Unit­ed Ther­a­peu­tics pays $800M-plus to grab Are­na’s PhI­II PAH drug

Unit­ed Ther­a­peu­tics $UTHR is pay­ing an $800 mil­lion cash up­front in a big bet to stay among the lead­ers in pul­monary ar­te­r­i­al hy­per­ten­sion, grab­bing rights to Are­na Phar­ma­ceu­ti­cals’ ra­linepag in the deal. And the ex­ec­u­tive crew is will­ing to add hun­dreds of mil­lions more in mile­stones if they can stay on track through to an ap­proval and com­mer­cial­iza­tion.

Unit­ed CEO Mar­tine Roth­blatt says their 20 years of ex­pe­ri­ence in the field con­vinced her that they have a win­ner on their hands.

She not­ed:

We have con­duct­ed ex­ten­sive due dili­gence on ra­linepag, ap­ply­ing our two decades of knowl­edge about PAH. We are con­fi­dent that af­ter achiev­ing FDA ap­proval via at least one of its sev­er­al dif­fer­ent po­ten­tial reg­u­la­to­ry path­ways to suc­cess, this prod­uct will help greater than 10,000 pa­tients an­nu­al­ly from the 2020s and well in­to the 2030s, while com­ple­ment­ing our ex­ist­ing port­fo­lio of PAH ther­a­pies.

Are­na’s shares $AR­NA surged about 20% pre­mar­ket on the news.

The oral drug, which is cur­rent­ly in late-stage de­vel­op­ment, is ex­pect­ed to com­pete against John­son & John­son’s $JNJ se­lex­i­pag, which the bio­phar­ma gi­ant ac­quired as part of its $30 bil­lion takeover of Eu­rope’s biotech pow­er­house Acte­lion last year.

Amit Mun­shi

Are­na is el­i­gi­ble to re­ceive po­ten­tial mile­stone pay­ments of up to $400 mil­lion un­der the deal, in­clud­ing $150 mil­lion up­on first mar­ket­ing ap­proval of ra­linepag in a ma­jor non-U.S. mar­ket, and an­oth­er $250 mil­lion up­on U.S. mar­ket­ing ap­proval of an in­haled for­mu­la­tion of ra­linepag. The San Diego-based com­pa­ny is al­so el­i­gi­ble to re­ceive cer­tain roy­al­ties on po­ten­tial net sales.

The com­pa­ny has un­der­gone a mas­sive re­or­ga­ni­za­tion af­ter its gam­ble on the obe­si­ty pill Belviq turned awry as luke­warm sales and adop­tion of the drug led to a rene­go­ti­at­ed agree­ment with part­ner Ei­sai, which ac­quired the glob­al rights to the di­et drug in 2017. In a sep­a­rate 8-K fil­ing, Are­na said that it ex­pects “a sig­nif­i­cant por­tion of the tax­able gain that would oth­er­wise be trig­gered by the up­front pay­ment will be off­set by Are­na’s net op­er­at­ing loss­es”.

In pa­tients with PAH, the right side of the heart has to work hard­er to push blood through the lungs, be­cause the pul­monary ar­ter­ies in the lung are blocked, nar­rowed or de­stroyed. This cul­mi­nates in high­er pres­sure in the right ven­tri­cle that pumps blood around the lungs, which over time weak­ens the ven­tri­cle caus­ing symp­toms such as short­ness of breath, fa­tigue and chest pain. As the con­di­tion wors­ens, the symp­toms may lim­it all phys­i­cal ac­tiv­i­ty. Al­though treat­ments have been ap­proved to man­age the symp­toms of the life-threat­en­ing con­di­tion, PAH re­mains in­cur­able.

In a mid-stage study re­port­ed in Ju­ly last year, the long-act­ing ra­linepag con­ferred a sta­tis­ti­cal­ly sig­nif­i­cant im­prove­ment in pul­monary vas­cu­lar re­sis­tance of near­ly 30 per­cent when com­pared to the place­bo, as well as gains in pa­tients’ abil­i­ty to ex­er­cise. Three Phase III tri­als are now set to test ra­linepag in a broad pa­tient pop­u­la­tion.

Joseph Schwartz

As part of an R&D day last month, Are­na laid out the mar­ket op­por­tu­ni­ty for ra­linepag with the help of key opin­ion lead­ers, as cit­ed by Leerink’s Joseph Schwartz. KOLs see ra­linepag as a mean­ing­ful play­er in the PAH field, and they ex­pect the drug’s bet­ter phar­ma­co­ki­net­ic pro­file could trans­late to a bet­ter ef­fi­ca­cy than se­lex­i­pag, which in it­self was an im­prove­ment over Unit­ed Ther­a­peu­tics’ Oren­itram, not­ed Schwartz.

Are­na will now fo­cus its re­sources on its ex­per­i­men­tal drugs etrasi­mod and olorinab that are be­ing test­ed for var­i­ous oth­er dis­or­ders.



Im­age: Mar­tine Roth­blatt. AP IM­AGES

Eli Casdin, Casdin Capital

Eli Cas­din backs Codex­is' plat­form tech with $50M eq­ui­ty buy

About a month af­ter Codex­is notched a deal with No­var­tis $NVS, the Cal­i­for­nia com­pa­ny $CDXS on Thurs­day said long-time in­vestor Cas­din Cap­i­tal is putting up $50 mil­lion in a pri­vate place­ment, which puts the New York-based in­vest­ment firm in con­trol of more than 5% of the pro­tein en­gi­neer­ing play­er’s stock.

Eli Cas­din start­ed his epony­mous in­vest­ment firm in 2012 and dates his re­la­tion­ship with Codex­is back to at least a decade. About three years ago, Cas­din Cap­i­tal be­gan in­vest­ing in the in­dus­tri­al biotech com­pa­ny, af­ter it piv­ot­ed its fo­cus to the life sci­ences — un­der the aus­pices of new chief John Nicols — away from the en­er­gy in­dus­try.

How small- to mid-sized biotechs can adopt pa­tient cen­tric­i­ty in their on­col­o­gy tri­als

By Lucy Clos­sick Thom­son, Se­nior Di­rec­tor of On­col­o­gy Pro­ject Man­age­ment, Icon

Clin­i­cal tri­als in on­col­o­gy can be cost­ly and chal­leng­ing to man­age. One fac­tor that could re­duce costs and re­duce bar­ri­ers is har­ness­ing the pa­tient voice in tri­al de­sign to help ac­cel­er­ate pa­tient en­roll­ment. Now is the time to adopt pa­tient-cen­tric strate­gies that not on­ly fo­cus on pa­tient needs, but al­so can main­tain cost ef­fi­cien­cy.

In­vestors pony up $476M for the lat­est round of biotech IPOs to hit the Street

Three biotechs — and a genome se­quenc­ing play­er — have caught the lat­est tide to the Gold Coast of IPOs, round­ing out the first half of 2019 with 23 new drug de­vel­op­ers mak­ing it on Nas­daq.

Most of these com­pa­nies filed their IPOs al­most si­mul­ta­ne­ous­ly, though we’re still wait­ing on word of fel­low class­mate Bridge­Bio’s pric­ing af­ter CEO Neil Ku­mar set the terms at $14 to $16 a share on Mon­day in search of a $240 mil­lion (or so) wind­fall. If he’s suc­cess­ful, that would take the one-week haul past the $700 mil­lion mark, a fresh sign that in­vestors’ en­thu­si­asm for new­ly coined pub­lic biotechs hasn’t cooled.

In starved an­tibi­ot­ic field, Melin­ta soars as FDA grants speedy drug re­view

Such is the state of af­fairs in an­tibi­ot­ic land that the FDA agree­ing to pri­or­i­ty re­view an ap­pli­ca­tion to ex­pand the use of an an­tibi­ot­ic can rock­et up a stock more than two-fold.

On Wednes­day, Melin­ta Ther­a­peu­tics said its ap­proved an­tibi­ot­ic Baxdela had been grant­ed pri­or­i­ty re­view for use in com­mu­ni­ty-ac­quired bac­te­r­i­al pneu­mo­nia (CAPB). The FDA is ex­pect­ed to make its de­ci­sion by Oc­to­ber 24. Shares of the Con­necti­cut drug­mak­er $ML­NT cat­a­pult­ed, clos­ing up near­ly 224% at $6.41.

Brent Saunders at an Endpoints News event in 2017 — File photo

An­a­lyst call with Al­ler­gan ex­ecs stokes an­tic­i­pa­tion of a plan to split the com­pa­ny in ‘a month or two’

So what’s up at Al­ler­gan?

Ear­li­er this week the ubiq­ui­tous Ever­core ISI an­a­lyst Umer Raf­fat was on the line with com­pa­ny ex­ec­u­tives to probe in­to the lat­est on the num­bers as well as CEO Brent Saun­ders’ re­cent de­c­la­ra­tion that he’d be do­ing some­thing de­fin­i­tive to help long-suf­fer­ing in­vestors who have watched their shares dwin­dle in val­ue.

He came away with the im­pres­sion that a sig­nif­i­cant com­pa­ny split is on the way. And not on some dis­tant time hori­zon.

Robert Forrester, Verastem

Ve­rastem CEO For­rester steps to the ex­it as the board hunts com­mer­cial-savvy ex­ec for the be­lea­guered biotech

Robert For­rester is step­ping down as CEO of Ve­rastem On­col­o­gy $VSTM just 8 months af­ter the com­pa­ny nabbed an ap­proval for du­velis­ib, a PI3K drug with a sto­ried past — and what ap­pears as not much of a fu­ture.

The biotech put out word this morn­ing that For­rester will take an ad­vi­so­ry role with Ve­rastem while COO Dan Pa­ter­son steps up to take charge of the lead­er­ship team and the board looks around for a new CEO.

John Reed at JPM 2019. Jeff Rumans for Endpoints News

Sanofi's John Reed con­tin­ues to re­or­ga­nize R&D, cut­ting 466 jobs while boost­ing can­cer, gene ther­a­py re­search

The R&D reorganization inside Sanofi is continuing, more than a year after the pharma giant brought in John Reed to head the research arm of the Paris-based company.
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The top 10 block­buster drugs in the late-stage pipeline — Eval­u­ate adds 6 new ther­a­pies to heavy-hit­ter list

Vertex comes in for a substantial amount of criticism for its no-holds-barred tactical approach toward wresting the price it wants for its commercial drugs in Europe. But the flip side of that coin is a highly admired R&D and commercial operation that regularly wins kudos from analysts for their ability to engineer greater cash flow from the breakthrough drugs they create.

Both aspects needed for success in this business are on display in the program backing Vertex’s triple for cystic fibrosis. VX-659/VX-445 + Tezacaftor + Ivacaftor — it’s been whittled down to 445 now — was singled out by Evaluate Pharma as the late-stage therapy most likely to win the crown for drug sales in 5 years, with a projected peak revenue forecast of $4.3 billion.

The latest annual list, which you can see here in their latest world preview, includes a roster of some of the most closely watched development programs in biopharma. And Evaluate has added 6 must-watch experimental drugs to the top 10 as drugs fail or go on to a first approval. With apologies to the list maker, I revamped this to rank the top 10 by projected 2024 sales, instead of Evaluate's net present value rankings.

It's how we roll at Endpoints News.

Here is a quick summary of the rest of the top 10:

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Ken Frazier appears before the Senate Committee on Finance for a hearing on prescription drug pricing on Capitol Hill in Washington, DC, February 26, 2019. Chris Kleponis for CNP via AP Images

Who’s next in line to suc­ceed Ken Fra­zier as CEO of the Keytru­da-blessed Mer­ck?

When Merck waved off a looming forced retirement for Ken Frazier last September, the board cited flexibility in CEO transition as a key factor in the decision. Having Frazier — who’s also chairman of the company — around beyond his 65th birthday in 2019 would ensure they install the best person at the best time, they said.

The board has evidently begun that process with a clear preference for internal candidates, sources told Bloomberg. CFO Robert Davis, chief marketing officer Michael Nally, and chief commercial officer Frank Clyburn are all in the running, according to an insider.

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