The biggest life sciences deal this week involves a company that doesn’t discover or develop drugs, or even sell them. Yet its mark is found on pharmaceutical products spanning the entire sector.
Royalty Pharma (NASDAQ: [[ticker:RPRX]]) acquires the royalty rights for drugs. Most of those royalties are for products that are already approved, but the company has also been striking deals for compounds still in development. The biotechs forking over royalty rights get cash right away to continue the expensive work of developing and testing new medicines. Royalty Pharma rakes in royalty cash from drug sales. The company has turned such deals into a profitable business and this week it went public, raising $2.2 billion—the biggest IPO in any sector so far this year.
Several biotechs joined Royalty Pharma in making their public debuts in a week that also saw startups emerge from stealth and new drugs win regulatory approval. Let’s recap those stories in our news roundup.
STARTUP CASH
—Startup Orca Bio emerged from stealth with a $192 million Series D round of funding and clinical trials already underway for its experimental allogeneic cell therapies made without any cell or genetic engineering.
—Watertown, MA-based C4 Therapeutics raised $170 million in venture equity and debt financing to support clinical development of its protein degradation drugs.
—Shattuck Labs closed a $118 million Series B round to continue to advance more dual-function cancer immunotherapies to clinical trials.
—Frazier Healthcare Partners-backed Lassen Therapeutics launched with $32 million in Series A financing to move ahead antibody programs it acquired from Australian biotech CSL.
—Engrail Therapeutics, a new San Diego company that aims to acquire and develop potential neuroscience drugs, emerged from stealth with $32 million from Nan Fung Life Sciences.
—Synthetic biology company Bit Bio raised $41.5 million in Series A funding to put toward creating a platform that can precisely reprogram stem cells into every human cell type.
—Emeryville, CA-based 4D Molecular Therapeutics secured $75 million Series C financing to advance three of its gene therapy candidates into the clinic this year.
—Regenerative medicine biotech Surrozen closed a $50 million Series C round of funding to reach the clinic with experimental treatments for liver disease and inflammatory bowel disease.
THIS WEEK IN BIOTECH IPOS
—The biggest IPO of the year so far belongs to Royalty Pharma (NASDAQ: [[ticker:RPRX]]). The acquirer of royalty rights to pharmaceutical products priced its IPO at $28 per share, raising $2.2 billion.
—Repare Therapeutics priced its upsized IPO at $20 per share and raised about $220 million to continue development of its synthetically lethal cancer drugs.
—Forma Therapeutics went public at $20 per share, raising $277.6 million for its pipeline of drugs for rare blood disorders and cancer.
—Progenity, a company that develops and sells molecular testing products, raised about $100 million from its IPO, priced at $15.
DRUG AND DEVICE DEVELOPMENTS
—Lurbinectedin (Zepzelca), a Jazz Pharmaceuticals (NASDAQ: [[ticker:JAZZ]]) drug for advanced small cell lung cancer, received FDA approval. Jazz licensed US commercialization rights to the drug from Madrid-based PharmaMar in December.
—The FDA granted marketing authorization to a video game that Akili Therapeutics developed to treat attention deficit hyperactivity disorder, making it the first prescription therapy that comes in the form of a video game.
—Viela Bio (NASDAQ: [[ticker:VIE]]) received its first FDA nod for inebilizumab (Uplizna), a treatment for adults with a rare autoimmune condition that primarily affects the optic nerves and spinal cord who also have a particular antibody. It’s the second drug approved for the condition.
—Epizyme (NASDAQ: [[ticker:EPZM]]) drug tazemetostat (Tazverik) won the regulatory nod for follicular lymphoma. The decision comes nearly five months after the FDA approved the drug for epithelioid sarcoma.
—The Merck (NYSE: [[ticker:MRK]]) anti-PD-1 therapy pembrolizumab (Keytruda) received accelerated FDA approval for treating solid tumor patients with “tumor mutational burden-high” cancers that can’t be surgically removed or have spread. It’s the drug’s second approval based on a biomarker rather than where in the body the tumor originated.
—Ultragenyx Pharmaceutical (NASDAQ: [[ticker:RARE]]) drug burosumab (Crysvita) was awarded FDA approval for treating tumor-induced osteomalacia, a rare disorder that causes low phosphate levels and bone softening. The drug was initially approved in 2018 for X-linked hypophosphatemia.
—Avalglucosidase alfa, an investigational Sanofi (NYSE: [[ticker:SNY]]) enzyme replacement therapy for Pompe disease, met the goals of a pivotal study. The France-based drug giant plans to submit the drug for FDA review in the second half of this year.
—San Mateo, CA-based Sagimet Biosciences said preliminary data showed that its oral, once-daily investigational treatment for nonalcoholic steatohepatitis, or NASH, met the main goal of a Phase 2 trial of significantly reducing liver fat.
LET’S MAKE A DEAL
—GlaxoSmithKline (NYSE: [[ticker:GSK]]) is committing $120 million to Ideaya Biosciences (NASDAQ: [[ticker:IDYA]]) and three of its preclinical cancer programs that use an approach called synthetic lethality. Ideaya also disclosed it’s working in another hot area of cancer research called targeted protein degradation.
—AbbVie (NYSE: [[ticker:ABBV]]) agreed to pay $60 million up front to start an R&D partnership on a Phase 2-ready lupus drug from Alpine Immune Sciences (NASDAQ: [[ticker:ALPN]]).
—Funds managed by Blackstone (NYSE: [[ticker:BX]]) are investing $337 million in medical device giant Medtronic (NYSE: [[ticker:MDT]]) to support development of new diabetes management technologies.
—Neurocrine Biosciences (NASDAQ: [[ticker:NBIX]]) and Takeda Pharmaceutical (NYSE: [[ticker:TAK]]) announced a strategic collaboration for compounds in Takeda’s early-to-mid-stage psychiatry pipeline. Neurocrine paid Takeda $120 million up front and could be responsible for paying nearly $2 billion more based on developmental and commercial milestones.
—Privately held Ocuphire Pharma, a Farmington Hills, MI-based clinical-stage ophthalmic biotech, and Rexahn Pharmaceuticals (NASDAQ: [[ticker:REXN]]) agreed to combine in a reverse merger. When the deal closes, Ocuphire plans to list under the stock symbol “OCUP” and advance its investigational drugs for eye disorders.
—Assembly Biosciences (NASDAQ: [[ticker:ASMB]]) is regaining rights to early-stage gut microbiome programs that had been partnered with Allergan. AbbVie (NYSE: [[ticker:ABBV]]), which completed its acquisition of Allergan last month, decided to end those programs.
COVID-19 R&D
—The FDA revoked the emergency authorization that permitted antimalarial drugs hydroxychloroquine and chloroquine to be used for treating COVID-19. The agency cited a lack of evidence of efficacy based on its review of data.
—An Oxford University clinical trial found that dexamethasone, a widely used anti-inflammatory drug, showed “clear benefit” in helping hospitalized patients recover from COVID-19 disease. The BBC has more.
—The German government agreed to make a €300 million (about $336 million) investment in CureVac, representing a 23 percent stake in the Berlin-based biotech. CureVac will use the funds to support development of its messenger RNA COVID-19 vaccine, which this week received regulatory authorization to begin Phase 1 testing.
—Investment firm RA Capital purchased about $200 million worth of stock in Novavax (NASDAQ: [[ticker:NVAX]]), raising proceeds the Maryland company will apply toward its COVID-19 vaccine development efforts.
—French drugs giant Sanofi committed to spending €610 million (about $683 million) in its home country to boost the firm’s vaccines research and production capacities, including the creation of a new industrial site and R&D center dedicated to vaccines.
TRIALS & TRIBULATIONS
—A judge ruled that a key patent for blockbuster Biogen (NASDAQ: [[ticker:BIIB]]) multiple sclerosis drug dimethyl fumarate (Tecfidera) is invalid, clearing the way for generic competition from Mylan (NASDAQ: [[ticker:MYL]]). Biopharmadive has more.
—Proteus Digital Health, a startup that developed a “digital pill” that monitors whether patients were take their medications, filed for Chapter 11 bankruptcy protection.
PEOPLE ON THE MOVE
Pacific Biosciences (NASDAQ: [[ticker:PACB]]) CEO Michael Hunkapiller and Chief Financial Officer Susan Barnes are retiring… Moderna (NASDAQ: [[ticker:MRNA]]) appointed Ray Jordan as chief corporate affairs officer… Örn Almarsson joined Lyndra Therapeutics as chief technology officer… Aridis Pharmaceuticals (NASDAQ: [[ticker:ARDS]]) appointed Hasan Jafri its chief medical officer… Christopher Dinsmore joined Kronos Bio as chief scientific officer… Sensei Biotherapeutics appointed Marie-Louise Fjällskog its chief medical officer… Jim Malone joined Bigfoot Biomedical as chief medical officer… Frank Sanders was appointed president of Zealand Pharma US… Macrogenics (NASDAQ: [[ticker:MGNX]]) named Stephen Eck its chief medical officer… Clinton Musil was named chief financial officer of Catalyst Biosciences (NASDAQ: [[ticker:CBIO]])… Abcentra appointed Kevin B. Bacon its CEO… Filip Dubovsky joined Novavax as senior vice president and chief medical officer… Ambaw Bellete was appointed chief operating officer of FerGene… and David Spellman is joining Akebia Therapeutics as senior vice president, chief financial officer, and treasurer.
Sarah de Crescenzo contributed to this report.
Image: iStock/michaelquirk
