Paul Edick, Xeris Pharmaceuticals CEO

Rare dis­ease play­er that went pub­lic in biotech's go-go years merges with spe­cial­ty phar­ma in all-stock deal — at a frac­tion of the de­but price

Strong­bridge Bio­phar­ma went pub­lic in the sum­mer of 2015, the tail end of a biotech boom on Nas­daq, with a sol­id pitch. Al­most 20 years old at that time, it was to fo­cus on in-li­cens­ing, de­vel­op­ing and then com­mer­cial­iz­ing treat­ments for rare dis­eases that it be­lieves has po­ten­tial to be fran­chis­es in the US and the EU with a tiny sales­force. RA Cap­i­tal, New En­ter­prise As­so­ci­ates and Long­wood Cap­i­tal were among its in­vestors.

That was good enough for rais­ing $25 mil­lion at $10 apiece. Six years lat­er, with one ap­proved ther­a­py in its port­fo­lio, it’s sell­ing for the equiv­a­lent of $2.72 per share in an all-stock deal.

Tech­ni­cal­ly, Strong­bridge is merg­ing with Xeris Phar­ma­ceu­ti­cals, whose spe­cial­ty is for­mu­lat­ing drugs in­to ready-to-use in­jec­tions, such as a glucagon in­jec­tion they mar­ket as Gvoke. But it is the Xeris brand that will live on. For each Strong­bridge share, stock­hold­ers will be re­ceiv­ing 0.7840 shares of Xeris — which, based on its clos­ing share price last Fri­day, trans­lates to a 12.9% pre­mi­um to Strong­bridge’s $2.41.

Add a $1 CVR con­tin­gent up­on sales mile­stones, and the deal val­ues Strong­bridge at $267 mil­lion.

Ac­cord­ing to the com­pa­ny’s lat­est 10-Q, it will al­so bring rough­ly $73.9 mil­lion in cash and cash equiv­a­lents to the ta­ble. Strong­bridge has spent the past few years shed­ding the last ties to its di­a­betes roots and re­mak­ing it­self as a rare dis­ease fo­cused com­pa­ny, quick­ly flip­ping the growth hor­mone drug Macrilen to No­vo Nordisk just months af­ter ac­quir­ing it from Aeter­na Zen­taris back in 2018.

The two com­pa­nies dis­closed in an SEC doc­u­ment that they be­gan talks ear­li­er this year. Paul Edick, CEO of Xeris who will al­so head the com­bined en­ti­ty, said the merg­er adds an “at­trac­tive rare dis­ease port­fo­lio and ca­pa­bil­i­ties.”

John John­son

“Through this com­bi­na­tion with Xeris, we will gain ad­di­tion­al scale and fi­nan­cial re­sources to bet­ter meet the un­met needs of those we serve,” said Strong­bridge CEO John John­son, who will now be­come a board mem­ber of Xeris.

In ad­di­tion to Keveyis (dichlor­phenamide), a treat­ment for a neu­ro­mus­cu­lar dis­or­der called pri­ma­ry pe­ri­od­ic paral­y­sis that brought in $30.7 mil­lion in 2020 and $8.4 mil­lion in the first quar­ter of 2021, Strong­bridge has re­cent­ly put le­voke­to­cona­zole in front of the FDA, with a PDU­FA date set for the first day of next year.

The drug has come a long way. Orig­i­nal­ly dubbed COR-003, the cor­ti­sol syn­the­sis in­hibitor (which was a sin­gle enan­tiomer of the old drug ke­to­cona­zole) had al­ready en­tered Phase III back in 2015 for Cush­ing’s syn­drome.

Strong­bridge’s orig­i­nal plan for seek­ing reg­u­la­to­ry ap­proval, ac­cord­ing to its F-1, was slat­ed for the sec­ond half of 2017.

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.

Marianne De Backer (L) and Jeff Hatfield

Bay­er nabs star biotech Vi­vid­ion with a $2B buy­out and an ‘arms-length’ pact, pulling a part­ner out of the IPO con­ga line

Vividion is canceling that IPO it filed. Instead of following the industry-wide migration to Nasdaq, the biotech that has captured considerable attention for its still-preclinical work finding cryptic pockets to bind to on proteins is going to work for Bayer now.

The pharma giant is putting out word today that it has bought out Vividion for $1.5 billion in cash and another half-billion dollars in milestones.

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Josh Hoffman, outgoing Zymergen CEO (Zymergen)

UP­DAT­ED: Syn­bio uni­corn Zymer­gen jet­ti­sons found­ing CEO, cuts guid­ance as cus­tomers re­port lead prod­uct does­n't work

Zymergen, just months off a $500 million IPO that put the synthetic bio firm in rarified air, has now ejected its founding CEO and downgraded its revenue forecasts after customers reported its lead film product doesn’t work as advertised, the company said Tuesday afternoon.

CEO Josh Hoffman will leave his role and sacrifice his board seat immediately in favor of Jay Flatley, the former CEO of Illumina who will take the lead role on an interim basis as the company conducts a search for its next leader.

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Paul Hudson, Sanofi CEO (Eric Piermont/AFP via Getty Images)

UP­DAT­ED: Sanofi buys mR­NA play­er Trans­late Bio for $3.2B. And the price fits a pop­u­lar range for biotech M&A

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 $TBIO a whopping $425 million in an upfront and equity payment to help guide the pharma giant to the promised land of mRNA vaccines, Sanofi closed the deal with a buyout early Tuesday, spending $38 a share in a $3.2 billion buyout.

Translate’s stock $TBIO soared after the market closed Monday when Reuters reported the first word of the acquisition just hours ahead of the formal announcement. The wire service, though, didn’t have a price to report in its scoop, and investors chased the stock up 78% in the wild ride that followed. Once the price was announced, gains shriveled to 29% ahead of the bell.

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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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Zymergen co-founders Zach Serber, Josh Hoffman, and Jed Dean (Zymergen via website)

Zymer­gen's sud­den im­plo­sion shocked biotech. A lin­ger­ing loan could make things even worse

As former synbio unicorn Zymergen picks up the pieces from its spectacular implosion Tuesday, an outstanding loan from Perceptive Advisors — the only blue-chip biotech crossover investor to touch Zymergen’s fundraising efforts — could make the situation worse, according to public documents.

In December 2019, more than a year before Zymergen filed for what would eventually become a $500 million IPO, the “biofacturing” firm signed a $100 million credit facility with Perceptive to help supplement the nearly $700 million the company had raised across four VC rounds.

Bio­gen, Ei­sai are push­ing for an­oth­er ac­cel­er­at­ed Alzheimer's OK — this time for BAN2401

Now that the door at the FDA has been opened wide for Alzheimer’s drugs that can demonstrate a reduction in amyloid, Biogen and its partners at Eisai are pushing for a quick OK on the next drug to follow in the controversial path of aducanumab.

In a presentation to analysts, Eisai neurology chief Ivan Cheung outlined some bullish expectations for their newly-approved treatment and set the stage for what he believes will be a fast follow for BAN2401 (lecanemab) — after a dry spell in new drug development that’s lasted close to 20 years.

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Masayoshi Son, SoftBank CEO (glen photo/Shutterstock)

Soft­Bank claims $5B stake in Roche amid grand plans to in­vest in biotech — re­ports

SoftBank has made a somewhat surprising choice in its bid to pour billions into biotech and healthcare.

The Japanese behemoth has quietly acquired a $5 billion stake in Roche, making it one of the Swiss pharma giant’s largest investors, Bloomberg reported. The Financial Times later confirmed the news.

The move marks a significant departure from SoftBank’s previous strategy of channeling biotech investments through its Vision Fund into early-stage startups such as Vir, Sana, XtalPi, Umoja and Exscientia. It also placed a sizable bet on Roivant back in 2017, leading a $1.1 billion round, long before Vivek Ramaswamy and his successor, Matt Gline, landed a SPAC merger at a valuation of $7 billion.

Samantha Du, Zai Lab CEO (Zai Lab)

Saman­tha Du's Zai Lab inks sur­pris­ing re­search col­lab with Schrödinger for DNA dam­age drug

Headed by Samantha Du, Chinese oncology specialist Zai Lab has made no qualms about its aggressive in-licensing strategy to drive Western drugs into regional markets. That strategy has been profitable so far, but that doesn’t mean Du’s team isn’t willing to try something new.

In a surprising volte-face, Zai Lab has signed its name to a research collaboration with physics-based discovery outfit Schrödinger looking for an oncology candidate targeting the DNA damage repair pathway, the partners said Wednesday.