So what’s hold­ing back Pfiz­er and Gilead from the re­al­ly big M&A deals we’ve all been wait­ing for?

Ja­mi Ru­bin, Gold­man Sachs

Ja­mi Ru­bin at Gold­man Sachs doesn’t mess around. So when her turn came to ask Pfiz­er CEO Ian Read a ques­tion dur­ing the Q1 call with an­a­lysts, she was her typ­i­cal­ly blunt self.

Ru­bin: You and the se­nior man­age­ment team have for some time now been sig­nal­ing a de­sire to go big­ger, do­ing a larg­er-scale trans­ac­tion, and I’m just cu­ri­ous to know what’s hold­ing you back. It’s now May 2, not that I’m im­pa­tient, but is it cor­po­rate tax re­form? Is it some­thing else? Can you re­mind us what you’re look­ing for ex­act­ly, and what are the trig­ger points for mak­ing you de­cide to pull the trig­ger?

Ian Read, Pfiz­er CEO

Read: From a macro stand­point, Ja­mi, I be­lieve the in­dus­try will con­tin­ue to con­sol­i­date over time. I be­lieve there is sim­ply too much re­dun­dan­cy and frag­men­ta­tion, both glob­al­ly and in the U.S., for the sec­tor to con­tin­u­al­ly ef­fi­cient­ly de­liv­er med­i­cines to so­ci­ety. Pfiz­er has been, and I ex­pect will con­tin­ue to be, ac­tive in­dus­try con­sol­ida­tors. How­ev­er, there is a lack of clar­i­ty on po­ten­tial tax re­form, health­care poli­cies of the U.S., and un­cer­tain­ties in the Eu­ro­pean mar­kets both with the French elec­tion and the U.K. snap elec­tion. And on top of that, cer­tain large com­pa­nies have sig­nif­i­cant, al­most bi­na­ry, risks em­bed­ded with­in their busi­ness and pipelines, which could mean­ing­ful­ly al­ter their val­ues.

So we re­main pru­dent in our eval­u­a­tion process re­gard­less of tar­get size. We will con­tin­ue to eval­u­ate deals. We nev­er say nev­er, but I be­lieve the cur­rent en­vi­ron­ment needs to sta­bi­lize in or­der to be an ad­van­ta­geous mar­ket for big deals.

It prob­a­bly didn’t help that Pfiz­er had to start out its call ex­plain­ing that its last big ac­qui­si­tion, the $14 bil­lion Medi­va­tion buy­out, net­ted a prod­uct — Xtan­di — that is ex­pe­ri­enc­ing de­clin­ing sales. That’s not what Pfiz­er, or its in­vestors, had fig­ured on when Read de­ployed the biggest M&A check­ing ac­count in the in­dus­try.

Then last night it was John Mil­li­gan’s turn to talk about Gilead, which has been ad­vised and scold­ed for not putting its big re­serves to work as its hep C for­tunes con­tin­ue to slide at a dra­mat­ic pace.

That talk about tax re­form? Mil­li­gan isn’t lis­ten­ing.

John Mil­li­gan, Gilead CEO

Mil­li­gan: So first of all, with re­gard to Wash­ing­ton, I think that un­cer­tain­ty in Wash­ing­ton seems to be the norm in my 27 years here. So I think we’ve kind of learned to fil­ter that out and fo­cus on the things that are right for the com­pa­ny. There may be tax re­form. There may be repa­tri­a­tion, but you can’t count on it and you can’t wait for it ei­ther.

So we’ve fo­cused our ef­forts — I’ll turn to what you asked last, which is we re­al­ly fo­cused our ef­forts on broad­en­ing our team, adding some depth both sci­en­tif­i­cal­ly and with busi­ness de­vel­op­ment ex­pe­ri­ence so that we in fact have much, much greater ca­pac­i­ty to as­sess things and are in fact ful­ly en­gaged with our teams as­sess­ing a num­ber of dif­fer­ent op­por­tu­ni­ties, which we think could play out over the com­ing year as we start to make progress in get­ting part­ner­ships and po­ten­tial ac­qui­si­tions to­geth­er. So we’re go­ing to just fo­cus on what’s right for Gilead, try to ig­nore the noise glob­al­ly on terms of tax re­form, and do the best thing for the com­pa­ny and for the share­hold­ers in the long term. And we re­al­ly have a great team right now.

Mil­li­gan went on to pro­vide some in­sights in­to what it’s af­ter.

Mil­li­gan: With re­gard to fu­ture legs of stool, I think it’s pret­ty clear we’re look­ing for an­oth­er av­enue to in­crease our op­por­tu­ni­ty for rev­enue, and al­so for help­ing pa­tients with the con­sid­er­able heft that we have, and it’s clear we’ve been fo­cus­ing on on­col­o­gy, where the ques­tion is there in the area, where we can use our re­sources to ac­cel­er­ate prod­ucts to mar­ket and build a mean­ing­ful fran­chise in on­col­o­gy. And that was the hir­ing of Alessan­dro Ri­va; that was the for­ay we made with our busi­ness de­vel­op­ment peo­ple to broad­en and then to look at oth­er things that can build this.

And so I feel very good that we’ve got a num­ber of dif­fer­ent ways to ac­cel­er­ate growth for the com­pa­ny in­to the fu­ture so that a decade from now we’re a very dif­fer­ent com­pa­ny, hav­ing rein­vent­ed our­selves be­yond an­tivi­rals in­to a re­al­ly mul­ti-ther­a­peu­tic area com­pa­ny.

So there you have it. Two big com­pa­nies with plen­ty of fi­nan­cial fire­pow­er and a de­sire to do some­thing im­pres­sive — when the time is ripe. Pfiz­er’s Read is known as the last big megamerg­er play­er while Gilead ac­tu­al­ly turned its ac­qui­si­tion of Phar­mas­set in­to a block­buster — al­though a block­buster that’s cur­ing pa­tients faster than they can di­ag­nose new cas­es.

Every­thing is on the ta­ble right now, from Bris­tol-My­ers Squibb to the lat­est up­start biotech with new tech. But what­ev­er the rea­son, sev­er­al of the big play­ers are still not re­al­ly in the game. And Roche, Sanofi and oth­ers are clear­ly turned off by high val­u­a­tions. It’s a sell­er’s mar­ket right now, and deals aren’t as eas­i­ly come by as every­one ex­pect­ed so far this year.

Aduhelm OK 'bit­ter­sweet' for ALS ad­vo­cates; Con­trast­ing Covid-19 vac­cine read­outs; GSK joins TIG­IT bat­tle; and more

Welcome back to Endpoints Weekly, your review of the week’s top biopharma headlines. Want this in your inbox every Saturday morning? Current Endpoints readers can visit their reader profile to add Endpoints Weekly. New to Endpoints? Sign up here.

With the busiest days of June now behind us, we’re starting to think seriously about the second half of the year. In August, we have scheduled a special report where Endpoints will compile a list of the 20 most influential R&D executives in biopharma. Know a luminary who should definitely be included? Nominate them now.

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In­side Track: Be­hind the Scenes of a Ma­jor Biotech SPAC

Dr. David Hung and Michelle Doig are no strangers to the SPAC phenomenon. As Founder and CEO of Nuvation Bio, a biotech company tackling some of the greatest unmet needs in oncology, Dr. Hung recently took the company public in one of this year’s biggest SPAC related deals. And as Partner at Omega Funds, Doig not only led and syndicated Nuvation Bio’s Series A, but is now also President of the newly formed, Omega-sponsored, Omega Alpha SPAC (Nasdaq: OMEG; oversubscribed $138m IPO priced January 6, 2021).

Bris­tol My­ers breaks the bank on Ei­sai's fo­late re­cep­tor ADC drug, lay­ing out more than $3B+ for rights

For years, innovation in oncology has been a crapshoot with Big Pharma — the whales at the table — dropping the big bucks for the key to the next generation of tumor fighters. Bristol Myers Squibb hasn’t exactly made a name for being an innovator in the space, but that doesn’t mean it won’t splash in when it sees a potential winner.

Now, with a massive check in hand, the drugmaker is willing to put its intuition to the test.

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Michael Chambers (L) and John Ballantyne

Dana­her strikes deal to buy boom­ing next-gen man­u­fac­tur­er Alde­vron for $9.6B

Life sciences conglomerate Danaher Corp. $DHR has struck a deal to buy the fast-growing Aldevron, one of the world’s top manufacturers of hotly sought-after plasmid DNA, mRNA and recombinant proteins for the burgeoning world of vaccine and drugmakers pushing some game-changing technologies.

Buyout talks set the stage for Danaher to settle on a $9.6 billion cash pact to acquire the private Fargo, ND-based company — a key supplier for a disruptive new Covid vaccine as well as a host of gene and cell therapy and CRISPR gene editing players — founded by Michael Chambers and CSO John Ballantyne as a crew of 2 back in 1998.

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Who are the lu­mi­nar­ies dri­ving the biggest ad­vances in bio­phar­ma R&D? End­points News is ask­ing for your nom­i­na­tions for a spe­cial re­port

In biopharma, driving a drug to market is the ultimate goal — but none of that happens without a strong research and development program. At the most successful companies, those R&D efforts are spearheaded by true innovators in the field who are always looking for that next novel mechanism of action or breakthrough safety profile.

Now, Endpoints News is asking you to tell us who those guiding lights are.

Enrique Conterno, FibroGen

As it awaits piv­otal re­view of lead drug, Fi­bro­Gen bol­sters its ear­ly pipeline with li­cens­ing deal for galectin pro­gram

FibroGen’s long-awaited review for anemia med roxadustat is just weeks away, and there’s good reason to believe the outcome won’t swing in its favor after a data manipulation scandal and tepid analyst consensus on the drug’s chances. With its future murky, FibroGen is now opening the pocketbook to refresh its pipeline for whatever the next phase may be.

FibroGen will shell out $25 million in cash for a global license to Boston-area biotech HiFiBiO’s galectin-9 platform targeting immuno-oncology and autoimmune disorders, the partners said Thursday.

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Samantha Du, Zai Lab

Chi­nese on­col­o­gy spe­cial­ist Zai Lab bro­kers a deal with Macro­Gen­ics for up to 4 bis­pecifics with a mod­est down pay­ment

Samantha Du’s Zai Lab has earned its reputation as a Chinese oncology partner of choice with an aggressive licensing strategy to tap that growing market. Now, a West Coast bispecifics player with a lead collaboration molecule already identified will add its name to Zai Lab’s growing rolodex.

Zai Lab will shell out $55 million upfront — $25 million in cash and $30 million in equity — for a mix of Asian and global rights to four of San Francisco-based MacroGenics’ bispecific antibodies, with one lead molecule already in development, the partners said Wednesday.

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FDA's con­tro­ver­sial Aduhelm de­ci­sion leaves ALS pa­tients feel­ing spurned

The FDA’s controversial approval of Biogen’s Aduhelm drug for Alzheimer’s disease has been met with fierce resistance from all corners of the biopharma industry, but few seem to be as upset with the decision as ALS patients and advocacy groups.

For all that’s already been written and discussed about the agency’s announcement, from the drug’s exorbitantly high price of $56,000 per year to criticism over lowered standards, ALS patients see something more. ALS patients and associations say they largely regarded Aduhelm’s approval as a bittersweet double standard: happy that those with Alzheimer’s have a new drug available, but questioning how the FDA evaluated Biogen’s drug compared to the experimental programs being studied for their own disease.

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Spring reg­u­la­to­ry agen­da: What’s com­ing soon-ish from the FDA

The FDA’s lack of a permanent commissioner does not seem to be halting its progress to propose and finalize dozens of new regulations, with the latest batch covering everything from adverse event reporting to supplemental application submissions to annual reports for INDs.

Overall, FDA expects to release more than 40 new proposed regulations and finalize another 24 in the coming months and years.

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