PPD buys Merck vax facility

Maureen Martino — Mon, 05 Jan 2009 10:33:15 -0500

CRO PPD has purchased Merck's Wayne, PA-based vaccine testing site and hired nearly 80 Merck employees to operate the facility. PPD will provide Merck with assay development and immunogenicity testing services for Merck's vaccine portfolio. PPD and Merck have worked together for years, and this deal extends their relationship for another five years. Financial details of the deal were not disclosed. "We believe strategic outsourcing is key to the future of R&D and represents an innovative approach to the challenges facing our pharmaceutical and biotechnology clients," said Fred Eshelman, chief executive officer of PPD. "This collaboration with Merck represents a unique opportunity for us to acquire leading scientific talent and state-of-the-art facilities, expand an existing relationship with a long-time client and offer a new service line to other customers in the growing vaccine market." Release

The credit crisis hits home

John Carroll — Mon, 05 Jan 2009 09:08:42 -0500

Steven Burrill is one of the rare industry commentators who put his money where his mouth is. Late in 2008, he spelled out the impact that the credit crisis was clearly going to have in biotech.

"The more mature and blue chip biotech companies will do just fine since they have plenty of cash, product revenue streams, strong pipelines and big pharma partners," he wrote last November. "It is the large universe of small public companies, and private companies looking for venture capital who will feel the most pain."

Even a casual reader of FierceBiotech would have noticed the wreckage piling up in biotech's fast lane in the last quarter of 2008. Once high-flying companies crashed to earth as cash reserves dwindled. The number of biotech companies exploring their "financial alternatives" spiked. Stock prices of weak public companies were blasted after even a hint of bad news. Just the idea of floating a new IPO became an awkward joke.

And there's plenty more damage ahead. As we continue to chart the industry's course after the Crash of 2008, you can expect to see more downsizings, more desperate maneuvers, more SOS signals. But in chaos lies opportunity. While Burrill was making his dire prediction of what lies ahead, he also helped bankroll several promising developers in his portfolio. Good companies with good science and bright prospects--and two years' operating capital in the bank--can reasonably look forward to working out new partnerships, posting positive data and building real value. It will be important--and difficult--to keep that in perspective at a time grim headlines will dominate news coverage.

We switched from a seller's market to a buyer's market in a neck-snapping turnaround, but Big Pharma is still positioned to snap up promising new drug programs. Mergers and acquisitions will likely soar in the year ahead. And who knows, maybe by the end of the year we'll see the beginnings of a fresh appetite for an IPO from a developer. But don't look for a significant upsurge ahead of 2010.

1-20-09: A new administration takes over

John Carroll — Mon, 05 Jan 2009 08:58:21 -0500

A new administration means new legislation on reimportation, a fresh look at stem cell research policy and follow-on bills. And that's just the beginning.

For eight long years the Bush administration has been playing defense against embryonic stem cell research. That will be over with the new Congress in 2009. But while the executive ramparts are being disassembled, the science has taken an important new course. Adult stem cells are proving more versatile than ever expected and may well come with a significantly reduced threat of cancer. But look for more federal money to course its way into the field for both ESCs and adult stem cell work.

Reimportation, the great bugaboo of PhRMA, is another likely hot button issue that will get early attention. The industry lobbying groups will wail and gnash their teeth, but lawmakers are likely to find it difficult to avoid a convenient legislative gambit like this. If the federal government is unwilling to dictate lower drug prices, then they will let the Canadians do it for us. That does mean less money for pharma companies, and it's also likely to spur even greater interest in new drug programs that can command a significant premium in the marketplace. Don't overlook the upside.

BIO, meanwhile, still has its sights set on a follow-on bill that will safeguard intellectual property rights for biotech drugs for a significant amount of time. But while the biotech industry was busy on the legislative front, Big Pharma was waking up to the smell of a new market. AstraZeneca, Merck and Eli Lilly all laid out plans to start work on generic biotech therapies in late 2008. With the industry divided, and some heavyweight lobbying work done on behalf of the big developers, look for Congress to shape new legislation that allows the U.S. to start catching up with Europe. You can see this as inevitable, but investors won't be happy about the loss of biotech's protected IP status.

I have one proviso on all the legislative maneuvering ahead: lawmakers have an extraordinary appetite for delay. Legislative campaigns often stretch for years. Fast movement is rare. A new administration won't change those rules, but this one is promising fast action. We might just get it.

More federal research money after years of flat funding?

John Carroll — Mon, 05 Jan 2009 08:52:26 -0500

Let's hope so.

Researchers say they've had plenty of practice with hard times. With the lid firmly on NIH funding, five long years of static cash flow has steadily eaten away at research budgets.

Obama's picks for top science advisers, though, may help change that grim trend. Genetics researcher Eric Lander and Nobel Prize-winning cancer research Harold Varmus--two top science advisers to the new administration--have lobbied long and hard for new federal dollars. They're unlikely to change positions now that they have the ear of the president. And this new president, love him or hate him, has certainly indicated his support for more funding.

For more than a year now, I've been writing a weekly profile on emerging biotech companies. Time after time I've traced their drug programs back to an academic project at a U.S. university. Early research efforts have opened a host of new fields in drug discovery and are at the center of the drive toward personalized therapies. As the government becomes more interested in accelerating that trend, our money will be well spent putting an increasing number of researchers to work. In turn, they will help spawn the next generation of up-and-coming developers, the lifeblood of a growth industry like biotechnology.

FDA keeps heat on data--but lets itself off the PDUFA hook

John Carroll — Mon, 05 Jan 2009 08:49:25 -0500

In 2008 the FDA approved 24 applications for new chemical entities. OK, that wasn't great, but it was an improvement. In 2007 the record was a paltry 18. Up is good. But 24 is hardly a turnaround number.

This year look for the FDA to continue to ratchet up the heat on data, just as it did in late 2008 for new diabetes therapies. Another sign of the difficulties ahead: One of the agency's expert committees recently rejected a move to use retrospective data analysis to make its case for personalizing cancer drugs to specific subpopulations. Deep institutional skepticism, bred by safety fiascos that will linger long in the agency's memory, will dictate caution even as the FDA insists it is backing a streamlined approach to clinical development.

The agency itself, though, is looking anything but streamlined these days. Time after time, the FDA missed its PDUFA deadline in 2008. The deadlines are the agency's half of a long-standing bargain it made in exchange for the industry's financial support. With the government looking to rack up enormous deficits in an attempt to fuel an economic revival, it's unlikely that FDA funding will be sufficient to meet its deadline commitments in 2009. That means more lost time and value for developers who need clarification from the FDA sooner than they're likely to get it. Once you lay the groundwork for failure, you guarantee that it will happen over and over again.

Personalized medicine comes into its own

John Carroll — Mon, 05 Jan 2009 08:22:34 -0500

Last November I hosted a webinar on the personalized medicine trend. It drove home one more time how an explosion of new genetics research is highlighting the mechanisms that dictate an individual's response to a therapy.

New FDA recommendations suggesting testing to guide physicians on the use of warfarin have helped highlight what will be a growing issue for developers of every size. As our understanding of genetics grows, we will increasingly be able to pinpoint subpopulations that will either be more likely to benefit more from a therapy or suffer severe side effects. This knowledge will make it possible to mount smaller trials able to produce better data on biotech drugs. And it will make it far easier to persuade payers of their potential value.

This years we'll see new technology make it much less expensive to do genomic sequencing, opening up a whole new playbook on development. As I've already noted, the FDA has made it clear that they want this data gathered during clinical trials. And new studies will have to take that into account long before recruitment begins.

Physicians have always used a hit or miss approach to medicine. And that will not end. But increasingly doctors will be able to play much better odds when they address a problem. We won't see the completion of this revolution in 2009--far from it--but we are likely to take several long strides in the right direction. And everyone in the industry needs to understand the consequences.

Roche, Synta ink $1B deal

Maureen Martino — Fri, 02 Jan 2009 13:27:45 -0500

Lexington, MA-based Synta Pharmaceuticals and Roche have signed a licensing deal for preclinical anti-inflammatory compound, according to an SEC filing. Synta gets $25 million up front and up to $1 billion in milestone payments if the drug makes it to market. The companies say three drugs could result from the compound. The company could earn $245 million in development milestones for the first product, and as much as $122.5 million each for the other two products, in addition to royalties.

"We think this is a very attractive target because of the range of indications for the drugs, from allergies and asthma to auto-immune diseases, organ rejection and rheumatoid arthritis," Synta spokesperson Rob Kloppenburg told the Boston Business Journal.

- here's the Journal report
- read the AP report

FDA rejects Salix's ulcerative colitis drug

Maureen Martino — Tue, 30 Dec 2008 09:30:35 -0500

The FDA has decided that Salix Pharmaceuticals will have to run another "adequate and well-controlled clinical trial" before it can approve the company's ulcerative colitis tablet balsalazide. The company is none too pleased with this decision, saying that its NDA for balsalazide was sufficient for approval. Salix "does not intend to conduct additional clinical investigation of balsalazide tablet in this indication," though the company will request a meeting with the FDA to discuss the negative ruling, according to a statement. Salix's stock fell 5 percent following the decision.

- here's Salix's release
- read this AP report

FDA approves prostate cancer drug Degarelix

Maureen Martino — Tue, 30 Dec 2008 09:14:28 -0500

The FDA has approved the first new advanced prostate cancer treatment in four years. Degarelix--made by Ferring Pharmaceuticals--is an injectable gonadotropin-releasing hormone (GnRH) receptor antagonist. It marks Ferrings first approval for a drug. The FDA is still reviewing potential trade names for degarelix; Ferring will begin marketing degarelix as soon as the FDA makes a decision. The EMEA's CHMP also recommended approving Ferring's injection on December 18th.

"We are enthusiastically preparing to enter this therapeutic area of urology. We respect the challenges physicians and patients face in their fight against prostate cancer and hope that we can help them with this new treatment option. This is a big milestone for the U.S. operating unit, and we have been carefully preparing for over two years for this launch," said Wayne Anderson, President and CEO Ferring Pharmaceuticals, USA.

- here's Ferring's release

Novartis pays $20M up front for vax program

Maureen Martino — Mon, 29 Dec 2008 12:58:27 -0500

Novartis is forking over $20 million up front to license AlphaVax's investigational Cytomegalovirus (CMV) vaccine program. CMV causes 700 deaths and 17,00 cases of severe disability in newborns each year. In addition to the upfront fee, AlphaVax will be eligible for milestones and royalties. Novartis also gains the rights of first negotiation to AlphaVax' preclinical respiratory syncytial virus program and also has an option to make an equity investment at the end of phase II clinical trials for 4 million shares.

"We are happy to gain access to a promising vaccine candidate for the prevention of cytomegalovirus infections, which are particularly problematic during pregnancy as they can cause permanent disability in newborns," said Dr. Andrin Oswald, CEO of Novartis Vaccines and Diagnostics. The vaccine is expected to enter phase II clinical trials in 2009.

- here's Novartis' release
- read the AP report