Did Pfizer squander a multibillion-dollar opportunity?

This weekend's news that Merck is paying nearly $11 billion for the maker of a promising immunology drug was a massive validation of its underlying science — and a reminder that Pfizer all but gave away a competing medicine.

Merck is buying Prometheus Biosciences for its drug aimed at TL1A, a bodily protein linked to inflammation and tissue scarring. Late last year, Pfizer out-licensed its own TL1A treatment to Roivant Sciences for nothing up front, instead taking a 25% stake in the Roivant subsidiary that will develop it. About a month later, the Roivant drug outperformed expectations in a Phase 2 trial, with results comparable to Prometheus' treatment.

As SVB Securities analyst David Risinger pointed out, Roivant, which had a market cap of about $5 billion before the acquisition, now looks "significantly undervalued." And if the Roivant drug, called RVT-3101, pans out in late-stage trials, Pfizer will have let a blockbuster opportunity walk out the door.

M&A

GSK to buy Bellus in bid for chronic cough drug

GSK said Tuesday it would purchase Bellus Health for $2 billion, adding a promising chronic cough drug to its pipeline. The all-cash deal values Bellus, based in Laval, Canada, at $14.75 a share, roughly double Monday's closing stock price.

With the acquisition, GSK will get the experimental drug camlipixant, which is in a Phase 3 trial for refractory chronic cough. GSK said it anticipates the medicine could receive regulatory approval in 2026 and framed its purchase as one that would bolster its suite of specialty and respiratory medicines.

Regulatory

FDA approval doesn't guarantee solvency

After months of delays and regulatory scrutiny, Gamida Cell won FDA approval yesterday for its cell therapy that reduces the risk of infection for patients undergoing cancer treatment. But with only enough cash to keep the doors open for a few months, Gamida will need to raise cash and exceed expectations to turn its regulatory success into a business.

The treatment, Omisirge, was approved based on data showing that it was faster and more effective at restoring patients' ability to fight infection compared to infusions of umbilical cord blood, which is commonly used in stem-cell transplants for patients who don't have related donors.

The question now is whether Gamida, which reported only enough cash to make it through the third quarter, can turn Omisirge into a sustainable product. The company has said it hopes to treat about 2,500 patients per year with Omisirge, a goal that would require reaching patients who have access to familial stem-cell donors, not just those relying on cord blood. The company has about $65 million to fund its commercial launch, and with the stock trading at around $1, raising more cash could be a struggle.

Research

A clue on how to stop blood cells from going rogue

Among millions of seemingly healthy blood cells, some harbor ominous mutations that, at hard-to-predict intervals, lead them to grow malignant over time. Now, researchers may have found one of the first windows into why those cells go rogue, and how to prevent it.

As STAT's Angus Chen reports, the phenomenon is called CHIP, short for clonal hematopoiesis of indeterminate potential, and it puts patients at elevated risk of leukemia. "But one of the challenges of CHIP has been that nobody knows how to target it, and nobody knows what these mutations are actually doing," said Siddhartha Jaiswal, a pathology researcher at Stanford University.

Jaiswal and his colleagues may have found an answer. By reverse-engineering the CHIP process in patient samples, they homed in on a gene called TCL1A. When TCL1A is activated, the growth of cancerous cells seemed to thrive, and when the gene got deleted, the cellular expansion receded, suggesting a future therapeutic target.

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Chart of the day

When good data go over poorly

D3 vis exported to PNG (49)

Over the weekend, partners Moderna and Merck presented data on a combination cancer treatment that oncologists called a promising step forward. And then, yesterday, Moderna's stock price fell by 8%, erasing nearly $5 billion in value. What's the disconnect?

The question coming into the presentation was whether the details of the companies' previously disclosed study would hold up to scrutiny. And for the most part, they did: Patients who got a combination of Moderna's personalized cancer vaccine and Merck's Keytruda had lower rates of recurrence than those who got the older treatment alone, and the two groups separated early in the trial, suggesting the vaccine's benefit is rapid and durable.

But there are enough complicating nuances in the small study to seed doubts about an upcoming Phase 3 trial. For one, patients in the vaccine group had higher average expression of a protein called PD-L1, which might have biased the study in favor of the combination treatment. That's probably not enough to explain the entirety of the observed benefit, Evercore ISI analyst Umer Raffat wrote in a note to clients, but it's reason for caution heading into larger studies.

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