An IPO that actually popped

At the height of biotech's 2021 boom, companies not only went public with ease, but the majority of those IPOs immediately traded up in value, providing the short-term pop that keeps bankers coming back. During last year's downturn, when only 19 biotech companies went public, simply pricing an IPO was difficult enough, and 2023 was looking little better — until this week.

Structure Therapeutics raised more than $160 million, pricing its shares at the top of the company's projected range. And then Structure's price rose by as much as 80% on the open market, closing yesterday nearly 70% above its IPO value.

Structure, a company with operations in the U.S. and China, is developing an oral treatment aimed at the hormone GLP-1, a target shared by blockbuster injectable drugs for diabetes and obesity including Wegovy and Mounjaro. The company is also working on early-stage treatments for heart and lung diseases.

Financials

Covid is over, according to pharma's balance sheets

Last year, the world's biggest drug companies made some $100 billion selling vaccines and treatments for Covid-19. This year, that number is projected to fall by nearly two-thirds.

That's according to a Reuters analysis, drawing on company statements and analyst forecasts, that points to a sizable, rapid revenue cliff for which companies had little time to prepare.

Some, including Pfizer, have been using their pandemic spoils to acquire new products that might soften the blow of declining Covid sales. But others, like Moderna, have been content to reinvest in their own research, setting the stage for some dramatic declines in 2023 and beyond.

M&A

AbbVie is ready to spend again

As Covid-19 companies face a sales cliff for the most lucrative medicines in recent history, AbbVie is preparing to lose the best-selling drug ever. And that means the company, still paying off the debt from its 2019 acquisition of Allergan, is back to considering sizable deals.

As the Wall Street Journal reports, AbbVie is lifting a self-imposed rule of spending less than $2 billion per year on deals, a cap instituted after the $63 billion Allergan merger. Meanwhile, Humira, the product that accounts for about a third of AbbVie's revenue, is expected to see its sales decimated in the coming years as biosimilar competition increases.

AbbVie has said it expects its business to decline or remain flat this year in the next, returning to growth in 2025. Meeting that goal will likely depend on how wisely the company spends its now-unencumbered cash.

Regulatory

Biogen's other high-stakes medicine gets an FDA date

Zuranolone, a novel antidepressant Biogen paid $1.5 billion to co-develop, will undergo an expedited FDA review and could win approval as early as August.

As STAT's Adam Feuerstein reports, Sage Therapeutics, which invented the drug, said yesterday that the agency granted a so-called priority review for zuranolone, which shortens the decision time and suggests the FDA recognizes the medicine's promise. The agency has not indicated yet whether it will convene an advisory panel of outside experts to review the zuranolone clinical data.

Clinical trials of zuranolone have yielded mixed results, which had raised questions about how the FDA would handle the drug's review. The drug has proved to reduce symptoms of depression within three days of treatment, a novel feature that differentiates it from currently available drugs that are slower acting and might be taken for months, if not longer.

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