A record-setting new health care investor

The former head of health care investing at private equity giant KKR has set records with the first fundraising for his new firm, assembling $3.9 billion to invest in therapeutics, services, and medical devices.

As STAT's Allison DeAngelis reports, the firm is Patient Square Capital, and its founder, Jim Momtazee, ran KKR's health division for nearly two decades. Patient Square took about two years to close its inaugural fund, weathering a declining market and an ongoing pandemic in the process.

In the meantime, the firm has already made three investments in pharmaceutical companies, and it launched a subsidiary last year to invest in mid-stage biotech companies.

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FDA

What's going to happen to Apellis?

Later this month, the FDA will decide whether to approve an eye drug from Apellis Pharmaceuticals, a $6 billion company whose ultimate potential has polarized investors.

As STAT's Adam Feuerstein reports, Apellis' drug is under review for geographic atrophy, a progressive eye disease and a leading cause of blindness in older people. In November, the company submitted new, two-year data on its safety and efficacy, a decision that delayed the FDA's final decision until Feb. 26 and seeded competing theories about what the future holds for Apellis.

According to one reading, Apellis' voluntarily filed extra data to ensure its drug, pegcetacoplan, would win approval with the strongest possible label. According to another, the FDA took a dim view of Apellis' case for approval, and the 11th-hour submission was a last-ditch effort to avoid a pending rejection. There's plenty of evidence to support either in the weeks leading up to what's likely to be biotech's biggest stock-moving event so far this year.

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M&A

Pfizer's still shopping

If your biotech hasn't yet been acquired by Pfizer, there's still a chance. Big Pharma's most prolific dealmaker said yesterday that its long-term growth forecast includes $25 billion in potential revenue by 2030 coming from medicines acquired via outside business development transactions.

Speaking on the company's earnings call, Aamir Mailk, Pfizer's chief business officer, said $10.5 billion, or 40%, of that revenue goal is forecasted to come from products obtained via recently completed acquisitions — Arena Pharmaceuticals, BioHaven Pharmaceuticals, and Global Blood Therapeutics.

That leaves a nice chunk for Pfizer still to grab in future deals.

Math

When 5% off is a better deal than 55% off

Amgen's lower-cost version of Humira, the world's top-selling medicine, is finally available. But the actual price, disclosed yesterday, underlines the U.S.'s labyrinthine health care system and will likely benefit insurers and middlemen more than patients.

More accurately, as STAT's Ed Silverman reports, Amgen's biosimilar will have prices. One, a 55% discount to the list price for Humira, will likely appeal to the relatively small number of health systems that act as both insurer and provider. The second, which is just 5% off the cost of Humira, will be significantly more popular. That's because pharmacy benefits managers, the middlemen who decide which drugs to cover, make their money by negotiating rebates. The higher the price, the more they make — and the more they are supposed to pass on to customers — making the 5% discount preferable to the 55% one.

"Once again, the warped incentives baked into the U.S. drug channel will limit the savings from biosimilars," said Adam Fein, who heads the Drug Channels Institute, a research firm that tracks the pharmaceutical supply chain. "... Unfortunately, patients will lose because some plans and PBMs will block access to the cheaper drug. The plans and PBMs who adopt the higher-priced version will get bigger rebates, while patients with coinsurance and deductibles end up paying more out-of-pocket."

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