November 2, 2023

The need-to-know this morning

Novo Nordisk reported third-quarter earnings of 5 Danish krone per share on total revenue of 58.73 billion krone — 29% higher year over year and topping consensus estimates. Sales of GLP-1 obesity drug Wegovy rose 28% to 9.65 billion krone, or $1.4 billion — beating consensus. Sales of the diabetes drug Ozempic were 23.9 billion krone, or $4.2 billion.
Eli Lilly reported third-quarter adjusted earnings of 10 cents per share on total revenue of $9.5 billion — ahead of consensus. Sales of the diabetes drug Mounjaro were $1.4 billion, better than expected.
Regeneron Pharmaceuticals reported third-quarter adjusted earnings of $11.59 per share on total revenue of $3.36 billion — ahead of consensus. Sales of Eylea were $1.49 billion.
Moderna reported an adjusted third-quarter loss of $9.53 per share, driven by mostly non-cash charges related to resizing its manufacturing capacity and tax allowances. Revenue was $1.83 billion, a decrease of 47% related to lower sales of its Spikevax Covid vaccine, but still topping Wall Street's consensus.

Gene therapy

In Duchenne, new data bring a familiar debate

This week's news that Sarepta Therapeutics' gene therapy for Duchenne muscular dystrophy missed its main goal in a pivotal study has drawn diametric reactions. To CEO Doug Ingram, it was "a massive win," and to Wall Street, it was reason enough to cut Sarepta's share price in half.

But to families and doctors in the Duchenne community, the disappointing news brought a familiar frustration after years of clinical failures. Many believe the gene therapy, called Elevidys, really does work, pointing to positive results on secondary endpoints and signs that, had the study been longer, it would have been an unqualified success. But it wasn't, which means those families and doctors will likely face yet another debate over a Duchenne medicine's efficacy and another fight with regulators and payers over who should get access to it.

"It's extremely frustrating," said John Brandsema, a pediatric neurologist at Children's Hospital of Philadelphia who worked on the study. "When you spend decades trying to bring therapies into the clinic for something so severe and just keep missing over and over again."

Read more.

Personnel

A biotech stalwart is hanging it up

After 18 years at the company, BioMarin Pharmaceutical CEO Jean-Jacques Bienaimé is retiring next month, the company said yesterday, ending a tenure that saw the firm grow from a punchy biotech upstart into a consistently profitable drugmaker.

Bienaimé's biotech reputation was built both on BioMarin's consistent execution and his penchant for frankness that sometimes verged on the impolitic. Through years of data readouts and takeout rumors, Bienaimé was doggedly confident BioMarin could build a long-lasting, independent drug company by developing a series of medicines for rare disorders. In the final years of his tenure, the company finally became a consistently profitable enterprise, thanks largely to a treatment for a genetic cause of dwarfism and a gene therapy for hemophilia.

Taking Bienaimé's spot will be Alexander Hardy, the current CEO of Genentech, whose résumé includes stints at Roche, Novartis, and GSK.

GLP-1

What can't Ozempic do?

Amid all the panic over how GLP-1 medicines portend upheaval in biotech, pharma, and the entirety of global capitalism, an impending clinical readout could have legitimate implications for the treatment of a common disease.

Novo Nordisk is concluding a pivotal study testing whether semaglutide, sold as Ozempic and Wegovy, can reduce pain for patients with osteoarthritis. As EvercoreISI analyst Umer Raffat pointed out in a note to clients, the study's ClinicalTrials.gov listing suggests it was completed in September, meaning the results could be made public any day now.

Much like Novo Nordisk's successful study in cardiovascular disease, the trial presents another test for the theory that simply reducing patients' body weight with a GLP-1 drug has broader health benefits. On paper, it would make sense that helping osteoarthritis patients lose weight would lessen pressure on their joints and thus reduce pain. But as Raffat points out, a similar study of an older (and less potent) GLP-1 treatment found no significant benefit, and it's not clear body weight is correlated with osteoarthritic pain.

Markets

The biotech company shareholders might root against

MEI Pharma, like so many small biotech companies in 2023, appears to be circling the drain. It's trading well below its cash value, and it has spent the past month trying to fight off the advances of activist investors who want it to hand money back to shareholders.

Now, in an agreement with those investors, MEI has made the curious decision to give its shareholders a reason to root against its success. Under the deal, MEI said it will pay $1.75 per share in cash to existing shareholders and promised another $1.40 per share if the company's investigational cancer drug misses the mark in an ongoing trial.

If you're an MEI shareholder, you've watched the company lose more than 80% of its value in the last 18 months. It would be understandable if you simply wanted to take whatever cash you could get and be done with it.

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