Amid a world that has been brought to its knees by the COVID-19 pandemic, the biopharma industry has learned how to quickly adapt under these extreme circumstances. Not only has it rapidly brought to bear huge research efforts to uncover potential therapeutics and vaccines to counter the circulating coronavirus, but it has learned how to conduct its business activities in a completely different way. For example, the pandemic hasn't stopped biopharmas from going public, with 15 companies graduating to the public arena in June alone. Those financings have contributed to the $62 billion that has been generated in combined global public and private company financings in the first half of the year, just $6 billion shy of the current full-year record for financings established in 2015.
Deal values rise with 15 above $1B in 2020’s second quarter
Despite the SARS-CoV-2 pandemic, biopharma dealmaking values in the second quarter of 2020 increased by 22.4% since the first quarter, and M&A values – thanks to Abbvie Inc. completing in May its $63 billion buyout of Allergan plc – are at a four-year high. A total of 529 deals, including licensings, collaborations and joint ventures, reported during the second quarter had projected values of nearly $49 billion, a step up from the 471 deals and $40.8 billion value of the first quarter. In comparing 2020 to each of the previous three years, the second quarter has had the highest volume and value for any of the past 14 quarters.
Pharma firms commit $1B to develop antibiotics for resistant bacteria
Twenty-three pharma companies are joining forces in the AMR Action Fund and have raised $1 billion in new money for the clinical development of antibiotic drugs addressing the most resistant bacteria. Working with philanthropic backers, the fund aims to bring two to four new antibiotics through to approval by 2030. The AMR Action Fund, an initiative of the International Federation of Pharmaceutical Manufacturers and Associations, based in Geneva, launched July 9 at simultaneous events in the U.S. and Europe.
The failure of an experimental refractory chronic cough drug to yield statistically significant reductions in placebo-adjusted cough frequency sent shares of its developer, Bellus Health Inc. (NASDAQ:BLU), down 71.7% to $3.40 on July 7. Nonetheless, Bellus President and CEO Roberto Bellini said the study showed a "clear path forward" for the drug, BLU-5937, in people with high cough counts, setting the stage for an adaptive phase IIb trial focused on those patients to begin in the fourth quarter.
Cellectis SA said the FDA has placed a clinical hold on a phase I study of UCART-CS1A, an allogenic CAR T-cell therapy it has been testing in patients with relapsed or refractory multiple myeloma, after one person enrolled in the study died from a case of treatment-emergent cardiac arrest.
Idorsia Ltd. plans to file an NDA before the year-end for its insomnia drug, daridorexant, following a readout of top-line data from a second phase III study, which the company said closely tracked an earlier phase III study, although it failed to meet one of two primary endpoints with statistical significance. The present study, dubbed ‘302, tested once-daily 10-mg and 25-mg doses of daridorexant, a dual orexin receptor antagonist. It works by blocking the interaction of two neuropeptide hormones, orexin A and orexin B, which normally promote wakefulness by interacting with the widely distributed orexin receptors.
Obseva SA’s top-line data from pivotal phase III studies showed that Primrose 1 scored statistically significant and clinically meaningful results across primary and key secondary endpoints at week 24, while Primrose 2 turned up sustained efficacy and continued safety at week 52 in women with heavy menstrual bleeding due to uterine fibroids (UFs). Investors may have hoped for an improvement in bone mineral density parameters with Primrose 1 as compared to Primrose 2; data from the latter experiment were disclosed last December.
Viiv Healthcare Ltd. won FDA approval for Rukobia (fostemsavir), a gp120-directed attachment inhibitor for the treatment of adults with multidrug-resistant HIV-1 infection failing their current antiretroviral regimen due to resistance, intolerance or safety considerations. The drug was reviewed under FDA's fast track and breakthrough therapy status programs.
AGC Biologics A/S said it is partnering with Molecular Partners AG to develop MP-0420, a multispecific Darpin anti-COVID-19 program. Ardigen SA and COVID-19 Vaccine Corp. have formed a research collaboration to develop a SARS-CoV-2 vaccine. Ardigen will apply its neoantigen prediction platform, Ardimmune Vax, which uses bioinformatics and artificial intelligence, to select viral epitopes that are the most suitable to boost cellular immune response. Bharat Biotech International Ltd. has successfully developed India’s first indigenous vaccine candidate for COVID-19 to enter human trials. Named Covaxin, the vaccine has been cleared by the Drug Controller General of India and Ministry of Health & Family Welfare for phase I and II trials after the company submitted positive preclinical study results regarding safety and immune response. Bioxcel Therapeutics Inc. has initiated an expanded access program at Massachusetts General Hospital to provide its alpha 2A adrenoceptor agonist, BXCL-501, a sublingual thin-film formulation of dexmedetomidine, to individuals diagnosed with COVID-19 who are critically ill in the intensive care unit and may require calming or arousable sedation. Corvus Pharmaceuticals Inc.’s success in treating a COVID-19 patient previously diagnosed with non-small-cell lung cancer (NSCLC) with CPI-006 helped boost shares (NASDAQ:CRVS) to $4.96, up $2.21, or 181%, last week as the company disclosed the start of a phase I study to investigate the anti-CD73 immunotherapy prospect. Emergent Biosolutions Inc. signed a five-year manufacturing services agreement with Janssen Pharmaceuticals Inc. for large-scale drug substance manufacturing for Johnson & Johnson’s investigational SARS-CoV-2 vaccine, Ad26.COV2-S, recombinant. Fusion Antibodies plc, an antibody discovery, engineering and supply company, has started proof-of-concept work on its Mammalian Antibody Library Discovery platform and hit its first milestone in the COVID-19-associated project, with the synthesis of the antibody library DNA. Medivir AB entered a research collaboration with the Drug Discovery and Development Platform (DDD) at Scilifelab on potential inhibitors of SARS-CoV-2. Through the collaboration, DDD will get access to Medivir's protease-targeted compound library. Moderna Inc. and Laboratorios Farmacéuticos Rovi SA, are collaborating on the large-scale, commercial fill-finish manufacturing of mRNA-1273, Moderna’s mRNA vaccine candidate against COVID-19. Novavax Inc. and Regeneron Pharmaceuticals Inc. will receive Operation Warp Speed funding to develop and deliver a COVID-19 vaccine in 2021. Novavax gets $1.6 billion with Regeneron receiving $450 million for a large-scale COVID-19-related manufacturing demonstration project in the U.S.
Missing the primary endpoint along with key secondary endpoints in a phase III trial of Kevzara (sarilumab), an interleukin-6 (IL-6) receptor antibody, for treating COVID-19 patients who need mechanical ventilation caused Regeneron Pharmaceuticals Inc. and Sanofi SA to halt the study. Regeneron then followed the closing by initiating two late-stage studies, a phase III and a phase II/III, to evaluate REGN-CoV2, a double antibody cocktail for treating and preventing COVID-19.
Deals of the week
Dragonfly Therapeutics Inc. and Bristol Myers Squibb Co. (BMS) will collaborate to discover and develop immunotherapies for multiple sclerosis and neuro-inflammation targets. Dragonfly will grant BMS the option to license exclusive worldwide intellectual property rights to multiple candidates developed using Dragonfly's platform for multiple new targets. BMS will pay Dragonfly $55 million up front, and Dragonfly will be eligible to receive additional payments associated with development, regulatory and sales milestones, as well as potential royalties on sales of approved products.
Foghorn Therapeutics Inc. signed a collaboration deal with Merck & Co. Inc. to discover and develop therapeutics targeting the chromatin regulatory system in oncology that could eventually bring in as much as $425 million. Foghorn receives an up-front payment and research milestones and is eligible to receive development, regulatory and commercial milestones that could total upward of $425 million. Foghorn also gets the royalties on sales of any approved products the collaboration produces. Merck gets exclusive global rights to develop and commercialize drugs targeting dysregulation of a single transcription factor.
Mission Therapeutics Ltd. has signed a discovery deal with Pfizer Inc. around its small-molecule protein degradation platform and raised $15 million as an extension to its series C, with Pfizer Ventures leading the round.
Numab Therapeutics AG and Boehringer Ingelheim GmbH have entered a research collaboration and worldwide licensing agreement that will start with two projects aiming at novel therapies for difficult-to-treat lung and gastrointestinal cancers and patients with geographic atrophy, a progressive, irreversible retinal disease that occurs in patients with age-related macular degeneration for which there is no current treatment.
Sanofi SA is tapping Kymera Therapeutics Inc. to advance two new protein degrader programs, one of which will target IRAK4 in patients with immune-inflammatory diseases and another for an undisclosed target. Each program could yield multiple therapies. Kymera will receive $150 million up front and is eligible for more than $2 billion in potential milestones plus royalties. It also has an option to participate equally in U.S. cost- and profit-sharing.
Takeda Pharmaceutical Co. Ltd. and Twist Bioscience Corp. have established a partnership where Takeda will gain access to proprietary phage display libraries for the discovery, validation and optimization of antibodies in its pipeline of biologics for oncology, rare diseases, neuroscience and gastroenterology.
Public offerings: 89bio Inc. priced its public offering of about 2.6 million shares at $27.50 per share, grossing the company approximately $72.9 million. Acceleron Pharma Inc. closed its public offering grossing approximately $492.5 million. Aditx Therapeutics Inc. closed its IPO of 1.22 million units at $9 each. Akero Therapeutics Inc. raised $188.2 million from its public offering. Ascendis Pharma A/S priced its public offering of American depositary shares, grossing the company approximately $569.2 million. Inozyme Pharma Inc. filed to conduct an $86 million IPO. Its lead product candidate, INZ-701, is a soluble, recombinant fusion protein that is designed to correct a defect in the mineralization pathway caused by the enzyme ectonucleotide pyrophosphatase/phosphodiesterase 1 and ABCC6 deficiencies. Allovir Inc. filed for an IPO of up to $100 million, including potential overallotments, to fund expenses for planned phase II and III trials of lead candidate, Viralym-M, a multivirus-specific T-cell therapy targeting five viruses. Inventiva SA set terms for its U.S. IPO, planning to raise $102 million by offering 7.5 million American depositary shares at $13.68 apiece. Nkarta Inc. plans to raise up to $150 million from an IPO of 10 million shares priced in the range of $14 to $16. It is developing engineered natural killer cell therapies to treat cancer. Nurix Therapeutics Inc. filed to raise up to $100 million in an IPO. Otonomy Inc. priced a $60.1 million underwritten public offering. Paxmedica Inc. filed to raise up to $17 million in an IPO. Poseida Therapeutics Inc. upsized its proposed IPO, moving to offer 14 million shares priced at $16 each for total gross proceeds of $224 million to fund ongoing development of its pipeline. Relay Therapeutics Inc. set terms for an IPO on Nasdaq, where it has applied to list 14.7 million shares under the symbol RLAY. The offering would raise about $250 million at the midpoint of its proposed offering range of between $16 and $18 each. Revolution Medicines Inc. priced an underwritten public offering for anticipated gross proceeds of $156 million. Sun Biopharma Inc. filed to raise up to $12 million in an IPO. Therapeutics Acquisition Corp. generated $118 million from its IPO. Vir Biotechnology Inc. priced its public offering to raise approximately $300 million.
Venture funding: Forbion has made the first close of €185 million (US$208 million) for a new growth opportunities fund, which will be dedicated to late-stage investments in companies with mature assets. Gesynta Pharma AB raised SEK190 million (US$20.6 million) in new funding to move GS-248, a selective inhibitor of microsomal prostaglandin E synthase-1 (mPGES-1), into a phase IIa trial in systemic sclerosis. Harbour Biomed Therapeutics Ltd. completed its series C financing of $102.8 million to accelerate development of its growing portfolio of next-generation biologics targeting cancer, immunologic diseases and COVID-19. Tranquis Therapeutics Inc. raised $30 million in series A financing. Varmx BV closed a €32 million (US$36.1 million) series B round. Velosbio Inc., which is developing cancer therapies targeting ROR1, has raised $137 million in series B financing to support development of its lead antibody-drug conjugate, VLS-101, and continued expansion of its pipeline. Vor Biopharma LLC raised $110 million in a series B financing to advance its lead candidate, CD33 modulator VOR-33, into clinical trials.
The U.S. House Appropriations Committee said its budget proposal for the Department of Health and Human Services includes $24.4 billion in emergency spending, and $47 billion for the NIH, an increase of $5.5 billion over the enacted level for the current fiscal year. The allocation for the NIH would include $5 billion to improve capacity at the NIH’s institutions and $240 million for research into a universal flu vaccine. The $8 billion directed toward the CDC is more than $230 million above the enacted level for fiscal 2020, but the CDC would also receive a $9 billion emergency supplemental that would enable the agency to make preparations for public health emergencies.
The Institute for Clinical and Economic Review posted a draft scoping document outlining its planned review of the comparative clinical effectiveness and value of treatments for high cholesterol in the setting of heterozygous familial hypercholesterolemia or secondary prevention of atherosclerotic cardiovascular disease. The therapies include inclisiran (Novartis AG), bempedoic acid (Nexletol, Esperion Therapeutics Inc.) and bempedoic acid/ezetimibe (Nexlizet, Esperion).
Word on the Street: Industry responses to the issues of the week
"Significant advances over the past few decades have dramatically improved HIV treatment and for many, HIV is considered a manageable life-long condition. However, heavily treatment-experienced (HTE) adults, which account for approximately 6% of adults living with HIV who are on treatment, have little to no options left due to resistance, tolerability or safety considerations."
Viiv Healthcare Ltd., commenting on the FDA approval for Rukobia (fostemsavir), a gp120-directed attachment inhibitor for the treatment of adults with multidrug-resistant HIV-1 infection failing their current antiretroviral regimen due to resistance, intolerance or safety considerations
“Zoom is the de facto way of business these days. There were no meaningful disruptions as a consequence of the pandemic. We had in-person meetings until things shut down in late February and early March, but they continued effectively on Zoom.”
Adrian Gottschalk, CEO, of Foghorn Therapeutics Inc., which signed a collaboration deal with Merck & Co. Inc. to discover and develop therapeutics targeting the chromatin regulatory system in oncology that could eventually bring in as much as $425 million
“Unlike COVID-19, AMR is a predictable and preventable crisis. We must act together to rebuild the pipeline and ensure that the most promising and innovative antibiotics make it from the lab to patients.”
Thomas Cueni, director general of the International Federation of Pharmaceutical Manufacturers and Associations, on the $1 billion AMR Action Fund for the clinical development of antibiotic drugs addressing the most resistant bacteria