Un­der pres­sure, Pe­ter Hecht splits Iron­wood in­to two biotechs, spin­ning out an R&D op­er­a­tion

Iron­wood $IR­WD is split­ting up its busi­ness in­to two dis­tinct halves, spin­ning out a pipeline of ear­ly- and mid-stage drugs in­to a sep­a­rate, pub­licly trad­ed biotech com­pa­ny while keep­ing its mar­ket­ed prod­ucts and re­lat­ed de­vel­op­ment projects in house at a scaled down, and more prof­itable, moth­er com­pa­ny. 

In a bid to cre­ate “two fo­cused, growth com­pa­nies,” CEO Pe­ter Hecht is keep­ing its two ap­proved drugs, lina­clotide (Linzess) and lesin­u­rad (Zu­rampic), at Iron­wood, along with IW-3718, an ex­per­i­men­tal ther­a­py for per­sis­tent gas­troe­sophageal re­flux dis­ease (GERD) with Phase III tri­als ex­pect­ed to launch in the third quar­ter of this year.

Then there is “R&D Co.,” which will start out in search of a new name for it­self. The com­pa­ny will own:

— Prali­ciguat, in Phase II for heart fail­ure with pre­served ejec­tion frac­tion (HF­pEF) and for di­a­bet­ic nephropa­thy.

— Olin­ciguat, in Phase II tar­get­ing sick­le cell dis­ease and acha­la­sia.

— And there’s a line­up of sGC stim­u­la­tors, with IW-6463 in de­vel­op­ment for se­vere cen­tral ner­vous sys­tem dis­eases; with “oth­er dis­cov­ery pro­grams tar­get­ing se­vere liv­er and lung dis­eases.”

Iron­wood’s shares slid on the news, down 9% in ear­ly-morn­ing trad­ing.

Alex Den­ner

The move comes fast on the heels of the ar­rival of Alex Den­ner, a high pro­file ac­tivist in­vestor who’s been knock­ing on their doors in search of a board po­si­tion. Den­ner has shak­en up a big group of biotechs in his time work­ing with Carl Ic­ahn and then on his own at Saris­sa Cap­i­tal. Sev­er­al an­a­lysts think the com­pa­ny could do bet­ter on the stock price, and Den­ner is all about val­ue cre­ation — with a big ap­petite for prof­it­ing from tur­bu­lence.

Hecht, who found­ing the com­pa­ny and shep­herd­ed the pipeline, had this to say ahead of a con­fer­ence call Tues­day morn­ing:

“The pos­i­tive Phase IIb da­ta from IW-3718, com­bined with the sig­nif­i­cant progress with­in our sGC plat­form, in­clud­ing re­cent Phase IIa prali­ciguat da­ta, cat­alyzed our abil­i­ty to sep­a­rate in­to two fo­cused, durable busi­ness­es poised for long-term growth.”

Both com­pa­nies will have their own, sep­a­rate man­age­ment and boards.


Im­age: Pe­ter Hecht. IRON­WOOD

Biotech and Big Phar­ma: A blue­print for a suc­cess­ful part­ner­ship

Strategic partnerships have long been an important contributor to how drugs are discovered and developed. For decades, big pharma companies have been forming alliances with biotech innovators to increase R&D productivity, expand geographical reach and better manage late-stage commercialization costs.

Noël Brown, Managing Director and Head of Biotechnology Investment Banking, and Greg Wiederrecht, Ph.D., Managing Director in the Global Healthcare Investment Banking Group at RBC Capital Markets, are no strangers to the importance of these tie-ups. Noël has over 20 years of investment banking experience in the industry. Before moving to the banking world in 2015, Greg was the Vice President and Head of External Scientific Affairs (ESA) at Merck, where he was responsible for the scientific assessment of strategic partnership opportunities worldwide.

No­var­tis' sec­ond at­tempt to repli­cate a stun­ning can­cer re­sult falls flat

Novartis’ hopes of turning one of the most surprising trial data points of the last decade into a lung cancer drug has taken another setback.

The Swiss pharma announced Monday that its IL-1 inhibitor canakinumab did not significantly extend the lives or slow the disease progression of patients with previously untreated locally advanced or metastatic non-small cell lung cancer when compared to standard of-care alone.

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How Chi­na turned the ta­bles on bio­phar­ma's glob­al deal­mak­ing

Fenlai Tan still gets chills thinking about the darkest day of his life.

Three out of eight lung cancer patients who received a tyrosine kinase inhibitor developed by his company, Betta Pharma, died in the span of a month. Tan, the chief medical officer, was summoned to Peking Union Medical College Hospital, where the head of the clinical trial department told him that the trial investigators would be conducting an autopsy to see if the patients had died of the disease — they were all very sick by the time they enrolled — or of interstitial lung disease, a deadly side effect tied to the TKI class that’s been reported in Japan.

An­gion's or­gan dam­age drug strikes out again, this time in high-risk kid­ney trans­plant pa­tients

After flopping a test in Covid-19 earlier this year, Angion’s lead organ damage drug has now hit the skids again in kidney transplant patients.

Angion and partner Vifor Pharma’s ANG-3777 failed to beat out placebo in terms of improving eGFR, a measure of kidney function, in patients who had received a deceased donor kidney transplant and were at high risk of developing what is known as delayed graft function, according to Phase III results released Tuesday.

An image of Alzheimer's brain tissue. The red show gingipains, a protein from P. gingivalis, intermixing with neurons (yellow) and glial cells (green)

An Alzheimer's dark­horse fails its first big tri­al, but of­fers hope for a long-over­looked hy­poth­e­sis

Three years ago, Cortexyme emerged out of obscurity with some big-name backers and an unorthodox approach to treating Alzheimer’s.

They moved their drug into a pivotal study the next year, offering one of the first major tests for a hypothesis that has fluttered on the outskirts of Alzheimer’s research for decades: that, in many cases, the disease is driven by infectious agents — the havoc they wreak in the brain and the inflammation the body uses to try to fend them off. And that quashing the infection could slow patients’ cognitive decline.

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No­var­tis dumps AveX­is pro­gram for Rett syn­drome af­ter fail­ing re­peat round of pre­clin­i­cal test­ing

Say goodbye to AVXS-201.

The Rett syndrome gene therapy drug made by AveXis — the biotech that was bought, kept separate, then renamed and finally absorbed by Novartis into its R&D division — has been dropped by the biopharma.

In Novartis’ third quarter financial report, the pharma had found that preclinical data did not support development of the gene therapy into IND-enabling trials and beyond. The announcement comes a year after Novartis told the Rett Society how excited it was by the drug — and its potential benefits and uses.

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Peter Nell, Mammoth Biosciences CBO

UP­DAT­ED: Jen­nifer Doud­na spin­out inks a Mam­moth CRISPR deal with Ver­tex worth near­ly $700M

When a company gets its start in gene editing pioneer Jennifer Doudna’s lab, it’s bound to make headlines. But three years in, the fanfare still hasn’t died down for Mammoth Biosciences. Now, the Brisbane, CA-based company is cheering on its first major R&D pact.

Mammoth unveiled a nearly $700 million deal with Vertex on Tuesday morning, good for the development of in vivo gene therapies for two mystery diseases. The stars of the show are Mammoth’s ultra-small CRISPR systems, including two Cas enzymes licensed from Doudna’s lab over the past couple years, Cas14 and Casɸ.

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FDA is much worse than its reg­u­la­to­ry peers at proac­tive­ly dis­clos­ing da­ta, re­searchers find

The European Medicines Agency and Health Canada continue to outpace the FDA when it comes to proactively releasing data on drugs and biologics the agency has reviewed, leading to further questions of why the American agency can’t be more transparent.

In a study published recently in the Journal of Law, Medicine, & Ethics, Yale and other academic lawyers and researchers found that between 2016 and April 2021, the EMA proactively released data for 123 unique medical products, while Health Canada proactively released data for 73 unique medical products between 2019 and April 2021. What’s more, the EMA and Health Canada didn’t proactively release the same data on the same drugs. In stark contrast, the FDA in 2018 only proactively disclosed data supporting one drug that was approved that year.

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NYU surgeon transplants an engineered pig kidney into the outside of a brain-dead patient (Joe Carrotta/NYU Langone Health)

No, sci­en­tists are not any clos­er to pig-to-hu­man trans­plants than they were last week

Steve Holtzman was awoken by a 1 a.m. call from a doctor at Duke University asking if he could put some pigs on a plane and fly them from Ohio to North Carolina that day. A motorcyclist had gotten into a horrific crash, the doctor explained. He believed the pigs’ livers, sutured onto the patient’s skin like an external filter, might be able to tide the young man over until a donor liver became available.