Welcome to your weekly roundup of EP Vantage’s snippets – short takes on smaller news items.
This week, 1-5 August 2016, we had thoughts on the following: Novo Nordisk confirms stark US pricing outlook; Adaptimmune can adapt to T-cell setback; Misplaced excitement over Sarepta’s Essence; As Biogen erases its losses, valuation gets more demanding; Adicet deal should be of particular interest to Kite Pharma; Shire discontinuation is fresh blood for Spark; Advaxis gets more validation, courtesy of Amgen
Novo Nordisk confirms stark US pricing outlook
05 August 2016
As the ability to raise drug prices in the US becomes an ever more far-fetched notion, retaining access to patients has never been more important. Just ask the diabetes players. Sanofi’s share price has slid more than 6% this week in the wake of the decision by pharmacy benefit manager CVS to exclude Lantus from its formulary, and Novo Nordisk followed with an 8% slump today. The Danish insulin giant said that prices in the US would fall by low to mid-single digits in 2017, as deeper rebates offered to drug plans kick in. With the first insulin biosimilar due to reach the US market at the end of this year, investors are rightfully nervous that the market leaders in this space are going to have to fight ever harder on price to retain share. Which will inevitably hurt profits down the line.
Adaptimmune can adapt to T-cell setback
04 August 2016
Cell therapies have been the subject of much hype, but development of CAR-T and T-cell receptor-based products is a risky business. Adaptimmune is the latest player to get caught in a snag with a clinical hold on a pivotal trial of its GlaxoSmithKline-partnered T-cell therapy, NY-ESO Spear. But this is not a safety issue like the one that recently enveloped CAR-T developer Juno – Adaptimmune has not even begun enrolling patients in the study. Instead, the FDA has requested additional information on chemistry and manufacturing controls, which the company expects to be able to provide quickly. The hold does not include ongoing trials of the NY-ESO project in other indications including synovial sarcoma, melanoma, and ovarian and lung cancers, Adaptimmune says.
Misplaced excitement over Sarepta’s Essence
04 August 2016
Sarepta has just begun recruiting patients into a new phase III study of its Duchenne muscular dystrophy candidates SRP-4045 and SRP-4053, raising hopes – among some – that US approval for its lead candidate eteplirsen is imminent. Sarepta bulls pushed the company’s share price up 7% yesterday and another 7% in premarket trading today. Some observers believe the new trial, Essence, could be the confirmatory study needed for eteplirsen’s accelerated approval, as SRP-4045 and SRP-4053 use the same exon-skipping mechanism. However, they are likely over-optimistic: the new study is consistent with Sarepta’s previously stated plans and could be independent of the ongoing eteplirsen analysis. It could even be a sign that FDA talks on eteplirsen have gone badly, Leerink analysts noted. The odds remain stacked against Sarepta.
As Biogen erases its losses, valuation gets more demanding
03 August 2016
Rumours that Merck & Co and Allergan might be considering making a bid for Biogen have enabled the big biotech to erase its 2016 stock market losses and return to where it was trading last summer. Biogen’s stock had been in freefall since peaking in March 2015 on release of data with the Alzheimer’s disease project aducanumab, and news that its chief executive, George Scangos, was departing might have been interpreted as a “for sale” sign. However, Biogen’s valuation hinges on two fundamental drivers: success of aducanumab, an extremely high-risk project, and uninterrupted growth of the multiple sclerosis franchise, in particular Tecfidera. Biogen’s market cap today is already 25% above the risk-adjusted NPV of its assets, so a knockout bid would require nerves of steel.
Adicet deal should be of particular interest to Kite Pharma
03 August 2016
The California-based start-up Adicet Bio is known for little beyond raising an impressive $51m in its series A round in January, so yesterday’s deal with Regeneron will help raise its profile. Even though the five-year tie-up is worth just $25m up front, it highlights Adicet’s capability in fully human, allogeneic CAR-T and engineered T-cell receptor projects – areas that represent key developments in the growing adoptive cell therapy space. Another vital consideration is that Adicet’s founder and chief executive is Aya Jakobovits, who had served as chief exec of Kite Pharma until shortly before Kite’s $128m Nasdaq IPO two years ago. Expect Kite to take a close look at any intellectual property generated by Adicet.
Shire discontinuation is fresh blood for Spark
03 August 2016
While trumpeting impressive first-half financials, prompting a 4% stock rise yesterday, Shire quietly slipped out news that it was scrapping its haemophilia B gene therapy BAX 335. This should boost Spark Therapeutics/Pfizer’s rival project, SPK-9001, though Spark shares were unmoved yesterday. It should also be of interest to followers of Uniqure’s AMT-060, though this encodes wild-type factor IX, as opposed to the Padua variant employed by Shire and Spark and thought to result in higher factor IX activity and improved blood clotting. BAX 335 had already been sidelined in Shire’s takeover of Baxalta, and yesterday Shire said it would shift focus to a next-generation preclinical project. Shire is certain to remain active in haemophilia, but Spark just got some breathing space.
Advaxis gets more validation, courtesy of Amgen
03 August 2016
With a lucrative licensing deal with Amgen under its belt Advaxis looks to have drawn a line under the scare of a US clinical hold that had hit it last year. The deal covers ADXS-NEO, a cancer immunotherapy targeting neoepitopes, and is worth $40m up front plus $25m equity stake – a significant amount given that the asset is still at the preclinical stage. Advaxis closed up 30% yesterday. The company had been hit last October with a clinical hold on its lead project, axalimogene filolisbac, after a patient developed a listeria infection and died; the hold was lifted in December. Advaxis’s Lm-LLO approach uses a live, attenuated listeria strain with copies of a plasmid encoding a sequence that causes a fusion protein to be secreted inside antigen-presenting cells, stimulating an immune response. The company already has tie-ups with AstraZeneca and Merck & Co, and the Amgen deal gives it further validation.