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The Readout Damian Garde & Meghana Keshavan

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Bristol Myers is paying $13 billion for a company that was worth a quarter of that last year

Bristol Myers Squibb believes MyoKardia’s experimental heart drug is a blockbuster in the making, and it’s paying $13.1 billion to secure the treatment for itself.

As STAT’s Matthew Herper reports, the purchase price is a 61% premium to MyoKardia’s most recent close and adds up to roughly four times the company’s market value at the start of 2020. The allure is mavacamten, a treatment that, in data released in May, demonstrated a dramatic benefit for patients with an inherited, progressive heart disease called hypertrophic cardiomyopathy.

Financial analysts have said sales of the drug could exceed $2 billion per year, and Bristol Myers Chief Commercial Officer Chris Boerner said mavacamten “has all the core elements needed to be a very large and successful brand.”

Read more.

The FDA still rejects things

Among the more consistent sources of anxiety in recent years is the notion that the FDA, under increasing political pressure, has softened its standards for reviewing new treatments, endangering the public in the process. The coming debate over Covid-19 vaccines could shift that conversation in either direction, but in the meantime, the FDA remains plenty willing to say no to drug companies.

Yesterday, Iovance Biotherapeutics lost about $1 billion in market value after the agency asked for more potency data on its lead drug, a treatment for skin cancer, which delayed the company’s plans to file for approval. Within minutes of that news, Y-mAbs Therapeutics fell by about 21% after announcing that the FDA had refused to even consider its approval application for a brain cancer treatment.

Anecdotes are no substitute for data, whether seeking FDA approvals or evaluating them. But the cases of Iovance and Y-mAbs — much like that of BioMarin and its shocking FDA rejection earlier this year — suggest the agency has hardly fallen into regulatory capture.

Amgen has very little to say about its ‘positive’ cancer data

Among 2020’s most anticipated clinical readouts is one from Amgen, whose cancer treatment sotorasib has the potential to treat tumors once considered undruggable. Yesterday, Amgen announced those results, albeit without any details and almost no numerals.

For patients with advanced lung cancer, Amgen’s drug had a “positive” effect on tumor shrinkage in a Phase 2 trial, the company said, one that was “consistent” with the results from a Phase 1 study. The duration of responses was “promising,” the company added, and the safety profile was “similar” to what was seen in early studies.

Drug companies are often less than forthcoming in press releases when they intend to present data at future medical meetings, which Amgen has promised to do for sotorasib. But this amount of vagary stands out even in that context, and it could be cause for alarm. Amgen has said that this Phase 2 study could support FDA approval if the response rates and durability are strong enough. The lack of detail on those two fronts might signal a disappointment.

The big trend in 2020 is buying stuff you used to own

Yesterday, Bridge BioPharma agreed to trade a combination of cash and stock to take full ownership of Eidos Therapeutics, a company it founded in 2017. The deal, which values Eidos at nearly $3 billion, marks yet another example of a biotech company paying a premium for something it used to own, which might not sit well with shareholders.

As Jacob Plieth pointed out in EP Vantage, in acquiring Eidos, BridgeBio is essentially paying $980 million to reclaim something it let go for just over $100 million, which is perhaps not the most efficient use of capital. But Eidos’s journey — from spinout to IPO to re-acquisition — has lined BridgeBio’s pockets thanks to the majority stake it held onto.

The case is not as tidy for Illumina, which this year spent $8 billion to acquire the remaining shares of Grail, a blood testing firm it founded in 2015. Ionis Pharmaceuticals paid a similar premium for Akcea Therapeutics, which it spun out in 2017. Akcea went public at $8 a share and Ionis reabsorbed it for $18.15 per share, making it unclear whether the spinout was wise in the first place.

More reads

  • FDA issues rare emergency authorization for an algorithm used to inform Covid-19 care. (STAT Plus)
  • Russia fast-tracks second coronavirus vaccine. (Wall Street Journal)
  • Supreme Court to review contentious state law governing pharmacy benefit managers. (STAT Plus)
  • Trio wins Nobel Prize in medicine for discovery of hepatitis C virus. (STAT)

Thanks for reading! Until tomorrow,

Tuesday, October 6, 2020


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