The S&P Select Biotech Index ended 3Q at the 50-day moving average as investors weighed expectations for a lower cost of capital against geopolitical uncertainty.
Any signs of economic softening may reinvigorate a flight to safety, potentially benefiting pharma and biotech companies that are providing important medicines. The US election cycle is entering the home stretch with a little over a month to go. Volatility may provide buying opportunities for companies with fundamentals generally decoupled from the election outcome.
M&A:
Roche's (RHHBY) Genentech oncology unit paid $850 million in cash plus potential future milestone payments to acquire a portfolio of next-generation CDK inhibitors for the treatment of breast cancer from China-based Regor Pharmaceuticals (private).
Bristol Myers (BMY) announced a research collaboration with Prime Medicine (PRME) to develop multiple prime edited ex vivo T cell therapies. BMY will pay $55 million upfront, make a $55 million equity investment and pay downstream milestones. The cash infusion extends PRME's cash runway into 1H 2026.
Regulatory:
Cassava Sciences (SAVA) announced they reached a settlement with the SEC to resolve negligence-based claims related to the Phase 2B clinical trial data of Simufilam for a payment of $40 million.
Bristol Myers (BMY) announced FDA approval of Cobenfy (KarXT; a novel M1/M4 agonist) in schizophrenia without a black box. The approval brings the first new mechanism of action to patients with the disease in over 30 years. BMY acquired Karuna for $14 billion at the end of last year to obtain this drug.
Clinical:
Pfizer (PFE) abruptly announced the global market withdrawal of sickle cell therapy Oxbryta based on new clinical data that “now indicates the overall benefit of Oxbryta no longer outweighs the risk”. Specifically, the data suggested an imbalance in vaso-occlusive crises and deaths. PFE acquired Oxbryta in the $5.4 billion deal for Global Blood Therapeutics in 2022 and the drug was projected to post $400 million in revenue this year. Medicinal chemists had been skeptical that chronic dosing of a drug with an aldehyde was a good idea. PFE noted 2024 EPS will be unchanged despite the withdrawal.
Celldex Therapeutics (CLDX) announced updated 52 week c-KIT mAb k Barzolvolimab that showed deepened responses in CSU through. The stock was volatile on the safety data that showed an uptick in neutropenia and pigment changes in hair and skin. Many analysts came in to defend the data, with at least one upgrade as the drug appears to be approvable.
Amgen (AMGN) released top-line data from the rocatinlimab OX40 program in atopic dermatitis that showed 19% placebo adjusted EASI-75 coming in below standard of care Dupixent at 30-35%. The modest efficacy was a step down from what was observed in the earlier Phase 2 trial.
Amgen (AMGN) released top-line data for Uplizna in myasthenia gravis (MG) that showed a 1.9 point placebo adjusted MG-ADL dosed Q6m. The drug offers a new mechanism compared to approved drugs from Argenx (ARGX) with ~3 points MG-ADL dosed QW and UCB (UCB BB) with ~2.6 points dosed QW. Analysts project preferred use might be second line following FcRn therapy.
2Seventy Bio (TSVT) announced discontinuation of the phase 3 KarMMa-9 trial in newly diagnosed multiple myeloma patients due to improvement in the existing treatment paradigm leaving fewer eligible patients than initially expected.
Engene Holdings (ENGN) announced Ph2 data for detalimogene in NMIBC that showed a 71% CR rate at any time in pivotal cohort and a CR rate at 6mo was of 47%, missing street expectations.
Corporate Updates and Earnings:
Prothena Corp (PRTA) slid ~20% on news the CMO was leaving for another opportunity.
Acadia Pharmaceuticals (ACAD) announced Catherine Owen Adams has succeeded Steve Davis as CEO.
Culling the Herd:
IGM Biosciences (IGMS) announced a strategic pivot to focus on autoimmunity. The CEO, CSO and CMO will be stepping down in conjunction with a reduction in force to extend the current cash runway to 2027.
Bluebird Bio (BLUE) is reducing headcount by 25% in an attempt to reach cash flow breakeven by 2H 2025. BLUE successfully developed three gene therapy products (Lyfgenta, Zynteglo and Skysona), but racked up accumulated deficit of $4.5 billion in the process. The current market cap of <$100 million reflects concerns for the ultimate commercial potential and potential need for additional capital.
Fulcrum Therapeutics (FULC) announced a ~40% workforce reduction.
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