Pfizer to Raise R&D Spending and Expedite Drugs

Pfizer Inc. plans to increase research and development spending and focus on smaller deals in a bid to accelerate the delivery of potential blockbuster treatments to market.

“We now believe we are getting close to a growth period,” Pfizer Chief Executive Ian Read said in an interview.

The New York City-based drugmaker on Tuesday raised projections for R&D spending to between $7.7 billion and $8.1 billion, up from $7.4 billion to $7.9 billion previously, as it seeks to bring several cancer, pain and other drugs in the later stages of development to the market.

Pfizer announced the R&D spending adjustment while reporting that its second-quarter revenue rose 4% to $13.47 billion, with currency movements providing much of the lift. Its net income grew to $3.87 billion, or 65 cents a share, from $3.07 billion, or 51 cents a share.

Pfizer is now doubling down on its own R&D efforts, after looking to do a big deal in the past few years. The company expects 25 to 30 drugs from its pipeline to be approved through 2022, including as many as 15 with the potential to ring up $1 billion in yearly sales.

Citing that potential, Mr. Read told analysts the company wasn’t interested in a big deal any longer. A bid to buy AstraZeneca PLC in 2014 and a subsequent attempt to merge with Allergan both came to naught.

“I don’t believe we need such a deal to drive the growth of the company. We’d be better off focusing on developing our pipeline,” Mr. Read said during an earnings call. He said the company will look at smaller deals that would add to Pfizer’s product offerings, perhaps for a gene therapy.

Mr. Read also said it would likely help drug companies like Pfizer if the Trump administration goes through with plans to eliminate the rebates they pay to drug-benefit managers. “Removal of rebates will be very beneficial,” he told analysts.

After facing criticism from President Trump over prices, Pfizer said in July it would defer planned increases on more than 40 drugs while the administration implements its plans for tackling drug prices.

In the latest quarter, Pfizer’s results were boosted by the performance of key brands, such as the blood thinner Eliquis, Ibrance breast-cancer pills and rheumatoid-arthritis therapy Xeljanz. Pfizer also got a $377 million revenue lift from a stronger dollar.

Yet Pfizer expects foreign exchange to turn into a headwind, and it lowered its revenue target for the year to between $53 billion and $55 billion.

The company has been considering options including a sale of its over-the-counter medicines business, and it affirmed it expects to make a decision this year.

Pfizer shares, which have gained 16% over the last year, rose 3.5% to $39.93 on Tuesday.

https://bit.ly/2AuZplp

Neuralstem starts Phase 2 for ischemic stroke stem cell therapy

Neuralstem announces initiation of Phase 2 trial of NSI-189  Neuralstem announced the initiation of a Phase 2 clinical trial evaluating NSI-566, the Company’s lead neural stem cell candidate, as a potential treatment for ischemic stroke. Neuralstem announced the positive topline results of Phase 1 stroke study in the 2018 ISSCR (International Society for Stem Cell Research) abstract on June 23, 2018. The trial will be taking place at Bayi Brain Hospital in Beijing, China, commencing on August 1, 2018. Managing the trial will be James Li, Ph.D., Executive Vice President of Asia Operations of Suzhou Neuralstem Ltd, a wholly owned subsidiary of Neuralstem, Inc., located in Suzhou, China. Dr. Li has been made the Manager and a Registered Agent of Suzhou Neuralstem. Neuralstem will be allocating US$3 million toward this trial.

https://bit.ly/2LTkjPu

Evercore ISI Downgrades resTORbio Inc. (TORC) to In Line

Evercore ISI downgraded resTORbio Inc. (NASDAQ: TORC) from Outperform to In Line with a price target of $17.00 (from $29.00).

https://bit.ly/2vti63o

Sanofi stockpiles drugs to prepare for hard Brexit

Sanofi has been preparing drug shortage contingency plans for over a year in the event that the U.K. fails to reach an agreement with the EU on Brexit, the Wall Street Journal reports, citing a person familiar with the matter. The move is the most recent sign that big European companies are concerned about the prospects of a hard Brexit, where the U.K. doesn’t reach a deal over its future relationship with the EU, the report notes

https://bit.ly/2M7zXE7

Google of CRISPR? Tech legends Tim Cook, Jeff Huber back Mammoth Bio

A startup led by a group of Bay Area grad students says it’s building a platform that harnesses the “search engine” function of CRISPR, winning $23 million in backing from a slew of high profile investors Tuesday.

The company, called Mammoth Biosciences, was co-founded by CRISPR legend Jennifer Doudna — one of the most famous scientific pioneers behind CRISPR/Cas9 gene editing tech. The other founders include the 29-year-old CEO Trevor Martin, a Stanford PhD, and CTO Ashley Tehranchi, also out of Stanford. The duo launched the company with the help of two students in Doudna’s lab: Janice Chen and Lucas Harrington, who will lead scientific research. Doudna heads up the scientific advisory board.

Operating under stealth mode until recently, Mammoth first stepped out this April with news that it planned to create a platform for diagnostics. With tech in-licensed from Berkeley, the company wants to apply CRISPR tech to new frontiers.

While many describe CRISPR as the “scissors” of gene editing, cutting DNA and replacing bits of genetic material where needed, Mammoth is more interested in the search function of CRISPR.

“CRISPR is biology’s search engine first,” Martin told TechCrunch in an interview. “Control + F is the exciting part. At core it’s just this amazing search engine that we can use to find things. The way that we search for things is just like Google.”

Now, Mammoth has a round of fresh capital to invest in its platform and staff. The $23 million round was led by Mayfield with participation from NFX and 8VC. Apple’s Tim Cook and the first CEO of Silicon Valley cancer screening startup Grail, Jeff Huber, also joined the round for an unspecified amount.

https://bit.ly/2OyoNty

Blair Ups Medpace, Sees ‘Strong Biotechnology Funding Environment’

Medpace Holdings Inc MEDP 30.38% reported better-than-expected second-quarter earnings Monday afternoon.

The Analyst

William Blair’s John Kreger upgraded Medpace from Market Perform to Outperform.

The Thesis

The company reported adjusted EPS of 67 cents on an ASC 605 basis in Q2, well above Kreger’s 39-cent estimate. (See the analyst’s track record here.)

The beat came due due to better gross margins and higher revenue, the analyst said, naming the earnings beat, excellent bookings and guidance raise as the drivers behind William Blair’s upgrade.

Medpace increased 2018 guidance and said it expects higher revenue by $39 million and earnings that are 65 cents per share higher on an ASC 605 basis, Kreger said. His estimate is similar, as as he expects $40 million higher revenue and a 60-65-cent EPS increase on an ASC 605 basis.

“We view the strong biotechnology funding environment as an ongoing positive for all of the CROs, but particularly for Medpace given its larger exposure to smaller clients,” the analyst said.

William Blair expects Medpace to perform well in the second half of the year and in 2019.

https://bit.ly/2n0cw4q

Heat therapy boosts mitochondrial function in muscles

A new study finds that long-term heat therapy may increase mitochondrial function in the muscles. The discovery could lead to new treatments for people with chronic illness or disease. The study — the first of its kind in humans — is published ahead of print in the Journal of Applied Physiology.

Mitochondria, the “energy centers” of the cells, are essential for maintaining good health. A decrease in the number or function of mitochondria may contribute to chronic and potentially serious conditions such as heart disease, chronic obstructive pulmonary disease and type 2 diabetes. Exercise has been shown to create new mitochondria and improve function of existing mitochondria. However, some people with chronic illnesses are not able to exercise long enough — previous research suggests close to two hours daily — to reap the benefits. Rodent studies have suggested that heat exposure may also induce the production of more mitochondria.

Researchers from Brigham Young University in Utah studied 20 adult volunteers who had not participated in regular exercise in the three months prior to the study. The research team applied two hours of shortwave diathermy — a type of heat therapy generated by electrical pulses — to the thigh muscles of one leg of each person every day. The researchers based the six-day trial of heat on the minimum amount of exercise needed to measure changes in muscle, or about two hours each day. They designed the treatment to mimic the effects of muscle heating that occurs during exercise. The therapy sessions increased the temperature of the heated leg by approximately 7 degrees F. Each participant’s other leg served as a control, receiving no heat therapy or temperature change. The researchers looked at mitochondria content in the muscles on the first day of therapy and 24 hours after the last treatment.

Mitochondrial function increased by an average of 28 percent in the heated legs after the heat treatment. The concentration of several mitochondrial proteins also increased in the heated legs, which suggests that “in addition to improving function, [repeated exposure to heat] increased mitochondrial content in human skeletal muscle,” the research team wrote.

“Our data provide evidence to support further research into the mechanisms of heat-induced mitochondrial adaptations,” the researchers explained. People who are not able to exercise for long periods of time due to their health may benefit from [heat] treatments.

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Story Source:

Materials provided by American Physiological Society. Note: Content may be edited for style and length.

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Journal Reference:

1. Paul Samuel Hafen, Coray N Preece, Jacob R. Sorensen, Chad R. Hancock, Robert D. Hyldahl. Repeated exposure to heat stress induces mitochondrial adaptation in human skeletal muscle. Journal of Applied Physiology, 2018; DOI: 10.1152/japplphysiol.00383.2018

https://bit.ly/2NWQ5ZC