The Big Red Biotech Blog

ADCs Prominent in Celgene-Sutro Deal

Sutro Biopharma and Celgene struck a deal that could be worth as much as $500 M plus royalties to Sutro if milestones are met.  Celgene will gain access to Sutro technology that enables it to make biologicals by  a cell free protein synthesis approach.  Sutro will make drugs from Celgenes pipeline including both bi-specific Abs and ADCs to two undisclosed targets. Sutro will get a "substantial [undisclosed]" cash upfront and Celgene will make an equity investment and provide R&D funding. 

The Sutro ADC technology is considered to be next generation compared to that of leaders Seattle Genetics and ImmunoGen.  Mainly, the Sutro technology can incorporate non-natural amino acids in specific sites to allow it to make single species ADCs by conjugation of linker and payload at the site. Sutro can also identify the optimal sites in antibodies to make these site specific insertions. This leads to more controlled molecules and shorter timelines in development.

Sutro has been on a bit of a roll with other development deals with the likes of Pfizer.  They also have from venture investments from Lilly and Amgen venture groups among others. I like to see ADCs becoming more successful in the market and look forward to more exploitation of this technology. See Xconomy and Fierce Biotech.

Posted by Bruce Lehr Dec 18th 2012.

ADCs Clear Another Hurdle as Adcetris Gains EU Approval

Backers of ADCs have more good news coming from Europe today as the EU approves Adcetris for use in the treatment of relapsesed Hodgkin's and ALCL.  Millennium (Takeda) licensed rights to sell the product outside the US from its inventor Seattle Genetics and will now pay the latter a $25 M milestone.  SeaGen will also receive tiered double digit royalties on the sales of the product.

Thus ADCs continue their role as one of the hottest new technologies in the treatment of cancers. SeaGen has already generated nearly $150 M in sales in the US since the drug's approval earlier this year.  Many companies now have ADC programs in their pipelines and there are 10's of drugs in clinical trials. This is only expected to expand with Adcetris' success so far and the expected approval soon of Roche's T-DM1 for breast cancer. See Xconomy.

Menarini Partners on Cancer ADCs for $1 Billion

Show some success in medicine and others will follow. Genentech's soon to be licensed T-DM1 for the treatment of breast cancer has spawned many other entrants pouring into the ADC field. The latest to play is Menarini.

Menarini today announced a partnering effort with Oxford BioTherapeutics on 5 new programs aimed at the development of ADC cancer therapeutics. Oxford will supply the antibody, linking technology and cancer targets.  Menarini will do the manufacturing and development work.  Both will pursue clinicals and commercialization in different parts of the world.  Oxford gets North America and Japan, while Menarini takes Europe, Asia and Latin America.

The arrangment is expected to speed Oxford's participation in clinical trials and helps bolster Menarini's pipeline.  Both should benefit if the therapies succeed. See Fierce Biotech.

Posted by Bruce Lehr Oct 29th 2012.

 

 

Lemmings? Let's Think Inside the Box Instead

Here's a post from In the Pipeline this morning.  It deals with the myriad of big deal failures where Big Pharma has spent mucho grande buckos on early stage projects only to fall over quickly in the clinic (e.g BMS purchase of Inhibitex, Abbott hook-up with Reata, etc.).

Industry watcher, Raghuram Selveraju of Aegis Capital, comments that these failures result from Big Pharma execs being a "bunch of lemmings". He says they only license products in their comfort zones where they can deploy an existing sales force to doctors they already know, or against drug targets that everyone else in the industry has identified as "hot". Okay, maybe so.

His proposed solution?  Pharma should pursue incremental projects using the FDAs 505b2 pathway, develop biosimilars, or repurpose existing drugs.  They should also focus on niche or specialty areas. Avoid primary care products with long and expensive clinical trials and large commercial operations.

The 505b2 pathway basically calls for coming up with new formulations and dosing schedules for existing drugs.  Isn't that me-tooism being carried out to the max?  Can't I find a huge number of commentators who descry that strategy as one big reason that R&D returns have slumped to all-time lows?  Success is high but risk/reward is low.  Talk about a lemming strategy -- 505b2 seems like a poster child to me.

Posted by Bruce Lehr Oct 26th 2012.

 

When Your Sales Drop 19% YOY Buy Pipeline Assets

Baron Nathan Rothschild famously told clients "buy when there is blood in the streets, even if its your own."

AZ CEO Pascal Seriot seems to have taken this to heart.  He told reporters after the company reported a huge 19% drop in its sales for the latest quarter, "One of the critical things we need to do in the mid-term is to bolster our pipeline and that will rely on business development activities, there is no question about it."

As a result, AZ squashed a plan to buyback its own stock.  In the near past, it licensed rights to Amylin's diabetes portfolio, and partnered with Ironwood on that company's drug linaclotide in China. It licensed Ardelyx's CKD drug for $272 M, bought Ardea and signed a deal with Regulus. 

Now it is rumored to be lookng to buy Amarin, and has been linked to possible purchases of Forest Laboratories and Shire. The Baron might be proud should this come to pass. See Fierce Biotech.

Posted by Bruce Lehr Oct 28th 2012.

 

 

 

SeaGen Leverages ADC Success into Big Deal with Abbott

Cha-ching! Cha-ching!

Seattle Genetics announced today that it has completed a deal with Abbott for use of its antibody drug conjugate (ADC) technology for a series of cancer applications. SeaGen will receive $25 M upfront and have the possibility of earning $220 M in milestones plus mid- to high single digit royalties for each new Abbott cancer drug.

Thus, Seattle Genetics has successfully parlayed its licensed Hodgkin's therapy, Adcetris, into another long-term money generating technology deal.  Previously, Abbott hahad only committed $8 M to SeaGen in a single 1 molecule deal in 2011. Oh, what a little clinical success can bring.  Also, Genentech's success with T-DM1 in its partnership with ImmunoGen has hurt either. 

ADCs are coming.  There are more than 15 other ADC candidates in clinical trials.  Backers of this technology include: Astellas Pharmaceuticals, Bayer, Celldex Therapeutics, Daiichi Sankyo, Genentech, GSK, Millenium/Takeda, Pfizer, and Progenics.

"We are leading the field in ADC development, and this expanded collaboration with Abbott further validates our technology and approach in targeting and treating cancer," said Natasha Hernday, SeaGen VP of corporate development. See Xconomy and Fierce Biotech.

Posted by Bruce Lehr Oct 23rd 2012.

Alnylam Cashes RNAi Check from Genzyme for $22.5 M

Cha-ching!

RNAi pioneer Alnylam announced that Genzyme will be paying it $22.5 M in upfront fees to license its phase I drug ALN-TTR02 in Asia.  The drug performed very well in studies completed in July 2012 for the treatment of transthyretin-mediated amyloidosis.  The disease effects primarily adults in the 30-40 yrs range and can damage their nerves and/or heart. 

Genzyme agreed to the upfront and a royalty that could run to the mid-teens for the TTR program.  It is an orphan disease that will fit well with the Genzyme portfolio.  It is somewhat unusual for a company to pay this much upfront for a phase I program, but the results we very good in a phase 1 trial (knocking down the disease causing TTR protein by 94% when 50% is considered therapeutically relevant) and it is an orphan disease.  A defined patient population in a growing part of the world, a very good clinical result and a prospect for quicker/cheaper clinical trials and commercialization means you cut the deal.

Alnylam's stock took off on word of the announcement.  The company plans to pursue therapies in 5 other areas with the licensing and royalty proceeds. See Fierce Biotech and Xconomy.

Posted by Bruce Lehr October 22nd 2012.

BMS and AZ Team up to Buy Amylin at Premium

This one caught me by surprise evn though it was known that Amylin was actively soliciting bids for its own acquisition.  Late Friday, Bristol Myers Squibb announced it was acquiring Amylin for $5.3 B plus paying Eli Lilly about $1.7 B in olbigations to acquire Amylin and its diabetes treatments Byetta and Bydureon. 

Then is was also announced that AstraZeneca will pay BMS $3.5 B to share in the profits of the the two drugs. The deal represented about a 10% premium over Amylin's closing price on Friday.  Some analysts were scratching their heads at the size of this deal for a company like Amylin -- that has had more than its share of trials. 

However, desperate times sometimes call for desperate measures, and there are few companies in Big Pharma land more desperate than AZ for some new products and revenue streams.  Their pipeline and R&D productivity has been characterized as the industry's worst.  At a time when key drugs are coming off patent, they need the shot in the arm so to speak and will get two diabetes drugs from the deal.

The only compnay perhaps looking at a steeper patent cliff than AZ, would be Eli Lilly. They didn't pick up any products in the deal but did get out from being owed a large debt by Amylin and now have $1.7 B more in their pockets to invest. See Xconomy, Pharmalot and PharmaGossip here and here.

Posted by Bruce Lehr Jun 30th 2012.

Biogen Idec and Isis Deal: Antisense Resurgence?

A couple days ago Biogen Idec and Isis announced they woudl be partnering on another deal to apply Isis antisense technology to type 1 myotonic dystrophy. Under the deal, Isis gets a smallish $12 M upfront payment with back loaded milestones of $259 M possible.

Isis scientists are wagering they can fight myotonic dystrophy type 1 now that they have identified a gene that contains three individual DNA bases that repeat extensively, which leads to the production of long, toxic RNA molecules that accumulate in cells and cause the muscle problems. By creating an antisense molecule, Isis and Biogen are hoping to target and get rid of the toxic RNA.  The condition affects about 150,000 patients.

“Myotonic dystrophy has an identifiable genetic cause, the program fits with our mission to bring innovative therapies to patients with serious neurologic diseases, and Isis’ antisense compound has the potential to make a real difference,” said Steve Holtzman, Biogen’s executive vice president of corporate development.

This type of genetically focused drug development program could also be a relatively quick effort.  Dire need for a new treatments in rare conditions can raise the prospect of filing for approval based on proof-of-concept studies. Rare diseases also don't require the big studies with thousands of patients needed to demonstrate safety in a large population. Any treatments for these diseases can also fetch six-figure prices. And that helps explain why a number of Big Pharma companies have been beefing up their work in the rare disease arena.

It's been awhile since antisense therapies have been getting positive press.  Hopefully this deal will work out for both companies and the affected patients. It would also be good to see the technology successfully deployed for at least some conditions. See Xconomy and Fierce Biotech.

Posted by Bruce Lehr Jun 30th 2012

 

Novartis Hops the Hep C Train

Novartis is the latest big pharma to take the hep C train looking for a chance at a multi-billion dollar payout.  It signed a pact for $440 M with Enanta Pharmaceuticals for its preclinical NS5A drug.  The deal calls for $34 M upfront and a possible milestone-based payout up to $406 M more.

The Enanta drug, EDP-239, is directed to the NS5A target that should provide effects across all three hep C genotypes and does not require the use of interferon.  Avoiding the use of interferon is seen as the goal by most of the leading contenders for the estimated $20 B plus hep C treatment market -- where an ever increasing crowd is now jockeying for position. See Fierce Biotech.

Posted by Bruce Lehr Feb 21st 2012.

Hepatitis C Deals Take Center Stage

Market analysts have projected that sales of products that are newly on the market or in late phase clinicals to treat hepatitis C could have worldwide sales in excess of $20 B by 2020. That's a big number! See Pharmalot.

So it is easy to see why more deals are happening in this area with a few more possibilities looming.  In just the past few weeks and months, Gilead bought Pharmasset for its PSI-7977 therapy for $11 B.  BMS followed suit to buy Inhibitex for its phase I hepatitis C drug for an impressive $2.5 B - a startling sum for a phase I compound that is still years from the market. Both acquiring companies are trying to introduce an oral hepatitis C treatment that does NOT rely on interferon (and its well described side-effects). See Fierce Biotech and PharmaGossip.

Now Merck is rumored to be a leading suitor to buy perhaps, Achillion for its hepatitis C treatments.  This would add to Merck's newly approved Victrellis and its mid-stage drug MK-5172 still in development. Merck also had previously announced a collaboration with Roche.

Said Merck's Roger Pomeranz at a recent JP Morgan Healthcare Conference, "Our goal is to be a leader in hepatitis C, and we will do what it takes to get there."  Merck is ready to do small or larger deals to rapidly build its position.  See Fierce Biotech.

The Game is On.

Posted by Bruce Lehr Jan 10th 2012.

ImmunoGen and Lilly Cut ADC Deal

From Fierce Biotech, ImmunoGen and Eli Lilly announced a deal for the latter to gain an exclusive license to a defined number of treatments utilizing the formers antibody drug conjugate technology.  ImmunoGen will receive $20 M in upfront payments, can earn up to $200 M in milestones and also can earn royalties when the drugs reach commercialization.

Lilly plans to exploit the ADC technology with its pipeline of oncology drugs to "develop agents with clear clinical benefit in specific patients populations."

Posted by Bruce Lehr Dec 20th 2011.

Top 10 Biotech Deal Terminations in 2011

Fierce Biotech recounts the Top 10 biotech deals with big pharma partners that were axed in 2011.  They state that the right deal can make a company and when it sours it can break it too. Pharma partners look to pull the plug ASAP on souring deals to save as much money as possible. It's a "Terminate often, terminate early" philosophy at work many times.

Analysts (passing out advice & when don't they) say under that scenario, it is critical that the biotech gets back all licensing rights without paying reverse royalties -- so they can repartner the deal!  Many deals are repartnered in just this manner. With regard to blockbusters coming from these type of deals, analysis reveals that 8% had been partnered, re[partner4d and launched to successful outcomes.

Top 10 Terminate Deals for 2011:

• GSK and Targacept (neuronal nicotine receptors)
• Shire and Renovo (Justiva for scarring)
•  Merck and Addex Pharmaceuticals (ADX63365 for schizophrenia)
• Janssen Pharmaceuticals (J&J) and Diamyd Medical (GAD65 for type I diabetes)
• Cephalon and ImmuPharma (lupus)
• Novartis and Peptimmune (PI-2301 for MS)
• Novartis and Paratek Pharmaceuticals (PTK 0796 wide spectrum antibiotic)
• Merck and Portola Pharmaceuticals (Betrixaban anticoagulant)
• Eli Lilly and Amylin (Byetta for type 2 diabetes)
• Solvay and Depomed (DM-1796 for pain)

Time to repartner up.

Posted by Bruce Lehr Dec 19th 2011.

 

 

Venture Funding Decrease is Big Pharma's Gain

From Fierce Biotech, it seems that big pharma has happily stepped into the funding void created by the collapse of venture funding for biotechs to do more deals earlier and cheaper than before.  Says Dan Zabrowski, head of Roche's drug partnership unit,  "We are doing around 50 to 60 partnership deals a year now, compared to around 30 deals per year before the crisis [of 2008]. Today, we start deals earlier with less upfront payments and share the risk with our partners."

Who says a funding crunch is so bad?  This is not exactly a hardship for big pharma.

Posted by Bruce Lehr Dec 12th 2011.

GSK Hooks Up with Alnylam on siRNA Enabled Vaccines

GSK and the RNAi-company Alnylam announced a new licensing deal where by GSK will use siRNAs from the latter to apply to its vaccine program.  The Alnylam technology involved is termed VaxiRNA.  The deal is initially focused on influenza vaccine production. Under terms of the agreement, GSK will provide research funding and certain milestone payments to Alnylam. 

Alnylam’s VaxiRNA platform applies siRNAs for the silencing of specific genes that limit or prevent efficient growth of viruses in vaccine manufacturing systems, including those in cell culture.  Alnylam says this new platform addresses the significant unmet commercial need for innovative technologies that can improve the manufacture of vaccine products, especially where vaccine production is a limiting factor for the scale and speed of global immunization needs.

The deal comes at a good time for Alnylam, which lost partnerships with Novartis and Roche earlier in the year, and is expected to report a loss of 35 cents per share for Qtr 3 in a late day earnings call. They could use the shot in the arm so to speak. See GEN and Xconomy.

 

 

Posted by Bruce Lehr Nov 1st 2011.

Zymeworks and Merck Partner on Bi-specific Antibodies

Zymeworks and Merck announced a deal whereby the former's platform technology for the development of bi-specific antibodies will be applied to cancers and autoimmune diseases.  Zymeworks will receive an upfront payment (undisclosed) and have a shot at milestones and royalties that could reach $187 million.

Bi-specific antibodies have binding sites that can recognize two different targets.  The Zymeworks platform provides the means to engineer unique antibodies against multiple targets on a single cell. The proteins can also be engineered to circulate longer in the bloodstream or to induce a stronger immune response.

Merck made a good partner for Zymeworks as it provided some proof of principal data, upfront cash and credibility to draw more investors. It also can complement Zymeworks protein engineerign knowledge with its own drug development expertise and understanding of biology.  Now they both have to make it work as a producers of therapeutics. See Xconomy and Fierce Biotech.

Posted by Bruce Lehr Aug 30th 2011.

 

BI Licenses ProBioGen’s GlymaxX Platform for Fucose-Free Antibody Production

Boehringer Ingelheim (BI) obtained a nonexclusive license to ProBioGen's GlymaxX technology for the production of afucosylated antibodies. Fucose-deficient antibodies show enhanced antibody dependent cell-mediated cytoxicity (ADCC) -- typically making them more potent against tumor cells. 

GEN | News Highlights:BI Licenses ProBioGen’s GlymaxX Platform for Fucose-Free Antibody Production.

The GlymaxX platform enables the production of new and pre-existing producer cell clones and can be engineered in less than 10 weeks.  The technology competes against BioWa's (Kyowa Hakko's) Potelligent system for the production of afucosylated antibodies.  Presumably both technologies will be competing in oncology applications.

Posted by Bruce Lehr Aug 12th 2011.

Vical and Astellas Agree on CMV Vaccine Deal

Astellas will pay Vical $130 M for rights to its cytomegalovirus (CMV) vaccine to prevent the virus' reactivation in immunosuppressed transplant patients.  A phase III trial of TransVax in hematopoietic stem cell transplant patients and a phase II study in solid organ transplant recipients will begin in 2012.

Astellas will develop and commercialize the vaccine in the US and for the rest of the world.  It will also take on all development and commercialization costs.  Vical will retain rights to co-promote in the US and provide manufacturing support. The deal extends Astellas offering in the transplant market -- a key focus area. See Fierce Biotech.

 

 

 

Posted by Bruce Lehr July 15th 2011.

 

Sanofi MS Drug (from Genzyme) Advances

Sanofi reported yesterday that it had good news from the latest phase III trial with its MS drug, Lemtrada.  Lemtrada, you will remember, was the star player in the Genzyme-Sanofi valuation discussion and the main object of the contingent value rights (CVR) ultimately  crafted to close the deal.

In the latest news from the clinic, Lemtrada was compared to Merck's Rebif in the treatment of multiple sclerosis and patients showed a 55% reduction in relapse rates over  a two-year period. Surprisingly though, the drug fell short in showing a statistically signficant reduction in disability rates.  Sanofi still plans to press ahead with filings for regulatory approval in the USA and EU in early 2012.  See Fierce Biotech.

 

 

Posted by Bruce Lehr July 12th 2011.

Amgen and Micromet Make Cancer Deal

Amgen increased its activity in cancer drug development by reaching a deal with MicroMet, valued at up to $1B, to develop drugs for up to two solid cancer targets. The upfront for the deal is $14.1 million with the rest based on performance milestones and commercial royalties.

Amgen will gain access to Micromet's BITE antibodies which are designed to recruit the patient's own soldier T cells to attack tumors. Micromet has cut previous deals with other Big Pharma, including Bayer, Boehringer Ingelheim and Sanofi.  See Fierce Biotech.

 

Posted by Bruce Lehr July 12th 2011.

BMS adds Innate Pharma as its Latest Pearl

In keeping with its "string of pearls" acquisition model, BMS added Innate Pharma to its stable with a deal valued at $465 million. As is usual these days, there was a $35 M upfront payment with milestones that could land the remaining $430 million plus a potential double-digit royalty. The deal was the largest ever for a French biotech company.

BMS acquires rights to Innate's phase I anti-cancer mAb called IPH2102. Innate will continue to develop the drug against myeloid leukemia up through phase II with BMS doing the funding. See Fierce Biotech.

 

Posted by Bruce Lehr July 7th 2011.

 

Is Pharma Dealmaking Becoming More Difficult?

Yes it is.  No it isn't.  Depends upon whom you ask and when.

In a survey of 18- business development executives considering deals from 2006 through 2010, the responses were remarkably split I thought. The majority of biotech respondents (36%) said they could drive terms with pharma (though you can see 64% thought they were on equal footing or were more takers than givers of terms).

So we turn over to pharma.  well, 44% of pharma respondents (again the majority) said their negotiating power had increased with biotechs.

Is Pharma Dealmaking Becoming More Difficult? // Pharmalot.

What about upfront payments?  Biotechs (55%) said they had dropped - though 31% reported an increase. Flip sides of the coin to pharma, and 51% saw an increase with only 32% seeing a drop.  We in the same deals?  A more objective third party analysis of the reported deals shows about a 5% decrease in the upfront value for the 2006-2010 time period.

Average deal volumes and payments seemed to be pretty steady over the period.  Any loss of leverage pharma experienced due to dwindling pipelines and perhaps some desparation to license short-term revenues seems to have been counterbalanced by a bad funding-environment for the biotechs.  Status Quo.

Posted by Bruce Lehr June 16th 2011.

 

 

Vertex Deals with Alios on Hepatitis C Extension

Vertex Pharmaceuticals, fresh off its recent FDA approval of Incivek (telaprevir) for the treatment of hepatitis C infection, announced a new deal with Alios Pharmaceuticals for up to $775 million in development milestones for two programs - ALS 2200 and ALS 2158.  By acquiring these, Vertex hopes to develop hepatitis C cocktails that will cement its leadership position in the market by removing the need to continue the use of interferon.   

ALS 2000 and ALS 2158 are both nucleotide analogs that offer a high barrier to drug resistance, can be taken orally, and may only require a once a day dosage.  Further, both have fewer side effects than interferon that often causes flu-like symptoms to the patient. Thus the combined package of Incivek and the new drugs offer the opportunity to improve the safety, efficacy and ease of administration for the patient. See Fierce Biotech.

 

Posted by Bruce Lehr June 14th 2011.

SAFC and Pfenex Partner on Protein Production

SAFC and Pfenex have agreed to a partnership to produce therapeutic proteins and vaccine components for their joint clients.  Pfenex will be responsible for engineering bacterial strains and developing production processes that can be transferred to SAFC's GMP fermentation facilities in Jerusalem ( Download Jerusalem-insert) for scale up and manufacturing.

The strategic partnership will focus on identifying customers seeking the total solution, from the design and engineering of a robust production strain, process development, scale up and GMP production. SAFC will subsidize a portion of upfront costs in return for the a commitment to use its GMP manufacturing services.  See Outsourcing Pharma.

 

Posted by Bruce Lehr June 8th 2011.

PATH and GSK Team Up on Malaria

PATH, the non-profit group working to develop vaccines for developing countries, scored again with an announced collaboration with GSK for a vaccine against Malaria. The second generatin vaccine with combine a single dose vaccine from J&J's Crucell followed by two doses of GSK's RTS,S vaccine.  This is known as a 'prime-boost' strategy. See Xconomy.

Previously I've written about PATH's success in developing a meningitis vaccine and its subsequent deployment in African populations with the funding assistance of GAVI.  Now PATH is -- dare I say it -- moving down the path to attack malaria.

 
Posted by Bruce Lehr June 7th 2011.