JPM24: Novartis’ head start, FTC fallout and Bluebird’s price defense

2024-01-10

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The mood shifts on the third day of the J.P. Morgan Healthcare Conference.

Deals have been announced and news peters out. The most closely-watched companies have already presented. Investors and executives are worn down from two frenzied days of meetings. Many fly back home, thinning the previously packed sidewalks of Union Square.

But every minute of the meeting is critical for the younger, emerging companies fighting for attention. Startups lean on J.P. Morgan to pitch decision makers at larger pharmaceutical firms. For these companies, meeting conversations can lead to deals that provide needed validation and funding.

ArtBio, for instance, is a small company trying to stand out in a large field of competitors developing radiopharmaceuticals for cancer. And Maze Therapeutics is rebounding from a surprise regulatory setback that may or may not have broader implications for the biotechnology sector. Both are featured in today’s report. Read on for details.

Radiopharmaceutical rivals chase Novartis

Radiopharmaceuticals, which deliver a targeted dose of radiation directly to a tumor, have been on the drug industry’s radar for decades. But interest has skyrocketed since the 2022 approval of Novartis’ prostate cancer drug Pluvicto, for which demand has at times outstripped supply.

“What we are doing has activated the whole space,” said Victor Bulto, president of Novartis’ U.S. division.

Since then, Bristol Myers Squibb has acquired Rayzebio for $4.1 billion. Eli Lilly struck a similar-sized deal for Point Biopharma. Startups like Aktis Oncology, Mariana Oncology and ArtBio have raised sizable funds to test their prospective medicines. Many aim to top Pluvicto and an earlier, similar Novartis drug called Lutathera.

To those chasing Novartis, that goal is attainable. Despite Pluvicto’s success, “the opportunity [in prostate cancer] is still there and it’s very large” because there’s room to drive efficacy higher, said ArtBio CEO Emanuele Ostuni.

Bristol Myers’ Chief Medical Officer Samit Hirawat noted how RayzeBio's medicine has shown promise treating patients who already received Lutathera, suggesting they might be able to receive more doses than previously thought. It also may be useful against other tumor types. “We’re looking forward to building on top of that,” he said.

Novartis is confident it can keep its lead, though. The company is moving both Pluvicto and Lutathera into earlier treatment lines, “deeper” into the cancer types for which they are already used, Bulto said. It has scaled manufacturing and is beginning trials testing therapies against other targets. Notably, Novartis is also exploring other radioactive components.

“It’s not surprising that other big companies are coming in,” Bulto said. But “we have a very solid head start.” — Ben Fidler

FTC fallout for Maze

Maze Therapeutics was “as surprised as anyone” when the Federal Trade Commission challenged a licensing deal between the startup and Sanofi, its CEO Jason Coloma said in an interview.

The FTC’s complaint, which Coloma described as “unprecedented,” was triggered by the regulator’s view that Sanofi sought to squelch competition for its Pompe disease drugs by licensing Maze’s experimental treatment. Sanofi quickly canceled the partnership rather than fight the FTC, leaving the fate of Maze’s drug uncertain and erasing hundreds of millions of deal-related funds it was set to possibly receive.

More broadly, the FTC’s challenge is a “troubling” sign for young biotechs, many of which depend on pharmaceutical partners to help advance their research, Coloma said. Going forward, biotechs may start engaging with the FTC during partnership talks, or have more substantive conversations with potential drug partners to get ahead of any potential concerns. Deals might be structured differently, baking in plans for an extended regulatory review process, he said.

The situation “could have a chilling effect” on deals, added Vijay Pande, a general partner at Andreesen Horowitz, which invests in Maze. “The question to ask is, are we really preventing innovation? That's the big concern we all have,” he said.

While investors interviewed by BioPharma Dive at the J.P. Morgan Healthcare Conference were perplexed by the FTC’s stance, most aren’t overly concerned just yet. “At this point, we see it as a one-off,” said Versant Ventures managing director Carlo Rizzuto.

“How many other times have we seen that?” added MPM BioImpact co-managing partner Christiana Bardon. “I don’t think it’s changing the way deals are done.”

The situation still has acute implications for Maze. The company is currently trying to figure out whether it should keep its Pompe disease drug or find a partner. It’s also discussing whether to pursue an initial public offering amid recent signs of market improvement.

“It's all pretty fresh,” said Coloma. “We’ll just have to figure it out over the next couple of weeks.” — Ben Fidler and Gwendolyn Wu

Bluebird defends gene therapy price

On Dec. 8, the Food and Drug Administration approved competing sickle cell gene therapies from Vertex Pharmaceuticals and Bluebird bio. A few hours later, both companies revealed their planned prices: $2.1 million for Vertex’s Casgevy versus $3.2 million for Bluebird’s Lyfgenia.

The nearly $1 million difference between the two caught many off guard, as both products offer similarly dramatic benefits in treating sickle cell symptoms. The difference also seemed to put Bluebird at a market disadvantage, particularly as Lyfgenia also carries a black box warning.

The companies are now in the early stages of convincing insurers their respective products are worth it. So far, they have each signed initial agreements to support access to their therapies. And Bluebird CEO Andrew Obenshain is pointing to his company’s contracts as reason for believing Lyfgenia can be competitive.

“There was a lot of concern that our list price was, at face value, different from our competitors,” said Obenshain Tuesday at JPM. “Today, we have 200 million lives covered. So a lot of that question has been asked and answered about whether they will value these therapies.”

Obenshain also noted that Bluebird — thanks to its experience with a previously approved gene therapy — has been able to stand up a network of treatment sites faster than Vertex.

“We simply have more places to treat patients right now,” said Bluebird’s commercial head Tom Klima.

Doctors, though, expect uptake of either treatment to be slow due to a cumbersome treatment process and notable safety risks. — Ned Pagliarulo