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.

 

Brian Kaspar. AveXis via Twitter

AveX­is sci­en­tif­ic founder fires back at No­var­tis CEO Vas Narasimhan, 'cat­e­gor­i­cal­ly de­nies any wrong­do­ing'

Brian Kaspar’s head was among the first to roll at Novartis after company execs became aware of the fact that manipulated data had been included in its application for Zolgensma, now the world’s most expensive therapy.

But in his first public response, the scientific founder at AveXis — acquired by Novartis for $8.7 billion — is firing back. And he says that not only was he not involved in any wrongdoing, he’s ready to defend his name as needed.

I reached out to Brian Kaspar after Novartis put out word that he and his brother Allen had been axed in mid-May, two months after the company became aware of the allegations related to manipulated data. His response came back through his attorneys.

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We­bi­nar: Re­al World End­points — the brave new world com­ing in build­ing fran­chise ther­a­pies

Several biopharma companies have been working on expanding drug labels through the use of real world endpoints, combing through the data to find evidence of a drug’s efficacy for particular indications. But we’ve just begun. Real World Evidence is becoming an important part of every clinical development plan, in the soup-through-nuts approach used in building franchises.

I’ve recruited a panel of 3 top experts in the field — the first in a series of premium webinars — to look at the practical realities governing what can be done today, and where this is headed over the next few years, at the prodding of the FDA.


ZHEN SU — Merck Serono’s Senior Vice President and Global Head of Oncology


ELLIOTT LEVY — Amgen’s Senior Vice President of Global Development


CHRIS BOSHOFF — Pfizer Oncology’s Chief Development Officer

A premium subscription to Endpoints News is required to attend this webinar. Please upgrade to either an Insider or Enterprise plan for access. Already have Endpoints Premium? Please sign-in below. You can contact our Subscriptions team at help@endpointsnews.com with any issues.

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Bob Smith, Pfizer

Pfiz­er is mak­ing a $500M state­ment to­day: Here’s how you be­come a lead play­er in the boom­ing gene ther­a­py sec­tor

Three years ago, Pfizer anted up $150 million in cash to buy Bamboo Therapeutics in Chapel Hill, NC as it cautiously stuck a toe in the small gene therapy pool of research and development.

Company execs followed up a year later with a $100 million expansion of the manufacturing operations they picked up in that deal for the UNC spinout, which came with $495 million in milestones.

And now they’re really going for it.

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Video: Putting the AI in R&D — with Badhri Srini­vasan, Tony Wood, Rosana Kapeller, Hugo Ceule­mans, Saurabh Sa­ha and Shoibal Dat­ta

During BIO this year, I had a chance to moderate a panel among some of the top tech experts in biopharma on their real-world use of artificial intelligence in R&D. There’s been a lot said about the potential of AI, but I wanted to explore more about what some of the larger players are actually doing with this technology today, and how they see it advancing in the future. It was a fascinating exchange, which you can see here. The transcript has been edited for brevity and clarity. — John Carroll

UP­DAT­ED: As­traZeneca’s Imfinzi/treme com­bo strikes out — again — in lung can­cer. Is it time for last rites?

AstraZeneca bet big on the future of their PD-L1 Imfinzi combined with the experimental CTLA-4 drug tremelimumab. But once again it’s gone down to defeat in a major Phase III study — while adding damage to the theory involving targeting cancer with a high tumor mutational burden.

Early Wednesday the pharma giant announced that their NEPTUNE study had failed, with the combination unable to beat standard chemo at overall survival in high TMB cases of advanced non-small cell lung cancer. We won’t get hard data until later in the year, but the drumbeat of failures will call into question what — if any — future this combination can have left.

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SEC calls out lit­tle Ther­a­peu­tic­sMD for its in­sid­er con­tacts with an­a­lysts to boost share price, then halt rout

Back in May 2017, following an FDA rejection, TherapeuticsMD saw its share price plummet to the lowest levels in two years. The little Florida biotech eventually found its way back to the good side of regulators, scoring a curious OK a year later for its therapy preventing vaginal pain during sex. But the SEC is now accusing it of selectively disclosing nonpublic information in attempts to manipulate its stock.

In two instances in June and July of 2017, TherapeuticsMD allegedly violated the Regulation Fair Disclosure rule by sharing material information with certain sell-side analysts and not the public, resulting in a more favorable stock move than otherwise would be expected.

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Therapists Marcela Ot'alora and Bruce Poulter are trained to conduct MDMA-assisted psychotherapy. In this reenactment, they demonstrate how they help guide and watch over a patient who is revisiting traumatic memories while under the influence of MDMA. (Photo: Multidisciplinary Association for Psychedelic Studies)

MD­MA, now in Phase III, shows promise as a PTSD treat­ment

The first time Lori Tipton tried MDMA, she was skeptical it would make a difference.

“I really was, at the beginning, very nervous,” Tipton said.

MDMA is the main ingredient in the club drug known as ecstasy or molly. But Tipton wasn’t taking pills sold on the street to get high. She was trying to treat her post-traumatic stress disorder by participating in a clinical trial.

After taking a dose of pure MDMA, Tipton lay in a quiet room with two specially trained psychotherapists. They sat next to her as she recalled some of her deepest traumas, such as discovering her mother’s body after Tipton’s mother killed two people and then herself in a murder-suicide.

Ted Ashburn. Oncorus

Cowen, Per­cep­tive lead $79.5M Se­ries B for 's­tand­out' biotech shep­herd­ing on­colyt­ic virus to clin­ic

As several Big Pharma players secure biotech partners in the oncolytic virus space for new immuno-oncology combos, Cowen and Perceptive Advisors have come out with their own bet on a startup that promises to shine.

The marquee investors are joining MPM, Deerfield, Celgene, Astellas, Arkin Bio Ventures and UBS Oncology Impact Fund in backing the drug developer, Oncorus, which will now deploy the $79.5 million in Series B cash toward clinical development of its lead program. Other new investors include Surveyor Capital, Sphera Funds, IMM Investment, QUAD Investment Management, UTC Investment, SV Investment Corp and Shinhan Investment-Private Equity, the last five of which are Korean-based funds.

Fu­til­i­ty analy­sis au­gurs de­feat in piv­otal tri­al test­ing of Nu­Cana's lead drug in metasta­t­ic pan­cre­at­ic can­cer

Nearly two years after making its public debut, UK-based NuCana’s mission to make chemotherapies more potent and safer was dealt a blow, after a pivotal study testing its lead experimental drug halted enrollment in a hard-to-treat advanced form of cancer, following a futility analysis.

The drug, Acelarin, is being evaluated for use in metastatic pancreatic cancer patients who were not considered suitable for combination chemotherapy. In the late-stage ACELARATE study — which compared the experimental drug against the chemotherapy gemcitabine — 200 patients had been enrolled by the sponsor, Clatterbridge Cancer Centre, before an analysis from an independent safety and data monitoring panel suggested the study’s main goal would not be met.