| | | |   | Hello, all. Damian here with the latest on a buyout boomlet, a setback in Huntington's disease research, and some bellwether pharmaceutical earnings. | | | FDA pauses PTC’s Huntington’s study PTC Therapeutics has run into a setback with its investigational treatment for Huntington’s disease, pausing U.S. enrollment in a clinical trial at the behest of the FDA.
In a circuitous statement issued last night, PTC said the agency “requested additional data” before allowing the company to enroll more patients in the first portion of a Phase 2 study, adding that the drug, PTC518, has not led to any treatment-related adverse reactions in any clinical trial. The company said it is continuing to enroll patients outside the U.S. PTC’s share price fell by more than 20% on the news.
The announcement follows Novartis’ decision in August to suspend dosing in its own Phase 2 Huntington’s study after some patients showed signs of nerve damage. The disease has vexed the pharmaceutical industry for decades, as seemingly promising ideas have repeatedly failed to slow its degenerative effects in pivotal trials. Last year, Roche terminated a Phase 3 study of a closely watched Huntington’s therapy after concluding it was performing no better than placebo. | Biotech bargains abound For shareholders of the more than 100 biotech companies worth less than their cash reserves, there’s always hope that a given firm will get so cheap that a deep-pocketed pharma company will swoop in and buy it outright for cash. For shareholders of Aveo Oncology and Akouos, those hopes were made real yesterday thanks to a pair of multinational acquirers.
Aveo agreed to a $566 million cash buyout offer from the chemicals division of LG, one of the largest conglomerates in South Korea, amounting to a roughly 43% premium on its most recent closing price. And Akouos, developing gene therapies for hearing disorders, agreed to a $487 million cash offer from Eli Lilly that could rise to $610 million if the company hits certain milestones. The deal is more than double Akouos’ most recent market value.
The two buyouts should help keep hope alive for shareholders of biotech companies in decline, but like many of 2022’s acquisitions, the implications depend on one’s perspective. Aveo traded at more than $20 a share as recently as 2019, and for any investors who bought into Akouos’ IPO in 2020 and held on, Lilly’s offer presents a more than 50% loss. | Biotech investors and CEOs see two paths to growth, but are they equally viable? The biotech market is changing and the interplay of investors, private and public markets will be important going forward. Is optimism for the biotech market’s rebound warranted? Dr. Chen Yu, Founder and Managing Partner of TCG Crossover, discusses with RBC’s Noël Brown, Head of US Biotechnology Investment Banking. Get their perspectives on the biotech market’s road ahead and the two paths for company scale-up strategies. | As goes J&J Because Johnson & Johnson is the largest health care company in the world, its financial fortunes tend to be a bellwether for the industry at large. And parsing J&J’s positive results from the last quarter, released yesterday, analysts see hope that the pharmaceutical business can endure an economic downturn.
J&J beat Wall Street’s estimates on both sales and profits, driven largely by its pharma division, which grew about 2% over the same quarter last year. The read-through is that despite inflation and an economy tipping toward recession, people still go to their doctors and fill their prescriptions, an encouraging note for health care as a whole.
The company’s performance supports an emerging narrative among investors: While drug stocks are still down for 2022, the rest of the market is looking worse. And if the broader decline continues, purportedly recession-proof sectors like health care might start to look more attractive. | Roche doesn’t need a clean sweep to press forward in Alzheimer’s With data from a pair of closely watched Alzheimer’s disease studies due any day now, Roche CEO Severin Schwan said the company doesn’t need both to succeed to make its case for FDA approval.
Speaking to analysts in the company’s earnings presentation yesterday, Schwan said that if one trial hits the mark and the other is at least trending toward success, Roche could still move forward with gantenerumab, its amyloid-targeting medicine.
But convincing the FDA is only one facet of turning gantenerumab into a success. Each of Roche’s Phase 3 trials is designed so that the company can declare victory if the drug does at least 20% better than placebo. Lecanemab, a rival medicine from Biogen and Eisai, beat placebo by 27%, according to preliminary data disclosed last month. If those results hold up to scrutiny, gantenerumab’s future could depend on meeting or exceeding that bar. | More reads - A new analysis finds 1.3 million American adults rationed insulin due to cost, STAT
- Moderna signs deal on variant-adapted Covid shots for world's poorest, Reuters
- Biden officials search for backup for key Covid therapy for immunocompromised people, STAT
| Thanks for reading! Until tomorrow,  | | | |
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