Two months later, the fund's plug has been pulled, according to all three partners involved. In response to inquiries, Troy Wilson, the cofounder of PI3 kinase developer Intellikine, Kent Hawryluk, an Indianapolis-based VC, and CMEA life sciences managing director Karl Handelsman issued a joint statement to our sister publication START-UP: “CMEA 8 is dissolved. The decision was mutual and we have amicably parted ways.”
CMEA has had on-again, off-again plans for this fund, going back to 2010 when it was pitching prospective investors on an asset-centric biotech fund, backed in part by Eli Lilly and code-named "Velocity." START-UP wrote about those plans here.
In 2011, CMEA jettisoned plans for Velocity as a standalone fund -- around the same time managing general partner Jim Watson said there would be no eighth fund -- instead carving Velocity out of CMEA VII and making it one of many VC experiments that, in the past couple years, have prioritized lean-and-mean development of in-licensed compounds. (In its current incarnation, Velocity's tag line is "We build drugs, not companies.")
We shouldn't go any further without mentioning the elephant in the room: the sexual harassment suit against CMEA and one of its former executives that went public March 7. Let's be clear: there is no indication that the unraveling of CMEA 8 is linked to the lawsuit, and the two new would-be partners, Wilson and Hawryluk -- no longer listed on CMEA’s Web site, by the way -- are not mentioned in the legal complaint.
After the suit became public (you can find more details and the full text of it here), Wilson, Hawryluk and Handelsman would make no comment except for the statement previously noted.
So what's next? Handelsman referred all inquiries about the lawsuit to CMEA’s lawyer, Lara Villareal-Hutner, who responded with a prepared statement that other media outlets have also received in recent days. It read, in part: “CMEA acted at all times professionally and with integrity, underscored by the fact that for the last eight months the administrative assistants continued working for the Firm, and resigned only after retaining an attorney and filing this lawsuit. While the statements asserted in this lawsuit are salacious, CMEA is confident that the true facts supported by evidence - not others' self-interested mudslinging - will determine the outcome of this case. As such, CMEA is fully prepared to vigorously defend itself and its reputation, and is supremely confident in its ability to prevail.”
Reached in Indianapolis, Hawryluk declined to comment. Meanwhile, Wilson has been busy building, with the help of his former Intellikine colleagues, a self-described “drug discovery incubator” called Wellspring Biosciences, a variation on the increasingly common theme of asset-centric biotech company creation. We noted Wellspring's first deal -- the spinout and partnership of its offshoot Araxes Pharma -- in the March 4 Deals of The Week column. On Wilson’s now-defunct CMEA page, he’s quoted as saying that Wellspring is “exactly the sort of company we want in CMEA 8.”
We'll have a full report on all these doings in the upcoming START-UP. Photo courtesy of flickr user Eschipul.
The court’s decision was that Prometheus’ patents are not valid since they are attempting to cover a law of nature. The analogy to E=mc2 is made. All of biology follows the laws of nature!
Prometheus developed an assay to help identify the correct dose of thiopurine drugs in the treatment of autoimmune disease. If the drug is metabolized too fast the level will be too low and so not effective. Too slow a metabolism and the drug can be toxic.
Potentially lost in the supreme circus around arguments addressing the constitutionality of the Affordable Care Act, the court is going to announce today whether it will grant or deny the ACLU’s cert petition asking it to review its suit against Myriad and determine if genes are patentable. Lawyers anticipate the court will grant the petition, vacate the Federal Circuit’s decision in favor of Myriad and remand the case back to the Federal Circuit for reconsideration in light of its ruling in Prometheus.
While the specific circumstances of the Prometheus case revolve around analyte measurements, by simple analogy it seems to me that the argument can be extended to genes and any gene products. So the identification of genetic variants that, say, cause disease or resistance to treatment by a drug or potential toxic response to a drug would all fall under this Supreme Court ruling.
This is a devastating ruling at the dawn of the personalized medicine era. The Court has wiped out any incentive to figure out why certain individuals might do better on drug A rather than drug B and how much of drug B should be given. And what about all the technologies under development to define the optimal treatment of cancer? Again by analogy, finding out which drug kills the tumor cells to select the correct drug for the patient would seem remarkably similar to the Prometheus situation.
The patent laws were developed to foster innovation and development of commercial enterprises. This decision has set back a key field by as long as it takes to get the ruling reversed.
image of Jacob Jordaen's painting, Prometheus having his liver eaten by an eagle (in our version the eagle is apparently the Supreme Court), via wikimedia commons.
Michael Boss, a biotech executive with companies including Antisoma, Xanthus, Elan and Athena, is currently an independent consultant. He is also an inventor on a seminal biotech patent.
"If you guys were the inventors of regorafenib, you'd have invented regorafenib." It may not have much of a ring to it, but that's the line a Bayer executive might have spoken if screenwriter Aaron Sorkin had scripted the company's tiff with longtime partner Onyx Pharmaceuticals. And like the spats Sorkin brought to the silver screen in The Social Network last fall, the Bayer-Onyx quarrel resulted in a settlement.
What could have shaped up as a cinematic tale of betrayal ended with a handshake this week, as Onyx agreed to drop its lawsuit against Bayer, several days into a trial in U.S. Federal District Court in San Francisco. The agreement resolves litigation that has persisted since May 2009 and restores peace to a partnership that dates back to 1994.
At stake were the rights to Phase III candidate regorafenib, a cancer-fighting compound that bears a strong resemblance to Nexavar (sorafenib), the nearly-$1-billion-a-year oncology drug on which Bayer and Onyx have collaborated since the mid-90s. ("You know what's cool? A billion-dollar drug.") Onyx had charged that Bayer developed the newer molecule in secret, violating the companies' agreement to disclose research of other compounds related to Nexavar. Regorafenib's chemical structure is almost identical to Nexavar's, substituting one fluorine atom for a hydrogen atom.
Rather than simply cutting a check or handing over equity, as Zuck did for both the adversarial Winklevii and his former friend Eduardo Saverin, Bayer has resolved to move forward with its partnership with Onyx, while restructuring some elements. Onyx gets 20% of worldwide sales of regorafenib in oncology, and it won't shoulder any costs for its late-stage development; Bayer will handle that. Bayer will also pay Onyx fees if they agree to co-promote the drug inside the U.S., where it has been tested in metastatic colorectal cancer and gastrointestinal stromal tumors.
Cash changes hands right away, too: Bayer is buying out Onyx's rights to Nexavar royalties in Japan for $160 million, giving Onyx additional funds as it readies another Phase III cancer drug, carfilzomib, for regulatory approval. Moreover, Bayer agreed to waive the change-of-control provisions that would have required Onyx to give up Nexavar profits in the event Onyx is sold, thereby freeing up its merger-and-acquisition options.
It's a good deal for Onyx, which gets timely cash and potential downstream money from a drug it won't have to develop itself. And although the companies have insisted that it's been business as usual between them all along, they appear to have patched things up without much damage to anyone's reputation; Bayer admitted no wrongdoing in the process.
If they never make a movie about regorafenib after all, well, we've got Contagion, haven't we? And also...
Pfizer/Humana:
As fans of both the Philadelphia Phillies and the New York Yankees well
know, the only post-season outcome that matters is a World Series victory. In the less glitzy world of pharma, outcomes
-- particularly data that track real-world outcomes and
measure a drug's effectiveness relative to competitors -- could mean the
difference between drug launches that sparkle and others that fall
flat. With payors now wielding greater control,
pharmas need access to the breadth of
data required for more informed drug development
or post-marketing product plans. Hence, the rise of a new kind of
partnership in 2011: the pharma-payor collaboration. AstraZeneca and Sanofi
were the first to jump on the bandwagon, inking deals with Wellpoint's HealthCore and Medco's United BioSource respectively. This week it's Pfizer's turn: In a five-year partnership, the world's biggest pharma is teaming up with insurer Humana and its research
affiliate Competitive Health Analytics to use real-world outcomes data
and comparative effectiveness. The partnership addresses three chronic disease areas affecting the elderly: pain, cardiovascular disease, and Alzheimer's disease. The companies didn't disclose financials and whether or not the
relationship is exclusive. Presumably Pfizer is providing some kind of
upfront money to support research by the two groups over the length of
the agreement. What kind of "skin" Humana has in this particular game
remains unknown. For instance, if Pfizer worked with Competitive Health
Analytics to show a particular Alzheimer's drug were better than a rival's,
could such data spark a reimbursement commitment from the parent
company? We're guessing not. But that raises the question: is this
multi-year collaboration a true partnership or a
fee-for-service arrangement that gives Pfizer data access? What's clear
is that, as in the AZ/HealthCore and Sanofi/Medco deals, Pfizer
anticipates using the data to improve uptake of already
launched products and to help the R&D crew make better
decisions about the kinds of studies to conduct with pipeline products
to win a stamp of approval not just from regulators but payors as
well. -- Ellen Licking
Teva/Par: Generic drug seller Par Pharmaceuticals is shaping up to be the beneficiary of a Federal Trade Commission consent order requiring Teva Pharmaceuticals Industries to divest itself of two products totaling $200 million in annual sales, as a condition for Teva to acquire Cephalon. If the consent order is approved, Par would acquire the generic versions of transmucosal cancer pain lozenge Actiq (fentanyl citrate) and muscle relaxant Amrix (cyclobenzaprine) from the combined company for an amount to be determined. Teva will also supply a year's worth of generic Provigil (modafinil) to Par after its patent expires in 2012. Teva held 43% market share of generic Actiq, while Cephalon and Watson Pharmaceuticals jointly held 40% of an overall generic Actiq market worth $173 million. Amrix is not marketed in the U.S. as a generic, but the FTC determined that both Teva and Cephalon were on a short list of suppliers who could launch a generic version quickly. The consent order is subject to public comment until Nov. 7, after which time the Commission will decide whether to make it final, potentially greenlighting the $6.8 billion all-cash deal announced in May. -- Brenda Sandburg & P.B.
Pfizer/GlycoMimetics: Pfizer deepened its foray into rare diseases by taking worldwide exclusive rights to a sickle cell disease treatment currently in Phase II. In a deal announced October 11, Pfizer will pay up to $340 million to GlycoMimetics of Gaithersburg, Md., for GMI-1070, which has received orphan drug and fast-track status from the FDA. The drug aims to treat painful episodes of vaso-occlusive crisis, a complication of sickle cell anemia that causes obstruction of blood flow and can lead to organ damage. It is the major cause of morbidity and mortality for patients with the rare genetic disease, which occurs more commonly in people or descendants of people exposed to malaria. In the US, 1 of roughly 500 African-Americans are born with sickle-cell anemia, according to the Centers for Disease Control. To date, veno-occlusive crisis episodes have been treated with hydration, pain medication, and blood transfusion, usually requiring up to a week of hospitalization -- over 75,000 a year, according to GlycoMimetics. The firm says that GMI-1070 is thought to inhibit an early step in the inflammatory process that leads to leukocyte adhesion and recruitment to inflamed tissue. GlycoMimetics will be responsible for continued Phase II development, after which Pfizer will take the reins. Beyond the $340 million potential total, the details of the deal were not disclosed. The total does not include sales royalties if Pfizer brings the drug to market. The deal should provide further motivation to venture backers who see rare diseases as a fruitful investment area. Pfizer isn't the only active acquirer or in-licensor; GlaxoSmithKline, Shire, and Sanofi have all made significant investments in the area, and startups such as Ultragenyx Pharmaceutical and Orphazyme have benefited by attracting lavish venture dollars. -- Alex Lash
Bayer/Yunona Holdings: Bayer has signed a preliminary agreement with Russian pharmaceutical maker Yunona Holdings to set up manufacturing, distribution and sales of drugs in Russia. Under its two-year-old Pharma2020 program, the Russian government has put in place incentives to increase the percentage of drugs sold in Russia to be made in that country, from 23% currently to 50%. A key driver is giving locally-made drugs more favorable reimbursement. As a result, foreign firms such as AstraZeneca, Novartis AG and Novo Nordisk are rapidly committing to build plants in the country, mostly in collaboration with local companies. It’s not clear what drugs Bayer plans to make in Russia, but Yunona is involved in diverse businesses, including oncology drugs and insulin. Analysts consider the country to be one of the major emerging markets for pharmaceuticals. Yunona, which is based in Yekaterinburg in the Sverdlovsk region, represents the Ural Pharmaceutical Cluster, which the Russian government has described as a high-tech complex of production and infrastructure capabilities. The cluster is earmarked for $860 million in government funding between 2010 and 2015. In addition to Yunona, the cluster includes the Ural division of the Russian Academy of Sciences and the Ural Federal University. -- Wendy Diller
Call it Elan's $100 million miscalculation. That figure could be the difference between the deal announced July 2 by Elan Corp. and Johnson & Johnson and the new terms of the deal that the companies could announce at any time, according to reports this weekend in the Wall Street Journal and Reuters.
The companies have to renegotiate their $1.5 billion pact, which gives J&J 18.4% of Elan and slight majority control over Elan's Alzheimer's disease programs, because a federal judge ruled Sept. 3 that a component of the deal violated a longstanding contract between Elan and Biogen Idec. Elan didn't even disclose the component for three weeks because its outside counsel Charles Gilman of Cahill, Gordon & Reindel didn't think it was material. That's what he told the court Sept. 3.
Biogen wasn't amused. Soon after the side deal came to light in late July, it accused Elan of breach of contract. The companies have been development and marketing partners for nearly a decade on Tysabri, a multiple sclerosis drug that has slowly gained the trust of patients and doctors after it was taken off the shelf for a year soon after its late 2004 launch. Tysabri recently hit $480 million in half-year sales, though analysts are split how much larger its market will grow, due to its continued link to a rare but deadly brain infection.
The Journal reported J&J wants to shave at least $100 million from the equity portion of the Elan deal, with the $500 million committed to the Alzheimer's development to remain unchanged.
The difference is a pittance to J&J, but Elan has tabbed the cash from J&J's equity purchase to pay down debt. It had $1.8 billion in long-term debt at the half-year mark.
After browbeating Biogen's lawyer throughout the hearing, Judge Deborah Batts ruled in his favor, setting off choruses in our heads, if not in the courtroom itself, of "Cruel to Be Kind." She ordered Elan to fix the breach of contract by Sept. 26 or risk losing to Biogen its half of the Tysabri rights. The breach centered on Elan giving J&J the right to finance a buyout of Biogen's half of Tysabri, if and when Biogen is ever the subject of a change of control.
Over Elan's objections, the judge ruled the financing right was, in legal terms, an "assignment of rights" -- Elan handing its power in the Tysabri relationship to J&J without Biogen's consent. The case came down to this: Where there's money, there's power. Elan said J&J's money -- its option to help finance a future buyout -- was merely a banking relationship and didn't give it power until the money was in Elan's hands. Biogen said no, that money is power even before changing hands, and the judge agreed.
Speaking of "Money," we wonder if Pink Floyd's version ever made the in-flight rotation on the private company planes that raised so much investor ire. I think I need a lear jet, indeed.
For those who want to parse the legalese, the case turned on the phrase "the sole discretion of the non-acquired party." That phrase is in the Biogen-Elan contract, written up in 2000. If either partner is ever bought out, the other -- the "non-acquired party" -- must decide whether to enter negotiations to buy out the Tysabri rights from the acquired party. The judge said J&J's financing option shifted that discretion to J&J, and she pointed to language in the Elan-J&J agreement to make her ruling.
The agreement, still under seal but quoted extensively in the Sept. 3 hearing, said that once Biogen is subject to change of control, Elan must take up negotiations for Tysabri "in a manner directed by J&J." Elan would sit at the negotiating table, but J&J would whisper in its ear. Or, in the words of Biogen outside counsel Michael Gruenglas of Skadden, Arps, Meagher & Flom of New York on Sept. 3, "In section 2B it says that, starting in the second line, J&J shall give written notice to Elan either instructing Elan to exercise the Elan right and to undertake the [negotiating] process provided for in [the Biogen-Elan contract]. Elan's not in the driver's seat. They're not even in the car." Beep-beep, beep-beep, yeah!
Elan counsel Gilman pointed to wording in the J&J-Elan contract that guaranteed Elan would keep all its rights, but the judge, in one of the rare instances she challenged Gilman during the hearing, shot back that just because it says so in the contract doesn't mean it's true. J&J can walk away from the entire Elan deal by Tuesday, Sept. 15, so the clock is ticking.
If indeed Elan and J&J renegotiate their contract to eliminate the offending financing option -- or more specifically the apparent power over Tysabri rights the option seems to give J&J -- the next question is whether Biogen will approve it or go for the throat. Bet on the former: Gruenglas in court said more than once that Biogen doesn't want to grab Elan's Tysabri rights, it only wants Elan to "cure" the breach. Though take note: More than once in this case things have not been as they seem. That certainly sounds like a song waiting to be written.
Partners-turned-adversaries Biogen Idec and Elan Corp. will have their day in court sooner than expected. Yesterday, the presiding judge, Deborah Batts, ordered that the first hearing be moved up a week to tomorrow, Thurs. Sept. 3, at 11:00AM. (Here's a pdf of the court order.)Batts also ordered three of Elan's documents stricken from the record.
Company officials confirmed to IN VIVO the last-minute schedule change but declined to comment either on the cause or on the documents. The stricken documents, which Judge Deborah Batts deemed "extraneous" in her order, are Elan's 25-page "hearing memorandum," a "findings of fact and conclusions of law," and the affadavit of Elan outside counsel Charles Gilman in support of the papers.
The case centers on a major deal Elan cut with Johnson & Johnson and announced in July. Elan is selling J&J 18% of the company, about $1.5 billion, and handing over rights to its Alzheimer's disease programs. But it's also agreed to give J&J the option to finance a buyout of Biogen's rights to multiple sclerosis treatment Tysabri if Biogen is ever subject to a change of control.
Biogen pounced on the financing option deal, saying Elan had made an unauthorized transfer, or "assignment," of rights. It accused Elan of a breach of contract and threatened termination (which would give Biogen full Tysabri rights). Elan countered with a suit asking for a preliminary injunction to prevent termination.
Judge Batts could rule tomorrow on the injunction, on the full breach-of-contract matter, or on neither. - Alex Lash
(Image courtesy of flickrer Diane M. Byrne used with permission through a creative commons license.)
Will a recent court ruling move Pfizer closer to settling $9 billion in claims stemming from its controversial Trovan clinical trial in Nigeria?
Last month, a federal appeals panel jolted the drugmaker by deciding that dozens of Nigerians can pursue lawsuits in a U.S. court over its 1996 clinical trial for the Trovan antibiotic. You may recall the study, which was conducted on approximately 200 children amid an outbreak of meningitis, was blamed for the deaths of 11 youngsters and left many others blind, deaf, paralyzed or brain-damaged.
Beyond the immediate effect on the litigation, though, the U.S. Court of Appeals for the Second Circuit also put the entire pharmaceutical industry on notice. That's because a central issue in the case is whether Pfizer followed international law and properly offered informed consent, which is an ongoing flashpoint in the debate over the ethics of conducting clinical trials overseas. With drugmakers increasingly sponsoring clinical trials around the world, the ruling is a harsh reminder that the risks - in terms of liability and negative publicity - can be substantial if something goes awry.
"This is actually of huge importance to all American industries, not just pharmaceutical companies," says Mark Herrmann, an attorney at the Jones Day law firm, who regularly defends drugmakers in product-liability litigation. "Under the law of nations, [the plaintiff] can score big, depending upon whatever happens in another country and whether they [the plaintiff] can hold the company accountable and if there was government involvement...Once you've changed forums, it creates a whole lot of uncertainty for companies...And as more trials are done overseas, [drugmakers] have to be real careful about how they conduct them."
Pfizer has repeatedly maintained that it did nothing improper and that any deaths or injuries were due to the 1996 meningitis epidemic, not treatment given patients in the study.
In arguing they should be allowed to sue Pfizer in the U.S., the Nigerian families cited the Alien Tort Statute, which allows U.S. courts to hear human rights cases brought by foreign citizens, including cases against American officials and corporations. The statute also makes it possible for foreign citizens to press their case when they are unable, otherwise, to obtain justice in their own country. To make their point, the families allege the Nigerian government was involved in "all stages" of the trial.
"This sends a signal to the pharmaceutical industry that, if you don't do informed consent, it's a violation of international law," says Peter Safirstein, an attorney at Milberg Weiss Bershad & Schulman, who represents some of the Nigerians. "And the ruling has far-reaching implications - the stakes are higher now, because pharmaceutical companies are being cautioned to act very carefully when testing on humans. They must know those tests are going to be scrutinized very carefully."
In a Feb. 13 petition requesting that all 12 active judges of the Second Circuit Appeals Court review the Jan. 30 decision, Pfizer acknowledged the seriousness of the situation. The earlier ruling "has grave and far-reaching consequences for U.S. companies doing business abroad...(and) creates an unprecedented private right of action under international law in the U.S. courts," wrote Pfizer's attorneys at the Kaye Scholer law firm in New York.
A review may not occur if a settlement is reached, of course. But one expert cautions that the appeals court ruling, nonetheless, highlights the growing difficulties of conducting clinical trial overseas.
"Whenever there's an increase in litigation and settlement dollars, and any liberal interpretation toward a claimant, it can make things problematic for sponsors trying to get things off the ground," says Catherine Mulligan, an assistant vice president at William Gallagher Associates, an insurance brokerage that underwrites clinical trials for the pharmaceutical industry. "Something like this can change the terms and conditions of the available coverage and what insurers provide." image by flickr user Joe Gratz used under a creative commons license.
After more than a year of anxiety, the U.S. Supreme Court this morning voted 6-to-3 to allow product-liability lawsuits to proceed against drugmakers in state courts (here is the ruling). At issue was the notion of preemption, which says that FDA approval of a drug supercedes state law claims challenging safety, efficacy or labeling.
The decision upheld a ruling by the Vermont Supreme Court that sided with Diana Levine, 63, a musician who lost part of her arm after a hospital administered a Wyeth drug improperly. She developed gangrene, sued Wyeth and was awarded $6 million after arguing the drugmaker wasn't prevented from adding or strengthening the warning on the label, even though the FDA rejected a proposed change.
"Oh, my God. I'm so, so happy. I can't believe this phone call," she tells the Associated Press. "I've been waiting for so long, and I had no idea of what the chances were. I'm just ecstatic. I'm going to have to sit down."
The ruling is a victory for consumers and many others - including 47 state attorneys general; former FDA commissioners; AARP; editors of the New England Journal of Medicine and the Journal of the American Medical Association, as well as various unions and tort law professors - who filed briefs last summer in support of Levine. They insisted that preemption would harm patients, making it more difficult, if not impossible, to seek legal recourse when they are allegedly harmed by a prescription drug.
Once a drug is marketed to thousands of people, we learn of things that we never knew in the clinical trials for that drug - problems that arise over the year as doctors prescribe and patients take the drug day in and day out," says Brian Wolfman, the director of the Public Citizen Litigation Group, who is also one of Levine's attorneys. "For all these reasons, legal immunity for drug manufacturers - as called for by the drug companies and the Bush administration - would have been a huge mistake."
The decision is a blow to the pharmaceutical industry. Drugmakers and their supporters maintained that FDA approval of a drug supercedes state law claims challenging safety, efficacy or labeling. Drugmakers and the FDA - with the backing of the Bush administration and various business groups - had insisted that preemption existed by maintaining the agency's action are the final word on safety and effectiveness.
But the Supremes disagreed. "Wyeth's argument that requiring it to comply with a state-law duty to provide a stronger warning would interfere with Congress' purpose of entrusting an agency with drug-labeling decisions is meritless, because it relis on an untenable interpretation of congressional intent and an overbroad view of an agency's power to preempt state law," the majority ruled.
In advancing the argument that the FDA must be presumed to have established a specific labeling standard that leaves no room for different state-law judgments, Wyeth relies not on any statement by Congress but on the preamble to a 2006 FDA regulation declaring that state law failure-to-warn claims threaten the FDA’s statutorily prescribed role.
Although an agency regulation with the force of law can preempt conflicting state requirements, this case involves no such regulation but merely an agency’s assertion that state law is an obstacle to achieving its statutory objectives. Where, as here, Congress has not authorized a federal agency to pre-empt state law directly, the weight this Court accords the agency’s explanation of state law’s impact on the federal scheme depends on its thoroughness, consistency,and persuasiveness.
Under this standard, the FDA’s 2006 preamble does not merit deference: It is inherently suspect in light of the FDA’s failure to offer interested parties notice or opportunity for comment on the preemption question; it is at odds with the available evidence of Congress’ purposes; and it reverses the FDA’s own longstanding position that state law is a complementary form of drug regulation without providing a reasoned explanation."
For its part, Wyeth was unbowed. "We believed that Federal law prohibited the company from revising its product label as the Vermont court required, and we regret that the Supreme Court disagreed. The medical and scientific experts at FDA are in the best position to weigh the risks and benefits of a medicine and to assess how those risks and benefits should be described in the product's label," the drugmaker's outside attorney, Burt Rein, said in a statement.
Justice Clarence Thomas agreed with the outcome, but didn't join the majority opinion written by Justice John Paul Stevens. Justice Samuel Alito wrote a dissent that was joined by Chief Justice John Roberts and Justice Antonin Scalia. "This case illustrates that tragic facts make bad law," Alito wrote. "The court holds that a state tort jury, rather than the Food and Drug Administration, is ultimately responsible for regulating warning labels for prescription drugs."
Why should the drugmaker be anxious? And why should one of its attorneys write the US Supreme Court clerk about its deal with Pfizer?
As you know, Pfizer plans to acquire Wyeth, which has a closely watched case before the court involving preemption - the notion that FDA approval supercedes state law claims challenging safety, efficacy, or labeling. The case involves a Vermont musician, Diana Levine, who lost part of her arm after being administered a Wyeth drug, and the ruling will determine whether patients can sue a drugmaker through state law when a product has already been approved by the FDA.
Here's the rub: Chief Justice John Roberts sat out a case involving lawsuits against Pfizer because his May 2007 financial disclosure form indicated he held Pfizer stock between $10,000 and $50,000 (back story). The recusal yielded a 4-4 deadlock that upheld the rights of 27 Michigan residents to sue drugmakers for defrauding the FDA in winning product approvals.
As a result, the court left intact a lower-court ruling allowing the Michigan lawsuits to proceed. Had Roberts not recused himself, some observers believe he may have voted in favor of the pharmaceutical industry. Wyeth apparently fears a repeat in the Levine case, and so a Wyeth attorney wrote a letter on Wednesday to the clerk of the Supreme Court to argue that Roberts' Pfizer stock should not prevent him from voting.
Why? The acquisition won't close until at least July 31, after the court is expected to decide the case. "Wyeth does not believe the proposed acquisition warrants amendment of the corporate disclosure statement in its previously filed briefs," writes Seth Waxman, of Wilmer Hale, who represents Wyeth.
image from flickr user dbking used under a creative commons license.
Alnylam's "Glover" patent has been overturned in Europe. Alnylam has their say here, Silence Therapeutics' slant is here.
We've often noted that with no RNAi therapies on the market and companies effectively operating under the research exemption granted via the 2005 Merck v Integra Supreme Court decision that it's difficult to weigh in on RNAi IP (we do however acknowledge that a good proxy for determining the eventual IP winner is watching where deal dollars wind up, and by that measure Alnylam is lightyears ahead).
So do we know what the European Patent Office decision means in the long run? No. Does it give us an opportunity to entertain you on a sunny summer Friday with Lethal Weapon references? Yes.
Not many creatures stirring this pre-holiday weekend, but we couldn't resist keeping up our weekly roundups of what you might have missed anyway. Basically, not much. We guess it isn't a surprise that you won't find us keeping up the not-quite-rigorous blogging pace this week and the beginning of next, though surely we'll pop up from time to time to amuse those of you hard at work. For the rest of you, bundled up on the couch watching "A Christmas Story," be careful not to shoot your eyes out this week.
Winner: IMS Health: Maine's state law that restricts access by medical-data companies to doctors' prescription information is unconstitutional, says a Federal Judge, according to an AP report in today's WSJ. You could have seen this one coming if you a) thought a previous ruling in New Hampshire pointed toward a similar result in Maine or b) you read about this on Friday (hey we told you it was a slow weekend).
The Boston Globeran a Q&A with CMS boss Kerry Weems on Sunday. Weems is on the road encouraging consumers to shop around for the best medicare plans.
The Timesprofiles Renovo CEO Mark Ferguson, whose career has taken him from "dentist to alligator biologist to pharmaceutical chief executive eyeing an estimated £6 billion virgin blockbuster market."
Surprise! The lawyers are out to get Northwest Biotherapeutics—on behalf of their disgruntled shareholders—for the “materially false and misleading statements” issued in that July 9 press release.
Northwest, or their comms department, definitely messed up—we blogged the dodgy release and its subsequent clarification here, and claim no prizes for predicting that something like this would happen. This is not a case of suing McDonalds for serving hot coffee—the lawyers, for once, have a reasonable point. Northwest declared that the world’s first therapeutic cancer vaccine was available to patients. It wasn’t. The experimental substance was allowed into Switzerland—conditionally.
Acting on behalf of “defrauded investors,” law firms like Hagens Berman Sobol Shapiro can see good business in the inherently risky, volatile biotech sector. They’re slapping suits about everywhere, it seems, including recently on GPC Biotech and Dendreon, allegedly for misleading investors over their cancer candidate’s progress.
Blaming the management is not always justifiable—especially at young firms trying to get their first drug through the FDA maze. Stuff can go wrong in drug development; investors not ready for that should choose another sector.
Trouble is, the Northwest saga will mean yet more lawsuits, and probably make these actions even more part of the biotech landscape than they already are. That doesn’t seem the best way to encourage transparent communication between management and regulators, and management and their investors.
Welcome to The IN VIVO Blog, home of daily commentary on recent developments in biopharmaceutical business development, R&D, financing, marketing, and policy. Join us for discussion in the comments, or contact us via email.
