| | | |   | Hello, all. Damian here with a pair of CEO indictments, an undesirable biotech superlative, and a reminder that 2022 is not yet over. | | | A lucrative pandemic saga ends in indictment At its height in 2020, the biotech company CytoDyn commanded a valuation of more than $5 billion, driven by CEO Nader Pourhassan’s insistence that the company’s experimental treatment for HIV would become a lucrative medicine for Covid-19. Two years and a few embarrassments later, Pourhassan is facing federal charges of defrauding CytoDyn’s shareholders and personally profiting by selling shares of the company’s stock.
As STAT’s Adam Feuerstein reports, federal prosecutors in Maryland allege that Pourhassan and Kazem Kazempour, CEO of a private company that managed CytoDyn’s clinical trials, repeatedly lied about the development and regulatory status of the company’s drug, inflating the stock price and then selling shares at a profit.
The alleged scam fell apart last year after CytoDyn sued Kazempour’s company, Amarex Clinical Research, for breach of contract. The ensuing legal dispute brought to light many of the alleged crimes Pourhassan and Kazempour now face.
Read more. | The second life of a troubled CAR-T company Tmunity, a well-funded startup whose efforts to expand the utility of CAR-T cancer therapy ran aground last year, has been sold for parts to Gilead Sciences.
As STAT’s Jason Mast reports, Gilead’s Kite Pharma subsidiary is paying an undisclosed sum for Tmunity, a company co-founded by the CAR-T pioneer Carl June that raised more than $230 million from venture capitalists and nonprofits. Tmunity’s goal was to take CAR-T technology, which has led to dramatic benefits for patients with blood cancers, and craft effective medicines for solid tumors. Last year, two patients died in a prostate cancer trial, after which Tmunity’s CEO resigned and the company largely went dark.
The allure for Kite was not Tmunity’s work on solid tumors but rather early-stage treatments for leukemias and lymphomas, as well as technology that could allow the company to manufacture its CAR-T therapies faster.
Read more. | | | Like its tortoise namesake, Galapagos takes its time Galapagos, the Belgian drug developer, has the worst enterprise value in all of biotech. That means when you subtract Galapagos’ debt and nearly $5 billion in cash from the company’s market cap, you get less than negative $2 billion, the lowest number in the industry and a sign that investors don’t believe management can do its job of turning money into promising drug research.
The good news is that cash is hard to come by in biotech, meaning Galapagos is an enviable position when it comes to negotiating deals, CEO Paul Stoffels said. “It’s a very difficult time for biotech at the moment and for colleagues who need money,” Stoffels told the Financial Times. “That leaves a lot of opportunities for us.”
But he doesn’t seem to be in any hurry to seize those opportunities. He said basically the same thing in January, when he took the CEO job, and then again in June, explaining that Galapagos had been fielding enquiries from financially troubled biotech companies looking to out-license their ideas to stay alive. In the meantime, the company has signed exactly two deals worth just $144 million, and its share price has fallen about 40%. | The year’s not over yet Cold temperatures, early sunsets, and a deluge of out-of-office email replies suggest the holidays are upon us. But the 2022 biotech calendar still has a few unticked boxes that could move markets. - Any day now, Arrowhead Pharmaceuticals and partner Takeda will have data from a mid-stage, placebo-controlled clinical trial of an RNA-based drug called fazirsiran for patients with alpha-1 antitrypsin deficiency, or AATD, an inherited disease that causes severe liver and lung damage.
- TG Therapeutics is expecting an FDA decision on ublituximab, its investigational treatment for multiple sclerosis, by Dec. 28. The agency delayed its ruling by three months to review the company’s answers to an information request.
- The FDA has until Jan. 6 to make an approval decision on lecanemab, the Alzheimer’s disease medicine from Eisai and Biogen, but precedent suggests the agency might make a ruling before the year is out. While lecanemab is widely expected to get approved, the exact wording of its accompanying label will have sweeping implications for the field.
| More reads - Diabetes treatments are improving. Racial disparities are wider than ever, STAT
- Big Pharma will find right formula for M&A binge, Reuters
- Ahead of lecanemab decision, Alzheimer's groups petition CMS to reverse coverage policy, Endpoints
| Thanks for reading! Until tomorrow,  | | | |
No comments