minority equity investment that could take you to the next level.

Doug Giordano might have some thoughts on how that could work out.

The SVP of business development at the pharma giant has helped forge a new fund called the Pfizer Breakthrough Growth Initiative. And he has $500 million of Pfizer’s money to put behind 7 to 10 — or so — biotech stocks that fit that general description.

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