June 12, 2023

The need-to-know this morning

Novartis is acquiring Chinook Therapeutics for $3.2 billion upfront, picking up two drugs for a chronic kidney disease that are in late-stage clinical trials. The deal values Chinook at $40 per share, or a 67% premium from Friday's close. STAT's Andrew Joseph has more.
Biopharma M&A continues its torrid pace, with nearly $90 billion in deals announced this year, on track for the best annual performance since 2019.
"Deal flow in biotech remains fast and furious," said Mizuho strategist Jared Holz, in a note to clients this morning. Along with traditional acquisitions, the sector "continues to consolidate via asset sales, reverse mergers, cash distributions and other mechanisms that are setting the stage for a much more palatable and investible universe — at least on the public side."

STARTUPs

Data integrity issue rocked once-promising Laronde

Laronde, a Flagship Pioneering upstart, had been poised for success: The biotech had raised a behemoth $440 million in a 2021 Series B round, which had been based in part on data for an experimental anti-obesity therapy.

But in February 2022, employees were gathered and told there was a problem: An internal investigation had uncovered a "bad assay" and poor note-taking in some of the core research being conducted at the company.

Over the following months, according to a STAT and Boston Globe investigation, concerns over the integrity of the data have led to major tumult at Laronde. The biotech has shelved its two most advanced programs, including the GLP-1 therapy, and is likely to miss its internal goals of submitting paperwork for a clinical trial by the end of the year.

"There are so many ugly things about this whole situation," one former employee said. "We don't want to bring the message to the general public that this is what happens in biotech."

illumina

Reflecting on erstwhile Illumina CEO's tenure

Illumina CEO Francis deSouza resigned from his post over the weekend, following activist investor Carl Icahn's quest to oust leadership at the sequencing giant. Illumina's cachet — and stock — have crumpled since its decision in 2021 to spend $8 billion to reacquire its cancer diagnostics spinout, Grail, without regulatory sanction. Now, Illumina may have to divest Grail for far less than what it paid — creating a stain on deSouza's six-year tenure as CEO.

The roots of the company's problems, STAT's Matthew Harper writes, date back to 2016, when deSouza took over the company from its former chief, Jay Flatley. At its core, this is as much a story of succession planning gone wrong, and of corporate culture being wrenched too quickly from one state to another, as it is one of badly placed strategic decisions.

blood cancer

Kura Oncology posts solid remission data in advanced leukemia

An experimental cancer drug from Kura Oncology has helped put more patients' advanced leukemias into remission, according to updated results from an ongoing clinical trial presented yesterday.

As STAT's Andrew Joseph reports, seven of the 20 patients who received a daily dose of the company's genetically targeted cancer drug, ziftomenib, saw their disease go into complete remission, a rate of 35%, according to findings presented at the European Hematology Association's annual meeting. The median duration of response for patients was 8.2 months.

Kura said it continues to enroll its registration-directed Phase 2 trial and that it expects to have 85 participants at 62 sites in the United States and Europe.

CRISPR

Intellia CRISPR therapy reduces swelling attacks

Intellia Therapeutics reported yesterday that its experimental CRISPR therapy called NTLA-2002 reduced levels of a disease-causing protein and also reduced by 95% the painful swelling "attacks" experienced by patients with a rare condition called hereditary angioedema.

The updated results from an early-stage clinical trial encompassed data from 10 patients treated with three different doses of NTLA-2002. Last September, Intellia reported results from six patients. NTLA-2002 is designed to fix defective genes inside the body.

Hereditary angioedema can be treated effectively with chronic infusions of antibody treatments. Intellia is using CRISPR to create a one-time therapy that could be a functional cure for the disease. A randomized, Phase 2 study is underway.

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