Ver­tex shares shoot up, adding $8B in mar­ket cap af­ter cys­tic fi­bro­sis triples 'knocked it out of the park'

Ver­tex CMO Jef­frey Chodake­witz

Ver­tex came out of the chute af­ter the mar­ket closed on Tues­day boast­ing about the ef­fi­ca­cy da­ta their re­searchers are see­ing in a range of three Phase I and II stud­ies for its new triple com­bos for cys­tic fi­bro­sis. The da­ta are still ear­ly but clear­ly bode well for Ver­tex, which is work­ing hard to cast a far wider net among cys­tic fi­bro­sis pa­tients who have achieved mod­est but sig­nif­i­cant gains with their lead drug Ka­ly­de­co, which has won a sharp kick­back from pay­ers over its hefty price.

One pos­si­ble fly in the oint­ment to­day: Two pa­tients ex­pe­ri­enced a spike in liv­er en­zymes, though that re­solved af­ter they stopped ther­a­py. And that didn’t slow a mar­ket ral­ly in af­ter-hours trad­ing, with shares $VRTX soar­ing 26% on the care­ful­ly pack­aged news, adding $8 bil­lion to its mar­ket cap.

For a biotech that start­ed Tues­day with a mar­ket cap of $32 bil­lion, that’s a clean hit.

The fo­cus to­day is on VX-440, VX-152 and VX-659.

For triple com­bi­na­tion reg­i­mens us­ing VX-152 or VX-440 there was a mean ab­solute im­prove­ment in FEV1 — a key mea­sure of lung ca­pac­i­ty — from base­line of 9.7% and 12% from two Phase II stud­ies.

Bri­an Sko­r­ney, Baird an­a­lyst

For the triple us­ing VX-659, teza­caftor and iva­caftor in peo­ple with one F508del mu­ta­tion and one min­i­mal func­tion mu­ta­tion, the triple demon­strat­ed a 9.6% im­prove­ment in FEV1 in a Phase I study.

An­a­lysts of a va­ri­ety of stripes were clear­ly wowed by the da­ta. The clap­ping got start­ed quick­ly the minute the com­pa­ny’s re­lease hit the wires. Ver­tex has at­tract­ed plen­ty of buy­out talk with its suc­cess in CF, and the fo­cus now is on bil­lions of dol­lars in po­ten­tial new rev­enue – pro­vid­ed the da­ta con­tin­ue to break its way with­out any spoil­ers from ri­vals in the field.

Ver­tex “knocked it out of the park,” not­ed Baird’s Bri­an Sko­r­ney ear­ly Wednes­day. “Based on the re­port­ed re­sults, up­wards of 70% of CF pa­tients on a Ver­tex reg­i­men will like­ly see a ben­e­fit on par with what Ka­ly­de­co pro­vides to those with gat­ing mu­ta­tions.”

Ge­of­frey Porges, Leerink

Ge­of­frey Porges at Leerink, who’s urged Gilead to buy Ver­tex, put it this way:

The re­sults ex­ceed­ed our ex­pec­ta­tions for these tri­als, with all three com­bi­na­tions test­ed in the het min pop­u­la­tion ex­ceed­ing our ex­pec­ta­tions for the tri­al, and the sin­gle com­bi­na­tion stud­ied in delF508 ho­mozy­gous pa­tients al­so ex­ceed­ing our ex­pec­ta­tions. Ver­tex is study­ing four dif­fer­ent “sec­ond mech­a­nism” cor­rec­tors, added to the back­bone of its teza­caftor-iva­caftor com­bi­na­tion. Ver­tex al­so re­port­ed Cys­tic Fi­bro­sis Ques­tion­naire-Re­vised (CFQ-R) score im­prove­ments of 18.3 and 20.7 points for VX-440 200mg and 600mg, re­spec­tive­ly, com­pared to place­bo of 2.2 points. This score cal­cu­lates the qual­i­ty of life im­prove­ment on drug, and the gold-stan­dard CF treat­ment Ka­ly­de­co re­sult­ed in a low­er 8.1-8.6 point in­crease, while Orkam­bi led to a much low­er 1.5-2.9 point in­crease.

Michael Yee at Jef­feries not­ed:

VRTX showed all three dif­fer­ent triple pill com­bos worked in het-min CF pa­tients – ex­pand­ing the mar­ket and sug­gest­ing peak sales for VRTX go­ing from $2-4B to­wards $4-6B and set to be pre­mier growth sto­ry in large cap biotech now.

Ver­tex has been work­ing on four of what it de­scribes as next-gen cor­rec­tors, look­ing for the best to move ahead first. To­day Ver­tex said that it has a VX-445 Phase II study un­der­way, with a VX-659 Phase II set to be­gin in ear­ly Au­gust. VX-445 and VX-659 will be eval­u­at­ed in triple com­bi­na­tion with teza­caftor and iva­caftor in peo­ple with one F508del mu­ta­tion and one min­i­mal func­tion mu­ta­tion and will be eval­u­at­ed in peo­ple with two copies of the F508del mu­ta­tion who are al­ready re­ceiv­ing teza­caftor and iva­caftor. Da­ta from both Phase II stud­ies are ex­pect­ed in ear­ly 2018.

“These safe­ty and ef­fi­ca­cy da­ta are clear and com­pelling, in­di­cat­ing sig­nif­i­cant po­ten­tial ben­e­fit for peo­ple with CF from each of these three dif­fer­ent triple com­bi­na­tion reg­i­mens,” said Jef­frey Chodake­witz, ex­ec­u­tive vice pres­i­dent and CMO at Ver­tex.  “We will be col­lect­ing and eval­u­at­ing ad­di­tion­al da­ta from these and oth­er stud­ies and will make a de­ci­sion on which reg­i­men(s) to take for­ward in­to piv­otal pro­gram(s), which we ex­pect to be­gin in the first half of 2018.”

Is a pow­er­house Mer­ck team prepar­ing to leap past Roche — and leave Gilead and Bris­tol My­ers be­hind — in the race to TIG­IT dom­i­na­tion?

Roche caused quite a stir at ASCO with its first look at some positive — but not so impressive — data for their combination of Tecentriq with their anti-TIGIT drug tiragolumab. But some analysts believe that Merck is positioned to make a bid — soon — for the lead in the race to a second-wave combo immuno-oncology approach with its own ambitious early-stage program tied to a dominant Keytruda.

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Fangliang Zhang, AP Images

UP­DAT­ED: Leg­end fetch­es $424 mil­lion, emerges as biggest win­ner yet in pan­dem­ic IPO boom as shares soar

Amid a flurry of splashy pandemic IPOs, a J&J-partnered Chinese biotech has emerged with one of the largest public raises in biotech history.

Legend Biotech, the Nanjing-based CAR-T developer, has raised $424 million on NASDAQ. The biotech had originally filed for a still-hefty $350 million, based on a range of $18-$20, but managed to fetch $23 per share, allowing them to well-eclipse the massive raises from companies like Allogene, Juno, Galapagos, though they’ll still fall a few dollars short of Moderna’s record-setting $600 million raise from 2018.

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As it hap­pened: A bid­ding war for an an­tibi­ot­ic mak­er in a mar­ket that has rav­aged its peers

In a bewildering twist to the long-suffering market for antibiotics — there has actually been a bidding war for an antibiotic company: Tetraphase.

It all started back in March, when the maker of Xerava (an FDA approved therapy for complicated intra-abdominal infections) said it had received an offer from AcelRx for an all-stock deal valued at $14.4 million.

The offer was well-timed. Xerava was approved in 2018, four years after Tetraphase posted its first batch of pivotal trial data, and sales were nowhere near where they needed to be in order for the company to keep its head above water.

Drug man­u­fac­tur­ing gi­ant Lon­za taps Roche/phar­ma ‘rein­ven­tion’ vet as its new CEO

Lonza chairman Albert Baehny took his time headhunting a new CEO for the company, making it absolutely clear he wanted a Big Pharma or biotech CEO with a good long track record in the business for the top spot. In the end, he went with the gold standard, turning to Roche’s ranks to recruit Pierre-Alain Ruffieux for the job.

Ruffieux, a member of the pharma leadership team at Roche, spent close to 5 years at the company. But like a small army of manufacturing execs, he gained much of his experience at the other Big Pharma in Basel, remaining at Novartis for 12 years before expanding his horizons.

Covid-19 roundup: Ab­b­Vie jumps in­to Covid-19 an­ti­body hunt; As­traZeneca shoots for 2B dos­es of Ox­ford vac­cine — with $750M from CEPI, Gavi

Another Big Pharma is entering the Covid-19 antibody hunt.

AbbVie has announced a collaboration with the Netherlands’ Utrecht University and Erasmus Medical Center and the Chinese-Dutch biotech Harbour Biomed to develop a neutralizing antibody that can treat Covid-19. The antibody, called 47D11, was discovered by AbbVie’s three partners, and AbbVie will support early preclinical work, while preparing for later preclinical and clinical development. Researchers described the antibody in Nature Communications last month.

Pfiz­er’s Doug Gior­dano has $500M — and some ad­vice — to of­fer a cer­tain breed of 'break­through' biotech

So let’s say you’re running a cutting-edge, clinical-stage biotech, probably public, but not necessarily so, which could see some big advantages teaming up with some marquee researchers, picking up say $50 million to $75 million dollars in a non-threatening minority equity investment that could take you to the next level.

Doug Giordano might have some thoughts on how that could work out.

The SVP of business development at the pharma giant has helped forge a new fund called the Pfizer Breakthrough Growth Initiative. And he has $500 million of Pfizer’s money to put behind 7 to 10 — or so — biotech stocks that fit that general description.

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Bris­tol My­ers is clean­ing up the post-Cel­gene merg­er pipeline, and they’re sweep­ing out an ex­per­i­men­tal check­point in the process

Back during the lead up to the $74 billion buyout of Celgene, the big biotech’s leadership did a little housecleaning with a major pact it had forged with Jounce. Out went the $2.6 billion deal and a collaboration on ICOS and PD-1.

Celgene, though, also added a $530 million deal — $50 million up front — to get the worldwide rights to JTX-8064, a drug that targets the LILRB2 receptor on macrophages.

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GSK presents case to ex­pand use of its lu­pus drug in pa­tients with kid­ney dis­ease, but the field is evolv­ing. How long will the mo­nop­oly last?

In 2011, GlaxoSmithKline’s Benlysta became the first biologic to win approval for lupus patients. Nine years on, the British drugmaker has unveiled detailed positive results from a study testing the drug in lupus patients with associated kidney disease — a post-marketing requirement from the initial FDA approval.

Lupus is a drug developer’s nightmare. In the last six decades, there has been just one FDA approval (Benlysta), with the field resembling a graveyard in recent years with a string of failures including UCB and Biogen’s late-stage flop, as well as defeats in Xencor and Sanofi’s programs. One of the main reasons the success has eluded researchers is because lupus, akin to cancer, is not just one disease — it really is a disease of many diseases, noted Al Roy, executive director of Lupus Clinical Investigators Network, an initiative of New York-based Lupus Research Alliance that claims it is the world’s leading private funder of lupus research, in an interview.

UP­DAT­ED: Es­ti­mat­ing a US price tag of $5K per course, remde­sivir is set to make bil­lions for Gilead, says key an­a­lyst

Data on remdesivir — the first drug shown to benefit Covid-19 patients in a randomized, controlled trial setting — may be murky, but its maker Gilead could reap billions from the sales of the failed Ebola therapy, according to an estimate by a prominent Wall Street analyst. However, the forecast, which is based on a $5,000-per-course US price tag, triggered the ire of one top drug price expert.