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.

2019 Trin­i­ty Drug In­dex Eval­u­ates Ac­tu­al Com­mer­cial Per­for­mance of Nov­el Drugs Ap­proved in 2016

Fewer Approvals, but Neurology Rivals Oncology and Sees Major Innovations

This report, the fourth in our Trinity Drug Index series, outlines key themes and emerging trends in the industry as we progress towards a new world of targeted and innovative products. It provides a comprehensive evaluation of the performance of novel drugs approved by the FDA in 2016, scoring each on its commercial performance, therapeutic value, and R&D investment (Table 1: Drug ranking – Ratings on a 1-5 scale).

How to cap­i­talise on a lean launch

For start-up biotechnology companies and resource stretched pharmaceutical organisations, launching a novel product can be challenging. Lean teams can make setting a launch strategy and achieving your commercial goals seem like a colossal undertaking, but can these barriers be transformed into opportunities that work to your brand’s advantage?
We spoke to Managing Consultant Frances Hendry to find out how Blue Latitude Health partnered with a fledgling subsidiary of a pharmaceutical organisation to launch an innovative product in a
complex market.
What does the launch environment look like for this product?
FH: We started working on the product at Phase II and now we’re going into Phase III trials. There is a significant unmet need in this disease area, and everyone is excited about the launch. However, the organisation is still evolving and the team is quite small – naturally this causes a little turbulence.

Roche's check­point play­er Tecen­triq flops in an­oth­er blad­der can­cer sub­set

Just weeks after Merck’s star checkpoint inhibitor Keytruda secured FDA approval for a subset of bladder cancer patients, Swiss competitor Roche’s Tecentriq has failed in a pivotal bladder cancer study.

The 809-patient trial — IMvigor010 — tested the PD-L1 drug in patients with muscle-invasive urothelial cancer (MIUC) who had undergone surgery, and were at high risk for recurrence.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 70,400+ biopharma pros reading Endpoints daily — and it's free.

2019 a 'trans­for­ma­tive year' for phar­ma M&A. Is that a good thing?

Big Pharma keeps getting bigger.

Fueled by the mega-mergers between Bristol-Myers Squibb and Celgene and between Allergan and AbbVie, the industry last year saw $350 billion worth of M&A, according to the new year-end report from the consultants at PwC.  That’s a more than 50% increase on 2018.

“I kind of look at 2019 as a transformational year,” report author Glen Hunzinger told Endpoints News. 

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 70,400+ biopharma pros reading Endpoints daily — and it's free.

UP­DAT­ED: Eli Lil­ly’s $1.6B can­cer drug failed to spark even the slight­est pos­i­tive gain for pa­tients in its 1st PhI­II

Eli Lilly had high hopes for its pegylated IL-10 drug pegilodecakin when it bought Armo last year for $1.6 billion in cash. But after reporting a few months ago that it had failed a Phase III in pancreatic cancer, without the data, its likely value has plunged. And now we’re getting some exact data that underscore just how little positive effect it had.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 70,400+ biopharma pros reading Endpoints daily — and it's free.

Stephen Hahn, AP

The FDA has de­val­ued the gold stan­dard on R&D. And that threat­ens every­one in drug de­vel­op­ment

Bioregnum Opinion Column by John Carroll

A few weeks ago, when Stephen Hahn was being lightly queried by Senators in his confirmation hearing as the new commissioner of the FDA, he made the usual vow to maintain the gold standard in drug development.

Neatly summarized, that standard requires the agency to sign off on clinical data — usually from two, well-controlled human studies — that prove a drug’s benefit outweighs any risks.

Over the last few years, biopharma has enjoyed an unprecedented loosening over just what it takes to clear that bar. Regulators are more willing to drop the second trial requirement ahead of an accelerated approval — particularly if they have an unmet medical need where patients are clamoring for a therapy.

That confirmatory trial the FDA demands can wait a few years. And most everyone in biopharma would tell you that’s the right thing for patients. They know its a tonic for everyone in the industry faced with pushing a drug through clinical development. And it’s helped inspire a global biotech boom.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 70,400+ biopharma pros reading Endpoints daily — and it's free.

UP­DAT­ED: New play­ers are jump­ing in­to the scram­ble to de­vel­op a vac­cine as pan­dem­ic pan­ic spreads fast

When the CNN news crew in Wuhan caught wind of the Chinese government’s plan to quarantine the city of 11 million people, they made a run for one of the last trains out — their Atlanta colleagues urging them on. On the way to the train station, they were forced to skirt the local seafood market, where the coronavirus at the heart of a brewing outbreak may have taken root.

And they breathlessly reported every moment of the early morning dash.

In shuttering the city, triggering an exodus of masked residents who caught wind of the quarantine ahead of time, China signaled that they were prepared to take extreme actions to stop the spread of a virus that has claimed 17 lives, sickened many more and panicked people around the globe.

CNN helped illustrate how hard all that can be.

The early reaction in the biotech industry has been classic, with small-cap companies scrambling to headline efforts to step in fast. But there are also new players in the field with new tech that has been introduced since the last of a series of pandemic panics that could change the usual storylines. And they’re volunteering for a crash course in speeding up vaccine development — a field where overnight solutions have been impossible to prove.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 70,400+ biopharma pros reading Endpoints daily — and it's free.

UP­DAT­ED: FDA’s golodirsen CRL: Sarep­ta’s Duchenne drugs are dan­ger­ous to pa­tients, of­fer­ing on­ly a small ben­e­fit. And where's that con­fir­ma­to­ry tri­al?

Back last summer, Sarepta CEO Doug Ingram told Duchenne MD families and investors that the FDA’s shock rejection of their second Duchenne MD drug golodirsen was due to some concerns regulators raised about the risk of infection and the possibility of kidney toxicity. But when pressed to release the letter for all to see, he declined, according to a report from BioPharmaDive, saying that kind of move “might not look like we’re being as respectful as we’d like to be.”

He went on to assure everyone that he hadn’t misrepresented the CRL.

But Ingram’s public remarks didn’t include everything in the letter, which — following the FDA’s surprise about-face and unexplained approval — has now been posted on the FDA’s website and broadly circulated on Twitter early Wednesday.

The CRL raises plenty of fresh questions about why the FDA abruptly decided to reverse itself and hand out an OK for a drug a senior regulator at the FDA believed — 5 months ago, when he wrote the letter — is dangerous to patients. It also puts the spotlight back on Sarepta $SRPT, which failed to launch a confirmatory study of eteplirsen, which was only approved after a heated internal controversy at the FDA. Ellis Unger, director of CDER’s Office of Drug Evaluation I, notes that study could have clarified quite a lot about the benefit and risks associated with their drugs — which can cost as much as a million dollars per patient per year, depending on weight.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 70,400+ biopharma pros reading Endpoints daily — and it's free.

Wuhan virus out­break trig­gers in­evitable small-biotech ral­ly

Every few years, a public health crisis (think Ebola, Zika) spurred by a rogue pathogen triggers a small-biotech rally, as drugmakers emerge from the woodwork with ambitious plans to treat the mounting outbreak. In most cases, that enthusiasm never quite delivers.

Things are no different, as the coronavirus outbreak in Wuhan, China takes hold. There have been close to 300 confirmed human infections in China, and at least four deaths. Coronaviruses are a large family of viruses, which include MERS and SARS. On Tuesday, the CDC reported the virus was detected in a US traveler returning from Wuhan.