November 8, 2023

The need-to-know this morning

Biogen reported third-quarter adjusted earnings of $4.36 per share on total revenue of $2.53 billion — both metrics higher than the Street's consensus estimate. Multiple sclerosis product revenue fell 14% year over year, but sales of the rare disease therapy Spinraza rose 4%.
Last night, Gilead Sciences reported third-quarter adjusted earnings of $2.29 per share on total revenue of $7.05 billion, also topping consensus. Sales of Veklury, Gilead's treatment for Covid-19, were strong at $636 million, benefiting from a summer surge in cases.

Biotech

How old-fashioned radiation became the hot new thing in oncology

For years, scientists have known that blasts of radiation can decimate tumors. But until recently, researchers didn't have the necessary tools to target only cancer cells and spare healthy tissue.

Thanks to decades of work and a few billion dollars, that has changed. Radiopharmaceuticals — drugs that pair radioactive isotopes with tumor-seeking molecules — have become a rapidly expanding class of medicines, STAT's Allison DeAngelis reports.

The Swiss pharma giant Novartis helped put the field on the map, spending roughly $6 billion to buy two radiopharma startups in 2017 and 2018, and the returns on those deals have galvanized investors and entrepreneurs around the world. There are now about 75 startups developing radiopharmaceuticals, several of which raised substantial funding rounds this year. One of them, RayzeBio, pulled off a more than $350 million IPO earlier this year, despite a flagging market for biotech offerings.

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Activism

BioMarin's CEO will have an interesting first day

Alexander Hardy, who will take over as CEO of BioMarin Pharmaceuticals next month, inherits a profitable company with a proud history, a pioneering new gene therapy, and, as we learned yesterday, a brewing activist challenge.

Elliott Management, a famed and formidable activist, has taken up a sizable stake in BioMarin, Reuters reported, adding that the firm has already had conversations with management about the company's future. The news sent BioMarin's share price up about 13%, its biggest one-day move in more than six years.

Elliott's interest arrives at a point of relative weakness for BioMarin. The company recently scaled back its sales projections to account for a slow launch of its gene therapy for hemophilia A, and it is soon to part ways with Jean-Jacques Bienaimé, its CEO of the past 18 years. But unlike the many foundering biotech companies that attract activist pressure, BioMarin actually makes money, and its other recently approved medicine, a treatment for the most common cause of dwarfism, is on pace to become its biggest-ever product.

VC

A 'free the founders' project graduates its first startup

Curie.Bio, a new biotech investment firm that promises founder-friendly financing, has graduated a first startup from its incubator.

The company is called Forward Therapeutics, and it's emerging with three preclinical medicines for chronic inflammatory disorders. Forward, which got $8 million in seed financing from Curie.Bio, also closed a $50 million Series A from a syndicate that included BVF Partners, RA Capital Management, and OrbiMed. That money will take the company into clinical development, its CEO said.

Curie.Bio launched in February with the goal of staking biotech startups without taking the majority of their equity in a company's earliest stages, an effort to "free the founders," as its partners put it.

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Markets

Drug pricing backlash cuts both ways

At least on Wall Street, where Sage Therapeutics' share price fell about 7% yesterday when the company said it would charge less than analysts expected for its recently approved postpartum depression treatment.

The drug, Zurzuvae, will carry a list price of $15,900 for a 14-day treatment, Sage said yesterday. That's below analyst estimates, which averaged around $20,000, and it's well below the $35,000 Sage charges for an intravenous drug approved to treat the same condition.

The latest Zurzuvae episode reflects Sage's curious corporate position. The company had hoped to win approval for both major depressive disorder, a large market, and postpartum depression, a smaller one. Instead, the FDA rejected the former request and approved the latter. Sage still hopes to win approval in MDD, where higher volume would make up for a lower price, but it can only market Zurzuvae for PPD, which Wall Street views as a niche indication, hence the market reaction.

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