The Readout Damian Garde & Meghana Keshavan

FDA tea leaves have become illegible

For much of 2021, there’s been a creeping narrative that the FDA had suddenly taken a turn for conservatism, issuing surprise clinical holds and handing down shocking rejections, whether because of politics, internal strife, or three-dimensional chess, depending on whom you ask. But a recent run of on-time, drama-free drug approvals has complicated that theory.

Yesterday, Alkermes won FDA approval for an antipsychotic called Lybalvi. The decision came on the FDA’s promised date, and the label brought no curveballs or unexpected safety constraints. The week before, Biohaven won a similarly timely and uncomplicated approval for its oral migraine treatment. “While investors have become increasingly concerned about a less predictable FDA, we believe these two approvals should ease some of those concerns,” Mizuho analyst Vamil Divan wrote in a note to clients.

But the broader takeaway might be that the FDA has never been broadly predictable. The drug-approving arm of the agency is divided into various fiefdoms with their own regulatory ideologies, personnel changes, and internal dynamics. The past six months have provided ample evidence for divergent theories about the relative conservatism and flexibility of the FDA as a whole, but it might be wiser to conclude that it’s simply a land of contrasts.

It’s going to cost $50 billion to close the Covid vaccine gap

That’s according to four global agencies, which are calling for wealthy nations to donate funds and ease trade rules to get Covid-19 vaccines to the countries that need them most.

As STAT’s Ed Silverman reports, the pandemic is at a “perilous point” and requires a sizable investment to avert further disaster, according to a statement from the World Health Organization, the World Bank, the World Trade Organization, and the International Monetary Fund. The agencies issued a “call to action,” urging global powers to donate to the WHO’s vaccine distribution program and invest in manufacturing capacity.

Their case is two-fold: Inequitable vaccine development is leaving millions vulnerable to the virus, and it’s prolonging the global economic effects of the pandemic. Ramping up vaccine distribution would not only save lives in low-income countries but generate an estimated $9 trillion in additional global economic output by 2025, according to an IMF analysis. 

Read more.

How do you value a Vant?

Immunovant has run into problems developing its lead drug, which has pushed its share price down. On the other hand, Roivant, its parent firm, has publicly planned to buy the company outright, which is good for the share price. That makes Immunovant a quandary for investors when, as was the case yesterday, it gets some bad news.

The story is that Immunovant’s treatment, IMVT-1401, appears to raise bad cholesterol in clinical trials. That safety signal first emerged in a study on thyroid eye disease, and yesterday Immunovant said it was a common thread in multiple IMVT-1401 trials. Now the company is delaying the treatment’s path to market to get a better idea of its risk-benefit profile.

The news sent Immunovant’s share price down more than 35%, but the specter of Roivant and a future above-the-market buyout still shadows the conversation. Any investor betting on Immunovant can’t be certain Roivant’s stated plans will actually materialize. And anyone betting against the company faces the risk that Roivant will offer a massive premium for Immunovant simply because it can.

Biotech’s biggest news is still on the horizon


The XBI, a closely watched biotech index, slumped to another daily decline yesterday, extending a lengthy swoon that has cut nearly 30% of its value since February. But the biggest events of what should be a momentous second quarter are still to come, which is to say biotech will only become more volatile. 

Any day now, Vertex Pharmaceuticals will have data on VX-864, a second-generation treatment for the rare disease alpha-1 antitrypsin deficiency, which has become a proving ground for the company’s ambitions outside of cystic fibrosis. Likewise, Sage Therapeutics is expected to have results from a pivotal trial on its once-failed treatment for depression, a massive binary event that also has implications for Biogen, which owns a stake in the drug.

But the largest event of biotech’s quarter — and, probably, year — is the FDA’s pending decision on Biogen’s aducanumab, a controversial treatment for Alzheimer’s disease up for approval by June 7. 

Each of those catalysts has been picked apart and predicted for months. All that remains is the actual news. And, in terms of the XBI, the only certainty is more shake-ups. 

More reads

  • FTC issues a non-committal report on ‘rebate walls,’ but will the agency dig deeper? (STAT+)
  • Moderna files for full U.S. approval of Covid-19 vaccine. (Reuters)
  • STAT+ Conversations: A look ahead to ASCO 2021. (STAT+)
  • Five more biotechs file their SEC paperwork as the IPO Class of 2021 swells to 60. (Endpoints)

Thanks for reading! Until tomorrow,

Wednesday, June 2, 2021


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