Where the mon­ey is: Biotech’s megahubs com­mand VC's bil­lions

 

When it comes to the ge­og­ra­phy of biotech mon­ey, there’s the Bay Area/Sil­i­con Val­ley and the Boston/Cam­bridge hub at the epi­cen­ter of the North­east’s key re­gion.

And then there’s every­thing else.

As part of a se­ries on ven­ture cap­i­tal and biotech, End­points asked the an­a­lysts at Thom­son Reuters to run the num­bers on where the life sci­ences in­vest­ment mon­ey flowed last year. They tracked  $3.5 bil­lion for Sil­i­con Val­ley plus the Bay Area and $2.8 bil­lion for New Eng­land. Bro­ken down by city, $6.1 bil­lion went to Boston ($2.7 bil­lion), San Jose ($2.5 bil­lion) and San Fran­cis­co/Berke­ley ($1 bil­lion).

To put that in­to per­spec­tive, that was eas­i­ly more than half of the $11 bil­lion in life sci­ences in­vest­ment cash tracked by Thom­son Reuters last year.

Af­ter the Big 3 you’ll find San Diego ($725 mil­lion), New York ($454 mil­lion) and the Great Lakes area ($412 mil­lion) round­ing out the top 5.

That $5 bil­lion tracked by Thom­son Reuters that fell out­side the megahubs rep­re­sents a big part of the record wave of cash that has been flow­ing through the start­up side of the busi­ness in re­cent years. But the num­bers al­so re­flect a harsh re­al­i­ty for com­pa­nies off the beat­en track: VCs of­ten like to keep their in­vest­ments close to home, and they long ago grav­i­tat­ed in­to the megahubs.

That trend has big im­pli­ca­tions.

While San Diego and to a less­er ex­tent New York have done well, the fur­ther you are off the home turf of the VCs, the less like­ly it is you can find sup­port. So ex­ec­u­tives tend to con­gre­gate around the megahubs as Big Phar­ma looks to raise the flag at the epi­cen­ter of R&D – a trend that has helped make Kendall Square be­come one of the most ex­pen­sive places in the world to do drug re­search.

And it’s a trend that reach­es be­yond U.S. shores.

Eval­u­ate Phar­ma re­cent­ly con­clud­ed that UK biotechs raised 489 mil­lion pounds ($655 mil­lion based on the new, post-Brex­it val­ue of the pound) in 2015, which would qual­i­fy as the 5th largest hub if it was fit­ted in­to the U.S. list. More transat­lantic cash has been adding mon­ey to the mix, but the UK still rep­re­sents a trip that many VCs don’t want to make.

With more mon­ey to in­vest we’re see­ing more megarounds for up­starts, which in­cludes $250 mil­lion for Stem­cen­trx (South San Fran­cis­co, bought by Ab­b­Vie) and the $217 mil­lion De­nali (South San Fran­cis­co) start­up round. Mod­er­na (Cam­bridge) raised a block­buster $450 mil­lion. And it’s no sur­prise that all three are in the coun­try’s two big hubs.

This re­port fol­lows last week’s by-the-num­bers break­down on the top VCs, which you can find here.

 

Fol­low­ing news of job cuts in Eu­ro­pean R&D ops, Sanofi con­firms it’s of­fer­ing US work­ers an 'ear­ly ex­it'

Ear­li­er in the week we learned that Sanofi was bring­ing out the bud­get ax to trim 466 R&D jobs in Eu­rope, re­tool­ing its ap­proach to car­dio as re­search chief John Reed beefed up their work in can­cer and gene ther­a­pies. And we’re end­ing the week with news that the phar­ma gi­ant has al­so been qui­et­ly re­duc­ing staff in the US, tar­get­ing hun­dreds of jobs as the com­pa­ny push­es vol­un­tary buy­outs with a fo­cus on R&D sup­port ser­vices.

Roger Perlmutter. Merck via webcast

'Our lega­cy mat­ter­s': Mer­ck maps out Keytru­da king­dom while spot­light­ing ad­vances in vac­cines, hos­pi­tal care

“You can for the mo­ment stop tak­ing notes. You can put down your pens and your pad. I have no slides. I have no sub­stan­tive da­ta. I have no pitch.”

So be­gan Roger Perl­mut­ter’s brief ap­pear­ance on­stage at Mer­ck’s first in­vestor day in five years, where he dived in­to the com­pa­ny’s his­to­ry dat­ing back to 1933. The first em­ploy­ees at Mer­ck Re­search Lab­o­ra­to­ries, hand­picked by founder George W. Mer­ck, were crit­i­cal to Mer­ck’s abil­i­ty to achieve clin­i­cal and com­mer­cial suc­cess.

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.

Why would the FDA ap­prove an­oth­er con­tro­ver­sial drug to spur a woman’s li­bido with these da­ta? And why no ex­pert pan­el re­view?

AMAG Pharmaceuticals’ newly approved drug for spurring women’s sexual desire may never make much money, but it’s a big hit at sparking media attention.

The therapy — Vyleesi (bremelanotide) — got the green light from regulators on Friday evening, swiftly lighting up a range of stories around the world, from The New York Times to The Guardian. Several headlines inevitably referred to it as the “female Viagra,” invoking Pfizer’s old erectile dysfunction blockbuster.

But the two drugs have little in common.

Endpoints News

Basic subscription required

Unlock this story instantly and join 53,300+ biopharma pros reading Endpoints daily — and it's free.

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.

Endpoints News

Basic subscription required

Unlock this story instantly and join 53,300+ biopharma pros reading Endpoints daily — and it's free.

Re­gen­eron/Sanofi's an­ti­body un­der­whelms in asth­ma study — shares of ri­val Anap­tys­Bio pay the price

Al­though ex­pec­ta­tions were mut­ed, Re­gen­eron $REGN and Sanofi’s $SNY ex­per­i­men­tal IL-33 an­ti­body has un­der­whelmed in a proof-of-con­cept mid-stage asth­ma tri­al. Al­though the drug sig­nif­i­cant­ly im­proved the loss of asth­ma con­trol and lung func­tion as a monother­a­py com­pared to a place­bo, its ef­fect was nei­ther su­pe­ri­or to the es­tab­lished Dupix­ent, nor of val­ue when com­bined with the IL-4/IL-13 treat­ment.

Green-light­ed in Japan, FDA quick­ly spurns Dai­ichi Sanky­o's flawed ap­pli­ca­tion for AML drug

Three days af­ter win­ning Japan­ese ap­proval for its acute myeloid leukemia drug quizar­tinib, Dai­ichi Sankyo is be­ing forced to en­dure an em­bar­rass­ing re­jec­tion at the hands of the FDA.

US reg­u­la­tors wast­ed no time in bat­ting back quizar­tinib af­ter first high­light­ing the messy da­ta in its ap­pli­ca­tion in an in­ter­nal re­view, that in turn per­suad­ed a large ma­jor­i­ty of out­side ex­perts to rec­om­mend a re­jec­tion for the drug, which tar­gets FLT3-ITD–pos­i­tive AML cas­es.

Which top 10 big phar­mas have the most to gain — or lose — over the next 5 years?

When Evaluate Pharma crunched the likely drug sales numbers for the big 10, 2 stood out. 

Takeda, with its big Shire buyout under its belt, is set to almost double its worldwide sales record for 2018 over 5 years, putting it in the big 10 — the 9th spot, to be exact — which is exactly where CEO Christophe Weber wants to be. 

Endpoints News

Basic subscription required

Unlock this story instantly and join 53,300+ biopharma pros reading Endpoints daily — and it's free.

HIV, pneu­mo­coc­cal — and what? Mer­ck­'s un­ex­pect­ed pipeline high­light ex­cites a lit­tle biotech

In an R&D update dominated by oncology — mostly Keytruda, followed by Lynparza and Lenvima — Merck chose to highlight a program in sensory pathology, an HIV drug, and a group of pneumococcal vaccines. And that has made at least one biotech very happy.

Endpoints News

Basic subscription required

Unlock this story instantly and join 53,300+ biopharma pros reading Endpoints daily — and it's free.