The third day of the J.P. Morgan Healthcare Conference was, in typical fashion, quieter than those before it. With most of the scheduled company presentations complete, many attendees were wrapping up private meetings outside the halls of the Westin St. Francis Hotel, which was noticeably less crowded.
Not infrequently, those external meetings provide the foundation for some of the industry’s most noteworthy deals and partnerships. Just a few years ago, for example, JPM served as the catalyst for what would become a research pact worth billions of dollars, between Gilead Sciences and the Belgian biotechnology company Galapagos.
Investors may be hoping so after further dealmaking didn’t follow the trio of acquisitions announced at the conference’s start. More rain and clouds didn’t boost attendees’ sentiment, either.
For Takeda, however, this year’s meeting provided a chance to talk up the multibillion-dollar deal it signed last month and that it hopes will help it take on a formidable rival.
Takeda comes after Sotyktu
Last September, Bristol Myers Squibb brought a new type of autoimmune drug to market with big expectations. Called Sotyktu, it’s the first TYK2 inhibitor, medicines that are oral alternatives to top-selling injectable medicines.
Approved for plaque psoriasis, Sotyktu is being studied for other conditions like inflammatory bowel disease. Those trials are critical to Bristol Myers’ lofty sales projections for Sotyktu, and could help keep the company ahead of competitors.
“The first-mover advantage is a big advantage,” said Bristol Myers’ chief medical officer Samit Hirawat. “It’s incumbent on everybody else to show superiority.”
Takeda, Bristol Myers’ closest challenger, is adamant it will. Last month, the Japanese pharmaceutical giant paid $4 billion to acquire a drug from Nimbus Therapeutics that’s currently in mid-stage testing in psoriasis. The drug is more selective than Sotyktu, its proponents claim, suggesting dosing could be safely cranked up higher than with Bristol Myers’ medicine.
“It looks like not just best-in-class relative to [Sotyktu], but, I think, best-in-class relative to the entire space,” said Takeda’s R&D chief Andy Plump. “We feel pretty confident it's the best molecule out there.”
Plump noted that Takeda wasn’t alone in its assessment. Nimbus privately shared results from the Phase 2 psoriasis study with a number of companies late last year, kickstarting what Plump called a “highly competitive” bidding war.
“We were really close to not getting that deal,” he said, adding that, while other TYK2 blockers are in development, they are “early with very little data.”
Nimbus will detail the Phase 2 results in March. Already, the findings have given Takeda confidence to consider testing Nimbus’ drug directly against Sotyktu in psoriasis, start trials in lupus and inflammatory bowel disease, and potentially explore its use in multiple sclerosis and other conditions, Plump said. — Ben Fidler
Prime ponders a spin-off
In a tough year for biotechs going public, Prime Medicine was an outlier. The company launched in July 2021 with $315 million and pivoted to an initial public offering 15 months later, the type of quick turn that biotechs have had a hard time pulling off recently.
CEO Keith Gottesdiener attributes that success to an “excitement” among investors about gene editing — specifically the precise form of it, known as “prime editing,” that Prime is developing.
“Many, many investors said to us, whichever way you go, [staying] private or [going] public, we'd like to own a piece of Prime Medicine,” he said. “We said if we're going to do this anyway, and we know that we can get it done now, let's just get it done and get out into the public market.”
An IPO only gets a biotech so far, though. Prime now has to show it can make progress with its medicines, even though it’ll likely be at least a year before it asks regulators to start its first human trials. It also has to figure out which of its drug programs — the company has disclosed 18 publicly, but has others as well, according to Gottesdiener — to invest in.
That leaves Prime with tough decisions ahead. Gottesdiener acknowledged the company can’t do everything. One way around that constraint is forming partnerships with larger drugmakers. Another is to spin some of its programs into a new company, raise money and “let somebody else worry about bringing them forward,” he said.
Such a decision is likely more than a year away, according to Gottesdiener, as the company is only starting to “dip its toes” into business development and figure out what to do with some of its programs. But a spin-off is “something that we’re giving consideration to,” he said.
“Is it going to work? Are we going to do it? I don’t know for sure,” he added. — Ben Fidler
Still in: genetic medicine
Even beyond Prime, there appears to still be investor appetite for investing in genetic medicine.
Since the FDA approved the first gene therapy for an inherited disease, many of the world’s largest drugmakers and healthcare venture funds have invested in gene replacement therapy and, more recently, gene editing.
Despite enduring safety questions and a few bumps in the research road, investors are encouraged by the versatility of new gene editing approaches.
“Gene editors have a lot of reusable components,” said Vijay Pande, a general partner at a16z. “It’s not like you design one editor and sell it off to pharma A, and then come up with a whole new editor for pharma B. You can reuse everything except the guides.”
In theory, that means companies can get a drug candidate into the clinic more cheaply and quickly, Pande said. It also opens more doors for dealmaking.
One big problem still stands in the way: getting therapies to where they’re needed in the body. Genetic medicines often end up in the liver, while reaching other organs is a harder task. A number of companies are working on the challenge and, if successful, could expand the range of diseases that can be treated with gene replacement and editing therapies.
“Gene therapy has been a little bit maligned, but we're seeing some incredible efficacy,” said Chris Bardon, co-managing partner at BioImpact Capital and portfolio manager at MPM Capital. “There’s still incredible promise.” — Gwendolyn Wu
Sanofi is not scared of Roctavian
The French pharmaceutical giant Sanofi earns about 10% of its sales on treatments for rare diseases like hemophilia, for which the company has two approved products.
But over the past decade, the market for hemophilia drugs has become crowded. The FDA has approved well over a dozen medicines that keep the bleeding disorder in check. One of the newest options, Hemlibra, can be administered as infrequently as once a month.
As such, developers in the space have sought to design more effective and longer-lasting lasting options. Some are working on gene therapies that could be one-time fixes for hemophilia. Late last year, the FDA for the first time approved one of these therapies, CSL’s Hemgenix, and is expected to soon issue a verdict on another, BioMarin Pharmaceutical’s Roctavian.
While gene therapies for hemophilia have attracted much attention, Sanofi’s leadership appears to view the technology as nascent, with questions still outstanding about long-term safety and durability.
“Our view is that this version of gene therapy, call it 1.0, just doesn't meet the mark,” said Bill Sibold, head of Sanofi’s specialty care business, in a meeting with reporters Wednesday.
Perhaps that view is to be expected, as Sanofi is nearing the finish line on two new, non-gene therapy options for hemophilia. One, called fitusiran, is in late-stage human testing, while the other is under review at the FDA, which should make an approval decision by late February. If cleared for market, that latter drug would be sold under the brand name Altuviiio and come as a once-weekly intravenous injection for the more common, “A” form of the disease.
According to Sibold, these types of drugs are likely more attractive to the majority of hemophilia patients and healthcare providers.
“Gene therapy, where does it play?” he said. “[I’m] not so sure, in at least hemophilia A, that that’s going to be where you [will] hear a lot of people going. We’ve heard that from the physician community and patient community.” — Jacob Bell
Ionis’ road to profitability
Ionis Pharmaceuticals began the new year by signing a “strategic” partnership with Royalty Pharma that it says will help further its genetic medicines research.
Royalty paid Ionis $500 million upfront for part of Ionis’ royalty rights to Biogen’s spinal muscular atrophy drug Sprinraza, and the experimental heart disease drug pelacarsen, which Novartis licensed in 2019.
Ionis could receive up to $625 million more in milestone payments related to pelacarsen, which Ionis CEO Brett Monia described on Wednesday as “achievable.”
The deal, Monia said, should help Ionis continue its transition into a biotech capable of launching and commercializing its own products, such as three that are now in late-stage testing.
“The timing is right for this,” he added. “We're in a period in which we're launching our own products. What comes with that is the need for capital.”
The deal gives Ionis a cash position of about $2.5 billion, according to Monia.
“There are no plans right now to further monetize anything in our pipeline,” he said. “This transaction might get us to a position in which we no longer need to finance the organization, to get us to sustainable profitability.” — Delilah Alvarado