Say what? Al­ler­gan just agreed to pay a 6X cash pre­mi­um for To­bi­ra and its trou­bled PhI­II NASH drug

A cou­ple of months af­ter a tri­al set­back crushed To­bi­ra’s share price, Al­ler­gan $AGN has swooped in to buy the com­pa­ny for $29.35 a share and up to $49.84 a share in con­tin­gent val­ue rights if its late-stage NASH drug turns out to be a hit.

Brent Saun­ders, Al­ler­gan

That cash price is more than six times what To­bi­ra’s bat­tered stock $TBRA closed at yes­ter­day, a vir­tu­al­ly un­heard of pre­mi­um in a mar­ket that is al­ready ap­ply­ing high val­ues to biotech as­sets. The to­tal val­ue for the com­pa­ny will range up to $1.7 bil­lion. The com­pa­ny stock trad­ed for $4.74 at the close yes­ter­day, with a mar­ket cap of $89 mil­lion.

The buy­out stun­ner comes cour­tesy of Al­ler­gan CEO Brent Saun­ders, who has been on a deal spree that in­cludes the Vi­tae ac­qui­si­tion a few days ago. These kind of bolt-on ac­qui­si­tions are a tempt­ing tar­get for Al­ler­gan’s CEO, es­pe­cial­ly since its merg­er with Pfiz­er fell through. Al­ler­gan re­cent­ly closed on a pact to sell a gener­ics unit to Te­va, leav­ing it with a hefty sum in cash re­serves for deals like this.

An­a­lysts had to do a dou­ble take on the num­bers in­volved.

“In our rec­ol­lec­tion, the up­front alone places the high­est pre­mi­um we’ve ever seen on a deal, and not just in biotech,” not­ed Baird’s Bri­an Sko­r­ney. “Not to men­tion, the val­u­a­tion placed on some of the mile­stones is, in our opin­ion, ex­ces­sive. To­bi­ra has in­di­cat­ed plans to ini­ti­ate a Phase III tri­al next year, on which Al­ler­gan has agreed to pay $13.68 per CVR for en­roll­ment of the first pa­tient.”

The deal al­so marks a big bet on NASH, or fat­ty liv­er dis­ease, which has been grow­ing at an epi­dem­ic pace around the world. Al­ler­gan is adding ceni­crivi­roc and evogliptin to its pipeline, and the com­pa­ny says it will look for ad­di­tions to beef up its new NASH ef­fort.

David Nichol­son, Al­ler­gan

Ceni­crivi­roc flunked a Phase IIb study for NASH in Ju­ly, but the South San Fran­cis­co-based biotech said it got enough pos­i­tive da­ta on a sec­ondary end­point to war­rant a move in­to a piv­otal Phase III pro­gram. To­bi­ra’s shares were crushed by the news, plung­ing 64%.

The pri­ma­ry end­point in the study, which reg­is­tered 289 pa­tients, was a drop in a score for dis­ease ac­tiv­i­ty in NASH. On that point, the drug flopped. It al­so failed a sec­ondary end­point for com­plete res­o­lu­tion of steato­hep­ati­tis.

But To­bi­ra vowed that it had a good rea­son to launch a late-stage pro­gram, look­ing for an im­prove­ment in fi­bro­sis with­out any wors­en­ing of steato­hep­ati­tis. The da­ta for the in­tent-to-treat pop­u­la­tion in Phase IIb was 20% for the drug vs. 10% for place­bo af­ter a year of treat­ment, p=0.02; in oth­er words, twice as many pa­tients on drug had a marked im­prove­ment for fi­bro­sis, but it was a small group.

Still, it was big enough to en­cour­age Al­ler­gan to leap in.

Said Al­ler­gan R&D chief David Nichol­son:

“Im­por­tant­ly, NASH treat­ment may well re­quire a mul­ti-ther­a­peu­tic ap­proach to ad­dress the mul­ti­ple fac­tors of the dis­ease. CVC has been shown in clin­i­cal tri­als to pro­vide sig­nif­i­cant im­prove­ment in liv­er fi­bro­sis, the hall­mark of NASH. Liv­er fi­bro­sis is as­so­ci­at­ed with key long-term out­comes, in­clud­ing over­all mor­tal­i­ty, liv­er trans­plan­ta­tion and liv­er-re­lat­ed events.  Evogliptin, in pre­clin­i­cal mod­els, has been shown to de­crease he­pat­ic glu­cose pro­duc­tion, im­prove he­pat­ic triglyc­eride con­tent and steato­sis, and re­duce his­to­log­ic mark­ers of in­flam­ma­tion of the liv­er. To­geth­er, these pro­grams pro­vide a high­ly com­ple­men­tary po­ten­tial ther­a­peu­tic ap­proach to ad­dress the in­flam­ma­to­ry, meta­bol­ic and fi­brot­ic el­e­ments of NASH that the med­ical com­mu­ni­ty will need to treat this con­di­tion.”

Biogen CEO Michel Vounatsos (via Getty Images)

With ad­u­canum­ab caught on a cliff, Bio­gen’s Michel Vounatsos bets bil­lions on an­oth­er high-risk neu­ro play

With its FDA pitch on the Alzheimer’s drug aducanumab hanging perilously close to disaster, Biogen is rolling the dice on a $3.1 billion deal that brings in commercial rights to one of the other spotlight neuro drugs in late-stage development — after it already failed its first Phase III.

The big biotech has turned to Sage Therapeutics for its latest deal, close to a year after the crushing failure of Sage-217, now dubbed zuranolone, in the MOUNTAIN study.

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Pascal Soriot (AP Images)

As­traZeneca, Ox­ford on the de­fen­sive as skep­tics dis­miss 70% av­er­age ef­fi­ca­cy for Covid-19 vac­cine

On the third straight Monday that the world wakes up to positive vaccine news, AstraZeneca and Oxford are declaring a new Phase III milestone in the fight against the pandemic. Not everyone is convinced they will play a big part, though.

With an average efficacy of 70%, the headline number struck analysts as less impressive than the 95% and 94.5% protection that Pfizer/BioNTech and Moderna have boasted in the past two weeks, respectively. But the British partners say they have several other bright spots going for their candidate. One of the two dosing regimens tested in Phase III showed a better profile, bringing efficacy up to 90%; the adenovirus vector-based vaccine requires minimal refrigeration, which may mean easier distribution; and AstraZeneca has pledged to sell it at a fraction of the price that the other two vaccine developers are charging.

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John Maraganore, Alnylam CEO (Scott Eisen/Bloomberg via Getty Images)

Al­ny­lam gets the green light from the FDA for drug #3 — and CEO John Maraganore is ready to roll

Score another early win at the FDA for Alnylam.

The FDA put out word today that the agency has approved its third drug, lumasiran, for primary hyperoxaluria type 1, better known as PH1. The news comes just 4 days after the European Commission took the lead in offering a green light.

An ultra rare genetic condition, Alnylam CEO John Maraganore says there are only some 1,000 to 1,700 patients in the US and Europe at any particular point. The patients, mostly kids, suffer from an overproduction of oxalate in the liver that spurs the development of kidney stones, right through to end stage kidney disease.

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Jason Kelly, Ginkgo Bioworks CEO (Kyle Grillot/Bloomberg via Getty Images)

Af­ter Ko­dak de­ba­cle, US lends $1.1B to a syn­thet­ic bi­ol­o­gy com­pa­ny and their big Covid-19, mR­NA plans

In mid-August, as Kodak’s $765 million government-backed push into drug manufacturing slowly fell apart in national headlines, Ginkgo Bioworks CEO Jason Kelly got a message from his company’s government liaison: HHS wanted to know if they, too, might want a loan.

The government’s decision to lend Kodak three quarters of a billion dollars raised eyebrows because Kodak had never made drugs before. But Ginkgo, while not a manufacturing company, had spent the last decade refining new ways to produce materials inside cells and building automated facilities across Boston.

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Bax­ter con­tin­ues on-shoring push with $50M In­di­ana ex­pan­sion

It’s been a banner year for the once humdrum business of manufacturing drugs, particularly vaccines. Billions have been spent ramping up facilities for Covid-19 jabs, while individual CDMOs have expanded their facilities, apparently anticipating demand or responding to a government-led push to onshore drug manufacturing.

Now Baxter Biopharma Solutions, the CDMO wing of the many-armed healthcare giant Baxter, is getting in on the game. On Tuesday, they announced plans to spend $50 million to expand their flagship, 600,000 square-foot facility in Bloomington, IN.

Eu­ro­pean Union aims to es­tab­lish patent workaround in case of emer­gen­cies while try­ing to strength­en its own IP

The European Union is looking at ways to bypass patent protections and make it easier to make generic drugs in cases of emergency such as the Covid-19 pandemic, a new document says.

Normally, under WTO regulations, the practice known as “compulsory licensing” is allowed in exceptional circumstances and could be applied as a waiver to bypass patent holders. Wednesday’s document was published as part of the EU’s plan to shore up the intellectual property rights of its member states.

Pur­due Phar­ma pleads guilty in fed­er­al Oxy­Con­tin probe, for­mal­ly rec­og­niz­ing it played a part in the opi­oid cri­sis

Purdue Pharma, the producer of the prescription painkiller OxyContin, admitted Tuesday that, yes, it did contribute to America’s opioid epidemic.

The drugmaker formally pleaded guilty to three criminal charges, the AP reported, including getting in the way of the DEA’s efforts to combat the crisis, failing to prevent the painkillers from ending up on the black market and encouraging doctors to write more painkiller prescriptions through two methods: paying them in a speakers program and directing a medical records company to send them certain patient information. Purdue’s plea deal calls for $8.3 billion in criminal fines and penalties, but the company is only liable for a fraction of that total — $225 million.

PhRMA sues Trump gov­ern­ment over drug im­por­ta­tion rule — days be­fore it's set to be ef­fec­tive

Ever since President Donald Trump floated the idea of using state-sponsored importation to lower drug prices, PhRMA has made its opposition abundant. Not only is the proposal dangerous and futile,  but the trade group has also argued that it may even be illegal.

Now that the FDA has issued its final rule permitting states to bring certain drugs from Canada, PhRMA is taking the government to court — just a few days before the rule is slated to take effect.

The ad­u­canum­ab co­nun­drum: The PhI­II failed a clear reg­u­la­to­ry stan­dard, but no one is cer­tain what that means any­more at the FDA

Eighteen days ago, virtually all of the outside experts on an FDA adcomm got together to mug the agency’s Billy Dunn and the Biogen team when they presented their upbeat assessment on aducanumab. But here we are, more than 2 weeks later, and the ongoing debate over that Alzheimer’s drug’s fate continues unabated.

Instead of simply ruling out any chance of an approval, the logical conclusion based on what we heard during that session, a series of questionable approvals that preceded the controversy over the agency’s recent EUA decisions has come back to haunt the FDA, where the power of precedent is leaving an opening some experts believe can still be exploited by the big biotech.

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