How do you tell a good Pharma acquisition from a bad one?

Mergers and acquisitions are commonplace in the pharmaceutical industry, there are reports of it every other week. Pfizer for example, has just recently announced  it will acquire Medivation for 14 billion dollars, a move that will bolster its presence in the immuno-oncology field. And here’s a list of other notable acquisitions over the past few years involving Amgen, Gilead, Celgene, Bristol-Myers and Merck. Acquisitions in pharma have been occurring so much that this graphic from revenuesandprofits.com depicts the consolidation of 60 pharmas into just 10 over the past two decades:

Why do pharma companies like merging and acquiring so much? They do it mainly for the following reasons:

• To improve their own performance
• To consolidate resources and reduce wastage
• To accelerate their product’s access to the market
• To obtain or increase access to a specific market
• To acquire a new technology
• To pick an early “winner” or to buy cheap
• To eliminate competition

So back to the Pfizer-Medivation example. By buying Medivation, Pfizer gets access to the blockbuster anti-prostrate cancer drug, Xtandi, which brings in $2.2 billion/year. Furthermore, there is still potential for Xtandi to be used in other cancers, with projected sales of $4.78 billion in 2020. Pfizer would also gain access to other cancer drugs in Medivation’s pipeline, like promising breast cancer drug talozoparib, increasing its overall access to the cancer market. It all seems like a very logical move.

So the only thing that could make it a bad move, is if they are paying more than they would ever get back. Pfizer is constantly criticized for paying more than it should and its happening again now. Pfizer paid $81.50 per share of Medivation, a 180% premium on Medivation’s share price when talk of the deal first started, and a 55% premium over Sanofi’s offer of $52.50 per share. So yes, they are paying alot. But if Xtandi and Medivation’s other drugs outperform and outsell, then we can all look back and think it was a bargain! So I’ve tricked you, you can’t really tell if an acquisition is good or bad unless you’re the Oracle.

Alright, don’t be mad. There are some key things to take note of that could be warning signs an M&A is going to go wrong:

• It happens for the wrong reasons. E.g. Driven by the fear that one has to be big to survive, or driven by glory – a whole lot of people including lawyers and accountants stand to gain big bonuses when they mediate a M&A.
• The company is too focused on cost-cutting and integrating the new acquisition, neglecting the running of its day-to-day business.
• Culture clashes. Here are some examples.

But overall, how have pharma acquisitions performed in the past? Surely Pfizer having bought numerous companies before in the past, would be an expert in cleverly acquiring new companies. Well yes, on paper, they’ve got it down pat. In fact, the whole pharma industry in general, perform uniquely when it comes to mergers and acquisitions, increasing shareholder return by an average of 5% according to a McKinsey report.

Note that this is shareholder return. Not patient return, or research return. Its no secret that lots of people lose their jobs when pharmas merge, and research cuts are always made as managers try to consolidate overlaps. As a result, science tends to slow down. In the long run as well, competition drops and innovation declines. The drop in innovation may be mitigated by the consistent rise of biotech start-ups, pumping the industry with new ideas. But with the high failure rate of start-ups, how efficient can this process be?

Another option to maintain innovation and a fair amount of competition, is for large pharmas to start spin-offs themselves, which is already happening. Pfizer spun off its animal health unit Zoetis in one of the biggest IPOs in 2013. Abbot also spun off its pharmaceutical unit, now called AbbVie which has surged to become even more valuable than Abbot itself. Pharmas are even starting to swap asset classes, which may be good for science overall – imagine if we all focused on doing what we are good at.

So it looks like M&As (good and bad) are here to stay in pharma, and in fact, may even be key to the renewal and exchange of ideas.

 

 

Clinical trials – getting it right

Astrazeneca reported a failure in Phase III clinical trials for their non-small cell lung carcinoma (NSCLC) candidate Selumetinib, which was being tested for its use in combination with docetaxel. This comes in the wake of a prior failed PIII trial of  selumetinib with dacarbazine for metastatic uveal melanoma (a form of eye cancer). Given each PIII clinical trial is estimated to cost 30-40 million USD, which makes up 60% of all clinical trial costs, that is an incredible amount of money to be investing on something with a chance of coming to naught.

Just how many of these trials are failing you ask? From the FDA website, PI trials have a success rate of 70%, PII trial success is reportedly lower at 33% and the success rate of a PIII trial ranged from 25-30%.

What are the reasons for failure? There are worryingly too many but I list a key few here:

• A mouse is not a little man. Its a problem scientists face all the time, poor translation from animal models to humans. Numerous drugs have worked in mice but failed disastrously when put in humans.
• Heterogeneity of disease. NSCLC is a great example. It is actually made up of ten different mutation-specific diseases so patients tend to have rather varying disease etiologies making them harder to treat with the same approach. The PIII success rate for NSCLC is just 26.1%!
• Poor trial design. Designing a trial is not a walk in the park. Choosing the right patients to test, randomizing treatments, blinding treatment, getting the dose right, having good end-points and surrogate measures are all factors that can severely affect trial  outcome. See Dr Richard Chin’s blogpost for a good overview.
• False discovery rate. Performing a large number of measures on a small number of patients (oftentimes the case in PII trials) has a tendency to increase the number of false positives. E.g. If 10 tests are performed per patient in a trial with 100 patients (i.e 1000 measurements), there will be 50 positive results that are actually false (if a significance level of 0.05 is used). The FDR is a correction measure proposed by Benjamini and Hochberg (1995) – it looks only at significant results and calculates the proportion of false positives within this (see here and here for more info). Though it reduces the level of false positives overall, it still lets in a small proportion of false positives which may increase when using too many or inappropriate measures. This of course may create the impression that a drug appears to be working when it is not (which is later found out in the more highly-powered PIII trial)
• Risky re-positioning. The success rate of drugs in trials for diseases which they were not designed to treat, i.e non-lead/secondary indications, are often lower (about 1.5-3X less likelihood of approvals). This is often due to institutional bias where less time and effort go into monitoring patient selection or establishment of scientific rationale.

These problems are not easy to solve but at least the last 3 points are immediately addressable.

To counter poor trial design , adaptive clinical trial design is now gaining popularity as it allows for modification of the treatment regime/dose and patient selection/sample size based on observing the results as they come out. They also allow early trial terminations when the drug is seen to be futile, which could save lots of money. However, there is an inertia to adopt this due to logistic/operation concerns, so only an estimated 20% of clinical trials are following adaptive design, but hopefully this grows.

To reduce the FDR, we should adopt more stringent significance criteria, e.g. a p value < 0.001. It also helps to look at what the multiple measures are telling you as a whole, rather than singling out one which gives a statistically significant result. Testing a hypothesis that is very unlikely to be true tends to increase the number of false positives, so it is advised not to include this in your battery of tests. Benjamini has also now come out with a new weighted FDR approach, that assigns importance to the measured endpoints which enforces better control on the overall error rate.

Finally, the repositioning of drugs for non-lead or secondary indications is something pharma has to closely regulate. Though it makes sense to use drugs that have cleared all the initial safety hurdles and have well-established pharmacokinetics, how suited it is to treat another disease should be properly established. Costly, failed clinical trials are known to bankrupt biotechs and set pharmas well-behind in the development of other drugs that would otherwise have created significant impact in the lives of patients. That said, there have been several cases of successful repositioning  – thalidomide previously a sedative is now used for pain/inflammation in leprosy, dapoxetine an anti-depressant apparently also works for premature ejaculation. There are a growing number of biotechs focussed solely on repositioning, with several targeted strategies. This presents a new market niche altogether which might improve the great waste we currently see in drug development.

 

Biogen – an uncertain future

It’s not easy being a pharma. Biogen knows this well. Founded in 1978 in Geneva by a group of prominent scientists which include Nobel prize winners, Walter Gilbert and Philip Sharp, Biogen’s history has been filled with various ups and downs.

Currently, it’s not doing so hot for the following reasons:

• Sales of its oral multiple sclerosis (MS) drug Tecfidera that used to draw in large revenues in 2014 have plateaued. Up to 4 cases of PML (progressive multifocal leukoencephalopathy), a rare and serious brain infection caused by a virus, have been reported with its use which probably explains why patients are not snapping it up.
• Its other MS drugs (Avonex and Tysabri) have declining sales as other safer and better treatments are available.
• It’s new drug opicinumab for multiple sclerosis (MS) failed a Phase 2 study in June, though they are not quite giving up on it yet.
• It’s sold off its hemophilia drug business which used to provide pretty decent revenues.
• It’s banking on a risky Alzheimer’s drug, currently in clinical trials, whose results have been mixed.
• It’s closed down a manufacturing plant in Cambridge, and is reducing its workforce by 11% or possibly more.

And now its CEO, George Scangos will be stepping down. Investors are keen to see what’s next for Biogen which will likely involve some M&A.

 

Bioshots

Your bioshots for the week:

1. WAVE Life Sciences: FDA approves orphan drug designation for its lead candidate against Huntington’s disease

WAVE produces stereopure nucleic acid drugs (antisense oligos, ASOs) which reportedly improves their pharmacology. ASOs are commonly modified with phosphorothioate that improves their stability in vivo but this also introduces a new chiral center. CEO Paul Bolno (former Head of Neuroscience/Asia Business Development at GSK) states that an oligo with 20 nucleic acids has 19 chiral centers, providing a massive number of permutations that often result in varying pharmaceutical properties.

WAVE’s lead candidate called WVE-120101 targets rs362307, a Single Nucleotide Polymorphism (SNP) associated with the mutant huntingtin (HTT) gene, enabling a selective therapy that would not affect normal HTT protein levels. A competitor, Ionis Pharmaceuticals (formerly known as Isis Pharmaceuticals), has another antisense RNA oligo therapy currently in PI/PIIa clinical trial in collaboration with Roche, but this candidate targets both wildtype and mutant forms of HTT.

2. CRISPR-editing enters human trials

Scientists at University of Pennsylvania have been granted approval from the Recombinant DNA Advisory Committee (RAC) at the U.S. National Institutes of Health to perform the first human clinical trial using CRISPR-modified T cells. And Tech mogul, Sean Parker, will be funding the trial with his newly set up $250 million Parker Institute for Cancer Immunotherapy fund. Three mutations will be introduced on two genes in patient-harvested T cells, two to give cells an effective receptor that recognizes a protein (NY-ESO-1) only expressed on cancer cells. Another against PD-1, which cancer cells use to hide from immune surveillance. The same team had recently done a study looking at whether CRISPR would affect off-target genes, and their findings appeared to be sufficiently assuring. STAT news highlighted several concerns with the trial, including the monetary incentives that researchers are under, which historically have led to more successful trial results often related to researcher bias. Approval from the FDA still has to be obtained before the trial can proceed.

3. Non-coding RNAs, not so non-coding

Scientists have found many micropeptides are translated from non-coding RNAs (see here for a previous post on ncRNAs). These micropeptides were previously overlooked as algorithms were configured to find open reading frames (ORFs) only longer than 300 bases (100 amino acids), in order to filter out the numerous shorter ORFs that do not code for proteins. Techniques such as ribosomal footprinting and next generation sequencing however have enabled the detection of these micropeptides which can then be evaluated for biologically relevant functions. Several have already been found to play important roles in immunogenecity, embryonic development and muscle contractility.

4. Brexit – Impact on Science

Chaos strikes the world as the UK referendum voting results called for UK to leave the European Union. This does not bode well for research in UK as the EU funds a large proportion of research in the form of research grants or PhD/Post-doc fellowships. From 2007-2013, EU funding support in the UK was approximately $9.8 billion as opposed to $6 billion granted by the UK government.  London-based European Medicines Agency (EMA)—the EU version of the US Food and Drug Administration (FDA)—will likely also relocate as a result of Brexit. See here for a list of quotes from prominent figures and their views on Brexit and impact on biotech/research.

5. Amgen and UCB Pharma report positive PIII results of osteoporosis drug, romosozumab

At Endocrine Society’s annual meeting in Boston, Amgen/UCB released results from their P3 trials of romosozumab, a humanized monocloal antibody that inhibits sclerostin, increasing osteoblast activity and bone building. The study found improvement in hip bone mass density over 12 months compared to placebo and was accompanied by lower incidence of clinical fractures in post-menopausal women with osteoporosis.

6. Women’s contraceptive choices over the years and other informative graphics

It appears IUD’s are making a comeback along with implants and patches. Women are also giving birth later (no surprise) and interestingly no new antibiotics have been discovered ever since 1984!

7. China’s research boost

It appears China’s anti-misconduct campaign is working as number of misconduct allegations fall. The National Natural Science Foundation of China (NSFC) is working hard to raise the bar on quality and have come up with a plan from 2016-2020 that includes establishing a deep underground Earth-physics lab near Sichuan to detect dark matter, and launching 24 scientific satellites over the next 5 years.

Bioshots

Your bioshots for the week:

1. Roche invests in bromodomain (BET) inhibitors

Roche announced it is acquiring Cambridge, Massachusetts’s based Tensha Therapeutics for US$535 million. Their  interest lies in the company’s lead compound, TEN-010, a small-molecule inhibitor selective for the bromodomain and extra-terminal domain (BET) protein family. Bromodomains are said to be “epigenetic readers” that monitor histone acetylation/methylation marks, binding to them and regulating transcriptional activity.

There are already drugs like Xanax which inhibit BET (though weakly) on the market. But several other more potent BET inhibitors have conferred protection in various cancer preclinical models, regulating oncogene MYC transcription and other cancer-related genes such as Bcl2 and NFkappaB. There is significant interest in this class of molecules as GSK, Merck, Bristol-Myers-Squibb, AbbVie, Gilead and Daichii Sankyo all have their own BET inhibitors in clinical trials.

2. Exosome Diagnostics launches the first exosome RNA-based liquid biopsy

Exosomes are microvesicles released from cells which contain DNA, RNA and protein resembling the molecular milieu of the parent cell. They are found in most bodily fluids and have the ability also to enter cells and change their biology. Exosome Diagnostics was founded by Johan Skog, who during his work at Boston-based Massachusetts General Hospital, found exosomes could enhance tumor growth by transporting mRNA, miRNA and angiogenic proteins, and could potentially serve as blood-based diagnostic markers (Nat. Cell Biol. 10, 1470–1476, 2008). Their newly launched ExoDx Lung(ALK) test characterizes both exosomal RNA and ctDNA, detecting  mutations in EML4-ALK, an oncogenic fusion protein transcript found in patients with non-small cell lung cancer (NSCLC).

3. Wuxi Apptech acquires Crelux

Munich Martinsried-based Crelux has been acquired by Shanghai-based Wuxi AppTec. Crelux provides structural-based drug discovery solutions with expertise in in silico, biochemistry and X-ray crystallography techniques which Wuxi AppTec will benefit from. In turn, Wuxi AppTec hopes to extend its European presence and cater better to its European clients. See press release here.

4. GSK CEO Andrew Witty steps down

After intense pressure by investors, Sir Andrew Witty has announced he will be stepping down in March 2017. Sliding sales figures from a combination of factors including patent expiration, poor executive decisions to sell its oncology business to focus on lower risk products, and rampant bad press from China bribery scandals have made Dr Witty’s time at GSK an especially tumultuous one. The lookout for potential candidates has started, with CFO Simon Dingemans being an option but investors are insisting on external candidates to present a fresh perspective. Novartis’ pharma chief, David Epstein, being a potential choice.

5. Chinese scientists genetically modify human embryos, again

Scientists from the Guangzhou Medical University have used the CRISPR/Cas9 system to genetically modify human embryos. The 26 embryos used in the study came from 213 fertilized eggs obtained from a fertility clinic. These embryos were classified as “unsuitable” for clinical use due to an extra set of chromosomes. Mutations were targeted towards immune cell gene CCR5, in the hope to regulate resistance to HIV. However, only 4 out of 26 of the embryos were successfully edited with several showing off-target gene mutations. This study comes after a previous study also performed in China Guangzhou, which triggered the world-wide debate on ethical concerns regarding human gene editing. An international scientific summit in December 2015 however concluded that although implantation of gene-edited embryos cannot be done in women to induce pregnancy, basic research in this area should continue. U.K. officials have also approved an embryo-editing study seeking to understand early human development.

6. Sean Parker invests $250 million on cancer immunotherapy 

Co-founder of Napster and Facebook’s first President Sean Parker launched a US$250 million grant, creating Parker Institute for Cancer Immunotherapy, an institute that will bring together more than 300 researchers from 40 laboratories across six cancer centers. This article by Sharan Begley breaks down his decision into 5 questions. Cancer immuotherapy has already received tremendous research funding support – $100 million was given by former New York City Mayor Michael Bloomberg and clothing magnate Sidney Kimmel. Biotech billionaire Patrick Soon-Shiong and Joe Biden have also both launched their individual cancer “moonshot” plans, both highly funded and involving massive collaboration between numerous institutes.

7. Pfizer and Allergan call off merger 

After months of negotiation, a new temporary ruling by the U.S. Department of Treasury on April 4 which made the tax-incentive derived from the merger no longer as lucrative as it would have been, has led Pfizer to cancel its plans to acquire Ireland-based Allergan. Pfizer may now look to split up its business into smaller units while Allergan, disappointed with the deal fall-through, obtains a $400 million break fee. See the Pfizer press release and interview with Allergan CEO on CNBC expressing frustration with the move made by the US government.

 

Sensitive detection of ctDNA

The business of liquid biopsy is gaining momentum as more companies strive to offer services to characterize mutations found in cell-free circulating tumour DNA (ctDNA). ctDNA are small DNA fragments that are released from dying tumour cells or present in exosomes (secretory vesicles) found circulating in the bloodstream and other bodily fluids such as urine or saliva. Using ctDNA, one can characterize certain gene-specific mutations that have a tremendous impact on treatment response, dictating personalized therapy. Monitoring mutation rates in ctDNA also serves as a potential biomarker to correlate with tumour load that can change in response to treatment. Obtaining blood is less invasive than performing tumour biopsies and the market for so-called liquid biopsies is estimated to exceed $10 billion as it can be applied to many different cancer types.

Some challenges remaining however is the sensitivity and robust detection of ctDNAs since they make up <1% of circulating DNA found in blood. Some of the currently available methods are described:

1. Digital PCR

Digital PCR is a new form of PCR that does not require reference standards. It does this by splitting up PCR reactions into several thousands of units, some of which do not contain the transcript of interest. By counting the number of positive PCR reactions, it allows for direct quantitation of the number of transcripts to begin with. The high partition rate  provides more data points leading to greater sensitivity and accuracy. Bio-Rad’s droplet digital PCR has its individual PCR units present in tiny water droplets within an oil emulsion and was successfully used to track tumour load by detecting BRAF mutations found in ctDNA.

2. Competitive allele-specific PCR (CastPCR)

CastPCR works by using mutation-specific primers to amplify only mutated alleles. At the same time, blocking primers are also used to block amplification of wildtype alleles. It works based on Taq polymerase ability to recognize mismatches at the 3′ end of the primer, proceeding with amplification only if the sequence is fully matched. Sensitivity of this detection method however is reportedley lower than digital PCR or BEAMing.

3. BEAMing

The BEAM in BEAMing stands for beads, emulsion, amplification and magnetics and relies on just those components for detecting low mutation rates. Basically both wildtype and mutation-carrying alleles are amplified by PCR, following which they are exposed to magnetic beads coated with gene-specific primers. These primers bind to the amplified DNA and get extended. The beads are then magnetically separated with the attached sequences and subject to fluorescent probes that discriminate between wildtype or mutant sequences. These are then monitored and quantified by flow cytometry. Sounds complicated but gives similar sensitivities to digital PCR.

4. PNA clamp PCR

Similar to CastPCR, PNA is a synthetically modified DNA that binds with stronger affinity to DNA due to its lack of phosphates. They therefore bind only perfectly matched sequences and are not recognized by polymerases hence cannot be amplified. PNA therefore acts as a clamp, preventing wildtype alleles from being amplified.

5. High resolution melting analysis

HRM relies on the binding of DNA dyes to double stranded DNA and giving off fluorescence which is significantly diminished when DNA is single-stranded. The binding of the dye would therefore vary as DNA strands separate at their melting temperatures. This fluorescence therefore acts as a readout to DNA melting properties which is determined by the length, GC content and sequence, and would differ  when a mutation is present.

6. Next generation sequencing

This is probably the more costly option but does not restrict one to known mutations.

As the field grows, one can expect larger trials using these detection methods. However small trials already demonstrate the utility of ctDNA more as biomarkers than for early cancer detection. FDA approval is currently only limited to measuring circulating tumour cells using CellSearch Technology by Jannsen Pharmaceuticals, however this has given different results to analysing ctDNA, with some patients having ctDNA not necessarily having detectable CTCs. More work is also needed to delineate just how and why these ctDNAs are released and how representative they are of actual cancer status. But this is not stopping the vast investment in the field with even Illumina getting into the mix.

Bioshots

Interesting articles from around the world for your reading pleasure:

1. Illumina’s plans on world domination

Illumina is extending its monopoly in the DNA sequencing field by suing several of its competitors including Oxford Nanopore Technologies. The latter developed an intriguing way of sequencing DNA by measuring current fluctuations as the bases (with no limit on read length) are guided through the pore by an enzyme (watch the video here). However Illumina claims ONT infringed on two exclusively licensed patents from the University of Washington with regard to the use of Mycobacterium smegmatis porinA (MspA). Illumina has also been teaming up with several diagnostic/personal consumer companies in an effort extend its genetic sequencing and interpretation capabilities to a much larger market of general consumers as opposed to research groups.

2. 3D-print your own lab equipment

It’s an interesting idea and with large potential considering how expensive lab equipment is. Furthermore the idea of everything being open-sourced allows for greater modification and improvement by the world-wide scientific community. There are currently available 3D printing designs for micropipettes, thermocyclers, centrifuges, microscopes (including two-photon), hotplates, stirrers, micromanipulators, syringe pumps and more!

3. The history of PCR

GEN did a nice article on the history of PCR and how the idea was first rejected by 15 journals!

4. Singapore’s S$19 billion five-year research budget

Singapore’s putting in a whole lot of money into developing its life science, energy, manufacturing and digital technology fields. Be interesting to see how things develop after 5-10 years!

5. Another failed Alzheimer’s drug may get a second chance

Alzheon’s drug tramiprosate which failed Phase III trials previously may get another chance after Alzheon’s re-examination of the trial data revealed significantly better responses in Apo E4 homozygous patients.

6. FDA approves genetically modified mosquitoes to halt the spread of Zika virus

Interesting article highlighting the approach to use genetically modified male Aedes Aegypti mosquitoes to mate with females producing offspring that die early. The mosquitoes are said to have limited hazardous effects to the environment as the males do not bite other animals and only survive for two days. A pilot trial in a city in San Paulo, Brazil, already proved this method was effective at reducing the Aedes aegypti population by 82%. If found effective, I bet the chances of this being applied to the control of dengue would be pretty high.

7. Finally for some stunning images

Some cool sciency images of subjects captured under the microscope in the Nikon Small World Photomicrography Competition.

 

 

Bioshot News

Some weekly industry news updates:

New Gilead CEO John Milligan takes over from John Martin 

• Both men joined at the same time in 1990. John Milligan became COO in 2007 then President in 2008.
• Takeover comes at a crucial time as Gilead is facing increasing pressure in the Hepatitis C field from competitors Merck and AbbVie.
• Rumor has it they might be scouting for a new acquisition.

Theranos’ Wellness center based in Walgreens at Palo Alto closed

• Theranos received a warning letter from the US Centers for Medicare and Medicaid Services which stated that testing at the center posed “immediate jeopardy to patient safety”. The letter gives Theranos 10 days to provide “acceptable evidence of correction”.
• Walgreens has informed Theranos that all samples collected in their stores must only be sent to Theranos’ certified lab in Pheonix.
• Their Disruptive technology has been called into question over the last few months as previous employees report that their minute blood sampling technology has only been applied to a small percentage of patients.
• Theranos also still has yet to publish details of their technology, inciting skepticism and criticism from the scientific community.

Zika virus outbreak

• A worldwide alert was issued by the Pan American Health Organization (PAHO) as an infection was reported in Brazil during May 2015 (speculation that it was triggered by the massive traveler influx during the World Cup).
• Transmitted by the Aedes mosquito, 80% of infected people do not display symptoms, other 20% show symptoms such as fever, rashes, joint pain, and conjunctivitis. Consequences for pregnant women are more severe, resulting in poor outcomes and babies born with abnormally small heads i.e microecephaly.
• No cure or vaccine for now. People are currently being advised to cover their arms and use insect repellent or to avoid travel to infected areas.

Pfizer-Allergan partners with Astrazeneca to develop a new antibiotic with the help of the U.S. government

• Biomedical Advanced Research and Development Authority (BARDA), part of the US Department of Health, is offering $50 million for drug discovery with a potential $170 million over five years in a plan to build a portfolio of drug candidates for the treatment of illnesses caused by bioterrorism agents and antibiotic-resistant infections.
• Pharmas often claim making antibiotics are not cost-effective due to low returns on investment. However the threat of microbial resistance has seen global governments trying to seek new ways to work with pharma to increase antibiotic development.

New sweat monitoring technology

• Published in Nature, the device monitors glucose, sodium, lactate and potassium levels in sweat emitted on the skin’s surface.

Eisai acquires Liaoning TianYi Biological Pharmaceutical Co Ltd

• Japanese pharma Eisai, aims to tap into China’s pharmaceutical market valued at US$109.3 billion – generics said to make up 80%.

Takeda teams up with universities to develop clinical applications of induced pluripotent stem cells (iPS). 

• Takeda will provide collaborative funding of 20 billion yen (~US$166 million), and jointly run multiple projects led by researchers invited from The Center for iPS Cell Research and Application (CiRA) at Kyoto University and other universities.

US-based Accorda buys Finnish Biotie for 321 million

• The deal serves to boost Accorda’s neurodegenerative disease pipeline as Biotie’s adenosine 2a receptor inhibitor is already in PIII for Parkinson’s disease.

Treeway won orphan drug status for its investigational drug for ALS

• Started by two ALS patients Bernard Muller and Robbert Jan Stuit.
• Orphan drug status for TW001 allows for reduced clinical trial costs, a $2M waiver in fees for NDA submission and seven year market exclusivity.
• ALS only has one approved drug – Riluzole (Sanofi)
• Biogen’s recent ALS candidate drug dexpramipexole crashed out during PIII.

Dementia Discovery Fund

• $100 million has already been raised for a new fund set up to invest in drugs for dementia.
• The fund gains monetary and scientific support from the UK Department of Health, Alzheimer’s research UK (charity) and major global pharmas including Biogen, Pfizer, Eli Lily, Takeda and J&J.
• Headed by SV Life Sciences, a VC with established track record of investing in Life Science companies since the 1980s.

Start your day with Bio Shots

Sorry for the long hiatus. Been travelling quite a bit and as you can see have not mustered up enough self-discipline to keep this blog regularly updated! However to make up for it, here is a list of some relevant biotech news from around the world collated here for your reading interest:

US 

Pfizer-Allergan merger: Pfizer has merged with Dublin-based, Allergan, the makers of Botox. The resulting company is valued at US$160 billion, forming the biggest pharma in world. The deal was primarily driven by Pfizer looking to escape paying US taxes (rated at 25% vs 15% in Ireland). The US government will likely impose laws to prevent such ginormous tax inversions from occurring in future despite Pfizer’s CEO, Ian Read’s argument that the high taxes are depleting funds that could be channeled into research and development of new drugs.

Roche’s anti-CD20 antibody outperforms in multiple sclerosis PIII trial: Roche is likely to seek FDA approval in the new year for their anti-CD20 antibody, ocrelizumab,  after its stellar performance in phase III trials for multiple sclerosis. CD20 is expressed on mature B cells and the trial demonstrates their role in the pathophysiology of autoimmune conditions such as MS, previously thought to be primarily driven by T helper cells. Current treatment for MS include other immunosuppressants such as IFN-beta drugs (Rebif,Merck), alpha4beta1 integrin inhibitor (Tysabri) and CD52 inhibitor (Lemtrada). Ocrelizumab significantly outperformed Rebif, reducing relapse rate by 47% and lesion formation by > 90%, putting it in good stead as a first line treatment for MS.

Martin Shkreli finally arrested: It’s all over the headlines, the bad boy of Pharma who bought a drug against toxoplasmosis and raised its price by 5000%, creating a hoo-hah in the US  has been arrested for fraud from his previous work at a hedge-fund.

Mediterranean diet officially shown to reduce risk of heart disease: A group in Ohio has published in Cell that targeting the gut microbiome with substances found enriched in the Mediterranean diet reduces their production of trimethylamine N-oxide, a substance that accelerates atherosclerosis.

Europe 

First immuno-oncology drug approved in EU by Amgen: Imlygic, Amgen’s first virus-based anti-cancer drug will be entering the EU markets. Imlygic is a modified strain of the herpes virus which invades cancer cells and replicates itself, triggering cell death while also stimulating the immune system to attack the cancer. It is currently marketed for melanoma but may be applicable towards other cancer types, especially in conjunction with PD-1 inhibitors.

Sanofi and Boehringer Ingelheim trade businesses: Sanofi is taking the plunge and exiting the animal health business, selling off Merial, it’s animal health unit to BI. In return, they get BI’s consumer health business (excludes China) and an additional cash payment amounting to a US$12.5 billion asset swap. This would make BI a leader in the swine health business and is a cost-cutting measure for Sanofi, allowing it to focus on human health.

Danish Nuevolution goes public: Danish biotech Nuevolution screens drugs using DNA tags and has numerous big pharma partners including Merck, Novartis and Boehringer Ingelheim. They have just gone public on Nasdaq First North Premier (a European growth market) after previously upping its IPO size to US$29.5 million. A couple of other Swedish companies have started the trend of going public which is increasing investor interest in the region.

Asia 

AstraZeneca goes big in China: AstraZeneca is investing more than US$800 million into China as it strengthens ties with CRO Wuxi Apptech to aid in their biologics manufacturing. It is also building a new R&D hub in and around Shanghai, hiring up to 50 scientists to work on biologics and small molecules. The deal establishes AstraZenaca’s presence in China and would facilitate progression of drug approval in China.

Samsung, the third largest biologics manufacturer: The heir to Samsung, Lee Jae-young, has taken the reins from his ailing father, and is driving Samsung into new unexplored territory. Over the past 4 years, Samsung has invested about US$2.74 billion in biologics manufacturing plants in South Korea. Mr Lee aims to cater to pharmaceuticals who outsource their drug manufacturing, although he has also invested US$1 billion into Samsung’s own R&D on biosimilars. Samsung now ranks third behind the Lonza Group (Swiss) and Boehringer Ingelheim (German) in terms of biologic drug manufacturing capacity.

Aslan Pharmaceuticals gets US$34 million: Aslan Pharmaceuticals headed by Dr Carl Firth, is a drug development company with a twist. Fundamentally, they in-license drugs that are no more than 6 months away from clinical trials, and put them through PI and PII trials in Asia. In-licensing basically involves reaching an agreement whereby both parties share the monetary risk of drug development, be it profit or loss. Its a less risky business model and probably a more efficient way of testing drugs that would never have made it to clinical trials.

 

CureVac secures $110 million in development of RNA vaccines

CureVac, a German biotech that specializes in mRNA therapies has recently secured $110 million in fresh funding from new investors Chartwave Ltd., Coppel Family, Elma Investments Ltd. and Sigma Group as well as existing investors dievini Hopp BioTech holding GmbH & Co. KG and the Bill & Melinda Gates Foundation.

Instead of using RNA for genetic interference, CureVac uses RNA to stimulate an immune response. It was first discovered in the 1970s that RNA when injected into Xenopus oocytes enabled the production of the protein which the RNA encoded for. Cellular introduction of RNA also tends to stimulate an immune response as both single and double-stranded forms can activate toll-like receptors, PKR, RIG-1 and other cellular sensors responsible for launching a potent immunostimulatory response. These two observations have melded since then as scientists have started using RNAs encoding cancer-specific antigens, which when introduced into patients, allow an immune response to be launched against these antigens, allowing selective killing of cancer cells. Although there has yet to be an approved RNA vaccine, various clinical trials are in progress mostly focussing on cancer. There has been one DNA vaccine approved against Japanese encephalitis but is only available in Australia. RNA vaccines are viewed to be much safer than DNA vaccines due to the lower risk of them being incorporated into the host genome.

CureVac’s competitors consist of Moderna Therapeutics, BioNTech and Planegg-based Rigontech. The latter two are also German companies whereas Moderna is US-based. All companies have been able to attract significant investor interest and support.

RNA therapeutics is of such relevant interest today largely because of its ease of synthesis and manipulation. Unlike small molecules and antibody/peptide-based therapies, nucleic acids can be chemically synthesized at low cost, easily altered without the need of medicinal chemists, and they are fairly stable. The only obstacles faced are how to efficiently introduce them at high levels into living systems and prevent unwanted side effects. They are highly subject to nuclease degradation and although chemical modifications such as base modifications – 2’fluoro/O-methyl, pseudouridines, 5′-methyl-cytidine – are said to increase their stability, these may be costly or difficult to introduce and may reduce efficacy. Furthermore, with the large intrinsic RNA content of living cells, it is not difficult to envision improper hybridizations may lead to some unwanted side effects.

Due to the numerous proof-in-concept studies however which show that RNA once introduced to the correct site, can produce the proteins required resulting in relevant effects (see here and here), there is large potential in this field. CureVac has also shown some promise towards increasing RNA uptake by developing a formulation where RNA is complexed with protamine. Other advances in nanoparticles are also expected to drive improvements in this area.