Welcome to your weekly roundup of EP Vantage’s snippets – short takes on smaller news items.
This week, January 15-19, 2018, we had thoughts on the following: Neurometrix up 20% on Glaxo deal; J&J and BTG’s hopes for longer Zytiga pay day fade; Pfizer and Foundation seek companionship; Siemens slims down before market debut.
These snippets were previously published daily via twitter.
Neurometrix up 20% on Glaxo deal
January 18, 2018
Glaxosmithkline has partnered with Neurometrix to develop its Quell device, a neuromodulator for the treatment of chronic pain, sending the latter’s share price up 20% yesterday – despite the deal being worth just $5m up front. Quell is intended for use with the peripheral nervous system, and consists of a device strapped to the upper calf – regardless of where the pain is felt – which emits pulses intended to stimulate sensory nerves in such a way that pain signals are blocked. Quell is one of more than 200 devices that have been cleared by the FDA under the classification Stimulator, Nerve, Transcutaneous, For Pain Relief, but is the only one to have attracted Glaxo’s attention. Glaxo’s consumer health division has taken ex-US rights to this curious technology, which has market clearance in both the US and Europe; Neurometrix retains control in the US. The two groups will co-fund further development of Quell for three years, and Glaxo is on the hook for up to $21.5m in milestone payments in future.
J&J and BTG’s hopes for longer Zytiga pay day fade
January 18, 2018
It was always a long shot, but it now seems even more unlikely that Johnson & Johnson and UK licensor BTG will enjoy extended revenues from Zytiga. Key patents protecting the prostate cancer drug have already expired in the US but J&J has been trying to assert longer term IP around Zytiga’s method of administration, which stretches out to 2027. In an inter partes review decision yesterday the US Patent & Trademark Office ruled that the claim was unpatentable, on grounds of obviousness. J&J has said it might appeal the decision and this seems highly likely, which at the very least could delay the proceedings for several for more months. Further news is due mid-February when the first summary judgement from a US district court could arrive, which will provide an indication of how a separate infringement trial might go. Of course an at-risk launch before all this concludes is possible – the 30 month stay since generics companies filed with the FDA ends in October this year. All of this is more important to BTG than J&J – the UK company counts Zytiga as its biggest revenue generator and analysts estimate that its royalty contribution will amount to 20% of the group’s earnings this year. BTG’s London-listed shares fell as much as 6% in early trade today as hopes for a longer pay day faded.
Pfizer and Foundation seek companionship
January 17, 2018
Foundation Medicine’s multi-drug molecular diagnostic FoundationOne CDx was approved in the US in November for use with a whole suite of cancer therapies from a range of manufacturers. Only one of them, Xalkori, was developed by Pfizer, however, and the big pharma group now wants to expand the range of its therapies with which FoundationOne CDx can be used. Pfizer has signed Foundation up as a partner to update the genomic test to allow it to be used as a companion to the other drugs in Pfizer’s oncology portfolio. Pfizer has 10 FDA-approved cancer drugs, and 17 more are in clinical development, Foundation Medicine said. The partnership will also permit Pfizer to use Foundation Medicine’s data analytics technology in the hope of finding new biomarkers and to improving the design of its clinical trials – it has 19 phase III studies currently active in cancer indications. Financial terms were not disclosed.
Siemens slims down before market debut
January 17, 2018
Siemens seems set to launch its IPO this year with fewer Healthineers on board. The conglomerate intends to make cuts worth €240m ($294m) a year from its healthcare division to get it into shape for the offering on the Frankfurt exchange, and while it has not gone into detail about its “structural cost savings initiatives” staff cuts are a quick and easy way to hit this target. The cuts will improve profit margins, Siemens says, with the first year of full impact being 2020. A strategic focus on markets adjacent to those in which it already operates and an emphasis on artificial intelligence – itself a term that might mean almost anything – ought to result in the newly independent Healthineers having profit margins of 20-22% for its imaging segment and of 16-19% for diagnostics in the medium term. The IPO itself, which will see 15-25% of Healthineers floated, is expected in the next six months and could raise around $9bn – making it easily the biggest healthcare IPO ever. This would value Healthineers as a company at about €40bn ($49bn); Siemens will be the majority shareholder.