Sweat Equity - Your Weekly Biotech News Fix | Ep. 547
The Week of January 6th
Hello Avatar! Another week of biotech news is in the history books. We are proud to bring you the latest edition of Sweat Equity, our weekly biotech news fix. The content is designed to be consumed as a quick scroll to bring readers up to speed on key events from the week. For those of you interested to read a bit more, we provide links to the source articles.
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BIOTECH NEWS UPDATES FOR THE WEEK 1/6
Navigating future biopharma catalysts: What to expect at the 2025 J.P. Morgan Healthcare Conference
The J.P. Morgan (JPM) Healthcare Conference is a key event for the healthcare sector, drawing over 8,000 industry leaders, emerging innovators, and influential investors. Taking place annually in San Francisco, the four-day conference provides a primary platform for companies to present their yearly visions, showcase new products, and announce significant deals. Attendees, both physical and virtual, keep a keen eye on major announcements and emerging narratives to help inform investment decisions and to provide a valuable insight for portfolio growth, given that the conference provides a comprehensive view of the industry's direction into 2025 and beyond.
Key areas to expect at the 2025 JPM Healthcare Conference are innovative therapies and technologies, with gene editing, AI-driven diagnostics, and unique drug delivery systems to be in the spotlight. Companies' presentations are often kept confidential until the conference, but one anticipated highlight is Anavex Life Sciences Corp’s presentation of Phase 2/3 data of their drug intended for the treatment of mild to moderate Alzheimer’s Disease. In addition, the conference saw over $8.205 billion in confirmed deals in 2024, a significant increase from the $2.65 billion announced in 2023. This trend reflects a growing focus on innovation and competitive positioning that is expected to continue into 2025. Upcoming sessions also aim to navigate anticipated healthcare regulatory changes due to a new administration assuming office in the U.S.
Pharmas Turn to Licensing Deals as Risky Science Rises
The biotech industry is increasingly leaning towards licensing deals as drug development becomes riskier with ventures into more complex biology and advanced technologies. In a post-pandemic market that is more risk-averse than ever, larger pharmaceutical companies are delegating risk to smaller firms through minor upfront licensing deals with a potentially substantial payoff, given the progression goes as intended. These strategies are emerging as the preference over transformative M&As in the currently restrained biotech market, with a detectable sense of urgency observed among biotechnology leaders to secure deals.
In a typical licensing agreement, pharmaceutical companies pay a modest upfront fee, then fortify the deal on the back end with payments for development, regulatory and commercial milestones. Despite the potential for these milestones to accumulate into billions, upfront fees typically fall below $100 million, and the entirety of the additional cash is seldom paid out. This structure effectively shifts most of the risk back onto the firm innovating, making these licensing deals an appealing option for pharmaceutical companies. Upfront payments are slowly growing, according to GlobalData, increasing 137% or $55 million on average from 2021 to 2024.
Healthcare venture capital investment boosted by AI in 2024: report
Venture capital investment in the healthcare sector increased in 2024, with a particular surge in funding for startups utilizing artificial intelligence, says a report by Silicon Valley Bank. Last year, funding for U.S. healthcare companies reached $23 billion, up from $20 billion in 2023, with close to 30% of this investment directed towards AI startups. The report also predicts that there could be a 'steady yet modest' rise in deal value and volume across the healthcare sector in the coming year.
Investment in healthcare companies, including those developing drugs, healthcare technology, diagnostics tools, and medical devices, is still lower than the pandemic-era funding peak, based on the Silicon Valley Bank report. However, 2024 surpassed 2021 in terms of the number of venture capital deals, and healthcare investment overall has grown by 44% since the start of 2020. AI has played a significant role in driving healthcare investment, especially beneficial for biotech startups using the technology to help discover new drugs and inform clinical trial design. Meanwhile, funding for health tech startups has slowed, declining from $15.4 billion across nearly 1,200 deals to $10.6 billion across 706 deals.
A Cautiously Sunny Outlook for Biopharma in 2025
The Biopharma industry is looking at a cautiously optimistic outlook for the year 2025, with an expected resurgence in investment driven by lower interest rates, a renewed focus on late-stage assets, oncology, and the use of artificial intelligence (AI). The industry is predicted to recover from a prolonged downturn experienced between 2020 and 2022 due to the financial bubble caused by the COVID-19 pandemic. There was a significant increase in mergers and acquisitions (M&As) and initial public offerings (IPOs) in early 2024, signaling a promising recovery for the sector. In addition, the federal reserve's decision to cut interest rates throughout 2024 has enhanced optimism and fueled investment in startups, an indication of the sector's revival after several challenging years.
The second half of 2024 saw a hike in private financing, with over 50 companies announcing $100 million-plus in private equity financing rounds. According to UBS Investment Bank, biotech follow-on issuance activity increased by 64% compared to that in 2023. The overall transaction volume surpassed the totals of the last five out of six years. Although the sector has not yet fully reached the pre-pandemic investment levels, continued increase in activities may lead to achieving this milestone in 2025. The expected Trump administration will likely show a more favorable attitude towards M&As compared to its predecessor. However, the year will likely highlight the disparity between successful and struggling early-stage biotech companies.
Galapagos, after research struggles, will split in two and revamp Gilead deal
Belgian biotech company Galapagos plans to divide into two public entities and amend its existing arrangement with Gilead Sciences, in response to recent research setbacks. The new subsidiary, tentatively named SpinCo, will operate with a 2.45 billion euro (approximately $2.5 billion) purse to build an oncology, virology, or immunology management pipeline via transactions. Meanwhile, Galapagos will focus on advancing its cell therapy pipeline and lead CAR-T candidate, GLPG5101. Following the reshuffle, Galapagos and Gilead will modify their 2019 licensing and development deal which will result in Gilead owning approximately 25% of both companies, returning development and commercialization rights to Galapagos, but retaining rights to receive royalty payments.
Galapagos, which has faced a significant decline in its American depositary receipts in recent years, hopes the split will resolve the problems it's been experiencing in business development, a situation made worse due to its focus on CAR-T, challenging deal-finding, and the requirements of the Gilead collaboration. However, concerns remain whether the structural change will improve business prospects for SpinCo. Despite the potential upsides of this strategy, fundamental issues that previously hampered Galapagos could still apply. Gilead will maintain option rights to any medications developed by SpinCo and has the right to name directors to the new company’s board.
Kidney disease drugmaker Maze files for IPO
Maze Therapeutics, a California-based biotech firm specializing in kidney disease drugs, has filed for an initial public offering (IPO) after securing about $500 million in private investment. Depending on the speed of the agreement, Maze's IPO could be the first within the biotech sector this year, continuing a trend favoring biotechs with drugs in clinical testing. The company’s leading program is MZE829, a small molecule inhibitor targeting APOL1, showing promising results in Phase 1 and has already begun Phase 2 trials.
MZE829 is expected to rival Vertex Pharmaceuticals’ drug inaxaplin, currently in Phase 3, for treatment of APOL1 kidney disease as preclinical models suggest it could be a more potent and broad-ranging treatment. Maze has a second kidney disease drug, MZE782, in Phase 1 trials, with results expected in 2025. In addition, MZE782 is under investigation as a potential therapy for phenylketonuria, a rare genetic disorder. The firm's performance could provide an overview of how biotech IPOs will fare in 2025 as pricings have maintained a low pace since 2022. Maze has raised approximately $500 million in private funding since its launch in 2019.
Gene Therapy Space Hit With Layoffs as Resilience, Scribe Cut Staff
2024 saw a protracted wave of layoffs within the biotech industry, with several pharmaceutical giants, including Johnson & Johnson and Bristol Myers Squibb, making significant job cuts. Into 2025, this trend continues with Scribe Therapeutics and Resilience scaling down their respective workforces. Scribe is preparing to ax approximately 20% of its staff as it braces for clinical studies. The company, co-founded by Nobel Laureate Jennifer Doudna, employs proprietary CRISPR-based drug design and development platforms. Its pipeline includes therapies for hyperlipidemia (STX1100), severe hypertriglyceridemia, familial chylomicronemia syndrome (STX1400), neurological diseases, and cancer.
On the other hand, San Diego-based Resilience is set to lay off 120 employees at its Research Triangle Park gene therapy facility in Durham, North Carolina. The layoffs were made effective as of December 15, as detailed in a Worker Adjustment and Retraining Notification Act warning notice. It’s unclear what necessitated these job cuts, but the news represents a visible downturn within the gene therapy space. Unmistakably, economic pressures and advancing drug development initiatives are driving workforce readjustments in the biopharma industry.
CytomX to Cut 40% of Staff as It Updates Pipeline Priorities
Biotech firm CytomX is set to cut approximately 40% of its staff with the aim to refocus resources on its clinically owned programs, primarily the antibody-drug conjugate CX-2051 aimed at advanced metastatic colorectal cancer. Situated in San Fransisco, CytomX announced this restructuring decision on January 6. By implementing workforce cuts, the company is seeking to direct funding towards its clinical programs and facilitate greater flexibility in its cost structure. On December 31, 2023, the company reportedly had 120 employees, but with the proposed cuts, this figure is expected to drop to less than 75.
While CytomX's primary strategic objective is geared towards the development of CX-2051, the company will continue its partnership with biotech giants such as Amgen, Astellas, Bristol Myers Squibb, Moderna, and Regeneron. The biotech firm, however, expressed uncertainty over the future of CX-904, a T-cell-engaging bispecific antibody being developed in partnership with Amgen. Plans regarding Phase Ia completion and progression to Phase Ib are subject to ongoing evaluation due to the company's current economical constraints. CytomX experienced a critical setback in the previous year when it suffered a 20% premarket trading drop following the discontinuation of a program in partnership with BMS. Reductions in workforce, primarily affecting early nonpartnered research and administrative functions will be completed by the end of the first quarter, as the company implements cost reductions and prioritizes focused clinical development.
From Bad to Worse: 3 Ways Biopharmas Make Layoffs More Painful for Employees
The article discusses three paramount mistakes biopharma companies are making during employee layoffs which worsen the situation for employees. The mistakes highlighted have been identified by four biopharma professionals who have requested anonymity. These include a lack of transparency around financial issues, the absence of severance packages, and a lack of support for terminated employees to find their next roles. Based on the BioSpace workforce planning survey, 21% of the participating companies anticipate making layoffs in 2025. In the previous year, nearly 24,000 jobs were cut in the pharma and biotech industry.
One of the main issues for employees being laid off was companies not being transparent about financial problems leading to sudden layoffs. For instance, an anonymous respondent recounts her sudden layoff following a high-performance review and bonus from a small biotech company. She revealed that the abruptness and secrecy of the layoff process created confusion and surprise, without an explanation about why the presence of these financial problems was hidden from employees. The lack of transparency not only harms those being laid off but also affects the remaining employees and overall company integrity.
5 questions facing pharma in 2025
The election of President-elect Donald Trump has provoked uncertainty within the biopharma industry. Trump's unorthodox nominations for key healthcare roles and potential support for policies that could disadvantage drugmakers are adding to the industry's apprehension. This political risk is coming at a challenging time for the industry—the industry is already dealing with broader economic issues such as monetary policies, tariffs, and healthcare reforms.
Several therapeutic trends are predicted to shape investment and market dynamics in 2025, with a particular emphasis on metabolic and immune diseases. Key questions revolve around the regulatory impact of the Trump administration and upcoming price negotiation target announcements for drugs in the Medicare program. Many expect the Centers for Medicare and Medicaid Services to reveal the list of targeted drugs prior to Trump’s inauguration. Trump’s potential action on the Inflation Reduction Act and Medicare drug pricing are uncertain, adding to the overall uneasy climate in the pharmaceutical landscape.
IGM’s autoimmune pivot backfires as top drug disappoints in testing
IGM Biosciences recently announced its decision to discontinue the development of its leading experimental drugs, imvotamab and IGM-2644, which were being tested for autoimmune conditions. The decision was made after the company discovered that imvotamab was unable to deplete B cell counts effectively to meet its therapeutic goal in an early-stage test for lupus and rheumatoid arthritis. Following poor results, the biotech company also plans to lay off 73% of its staff and consider possible strategic alternatives to preserve cash.
This announcement follows IGM's strategic pivot towards autoimmune disease research in 2024, following trends in the biotech industry that highlighted the potential of cellular medicines for autoimmune diseases such as lupus. IGM, among other biotech companies like Cullinan Therapeutics and Candid Therapeutics, aimed to prove that dual-targeting antibody drugs, such as T cell engagers, could be effective and more practical. The optimistic expectations surrounding imvotamab were based on preclinical and early clinical data suggesting that the drug could potentially outperform rituximab. However, the recent results indicate that the company's efforts in pivoting towards autoimmune disease research have not been successful, leading to a major restructuring of its workforce and business strategy.
The Megaround Ruled Biopharma in 2024 as First-Time VC Funding Doubled
In 2024, the biopharma industry saw a significant rise in initial rounds of venture capital (VC) financing, reaching a total of $7.7 billion across 137 deals, in comparison to the $3.8 billion from 156 deals in 2023. This considerable increment was largely attributed to the domination of 'megarounds' of first-time financings, with seven rounds exceeding $300 million, contributing to doubling the overall figures from the previous year. Biopharma AI company Xaira Therapeutics stood out with an exceptional $1 billion raised, as part of the 14 mega-rounds of $100 million or more that took place in the first half of the year, when the more significant venture activity occurred.
In the second half of the year, however, only six first financings managed to surpass the $100 million mark. HSBC identified an additional five series A financings that went beyond the megaround threshold, collectively amassing $650 million, though these were not part of their main analysis. Many of these high-earning financings were led by well-known managers from previously bought-out successful firms. According to HSBC, investors who commit significant upfront funds to megaround raisers are likely to continue backing the veteran team, even if their initial objectives fail, due to their proven track record and the flexibility offered by substantial equity rounds to pivot if the initial technology fails.
Verdiva starts up with $411M and a portfolio of obesity drugs from China
Verdiva Bio, a new startup that has commenced with a remarkable $411 million in funding and three weight loss medicines licensed from China-based Sciwind Biosciences, aims to bring significant advancements in obesity treatments. The company's Series A financing, led by Forbion and General Atlantic, recorded the third-largest funding round since the outset of 2022. The newly established pharmaceutical company also named a rich management team, led by former Aiolos CEO Khurem Farooq. Other top-tier executives have expertise from their tenure at Aiolos, including Chief Scientific Officer Jane Hughes, Chief Business Officer Tapan Maniar, and Chief Technology Officer Ashley Taylor.
The promising new platform joins the expanding group of obesity drug startups like Metsera, Antag Therapeutics, SixPeaks Bio, Pep2Tango Therapeutics, and Kailera Therapeutics striving for supremacy in the obesity drug market. The booming market which is currently dominated by Novo Nordisk and Eli Lilly has triggered a race among pharmaceutical companies to produce efficacious obesity treatments. Verdiva Bio is reportedly working on an experimental treatment which aligns with Novo's Wegovy and Lilly's Zepbound, planning to provide better treatment options for obesity.
Tenvie raises $200M for brain drug R&D; Sana spikes on single patient’s results
Tenvie Therapeutics, a new startup based in the San Francisco area, has recently launched with $200 million in funding. The biotech company, which is backed by Arch Venture Partners, F-Prime Capital, and Mubadala Capital, has been built around several drug assets acquired from Denali Therapeutics, with former Denali employee, Tony Estrada, at the helm. Tenvie's primary focus will be on developing programs that target two different types of proteins associated with neurodegeneration.
In other biotech industry news, Jasper Therapeutics recently unveiled results from a Phase 1b/2a study on its antibody drug, briquilimab. This drug, which was tested on patients with a type of hives known as chronic spontaneous urticaria, has shown to help reduce the severity of hives and itchiness, although three patients did experience neutropenia. Meanwhile, Sana Biotechnology saw a tripling of its shares after the company announced successful results in transplanting pancreatic islet cells into a patient with Type 1 diabetes without needing to use immunosuppression. This marks the first instance of an allogeneic transplant surviving without immune protections, and was achieved using "hypoimmune" technology developed by Sana that produces cells capable of bypassing detection from the body's immune system.
ALS drugs from Denali, Calico come up short, marking setback for Healey trial
The Healey platform trial experienced a setback, with ALS drugs developed by Denali Therapeutics and Calico Life Sciences falling short in performance against a placebo in slowing the progression of the nerve-destroying disease. High-level results from Denali indicated that after six months, their drug had not made a significant impact on the disease severity or substantially improved patients’ muscle strength or respiratory function. Similarly, the Healey center announced that a medicine developed by Calico and AbbVie had also underperformed.
Despite these initial clinical trial failures, the data collected is expected to inform the next stage of ALS research and impact future trial design. Denali plans to further scrutinize the data and pay special attention to ALS’s biological markers, and will conduct these analyses later this year. Both Calico’s and Denali’s drugs are designed to activate eIF2B, a complex molecule used by cells to make proteins. Though it is generally beneficial, under specific conditions, it can contribute to the exacerbation of TDP-43's accumulation, a stress-related protein linked with ALS and other neurodegenerative diseases.
Vertex, startup Orna to partner on gene editing research
Vertex Pharmaceuticals and Orna Therapeutics announced a partnership to develop new methods of delivering gene editing therapies to people with severe blood disorders such as sickle cell disease and beta thalassemia. Over the next three years, the two companies will collaborate on using Orna’s lipid nanoparticle technology to develop in vivo gene editing therapies. As part of the agreement, Vertex will pay Orna $65 million upfront, including an investment via a convertible note. Additionally, Orna stands to receive up to $635 million in milestone payments related to work involving the two blood diseases. Vertex, which markets the CRISPR therapy Casgevy, has been looking for ways to improve the treatment.
Casgevy's approval was a significant milestone for Vertex and its partner, CRISPR Therapeutics. However, the rollout of this gene editing therapy has been slow due to the complexity of the treatment, its cost, and concerns about its side effects. The therapy involves extracting patient stem cells, editing them in a central laboratory using CRISPR, and then re-infusing the modified cells back into each patient — a complicated process that can take several months to complete. An in vivo approach, which would entail editing stem cells while they remain inside the body, could simplify this process. Orna's lipid nanoparticles, designed to reach tissues outside the liver, may offer a solution to this logistical challenge.
Metsera reveals data supporting long-acting obesity shot
Biotech startup, Metsera, has announced encouraging Phase 2 trial results for its long-acting GLP-1 shot aimed at helping individuals who are overweight or have obesity. The experimental drug, known as MET-097i, enabled trial participants to lose an average of 11% more body weight compared to placebo recipients over a 12-week period. Those who received the highest dosage experienced placebo-adjusted weight loss of around 20%, similar to recorded data from Eli Lilly’s Zepbound and Novo Nordisk’s Wegovy treatments over comparable periods. Furthermore, Metsera intends to test the drug as a monthly injection, which is less frequent than the weekly administrations required by both Zepbound and Wegovy.
Incretins, such as Metsera’s experimental drug, are gaining increasing interest in the biotech sphere due to their ability to facilitate substantial weight loss and potentially prevent heart-related issues and treat other associated conditions. Wall Street analysts suggest that these treatments could generate more than $100 billion in yearly sales in the upcoming decade. However, current medicines in this domain are imperfect, requiring weekly injections to maintain weight loss, alongside potential gastrointestinal side-effects. Observations from recent medical records show that 50% of patients using these drugs for obesity treatment discontinue their use within a year, and as many as 85% cease usage within two years. Consequently, multiple pharmaceutical companies are seeking to improve upon existing drugs such as Wegovy and Zepbound, either developing oral versions or extending the duration of effectiveness.
Orbis raises $93M to turn popular biologics into pills
Orbis Medicines, a European biotech startup, has generated approximately $93 million in a Series A funding round. The funds will primarily be used to progress the development of oral peptide drugs. Known as "macrocycles", these medicines have the potential to harness the efficacy of both small molecule and biologic drugs. Orbis is committed to creating oral macrocycles that act against disease targets which have already been validated by successful injectable medicines, although the specific targets have not yet been disclosed. The company, which was incubated by Novo Holdings and emerged from stealth mode only last year, was co-founded by Sevan Habeshian and Christian Heinis.
Biological medicinal products, or biologics, represent an increasingly important segment of pharmaceutical research, with a potential market value of around $521 billion by 2024, and expected to more than double by 2034. Despite their potential, current delivery methods for such products, such as injections or infusions, can be inconvenient when compared to orally administered small molecule drugs. Therefore, Orbis' development of oral macrocycles could provide a significant advantage, enhancing patient adherence and convenience. Macrocyclic peptides, in particular, hold promise, and have gained increased interest recently.
Roche Nears Completion of Poseida Acquisition Worth Up to $1.5B
Pharmaceutical giant Roche is nearing the completion of the acquisition of Poseida Therapeutics in a deal expected to close in Q1 2025. The deal, which will see Roche gain access to Poseida's off-the-shelf CAR T candidates, involves Roche accepting almost 65 million shares for a cash payment of $9 per share, alongside an additional contingent payment of up to $4 per share, totaling an estimated worth of $1.5 billion. The purchase gives Roche about 66% of Poseida.
Roche's acquisition builds on a 2022 agreement with Poseida, which saw it pay $110 million up-front and promise up to $6 billion in milestones to advance allogeneic CAR T therapies for certain blood cancers. The focal point of the deal is P-BCMA-ALLO1, a candidate designed to target the BCMA protein commonly found on the surface of cancerous plasma cells. Roche's acquisition is still subject to regulatory, antitrust clearances, and other standard closing conditions. But, with both boards pledging unanimous support, the acquisition seems imminent.
Computational Biology, Data Science Hot Areas for Oncology R&D Hiring
Computational biology and data science are becoming increasingly important fields in the realm of oncology research and development (R&D), as reflected in the hiring trends of biopharma companies. According to a recent BioSpace workforce planning survey, 60% of industry respondents anticipate hiring in R&D in 2025, largely for positions related to computational biology and data science. Additionally, the oncology space was highlighted as an area of high demand. Conor Sullivan, head of talent acquisition at Harbinger Health, reinforced this trend, pointing out a growing demand for more computation-focused roles within the biotech industry.
Artificial intelligence, structured language, and Python are among the skills expected to be essential in R&D by 2025. Harbinger Health is focusing on roles that combine computational biology and data science with machine learning, seeking professionals with a good, broad base of knowledge that enables them to use off-the-shelf tools to expand their data analysis capabilities. Positions spanning computational biology, translational data science, and principal data science roles in the oncology space have been listed by several companies, including Amgen and AbbVie, reflecting the industry's growing demand for these specialized skills.
Lilly Partners With a16z on $500M VC Fund for Early-Stage Biotechs
Eli Lilly has partnered with venture capital firm Andreessen Horowitz (a16z) to set up a new $500 million biotech fund aimed at supporting potentially disruptive science and ambitious leaders in the industry. The fund, known as the Biotech Ecosystem Venture Fund, hopes to bring together a16z's ability to source capital and Lilly's R&D expertise. However, specific disease areas have not been finalized. Lilly will provide all the capital for the fund and will also open up access to its Catalyze360 program which offers support to early-stage biotech companies.
The Catalyze360 program was designed to boost the success rate of emerging biotech startups by giving them access to resources typically not accessible by such firms. By investing in the Biotech Ecosystem Fund, Lilly plans on expanding its work to empower entrepreneurs and fast track the development of transformative therapies for patients. The partnership between a16z and Eli Lilly is expected to provide startup founders with both venture backing needed for technological advancements, and the resources needed to select the most promising application areas.
Patrizia Cavazzoni, key FDA official, to leave agency
Patrizia Cavazzoni, director of the Food and Drug Administration's (FDA) primary drug review office, is set to leave her role on January 18th. Her impending exit follows departures from several other senior FDA figures in advance of the incoming Trump administration. Namandjé Bumpus, formerly the agency's principal deputy commissioner, left at the end of last year, and FDA veterans Douglas Throckmorton and Robert Temple have also retired. Cavazzoni’s departure was confirmed through a staff email.
A trained physician, Cavazzoni joined the FDA seven years ago. She led the Center for Drug Evaluation and Research starting from 2021, after succeeding Janet Woodcock. Prior to her stint at the FDA, she had roles at Eli Lilly, Sanofi, and Pfizer. The staff changeover amid administrative shifts is usual, although the President-elect has hinted at future disruptions for health regulation agencies. Trump’s chosen leader for the Department of Health and Human Services, Robert F. Kennedy Jr., has indicated he believes the FDA requires substantial modification and has criticized it as corrupt.
Pfizer’s PD-1 drug succeeds; AbbVie writes down $3.5B in Cerevel assets
Pfizer's subcutaneous immunotherapy, Sasanlimab, demonstrated a beneficial impact on bladder cancer in testing, delaying death and disease progression in individuals with bladder cancer, longer than standard therapy alone. Tested alongside another immunotherapy, this could give Pfizer an advantage over competitors like Merck & Co.'s Keytruda and Bristol Myers Squibb's Opdivo, which have been approved for treating those with more advanced disease. Pending FDA approval, Sasanlimab would become the fourth PD-1 or PD-L1 inhibitor cleared as a subcutaneous injection as Roche's Tecentriq and Opdivo have already been granted similar approval, and Merck with positive Phase 3 data for an under-the-skin Keytruda.
On the other hand, AbbVie has announced an approximately $3.5 billion write-down pertaining to its acquisition of Cerevel Therapeutics, as per a new financial filing. The purchase, which completed last summer and amounted to $8.7 billion, had provided AbbVie with a range of experimental brain drugs, inclusive of one for schizophrenia which had promise. However, this drug has since experienced a severe clinical setback, which led to AbbVie losing more than $40 billion in market value.
Intellia to stop work on rare disease therapy, lay off staff
Intellia Therapeutics announced a major restructuring plan that involves discontinuing several research programs and laying off 27% of its staff. Key among the discontinued programs is NTLA-3001, a treatment for the rare lung disease alpha-1 antitrypsin deficiency that had recently entered Phase 1/2 clinical trials. As part of the restructuring, resources will be redirected towards the company's two most advanced experimental medicines. In addition, Intellia is preparing for a leadership change, with Laura Sepp-Lorenzino, the current chief scientific officer, set to retire at the end of the year, and her role to be filled by Birgit Schultes, the leader of Intellia’s immunology and cell therapy work since 2017.
This restructuring follows a similar move the previous year when the CRISPR gene editing company cut 15% of its workforce and paused several exploratory researches. Now, Intellia’s focus has shifted slightly, giving priority to clinical execution for their two main programs - NTLA-2002 and nex-z - which target the rare diseases hereditary angioedema and transthyretin amyloidosis respectively. Both these programs are now in Phase 3, and Intellia aims to accelerate enrollment for these trials and prepare for launching the medicines.
Lilly Makes $780M+ IPF Play with Mediar Partnership
Eli Lilly has entered into a $780M+ partnership with Mediar Therapeutics to develop a first-in-class therapy for idiopathic pulmonary fibrosis (IPF). The deal is centred around MTX-463, an anti-WISP1 antibody that aims to slow the progression of fibrosis, a characteristic of severe fibrotic diseases such as IPF. Eli Lilly will take responsibility for $99 million in upfront payment and near-term milestones, while the Boston biotech could be eligible for up to $687 million in further development and commercialization milestones. The partners intend to push MTX-463 into Phase II development, led by Mediar, in the first half of this year.
After successful completion of Phase II, Eli Lilly will assume responsibility for all further clinical development and commercialization activities for MTX-463. Early data from in vitro and mouse model studies suggests that inhibiting WISP-1, a protein typically associated with the severity of fibrotic diseases, could decrease fibrosis. Furthermore, a Phase I study showed that MTX-463 could reliably engage with WISP1 and interfere with its downstream signaling while maintaining a suitable tolerability profile. Alongside MTX-463, Mediar will independently develop its two other fibrosis programs, including the anti-EphrinB2 antibody MTX-474 and a SMOC2 program. Mediar expects to nominate a candidate for the SMOC2 program in the first half of this year.
MyoKardia Alumni Launch Kardigan with $300M to Tackle Heart Disease
MyoKardia alumni have launched a new biotech company called Kardigan, with an ambitious plan to make cardiovascular disease preventable and curable. Kardigan was introduced following the successful development of mavacamten and the sale of MyoKardia to BMS in 2020. The new entity has raised $300 million in a Series A round, led by Perceptive Advisors, ARCH Venture Partners and Sequoia Heritage. The firm aims to challenge cardiovascular disease, the leading cause of death globally, and is headed by former MyoKardia CEO, Tassos Gianakakos. The company, based in San Francisco and New Jersey, has a targeted approach to cardiovascular disease, and is working to better understand the mechanisms of its therapy candidates and individual patient responses to treatment.
The newly formed company is led by an executive team of MyoKardia veterans, including Jay Edelberg as Chief Medical Officer and Bob McDowell as Chief Scientific Officer. The team had previously paved the way for the development of mavacamten, a cardiac myosin inhibitor that specifically targets the source of obstructive hypertrophic cardiomyopathy, which was FDA-approved in 2022. Kardigan's focus will initially be on disease opportunities and patient segments that are resistant or poorly managed on current therapies, with an emphasis on primary and secondary cardiomyopathies leading to heart failure. The initiative follows recent advancements in the cardiovascular space, including the FDA approval of Attruby for transthyretin amyloid cardiomyopathy in November 2024.
Part D Drugs Almost Doubled in Cost Since Launch, Underscoring Importance of IRA: AARP
Medicare Part D drugs have nearly doubled in price since their introduction to the market, underscoring the need for pricing-control policies such as the Inflation Reduction Act (IRA), reports the AARP. Their research focused on the 25 branded drugs that incurred the highest spending in 2022 under Medicare Part D. Though the chosen drugs have not been through price negotiations, they were dispensed to over 7 million beneficiaries, totaling to almost $50 billion in spending. Price increases since market entry ranged from 0% to up to 293%, averaging a 98% increase. Over 40% of these drugs' current list prices was due to these price hikes since their launch, exceeding annual inflation rates.
This surge in prices not only increases government spending but also makes these treatments less accessible to patients, causing a potential fall in health results. The researchers emphasized the relevance of the Inflation Reduction Act, which allows the Medicare program to negotiate drug prices and impose penalties on companies that increase their prices faster than inflation. The IRA's long-term effect on drug price negotiation remains uncertain, according to the AARP. Nonetheless, they believe its implementation is critical considering the current state of prescription drug prices.
Novo Holdings invests in $200M Series A for Windward Bio launch to advance long-acting treatments for asthma and COPD
Novo Holdings, a leading life science investor, has invested in a $200M Series A launch financing for Windward Bio, a clinical-stage drug development company. Windward Bio is dedicated to improving outcomes for people suffering from advanced immunological diseases, primarily focusing on severe respiratory conditions for a start. The Series A financing, which was oversubscribed, saw participation from OrbiMed, Blue Owl Healthcare Opportunities, SR One, Omega Funds, RTW Investments, Qiming Venture Partners, Quan Capital, and Pivotal bioVenture Partners, alongside Novo Holdings. Windward Bio's flagship candidate drug, WIN378, acquired through in-licensing from Kelun-Biotech and Harbour BioMed, is a potential game-changer, long-acting monoclonal antibody that targets the ligand of thymic stromal lymphopoietin (TSLP) and has the potential to be administered every six months.
Windward Bio is onto preparing a Phase 2 trial to explore WIN378's potential in severe asthma, with initial clinical readouts due around 2026. Additional clinical trials are in the pipeline to address the unmet needs of nearly 5 million advanced, uncontrolled patients in US, Europe, and Japan suffering from asthma and chronic obstructive pulmonary disease (COPD). Simultaneously, Windward Bio is looking at building a discovery pipeline of long-acting bispecifics to potentially enhance disease efficacy for immunology indications. The Series A funding is dedicated to supporting the advancement of two undisclosed programs targeting New Drug investigative studies.
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