The pharmaceutical community, like much of the country
remains divided about the Affordable Care Act and its impact on healthcare and the industry,
perhaps even more so than when the original law passed in 2010. The industry,
of course, supported the initial legislation, and many people continue to believe
it made the right decision.
But as deadlines approach for the all-important next phase
of the law, execution realities and uncertainty raise questions, many of which
can’t be answered in the near term. Nonetheless, they have implications overall
for the healthcare system and patients, and, more narrowly, for pharma commercial
and business development strategy. This year, in particular, is important for
the market access phase of the legislation, as the country prepares to get new health insurance exchanges running by the Jan. 1, 2014 deadline, and states
decide whether and how to expand their Medicaid offerings to broader populations. As of Jan. 1,
Americans must have individual insurance coverage or pay a penalty (modest at
first); they can buy the coverage through insurance plans listed on health
insurance exchanges which begin operations on that date.
Overall, pharma industry support, officially, at least,
seems high, even as executives worry whether their companies will ever make up
for the tradeoffs they agreed to three years ago in the form of bigger rebates (for
Medicaid and other government programs) and taxes through numbers of newly covered
lives. They are concerned about less high-profile provisions of the act, such
as its dramatic expansion of the 340b program to new categories of hospitals, and
a provision that limits reimbursement companies can get for minor improvements
to their product, as well as the federal and state governments’ ability to
execute their plans on time.
Many states are just now announcing which insurance
companies are participating in the exchanges and those plans are identifying
their basic options, but the industry in general does not yet have a good
perception of what drug coverage will look like, how the new exchange plans or Medicaid expansion will be populated, or how the mandatory individual insurance provisions will be
enforced.
Because no one really has the answers, many in the
industry expect companies to monitor the ACA’s progress closely but continue to operate status quo. They are not so much keeping their heads
in the sand as monitoring cautiously,” says an executive at a firm that advises
companies on market access issues. “From a tactical perspective, no one knows
what will happen, so they are taking the path of least resistance. Top execs
are asking me to come up with projections, and I don’t know them, so they are
proceeding as though there is no effect.”
The uncertainty hasn’t stopped Wall Street from predicting
winners and losers in the healthcare sector in general, or entrepreneurs form
seizing opportunity in the midst of change. At the Jefferies investment bank
conference on June 4, a panel of experts opined about investor beneficiaries,
and all agreed that whatever else, managed care –perhaps by another name—will
be the name of the game going forward. Past efforts to move populations into
managed care failed, but what’s different now is the government support for
such programs, as well as massive databases that able to monitor how the system
is performing.
Meanwhile, the industry’s relentless search for innovation
continues – if for no other reason than because without it, there’s not much of
an industry – witness the struggles of specialty pharma companies such as Elan PLC, Endo Health Solutions, and Forest Laboratories, all laboring to move beyond the enormous success of an
innovative drug but finding it hard to come up with a repeat act.--Wendy Diller
MorphoSys/GSK: MorphoSys has
struck a development and commercialization deal with GlaxoSmithKline for its mid-stage rheumatoid arthritis
antibody, MOR103, which targets the GM-CSF pathway that stimulates production
of immune cells such as macrophages. The deal, announced June 3, gives
MorphoSys near-term cash in the form of a €22.5 million ($29.5 million)
upfront, plus development, regulatory and commercialization milestones that
could add up to €425 million. GSK also will pay a double-digit royalty on all
sales of the product. MOR103 has completed a Phase I study in healthy
individuals, as well as a Phase Ib/IIa trial in 96 patients with mild to
moderate rheumatoid arthritis. Patients in the drug arm of the study showed a
significant effect compared to placebo at just four weeks. GSK will take over
all development, but did not specify when it will begin Phase II studies.
MOR103 has also been tested in patients with multiple sclerosis.
MorphoSys has been shifting gears for the last few months
as it tries to move away from the partnership model that has made it profitable
to concentrate more on its wholly-owned pipeline. MorphoSys has two drugs in
its proprietary pipeline: MOR208, a Phase I asset which targets CD19 for B-cell
malignancies, and MOR202, a HuCAL antibody against CD38 for multiple myeloma. – Lisa LaMotta
Pfizer/CytomX Therapeutics: After obtaining preclinical proof-of-concept last year for
its approach to tumor-specific delivery of specially engineered antibodies, CytomX has struck its
first alliance with a big pharma. Under an agreement announced June 6, the company will collaborate with Pfizer to discover and develop a variation on antibody-drug conjugates (ADCs) for
cancer.
Pfizer will pay the South San Francisco, Calif.-based biotech $25 million in
combined upfront cash and milestones pegged to research and preclinical
achievements. In addition, privately held CytomX could earn up to $610 million
in regulatory and sales milestones, as well as tiered royalties into double
digits on sales of any product reaching market. Because of the selectivity of
candidates generated via its Probody
Platform, CytomX says it can target broadly expressed tissues that are
difficult to reach with other therapeutic approaches because of worries about off-target
toxicity. CytomX uses its technology to generate ADCs that it calls Probody
Drug Conjugates (PDCs), specially engineered antibodies or other approaches to
drug delivery for cancer, inflammation and other unmet medical needs. PDCs will
be safer and differentiated from other ADCs, CEO Sean McCarthy said, because they
are engineered to combine cytotoxic payloads with Probodies that are masked to
become activated only in the tumor’s micro-environment. Pfizer and CytomX are
not disclosing the indications or specific targets on which they will work
together, nor any timelines for the work, other than that it is an exclusive,
multi-target alliance focused on oncology. – Joseph Haas
Janssen Biotech/Second Genome: Janssen Biotech and Second Genome Inc.
announced a landmark research alliance on May 5th in which the latter will apply its
microbiome discovery platform to characterize the role of human bacterial
populations in ulcerative colitis. The goal is to translate the knowledge into
therapeutic programs. The deal marks big pharma’s first commercial
collaboration in microbiome R&D and may stimulate further deals and
investment in the space. Interest in the therapeutic potential of the
microbiome has been building over the past three years with the founding of several venture-backed companies focused on microbiome biology. Second Genome gets an upfront payment and milestones, both undisclosed. The upfront does not include equity. Janssen will fund the
collaborative research through its Johnson & Johnson Innovation Center and the immunology therapeutic area within Janssen R&D LLC. Second
Genome has preclinical programs in inflammatory bowel disease and type 2 diabetes,
each about a year and a half from IND. It also has several discovery
programs. On the
same day, the start-up announced a $6.5 million third tranche to its series A
financing, bringing the total raised to $11.5 million.—Michael Goodman
The Medicines Co./ ProFibrix: The hospital marketer The
Medicines Co. is expanding into the hemostasis market, and has negotiated an option deal with ProFibrix BV
that could improve its position there. The company announced June 4 it has
agreed to pay $10 million upfront for an option to acquire ProFibrix later this
year after Phase III clinical trial results read out on the company’s lead biologic, Fibrocaps. The dry powder topical formulation of
fibrinogen and thrombin is being developed to stop bleeding during surgery. If
the results of the single Phase III trial testing Fibrocaps are positive, The
Medicines Company would pay $90 million to acquire ProFibrix outright. It also
would be on the hook to pay $140 million in regulatory and sales milestones.
ProFibrix’s ongoing Phase III trial, FINISH-3, has completed enrollment of 719
surgical patients with mild to moderate surgical bleeding, and the results are
expected in the third quarter. The Medicines Company already markets the
recombinant thrombin Recothrom, to
which it recently gained rights through an earlier option arrangement with Bristol-Myers Squibb Co.
The Medicines Company plans to combine the 60-person hemostasis group it gained
from Bristol with the ProFibrix team. Both are based in Seattle, although
ProFibrix’s leadership and headquarters are in The Netherlands. Plans call for
CEO Jan Öhrström to stay on with The Medicines
Company and head the company’s efforts in the hemostasis market. – Jessica Merrill
Novavax/Isconova: Eager to add adjuvant technology to its clinical and
preclinical recombinant vaccine candidates, Novavax is making a $29.2 million bid to buy Swedish firm Isconova. Spun out of the Swedish
University of Agricultural Science, Isconova produces saponin-based,
immune-modulating adjuvants. In October 2012, Rockville, Md.-based Novavax,
which has vaccines in clinical development for seasonal influenza, pandemic
influenza, respiratory syncytial virus and rabies, reported successful Phase I
data testing its pandemic flu vaccine boosted with a third-party saponin-based
adjuvant. In a release, Novavax said based on those data plus Isconova’s own
data, it believes the Swedish biotech’s technology can complement and
strengthen its vaccine programs. Novavax announced a public offer June 4 under
which it would issue 15.45 million new shares of common stock and swap 1.2388
shares of its stock for each Isconova share. The deal would represent a 26.7% premium
over Isconova’s share price at the close of trading June 3 and would result in
Novavax shareholders owning 91.1% of the new combined company. Isconova
shareholders would control the remaining 8.9%. Novavax said if the deal goes
through, it will offer Isconova management “positions subject to their
commitment to the combined company,” and it does not plan to seek changes
regarding the Swedish firm’s headcount, employment terms or business location.--JAH
Arno/Veridex: Cancer-focused Arno Therapeutics signed an agreement June
3 with Veridex, a subsidiary of Johnson & Johnson, to develop a diagnostic
test for seeking optimal patients for its oncology candidates. Based in
Flemington, N.J., Arno is developing cancer therapeutics that target the PI3
kinase/Akt pathway, as well as HDAC inhibitors and camptothecins. The two firms will team up to use
Veridex’s proprietary CELLSEARCH platform to develop a diagnostic to detect the
presence of activated progesterone receptors as a biomarker of anti-progestin
activity in circulating tumor cells, those that have detached from a solid
tumor and are found in the bloodstream. Arno is developing onapristone, an
oral, anti-progestin type 1 progestin receptor antagonist. Now in preclinical
development, onapristone is slated to begin clinical study during the second
half of 2013.--JAH
AstraZeneca/ Rigel: AstraZeneca
pulled out of its three-year partnership with Rigel Pharmaceuticals on June 4 after the companies announced
lackluster results of the Phase III program for rheumatoid arthritis drug
fostamatinib, an oral spleen tyrosine kinase (SYK) inhibitor. The drug did not show the levels of efficacy that many other
drugs in the category have in clinical trials, prompting AZ to pull the plug. Rigel intends to evaluate the data from the Phase III
program, which AZ conducted, and make a decision by end of the summer regarding its next
steps. Rigel executives believe that fostamatinib
could still find a place in the crowded RA market, even if the indication is just for a
small subset of patients. Rigel potentially will seek approval of the drug on
its own, but said it will not commercialize the drug without a partner.
The failed program is just the most recent in a string of failures for the British pharma, which has ended programs in cardiovascular and
oncology as well. It has also faced a slew of setbacks with
its diabetes program, partnered with Bristol.--LL
No comments:
Post a Comment