Eisai is already succeeding where Biogen failed

The Veterans Health Administration said yesterday that it will widely cover Leqembi, the Alzheimer's disease treatment from partners Eisai and Biogen, in stark contrast to its ruling on the pair's prior treatment.

As STAT's Ed Silverman reports, the roughly 9 million people covered by the VA will have access to Leqembi, provided they meet the criteria specified on the drug's FDA-approved label. The decision preempts the agency that controls Medicare, which will make a ruling on Leqembi later this year.

It also marks another victory for Eisai, which is handling the rollout of Leqembi. Biogen, which was in charge of Aduhelm's failed commercial launch, failed to persuade the VA to cover its drug in 2021, leading to a similar rejection from Medicare that ultimately doomed the product.

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SVB

What it's like when your bank goes under

As the world gawked at the sudden implosion of Silicon Valley Bank, biotech executives around the country faced a more pressing problem: How were they going to make payroll?

As STAT's Allison DeAngelis reports, the collapse of SVB led to four days of frantic uncertainty for the many early-stage drug companies that came to rely on the bank for deposits, loans, and financial services. Biotech CEOs, suddenly locked out of their business checking accounts, scrambled to find investors willing to give them lines of credit.

The bank's demise also placed office and lab leases in jeopardy: It's not uncommon for startups to use a letter of credit from a bank as a security deposit, which would be invalid if SVB went under.

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Activism

Icahn comes for Illumina

Illumina's quixotic effort to buy the cancer-testing firm Grail has alienated investors and erased about $50 billion from the company's valuation. Now Wall Street's most famous — or notorious — activist investor has stepped in to agitate for change.

As STAT's Matthew Herper reports, Carl Icahn has taken a stake in Illumina and wants three hand-picked directors to join the company's board, writing in an open letter that the company's current management has "given the word irresponsibility a new meaning." His problem is that Illumina paid $8 billion for Grail, a liquid biopsy company it had once owned, and then closed the deal despite the objections of regulators, who are now blocking a complete merger of the two businesses.

Icahn tends to get his way, in large part because when he succeeds in redirecting a company's strategy, shareholders usually benefit. Illumina's stock rose about 20% on the news of his stake in the firm, suggesting investors are betting on Icahn.

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M&A

Pfizer will pay what Merck would not

Seagen, which spent the summer fruitlessly haggling with Merck, agreed to sell itself to Pfizer for $43 billion, proving that what's too rich for one pharma can be perfectly palatable for another.

As STAT's Adam Feuerstein reports, Pfizer will pay $229 per share for Seagen and its stable of cancer treatments called antibody-drug conjugates, which work by ferrying chemotherapy directly to tumors. The price is a 32% premium to Seagen's previous close and well above the roughly $200 a share offer Merck reportedly made.

The difference could come down to Pfizer's rare combination of wealth and immediacy. The success of its vaccine and treatment for Covid-19 has given the company an industry-leading pile of cash, while the steady erosion of demand for those products has left a multibillion-dollar hole in its financial future.

But there's no guarantee Pfizer, whose oncology business has some overlap with Seagen's, will be able to get regulatory approval for the deal. Seagen's stock closed yesterday at just under $200, about 13% below the offer price, suggesting some investor wariness about whether the merger will pass an antitrust review.

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