Acquisitions/mergers/joint-ventures/divestments

The boards of Pfizer and Allergan have agreed to merge their respective companies in a deal worth $155 billion and create the world largest pharma company with combined sales of over $60 billion. The new company will conduct business as Pfizer plc and will be domiciled in Ireland making it the largest “inversion” deal ever with Pfizer’s CEO Ian Read leading the combined company and Allergan’s CEO Brent Saunders serving as President and COO. Under the terms of the transaction Allergan shareholders will receive 11.3 shares of the combined company for each Allergan share while Pfizer shareholders will receive one share of the new company for each Pfizer share. There will also be a cash component of between $6 billion and $12 billion. Allergan shareholders will hold 44% of the equity of the new company, which should allow it to escape the new inversion rules being imposed by the U.S. Treasury Department. The pro forma adjusted effective tax rate for the new company is expected to be 17-18% down from a current evaluated rate of 25%. U.S. politicians are heavily condemning the deal with as a tax dodge. Democratic nominee Hillary Clinton accused the company of avoiding its "fair share" of taxes that "will leave U.S. taxpayers holding the bag," while Republican candidate Donald Trump called the deal "disgusting" and said "our politicians should be ashamed."

Shire is reported to be preparing a new hostile takeover proposal for Baxalta, the spin-off of Baxter, after the failure of the previous offer valued at $30 billion. According to a Reuters report Shire has asked several banks and advisers to revive a new offer consisting in a cash-and share plan.

Sanofi is working with Banque Lazard to prepare the divestment of Merial, its animal health unit which, according to Reuters, is valued at €12 billion. Merial has about 6,500 employees and expected sales of €2.5 billion in 2015.

Business 

Novo Nordisk has entered a licensing deal with Ablynx (Ghent, Belgium) to discover and develop new drugs based on the nanobody technology developed by Ablynx. Nanobodies are single domain heavy chain antibodies which specifically bind to antigens. Under the terms of the deal Novo Nordisk will pay an upfront fee of €5 million and up to €4 million in research funding as well as development and regulatory contingent milestones of €182 million per programme plus tiered royalties on net sales.

AstraZeneca signs a deal to divest Entocort, its Crohn’s disease drug by selling the US rights to Perrigo for $380 million as part of a move to sell non-core products and invest in a pipeline of new products. This is the first move by Perrigo after the long-running hostile takeover attempt by Mylan to “deliver industry-leading future prospects”.

Ipsen (Boulogne-Billancourt, Paris, France) collaborates with Interprotein (Osaka, Japan) in a research collaboration and an option agreement to develop and commercialize new therapeutic peptides intended to treat serious endocrinology conditions, such as Cushing's disease. Ipsen will combine its expertise in design and development of therapeutic peptides targeting with Interprotein's Protein-Protein Interaction and helix-loop-helix-peptide technologies. Under the terms of the agreement Ipsen would pay up to €165 million, in upfront, R&D, regulatory and commercial milestones, plus royalties on net sales.

Dilon Diagnostics (Newport News, VA, USA) an imaging company, has entered a partnership with GE Healthcare to distribute its novel NM750b molecular breast imaging system. The new system, based on Cadmium Zinc Telluride detectors is intended to detect early cancer and small tissue changes and is designed for breast cancer detection and treatment monitoring.

Approval of drugs, vaccines, diagnostics and devices

European Commission approves:

Vertex Pharmaceuticals Orkambi, a combination of lumaflacor and ivacaflor, for the treatment of cystic fibrosis in patients who carry two copies of the FD508 del mutation. Late-stage clinical trials demonstrated that the drug improved patients' lung function and body mass index, and reduced pulmonary exacerbations.

Novartis’ Entresto, a combination therapy of sacubitril and valsartan, for the treatment of heart failure patients with reduced ejection fraction. The drug has been approved earlier this summer by the US FDA.

Boehringer Ingelheim’s Praxbind, an antidote of its anticoagulant Pradaxa (dabigatran), to reverse serious bleedings in emerging situations. Praxbind is the only approved antidote to the Factor Xa inhibitors.

….gives conditional approval for Amgen’s Blincyto or blinatunomab for the treatment of patients with rare Philadelphia chromosome-negative relapsed lymphoblastic leukemia. Blincyto, a BiTE antibody construct, a new type of immunotherapy designed to help the body’s immune system in engaging two targets simultaneously to detect and target malignant cells. Under the conditional marketing approvals process in Europe, the drug’s license will need to be renewed every year and will only receive full clearance once post-licensing commitments have been fulfilled.

…. and recommends Samsung Bioepsis’ Benepali or etanercept, a biosimilar of Amgen’s Enbrel, developed by the JV of Biogen and Samsung Biologics. Benepali is manufactured at Biogen’s plant in Hillerǿd (Denmark)

US FDA approves:

Takeda’s Ninlaro (ixazomib), in combination with dexamethasone and Revlimid for the treatment for multiple myeloma. The approval is the third one for multiple myeloma in the US this year, following clearance of Novartis’ Farydak (panobinostat) in February and Janssen Biotech’s Darzalex (daratumumab) two weeks ago. Ninlaro acts as Velcade, a proteasome inhibitor that blocks the ability of cancer cells to reprocess essential proteins, but can be given orally.

Eli Lilly’s Portazza or necitumumab for the treatment of advanced squamous non-small cell lung cancer patients (NSCLC). Necitumumab is a monoclonal antibody blocking the activity of EGFR.  Metastatic squamous NSCLC is difficult to treat with few treatment options, and patients with metastatic disease have a five-year survival rate of less than five percent.

Novartis' Fluad, a trivalent (two subtype A and one type B) influenza vaccine that is the first seasonal flu vaccine containing an adjuvant (MF59), for the prevention of seasonal flu in people at least 65 years old.

…and extends Bristol-Myers Squibb Opdivo (novolumab) approval for the treatment of renal cell carcinoma patients.

Drugs at clinical stage

Regeneron Pharmaceuticals and Sanofi announce the completed enrollment of ~18,000 patients in their global Phase 3 study, ODYSSEY OUTCOMES, evaluating the potential cardiovascular benefits of their anticholesterol drug Praluent (alirocumab) after an acute coronary syndrome (ACS). The trial is designed to determine if the addition of Praluent to statin therapy reduces major adverse cardiac events in patients who have had an ACS. The results of the study should be available in 2017.

The European Medicines Agency’s grants orphan designation for Pfizer and Merck KGaA’s avelumab, a fully anti-PDL1 IgG1 monoclonal antibodyfor the treatment of Merkel cell carcinoma a rare and aggressive skin cancer (see previous reports in newsletters # 47, 41 and 39).

Pfizer’s pregabalin fails in a phase 3 clinical trial for the treatment of chronic post-traumatic peripheral neuropathic pain to achieve its primary endpoint in pain reduction.

Science and Technology

A recent study published in the journal Circulation indicates that regular coffee drinkers – between two and five cups per day – have a lower risk of dying early from problems such as heart diseases, diabetes, brain conditions and suicide. The results come in sharp contrast with research conducted in the 1970s and 1980s that linked coffee to higher rates of cancer and heart disease, but didn’t account for the fact that coffee drinkers are also more likely to smoke. The study authors say “results from this and previous studies indicate that coffee consumption can be incorporated into a healthy lifestyle.”

According to CBC News and Channel News Asia, China is facing the emergence, in several hospitals, of a new bacteria that is resistant to most effective antibiotic collistin.

Medical Devices and Diagnosis News

US FDA has issued a safety communication related to intravascular implanted devices and delivery tools that have coating designed to reduce friction. "The FDA wants to make healthcare providers aware of the possibility that hydrophilic and/or hydrophobic coatings may separate (e.g., peel, flake, shed, delaminate, slough off) from medical devices and potentially cause serious injuries to patients," said the agency's statement. The agency notes that since the start of 2010, there have been 11 recalls from various manufacturers associated with the peeling or flaking of these coatings from medical devices. Since the beginning of 2014, 500 medical device reports of separating coatings with 9 deaths due to the problems occurred during brain and heart catheterization.

Cost, Pricing and Market Access

Round one and two for Amgen’s Repatha. Less than two weeks after the US insurer Harvard Pilgrim Health care has agreed to include Repatha as the only PCSK9 inhibitor cholesterol lowering drug in its formulary, US Pharmacy benefit manager CVS Health also exclusively adds Amgen’s Repatha to its commercial formularies shutting out Regeneron/Sanofi’s Praluent. In both cases Amgen has agreed to tie the price of Repatha to its effectiveness and enforces the “value-based pricing” concept. Anthony C. Hooper, Amgen’s executive vice president of Global Commercial Operations said "Value-based partnerships are a key area of focus for Amgen, and Repatha gave us a great opportunity to offer value based contracts that address payers' concerns by linking the net price of Repatha to expected LDL cholesterol reductions and anticipated appropriate patient utilization.”

Highly busy week at The National Institute for Health and care Excellence (NICE) which recommends:

• paclitaxel and pegylated liposomal doxorubicin hydrochloride, as monotherapies or in combination with platinum, for treating ovarian cancer if it returns after chemotherapy.
• Lundbeck/Takeda’s Brintellix (vortioxetine) as a third-line treatment for major depressive episodes for adults whose condition has responded inadequately to two antidepressants.
• Merck, Sharp & Dohme’s immunotherapy Keytruda (pembrolizumab) as an option for patients with advanced melanoma that has not been previously treated with B-MS’ Yervoy (ipilimumab), as long as the company continues to provide with the agreed discount.

and rejects four anti-cancer drugs:

• gemcitabine, topotecan and trabectedin to treat the first recurrence of platinum-sensitive ovarian cancer.
• Celgene’s Otezla (apremilast), because, despite recognising the drug as an innovative step forward in psoriasis treatment, it failed to fall within bounds of what is normally considered value-for-money for the NHS.

Miscellaneous

Chris Viehbacher, the former CEO of Sanofi is launching its first development company called Boston Pharmaceuticals under the Gurnet Point Capital venture funded by Swiss billionaire Ernesto Bertarelli (see newsletter # 26). The startup plans to acquire multiple drug compounds from other companies or academic labs, take them through the first rounds of clinical studies to “proof of concept,” and then sell them off to larger drug makers that will carry them forward through regulatory approval and onto the market.

Bioevents

• Biofit 2015 on December 1-2 in Strasbourg (France)

Events in 2016

• BIOTech ShowCase 2016 on January 11-13 in San Francisco (USA)
• JP Morgan 33^rd Annual Healthcare Conference on January 12-16 in San Francisco (USA)
• BIO CEO Investor Conference on February 8-9 in New York City (USA)
• BIO Asia 2016 on March 15-16 in Tokyo (Japan)
• Global Healthcare Forum on March 16-17 in Singapore (Singapore)
• BIOPharma Asia Convention on March 22-24 in Singapore (Singapore)
• BIO Europe Spring on April 4-6 in Stockholm (Sweden)
• BIO Vision on April 13-14 in Lyon (France)
• BIO-IT World Conference & Expo’16 on April 5-7 in Boston (USA)
• BIO Trinity on April 25-27 in London (UK)
• Strategic Alliance Management Congress on May 16-18 in Philadelphia (USA)
• China BIO Partnering on May 18-19 in Suzhou (China)
• BIO International Convention on June 6-9 in San Francisco (USA

IMPORTANT NOTICE

This document has been prepared by btobioinnovation and is provided to you for information purposes only.  The information contained in this document has been obtained from sources that btobioinnovation believes are reliable but btobioinnovation does not warrant that it is accurate or complete. The views presented in this document are those of btobioinnovation’s editor at the time of writing and are subject to change.  btobioinnovation has no obligation to update its opinions or the information in this document.

Author: Jean-Claude Muller, Special Advisor at I&IR, jcm@btobioinnovation.com

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