Thursday, March 15, 2018

The Readout by Damian Garde & Meghana Keshavan

Welcome to The Readout, where we keep you on top of the latest in biotech. For more in-depth coverage of biopharma, subscribe to STAT Plus. On Twitter: @damiangarde@megkesh, and @statnews.

China's surging biotech sector gets an index

There's a new stock market index that, for the first time, will quantify and track the performance of China’s booming biopharma industry.

The Loncar China Biopharma Index (LCHINA), launched this week by health care investor and bio-Twitter mensch Brad Loncar, measures the overall performance of the publicly listed companies contributing to the growing clout of China’s biopharma industry. It fills an unmet need because, until now, investors had no good way to track such things, other than taking a DIY approach, Loncar says.

Loncar did something similar in 2015 when he launched the Loncar Cancer Immunotherapy Index (CNCR) to track biotech and drug companies developing new immuno-oncology drugs. That index eventually led to the creation of a companion exchange-traded fund, which recently surpassed $50 million in assets under management.

The new LCHINA index launches with 32 holdings — a mix of global drugmakers, growth-oriented biotechs, diagnostic companies and service providers — all currently listed on the Hong Kong Stock Exchange and the Nasdaq.

Elizabeth Holmes is settling fraud charges. Now what?

In the latest chapter of the Theranos saga, the SEC announced yesterday that it's bringing fraud charges against the blood-testing company and CEO Elizabeth Holmes. To settle the civil charges, Holmes must pay a $500,000 fee and give up her voting control over Theranos. 

So what's next for the turtlenecked wunderkind-turned-cautionary-tale and her company? Theranos recently got a loan to stave off bankruptcy and continue working on its post-scandal pivot: a "MiniLab" designed to run a variety of tests in different settings, albeit using the traditional method to draw blood. Meanwhile, the Department of Justice's criminal investigation into Theranos is reportedly ongoing and could still conceivably result in charges.

And then, of course, there's that Jennifer Lawrence movie (release date TBD) to look forward to.

Read more.

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'Right to try' isn't going away just yet

Tuesday's surprise defeat of a House "right-to-try" bill was a victory for the idea's many opponents, but there's ample will and plenty of ways for Republicans to give it another go.

The bill, which would set up a new pathway to allow sick patients to bypass the FDA and get access to unapproved drugs, could go back to committee in an effort to appease the Democrats who opposed it on process grounds, STAT's Erin Mershon reports. Or the House could just adopt the version passed by the Senate and fast-track it to President Trump's desk.

Read more.

Maybe 2018 won't be the year of the biotech buyout after all

The overwhelming consensus headed into this year was that pharma, armed with a sizable tax break, would spend all those savings buying up biotech companies. And in January, when $27.5 billion changed hands, that consensus looked overwhelmingly accurate.

But then things sort of dried up in February, and now the biopharma's dealmakers don't sound so exuberant. At this week's Cowen health care conference in Boston, a panel of M&A executives told investors that they don't expect tax reform to have a meaningful effect on who buys whom. And then they brought out the old saw that biotech is a little overvalued right now, making it difficult to find deals that actually work.

So basically it's 2017 all over again.

More reads

  • Pharma ad spend actually fell in 2017 for first time in years. FiercePharma
  • Drug makers are paying fewer and fewer fines for their bad behavior. STAT Plus
  • Diana Ross will be performing at the BIO convention in Boston in June. BIO

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