Sen­a­tors grill Alex Azar on drug prices; Mor­phoSys sells rights to Darza­lex ri­val in $120M deal; Se­r­i­al deal­mak­er X-Chem en­ters new dis­cov­ery pact with Gilead

→ Alex Azar faced a group of skep­ti­cal sen­a­tors on Wednes­day, De­moc­rats and Re­pub­li­cans, as they re­viewed his nom­i­na­tion as chief of HHS un­der Pres­i­dent Don­ald Trump. And for the bulk of the first half of the dis­cus­sion, the sub­ject was drug prices; as in, the price of drugs is too damn high. Azar, who wrapped a lengthy stint as a se­nior ex­ec at Eli Lil­ly about a year ago, was not known for dri­ving down drug prices. But he re­peat­ed­ly agreed that drug prices need to come down now. In one of the sharpest at­tacks, Re­pub­li­can Rand Paul told Azar he has a lot of work to do to con­vince the Amer­i­can peo­ple that he’s work­ing on their be­half, rather than Big Phar­ma. And he vowed to with­hold his sup­port un­less Azar could come up with an ef­fec­tive reim­por­ta­tion plan. De­spite the back-and-forth, Azar will like­ly win con­fir­ma­tion and isn’t ex­pect­ed to do much be­yond en­cour­ag­ing more gener­ic drug ap­provals as a strat­e­gy to rein in drug prices.

Ger­man biotech Mor­phoSys has sold rights to its mul­ti­ple myelo­ma can­di­date MOR202 to Shang­hai’s I-Mab, nab­bing a $20 mil­lion up­front pay­ment with an ex­tra $100 mil­lion avail­able in po­ten­tial mile­stones. The re­gion­al li­cens­ing deal al­lows I-Mab’s af­fil­i­ate I-Mab Bio­phar­ma to de­vel­op and com­mer­cial­ize the C38 an­ti­body in Chi­na, Tai­wan, Hong Kong and Macao. MOR202 is a pur­port­ed ri­val to Janssen/Gen­mab’s Darza­lex (dara­tu­mum­ab), with Mor­phoSys’ drug can­di­date show­ing short­er in­fu­sion times in a Phase I/II study. Mor­phoSys is bring­ing on part­ners to sup­port clin­i­cal de­vel­op­ment. As a re­sult of this new deal, the com­pa­ny has upped its rev­enue pro­jec­tion by €15 mil­lion, push­ing it in­to the €63 mil­lion to €65 mil­lion range for 2017.

→ X-Chem has inked yet an­oth­er dis­cov­ery deal, this time with Gilead. In the agree­ment, which comes with an un­spec­i­fied up­front pay­ment, X-Chem will put its li­brary of “120 bil­lion DNA-en­cod­ed small mol­e­cules” to work in search of an­ti-vi­ral drugs and oth­er un­named ther­a­peu­tic tar­gets. Gilead has the op­tion to li­cense drug leads found un­der the col­lab­o­ra­tion, and will do fur­ther de­vel­op­ment and com­mer­cial­iza­tion of those pro­grams. The Waltham, MA com­pa­ny has inked a long line­up of re­search pacts with big play­ers in the in­dus­try, in­clud­ing Roche, As­traZeneca, Bay­er, Pfiz­er, Alex­ion, MD An­der­son Can­cer Cen­ter, Sanofi and J&J. Most re­cent­ly, the com­pa­ny’s an­nounced deals with Ono, Astel­las and Janssen. On this new pact with Gilead, X-Chem al­so has a shot at li­cens­ing fees and mile­stone pay­ments on leads that come out the agree­ment.

Shao-Lee Lin

→ Biotech vet­er­an Shao-Lee Lin will start at Hori­zon Phar­ma ear­ly next year as ex­ec­u­tive vice pres­i­dent, re­search and de­vel­op­ment and chief sci­en­tif­ic of­fi­cer. In this new po­si­tion, Lin joins CMO Jef­frey Sher­man in man­ag­ing the com­pa­ny’s grow­ing pipeline. As Hori­zon $HZNP gains a larg­er pres­ence in the or­phan drug field while and builds on its port­fo­lio of mar­ket­ed drugs, it could like use Lin’s ex­pe­ri­ence at Ab­b­Vie, Gilead and Am­gen lead­ing drug de­vel­op­ment across im­munol­o­gy, vi­rol­o­gy, in­flam­ma­tion and res­pi­ra­to­ry ther­a­peu­tics. Said Lin in a state­ment: “I’m im­pressed by Hori­zon’s rapid growth and its strat­e­gy for evo­lu­tion from pri­ma­ry care, with a fo­cus on mar­ket­ed med­i­cines, to di­ver­si­fy­ing in­to rare dis­eases and rheuma­tol­ogy and now com­mit­ted to the next stage in its trans­for­ma­tion of build­ing a ro­bust and sus­tain­able re­search and de­vel­op­ment port­fo­lio.”

Brent Saunders [Getty Photos]

UP­DAT­ED: Ab­b­Vie seals $63B deal to buy a trou­bled Al­ler­gan — spelling out $1B in R&D cuts

Brent Saunders has found his way out of the current fix he’s in at Allergan $AGN. He’s selling the company to AbbVie for $63 billion in the latest example of the hot M&A market in biopharma.

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Af­ter rais­ing $158M, this up­start's founders have star back­ers and plans to break new ground in gene ther­a­py

Back in 2014, Stephanie Tagliatela opted to take an early exit out of her PhD program after working in Mark Bear’s lab at MIT, where she specialized in the synaptic connections between neuronal cells in the brain. She never finished that PhD, but she and fellow MIT student Kartik Ramamoorthi — who was on the founding team at Voyager — came away with some ideas for a gene therapy startup.

Today, fully 5 years later, she and Ramamoorthi are taking the wraps off of a $104 million mega-round designed to take the cumulative work of their preclinical formative stage for Encoded Therapeutics into human studies. They’ve now raised $158 million since starting out in Illumina’s incubator in the Bay Area, and they believe they are firmly on track to do something unique in gene therapy.

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Novotech CEO Dr. John Moller

Novotech CRO Award­ed Frost & Sul­li­van Best Biotech CRO Asia-Pa­cif­ic 2019

Known in the in­dus­try as the Asia-Pa­cif­ic CRO, Novotech is now lead CRO ser­vices provider for the grow­ing num­ber of in­ter­na­tion­al biotechs se­lect­ing the re­gion for their stud­ies.

Re­flect­ing this Asia-Pa­cif­ic growth, Novotech staff num­bers are up 20% since De­cem­ber 2018 to 600 in-house clin­i­cal re­search peo­ple across a full range of ser­vices, across the re­gion.

Novotech’s ca­pa­bil­i­ties have been rec­og­nized by an­a­lysts like Frost & Sul­li­van, most re­cent­ly with the pres­ti­gious Asia-Pa­cif­ic CRO Biotech of the year award for best prac­tices in clin­i­cal re­search for biotechs for the fifth year. See oth­er awards here.

Sanofi/Re­gen­eron mus­cle ahead of a ri­val No­var­tis/Roche team, win first ap­proval in key rhi­nos­i­nusi­tis field

Re­gen­eron and their part­ners at Sanofi have beat the No­var­tis/Roche team to the punch on an­oth­er key in­di­ca­tion for their block­buster an­ti-in­flam­ma­to­ry drug Dupix­ent. The drug team scored an ac­cel­er­at­ed FDA ap­proval for chron­ic rhi­nos­i­nusi­tis with nasal polyps, mak­ing this the first such NDA for the field.

An­a­lysts have been watch­ing this race for awhile now, as Sanofi/Re­gen­eron won a snap pri­or­i­ty re­view for what is now their third dis­ease in­di­ca­tion for this treat­ment. And they’re not near­ly done, build­ing up hopes for a ma­jor fran­chise.

SQZ, Ery­tech kick off $57M cell ther­a­py part­ner­ship; Jean-Paul Kress lands new CEO gig at Mor­phoSys

→ In a mar­riage of two tech­nolo­gies meant to make cell ther­a­pies more pow­er­ful, SQZ Biotech is team­ing up with France’s Ery­tech Phar­ma for a col­lab­o­ra­tion, with $57 mil­lion re­served for the first project and $50 mil­lion for each sub­se­quent ap­proval (prod­uct or in­di­ca­tion). Hav­ing ac­cess to Ery­tech’s method of fash­ion­ing ther­a­peu­tics from red blood cells, the Cam­bridge, MA-based com­pa­ny said, will am­pli­fy SQZ’s cell en­gi­neer­ing ca­pa­bil­i­ties and al­low them to de­vleop a new class of im­munomod­u­la­to­ry ther­a­pies. Its own tech — so far ap­plied in can­cer but al­so has po­ten­tial in di­a­betes — tem­po­rary dis­rupts the cell mem­brane by squeez­ing the cell, thus cre­at­ing a brief win­dow for tar­get ma­te­ri­als such as anti­gens to en­ter.

Richard Gonzalez testifying in front of Senate Finance Committee, February 2019 [AP Images]

Ab­b­Vie's $63B buy­out spot­lights the re­turn of ma­jor M&A deals — de­spite the back­lash

Big time M&A is back. But for how long?

Over the past 18 months we’ve now seen three major buyouts announced: Takeda/Shire; Bristol-Myers/Celgene and now AbbVie/Allergan. And with this latest deal it’s increasingly clear that the sharp fall from grace suffered by high-profile players which have seen their share prices blasted has created an opening for the growth players in big pharma to up their game — in sharp contrast to the popular bolt-on deals that have been driving the growth strategy at Novartis, Merck, Roche and others.

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Two biotech uni­corns swell pro­posed IPOs, eye­ing a $600M-plus wind­fall

We’ve been wait­ing for the ar­rival of Bridge­Bio’s IPO to top off the wave of new biotech of­fer­ings sweep­ing through Nas­daq at the end of H1. And now we learn that it’s been sub­stan­tial­ly up­sized.

Ini­tial­ly pen­ciled in at a uni­corn-sized $225 mil­lion, the KKR-backed biotech has spiked that to the neigh­bor­hood of $300 mil­lion, look­ing to sell 20 mil­lion shares at $14 to $16 each. That’s an added 5 mil­lion shares, re­ports Re­nais­sance Cap­i­tal, which fig­ures the pro­posed mar­ket val­u­a­tion for Neil Ku­mar’s com­pa­ny at $1.8 bil­lion.

No­var­tis holds back the copy­cat brigade's at­tack on its top drug fran­chise — for now

A fed­er­al judge has put a gener­ic chal­lenge to No­var­tis’ block­buster mul­ti­ple scle­ro­sis drug Gilenya on hold while a patent fight plays out in court.

Judge Leonard P. Stark is­sued a tem­po­rary in­junc­tion ear­li­er this week, forc­ing My­lan, Dr. Red­dy’s Lab­o­ra­to­ries and Au­robindo Phar­ma to shelve their launch plans to al­low the patent fight to pro­ceed. He ruled that al­low­ing the gener­ics in­to the mar­ket now would per­ma­nent­ly slash the price for No­var­tis, even if it pre­vails. 

Top an­a­lyst finds a sil­ver lin­ing in Ab­b­Vie’s $63B Al­ler­gan buy­out — but there’s a catch

Af­ter get­ting beat up on all sides from mar­ket ob­servers who don’t much care for the lat­est mega-deal to ar­rive in bio­phar­ma, at least one promi­nent an­a­lyst now is start­ing to like what he sees in the num­bers for Ab­b­Vie/Al­ler­gan.

But it’s go­ing to take some en­cour­age­ment if Ab­b­Vie ex­ecs want it to last.

Ab­b­Vie’s mar­ket cap de­clined $20 bil­lion on Tues­day as the stock took a 17% hit dur­ing the day. And SVB Leerink’s Ge­of­frey Porges can see a dis­tinct out­line of an up­side af­ter re­view­ing the fun­da­men­tals of the deal.

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