Confronted by complicated biology and repeated clinical trial failures, Bristol Myers Squibb and its peers chose to pour money into other, more attractive fields of research, like oncology and immunology.
But now, just a few years later, there are signs neurology is again a priority in some corners of the industry. New medicines for Alzheimer’s, ALS and depression have shown a path to market, and are ginning up enthusiasm among investors. Biotechnology companies like Neumora Therapeutics, Karuna Therapeutics and Cerevel Therapeutics have drawn big-name backers as they’ve moved promising brain drugs into late-stage testing.
“This is a repeated pattern that you see in the industry,” former Bristol Myers CEO Jeremy Levin told BioPharma Dive early in 2020. “People leave things alone, they think it’s a waste of time, waste of money. Then they see some success. The smart big companies dive in, buy the companies out or board with them, and the result is a complete break-open of the field.”
Read on for a closer look at how that pattern may now be repeating.
ALS drug approval sets new precedent for research field
The drug, which will be sold as Qalsody, is only for the estimated 300 or so ALS patients in the U.S. who have a specific genetic mutation linked to the disease.
By: Jacob Bell• Published April 25, 2023• Updated April 25, 2023
The Food and Drug Administration conditionally approved a new ALS medicine in an April 25 decision likely to influence how other experimental treatments for the nerve-destroying disease are tested and reviewed.
The medicine, known until now as tofersen, is only for ALS patients who have a specific genetic mutation. Estimates cited by the FDA hold that this group accounts for fewer than 500 of the roughly 30,000 people in the U.S with the disease.
Until tofersen, the few therapies that had secured FDA approval did so because they were shown to help patients live a bit better or a bit longer. Tofersen, which will be sold as Qalsody, is different. It failed the key clinical trial meant to demonstrate it can slow the functional decline associated with ALS, or amyotrophic lateral sclerosis.
Rather, tofersen’s approval hinged on its ability to lower levels of “neurofilament light chain,” a protein that’s drawn increasing interest from ALS researchers. It’s the first ALS drug approved based on so-called “biomarker” data, setting a precedent that could provide another, perhaps faster path to market for some developers.
“We believe this important scientific advancement will further accelerate innovative drug development for ALS,” Biogen said in a statement.
Created through a partnership between Biogen and Ionis Pharmaceuticals, tofersen is what’s known as an antisense therapy. If cells are like machines, then antisense drugs act as wrenches in the gears, halting the assembly of unwanted proteins. Tofersen specifically blocks the production of SOD1, a protein that, when mutated, is believed to give rise to ALS.
That key study supporting tofersen’s approval indicated the drug works as designed, with patients who received it experiencing significantly greater reductions in SOD1 compared to those who were given placebos. Treated patients also had substantial declines in neurofilament light chain. Research suggests this protein, when found at elevated levels in the fluid around the brain and spinal cord, is a sign of nerve damage. It is especially prominent in patients with ALS.
Still, tofersen did not meet the study’s main goal. After learning this in 2021, Biogen met with FDA staff multiple times to discuss next steps for its drug. The FDA says it encouraged the company to keep developing tofersen, but also cautioned that securing a full approval based on a single, failed trial would be challenging.
By the spring of 2022, Biogen had decided to use its neurofilament data to pursue “accelerated approval,” a type of marketing clearance given to drugs that the FDA believes are reasonably likely to benefit patients because of their effects on markers of disease. The agency agreed to review Biogen’s application, and initially said it would come to a verdict by Jan. 25, 2023 before extending its review by three months.
The tofersen saga put the FDA in a difficult position. The data backing the drug were mixed. But the agency had also acknowledged the dire need for new ALS drugs as, even with current interventions, most patients live just two to five years after being diagnosed.
Patient advocacy groups have also criticized the FDA, claiming it wasn’t working hard or fast enough to make more potential ALS treatments available to patients. They’ve pointed out how the agency granted accelerated approval to medicines with mixed track records that target other nervous system diseases, such as Biogen’s Aduhelm for Alzheimer’s disease.
Against this backdrop, the FDA in late March convened a committee of outside advisers to weigh tofersen’s pros and cons. While some committee members were hesitant to declare outright that tofersen is an effective treatment for ALS, they all agreed the drug’s effect on neurofilament light chain was “reasonably likely” to predict a clinical benefit.
To analysts, that conclusion raised tofersen’s chances of accelerated approval. Because while the FDA’s actions don’t always reflect the opinions of its advisers, they typically do.
Paul Matteis, an analyst at the investment bank Stifel, wrote in a note to clients after the meeting that the committee’s vote was also a “symbolically important test of the FDA's flexibility” toward new biomarkers for diseases of the central nervous system.
Some ALS drugmakers agree. Kasper Roet, CEO of QurAlis, a Cambridge, Massachusetts-based biotechnology company focused on neurodegenerative disorders, recently told BioPharma Dive it would be “really a very positive development if we can use a biomarker like neurofilament to approve an ALS therapy.”
“In the past that has really shown to be a catalyst of bringing meaningful therapies forward,” he added. “It worked in [multiple sclerosis]. It looks like we might have that now in Alzheimer’s disease. And we think neurofilament can be that for ALS.”
Biogen said it will price its drug “within a range comparable to other recently launched ALS treatments.” Relyvrio, which was broadly approved for ALS last year, costs about $158,000 per year, while an oral version of an older branded medicine called Radicava costs about $170,000 annually.
“We believe this strikes the right balance between the scientific and clinical innovation Qalsody delivers with the need to get this treatment to patients as quickly as possible,” Biogen said in an emailed statement.
Unlike those other two drugs, tofersen is only approved for the small fraction of ALS patients who have mutations in the SOD1 gene. Given that limited population, analysts don’t expect tofersen to become a major product for Biogen. Matteis and the team at Stifel predict the drug will generate around $150 million in annual sales at its peak.
Biogen said it expects out-of-pocket expenses for the “majority” of eligible patients will be less than $50 per month.
Article top image credit: Permission granted by Biogen
Why the FDA cleared Amylyx's drug Relyvrio for ALS
The medicine was a test case for the regulator’s flexibility toward new therapies for neurological disorders.
By: Jacob Bell• Published Sept. 29, 2022• Updated Sept. 30, 2022
The Food and Drug Administration’s approval of Amylyx Pharmaceutical’s ALS medicine last year marked a major victory for patients and advocacy groups that have pressed the agency to bring forward more treatments for the fatal disease.
Known as AMX0035, the medicine took a winding journey as Amylyx, its Massachusetts-based developer, sought to bring it to market. While clinical trial results indicated patients benefited from receiving AMX0035, FDA staff and some experts were skeptical about whether enough supportive evidence was collected.
The drug, like a few others in recent years, tested the FDA’s flexibility toward potential therapies for brain and nervous system disorders. In 2021, the agency granted a controversial, first-of-its-kind approval to Biogen’s Aduhelm, an Alzheimer's disease treatment that generated conflicting data in clinical studies. ALS advocates pointed to that decision as one reason for the FDA to clear AMX0035.
The drug is now sold in the U.S. as Relyvrio — different from the brand name Albrioza that’s used in Canada, where it was authorized in 2022. Amylyx charges about $158,000 per year for Relyvrio in the U.S., roughly on par with another ALS medication the FDA approved in 2017.
That medication, called Radicava, had previously been one of two commercially available to ALS patients in the U.S. The other, riluzole, was approved more than 25 years ago. Respectively, the therapies are meant to slow the functional decline associated with ALS and help patients live longer, though doctors note the effects of each are modest at best and temporary.
Amylyx’s drug is also far from a cure, as company co-founders Justin Klee and Josh Cohen readily acknowledge.
Yet, many patients have found it a source of hope, especially in light of how often ALS drug development has ended in failure. In the main study that led to Relyvrio’s approval, patients who received Amylyx’s drug declined slower than those who got a placebo, as measured by a 48-point scale used to evaluate the severity of ALS symptoms. Specifically, drug-treated patients scored about two points higher, on average, reflecting how well they performed daily functions like walking, swallowing or breathing.
While only a single study, the results were convincing for some ALS doctors. Rick Bedlack, director of the Duke ALS Clinic at Duke University, said in an interview.
“This is the best result that I have seen in the history of ALS from one clinical trial,” he said. “It's the only clinical trial I know of that showed both an effect on disability … and on survival.” Bedlack has consulted for Amylyx, but said he was not involved with the clinical research for Relyvrio.
Bedlack wasn’t alone. In a Sept. 7 meeting, a panel of independent experts who advise the FDA on whether to approve new brain and nervous system drugs voted 7-2 in favor of Relyvrio. Though outstanding questions remained about the drug and the data backing it, the panel ultimately determined its benefits outweigh the risks.
Notably, these experts had met in March 2022 and came to the opposite conclusion, narrowly voting against Relyvrio. The FDA made the highly unusual move to reconvene its advisors when Amylyx submitted new analyses that, according to the company, reinforce the survival and functional benefits reported earlier.
In documents and at the September meeting, FDA officials both laid out their concerns with Amylyx’s data as well as highlighted the flexibility afforded to them in reviewing drugs for diseases like ALS.
“We are highly sensitive to the urgent need for the development of new treatments for ALS,” said Billy Dunn, director of the Office of Neuroscience in the FDA arm that evaluates new drugs, at the meeting.
Remarkably, Dunn called on Amylyx to commit to withdrawing Relyvrio from market should follow-up testing that’s now ongoing fail to confirm a benefit. Klee did, a pledge that at least one panelist cited in reversing his vote.
“This approval provides another important treatment option for ALS, a life-threatening disease that currently has no cure,” Dunn said in a Setp. 29 statement “The FDA remains committed to facilitating the development of additional ALS treatments.”
Relyvrio’s approval caps a decade of development that began at Brown University, where Klee and Cohen were then undergraduates studying neuroscience and biomedical engineering. They came up with a combination of two chemicals called sodium phenylbutyrate and taurursodiol, which prior research had suggested could protect the neurons that die as ALS progresses. Both compounds have been studied on their own as ALS treatments and some patients already take one or the other.
Preclinical testing conducted by Klee and Cohen went better than expected and they pushed the combination into a a small study as well as a larger clinical trial named CENTAUR, which became the main support for their approval application.
Although the results, published in The New England Journal of Medicine, were positive, the FDA initially signaled that it wanted Amylyx to run an additional trial before asking for approval — a stance that was criticized by patient groups like the ALS Association. The agency later relented, allowing the company to submit an application while it runs that confirmatory study.
“This [approval] is a victory for the entire ALS community, which came together to advocate for early approval of AMX0035,” said Calaneet Balas, CEO of the ALS Association, in a statement.
The group supported Amylyx’s research with $2.2 million in funding raised through the social media “Ice Bucket Challenge” that drew widespread attention to the disease in 2014.
Ned Pagliarulo contributed reporting
Article top image credit: Permission granted by Amylyx Pharmaceuticals
FDA's full approval of Eisai’s Leqembi opens door to wider use of Alzheimer’s drugs
The broader clearance is expected to push insurers, namely Medicare, to increase coverage of so-called amyloid-targeting therapies.
By: Jacob Bell• Published July 6, 2023• Updated July 7, 2023
In July, the Food and Drug Administration awarded a full approval to the Alzheimer’s disease treatment Leqembi, a decision expected to significantly increase use of the therapy and, potentially, others that work like it.
Developed by partners Eisai and Biogen, Leqembi received a conditional approval early in 2023. FDA staff concluded the drug was reasonably likely to provide some level of benefit to patients, based on results from a roughly 850-person study that showed sharp reductions of a protein many researchers believe to be the root cause of Alzheimer’s.
Insurers haven’t been convinced, however. Medicare, the government program covering the majority of U.S. patients with the disease, has in place a policy strictly limiting access to Alzheimer’s medicines that were given conditional approval and target that protein of interest, known as “amyloid beta.”
Medicare’s policy has curbed the use of both Leqembi and an earlier drug from Eisai and Biogen, Aduhelm, as it requires patients to be enrolled in a randomized clinical trial in order to get these therapies. The pushback has been so intense that Aduhelm, once pegged by Wall Street as a blockbuster product, generated only a few million dollars in its first full year on the market.
Eisai and Biogen have another shot at a multibillion-dollar Alzheimer’s drug with Leqembi, especially now that the FDA has granted full approval. The agency’s decision hinged on results from a larger, more recent clinical trial that found cognition and function declined 27% slower among participants who received Leqembi as opposed to a placebo.
“Today’s action is the first verification that a drug targeting the underlying disease process of Alzheimer’s disease has shown clinical benefit in this devastating disease,” said Teresa Buracchio, acting director of the FDA office that reviews neurological disease drugs, in a statement. “This confirmatory study verified that it is a safe and effective treatment for patients with Alzheimer’s disease.”
While some Alzheimer’s groups and experts have criticized these proposed requirements as overly burdensome, Medicare in June emphasized any registry would be free and easy to use.
That could bode well for Leqembi’s uptake, according to Brian Skorney, an analyst at the investment firm Baird.
In a note to clients, Skorney wrote that the registry is a “minimal barrier for physicians who treat Alzheimer’s disease to prescribe Leqembi to their patients [and] reflects positively on the potential near-term success” of the drug.
Analysts at RBC Capital Markets have predicted Leqembi, which is currently priced at $26,500 per year, could at its peak reach $10 billion in annual sales. Eisai, meanwhile, has said it anticipates at least 10,000 patients in the U.S. will be on the drug by the end of the company's 2023 fiscal year.
But how quickly sales increase will depend on Eisai and Biogen’s ability to address certain challenges. Estimates hold that roughly 6 million people in the U.S. have Alzheimer’s of any stage. If even a relatively small fraction are cleared to use Leqembi — a drug administered via an hour-long intravenous infusion every two weeks — the volume could overwhelm Alzheimer’s treatment centers.
Additionally, treatment with Leqembi requires considerable testing. To be eligible for the drug, patients must be positive for disease-causing amyloid beta and be diagnosed with either mild cognitive impairment or mild dementia due to Alzheimer’s. They also must undergo at least several MRIs before and during treatment to scan for “ARIA,” a known side effect of amyloid-target therapies that presents as swelling or micro-bleeding in the brain.
In the larger study that led to Leqembi’s full approval, around one-fifth of participants on the drug experienced ARIA. There were also three deaths in an extension portion of the study in which all participants received Leqembi. Researchers observed brain bleeding in two of those patients, and a “possible cerebrovascular accident” and severe ARIA in the third.
Leqembi's new label includes a boxed warning — the most significant kind of warning a drug can carry — alerting patients and doctors to the potential risks associated with ARIA.
The safety risks have fueled debate among doctors about whether Leqembi is a net-positive for patients. Some see it as the most effective option yet for slowing a devastating disease, while others believe it offers marginal benefits at best.
According to Constantine Lyketsos, director of the Memory and Alzheimer’s Treatment Center at Johns Hopkins Medicine, Leqembi is “doing better than the placebo, but not much better.”
In an interview earlier in 2023, Lyketsos argued there appears to be a ceiling of effectiveness for even the more promising anti-amyloid drugs. Because of those limits, and the potential side effects, he said he is “certainly going to be very conservative at first” when prescribing medicines like Leqembi.
Costs may also be a concern for prescribers and patients. Medicare expects members on its original plan to pay 20% coinsurance of the Medicare-approved cost for Leqembi once they meet their Part B deductible. That could leave some patients on the hook for hundreds or thousands of dollars.
Medicare noted in a statement that costs may differ depending on whether patients have supplemental coverage or secondary insurance, or if they're enrolled in a Medicare Advantage plan.
“With FDA’s decision, [the Centers for Medicare and Medicaid Services] will cover this medication broadly while continuing to gather data that will help us understand how the drug works,” said CMS Administrator Chiquita Brooks-LaSure.
Article top image credit: Courtesy of Eisai
Big pharma backed away from brain drugs. Is a return in sight?
Many large drugmakers no longer invest heavily in neuroscience. Some biotech executives expect that to change.
By: Jacob Bell• Published Jan. 29, 2020
Editor's note: This story was first published in January 2020, before drug approvals in Alzheimer's disease, ALS and depression revived, to some degree, pharmaceutical company interest in neuroscience drug research. We included this story as a comparator to current industry sentiment about the field. We've updated tenses and references when needed for clarity.
One by one, they left. The world’s largest pharmaceutical companies, skilled at creating drugs for the heart, lungs and joints, couldn’t find the same success in the brain, leading them to either pull back or shutter development over the last decade.
A handful have kept brain drugs a focus, but that’s in stark contrast to 25 years ago, when almost every major developer was pouring money in. Sales of Eli Lilly’s Prozac enticed rivals to find their own blockbuster antidepressants. Pfizer then brought Zoloft to market, followed by GlaxoSmithKline with Paxil. By the early 2000s, a new wave of antipsychotics was helping build multibillion-dollar neurology businesses for AstraZeneca and Bristol-Myers Squibb.
But AstraZeneca, Bristol-Myers, GSK, Pfizer and Amgen no longer devote significant resources to neuroscience. Others, such as Lilly, Sanofi and Merck & Co., have narrowed their investments and number of drug programs. Often these retreats came after a series of clinical failures that called into question whether money would be better spent elsewhere.
Neuroscience still receives healthy levels of early investment, though. It attracted $1.5 billion from venture capitalists in 2018, putting it second only to cancer and suggesting these financiers expect payoffs in the not-too-distant future, perhaps through a big pharma buyout.
Their bet may be well placed too, as industry watchers foresee big pharma mounting a return to neuroscience in the next few years, lured by emerging treatments for epilepsy, mood disorders and genetic diseases of the CNS, or central nervous system.
Though cancer draws the lion’s share of venture capital dollars, brain drugs also attract significant funding.
Venture funding, in billions, by therapeutic area. Mouse-over a therapeutic area to highlight related venture funding.
Venture funding, in billions, by therapeutic area. Click on a therapeutic area to highlight related venture funding.
Select an area▼
Nami Sumida/BioPharma Dive; data from 2019 BIO Industry Analysis
“My prediction is that within the next five years, and certainly within the next 10 years, you’re going to see another golden era of these neuroscience products,” said Steven Paul, who was at Lilly when it developed the blockbuster antipsychotic Zyprexa and now serves as CEO of the neuroscience biotech Karuna Therapeutics.
Paul isn’t alone in that view. In January 2020, the then CEO of Roche Pharmaceuticals said the 2020s could see neuroscience make the same kind of enormous strides that oncology did during the 2010s. Jeremy Levin, head of neurology-focused Ovid Therapeutics and chair to biotech’s largest trade group, expects “radical” new therapies to emerge even quicker, likely in the next three years. Overall, nearly a dozen industry executives and analysts who spoke with BioPharma Dive envision brain drugs making a comeback soon, and with big pharma in tow.
“This is a repeated pattern that you see in the industry,” Levin said in an interview. “People leave things alone, they think it’s a waste of time, waste of money. Then they see some success. The smart big companies dive in, buy the companies out or board with them, and the result is a complete break-open of the field.”
‘Fraught with uncertainty’
Exits from the field at the end of the last decade, however, were hints that neuroscience isn’t always seen as a near-term opportunity.
Amgen terminated drug programs in schizophrenia and Alzheimer’s disease before leaving neuroscience almost entirely in late 2019. The biotech’s head of R&D, David Reese, told BioPharma Dive how the exit rested on several factors, including the industry’s “fairly rudimentary” understanding of neurological diseases, the long development programs some of these drugs require, as well as the clearer opportunities Amgen saw with oncology, inflammation and cardiovascular medicines.
Reese also said his company didn’t want to invest 10 years and billions of dollars in an area so “fraught with uncertainty,” and therefore concluded that standing up biotechs or establishing public-private partnerships would be more encouraging approaches.
Pfizer’s story was similar. It had drugs fail in Alzheimer’s and Huntington’s disease in the years leading up to 2018, when the company decided to take a handful of compounds and create a CNS-focused spin-out with Bain Capital. Pfizer said the move allowed it to redirect money to areas of greater expertise.
Across neuroscience, clinical failures have stacked up because drugmakers didn’t know enough about how the diseases work. These failures then made further investments a riskier proposition for big pharma.
At the same time, researchers were developing impressive new drugs in different diseases, most notably cancer, which spurred large companies to re-prioritize. Since most didn’t have an extensive list of promising brain drugs, neuroscience proved easier research to discontinue.
Now, a consequence of the reprioritization is a relative lack of big pharma resources invested in developing new, effective therapies for some of the world’s most common illnesses. While “me-too” cancer drugs proliferate, there are few, if any, novel treatments for diseases like Alzheimer’s, Parkinson’s and depression, each of which affect millions of patients.
A handful of large pharmas still consider neuroscience a focus area
Each square represents a large pharmaceutical company that focuses on the selected therapeutic area. Click on other therapeutic areas to highlight the companies at work in each field.
Therapeutic areas of focus were either named by the company or selected based on available information for a company’s research pipeline. AbbVie’s areas of focus includes impact of Allergan acquisition, which is pending.
Nami Sumida/BioPharma Dive; pipeline analysis by Jacob Bell
“It wasn’t about exiting neuroscience,” Levin said. “It was about not taking risks and, as a consequence, diverting cash into areas that they think are going to be incredibly productive in the near-term.“
Executives at small biotechs, though, say it’ll take just a few positive studies for the giants to come back. That’s been true with gene therapy as well as immuno-oncology, which produced some of the world’s best-selling drugs, including Merck’s Keytruda and Bristol-Myers’ Opdivo.
“This is a business of momentum, and you don’t want to be left out,” said Richard Peters, former head of rare diseases at Sanofi Genzyme and current CEO of Yumanity, a biotech making drugs for neurodegenerative illnesses. “So if you see a few successes, boards of directors at these companies are quickly going to ask management, ‘Why aren’t we doing that?’”
That pressure may explain why many big pharma companies continue to study Alzheimer’s drugs even if they’re not deeply involved in neuroscience. Analysts expect the first Alzheimer’s treatment on the market that shows an effect on the disease, rather than just its symptoms, would become an instant blockbuster.
Yet neurodegenerative disorders like Alzheimer’s and Parkinson’s have proven exceptionally challenging, due in part to their tangled biological roots.
AstraZeneca, Lilly, Merck, Novartis, Pfizer and Roche each saw experimental Alzheimer’s treatments fail in late-stage testing. Biogen, a top player in neuroscience, won approvals for Aduhelm and Leqembi, Alzheimer's approvals it developed with partner Eisai, but controversy over the data supporting Aduhelm led the companies to abandon marketing of the former medicine.
Going after genes
Though Alzheimer’s isn't solved by any means, drugmakers have notched victories in other neurological diseases like spinal muscular atrophy, in which a genetic defect causes patients’ muscles to waste away. Effective therapies from Biogen and Novartis have come to market since the end of 2016, and a third from Roche could be approved before June.
Drugmakers now have better tools to manipulate and correct genes than in the 1990s and early 2000s. As a result, diseases tied to single genetic defects, such as spinal muscular atrophy, seem easier to target and less risky — attributes that would appeal to large players looking for an entry point back into neuroscience. There are already a couple examples of this, with Pfizer getting into Duchenne muscular dystrophy through its acquisition of Bamboo Therapeutics and Roche showing interest in a Huntington’s program developed by Ionis Pharmaceuticals.
Besides Biogen and Roche, large drugmakers have advanced only a few neurology drugs into late-stage testing
Chart shows the number of neuroscience programs by study stage. Click on the buttons to see how many programs for each company are at each stage of clinical testing.
Chart shows the number of neuroscience programs by study stage. Use the dropdown to see how many programs for each company are at each stage of clinical testing.
Additional therapeutic indications for already approved neurology drugs were not included in counting.
Nami Sumida/BioPharma Dive; pipeline analysis by Jacob Bell
That’s not to say these illnesses are easily treatable. The newfound excitement around Huntington’s, for example, belies the fact that no drug has yet been proven to change the course of the disease.
“My cautionary point on the whole hype-train surrounding monogenic CNS diseases is: the more we’ve dug into them, the more we’ve realized they’re not as simple as you might hope,” Stifel analyst Paul Matteis said.
Even so, Matteis said monogenic diseases would be a reasonable place for big pharma to invest as it rebuilds in neuroscience.
But past that broad category, there’s not much consensus. Levin from Ovid sees epilepsy as a promising target, as do others, but believes psychiatric breakthroughs will be harder to find. Karuna’s Paul disagrees, and says the industry is “right on the verge of having very positive” late-stage data in depression and schizophrenia. Such forecasts are perhaps to be expected: Levin’s company is developing an epilepsy drug while Paul’s is working on a schizophrenia medication.
Drugmaking technologies may also be more valuable than the specific disease target. Ted Dawson, director of the Institute for Cell Engineering at Johns Hopkins Medicine, says he’s seen “an enormous amount of excitement” around antisense therapies that regulate gene expression. Ionis’ business revolves around the antisense platform responsible for developing Biogen’s muscular atrophy drug, while Alnylam Pharmaceuticals has a similar platform that’s at the center of a $1 billion CNS research pact with Regeneron.
Buying back in?
Analysts note that any reinvestment in neuroscience will depend on big pharma’s goals. If a company’s aim is to make brain drugs a core part of its business, then a single, small disease that has no relationship to anything else in its pipeline might be an unlikely target. If that’s not the plan, a company may be fine acquiring a niche, low-risk product, with the potential to tuck it into a broader platform later.
In any case, analysts say big pharma’s interest in neuroscience, if renewed, wouldn’t be focused on just large markets, but also extend to incredibly small, or orphan, diseases. Drugs for those conditions come with regulatory incentives and can be sold at high price tags, potentially making an investment more attractive.
“These days, it does seem like pharma is increasingly interested in the orphan business model,” Phil Nadeau of investment bank Cowen & Co said. “If there were products that seemed like they’d be very successful orphan therapies in neuroscience, I think pharma would probably be interested in acquiring those.”
Acquisitions, as Nadeau points out, would hallmark a big pharma return. Since many large developers don’t have deep research and commercialization teams in neuroscience, a buyout would likely be faster than building from the ground up.
“It certainly seems like a device that companies have used time and again to quickly get back into an area they’ve exited,” Nadeau said.
Deals, though, carry risk even when the science appears validated. Last spring, SVB Leerink analyzed transactions done by the 21 largest drug companies and found just one-third of deals valued at $1 billion or more were “unequivocally successful,” meaning they resulted in new products or better-than-expected revenue growth. On the other hand, one-fifth were failures.
“A skeptic would say the return on invested capital of acquisitions in the biopharma industry is relatively poor. So although it may be quicker, it may not be better,” Nadeau said.
Whether they’re good for the target companies is also up for debate. Many potential buyers wouldn’t have a neuroscience infrastructure for a newly acquired biotech to latch onto, which might make integration more complicated.
There are also concerns that, after the initial wave of excitement, big pharma might retreat again if positive data and drug approvals don’t come steadily.
“The risk is pharma swoops in and buys companies at lower valuations, extracts the value, and then you might be in the cycle,” Vlad Coric, CEO of Connecticut-based Biohaven Pharmaceutical, told BioPharma Dive. “They’ll keep you as long as neuroscience is important to them, and then they’ll be out of it again.”
These worries, combined with easy access to money from venture capital or public markets, may force big pharma to craft better sales pitches if they want to court neuroscience biotechs.
“Capital markets have opened up sufficiently, at least in the United States, to allow for companies to take action themselves,” Levin said.
“You don’t need big pharma’s confidence restored” in neuroscience, he added.
Article top image credit: Adeline Kon / BioPharma Dive
FDA approves Sage, Biogen drug for postpartum depression, but rejects wider use
The agency turned back the companies’ attempt to also win clearance for major depressive disorder, limiting its market potential.
By: Jacob Bell• Published Aug. 4, 2023
The Food and Drug Administration in August granted approval to a new kind of antidepressant, clearing an oral medicine developed by partners Sage Therapeutics and Biogen for postpartum depression.
But, in a decision that will restrict how widely it’s used and the amount of revenue it generates, the agency rejected the companies’ attempt to also win approval for major depressive disorder, or MDD.
According to Biogen, the FDA found the companies’ clinical trial evidence insufficient proof that the medicine, known scientifically as zuranolone, is effective for MDD and asked for further testing.
Both Sage and Biogen have identified zuranolone, which will be sold under the brand name Zurzuvae, as a key product for their near-term growth, with an approval in MDD a core part of their calculus. That’s because, while estimatesvary, health authorities believe tens of millions of people in the U.S. experience MDD, making it one of the most common mental disorders.
Yet, mixed results from studies in MDD appear to drive the FDA’s decision to approve zuranolone only for postpartum depression, or PPD. Around 500,000 women experience postpartum symptoms in the U.S. each year, per an estimate cited by the companies.
“We believe that Zurzuvae will be an important option to treat PPD and we will thoroughly review the feedback from the FDA on the use of zuranolone in MDD to determine next steps,” Biogen CEO Chris Viehbacher said in a statement.
For the past three decades, doctors often prescribed so-called SSRI drugs like Prozac, Lexapro and Zoloft to treat depression. But those medications don’t work for everyone, and they can cause a variety of side effects, from weight gain and impaired cognitive function to aggression and suicidal thoughts.
Zuranolone acts differently than SSRIs; it amplifies proteins that regulate a kind of chemical messenger found in the central nervous system. Clinical trials have shown the drug doesn’t have the more worrisome side effects seen with other antidepressants.
It also appears to provide rapid relief, though in MDD its degree of benefit remains unclear. A large study of zuranolone in that indication failed in 2019. And since then, further late-stage testing has raised questions about how substantial and long-lasting its effects are.
Sage and Biogen have maintained their drug has the ability to quickly rebalance “dysregulated neuronal networks to help reset brain function.”
The FDA based its approval decision in PPD on two clinical trials. One, named SKYLARK, found zuranolone to be significantly better than a placebo when tested in postpartum patients, as measured by a widely used scale that evaluates symptoms of depression. These improvements were seen as early as three days into treatment and sustained throughout 45 days of follow-up.
Other antidepressants can take weeks to show an effect.
“Postpartum depression is a serious and potentially life-threatening condition in which women experience sadness, guilt, worthlessness — even, in severe cases, thoughts of harming themselves or their child,” said Tiffany Farchione, director of the psychiatry division in the FDA’s main drug review office, in a statement.
“Having access to an oral medication will be a beneficial option for many of these women coping with extreme, and sometimes life-threatening, feelings,” Farchione added.
Against MDD, results with zuranolone weren’t as clear-cut. The failed trial, for example, showed zuranolone to be better than a placebo in the initial days following treatment. But its effects appeared to wane, and by day 15 the difference between the drug and control groups had narrowed enough that the study missed its primary goal.
Sage redrew development plans for zuranolone shortly after that setback, announcing in March 2020 how it would conduct three additional late-stage trials in MDD, with the hope of generating enough positive data to support an FDA approval application. A month later, the company said it would lay off a little over half of its workforce to help reduce costs.
Later that year, though, Sage agreed to sell some of the rights to zuranolone and a separate, experimental drug for tremors to Biogen. In exchange, Biogen gave its new partner an upfront cash payment and equity investment that, together, were worth $1.5 billion.
Data from those three additional studies, dubbed WATERFALL, SHORELINE and CORAL, were released between mid-2021 and early 2022. Each had a slightly different design; SHORELINE followed participants for a year after treatment, while CORAL administered zuranolone along with a standard-of-care antidepressant. All tested a higher dose of zuranolone than the failed trial, and all hit their main goals.
The studies weren’t completely positive, however. Zuranolone didn’t meet some of their “secondary” aims, and the drug’s effects still seemed to diminish over time.
Barry Greene, Sage’s CEO, said in a statement that the company was “highly disappointed” in the FDA’s rejection of the drug for MDD.
For postpartum use, Zurzuvae will carry a boxed warning advising doctors to instruct their patients not to drive a motor vehicle or engage in other complex tasks due to the drug’s depressant effects.
The companies don’t expect to make the drug commercially available until the fourth quarter of 2023, as the Drug Enforcement Administration has to first classify it as a controlled substance.
Sage already sells a drug, Zulresso, for postpartum depression. However, it’s given as a continuous intravenous infusion over 60 hours, and carries an FDA warning for excessive sleepiness and sudden loss of consciousness. Sales have been minimal since its 2019 approval.
Ahead of the FDA’s approval decision, analysts at Jefferies forecast annual sales of zuranolone would reach more than $1 billion a year, provided the drug secured an MDD indication. They modeled peak sales from PDD somewhere in the range of $300 million to $500 million.
Article top image credit: nopparit via Getty Images
Karuna, hoping to find new brain drugs, buys up a shuttering biotech’s pipeline
Though Goldfinch Bio focused on kidney diseases, Karuna believes its experimental drugs may have potential treating psychiatric and neurological conditions.
By: Jacob Bell• Published Feb. 2, 2023
Karuna Therapeutics is potentially betting hundreds of millions of dollars on the idea that a shuttering drugmaker’s experimental medicines for kidney diseases could become useful treatments for psychiatric and neurological disorders.
Through a deal announced in February 2023, Karuna secured an exclusive global license to develop, manufacture and market these medicines from Goldfinch Bio, which target a type of protein known as transient receptor potential channels. Goldfinch’s most advanced drug, GFB-887, has been studied in mid-stage clinical trials that tested it across several kidney illnesses, including diabetic nephropathy and focal segmental glomerulosclerosis.
According to reporting from Fierce Biotech, Goldfinch went out of business after failing to secure additional funding. The Cambridge, Massachusetts-based company launched in late 2016 with $55 million from Third Rock Ventures and a mission to usher in a “new era of therapeutic development targeting the molecular basis of progressive kidney diseases.”
Goldfinch’s work later attracted the attention of Gilead Sciences, which, in the spring of 2019, agreed to a multiyear collaboration focused on diabetic kidney disease as well as “orphan” kidney disorders. The heavily backloaded agreement carried a nearly $110 million upfront payment for the smaller company.
About a year after announcing the Gilead deal, Goldfinch secured another $100 million in a financing round led by Eventide Asset Management. Gilead also participated in the round, as did new investors like Wellington Management and Ally Bridge Group.
Yet, like many biotechnology companies with big ambitions, Goldfinch hit setbacks. In 2022, for instance, one of the studies testing GFB-887 delivered mixed results. And since then, a historic downturn in the biotech sector made it far more challenging for Goldfinch and many others to raise money.
"Unfortunately, we had funding challenges, just like I think the rest of the environment, particularly private companies, in the current macro environment," Tony Johnson, Goldfinch’s CEO, told Fierce Biotech.
Specifically, the deal gives Karuna access to drugs directed at the protein channels “TRPC4” and “TRPC5,” which the company believes could have beneficial applications in the brain. Karuna said it intends to study GFB-887 for the treatment of mood and anxiety disorders, and will share more details on the drug’s development plans in the second half of this year.
So far, Karuna’s research efforts have largely revolved around KarXT, an experimental therapy that clinical trials showed to be helpful in the treatment of schizophrenia. Karuna expects this year to ask the Food and Drug Administration to approve KarXT, and is also evaluating the therapy in patients with Alzheimer’s disease psychosis.
Goldfinch’s medicines therefore help to diversify Karuna’s research.
“We believe that the TRPC4/5 mechanism could represent a completely novel approach to treating mood and anxiety disorders and complements our existing pipeline,” Bill Meury, Karuna’s newly minted CEO, said in a statement.
Meury added that the Goldfinch agreement “aligns with our strategic goal to become a fully integrated neuroscience company with treatments that could offer much more than just incremental benefits to patients.”
Article top image credit: Permission granted by Karuna Therapeutics
Neuro-focused biotech Neumora prices IPO in sign of investor interest
The offering brought in significant funds, with Neumora raising $250M alongside the successful IPO of another biotech, RayzeBio.
Two biotechnology companies in late August priced large initial public offerings, potentially signalling returning investor demand for drugmaker stocks after a long dry spell.
Neumora sold 14.7 million shares at $17 apiece to bring in $250 million in gross proceeds from its IPO, according to the company. Shares trade on the Nasdaq stock exchange under the ticker symbol "NMRA."
By and large, though, biotechs have struggled to complete IPOs this year. The companies that did so successfully have a profile RayzeBio and Neumora share: strong private investor backing, veteran leadership and at least one drug candidate in or close to clinical trials.
Their pricings could indicate a coming resurgence, according to Jordan Saxe, head of healthcare listings for the Nasdaq stock exchange.
“This week’s listings indicate that the appetite to invest in innovative healthcare companies is back, and the pipeline of biotech companies looking to tap the public markets is continuing to grow,” Saxe said.
RayzeBio also raised more funds in its stock sale than it had initially projected — a positive indicator for a queue of other young biotechs attempting to go public.
The San Diego-based company is developing an experimental radiopharmaceutical drug called RYZ101 for neuroendocrine tumors. The therapy, which is aimed at the same target as Novartis’ approved medicine Lutathera, entered Phase 3 testing in May.
RayzeBio previously raised $418 million to fund its development of radiopharmaceuticals, which, though tricky to make, can more precisely deliver radiation into tumors. In its regulatory filing, RayzeBio wrote that it sees “an opportunity for innovative radiopharmaceutical therapeutics" to transform how cancer is treated.
Besides RayzeBio and Neumora, 13 other biotechs have priced IPOs so far this year, though nine raised less than $100 million. The pace is in stark contrast to 2020 and 2021, when 183 biotech companies made their Wall Street debuts and raised nearly $30 billion combined, according to BioPharma Dive data.
Still, there have been some signs of a turnaround prior to August. Apogee Therapeutics and Sagimet Biosciences, which both went public in July, upsized their IPOs and offered more shares than originally planned. And in mid-September, British chip designer Arm raised nearly $4.9 billion in the largest IPO to list on Nasdaq this year — an event The New York Times likened to “Wall Street’s Groundhog Day.”
To Kevin Eisele, managing director at investment firm William Blair, IPO activity will still be “slow” compared to the boom times of years past. The fourth quarter is usually quiet, offering biotechs fewer “execution windows” to go public, he said.
“We also anticipate to see a continued uptick in biotech companies going public through reverse mergers ... given the number of small and micro-cap companies currently undergoing disclosed strategic review processes,” Eisele said.
Article top image credit: Spencer Platt via Getty Images
The future of neuroscience drug development
Despite several pullbacks in the field in the last decade, there are signs neurology is again a priority in some corners of the industry. Biotech companies have drawn big-name backers as they’ve moved promising brain drugs into late-stage testing, and new medicines for Alzheimer’s, ALS and depression show a path to market.
included in this trendline
Neuro-focused biotech Neumora prices IPO in sign of investor interest
Big pharma backed away from brain drugs. Is a return in sight?
Why the FDA cleared Amylyx’s drug Relyvrio for ALS
Our Trendlines go deep on the biggest trends. These special reports, produced by our team of award-winning journalists, help business leaders understand how their industries are changing.