Top stories of the week: Thumbs up/Thumbs down
Endpoints assesses the big biopharma R&D stories of the week, with a little added commentary on what they mean for the industry.
Celgene taps its new biotech co-star
This was the perfect week to answer a question I’ve been thinking about regarding Celgene. The Big Biotech, which has specialized in lining up rich deals for star collaborators, has settled on Jounce as its latest pick for up-and-coming biotech with the most potential. Celgene has been stitching together a whole pipeline of immuno-oncology drugs through its BD team, headed by George Golumbeski. Our chart on all its pacts, and the $3.2 billion it spent on deals over the past two years, proved to be the most popular part of the week. Those deals also illustrate how industry partnerships drive new programs. Important point: It’s not over at Celgene.
What were they thinking at Zafgen?
There aren’t many biotechs which handle setbacks well. Zafgen, though, has become a case study in cluelessness. After insisting for months that they had compelling pivotal data and an effective plan to get its obesity drug back on track after the death of two patients, Zafgen had to acknowledge this week that the drug is dead. But only after touting preclinical data for their new, unknown lead drug. By the end of this week, the company’s shares are trading at half cash, not what you would call a ringing endorsement for the new plan or the way they handled themselves in the crisis. There’s no question about the company’s sincerity—these are smart, experienced and committed players who lost their way–but as analysts turn their backs on Zafgen, that may not matter much anyway. This is a teachable moment in crisis PR. Don’t waste it.
The Scangos legacy issue
George Scangos arrived on the scene at Biogen six years ago as its savior. He leaves as the company looks for a new messiah. But what a ride. He and his new team pushed Tecfidera through, and made it a blockbuster in the MS market. In the middle of a biotech boom, Biogen could boast major league status alongside Gilead and Celgene. Then the sales weakened, pipeline setbacks tarnished their image, an overhaul was in order and the company is now in line for a new makeover, it might even be acquired. Maybe Scangos stayed a year too long and trusted in home run swings too much. But no one can take away the winning years.
The biopharma migration to the hubs continues
We’ve been gathering some fresh evidence this week on just how popular the two big biotech hubs are in the U.S. Merck has been prepping a big move into a new campus in the Bay Area as more researchers are being pulled into Boston/Cambridge. And Germany’s Merck KGaA unveiled its blueprint for a new campus in Burlington, MA. Big biopharma R&D loves the hubs, as companies look to put themselves in the mainstream of all the best science. It doesn’t hurt that these two big hubs already host most of the startup companies in biotech.
More uncertainty in a new round of reorganizations
But of course there’s a down side to every big trend. The latest reorganizations coming hand in hand with downsizing some operations, as Merck made clear. AstraZeneca has also been culling its U.S. ranks in Maryland and Massachusetts. The biggest research groups began to overhaul R&D about 7 or 8 years ago now. Merck, Pfizer, AstraZeneca, Sanofi, Roche and others all took a big swing at their organizations, looking to find some real efficiencies from the multibillion dollar operations committed to drug development. These latest reorganizations underscore the fact that anyone looking for job security might want to find another line of work, or a different place to do it. If it’s not about downsizing, there’s always a rejig in core focus areas. Still, few industries offer the kind of short-term opportunities as biopharma R&D; ask any serial entrepreneur in the field.
Perhaps it was an unintended consequence, but the government reshuffle following the Brexit vote in the UK cost the industry its dedicated minister for the life sciences. George Freeman heads to bigger and better things at a time the industry faces a crisis of confidence it can ill afford. Leaving the EU means waving off EU research cash and talent from the continent, something the Golden Triangle can miss badly as it looks to establish their life sci reputation. On the other hand, the UK contingent of biotech has a scrappy underdog side to it that will see it through to better days. Stay calm and carry on. It’s worked before.