Amicus Therapeutics (FOLD) is purchasing a portfolio of ten gene therapies for $100 million and the promise to pay up to $352 million if the treatments are approved and hit undisclosed sales milestones. The deal arrives just a month after the approval of
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, Amicus’ first drug.
“This is really the next step in putting us in a place where I always hoped Amicus could be,” says John Crowley, Amicus’ chairman and chief executive. But there’s more to this story than most business deals. Both Crowley and one of the executives at the company Amicus is purchasing have children with an extremely rare disease.
Amicus has continued to be a company surrounded by excitement. Crowley’s quest, at a previous company, to create a treatment for his two children, Megan and Patrick, was documented in a number of Wall Street Journal stories, a book, and a movie starring Harrison Ford.
At that time, Amicus’ drug, Galafold, for another extremely rare disease called Fabry disease, was facing questions from the FDA even as it was approved in Europe, Canada, Australia, and Japan to treat patients as long as their illness was stemming from specific mutations. The treatment isn’t cheap however as Galafold costs $315,000 per patient per year in the U.S., which is actually a normal price for a drug for an ultrarare disease.
The Galafold approval allowed Crowley to go forward to identify new assets. He identified them in Celenex, the company Amicus is buying. Its story closely mimics Crowley’s own. Celenex was created by a Hollywood producer, Gordon Gray, whose two children had an awful and rare disease called Batten’s disease, which results in profound and lethal neurological decline.
“John, I’m very aware of your family’s journey,” Gray said the first time they talked. “Twelve years ago I was one of the producers considering bidding on your life rights.”
Crowley says Gray, who had produced films including Secretariat and Invincible, exhibited “superhuman effort” to create a drug company. “He put all of that aside to find the science that could save his daughters.” He found the technology he was looking for in gene therapies created at Nationwide Children’s Hospital Center for Gene Therapy that use a virus, called adeno-associated virus, to insert genetic code into cells. The result was a ten-patient study that tested a gene therapy against the CLN6 version of Batten that Gray’s girls have. The girls were among those 10 patients.
Gray and Crowley first connected over the summer. After a long conversation, Crowley brought a team to Ohio State. After a full day, Crowley asked Gordon and his partner if they could return with him to New Jersey. They flew there and went to Crowley’s house, where Meghan was getting ready to go back to Notre Dame. They spent the next day together at Amicus’ headquarters in Cranbury, New Jersey. Across the negotiating table, Crowley says he made a promise.
Where Is The Cancer Industry Headed?
I find it painfully ironic that the more fatal a disease is to the human body, the higher the valuation of the industry responsible for manufacturing and testing treatments to prevent said disease. According to recent statistics released by the American Cancer Society, in 2018, there will be “approximately 22,240 new cases of ovarian cancer diagnosed and 12,070 ovarian cancer deaths in the US,” despite the disease only accounting for 2.5% of all female cancer cases.
Over time, cancer mortality has become the, in most high-income countries, one of the leading causes of death. Several years ago, the global market for cancer treatments hit $100 billion in annual sales, and at the time, analysts were projecting the industry to hit $150 billion by 2018, according to a report by the IMS Institute for Healthcare Informatics. Some have gone as far as to call the cancer industry the most prosperous business in the United States. It is interesting that after decades of cancer research, and billions upon billions of dollars spent on developing new methods of treatment, there are only three FDA-approved treatments for cancer; surgery, radiation therapy, and chemotherapy.
One medical expert, Dr. Thomas N. Seyfried, Ph.D. posits that “no real progress has been made in the management of advanced or metazoic cancer for more than 40 years” because companies and corporations invested in the cancer industry will cease to have a revenue source if the disease is cured. If a cure for cancer were released, and millions of people received treatment, companies who manufacture devices and technologies used for chemotherapy and other conventional cancer treatments would be in trouble.
In recent news regarding the matter, GlaxoSmithKline (GSK), the British pharmaceutical giant announced that the company had reached an agreement to purchase Tesaro (TSRO), a US-based cancer treatment company for $75 per share, or roughly $5.1 billion, according to CNBC. Tesaro (TSRO), based out of Waltham, Massachusetts, is a best known for Zejula, an FDA-approved treatment option for ovarian cancer, which is currently used in both the US and Europe for the treatment of adult patients with ovarian cancer, according to MarketWatch.
“The acquisition of Tesaro will strengthen our pharmaceuticals business by accelerating the build of our oncology pipeline and commercial footprint, along with providing access to new scientific capabilities.”
–Emma Walmsley, Chief Executive Officer, GlaxoSmithKline
Analysts in the biopharmaceutical space have lauded the Tesaro (TSRO) buyout, given that the company’s most purchased drug, Zejula, is not doing as well as investors would have hoped. In fact, after researching several issues endured by Tesaro (TSRO) over the course of the last fiscal year, I question GlaxoSmithKline’s (GSK) judgment in securing this acquisition. For starters, Tesaro (TSRO) isn’t the only company producing treatments that inhibit PARP proteins that can repair damaged cancer cells. Other big name brands like AstraZeneca’s Lynparza have demonstrated success as a PARP-inhibitor as well, resulting in a hyper-competitive market solely based on price per unit, not the quality of the product.
The name of the game in the cancer treatment industry is immuno-oncology or I-O. I-O is a new realm of cancer research where leading experts and medical professionals are looking to create treatment options that help the body’s own immune system to fight cancer. Think of your immune system as the main line of defense when you contract a disease. After first finding a foreign substance (germs, viruses, cancer cells) the immune system responds by trying to destroy the foreign cells. More and more companies are investing in this new industry that is projected to cross $100 billion by 2022.
“This transaction marks the beginning of a new global partnership that will accelerate our oncology business and allow our mission of delivering transformative products to individuals living with cancer to endure. Our board and Management team are very please to announce this transaction, and we are grateful to the management team at GSK for their tremendous vision and the opportunity to preserve and build upon the impact we have had in the cancer community to date”
–Lonnie Moulder, Chief Executive Officer, Tesaro
Eli Lilly’s Stock Climbs As Insulin Levels Drop With New Drug Trials
About 30 million adults in America suffer from diabetes, with recent studies showing that 90 percent to 95 percent, about 1 in 10, of them suffer from type 2 diabetes. When a person is diagnosed with diabetes, this means that their body cannot absorb glucose, taken from consumption of food and drink, from their bloodstream. Diabetes takes two forms; diabetes type-1 and type-2, both with varying effects, in addition to causing issues with glucose absorption.
When a person suffers from diabetes type-1, their pancreas can no longer produce insulin. Insulin is the hormone responsible for processing glucose in hopes of being absorbed into the bloodstream. Alternatively to diabetes type-1, if a person has diabetes type-2, the pancreas does produce the insulin hormone, but similarly to my face when someone on the street asks if I’d like to give to Greenpeace today, the body does not know how to respond to the hormone’s signals.
Consequently, if an individual is diagnosed with type-2 diabetes, this means that their body cannot process the insulin hormone, the glucose is not absorbed into the body and just accumulates in the person’s bloodstream, thus causing large deposits of glucose (sugar) in the blood, commonly known as “high blood sugar.”
Cue the Superman theme song, the one from the old Christopher Reeve movies, none of this “Zack Snyder Superman vs. Batman” nonsense.
Enter Eli Lilly and Co (LLY) a pharmaceutical company with only the purest intentions, determined to create a new drug to help lower blood sugar for individuals suffering from type-2 diabetes. According to research released from the company, the drug seeks to target two hormones (GLP-1 and GIP) simultaneously, compared to currently available drugs that only tackle one hormone, typically GLP-1.
Briefly dipping into the sexy science of these medications, GLP-1 (glucagon-like-peptide-1) and GIP (glucose-dependent insulinotropic peptide) gesundheit, are incretins, which means they have the ability to decrease blood sugar levels by encouraging production of insulin.
Eli Lilly and Co (LLY) announced Thursday, Oct. 4, 2018, that the data from a “mid-stage trail” of their drug “lowered blood sugar and reduced weight” in type 2 diabetes patients, reducing blood sugar levels by up to 2.4% and stimulating weight reduction by 12.7%.
The company said a phase 2b trial of dual GIP and GLOP-1 receptor agonist shows “strong and clinically meaningful blood sugar reduction and weight loss” for people affected by type 2 diabetes.
“These phase 2b clinical trial results for GIP/GLP-1 RA are unprecedented, and the impressive blood glucose and weight reductions seen may lead to a new treatment option”
– Juan Frias, Principal Investigator at the National Research Institute
Following the announcement of this news,
Eli Lilly and Co (LLY) shot up 5.81% to $115.15 in early trading on 10/4/18
Lilly said, in a statement to the industry, that it is their intention to complete its late-stage study for the new diabetes drug in late 2021, and is considering the drug for treatment of obesity and other diabetes-related conditions.
The drugs being tested and, hopefully, offered to the public, are being worked on at a time where Americans are finding out, left and right, that they have some form of diabetes. The issue with diabetes is that, on occasion, symptoms may go unnoticed and people continue to live their lives with no indication that they are ill. Doctors say that if a person lives with diabetes for too long without getting tested and discovering they have the disease, this can result in the development of serious health complications, including heart disease, kidney disease, potential dialysis, and even loss of sight.
If you have any concern that you might be suffering from diabetes, doctors recommend coming in for a blood test. This test is a finger prick of blood, and results are available relatively soon after.
Weight management is important and should not be overlooked, so do yourself and, if applicable, your family a favor, and watch your diet, exercise for at least thirty minutes a day, and you should be good to go.
Big Deals in Biotech Increase As Industry Looks to Capitalize on the Healthy Market
Junior biotech organizations have been obtaining more interest this year. Recently, Boehringer Ingelheim’s shopping spree continued with a EUR210m takeover of ViraTherapeutics, an oncolytic virus specialist it has been working with since 2016.
The privately-held German drug maker was targeting the investment with ViraTherapeutics’ lead candidate VSV-GP, a cancer therapy that works by infecting tumors with a virus that both destroys malignant cells directly and mobilizes an immune response against them.
In addition, German biotech Affimed has previously agreed to deal with Roche’s Genentech to discover new cancer immunotherapies with an amazing $5 billion-dollar deal.
A few stocks to look at include: CEL-SCI Corporation (CVM), Roche Holdings, Inc. (RHHBY), Affirmed N.V. (AFMD), and Marinus Pharmaceuticals, Inc. (MRNS)
Market Cap: $105.57M, Share Price: $3.86
CEL-SCI Corporation announced that the company has received $5,435,367 through the exercise of warrants to purchase shares of the Company’s common stock during August through September 13, 2018. As of September 13, 2018, CEL-SCI had 27,351,324 outstanding shares of common stock.
Roche Holdings, AG.
Market Cap: $207B Share Price: $30.68
Mentioned above, Roche is the parent company to Genentech, which is host to the potential $5 billion dollar deal. The company is currently facing concerns in the UK regarding the pricing of its MS drug.
Market Cap: $265.15M Share Price: $4.25
Affirmed is the company Roche made the deal with and the stock has consolidated a bit since its large jump following the news.
Marinus Pharmaceuticals, Inc.
Market Cap: $283.67M Share Price: $7.00
Marinus Pharmaceuticals, Inc., a biopharmaceutical company dedicated to the development of innovative therapeutics to treat epilepsy and neuropsychiatric disorders, CEO, Christopher M. Cashman, recently presented a company overview at the Baird 2018 Healthcare Conference.
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