Strug­gling poo-test­ing start­up uBio­me files for bank­rupt­cy, months af­ter FBI kicks off in­ves­ti­ga­tion

George Church Har­vard

Months af­ter the FBI launched a probe in­to its billing prac­tices, be­lea­guered poo-test­ing start­up uBio­me has filed for bank­rupt­cy.

Jes­si­ca Rich­man and Zach Apte launched uBio­me in 2012, af­ter rais­ing $350,000 from a crowd­fund­ing cam­paign to fa­cil­i­tate a mi­cro­bio­me study. The com­pa­ny — which maps the ecosys­tem of mi­crobes in the body to de­vel­op tests eval­u­at­ing gut and vagi­nal health — has since hauled in more than $100 mil­lion in ven­ture cap­i­tal from Y Com­bi­na­tor, An­dreessen Horowitz, and 8VC.

In the be­gin­ning, San Fran­cis­co-based uBio­me made all the right moves.  It wooed a num­ber of lead­ing sci­en­tists from UCSF and Har­vard, in­clud­ing ge­neti­cist George Church, on its sci­en­tif­ic ad­vi­so­ry board, re­cruit­ed for­mer con­tro­ver­sial No­var­tis CEO Joe Jimenez to its board, re­leased a hand­ful of di­rect-to-con­sumer tests de­signed to gauge mi­cro­bial health, and inked a part­ner­ship with L’Oréal to re­search the skin mi­cro­bio­me.

But soon, things start­ed to fall apart. In April, the FBI com­menced an in­ves­ti­ga­tion in­to the com­pa­ny’s billing prac­tices — even­tu­al­ly raid­ing uBio­me’s of­fices — around the time sources told CN­BC that the start­up was hound­ing doc­tors to ap­prove tests with lit­tle over­sight, billing con­sumers mul­ti­ple times with­out their con­sent —and in­sur­ance plans were start­ing to re­ject the claims.

The com­pa­ny got rid of half its staff ear­li­er this sum­mer. In ad­di­tion, in­sid­ers told Busi­ness In­sid­er that the sci­ence back­ing up its tests was flawed from the start — trig­ger­ing an in­ter­nal in­ves­ti­ga­tion. A jour­nal where uBio­me pub­lished its ba­sic re­search is al­so in­ves­ti­gat­ing the com­pa­nies claims, BI re­port­ed. The sale of some of the com­pa­ny’s tests was al­so re­cent­ly sus­pend­ed.

Short­ly af­ter the FBI in­ves­ti­ga­tion be­came pub­lic, uBio­me’s founders de­part­ed to make room for a new man­age­ment team.

In a fil­ing, uBio­me blamed its founders for much of its trou­ble. “The Founders im­ple­ment­ed cer­tain busi­ness strate­gies…that were high­ly prob­lem­at­ic, con­tained sig­nif­i­cant op­er­a­tional (but not sci­en­tif­ic) flaws and, in some in­stances, were of ques­tion­able le­gal­i­ty,” the fil­ing said.

“These is­sues in­clud­ed im­prop­er in­sur­ance provider billing prac­tices, im­prop­er use of a telemed­i­cine physi­cian net­work (known as the Ex­ter­nal Clin­i­cal Care Net­work), over­ly ag­gres­sive and po­ten­tial­ly mis­lead­ing mar­ket­ing tac­tics, ma­nip­u­la­tion of cus­tomer up­grade test­ing, and im­prop­er use of cus­tomer in­duce­ments. More­over, cer­tain in­for­ma­tion pre­sent­ed to po­ten­tial in­vestors dur­ing the three rounds of cap­i­tal raise my have been in­cor­rect and/or mis­lead­ing.”

“(W)hile the Debtor ex­pe­ri­enced a se­ri­ous set­back as a re­sult of the (FBI) In­ves­ti­ga­tion, the In­ves­ti­ga­tion re­sult­ed from the busi­ness prac­tices im­ple­ment­ed by the Founders, not bad sci­ence or bad lab prac­tices. The Debtor has es­tab­lished a new Board and a new Busi­ness Plan, and is poised to move for­ward. This Chap­ter 11 Case will pro­vide the fresh start nec­es­sary to do so.”

Af­ter fil­ing for bank­rupt­cy, uBio­me has se­cured $8 mil­lion in fi­nanc­ing from Sil­i­con Val­ley Bank. The start­up is seek­ing to con­sum­mate a sale of its busi­ness with­in the first 75 days, and in a sep­a­rate fil­ing un­veiled it cur­rent­ly has as­sets worth $50 to $100 mil­lion, an es­ti­mat­ed li­a­bil­i­ties in the range of $10 to $50 mil­lion.

A new era of treat­ment: How bio­mark­ers are chang­ing the way we think about can­cer

AJ Patel was recovering from a complicated brain surgery when his oncologist burst into the hospital room yelling, “I’ve got some really great news for you!”

For two years, Patel had been going from doctor to doctor trying to diagnose his wheezing, only to be dealt the devastating news that he had stage IV lung cancer and only six months to live. And then they found the brain tumors.

“What are you talking about?” Patel asked. He had never seen an oncologist so happy.

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FDA spells out the rules and re­stric­tions for states seek­ing to im­port drugs from Cana­da

The FDA is offering more of an explanation of the guardrails around its program that may soon allow states to import prescription drugs in some select circumstances from Canada, but only if such imports will result in significant cost reductions for consumers.

While the agency has yet to sign off on any of the 5 state plans in the works so far, and PhRMA’s suit to block the Trump-era rule allowing such imports is stalled, the new Q&A guidance spells out the various restrictions that states will have to abide by, potentially signaling that a state approval is coming.

David Ricks, Eli Lilly CEO (David Paul Morris/Bloomberg via Getty Images)

Eli Lil­ly set to in­vest $2.1B in home state man­u­fac­tur­ing boost

Eli Lilly is looking to expand its footprint in its home Hoosier State by making a major investment in manufacturing.

The pharma is investing $2.1 billion in two new manufacturing sites at Indiana’s LEAP Lebanon Innovation and Research District in Boone County, northwest of Lilly’s headquarters in Indianapolis.

The two new facilities will expand Lilly’s manufacturing network for active ingredients and new therapeutic modalities, including genetic medicines, according to a press release.

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US sees spike in Paxlovid us­age as Mer­ck­'s mol­nupi­ravir and As­traZeneca's Evusheld are slow­er off the shelf

New data from HHS show that more than 162,000 courses of Pfizer’s Covid-19 antiviral Paxlovid were administered across the US over the past week, continuing a streak of increased usage of the pill, and signaling not only rising case numbers but more awareness of how to access it.

In comparison to this week, about 670,000 courses of the Pfizer pill have been administered across the first five months since Paxlovid has been on the US market, averaging about 33,000 courses administered per week in that time.

Pfiz­er and CD­MOs ramp up Paxlovid man­u­fac­tur­ing with Kala­ma­zoo plant ex­pan­sion lead­ing the way

As the Covid-19 pandemic continues to evolve, pharma companies and manufacturers are exploring how to step up production on antivirals.

Pfizer is planning to expand its Kalamazoo-area facility to increase manufacturing capabilities for the oral Covid-19 antiviral Paxlovid, according to a report from Michigan-based news site MLive. The expansion of the facility, which serves as Pfizer’s largest manufacturing location, is expected to create hundreds of “high-skilled” STEM jobs, MLive reported. No details about the project’s cost and timeline have been released, but according to MLive, Pfizer will announce the details of the expansion at some point in early June.

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Peter Thompson, Terremoto Biosciences interim CEO

For­mer Prin­cip­ia team looks to shake up co­va­lent small mol­e­cules again, this time at 'earthquake' scale

Terremoto Biosciences goes back a long ways, in a sense, to about a dozen years ago when Principia Biopharma was founded by UCSF professor Jack Taunton. Peter Thompson initially helmed the biotech.

The company helped expand covalent small molecule inhibitors beyond oncology and into autoimmune disease by targeting cystine. But that amino acid is uncommon in a lot of proteins, offering fewer drug targets than, say, lysine, which is present in most proteins of interest. So, over the years, Taunton went back to the drawing board to check out that second amino acid.

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Mihael Polymeropoulos, Vanda Pharmaceuticals CEO

Phar­ma com­pa­ny con­tin­ues its FDA law­suit spree, this time af­ter agency de­nies fast-track des­ig­na­tion

Vanda Pharmaceuticals is making a name for itself, at least in terms of suing the FDA.

The DC-headquartered firm on Monday filed its latest suit against the agency, with the company raising concerns over the FDA’s failure to grant a fast track designation for Vanda’s potential chronic digestive disorder drug tradipitant, which is a neurokinin 1 receptor antagonist.

Specifically, Vanda said FDA’s “essential point” in its one-page denial letter on the designation pointed to “the lack of necessary safety data,” which was “inconsistent with the criteria for … Fast Track designation.”

Robert Califf (Michael Brochstein/Sipa USA via AP Images)

House Re­pub­li­cans at­tack Chi­na-on­ly da­ta in FDA sub­mis­sions, seek new in­ves­ti­ga­tion in­to re­search in­spec­tions

Three Republican representatives are calling on the FDA to take a closer look at the applications including only clinical data from China.

The letter to FDA commissioner Rob Califf late last week comes as the agency recently rejected Eli Lilly’s anti-PD-1 antibody, which attempted to bring China-only data but ran into a bruising adcomm that may crush the hopes of any other companies looking to bring cheaper follow-ons based only on Chinese data.

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Pfizer CEO Albert Bourla at the World Economic Forum (Gian Ehrenzeller/Keystone via AP Images)

All about ac­cess: Pfiz­er moves to a non-prof­it mod­el for drug sales in 45 low­er-in­come coun­tries

Leading the way to increase access to cheaper drugs worldwide, Pfizer said Wednesday it will provide all current and future patent-protected medicines and vaccines available in the US or EU on a not-for-profit basis to about 1.2 billion people in 45 lower-income countries.

Rwanda, Ghana, Malawi, Senegal and Uganda are the first five countries to sign on to this accord, which will also seek to blaze new paths for quick and efficient regulatory and procurement processes to reduce the usual delays in making new medicines and vaccines available in these countries.