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The Readout Damian Garde

CAR-T is becoming a money pit

The early returns on CAR-T cancer therapies have led biotech investors to rethink just how lucrative the treatments will be for drug companies. But for the hospitals actually doling out infusions, CAR-T may already be a cash-burning business.

As STAT’s Ike Swetlitz reports, hospitals around the country are shelling out for CAR-T without knowing whether payers will reimburse them. Medicare is still deciding how to cover the therapy, and private insurers have been handling claims on a one-off basis. At Virginia Commonwealth University’s Massey Cancer Center, for example, doctors have been administering CAR-T for about seven months and still haven't received a dollar from insurance companies.

For now, CAR-T is employed only as a last resort, so subsidizing its use isn’t breaking the bank. But if the drug industry succeeds in proving its benefit for more and more cancer types, hospitals could be forced into an impossible position. 

Read more.

Are we sure about this whole Bristol-Myers-Celgene thing?

What looked like a $74 billion safe bet is suddenly in a bit of doubt. Bristol-Myers Squibb just called an ad-hoc meeting of Wall Street analysts in hopes of convincing them that its proposed merger with Celgene is actually a good idea, the latest sign the company is taking a shareholder insurrection seriously.

As STAT’s Ed Silverman notes, management still has work to do. After the meeting, Wolfe Research’s Tim Anderson concluded that “the odds of deal closure are perhaps not as high as some are thinking, despite the precedent in biopharma where no deals ever seem to get blocked.”

What do you think? Exactly one month from now, Bristol-Myers’s shareholders will get to vote on whether they agree with management that Celgene is worth the price, or whether they side with a dissident faction claiming the deal is too risky. Will the merger go through as Bristol-Myers intends, or will the noise get loud enough to force the parties to renegotiate or scrap it altogether?

This deal is as good as done.
This fight is far from over.

Meanwhile, in Hong Kong

It has been nearly a year since the Hong Kong Stock Exchange changed its rules to allow money-losing biotech companies to go public, an effort meant to entice stateside companies to ditch the Nasdaq and list their shares there.

How’s it going? “Bid to Lure Biotech Listings From U.S. Falls Flat,” reads this Wall Street Journal headline, and the text below points out that not a single American company has taken Hong Kong up on its offer. Only six domestic biotechs have gone public in Hong Kong since last April, and the results have been mixed.

But it’s early days yet to call the experiment a failure. Leaders of the Hong Kong Stock Exchange have described their biotech evolution as a tiered process. As exchange Senior Vice President Michael Chan told STAT in September, the first step is building a market for local biotech and then using that to attract foreign interest. 

What do you call a test that’s more accretive than actionable? ‘Biomarkup’

Biomarkers, the molecular footprints of disease, can provide life-saving warnings to patients, which is why the tests that spot them are increasingly in demand. But those tests are neither perfect nor free, which creates a problematic situation for patients and doctors alike.

It’s a matter of incentives, experts from Boston Children’s Hospital explain in STAT. Not every patient needs a biomarker screening, and false positives can lead to unnecessary procedures. But selling tests benefits the manufacturers, and performing procedures benefits the doctors, and billing for all of the above benefits the hospitals.

Those economic pressures, which may not be apparent to doctors and patients, threaten to inflate a bubble for unnecessary tests, write Dr. Kenneth Mandl and Arjun Manrai. They even have a name for it: “biomarkup.”

Read more.

More reads

  • Trump budget pitches capping seniors’ out-of-pocket drug costs, cutting NIH funding. (STAT)
  • The life, troubles, and Celgene legacy of deal guru George Golumbeski. (Xconomy)
  • Axovant reaps the rewards from its gene therapy refocus. (EP Vantage)
  • How algorithms could bring empathy back to medicine. (Nature)

Thanks for reading! Until tomorrow,


Tuesday, March 12, 2019


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