July 12, 2023

The need-to-know this morning

Chinese drug regulators approved Enhertu for the treatment of Her2-low metastatic breast cancer, said its makers Daiichi Sankyo and AstraZeneca.
Avrobio said it has halted all work on its gene therapy programs and is exploring "strategic alternatives" for the future of the company. Avrobio went public in June 2018 at $19 per share but was unable to successfully develop any of its one-time treatments for rare diseases. The stock closed yesterday at 98 cents per share.

M&A

Illumina's Grail deal is getting a little more expensive

In the two years since Illumina decided to ignore antitrust regulators and pay $8 billion for the testing firm Grail, it has lost its CEO, about 70% of its market value, and pretty much any hope of salvaging the deal. Now it's going to lose some cash, too.

The European Union's antitrust division, which is blocking the Grail merger, issued a $475 million fine against Illumina today. The fine amounts to nearly 10% of Illumina's annual global revenue, which is the most the European Commission can penalize a company under its merger regulations.

The commission called Illumina's actions "an unprecedented and very serious infringement" of the EU's policies, including the "cornerstone" that regulators review deals that can alter the market. Illumina said it would appeal the commission's decision, calling the fine, "unlawful, inappropriate, and disproportionate."

Alzheimer's

For Leqembi, now comes the hard part

Partners Eisai and Biogen notched a pharmaceutical milestone last week, winning FDA approval for the first medicine shown to clearly slow down the progression of Alzheimer's disease. The next step — actually getting that treatment to people who want it — is going to be a learning process for doctors, patients, and every drugmaker working in Alzheimer's.

As STAT's Rachel Cohrs reports, the process of getting Eisai's treatment, called Leqembi, involves submitting to a brain scan to confirm a patient's diagnosis and then undergoing genetic screening that can predict the risk of serious side effects. Medicare said it will cover those tests, but the exact details of its proposed policy amendments are yet to be publicized.

That coverage is contingent on prescribing physicians submitting regular patient updates to a data registry, designed to track Leqembi's long-term safety and efficacy. Doctors who previewed Medicare's portal said it seemed to function as advertised, but the real test won't come until the pent-up demand for the drug translates into a boom in prescriptions.

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Supply chain

How can the U.S. end dire drug shortages?

Why are life-saving cancer drugs and widely prescribed psychiatric treatments suddenly so difficult to come by? To one economist, the problem is incentives: Manufacturers want to maximize profits while hospitals want to minimize costs and regulators struggle to ensure quality, resulting in a messy system prone to crises.

One potential solution, Brookings Institute economist Marta Wosińka told STAT's Ed Silverman, is a pay-for-performance model. Basically, Medicare would grade the resilience of a hospital's supply chain and pay more to hospitals that had a stable inventory of key drugs from a network of trustworthy vendors. That way, the hospital's incentives better align with those of actual patients.

On the supply side, Wosińka suggests the government help generics manufacturers, which generally operate at low margins, improve their facilities through low-interest loans that can be forgiven if companies meet certain milestones.

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Oncology

What if immunotherapy's next big thing is a bust?

The paradigm-shifting success of cancer immunotherapies called checkpoint inhibitors set off an industry-wide search for new targets that might complement those aging drugs and extend their benefits to more patients. TIGIT, which plays a role in how the immune system reacts to tumors, was supposed to be an ideal combination with medicines like Keytruda, but a series of clinical disappointments has soured its prospects going forward.

The latest evidence came from Novartis, which yesterday opted out of its rights to an anti-TIGIT treatment made by BeiGene. Under a prior partnership agreement, Novartis would have had to pay $600 million to keep collaborating on the drug, called ociperlimab, and hand over another $2 billion or so in milestone payments tied to approval and future revenue.

Novartis' decision to pass comes as little surprise after last year's high-profile failure of tiragolumab, a TIGIT treatment from Roche, in lung cancer and this year's mixed results for a similar medicine from partners Gilead Sciences and Arcus Biosciences. The TIGIT story is beginning to look like that of IDO, a yesteryear immunotherapy target whose initial promise faded into irrelevance once it was put to the test.

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