The share prices of blue-chip biopharmaceutical companies closed out the month on a high note to contribute to their stellar collective performance during the second quarter, with the BioWorld Biopharmaceutical index increasing almost 20%. Small- and mid-cap biopharma companies also enjoyed a strong period fueled by positive clinical trial data and new drug approvals. Although the Biopharmaceutical index closed out the month relatively flat, significant expectations that the sector will eventually provide a therapeutic solution, or solutions, to the COVID-19 pandemic was the catalyst for growth during the first two months of the second quarter. In addition, U.S. investors maintained a bullish outlook for the country’s economic restart that helped drive the general markets. As a result, the Dow Jones Industrial Average gained about 18% in the quarter, a performance that has helped erase a good portion of the bellwether index’s dramatic meltdown earlier in the year.

Product development

Heron Therapeutics Inc. disclosed a second complete response letter (CRL) for HTX-011 in postoperative pain. The CRL, received from the FDA on June 26, the anticipated PDUFA date, stated the agency was unable to approve the NDA in its present form and called for additional nonclinical information. None of the four nonclinical issues identified in the letter relate to observed toxicity or represent “significant barriers to ultimate approval,” according to the company.

Ultragenyx Pharmaceutical Inc.’s NDA for triheptanoin (UX-007) won FDA approval. Branded Dojolvi, the highly purified, synthetic, seven-carbon fatty acid triglyceride was cleared for use in treating pediatric and adult patients with molecularly confirmed long-chain fatty acid oxidation disorders (LC-FAOD), a group of rare and life-threatening genetic disorders in which the body is unable to convert long-chain fatty acids into energy. It’s the first approved therapy for LC-FAOD, which can affect patients from early in life to as late as adolescence or adulthood, causing acute crises of energy metabolism and severe energy deficiency.

Zynerba Pharmaceuticals Inc.’s stock was slashed almost in half last week as the company’s pivotal Connect-FX study for treating fragile X syndrome behavioral symptoms failed to achieve statistical significance in its primary and three key secondary endpoints. The study did, however, achieve statistical significance in the primary endpoint of improvement at 12 weeks in treating patients in the social avoidance subscale measurement, a finding heartening enough to prompt Zynerba to say it plans to meet with the FDA to find a regulatory path forward for Zygel, the pharmaceutical-grade cannabidiol transdermal gel.

COVID-19 developments

Research focused on finding viable solutions to counter the COVID-19 pandemic continues at an explosive pace, with a total of 588 potential therapeutics and vaccines at the forefront of scientific efforts launched by industry, academia and government. The number of options now in the pipeline are a 36% increase above what was seen only a month ago. Likewise, global deaths due to the circulating coronavirus have risen by 37% since June 1, according to the World Health Organization. Global confirmed cases, by contrast, have jumped 70% in the last month.

Gilead Sciences Inc. announced its no-bargaining price for remdesivir for all governments of developed countries where the drug is approved or authorized as a treatment for COVID-19. At $390 per vial, the government price will add up to $2,340 per five-day treatment course, which is expected to be the common treatment regimen. Given the complex U.S. pricing system that requires a discount for government programs, the list price will be higher – $3,120 per five-day course, or $520 per vial – for commercial payers in the U.S. The Foster City, Calif.-based company said it would provide assistance as needed to ensure patients have access to the drug, which is the first antiviral to demonstrate patient improvement in COVID-19 trials.

Scientists investigating the impact of SARS-CoV-19 on protein expression in human cells have shown that infected cells develop virus-laden membrane protrusions, or filopodia, which may explain the rapidity of viral spread through the body. They suggest SARS-CoV-2 hijacks casein kinase II (CK2), which plays a key role in cytoskeleton formation, cell growth and proliferation, co-opting it into creating the tentacle-like protrusions.

Multiple sessions at the American Association for Cancer Research Virtual Annual Meeting II covered how COVID-19 is affecting cancer patients, from how clinical trials need to be modified during the pandemic to how real-world evidence can play a role now and in the future.

Aligos Therapeutics Inc. entered a collaboration and license agreement with KU Leuven, in particular its Centre for Drug Design and Discovery, a drug discovery unit and investment mechanism of KU Leuven, and the Rega Institute for Medical Research, to develop a coronavirus protease inhibitor as a potential therapeutic candidate to address the COVID-19 pandemic. Biontech SE announced positive preliminary data from the ongoing phase I/II trial of one of the four COVID-19 vaccines it is developing with Pfizer Inc., with participants in each of three dose groups mounting immune responses that were greater than those seen in patients who recovered from COVID-19 infections. The two companies said they are on track to begin a phase IIb/III study involving up to 30,000 healthy volunteers before the end of July, and if successful, expect to manufacture 100 million doses by the end of 2020 and potentially more than 1.2 billion doses by the end of 2021. Dr. Reddy's Laboratories Ltd. partnered with Fujifilm Holdings Corp. and Global Response Aid, an alliance focused on improving supply chains, for the development, manufacture and sales of Avigan (favipiravir) tablets, a potential treatment of COVID-19. Eisai Co. Ltd. will join REMAP-COVID, a substudy of REMAP-CAP (A Randomized, Embedded, Multifactorial, Adaptive Platform trial for Community-Acquired Pneumonia) that tests multiple interventions for treating hospitalized COVID-19 patients. Eritoran, an investigational TLR4 antagonist discovered and developed by Eisai, has been selected as the first investigational immune modulation therapy to be evaluated in the moderate patient group of REMAP-COVID. Eli Lilly and Co. and Sanford Burnham Prebys Medical Discovery Institute inked a research agreement to characterize Lilly’s next-generation anti-SARS-CoV-2 antibodies. Those studies aim to build on Lilly’s current portfolio of neutralizing antibodies by exploring novel cocktails, half-life extension technologies and strategies to further enhance potency. Hoth Therapeutics Inc. entered a sponsored research agreement with Virginia Commonwealth University for a COVID-19 treatment. The collaboration is designed to develop and optimize peptide biomimetics to achieve high binding rates of peptide to the RBD of SARS-CoV-2 spike protein at the nanomolar level with demonstrated negligible toxicity through combined computational and experimental efforts. Immunoprecise Antibodies Ltd. identified numerous lead candidate antibodies with highly potent neutralizing activity in vitro, which are being manufactured for further testing and possible inclusion in the company's Polytope monoclonal antibody therapy to combat the COVID-19 pandemic. The company is preparing to test those lead antibodies against additional, documented, mutated strains of the virus. Preclinical studies are set to start this summer. Merck & Co. Inc. and Ridgeback Biotherapeutics LP will develop EIDD-2801, an orally bioavailable form of a ribonucleoside analogue that inhibits replication of multiple RNA viruses, including SARS-CoV-2 for treating COVID-19 patients. Revolution Medicine Inc. licensed to Ginkgo Bioworks Inc. IP to develop WDB-002, a natural compound the companies said may be a useful starting point for a potentially new antiviral against SARS-CoV-2.

Deals of the week

Alexion Pharmaceuticals Inc. completed the acquisition of Portola Pharmaceuticals Inc., which adds Andexxa (coagulation factor Xa [recombinant], inactivated-zhzo), marketed as Ondexxya in Europe, to Alexion’s commercial portfolio. Carmine Therapeutics Inc. said that Takeda Pharmaceutical Co. Ltd. has engaged it in a research collaboration aimed at the discovery, development and commercialization of new nonviral gene therapies for two rare disease targets. Terms of the deal included an up-front payment of undisclosed value for Carmine, plus research funding, and more than $900 million in potential milestone payments. Tiered royalties would be paid on potential marketed products. Takeda will also provide Carmine with a $5 million convertible loan to support development of its red blood cell extracellular vesicles platform, called Regent. Celsius Therapeutics Inc. signed three collaboration agreements with the University of Oxford, Cleveland Clinic and the LMU University Hospital Munich. In each deal, Celsius will partner with leading academic scientists to access patient tissue samples and apply its single-cell genomics platform and machine learning capabilities to discover insights into inflammatory bowel disease. Quralis Corp. will in-license preclinical compounds with disease-modifying potential in amyotrophic lateral sclerosis by preventing disease-induced neuronal excitotoxicity from Eli Lilly and Co.

Financial transactions

Public offerings: Acceleron Pharma Inc. priced an underwritten public offering for gross proceeds of $450 million. Aditx Therapeutics Inc., which is developing technologies specifically focused on improving the health of the immune system through immune reprogramming and monitoring, said it priced its IPO of 1.22 million units at $9 each. Akouos Inc. closed its IPO for gross proceeds of $244.4 million. Alx Oncology Inc. has filed to raise up to $100 million in an IPO. Antibe Therapeutics Inc. closed a public offering for gross proceeds of CA$28.75 million (US$21.12 million). Berkeley Lights Inc. has filed to raise up to $100 million in an IPO. Chiasma Inc. priced its underwritten public offering with gross proceeds expected to be $70 million. Crispr Therapeutics AG priced an underwritten public offering for gross proceeds of approximately $450 million. DFP Healthcare Acquisitions, a blank check company formed by Deerfield Management targeting the health care industry, plans to raise up to $200 million from an IPO. Editas Medicine Inc. closed its underwritten offering for gross proceeds of approximately $215.6 million. Immunotech Biopharm Ltd. said it intends to raise up to HK$1.1 billion (US$141.9 million) on the Hong Kong Stock Exchange on July 10, with shares priced between HK$10.5 and HK$11 apiece. Kiromic Biopharma Inc. has established terms to raise up $25 million in an IPO and will sell 1.9 million shares at a price range of $12 to $14. Magenta Therapeutics Inc. closed an underwritten public offering with gross proceeds expected to be $69 million. Nantkwest Inc. closed an underwritten public offering, which raised gross proceeds of about $90.7 million. Panacea Acquisition, a blank check company formed by Ecor1 Capital targeting the biotechnology industry, has priced its IPO and raised $125 million. Pandion Therapeutics Inc. has filed to raise up to $75 million from an IPO. Soleno Therapeutics Inc. closed its underwritten public offering for net proceeds of approximately $53.7 million. Tela Bio Inc. closed its public offering for gross proceeds of $48 million.

Other public offerings: Biontech SE said a private investment of $250 million (€223 million) has been made by Temasek and other accredited investors.

Venture funding: Amylyx Pharmaceuticals Inc. closed an oversubscribed $30 million series B financing. Bolt Biotherapeutics Inc. raised $93.5 million from a series C round. Annexon Inc. closed a $100 million financing. CF Pharmtech Inc. raised $50 million in series F financing. Denovo Biopharma LLC closed a series C funding round for ¥590 million (US$83.5 million). Gene therapy developer Freeline Therapeutics Ltd. added $80 million in new investment to take its series C round to $120 million in total. Goldfinch Bio Inc. closed an oversubscribed series B financing, which raised $100 million.

Regulatory news

Biosimilars referencing Amgen Inc.’s rheumatoid arthritis drug, Enbrel (etanercept), could remain sidelined in the U.S. for nearly another decade, following a Federal Circuit decision affirming the validity of two patents protecting etanercept and its manufacturing methods. After losing its appeal, Sandoz Inc., the generics and biosimilars arm of Novartis AG, said it’s evaluating its options, which may include an appeal to the U.S. Supreme Court. Absent a Supreme Court win or a licensing deal, Sandoz’s etanercept biosimilar, Erelzi, may not be able to launch in the U.S. until at least 2028.

The FDA issued a draft guidance on developing anti-infective drugs for children. Besides providing general recommendations on the pediatric development of the drugs, the draft discusses the timing of initiation of pediatric trials, enrollment strategies, extrapolation of efficacy and other considerations. Comments on the draft should be submitted to Docket No. FDA-2020-D-1518 by Sept. 29, 2020.

The U.S. Federal Trade Commission and the Department of Justice (DOJ) issued new vertical merger guidelines Tuesday outlining how they evaluate the likely competitive impact of vertical mergers and whether mergers comply with U.S. antitrust law. The guidelines detail the techniques and types of evidence the agencies typically use to predict whether a vertical merger may substantially lessen competition. The document is the first major revision to guidance on vertical mergers since DoJ’s 1984 nonhorizontal merger guidelines, which were withdrawn in January.

Word on the Street: Industry responses to the issues of the week

“The distinct visualization of extensive branching of the filopodia once again [illustrates] how understanding the biology of virus-host interactions can illuminate possible points of intervention.”
Nevan Krogan, director of the Quantitative Biosciences Institute at UC San Francisco, who led research that found that 40 of the 332 human proteins that interact with 27 SARS-CoV-2 viral proteins exhibit significantly differentiated phosphorylation as a result. At the same time, 49 human kinases out of a total of 518, were either up- or down-regulated

"These are not deaths that are going to be counted as directly due to the virus, but in a certain way, they are. And we have to do everything we possibly can, now that things are starting to open up, to catch up and make sure that those folks who have waited don't keep on waiting any longer."
Francis Collins, director of the NIH, noted at the American Association for Cancer Research Virtual Annual Meeting II that we'll be living with the effects of the pandemic for some time since it has caused a steep drop in cancer diagnoses as people stopped going in for screening and diagnoses

"If successful, it could offer the potential of extending our gene therapy treatments to DMD and LGMD patients who would otherwise have been denied access due to pre-existing antibodies."
Doug Ingram, president and CEO, Sarepta Therapeutics Inc., which has licensed Sweden-based Hansa Biopharma AB’s lead asset, imlifidase, to enable gene therapies to treat muscular dystrophy patients harboring neutralizing antibodies to the adeno-associated virus (AAV) vectors. Hansa’s technology has shown the ability to clear the IgG antibodies that prevent dosing AAV-based gene therapies

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