The mood on the first day of the BIO CEO & Investor Conference in New York was one of cautious optimism. Tasked with the goal of looking for potential deals, many of the 1,400 attendees who showed up at the Waldorf Astoria on Monday had already had several meetings by the time the first therapeutic session started at 8 am.
While BIO CEO provides an opportunity for meetings between attendees—including large biopharma companies, smaller biotechs, investment firms, venture capitalists, research analysts and patient-advocacy groups—therapeutic panels are also an important part of the overall offering.
Here's what you need to know out of the event's first day.
The role of therapeutic panels at a deal-making event
These discussions provide important updates from different players in a specific therapeutic space on the state of the science, as well as the current challenges and opportunities.
They also provide a context for understanding advances in a therapeutic area, a necessary foundation to pursuing a deal with companies working in that space.
Yesterday, the morning therapeutic panels focused on oncology and ophthalmology, with an additional afternoon panel focused on Alzheimer’s disease.
Insights from the M&A business session
Without a doubt, “M&A in Overdrive: Deal-Making and Merger Integration Success Factors” proved to be the most popular session of the day. Panelists from AbbVie, Purdue Pharma, Contravir Pharmaceuticals and the venture group New Enterprise Associates weighed in on everything from finding deals and defining milestones, to creative ways for structuring deals in a down market.
When the first BIO CEO meeting was held in New York City in 1997, biopharmaceutical M&A was a very different game. The culture of deal-making then was all about market share, according to James Sapirstein, CEO of Contravir. Companies would hunt for deals to shore up specific therapeutic areas, aiming to dominate that space.
2015 is a very different story, however, he said. “Today is a lot different than the 1990’s in the sense that deals are much more targeted and strategic in a different way.”
Purdue is looking for deals
While the M&A landscape has changed, the hunger for deals persists. Mark Timney, CEO of privately held Purdue Pharma, came to BIO CEO looking for opportunities.
As Timney told the audience, “We are focused on pain, but I plan to diversify our portfolio. My goal this year is at least one transformative deal so that I can diversify our portfolio in some way, shape or form.”
“And then I plan to do follow-up deals. I don’t see this as a one and done situation. We want to do two, three, four deals per year for the next several years.”
AbbVie looking to benefit from the market decline
Henry Gosebruch, Chief Strategy Officer at AbbVie, was just as optimistic about opportunities in the current market. “We’re very excited,” he said. “There are a lot of opportunities out there. Lots of small companies that didn’t see the bubble bursting, so they’re out of cash.”
“Many of the smaller companies in this situation don’t want to be acquired by large pharmas at their current valuations—so then they come to a company like mine for a deal.”
BIO welcomes Senator Chuck Schumer
One of the highlights of day one was a “fireside chat” added as an addendum to the schedule—much to the surprise of attendees. Ron Cohen, the chair of BIO and CEO of Acorda Therapeutics, sat down with Senator Charles Schumer (D-NY) shortly after lunch to discuss the intersection of the biopharma industry with current political realities.
Schumer is clearly an ally of the biopharma industry. During his discussion, Schumer cited the industry as an example of American entrepreneurship—and an important conduit for strengthening the economy and creating jobs.
“Since 2001, median income is down between 8% and 9%. The number one concern in America is job creation,” he said.
When the drug-pricing debate was brought up, Schumer said Martin Shkreli is an example of a "bad apple" who should be condemned by the industry. He applauded BIO's decision to eject Turing Pharma and Shkreli three days after the story about the Daraprim price hike broke last fall.
Up with the NIH, down with inter-partes review
After Dr. Cohen lauded Schumer for the role he played in helping get the R&D Tax Credit and the American Jobs Act passed, Schumer said more needs to be done.
In short order, Schumer mentioned increasing NIH funding, supporting start-ups with more tax breaks early on, revamping the inter partes review (IPR) process, and international tax reform. He referred to the IPR process as a thorn in the industry's side although it was initially conceived as a way to prevent patent trolling.
Bipartisan progress could yield more NIH funding
Schumer emphatically reiterated the need for additional funding for NIH above and beyond the $2 billion recently approved by Congress—a coup that Schumer attributed to improving bipartisan relations.
Congress has been gridlocked legislatively for much of the past five years. But, "at the end of 2015 something magical happened,” he explained. As the election cycle has geared up, mainstream Republicans began seeing Tea Party members as a liability, in Schumer's view.
Due to this improved dynamic, Schumer is optimistic more funding may be forthcoming. Ideally, he said, the best outcome would be permanent funding over a period of years.
What about the Cancer MoonShot?
Ending on a hopeful note, Schumer spoke on the Cancer Moonshot initiative. “We understand cancer so much better than just 10 years ago. Will we achieve the goals of Cancer Moonshot by 2020? I don’t know, but I think we could achieve these goals within our lifetimes.”