Pharma megadeals once again took center stage this week as more giant divisions were flipped, and the tension around a potential 12-figure, international buyout affecting thousands of workers across the globe escalated even higher. Those stories, and—oh yeah, biotech news—below.
—Nothing is more closely watched in the life sciences world right now than the ongoing Pfizer/AstraZeneca saga, and for good reason. First, tensions are rising: Pfizer (NYSE: [[ticker:PFE]]) publicly boosted its bid to an astronomical $106 billion this week, and AstraZeneca (NYSE: [[ticker:AZN]]) responded with a presentation detailing why it’s worth way more than that. But also, there are a host of implications should that deal go down, starting with the thousands of workers that would likely lose their jobs, and then the massive portfolio review that will take place—impacting biotechs everywhere. With those issues in mind, I spoke with Francois Nader, the president and CEO of Bedminster, NJ-based NPS Pharmaceuticals (NASDAQ: [[ticker:NPSP]]) and a veteran of several pharma mergers, about the ins and outs of such deals from an employee perspective, an executive perspective, and that of the nervous biotech looking on. (Separately, NPS lowered its 2014 financial projections for sales of teduglutide (Gattex) to $100 million-$110 million from $110 million-$120 million, sending shares down more than 9 percent.)
—Boston-based Rhythm Pharmaceuticals has been trying to replace a decades old, yet flawed treatment for diabetic gastroparesis—a debilitating, digestion-related complication suffered by people with diabetes. While there are still hurdles ahead, the company took a step towards that goal this week when its drug prospect, relamorelin, hit its goal in a Phase 2 clinical trial. Rhythm, a startup backed by the likes of MPM Capital, Third Rock Ventures, and others, plans to move the drug into its next study—likely a pivotal trial—by the end of the year. I spoke with Rhythm CEO Keith Gottesdiener and president Bart Henderson about the trial, and what comes next.
—Tarrytown, NY-based Regeneron Pharmaceuticals (NASDAQ: [[ticker:REGN]]) is looking to gene therapy to produce a potential successor to its blockbuster drug aflibercept (Eylea). The company cut a deal this week with Menlo Park, CA-based startup Avalanche Biotechnologies to co-develop and commercialize gene therapy products for eye diseases, among them potentially the “wet” form of age-related macular degeneration—the disorder aflibercept treats. Avalanche—which just raised a $55 million Series B round in late April—got an unspecified cash payment up front and stands to add another $640 million down the road if the prospects to come out of the tie-up hit various milestones. All told, the deal covers eight therapeutic targets. Regeneron will get worldwide rights to all of the collaboration drugs that move forward, though Avalanche has an option to share the costs and profits of products aimed at two therapeutic targets of its choice. Regeneron also has a time-limited window to negotiate for rights to Avalanche’s wet AMD gene therapy prospect, AVA-101, after it finishes an ongoing Phase 2a study. Separately, Regeneron reported its first quarter earnings. Aflibercept generated $359 million in revenue, missing analysts’ consensus estimates by about $20 million.
—Loxo Oncology was formed in New York last year by Aisling, subsequently picked up a preclinical cancer drug from Array BioPharma (NASDAQ: [[ticker:ARRY]]), and then raised $33 million to help develop it. This week, the biotech, now based in Stamford, CT, fattened up its wallet a bit more, announcing a $24 million Series B round led by New Enterprise Associates. Existing investors Aisling and OrbiMed Advisors also participated in the funding. Sara Nayeem, a principal at NEA and the former vice president of molecular discovery at Epizyme (NASDAQ: [[ticker:EPZM]]), has joined Loxo’s board. The company’s lead drug, known as LOXO-1, is now in Phase 1 testing.
—The shuffling of Big Pharma divisions continued this week, as Whitehouse Station, NJ-based Merck (NYSE: [[ticker:MRK]]) sold its consumer care business—which includes brands like Dr. Scholl’s, Afrin, and Coppertone—to Bayer for about $14.2 billion. Merck also agreed to pay Bayer up to $2.1 billion as part of a separate deal to co-develop drugs for cardiovascular diseases. In addition, Merck appeared to leapfrog Bristol-Myers Squibb for the lead in the high-stakes cancer immunotherapy race: it filed an application with the FDA to approve MK-3475, its checkpoint inhibitor for cancer. Bristol-Myers has yet to do so with its rival drug, nivolumab.
—Shares of Cambridge, MA-based Aegerion Pharmaceuticals (NASDAQ: [[ticker:AEGR]]) got slammed this week after sales of the company’s rare disease drug lomitapide (Juxtapid) came in well short of analysts’ expectations. Lomitapide generated $27 million in sales in the fourth quarter of 2013, compared with consensus estimates of around $33.6 million. Aegerion also cut its projected 2014 sales for the drug by about $10 million, to $180 million-$200 million for the year, blaming delays on orders for the drug in Brazil. Shares slid more than 22 percent on the news, continuing a precipitous fall for Aegerion during the first year of its drug’s launch. Shares were worth more than $88 apiece in July. They now trade at about $33 per share.
—Natick, MA-based Boston Scientific (NYSE: [[ticker:BSX]]) made its latest acquisition this week, snapping up Cupertino, CA-based IoGyn. Boston Scientific already held a roughly 28 percent stake in the privately-held company, and is paying about $65 million to buy the rest of IoGyn and retire about $8 million worth of note debt it issued to the startup. IoGyn has developed and won FDA clearance of a minimally invasive system surgeons can use to remove intrauterine polyps and fibroids.
—Watertown, MA-based Enanta Pharmaceuticals (NASDAQ: [[ticker:ENTA]]) landed another $20 million check from AbbVie (NYSE: [[ticker:ABBV]]) this week after the larger company filed an application with regulators in Europe to approve an all-oral regimen for hepatitis C including ABT-450, a drug the two companies co-developed. Enanta got a $20 million payout a couple weeks ago when AbbVie lodged an application with the FDA.
—Retiring Biogen Idec (NASDAQ: [[ticker:BIIB]]) chairman William Young has joined the board of directors of Vertex Pharmaceuticals (NASDAQ: [[ticker:VRTX]]). Young announced plans to retire as Biogen’s chairman in February. He spent about four years in the role. Young is also the chairman of NanoString Technologies (NASDAQ: [[ticker:NSTG]]) and a venture partner at Clarus Ventures.
