Snippets

Vantage Snippets are short summaries of breaking news stories.

Lilly’s Blazes a trail in Covid-19 prevention

Antibodies, already authorised to treat mild to moderate Covid-19, could soon also be used to prevent the virus, a study of Lilly’s bamlanivimab in nursing homes suggests. To be eligible for the trial, called Blaze-2, nursing homes had to have had at least one confirmed coronavirus case. Across residents and staff receiving bamlanivimab, there was a 57% reduction in the risk of developing symptomatic Covid-19 compared with those receiving placebo. Among residents the figure was even more impressive, with an 80% reduction with bamlanivimab versus placebo. Lilly plans to speak to regulators about expanding bamlanivimab’s EUA; however, there are questions about the role of the antibody if the vaccine rollout goes well. The logistics of infusing nursing home residents on a large scale might be also be tricky. Other antibody developers are looking at prevention, and a notable player here is Astrazeneca with AZD7442, a long-acting antibody. This is given intramuscularly, which could give it an edge over bamlanivimab and Regeneron’s casirivimab/imdevimab, which are both intravenous. Glaxosmithkline also has a long-acting project, the intravenous VIR-7831, but that does not appear to be in any prevention studies; the pivotal Comet-Ice trial in outpatients is set to read out this quarter.

Selected prevention studies with Covid-19 antibodies
Project Company Trial Setting Data?
Bamlanivimab (LY-CoV555)* Lilly/Abcellera Blaze-2**(NCT04497987) Prevention in nursing home residents and staff Positive data reported
Casirivimab + imdevimab (REGN-COV2)*** Regeneron Study 2069 (NCT04452318) Prevention in household contacts of Covid-19 patients Due H1 2021
AZD7442 Astrazeneca Provent (NCT04625725) "Pre-exposure prophylaxis" Due H1 2021
Storm Chaser (NCT04625972) "Post-exposure prophylaxis"
*Trial also includes combo with LY-CoV016 in treatment; **Conducted with NIAID; ***Subcutaneous formulation. Source: clinicaltrials.gov & EvaluatePharma.

Biopharma’s stock market winners and losers in 2020

It is no secret that the pandemic has been kind to drug developers, in terms of financial performance at least, with cash flowing into the sector and, in many cases, share prices surging. Thus, those working on Covid-19 treatments feature widely in 2020’s biggest gainers table, from vaccine makers like Biontech to South Korea’s Shin Poong, whose work on a repurposed malaria drug caused its stock to surge. On the faller’s side, any year contains a number of blow-ups in this high-risk sector, though investors in Amarin and Galapagos will be particularly sore; a surprise patent loss and unexpected R&D setbacks respectively caused the pain. Even the traditionally staid big caps provided some big swings last year, with the valuations of Lilly and Abbvie ballooning by billions on the back of clinical successes. Glaxo’s decline is also notable; the stock has been battered by concerns about cash flow and dividends, compounded by a weak R&D strategy that took another knock this week. It is barely credible that Moderna’s market cap is over half of Glaxo’s, a stark statistic that speaks to stock market frothiness, but that should also make executives at the now not-so-big pharma shift uncomfortably.

Biggest share price gainers of 2020   
Company  Share price gain Market cap gain ($bn) Market cap at Dec 2020 ($bn)
Big pharma 
Lilly ($) 28% 35.3 161.5
Abbvie ($) 21% 58.2 189.2
Johnson & Johnson ($) 8% 30.4 414.3
Big drug makers (+$25bn)   
Lonza (SFr) 61% 20.0 46.4
Merck KGaA (€) 33% 20.9 71.3
Regeneron ($) 29% 10.1 50.7
Mid-caps ($5-25bn)   
Moderna ($) 434% 34.8 41.3
Biontech ($) 126% 12.0 19.6
Celltrion (KRW) 98% 22.7 42.4
Small caps ($250m-5bn)
Shin Poong (KRW) 1,613% 5.4 5.7
Cytodyn ($) 439% 2.8 3.2
Denali ($) 381% 8.4 10.0
Arising from the micro caps… (<$250m)
Novavax ($)
2,702%
7.6 7.7
Seres Therapeutics ($) 661% 2.0 2.2
Adaptimmune ($) 349% 0.7 0.8
Note: Market cap brackets set as of Jan 1, 2020. Source: EvaluatePharma. 

 

Biggest share price fallers of 2020   
Company  Share price loss Market cap loss ($bn) Market cap at Dec 2020 ($bn)
Big pharma  
Glaxosmithkline (£) -25% -24.9 87.4
Merck & Co ($) -12% -24.6 207.0
Bristol Myers Squibb ($) -10% -10.1 140.4
Big drug makers (+$25bn)   
Bayer -34% -19.2 56.0
Fresenius -24% -10.4 20.3
Biogen -17% -15.9 37.7
Mid-caps ($5-25bn)   
Amarin ($) -76% -5.8 1.9
Galapagos (€) -57% -7.1 6.2
Reata ($) -40% -3.2 7.4
Small caps ($250m-5bn)
Aprea Therapeutics (SKr) -90% -0.9 0.1
Tricida ($) -81% -1.5 0.4
Nextcure ($) -81% -1.0 0.3
Note: Market cap brackets set as of Jan 1, 2020. Source: EvaluatePharma. 

Haemonetics and Hillrom deals add to medtech’s 2021 M&A fever

Another day, another medtech deal. The strong start to M&A in medtech is showing no sign of slowing as Haemonetics yesterday unveiled a $475m up-front swoop for Cardiva Medical, confirming this January as the best for acquisitions in over 10 years. Haemonetics, whose shares have benefited from rising demand for plasma-based medicines, is adding to its hospital offering with the buyout. Cardiva’s main attraction is its Vascade MVP vascular closure technology, usually used after aortic catheter surgery and other procedures. Haemonetics' announcement comes hot on the heels of Hillrom’s $375m cash play for Bardy Diagnostics, in the hopes of integrating Bardy’s wearable bio-sensing technology into its existing cardiac devices portfolio. Some are putting the recent flurry of medtech deals down to the Covid-19 pandemic accelerating the trend for adopting digital technologies and connected care, as underlined by Philips’ recent $635m takeout of Capsule. However, more traditional companies like Haemonetics are looking to increase scale by adding complementary businesses to their core operations. With companies continuing to adapt to the new world order presented by the pandemic, M&A is likely to remain a key focus in 2021.

Glaxo joins the Covid-19 delay queue

Glaxosmithkline will have to wait a little longer to find out whether dostarlimab can become the industry’s seventh anti-PD-(L)1 antibody to reach the market. A US Pdufa date in the second half of 2020 came and went with no statement from the company, but it now emerges that the Covid-19 pandemic is to blame for the delay. A Glaxo spokesperson told Evaluate Vantage that approval “requires a site inspection of our manufacturing site, the timing of which is contingent on Covid-19 travel restrictions. The site inspection has not occurred yet, so we are now expecting approval in the first half of 2021.” For now Glaxo is not mounting a strong challenge to the leaders, and its filing seeks approval in MSS or MSI-high endometrial cancer, a relatively obscure use in which only Keytruda’s label in MSI-high cancers irrespective of tumour type has an overlap.

Selected regulatory casualties of the Covid-19 pandemic
Project Company Pdufa date Outcome
Liso-cel Bristol Myers Squibb 16 Nov 2020 Covid-19 travel restrictions prevented manufacturing inspection; no CRL, no new Pdufa date
Leqvio Novartis/Alnylam 23 Dec 2020 CRL, citing unresolved facility inspection-related conditions; Covid-19 travel restrictions will delay in-person inspection
Dostarlimab Glaxosmithkline/ Anaptysbio H2 2020 Covid-19 travel restrictions prevented manufacturing inspection; no CRL, no new Pdufa date

Philips swallows a $635m Capsule

January is not yet two-thirds over and already medtech M&A deals worth more than $8.5bn in total have been kicked off in 2021 – the strongest start to a year for a decade. The latest acquisition is that of Capsule Technologies by one of the sector’s most prolific acquirers, Philips, for $635m in cash. The deal allows the Dutch group to get its hands on Capsule’s software, which is capable of connecting “almost all existing medical devices” and electronic medical records in hospitals, according to Philips, as well as collecting and analysing patient data. Data integration and analysis is a major thrust of Philips’s strategy, its $2.8bn purchase of Biotelemetry a month ago being a prime example. But the Capsule deal is only the fourth largest medtech acquisition announced so far in 2021. It seems these predicting a strong M&A market in the wake of the pandemic were, if anything, underestimating buyers’ ebullience.

Note: the analysis below includes only M&A deals with known values.

Thermo Fisher goes shopping

At $450m in cash, the acquisition of Mesa Biotech is not the largest deal Thermo Fisher has done; it is not even the largest it has done in the past week. But it is interesting. Mesa’s Accula technology allows nucleic acid PCR testing at the point of care, and can run Flu A/B and respiratory syncytial virus tests. An Accula Covid-19 test with a turnaround time of 30 minutes – very fast for a PCR assay – received emergency authorisation in late March. Mesa is expected to have sold $45m-worth of tests in 2020 and see rapid sales growth, Leerink analysts write. Thermo Fisher has had a good pandemic, its suite of Covid-19 tests generating $2bn in revenue in the third quarter of 2020 alone. The finding that its TaqPath assay can be used to track the fast-spreading B117 variant of the coronavirus has not hurt either. This has left the group with a considerable amount of cash – around $7.5bn at the end of the third quarter – part of which it put to use on Friday by buying the viral vector manufacturing business of Novasep for €725m ($879m). This unit provides contract manufacturing services for vaccines and therapies to biopharma groups.

Asco-GI 2021 round-up – Cardiff disappoints while Arcus intrigues

Enhertu’s additional approval this morning for Her2-positive gastric cancer coincided with the Asco-GI conference, which featured a front-line gastric cancer study of Five Prime’s bemarituzumab as a late-breaker. The green light, the first for a Her2-directed therapy for this cancer since Herceptin, will also remind investors what the Astra/Daiichi drug has to do to meet expectations: EvaluatePharma consensus forecasts see 2026 sales of $4.1bn, mostly in breast cancer. Meanwhile, much of Five Prime’s data was a retread of that toplined last November, and with continuing doubts about bemarituzumab’s relevance beyond FGFR2b-overexpressing cancers the stock fell 11%. Also off on Asco-GI data was Cardiff Oncology, down 31% after reminding the markets that, with four more Kras-mutant colorectal cancer subjects treated, the overall response rate to onvansertib was still around 40%. Bridgebio Pharma’s infigratinib showed a 23% ORR in FGFR2-positive cholangiocarcinoma, underperforming the 36% on the approved label of Incyte’s similarly acting Pemazyre. Perhaps the most intriguing dataset came from Arcus’s AB680 in front-line pancreatic cancer: 41% ORR in 17 subjects could give the company a focus beyond Tigit inhibition. Still, the study also included chemo and an anti-PD-1, so AB680’s effect is hard to tease out.

Clinical activity of AB680 + zimberelimab in 1st-line pancreatic adenocarcinoma. Source: Dr Gulam Abbas Manji & Asco.
Selected data presented at the 2021 Asco-GI meeting
Project Company Mechanism Setting Detail
Bemarituzumab Five Prime Anti-FGFR2b Fight study: a 1L gastric/GEJ (chemo combo) In FGFR2b ≥10% expressers (n=96) mPFS 14.1 vs 7.3 mth, mOS NR vs 11.1 mth
Infigratinib Bridgebio Pharma Anti-FGFR1-3 2L FGFR2+ve cholangio 1 CR & 24 PRs in 108 evaluable pts, mPFS 7.3mth, mOS 12.2mth
Tibsovo Agios Anti-IDH1 Final Claridhy study data: 2L IDH1-mut cholangio HR 0.37 for PFS, and 0.49 for OS, both highly stat sig
AB680 + AB122 Arcus Anti-CD79 + anti-PD-1 Arc-8 study: 1L pancreatic adenocarcinoma 7/17 PRs
Onvansertib Cardiff Oncology Anti-PLK1 2L Kras-mut colorectal (Avastin + chemo combo) 5/12 PRs
CYAD-101 Celyad Allo (TIM-expressing) Car-T vs NKG2D ligands Alloshrink study: metastatic colorectal 2/15 PRs, including 1 Kras-mutant

Novartis’s app trial goes Pear shaped

Pear Therapeutics' reputation as the poster child for digital health therapeutics took another hit yesterday after Novartis published results of a 112-patient clinical trial, showing no difference between Pear-004 and a sham app in managing schizophrenia symptoms. The disappointing results are not expected to stall the launch of a newer version of Pear-004, which is being rolled out now. But the data will almost certainly hit sentiment towards the updated app. The original version tested by Novartis was authorised for use last April under new FDA guidance that waived a number of regulatory requirements in the wake of the Covid-19 pandemic. Pear yesterday launched its defence of the app by questioning Novartis’s trial methodology. The study disappointment comes 15 months after Novartis served notice on parts of its wider collaboration with Pear. The Swiss group's Sandoz subsidiary handed back rights to commercialise the Reset and Reset-O digital prescription therapies for substance abuse in October 2019. With these therapeutics still in their infancy the Pear-004 trial failure and any other stumbles are likely to be seen as bellwethers for this fledgling field.

Merck & Co buys into Kras

A low-key research collaboration struck a year ago has led to Merck & Co today taking out an exclusive licence to an anticancer project targeting the Kras pathway. The work had originated at Otsuka, and focuses on inhibiting SHP2, an enzyme thought to play a role in cycling Kras between its “on” and “off” states. Though this is still preclinical, Merck has clearly seen enough to part with more cash; a year ago it had given Otsuka’s Taiho and Astex subsidiaries $50m to set up a research alliance into Kras, and today’s option for full rights involves a second payment, understood to amount to at least as much again. Direct inhibition of Kras is at present a battle between Amgen’s sotorasib and Mirati’s adagrasib, but other companies are working on indirect ways of hitting this target, which until recently had been thought to be undruggable. Such pathways include SOS1, under investigation at Bayer and Boehringer Ingelheim, as well as SHP2. The Merck programme’s most advanced competitors in this latter space are Novartis/Mirati’s TNO155 and Revolution/Sanofi's SAR442720.

Src homology phosphatase (SHP) 2 inhibitor pipeline
Project Company Comment
TNO155 Novartis/Mirati Ph1/2 (Krystal-2) study in Kras G12C mutants
RMC-4630 (SAR442720) Revolution Medicines/Sanofi Ph1/2 combo trial; deal signed Jul 2018
RLY-1971 Relay Therapeutics First-in-human ph1 started Feb 2020
BBP-398 (IACS-15509 / IACS-13909) Navire (Bridgebio Pharma) First-in-human ph1 started Aug 2020
ERAS-601 Erasca First-in-human ph1 (Flagshp-1) started Jan 2021
HBI-2376 Huya Bioscience/Suzhou Genhouse Preclinical; licensing deal Aug 2020
SHP2 programme Merck & Co/Otsuka Preclinical; licensing option exercised Jan 2021
SHP2 inhibitors Redx Pharma Earlier mentioned as a research project
Source: company announcements.

This story was updated to add the Erasca project.

Steris cleans up with $4.6bn deal for Cantel

In the midst of a pandemic that has seen surgery-focused medtech companies suffer, Steris is continuing to expand its offering with a multi-billion bet on the US company Cantel, its largest acquisition to date. A large proportion of Steris’s business is based on operating room equipment and sterilisation, an area that has been hit hard by the scaling back of elective surgery during the pandemic. What Cantel offers is not only a complementary endoscopy business through disposables, but a new dental revenue stream. Most dentists are still operating, and this is an area in which Covid has increased the focus on infection control and sterilisation. The dental business also brings with it personal protective equipment in the form of face masks, protective bibs and disinfectant products, a valuable capability given that the need for PPE is set to continue for the foreseeable future. The purchase also has echoes of Steris's $850m buyout of Key Surgical in October, another transaction that gave it protective equipment and was funded through a mix of cash and shares. While this might not be the most exciting of deals it clearly shows the strategic direction in which Steris is heading.

Steris's five biggest acquisitions
Date Target Value ($m) Focus
Jan 2021 Cantel Medical 4,600 Endoscopy; general & plastic surgery; nephrology
Nov 2015 Synergy Health 1,900 Endoscopy; general hospital & healthcare supply
Nov 2020 Key Surgical 850 General hospital & healthcare supply
May 1996 Amsco International 660 General & plastic surgery; general hospital & healthcare supply
Aug 2012 United States Endoscopy Group 270 Ear, nose & throat; endoscopy
Source: EvaluateMedTech & company releases.