Rock­well's CEO re­fus­es to be fired, kick­ing up brawl with board that halts the com­pa­ny's stock

There’s an episode of Se­in­feld that ran in the late 90s in which George Costan­za tries — un­suc­cess­ful­ly — to break up with his girl­friend Mau­ra. “I refuse to give up on this re­la­tion­ship,” she says. “It’s like… launch­ing mis­siles from a sub­ma­rine. Both of us have to turn our keys.” When George urges her to “turn her key,” Mau­ra re­spect­ful­ly de­clines.

Robert Chioi­ni

The same sce­nario is play­ing out to­day at a mid-sized biotech just out­side of De­troit. Rock­well Med­ical’s board has vot­ed to fire its CEO Robert Chioi­ni. But the CEO won’t turn his key. He’s… un­fired him­self, al­leg­ing that Rock­well Med­ical’s board mem­bers may have vi­o­lat­ed fed­er­al se­cu­ri­ties laws by vot­ing him out. That’s be­cause the pur­pose of this par­tic­u­lar meet­ing was to dis­cuss al­le­ga­tions of breach­es of fidu­cia­ry du­ties, not to vote on fir­ing the CEO.

“As that ac­tion was not the pur­pose of the spe­cial meet­ing, the ter­mi­na­tion of the CEO, in the opin­ion of the non-con­flict­ed in­de­pen­dent di­rec­tors, was not ef­fec­tive,” writes Chioi­ni in a let­ter to share­hold­ers.

If that wasn’t enough, Rock­well Med­ical al­so fired its CFO Thomas Kle­ma, who they said was col­lud­ing with the CEO. But that’s OK, be­cause Chioi­ni al­so re­ject­ed that de­ci­sion, un­fir­ing Kle­ma short­ly af­ter via a let­ter to share­hold­ers.

“The chair­man of board is­sued a sec­ond con­flict­ing 8K this morn­ing,” Chioi­ni wrote. “There­in is ref­er­enced a board meet­ing in which it is as­sert­ed that the CFO, Thomas Kle­ma, was ter­mi­nat­ed. I have no in­for­ma­tion to sug­gest the gov­er­nance re­quire­ments to call such a meet­ing were fol­lowed. The same 8K states that the board cre­at­ed a Spe­cial Tran­si­tion Com­mit­tee com­prised of Ben­jamin Wolin, Lisa Coller­an, and John Coop­er, to pro­vide board-lev­el over­sight of the com­pa­ny’s strate­gic di­rec­tion and day-to-day op­er­a­tions dur­ing the com­pa­ny’s tran­si­tion. I have no in­for­ma­tion to sug­gest that the gov­er­nance re­quire­ments for the cre­ation of such a com­mit­tee were fol­lowed.”

This bizarre sto­ry is par­tic­u­lar­ly in­ter­est­ing in light of Chioi­ni’s salary — $850,000 an­nu­al­ly for the past three years, with to­tal com­pen­sa­tion top­ping $12 mil­lion. That’s pret­ty de­cent for a com­pa­ny that hasn’t scored any com­mer­cial sales for two prod­ucts it won FDA ap­proval for in 2014 and 2015, as not­ed by STAT colum­nist Adam Feuer­stein yes­ter­day.

The com­pa­ny’s stock $RMTI has been halt­ed due to the dra­ma.

Rock­well Med­ical’s sit­u­a­tion re­minds us of an­oth­er biotech duk­ing it out with its ex-CEO. Arc­turus Ther­a­peu­tics has been in a very pub­lic bat­tle with its for­mer chief Joe Payne, who’s been work­ing hard to un­do the work of its board. It will be in­ter­est­ing to see if these ex-CEOs can el­bow their way back in­to board rooms in the com­ing months.

Martin Shkreli [via Getty]

Pris­on­er #87850-053 does not get to add drug de­vel­op­er to his list of cred­its

Just days after Retrophin shed its last ties to founder Martin Shkreli, the biotech is reporting that the lead drug he co-invented flopped in a pivotal trial. Fosmetpantotenate flunked both the primary and key secondary endpoints in a placebo-controlled trial for a rare disease called pantothenate kinase-associated neurodegeneration, or PKAN.

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UP­DAT­ED: An em­bold­ened As­traZeneca splurges $95M on a pri­or­i­ty re­view vouch­er. Where do they need the FDA to hus­tle up?

AstraZeneca is in a hurry.

We learned this morning that the pharma giant — not known as a big spender, until recently — forked over $95 million to get its hands on a priority review voucher from Sobi, otherwise known as Swedish Orphan Biovitrum.

That marks another step down on price for a PRV, which allows the holder to slash 4 months off of any FDA review time.

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We­bi­nar: Re­al World End­points — the brave new world com­ing in build­ing fran­chise ther­a­pies

Several biopharma companies have been working on expanding drug labels through the use of real world endpoints, combing through the data to find evidence of a drug’s efficacy for particular indications. But we’ve just begun. Real World Evidence is becoming an important part of every clinical development plan, in the soup-through-nuts approach used in building franchises.

I’ve recruited a panel of 3 top experts in the field — the first in a series of premium webinars — to look at the practical realities governing what can be done today, and where this is headed over the next few years, at the prodding of the FDA.

ZHEN SU — Merck Serono’s Senior Vice President and Global Head of Oncology
ELLIOTT LEVY — Amgen’s Senior Vice President of Global Development
CHRIS BOSHOFF — Pfizer Oncology’s Chief Development Officer

A premium subscription to Endpoints News is required to attend this webinar. Please upgrade to either an Insider or Enterprise plan for access. Already have Endpoints Premium? Please sign-in below. You can contact our Subscriptions team at help@endpointsnews.com with any issues.

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Brian Kaspar. AveXis via Twitter

AveX­is sci­en­tif­ic founder fires back at No­var­tis CEO Vas Narasimhan, 'cat­e­gor­i­cal­ly de­nies any wrong­do­ing'

Brian Kaspar’s head was among the first to roll at Novartis after company execs became aware of the fact that manipulated data had been included in its application for Zolgensma, now the world’s most expensive therapy.

But in his first public response, the scientific founder at AveXis — acquired by Novartis for $8.7 billion — is firing back. And he says that not only was he not involved in any wrongdoing, he’s ready to defend his name as needed.

I reached out to Brian Kaspar after Novartis put out word that he and his brother Allen had been axed in mid-May, two months after the company became aware of the allegations related to manipulated data. His response came back through his attorneys.

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Bob Smith, Pfizer

Pfiz­er is mak­ing a $500M state­ment to­day: Here’s how you be­come a lead play­er in the boom­ing gene ther­a­py sec­tor

Three years ago, Pfizer anted up $150 million in cash to buy Bamboo Therapeutics in Chapel Hill, NC as it cautiously stuck a toe in the small gene therapy pool of research and development.

Company execs followed up a year later with a $100 million expansion of the manufacturing operations they picked up in that deal for the UNC spinout, which came with $495 million in milestones.

And now they’re really going for it.

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Video: Putting the AI in R&D — with Badhri Srini­vasan, Tony Wood, Rosana Kapeller, Hugo Ceule­mans, Saurabh Sa­ha and Shoibal Dat­ta

During BIO this year, I had a chance to moderate a panel among some of the top tech experts in biopharma on their real-world use of artificial intelligence in R&D. There’s been a lot said about the potential of AI, but I wanted to explore more about what some of the larger players are actually doing with this technology today, and how they see it advancing in the future. It was a fascinating exchange, which you can see here. The transcript has been edited for brevity and clarity. — John Carroll

UP­DAT­ED: As­traZeneca’s Imfinzi/treme com­bo strikes out — again — in lung can­cer. Is it time for last rites?

AstraZeneca bet big on the future of their PD-L1 Imfinzi combined with the experimental CTLA-4 drug tremelimumab. But once again it’s gone down to defeat in a major Phase III study — while adding damage to the theory involving targeting cancer with a high tumor mutational burden.

Early Wednesday the pharma giant announced that their NEPTUNE study had failed, with the combination unable to beat standard chemo at overall survival in high TMB cases of advanced non-small cell lung cancer. We won’t get hard data until later in the year, but the drumbeat of failures will call into question what — if any — future this combination can have left.

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Am­gen, Al­ler­gan biosim­i­lar of Roche's block­buster Rit­ux­an clears an­oth­er US piv­otal study 

Novartis $NVS may have given up, but Amgen $AMGN and Allergan $AGN are plowing ahead with their knockoff of Roche’s blockbuster biologic Rituxan in the United States.

Their copycat, ABP 798, was found to have a clinically equivalent impact as Rituxan — meeting the main goal of the study involving CD20-positive B-cell non-Hodgkin’s lymphoma patients. This is the second trial supporting the profile of the biosimilar. In January, it came through with positive PK results in patients with rheumatoid arthritis.

BeiGene and Mus­tang nail down spe­cial FDA sta­tus for top drugs; Roche bags added cov­er­age for Hem­li­bra

→ BeiGene $BGNE is getting a boost in its drive to field a rival to Imbruvica. The FDA has offered an accelerated review to zanubrutinib, a BTK inhibitor that has posted positive results for mantle cell lymphoma. The PDUFA date lands on February 27, 2020. The drug scored breakthrough status at the beginning of the year.

→ BeiGene isn’t the only biopharma company to gain special regulatory status today. Mustang Bio $MBIO and St. Jude Children’s Research Hospital announced that MB-107, a lentiviral gene therapy for the treatment of X-linked severe combined immunodeficiency, also known as bubble boy disease, has been granted Regenerative Medicine Advanced Therapy status.