Pub­lic com­bat over US drug prices cen­ters on Prop 61 as rhetoric heats up to fever pitch

A week ago, Propo­si­tion 61 looked like a sure win­ner for its ad­vo­cates. With sen­ti­ment run­ning strong­ly against Big Phar­ma com­pa­nies, polls showed plen­ty of sup­port for a bal­lot mea­sure in Cal­i­for­nia that would cap drug prices for the state at the lev­el that the Vet­er­ans Ad­min­is­tra­tion reach­es through price ne­go­ti­a­tions.

Eli Lil­ly CEO John Lech­leit­er

But with the vote now just hours away, the in­dus­try is see­ing the polling re­sults lean­ing to a dead heat af­ter throw­ing more than $100 mil­lion in­to the fight, which is reach­ing a fever pitch in the hours be­fore fi­nal vot­ing be­gins.

As Eli Lil­ly CEO John Lech­leit­er made crys­tal clear in his Q3 call with an­a­lysts a few days ago, he and oth­er in­dus­try lead­ers are dead set against Propo­si­tion 61 for a va­ri­ety of rea­sons. Here’s what he had to say:

Prop 61, we’re fight­ing that tooth-and-nail in Cal­i­for­nia. It’s not on­ly bad leg­is­la­tion, it’s bad for your health. And we’re try­ing to im­press that on the vot­ers. What we’ve found is that the more peo­ple be­come aware of what’s at stake here and what’s the like­ly out­comes of Propo­si­tion 61, the more they’re prone to vote against it and vote it down. So we have a pret­ty big cam­paign un­der­way in Cal­i­for­nia right now to in­crease that lev­el of aware­ness and hope­ful­ly to con­tin­ue to shift vot­ers to­ward a po­si­tion of be­ing against it for a whole va­ri­ety of rea­sons.

One of the ar­gu­ments that’s be­ing thrown against the mea­sure is that the VA isn’t go­ing to find it so easy to ne­go­ti­ate the big dis­counts it’s been win­ning — around 40% — if that num­ber be­comes the cap that state pay­ers are fo­cused on. And the prospect that the end re­sult of Prop. 61 is that vets will pay more as a re­sult has helped turn the tide in Cal­i­for­nia.

But it’s im­pos­si­ble to say now who’s on top.

Pro­po­nents, mean­while, aren’t about to give up now, and they’re turn­ing up the al­ready heat­ed rhetoric. In a new re­lease out to­day, they opt­ed to vil­i­fy Lech­leit­er and a group of Big Phar­ma CEOs for their com­pa­nies’ past mar­ket­ing in­frac­tions. New 15-sec­ond ads fea­tured 6 phar­ma ex­ecs on “Want­ed” posters: Alex Gorsky at J&J; Ken Fra­zier at Mer­ck; Ian Read at Pfiz­er; Richard Gon­za­lez at Ab­b­Vie; Robert Brad­way at Am­gen and even Brent Saun­ders at Al­ler­gan, cit­ed for a 2010 vi­o­la­tion on pro­mot­ing Botox — long be­fore Saun­ders bought the com­pa­ny.

Or­ga­niz­ers say that the CEOs have “the morals and ethics of junk­yard dogs.”

Gar­ry South, a lead strate­gist who’s be­ing out­spent by about $10 to $1, cit­ed the sup­port of Bernie Sanders in the fight. He said:

Are you go­ing to trust Sen. Bernie Sanders, the Cal­i­for­nia Nurs­es Assn., AARP and Con­sumer Watch­dog, who strong­ly back Prop. 61? Or are you go­ing to trust the crim­i­nal drug com­pa­nies – con­vict­ed of all sorts of il­le­gal be­hav­ior – who are now spend­ing $126 mil­lion of their ill-got­ten gains to lie about Prop. 61?

What­ev­er hap­pens in Cal­i­for­nia, af­ter the elec­tion these same phar­ma ex­ecs are like­ly to face a gru­el­ing de­bate in Wash­ing­ton DC over drug prices, where ex­ecs from My­lan, Valeant and Tur­ing have al­ready had to face dys­pep­tic law­mak­ers. Right now, the in­dus­try will have to wait and see who comes up a win­ner on elec­tion day Tues­day. But no mat­ter who wins the votes, this is one is­sue that will not be go­ing away any­time soon.

The lat­est emails from Hillary Clin­ton’s cam­paign re­leased by Wik­iLeaks in re­cent days un­der­scores that the cam­paign tried to care­ful­ly cal­i­brate its at­tacks on phar­ma. And not all her ad­vis­ers were con­tent with the idea.

This is what Mandy Grun­wald, a se­nior com­mu­ni­ca­tions ad­vis­er, had to say when told that the cam­paign was di­al­ing down the at­tack on bio­phar­ma:

On Medicare, it’s not clear that it is ac­tu­al­ly against the law for Medicare to use its pur­chas­ing pow­er to ne­go­ti­ate for low­er prices — the way the VA does. That’s what’s com­plete­ly crazy. On Ad­ver­tis­ing, you’re miss­ing the out­rage that tax­pay­ers are help­ing to pay for those ads we all hate. On in­no­va­tion — boy I think you’ve gone too far in suck­ing up to these com­pa­nies. Re­mem­ber Joel and An­zo’s polling shows that peo­ple think these guys are big­ger vil­lains than Wall Street bankers. We should take it as a point of pride that they are go­ing to at­tack her — but her be­lief is that all com­pa­nies should be held ac­count­able if they’re rip­ping off the Amer­i­can peo­ple — whether its drug com­pa­nies or oil com­pa­nies or for prof­it col­leges or wall street….



John Reed at JPM 2019. Jeff Rumans for Endpoints News

Sanofi's John Reed con­tin­ues to re­or­ga­nize R&D, cut­ting 466 jobs while boost­ing can­cer, gene ther­a­py re­search

The R&D reorganization inside Sanofi is continuing, more than a year after the pharma giant brought in John Reed to head the research arm of the Paris-based company.
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The top 10 block­buster drugs in the late-stage pipeline — Eval­u­ate adds 6 new ther­a­pies to heavy-hit­ter list

Vertex comes in for a substantial amount of criticism for its no-holds-barred tactical approach toward wresting the price it wants for its commercial drugs in Europe. But the flip side of that coin is a highly admired R&D and commercial operation that regularly wins kudos from analysts for their ability to engineer greater cash flow from the breakthrough drugs they create.

Both aspects needed for success in this business are on display in the program backing Vertex’s triple for cystic fibrosis. VX-659/VX-445 + Tezacaftor + Ivacaftor — it’s been whittled down to 445 now — was singled out by Evaluate Pharma as the late-stage therapy most likely to win the crown for drug sales in 5 years, with a projected peak revenue forecast of $4.3 billion.

The latest annual list, which you can see here in their latest world preview, includes a roster of some of the most closely watched development programs in biopharma. And Evaluate has added 6 must-watch experimental drugs to the top 10 as drugs fail or go on to a first approval. With apologies to the list maker, I revamped this to rank the top 10 by projected 2024 sales, instead of Evaluate's net present value rankings.

It's how we roll at Endpoints News.

Here is a quick summary of the rest of the top 10:

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UP­DAT­ED: Chica­go biotech ar­gues blue­bird, Third Rock 'killed' its ri­val, pi­o­neer­ing tha­lassemia gene ther­a­py in law­suit

Blue­bird bio $BLUE chief Nick Leschly court­ed con­tro­ver­sy last week when he re­vealed the com­pa­ny’s be­ta tha­lassemia treat­ment will car­ry a jaw-drop­ping $1.8 mil­lion price tag over a 5-year pe­ri­od in Eu­rope — mak­ing it the plan­et’s sec­ond most ex­pen­sive ther­a­py be­hind No­var­tis’ $NVS fresh­ly ap­proved spinal mus­cu­lar at­ro­phy ther­a­py, Zol­gens­ma, at $2.1 mil­lion. A Chica­go biotech, mean­while, has been fum­ing at the side­lines. In a law­suit filed ear­li­er this month, Er­rant Gene Ther­a­peu­tics al­leged that blue­bird and ven­ture cap­i­tal group Third Rock un­law­ful­ly prised a vi­ral vec­tor, de­vel­oped in part­ner­ship with the Memo­r­i­al Sloan Ket­ter­ing Can­cer Cen­ter (MSK), from its grasp, and thwart­ed the de­vel­op­ment of its sem­i­nal gene ther­a­py.

John Chiminski, Catalent CEO - File Photo

'It's a growth play': Catal­ent ac­quires Bris­tol-My­er­s' Eu­ro­pean launch pad, ex­pand­ing glob­al CD­MO ops

Catalent is staying on the growth track.

Just two months after committing $1.2 billion to pick up Paragon and take a deep dive into the sizzling hot gene therapy manufacturing sector, the CDMO is bouncing right back with a deal to buy out Bristol-Myers’ central launchpad for new therapies in Europe, acquiring a complex in Anagni, Italy, southwest of Rome, that will significantly expand its capacity on the continent.

There are no terms being offered, but this is no small deal. The Anagni campus employs some 700 staffers, and Catalent is planning to go right in — once the deal closes late this year — with a blueprint to build up the operations further as they expand on oral solid, biologics, and sterile product manufacturing and packaging.

This is an uncommon deal, Catalent CEO John Chiminski tells me. But it offers a shortcut for rapid growth that cuts years out of developing a green fields project. That’s time Catalent doesn’t have as the industry undergoes unprecedented expansion around the world.

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Arc­turus ex­pands col­lab­o­ra­tion, adding $30M cash; Ku­ra shoots for $100M raise

→  Rare dis­ease play­er Ul­tragenyx $RARE is ex­pand­ing its al­liance with Arc­turus $ARCT, pay­ing $24 mil­lion for eq­ui­ty and an­oth­er $6 mil­lion in an up­front as the two part­ners ex­pand their col­lab­o­ra­tion to in­clude up to 12 tar­gets. “This ex­pand­ed col­lab­o­ra­tion fur­ther so­lid­i­fies our mR­NA plat­form by adding ad­di­tion­al tar­gets and ex­pand­ing our abil­i­ty to po­ten­tial­ly treat more dis­eases,” said Emil Kakkis, the CEO at Ul­tragenyx. “We are pleased with the progress of our on­go­ing col­lab­o­ra­tion. Our most ad­vanced mR­NA pro­gram, UX053 for the treat­ment of Glyco­gen Stor­age Dis­ease Type III, is ex­pect­ed to move in­to the clin­ic next year, and we look for­ward to fur­ther build­ing up­on the ini­tial suc­cess of this part­ner­ship.”

Neil Woodford. Woodford Investment Management via YouTube

Wood­ford braces po­lit­i­cal storm as UK fi­nan­cial reg­u­la­tors scru­ti­nize fund sus­pen­sion

The shock of Neil Wood­ford’s de­ci­sion to block with­drawals for his flag­ship fund is still rip­pling through the rest of his port­fo­lio — and be­yond. Un­der po­lit­i­cal pres­sure, UK fi­nan­cial reg­u­la­tors are now tak­ing a hard look while in­vestors con­tin­ue to flee.

In a re­sponse let­ter to an MP, the Fi­nan­cial Con­duct Au­thor­i­ty re­vealed that it’s opened an in­ves­ti­ga­tion in­to the sus­pen­sion fol­low­ing months of en­gage­ment with Link Fund So­lu­tions, which tech­ni­cal­ly del­e­gat­ed Wood­ford’s firm to man­age its funds.

Gilead baits new al­liance with $45M up­front, div­ing in­to the busy pro­tein degra­da­tion field

Gilead is jump­ing on board the pro­tein degra­da­tion band­wag­on. And they’re turn­ing to a low-pro­file Third Rock start­up for the ex­per­tise. But if you were look­ing for a trans­for­ma­tion­al deal to kick up fresh en­thu­si­asm for Gilead, you’ll have to re­main pa­tient.

This one will have a long way to go be­fore they get in­to the clin­ic.

The big biotech said Wednes­day morn­ing that it is pay­ing $45 mil­lion up­front and re­serv­ing a whop­ping $2.3 bil­lion in biotech bucks if San Fran­cis­co-based Nurix can point the way to new can­cer ther­a­pies, as well as drugs for oth­er, un­spec­i­fied dis­eases.

A new num­ber 1 drug? Keytru­da tapped to top the 10 biggest block­busters on the world stage by 2024

Analysts may be fretting about Keytruda’s longterm prospects as a host of rival therapies elbow their way to the market. But the folks at Evaluate Pharma are confident that last year’s $7 billion earner is headed for glory, tapping it to beat out the current #1 therapy Humira as AbbVie watches that franchise swoon over the next 5 years.

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In­vestor day prep at Mer­ck in­cludes a new strat­e­gy to pick up the pace on M&A — re­port

Mer­ck’s re­cent deals to buy up two bolt-on biotechs — Ti­los and Pelo­ton — weren’t an aber­ra­tion. In­stead, both ac­qui­si­tions mark a new strat­e­gy to beef up its dom­i­nant can­cer drug op­er­a­tions cen­tered on Keytru­da while look­ing to ad­dress grow­ing con­cerns that too many of its eggs are in the one I/O bas­ket for their PD-1 pro­gram. And Mer­ck is go­ing af­ter more small- and mid-sized buy­outs to calm those fears.