Fate Collaborates with ONO on Off-the-Shelf CAR-T Cell Cancer Immunotherapy

Fate Therapeutics, Inc.(NASDAQ: FATE), a clinical-stage biopharmaceutical company dedicated to the development of programmed cellular immunotherapies for cancer and immune disorders, announced today that it has entered into a collaboration with ONO Pharmaceutical Co., Ltd. for the joint development and commercialization of two off-the-shelf CAR-T cell product candidates. Using Fate Therapeutics’ proprietary induced pluripotent stem cell (iPSC) product platform, the two CAR T-cell collaboration candidates will each be derived from a clonal master iPSC line engineered to completely eliminate endogenous TCR expression, insert a chimeric antigen receptor (CAR) into the TRAC locus and incorporate other anti-tumor functionality. This transformative approach enables the cost-effective production of cell-based cancer immunotherapies that are uniformly engineered, extensively characterized and homogeneous in composition, and can be consistently and repeatedly mass produced and delivered to patients in an off-the-shelf manner.

“We are delighted to collaborate with ONO, a global leader in oncology with a long history of developing innovative breakthrough cancer drugs,” said Scott Wolchko, President and Chief Executive Officer of Fate Therapeutics. “This partnership with ONO enables Fate to further enhance its expertise in targeting solid tumors and to accelerate the global development of our pipeline of off-the-shelf, iPSC-derived CAR-T cell product candidates.”

Under the terms of the strategic option agreement, Fate Therapeutics and ONO will jointly advance each iPSC-derived CAR-T cell collaboration candidate to a pre-defined preclinical milestone. The first iPSC-derived CAR T-cell candidate targets an antigen expressed on certain lymphoblastic leukemias, and Fate Therapeutics retains global responsibility for development and commercialization with ONO having an option to assume responsibilities in Asia. The second candidate targets a novel antigen identified by ONO expressed on certain solid tumors, with ONO having an option to assume global responsibility for further development and commercialization and Fate Therapeutics retaining the right to co-develop and co-commercialize the candidate in the United States and Europe. For both collaboration candidates, Fate Therapeuticsretains manufacturing responsibilities on a global basis.

“ONO identified Fate Therapeutics as the partner of choice for the generation of off-the-shelf CAR T-cell cancer immunotherapies in our portfolio,” said Hiromu Habashita, Corporate Officer, and Executive Director of Discovery & Research of ONO. “We are excited to work with Fate Therapeutics and apply its industry-leading iPSC product platform to develop and deliver the next-generation of CAR T-cell therapies for cancer patients.”

Fate Therapeutics will receive an upfront payment and committed research funding during the preclinical option period, and is eligible to receive a preclinical option exercise fee, clinical, regulatory and commercialization milestone payments and tiered royalties on net sales by ONO in connection with the development and commercialization of each collaboration product by ONO in the ONO territory.

https://www.marketscreener.com/FATE-THERAPEUTICS-INC-14297698/news/Fate-Therapeutics-Announces-Strategic-Collaboration-with-ONO-Pharmaceutical-to-Develop-Off-the-She-27273832/

Ionis: Potential breakthrough Huntington’s med to advanced trial

A potential breakthrough drug for treating Huntington’s disease from Carlsbad’sIonis Pharmaceuticals will begin an advanced clinical trial early next year. If successful, the trial could lead to marketing approval.

Ionis partner Roche, which is handling the clinical trials, made the announcement Sunday. The trial will take place globally.

Huntington’s disease is an incurable and invariably fatal neurodegenerative disease caused by mutations in one gene. More than 30,000 Americans have the mutation, and either have the disease or will eventually develop it.

The age of onset varies with the mutation’s severity. Most often, symptoms appear in middle age. These include uncontrollable movements and problems with emotions and cognition, along with changes in personality. In advanced cases, patients have trouble speaking or swallowing.

Existing treatments only manage symptoms. There is no treatment that stops or even slows down the disease’s progression.

The mutation causes production of an abnormal form of a protein called huntingtin, which is essential for brain development. It is genetically dominant, meaning that only one copy of the gene, inherited from either parent, causes Huntington’s.

The drug, RG6042, (originally IONIS-HTTRx) inhibits production of the mutant huntingtin. It uses an Ionis technology called antisense, which blocks or changes genetic activity. All Ionis drugs use antisense.

Inhibiting production of the protein in theory should slow, stop or even reverse the disease. Early clinical testing has shown that the drug does inhibit huntingtin production and provided preliminary evidence of some benefit. But efficacy can only be proven by the more advanced trial.

Success “would be a historic moment for Huntington’s disease patients, their loved ones and the health care providers who treat and take care of HD patients,” said C. Frank Bennett, senior vice president of research at Ionis, in a statement. “It also would be an important advance for the neurodegenerative field in general.”

Ionis has already successfully developed a drug effective against another previously untreatable neurological disease, spinal muscular atrophy, which in its severest form can kill in infancy. Called Spinraza, it’s sold by partner Biogen.

Ionis is also developing drugs for Alzheimer’s and ALS, two other incurable and fatal neurodegenerative diseases.

Ionis developed RG6042 in collaboration with researchers from the lab of Don W. Cleveland at UC San Diego. It is injected into the spinal fluid, enabling it to reach the brain. Roche licensed the drug last December, assuming the lead in development.

The trial will be double-blinded, meaning that neither doctors nor patients will know who is getting the drug and who is getting a placebo. The drug — or placebo — will be given to up to 660 patients manifesting Huntington’s symptoms over 25 months, Roche said in its announcement. They will be treated at about 80 to 90 sites worldwide.

More information on the upcoming Phase 3 trial once it gets underway, along with trials of other Huntington’s drugs, can be found at http://www.hdtrialfinder.org and http://www.clinicaltrials.gov. In addition, Kenneth Serbin, a San Diegan who carries the mutation, writes about Huntington’s at http://curehd.blogspot.com.

https://www.marketscreener.com/IONIS-PHARMACEUTICALS-INC-25500637/news/Ionis-Pharmaceuticals-Potential-breakthrough-drug-for-Huntington-s-to-enter-advanced-clinical-test-27274169/

Goldman Life Science Pair Trade: Buy Agilent, Sidelines On Thermo Fisher

Goldman Sachs has a pair trade in the life sciences tools and diagnostics space ahead of third-quarter earnings season.

The Analyst

Analyst Patrick Donnelly maintained a Buy rating on Agilent Technologies Inc A 0.33% and increased the price target from $77 to $82.

The analyst added Agilent to Goldman’s Americas Conviction List and also named it as a top pick.

At the same time, Donnelly downgraded shares of Thermo Fisher Scientific Inc. TMO 1.45% from Buy to Neutral and maintained a $250 price target.

The analyst removed the stock from the Americas Conviction List.

The Thesis

Both Agilent and Thermo Fisher have sound fundamentals and are poised for “beat-and-raises” over the next several quarters, Donnelly said in a Monday note. (See his track record here.)

Donnelly said he prefers Agilent’s setup and views Thermo Fisher’s growth acceleration and margin expansion as being priced into the stock.

Agilent: A Premium Growth Story In Tools

Agilent is a premium growth story in tools on the basis of its ability to accelerate organic growth heading into 2019 despite concerns about China trade headwinds, Donnelly said. China accounts for about 20 percent of the company’s revenues, he said.

Agilent has a clean path to growth in the fourth quarter and in 2019 amid support from “continued momentum in CrossLab, Intuvo/Ultivo product cycle ramps, a rebound in China food and environmental orders and the expansion of the Oligo facility,” the analyst said.

Intuvo and Ultivo should be key drivers over the next 12-24 months, with the former expected to make meaningful contributions in 2019, potentially adding about 1 percent to organic growth in 2019 and 2020, Donnelly said.

“We continue to see valuation for Agilent as undemanding and see upside for multiple expansion as investors turn to the layering of organic growth drivers.”

Thermo Fisher’s Setup Becomes More Demanding

There is limited upside to Goldman’s price target for the shares of Thermo Fisher, as the stock’s valuation already reflects the prospects for organic growth acceleration, Donnelly said.

“While we remain constructive on the fundamental story for TMO, we prefer to remain on the sidelines, as the setup over the next year gets more demanding driven by more normalized top-line impacts from FEI.”

https://www.benzinga.com/analyst-ratings/analyst-color/18/09/12363481/a-life-science-tools-and-diagnostics-pair-trade-goldman

JMP: Changing Competitive Landscape Makes Revance Less Appealing

Revance Therapeutics Inc RVNC 8.28%, a biotech company developing a botulinum toxin product, could face a competitive backlash, according to JMP Securities.

The Analyst

Analyst Donald Ellis downgraded Revance from Market Outperform to Market Perform.

The Thesis

The downgrade of Revance is based on Allergan plc AGN 2.08%‘s recently released data in Botox responders showing that 80 units of Botox 80 produced a more than 1-point improvement in 24 weeks in 39 percent of study patients, Ellis said in a Monday note. (See his track record here.)

Revance is testing RT002, daxibotulinumtoxinA injection, in a Phase 3 study for Glabellar Lines while also pursuing Phase 2 trials for cervical dystonia and plantar fasciitis.

Revance’s RT002 showed similar improvement in about 42 percent of study population, the analyst said.

“AGN’s data suggest that the longer duration of activity for RT002 may be partially or primarily due to a ‘dose’ effect,” Ellis said.

Allergan’s recent data minimizes the benefit of extended duration claims for RT002 vs. Botox, the analyst said.

The FDA requires a more than or equal to 2-point improvement, and none or mild on wrinkle severity, which both companies have not disclosed, he said.

JMP does not expect the companies to make 24-week claims.

“AGN can educate doctors on longer duration with higher doses at medical conferences, but its reps cannot legally promote longer duration directly to doctors,” Ellis said.

https://www.benzinga.com/analyst-ratings/analyst-color/18/09/12364033/jmp-changing-competitive-landscape-makes-revance-less-a

Hedge fund backs away from Athenahealth deal

Paul Singer’s Elliott Management has backed away from its $160-a-share bid for Athenahealth, The Post has learned.
At the same time, other suitors — including some strategic companies that had made initial inquiries — have also gone quiet, sources close to the situation said.
As a result of Singer’s retreat and the lack of robust interest from others, Athena has extended a final bid deadline by 10 days — to Sept. 27, sources said.
Singer backing off the promised bid is a stark turnaround in the battle for the health care tech company.
Elliott succeeded in a tough activist fight to get Athena to oust founder and Chief Executive Jonathan Bush, a cousin of former President George W. Bush, and to put the company up for sale.
Singer’s firm in May said it was prepared to pay $6.9 billion for Athena — contingent on due diligence.
“There has been a lot of speculation on Elliott’s motives” for saying in May it was prepared to pay $160, an industry source said.
“It feels now like they never really wanted to own it,” and were just setting a floor for the auction, the source said.
Meanwhile, Elliott might have learned upon doing diligence that there were unexpected problems at the medical records software company, sources said.
In June, weeks after Singer’s $160 offer, Athena shares topped out at $163.94. The shares on Monday closed at $142.09, down $1.07.
Speculation in health care circles is that Athena will see sub-$150-a-share bids, sources said.
The remaining suitors, including Elliott, which is teaming with Bain Capital on its bid, are likely trying to see what Athena will take in a face-saving sale, sources said.
“Without a deal, the shares could fall to $120 a share,” the industry source said.
“It would not be totally shocking” if now there is no sale, a source with direct knowledge of the situation said.
The New Yorker in its Aug. 27 cover story on Singer, the 74-year-old activist investor, portrayed Athena as the poster child for how activists force short-term changes at companies that hurt them in the long run.
Athena CEO Bush on June 6 resigned under Elliott’s pressure. Executive Chair Jeffrey Immelt, the former GE chief, has now taken a leading role at Athena.
In May, Elliott said its offer was subject to regulatory approvals and a robust review.
The hedge fund called out Athena’s underperformance relative to peers, and the parade of five chief financial officers in the span of four years.
One hedge fund that may be relishing the delayed Athena sales process is David Einhorn’s Greenlight Capital.

 

 

 

The $5.5 billion hedge fund, which was down 25 percent through Aug. 31, has been shorting Athena shares.
“Our take is that the activist has little interest in actually buying the company, but hopes someone else does,” Einhorn said in a July letter to his investors.
https://nypost.com/2018/09/17/paul-singers-hedge-fund-backs-away-from-athenahealth-deal/

Why payers are gobbling up PBMs

With the OK from the Justice Department, Cigna’s nearly-final takeover of Express Scripts moves closer to the end of an era when standalone pharmacy benefit managers dominated the industry.

Pending remaining state approvals for that $67 billion pact and the expected clearance of the CVS-Aetna megamerger, the three largest PBMs will all be hitched to health plans. UnitedHealth created its own in 1990 with OptumRx.

The crowded landscape has drastically changed from just a decade ago when PBMs were scooping up competitors and morphed the sector into one dominated by a few behemoths controlling the prescription drug benefit for millions of Americans.

Over time, PBMs went from simply processing prescription claims, largely an administrative function, in the late 1960s to now serving as the gatekeeper to prescriptions through formularies and pharmacy networks. They also play a controversial role in pricing as they negotiate directly with drug manufacturers but reveal little about how those savings are passed onto consumers.

Over the past few years, payers have become increasingly interested in bringing the function in-house, dissolving their relationships with independent PBMs to launch their own, or acquiring others to do so.

“I think it’s a natural evolution of where this industry needs to go,” Ana Gupte, an analyst for Leerink Partners, told Healthcare Dive. “At the end of the day, the pharmacy benefit is integral to management of an insured member as a whole person.”

A case for savings

By combining both the medical and pharmaceutical benefit under one umbrella, analysts say you can potentially achieve greater costs savings than may have been possible with separate entities. For example, if a patient is prescribed a particular drug the overall drug spend may increase, but it could result in savings on the medical side if it prevents a costly hospital visit.

“Now you have a better coordination of care when you have both of those under one roof,” John Boylan, an analyst with Edward Jones, told Healthcare Dive.

That’s particularly important as spending has dramatically increased for specialty drugs that treat complex diseases. Some specialty drugs need to be administered in a healthcare setting, so it may be covered under the medical benefit. But some can be covered under the pharmacy benefit or even both, according to Adam Fein, CEO of Drug Channels Institute.

Specialty drugs represent 40% of overall drug spending for Express Scripts, yet only 1% of their members use a specialty drug, according to the company.

“Total specialty drug spending is split between medical and pharmacy benefits. Patients on specialty drugs also tend to have higher medical expenses, so integrated medical-pharmacy management is crucial,” Fein wrote in April.

Plus, if covered by pharmacy but administered in a hospital or doctor office, “PBMs are not able to control that channel because they have no leverage over the provider,” Gupte said.

Combined, the companies are better poised to deal with this problem, Boylan said.

Role in drug pricing controversy

At the same time, PBMs have faced increased scrutiny over the years as drug prices continued to soar, raising questions about their effectiveness in reining in costs. The debate surrounding PBMs really caught fire when Mylan Pharmaceuticals CEO Heather Bresch in part blamed PBMs for the rise in price while she faced criticism for raising the list price of EpiPen, a lifesaving antidote for those suffering an allergic reaction.

“Drug pricing is becoming a mainstream national issue,” Brian Tanquilut, an analyst with Jefferies, told Healthcare Dive.

But as drugmakers took heat, they pointed fingers at others in the healthcare ecosystem, including hospitals and PBMs.

The Trump administration has been particularly aggressive in taking on the industry, showing an interest in curbing the rebates, as well as overhauling safe harbor protections that shield PBMs from anti-kickback lawsuits.

Tanquilut thinks the increased scrutiny has played a role in fueling these payer-PBM acquisitions.

PBMs decide which drugs they will cover each year for their members and, to get a preferred status, drug manufacturers agree to rebates or discounts. It’s unclear how much of that savings actually makes it way back to patients. PBMs also use spread pricing — pocketing the difference between what they charge the pharmacy and what they bill their client.

“The black box model is under scrutiny,” Tanquilut said. “It’s better for them to be embedded. You can kind of hide your economics.”

https://www.healthcaredive.com/news/why-payers-are-gobbling-up-pbms/532224/

Piper Jaffray Upgrades Acceleron Pharma (XLRN) to Overweight

Piper Jaffray analyst Danielle Brill upgraded Acceleron Pharma (NASDAQ: XLRN) from Neutral to Overweight with a price target of $75.00 (from $52.00).

The analyst says the Luspatercept opportunity has been de-risked and likes the equity noting the royalty stream remains under-appreciated.

https://www.streetinsider.com/Analyst+Comments/Piper+Jaffray+Upgrades+Acceleron+Pharma+%28XLRN%29+to+Overweight/14615162.html