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The Readout Damian Garde & Meghana Keshavan

KalVista becomes the latest biotech to double in value

Shares of KalVista Pharmaceuticals rose by about 110% yesterday on the news that the company’s on-demand treatment for a common symptom of the genetic condition hereditary angioedema met its goals in a mid-stage clinical trial.

As STAT’s Adam Feuerstein reports, KalVista’s drug relieved swelling quickly such that only 15% of attacks required the use of rescue medications within 12 hours, compared to 30% of the attacks treated with a placebo pill.

The news also marks yet another massive spike in value for a small biotech company. Last week, Cassava Sciences skyrocketed on interim data from an open-label Alzheimer’s study. On Monday, Ocugen nearly tripled on the announcement that it was simply raising money from investors. 

Read more.

One biotech hedge fund is out-SPAC’ing its rivals

While funds around the world scramble to launch blank-check companies, Perceptive Advisors has already found merger targets for three of them, turning relatively small cash investments into billions of dollars on paper.

The latest is Nautilus Biotechnology, which signed an agreement to merge with Perceptive Advisors' third SPAC, or special-purpose acquisition company. Nautilus, a Seattle firm focused on protein analysis, gets the $150 million Perceptive raised in its SPAC IPO plus another $200 million private investment, giving the company a valuation of roughly $1.3 billion once it starts trading.

That’s quite a short-term return for Perceptive, which owned 20% of the SPAC after starting it with a $25,000 investment and committing to put in another $4.5 million. On paper, that stake is now worth about $260 million, adding up to a nearly 60-fold return for Perceptive.

There are limits to the FDA’s flexibility on cancer drugs

A group of expert advisers to the FDA voted against broadening the use of Merck’s blockbuster cancer treatment Keytruda, echoing the agency’s own review and reminding the drug industry that even the FDA’s most lenient division has limits.

Merck wants to sell Keytruda to combat high-risk, early-stage triple-negative breast cancer along with chemotherapy. But the data supporting that application, FDA advisers voted yesterday, weren’t mature enough to establish Keytruda’s benefits. Their unanimous recommendation against approval followed last week’s briefing from agency staff, who ruled that the trial results presented only “questionable clinical meaningfulness.”

The news likely means Merck will have to gather more data from its ongoing trial before it can convince the FDA to widen Keytruda’s label. 

It’s always a good time to raise money

Speaking of KalVista Pharmaceuticals, the company was one of six biotech firms to launch stock offers yesterday, taking advantage of price swings explicable and otherwise in the middle of a volatile market for drug developers.

Joining KalVista were Codiak BioSciences, SQZ Biotechnologies, Oncorus, Mereo BioPharma, and Adicet Bio. 

With the closely watched XBI biotech index hovering around its all-time high, the drug industry sees an opportunity to raise cash. According to Nasdaq, 11 public biotech companies have priced secondary offerings in February alone, raising about $1.7 billion in the process.

More reads

  • Eli Lilly's antibody combination receives FDA emergency use authorization for Covid-19. (Reuters)
  • House Democrats slip drug-pricing proposal into Covid-19 relief bill (STAT+)
  • The Broad Institute’s new leader wants to ‘double down’ on biology. (Boston Globe)
  • To the delight of generic drug makers, federal appeals court tosses controversial ‘skinny labeling’ decision. (STAT+)
  • Hong Kong biotech sector booms on buoyant markets and pandemic. (Financial Times)

Thanks for reading! Until tomorrow,

Wednesday, February 10, 2021


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