| | | |   | Hello, everyone. Damian here letting you know that, starting next month, STAT is launching a new, weekly newsletter covering the business of health, including ever-growing insurance companies, influential middlemen, and those nonprofit hospitals that still manage to profiteer. It's called Health Care, Inc., and you can sign up here. | | | Everyone talks about diversifying clinical trials. Actually doing it is complicated After years of consistently dismal data on diversity in clinical trials, research groups, funding agencies, and drug companies have promised time and again to do better. But turning good intentions into good results, as one pathbreaking clinical trial illustrates, can be more complicated than it sounds.
As STAT’s Angus Chen reports, an ambitious effort to potentially change the standard of care for patients with breast cancer set out to recruit a diverse population that reflected the reality of the disease. In the first three years, some 21,000 women enrolled in the study, but less than 2% of them were Black. The researchers, who had relied on tried-and-true methods of clinical enrollment, realized they would need to rethink the process if they hoped to succeed.
That study, which eventually managed to bend the curve of enrollment toward diversity, provides a potential lesson for the entire field of clinical development, which has repeatedly tried and failed to meet the challenge of equitable recruitment.
Read more. | Want to avoid a down round? Consider some debt Among the perils of a market downturn is that some privately held companies, in need of cash, will have no choice but to raise a dreaded down round, in which they sell shares at a cheaper price than they did in the past, forcing managers and their investors to concede, at least on paper, that the whole enterprise is perhaps not quite worth what they once believed.
But what if there were another way? According to Bloomberg, the massive hedge fund Viking Global is raising money to offer a lifeline. The firm is seeking about $1 billion for a fund that would deal in structured equity, meaning it would offer startups a mix of debt, warrants, and cash for preferred shares — whatever they need in order to raise money without cementing a new, lower valuation.
This may sound like a down round by another name, and it’s probably fair to question the wisdom of a cash-burning startup racking up debt in hopes of riding out a bear market that might mutate into a proper recession. But from the companies’ perspective, accepting a lower valuation can have a knock-on effect that raises the cost of acquiring more capital, either in a subsequent round or an IPO. And for venture capitalists, admitting that a given investment is losing ground could make it difficult to retain limited partners, who might want to put their money somewhere less risky now that the broader economic environment is shifting. | While biologic plaque psoriasis treatments dominate airways, topicals finally see innovation Dermavant Sciences announced the FDA approval of their novel topical treatment for adults with mild, moderate, and severe plaque psoriasis – the first and only FDA-approved steroid free topical medication in its class. In clinical trials the treatment demonstrated statistically significant results across primary and secondary endpoints versus vehicle, with no label restrictions on duration of use, body surface area, and an approximately four month off-treatment remittive effect (median time to first worsening). Learn more here. | BioNTech sees a bright future in antibiotics After making about $30 billion in the famously unprofitable world of vaccines, BioNTech is moving into the even tougher market: inventing new treatments for drug-resistant infections.
In an investor presentation yesterday, the German firm explained its plan to combat superbugs begins with bacteria-killing viruses called bacteriophages, which use unique enzymes to destroy their targets. Using technology acquired from an Austrian company called PhagoMed, BioNTech is engineering custom bacteriophages to produce bug-killing enzymes for specific infections, resulting in a precise antibiotic drug.
The idea is still in the early stages of development, and BioNTech did not disclose when it might begin a first human trial. But any progress on novel antibiotics, a field arrested by insufficient funding and a broken marketplace, would be welcome news to the many experts warning of a potential superbug crisis. | Foundering biotech companies can just give stockholders money That’s the plan at Catalyst Biosciences, among the dozens of biotech companies with a negative enterprise value, which said yesterday it would hand over most of its remaining cash to shareholders rather than prolong the inevitable.
Catalyst, which had traded for less than $1 a share for most of 2022, sold its remaining pipeline to Vertex Pharmaceuticals in May for $60 million. The plan now is to hand over all of that cash to stockholders in one or more disbursements, holding on to just enough money to pay for the winding down of the company’s business.
The decision is part of a micro-trend among biotech companies whose valuations have fallen below the cash they have in the bank. Earlier this month, Yumanity Therapeutics sold its lead asset to Johnson & Johnson for $26 million and merged with a private firm to get some value out of its stock ticker. There are about 200 more biotech companies in a similar situation, and unless there’s a sharp improvement in sector sentiment, more and more of them are likely to call it quits in the months to come. | More reads - A rich Republican businessman is an unlikely champion for lower hospital prices — but he’s winning the fight. STAT
- The routine executive stock sales that raise questions of insider trading. Wall Street Journal
- BioNTech, Pfizer to starting testing universal coronavirus vaccine in H2. Reuters
| Thanks for reading! Until tomorrow,  | | | |
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