Friday, July 16, 2010

Deals of the Week Must Be Dreaming

Befitting the above image from Inception of the streets of Paris getting wrapped up like the subject of a misinterpreted Manfred Mann tune, DOTW believes a lot of weird shit happened this week. Right? (Please pardon our French.)

The dealmaking was rather quiet, attributable perhaps simply to the calendar but more likely the FDA Advisory Committee main events that were taking place down in quake-prone Maryland. First, go find your nearest In Vivo blogger, and pinch him or her. We must be dreaming. That quake should barely raise an eyebrow compared the rest of the week's strange goings-on.

Our first inkling that we were living in dreamland was when the National League won the MLB All-Star game. Clearly, this isn't reality. BP finally capped the oil leak? Now we're definitely not in Kansas anymore. Next thing you'll be telling us that Steve Jobs is going to address all those complaints about the iPhone 4. Good one.

The oddities included events closer to our -- and probably your -- industry interests. The headfake from FDA's Endocrinologic and Metabolic Drugs Advisory Committee saw Vivus' Qnexa on the short end of a close decision. But that was supposed to happen, right? Sure. But first the briefing documents came out. "Surprisingly benign!" seemed to be the universal refrain. Then the committee meeting itself, where members beleaguered from what must've seemed like a 17-day Avandia reckoning reassembled to discuss Vivus' obesity hopeful. All seemed to be going quite well! Then 7-9. Oops, no, 6-10.

Further dream-sequence confusion? The past quarter's venture numbers and our column-cousin FOTF's poetry slam. And did Avandia really make it out of committee with a very good chance of staying on the market?

Finally, know who else was dreaming (or at least putting on a very smiley nothing-to-see-here face)? Whoever wrote this headline for Vernalis. The news? Biogen and Vernalis pulled the plug on the smaller co's great hope, an A2A receptor antagonist program destined for Phase III trials, because of a preclinical tox signal.

We don't mean to get all Billy Ocean on you, but please: get out of our dreams, get into ...

Mylan Labs/Bioniche: Mylan Labs is breaking into the North American generic injectables market with the $550 million cash acquisition of privately held Bioniche Pharma Holdings from parent co Bioniche Life Sciences, the companies announced on Wednesday. The purchase price, at 4.2x revenue, is richer than the typical generics deal, but according to Mylan the buy brings in "higher-barrier" products, higher-profit margins in the oncology, anti-infectives, and CSN spaces, and sets it up for a push into generic biologics some time down the road. Bioniche adds nearly 30 products and 15 ANDAs and a substantial pipeline to Mylan's UDL Labs unit dose business and will combine with that unit to create Mylan Institutional, a new business focused on hospital and institutional sales in North America. Read our full take on the deal in "The Pink Sheet" DAILY. --Joseph Haas

Evotec/DeveloGen: The long road traveled by DeveloGen, the surviving entity from several rounds of German biotech consolidation during the past decade (Peptor, HepaVec) whose consituent parts date back to the early 90s, is finally at an end. In further German coalescence Evotec said on Wednesday that it was acquiring the metabolic disease-focused private biotech for €14 million in stock plus a potential cash earn-out. DeveloGen adds to Evotec two diabetes-focused deals: a Type-1 diabetes development partnership with Andromeda (that company in turn licenced the compound, DiaPep277, to Teva) and a Type-2 diabetes discovery deal, signed only last year, with Boehringer Ingelheim. Evotec gains a third project, targeting beta cell regeneration for Type-1 and Type-2 diabetes, which is in lead optimization and currently funded by the Juvenile Diabetes Research Foundation. DeveloGen's backers -- surely not breaking anywhere close to even here since its constituent companies raised close to €100 million over the past 17 years -- are eligible for undisclosed cash payments based on future milestones and royalties. -- CM

Watson/Itero Biopharmaceuticals: Privately-held Itero Biopharmaceuticals inked its first product-focused deal this week with Watson Pharmaceuticals. Watson will pay Itero an undisclosed upfront licensing fee to access the San Mateo, CA-based biotech’s recombinant Follicle Stimulating Hormone (rFSH), a biosimilar currently in preclinical development for the treatment of female infertility. Watson, which takes on full development, manufacturing, and commercial expenses related to the rFSH’s development, also owes Itero development and regulatory-based milestone payments, as well as an undisclosed percentage of net sales or net profits in various regions of the world. Formed in 2007, the largely stealth Itero raised $21 million in financing in 2008 from a venture syndicate that includes SV Life Sciences and Panorama Capital. In 2009 it signed an alliance awith XCellerex suggesting cheaper manufacturing of its follow-on proteins may have been one of Itero's strategies. For Watson, the deal is part of a two-pronged strategy to bolster its women’s health offerings and expand into biosimilars, an arena not without risk given the still murky U.S. approval pathway for follow-on-biologics. The New Jersey based biopharma, which develops both generic and branded drugs, has a number of proprietary drugs in women’s health, including Gelnique and four novel contraceptives in various stages of development. The company has plenty of competition from generics firms such as Teva and Novartis’ Sandoz, as well as big pharma players such as Merck and Pfizer.--Ellen Foster Licking

Genentech/MRC Technology: Genentech, in one of its first deals under the new leadership of business development head James Sabry, has brokered an exclusive alliance with the MRC Technology’s Centre for Therapeutic Discovery (CTD) to access an undisclosed number of small molecule drug candidates for treatment of neurological diseases. MRC Technology, the entity responsible for translating research discovered by the UK’s Medical Research Council into commercial products, receives an upfront payment and is eligible to receive clinical development milestones and sales royalties. Full financial terms and the target of the small molecule collaboration were not disclosed. The collaboration is yet another reminder that biopharmaceutical companies in search of innovative medicines are eager to tap the wealth housed in academia. Although this is the CTD’s first official collaboration, MRC is hardly a stranger to the dealmaking table. On July 5, the technology transfer group inked a wide-ranging discovery deal with AstraZeneca in which it agreed to screen a 150,000 compound library from both parties to identify molecules that show activity against 10 biological targets. (Financial terms of that tie-up also weren’t disclosed.) In the case of the recent deal with Roche’s South San Francisco outpost, a focus on neurological diseases is hardly surprising given the depth of talent associated with the therapeutic area now residing within Genentech. In addition to Sabry, who trained as a neuroscientist before leaving academia to play central roles at biotechs Cytokinetics and Arete, both EVP Richard Scheller and CSO Marc-Tessier-Lavigne are highly regarded neurobiologists. —EFL


Chris Morrison said...

I want to add something here. the whole inspiration for this 'weird sh!t' post came from the news that ViiV Healthcare is offering royalty-free licenses to generics makers in countries hard hit by HIV, something I actually forgot to mention when writing it up. It's an unusual and unusually admirable move. Bravo, ViiV.

Alex Lash said...

wrapped a deuce coupe father runner in the night? toothless mother running in the night? What the hell is that guy singing?

And btw, it's originally a Bruce Springsteen song. As a soon-to-be New Jerseyite, you gotta know that.