Interview – Ipsen needs more deals to keep growth going

Ipsen’s increased focus on oncology seems to be paying off, with the company this week reporting a better than expected 2017 performance, helped by a strong showing from its new products.

But the French group does not plan to stop now, and has a €1bn ($1.25bn) war chest for deals in its preferred areas of cancer, neuroscience and rare diseases. “It’s our number-one priority: to build a sustainable pipeline,” Ipsen’s chief executive, David Meek, tells EP Vantage. With the company’s current pipeline looking rather sparse, the pressing need is obvious.

Still, $1bn does not go that far in this day and age, and Ipsen will be priced out of oncology’s hottest segments. Mr Meek does not seem concerned about sky-high valuations, saying: “We think that’s adequate firepower based on the targets we’re looking at.”

The group will look at all types of deals including licensing and outright M&A, he says, adding: “It could be a couple of small, early-stage transactions, or something larger at the mid or later stage.”

Ipsen's pipeline*
Project Indication Mechanism
Phase II
VSN16R/Canbex Multiple sclerosis spasticity Muscle relaxant
Phase I
PRRT Gastroenteropancreatic NETs Peptide receptor radionuclide therapy 
Short-acting toxin botulinum toxin E Undiclosed neuroscience indications Neuromuscular blocker
*Excluding line extensions. Source: company 2017 results presentation.

Mr Meek hinted during Ipsen’s earnings call yesterday that, within oncology, niche solid cancers could be a focus, pointing out that the company is active in relatively small indications like neuro-endocrine tumours (NETs), with Somatuline, pancreatic cancer, via Onivyde, and renal cancer, through Cabometyx.

The group has access to Cabometyx through a licensing deal with Exelixis outside the US and Japan, and acquired Onivyde from Merrimack last year (Merrimack falls for $1bn oncology offer from Ipsen, January 9, 2017). 

As for neuroscience, Ipsen is not looking at diseases like Alzheimer’s or depression, Mr Meek says: “We’re talking more niche, speciality-driven neuroscience.” The company already has a footprint here with Dysport, a botulinum toxin to treat muscle spasticity as well wrinkles. 

For now, Ipsen looks safe from becoming a takeover target itself – although the group is publicly traded on Euronext Paris around 55% of its stock is held by the family of its founder Henri Beaufour.

Mr Meek shrugs off the question of whether the Beaufour family has shown any signs of wanting to cash in the investment, only saying: “Our objective is to remain an independent and sustainable biopharma company.”


While Ipsen has so far gone for oncology niches, this does not mean that it has no competition. Somatuline, its biggest seller, was recently joined in the NET market by Lutathera, now in the hands of Novartis.

Mr Meek seems unconcerned, saying that Lutathera will be reserved for patients who have progressed on somatostatin analogues like Somatuline. “For the most part, we would have lost that patient anyway – they would have gone onto some form of chemo.”

He reckons Lutathera’s approval could actually be a plus for Ipsen: “When a patient goes on Lutathera they may go on a drug holiday from the somatostatin analogue, but [later] come back on.” And another entrant into NETs could increase awareness of the disease. “We know the patients that are treated are a pretty small subset of those who actually have NET.”

Meanwhile, Cabometyx is going up against checkpoint inhibitors in renal cancer, a battle that should only intensify as the compounds move into first-line disease – Cabo got US approval here late last year, and a European nod is expected in the first half of 2018.

Mr Meek contends that both mechanisms have a place: “If a patient were to get an immuno-oncology agent first line they’re not going to get it second line.” And a study of Cabometyx plus Bristol-Myers Squibb’s Opdivo, Checkmate-9ER, could pave the way for a combo in first-line renal cancer; data are due next year.

“We see Cabo as real backbone for renal cell carcinoma for years to come,” Mr Meek concludes. With the drug also set to be filed in second-line liver cancer this year, Ipsen expects an acceleration from 2017's €52m ($65m) sales.

Consumer cash engine

Oncology is the largest part of Ipsen’s speciality care business, which accounted for 83% of the group’s sales in 2017, but the company also has a consumer unit, which returned to growth in 2017 after a couple of years in the doldrums.

Mr Meek seems keen to keep hold of the franchise: “Some of the cash generated from our consumer business helps us add more assets to ... speciality care. For now our objective is to keep [the consumer] business growing.”

Ipsen will not participate in the rumoured deals for Pfizer and Merck’s consumer offerings – but it could be a beneficiary of any M&A by picking up smaller units that need to be offloaded for antitrust reasons, its chief financial officer, Aymeric Le Chatelier, said during yesterday’s conference call.

But the group’s main M&A aims are clear. Ipsen will have to hope that it can find some bargains in one of the industry's most hyped areas.  

To contact the writer of this story email Madeleine Armstrong in London at [email protected] or follow @ByMadeleineA on Twitter

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