Biotechs have been parading into the public markets at a record-setting pace over the past few years, particularly in Boston. But one local startup decided against independence at the last minute this week, choosing M&A, and a definitive payout for its shareholders, instead. We’ve got that story and plenty more in a packed week on the East Coast.
—Giant pharmaceutical companies have spent billions trying to crack Alzheimer’s disease, only to come up with a litany of clinical failures. The task is even taller for small biotech startups, but Tufts University professor Philip Haydon is taking it on anyway. This past week, his Boston-based startup GliaCure began the first clinical trial for its lead drug candidate, GC021109, which homes in on a target often overlooked in drug development: microglial cells, one of the family of cells that provide the “glue” to hold the brain’s neurons together. I spoke with Haydon, who has raised $8.5 million from angel investors, about the daunting road ahead.
—Chelsea, MA-based Civitas Therapeutics was all lined up for an IPO: it raised a big round of funding from some crossover investors, and set the range for an imminent offering. Then, Ardsley, NY-based Acorda Therapeutics (NASDAQ: [[ticker:ACOR]]) came along and offered $525 million to buy it out, and the IPO plan was history (at the mid-point of its projected range, Civitas would’ve had a market cap of $403 million, according to Renaissance Capital). Civitas is a spinout of Alkermes (NASDAQ: [[ticker:ALKS]]) based on drug delivery technology Alkermes originally developed for an inhalable insulin. The company used that technology to develop an inhalable form of the commonly used Parkinson’s treatment levodopa, which is now on the verge of Phase 3 testing. Acorda will now take on that development task, and the old Alkermes tech. Alkermes, meanwhile, was still a Civitas shareholder—it’ll pocket about $60 million from the deal, according to regulatory filings.
—The FDA this past week cleared Lexington, MA-based T2 Biosystems (NASDAQ: [[ticker:TTOO]]) to begin selling its first products: the T2Dx (a diagnostic instrument) and the T2Candida (a test that runs on the device that detects Candida infection, which can lead to sepsis). Those approvals mean T2 is about to make the transition to a commercial-stage company, and get the chance to prove its thesis: that its supposedly quicker method of testing patients for dangerous viral and bacterial infections can save the healthcare system a lot of money. I spoke with CEO John McDonough about the challenges of getting hospital customers to buy in.
—It’s been an up and down year for Cambridge, MA-based Merrimack Pharmaceuticals (NASDAQ: [[ticker:MACK]]). Just a few months ago, for instance, it lost Sanofi as a partner for a cancer drug prospect called MM-121. But the company was back on the upswing this past week after Baxter International (NYSE: [[ticker:BAX]]) agreed to grab non-U.S. rights to Merrimack’s pancreatic cancer drug, MM-398, in a deal that could be worth as much as $970 million. Merrimack is getting $100 million up front, with the rest of the cash tied to various development, regulatory, and commercial milestones. Merrimack is preparing an FDA application for MM-398, which produced a modest, but statistically significant benefit for pancreatic cancer patients in a Phase 3 trial earlier this year.
—Basking Ridge, NJ-based Regado Biosciences’s (NASDAQ: [[ticker:RGDO]]) risky plan to run a pricey Phase 3 study without Big Pharma blew up in late August, and now the company’s employees are paying the price. Regado said it is axing 60 percent of its workforce, or 20 people, after it was forced to shut down the late-study of its anticoagulant, REG1 (Revolyxis Kit). Regado terminated the trial because of “severe allergic adverse events” in patients dosed with its drug during angioplasties. It’s unclear where Regado will go from here—the company is exploring “potential business alternatives” and hired advisory firms MTS Health Partners and Cowen and Co. to help figure out its next move. Regado went public just a year ago.
—Bristol-Myers Squibb announced plans to open a new 650,000 square-foot facility in Lawrenceville, NJ, and staff it with about 2,500 people. Bristol will use the facility to consolidate other existing operations in nearby Plainship and West Windsor. Bristol’s worldwide headquarters is already in Lawrenceville and employs about 2,000 people at that campus.
—Gene therapy has undergone a renaissance over the past few years, and now it appears Cambridge, MA-based Biogen Idec (NASDAQ: [[ticker:BIIB]]) is buying in to its prospects. Biogen has hired hired Olivier Danos as its senior vice president of gene therapy. He’ll be heading a research group devoted to uncovering new technologies for gene transfer and genome engineering, and report to R&D chief Doug Williams. Danos was most recently employed at Kadmon, where he helped assemble a gene therapy program and associated technology platform. He is also led a gene therapy research tem at Paris’s Necker Hospital – Enfants Malades and a gene therapy consortium at the University College London.
—Speaking of Kadmon, CNBC’s Meg Tirrell reported this past week that its CEO, Sam Waksal, is planning an IPO for the New York-based startup by the end of the year. Waksal founded ImClone Systems, which developed the cancer drug cetuximab (Erbitux) and was bought by Eli Lilly for $6.5 billion. He was also jailed for insider trading and served five years in prison. That sentence has left Waksal barred from being an officer or director of a publicly-traded company, which is why, he told CNBC, his brother Harlan would be named president and CEO. Kadmon made the news official a day later, turning over the reins to Kadmon to his brother. Waksal is now Kadmon’s “chief of innovation, science and strategy.” The release stated that Kadmon is “continuing to explore” its options, including an IPO, but that “no specific timelines have been set.”
—The FDA has cleared Summit, NJ-based Celgene (NASDAQ: [[ticker:CELG]]) to begin selling apremilast (Otezla) as a treatment for patients with moderate to severe plaque psoriasis. It’s the second FDA nod for apremilast, which was first approved back in March for psoriatic arthritis.
