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Tuesday, March 5, 2019

Gottlieb said to resign

U.S. Food and Drug Administration Commissioner Scott Gottlieb is resigning, according to a person familiar with the matter, ending a tenure marked by a flood of new drugs and a push for sharp curbs on e-cigarette use.
Gottlieb, 46, had been in the middle of putting sharp new restrictions on electronic cigarettes, citing an “epidemic” of youth vaping that he said he feared could lead to new smokers.
Under his watch, approvals for totally new drugs soared to 59 in 2018 from just 22 in 2016, the last year of the Obama administration.
He was also a key part of the Trump administration’s push to lower drug costs. Those efforts focused on approving hundreds of new generic drugs, as well as targeting drug industry tactics he and others blamed for keeping prices high.

Psychemedics hit after Q4 report, risks in Brazil

Thinly traded nano cap Psychemedics (PMD -19.6%) slumps on a 9x surge in volume following its Q4 report released after the close yesterday. Highlights:
Revenues were up 2% to $9.9M, net income down 63% to $643K, EPS down 62% to $0.16.
The company says its business in Brazil is more uncertain after a healthcare services provider there acquired 55% of its independent distributor Psychemedics Brasil. It is currently in talks about the future of their distribution agreement, which either party may cancel after July. As backup, it is “exploring additional options” in the country.
Previously: Psychemedics reports Q4 results (March 4)

Otonomy’s Otividex could be $500M+ product if approved, says Piper Jaffray

Piper Jaffray analyst Tyler Van Buren maintained an Overweight rating on Otonomy following the company’s Q4 earnings report and pipeline updates. In a research note to investors, Van Buren says he believes the Phase III Otividex trial has a “great chance” of success given the positive body of data reported to date, and believes it could be a $500M+ product if approved, which is not being reflected int he current valuation. Additionally, the analyst notes that the company is initiating Phase 1/2 clinical trials for OTO-313 in tinnitus next quarter and OTO-413 in speech-in-noise hearing loss in Q3, all three of which will have significant clinical data readouts during 2020.
https://thefly.com/landingPageNews.php?id=2874565

Marrow transplant sparks long remission in 2nd HIV patient, renews hope for cure

The cautiously optimistic call it sustained remission, others are hopeful it is a cure — but the doctors are impressed. An unnamed patient in London, once afflicted with cancer and the virus that causes AIDS, is free of both, courtesy an immune system overhaul triggered by a bone marrow transplant from an HIV-resistant donor.
The case comes a dozen years or so after the “Berlin patient” — now identified as Timothy Ray Brown — who achieved sustained remission following the same procedure for his leukemia. Although Brown underwent two transplants, was given total body irradiation no longer in use today, and was placed in an induced coma, he eventually recovered and was deemed HIV-free. Scientists took note, and tried repeatedly to duplicate the feat, but in vain.

On Tuesday researchers from University College London and Imperial College London, together with teams at the University of Cambridge and the University of Oxford, reported the second known case of sustained remission — in an individual who asked to retain his anonymity and is accordingly just referred to as the “London patient”.
Both Brown and the London patient received donations from donors with two copies of the allele that prevents the expression of CCR5, a gene commonly used by HIV as a back door into a cell. The trait is naturally common in parts of Northern Europe and confers the ability to resist an HIV infection from the AIDS virus. It is this trait that rogue Chinese scientist Jiankui He attempted to confer via gene editing in his widely condemned CRISPR experiment earlier this year that culminated in the birth of two genetically modified twin baby girls.
The London patient was diagnosed with an HIV infection in 2003, and in 2012 he began taking antiretroviral (ARV) therapy. Later that year, it was confirmed he had advanced Hodgkin’s Lymphoma. On top of chemotherapy, he underwent the stem cell transplant in 2016. The surgery was relatively uncomplicated, but not without side effects, including mild graft-versus-host disease.
Chemotherapy can be used to thwart HIV as it snuffs out cells that are dividing – and the researchers suggest that replacing immune cells devoid of the CCR5 receptor appears to be the crucial ingredient precluding HIV from making a comeback.

Following the transplant, for 16 months the London patient was given ARV therapy, after which his treatment was interrupted to evaluate whether he was truly in HIV remission. Regular and sensitive testing has confirmed that the patient has indeed remained in remission 18 months since ARV therapy was ceased.
“We need to understand if we could knock out this receptor in people with HIV, which may be possible with gene therapy,” said lead author of the study Ravindra Gupta, in a statement.
Gupta was at UCL when the study — to be published in the journal Nature on Tuesday — was conducted; he has since moved to the University of Cambridge.
“While it is too early to say with certainty that our patient is now cured of HIV, and doctors will continue to monitor his condition, the apparent success of haematopoietic stem cell transplantation offers hope in the search for a long-awaited cure for HIV/AIDS,” added Professor Eduardo Olavarria from Imperial College London.
According to the WHO, there are nearly 37 million people globally living with HIV — of which roughly 60% are on ARV, as of 2017. Once a death sentence, the virus that causes AIDS is typically suppressed using ARV therapy and is now upgraded to the position of a chronic disease.

Monitoring mail-order DNA

Today’s mail-order molecule could help build the next great vaccine. Or it could unleash the next deadly epidemic.
That’s the conundrum faced by the Bay Area’s gene synthesis companies, which screen thousands of requests for custom-built DNA — and the customers who want them — to make sure that tomorrow’s Hitler isn’t ordering up the next smallpox, Ebola or yet-unnamed killer.
“If there’s some weird order from some weird place, it raises a red flag,” said Claes Gustafsson, co-founder and chief commercial officer of ATUM, a Newark-based gene synthesis company.
The companies’ approach — a shared database and screening techniques, established voluntarily by a trade association — isn’t perfect.
But it represents a rare instance of competitive companies successfully regulating their own cutting-edge field to protect us from possibly perilous pathogens. Their responsibility grows as it gets ever cheaper, faster and easier for almost anyone to stitch together the chemicals that make life.
“I think the fact that they have been so willing to monitor themselves helps us identify the places where there are gaps in regulation, where our vulnerabilities lie,” said Mildred Cho of the Center for Biomedical Ethics at Stanford.
The burgeoning field of gene synthesis is possible because of this simple fact: Life is just information.
Four molecules — each called a “base,” the most irreducible unit of life, represented by the letters A (adenine), T (thymine), G (guanine) and C (cytosine) — spell the words that write the dictionary of creation.
The sequence of these letters dictates whether you spell out the makings of a cowpox virus or the starting pitcher for the Yankees.
The ease of building these sequences — and the lower costs as technology has improved — has spurred the growth of companies like ATUM and San Francisco’sTwist Bioscience, where armies of machines spit out accurate and custom-designed strands of DNA.
The benefits are many and profound, leading to new therapies, non-fossil fuels, and more resilient agricultural crops. While the promise of “gene editing” through CRISPR techniques has received a lot of attention, gene building could be a potentially more efficient technology. Rather than changing a gene sequence, you can build the sequence from scratch.
But along with these advances have come new biosecurity threats, where sequences are designed for harm. Some sequences have dual uses, either good or deadly. For instance, research based on the gene sequence of Ebola virus could help accelerate the design and production of new vaccines. But the same gene sequence, in the wrong hands, could unleash terror.
The federal government has a short list of regulated organisms. But the government’s ban focuses on the organisms themselves, rather than the genetic instructions for making them.
Because the government has not published those sequences, the companies must decide for themselves whether a mail order request is potentially dangerous.
The companies face a challenge: How do they know when someone is building a biological bullet? While the government calls on companies to screen both customers and the ordered DNA sequences, this is a voluntary rather than regulatory approach.
To help, leading companies have organized and created their own database and biosecurity practices, in line with federal guidelines, through a trade association called the International Gene Synthesis Consortium. Members include two Bay Areacompanies — ATUM and Twist Bioscience — as well as 10 other major companies which provide an estimated 80 percent of the world’s synthetic genes.
Each order is screened against the group’s database, which includes whole genomes of pathogenic species, subspecies and toxin genes.
And every customer is screened using software, which combs through the U.S.government watch lists for terrorists and traffickers of weapons of mass destruction.
Companies also check for an institutional affiliation. They don’t sell DNA to unaffiliated individuals or ship to P.O. boxes.
“If we received an order to make the Ebola virus, screening the customer would play a very important role, after the sequence was flagged as dangerous,” said biochemist Emily Leproust, co-founder and CEO of Twist Bioscience.
“If it were the U.S. Centers for Disease Control ordering the virus, then after confirming all of the appropriate information, we would make the DNA and ship it,” she said. “If, on the other hand, the order came from an individual who was ordering the DNA to be shipped to a P.O Box in Iran, we would not ship it.”
The consortium has adopted a common “red-yellow-green” approach for their screening.
Safe sequences are considered “green,” and the order is quickly filled. A “yellow” hit has a sequence that is similar to a pathogen but is not itself deadly. A “red” sequence belongs to a known pathogen.
For each yellow or red hit, the company writes or calls the customer’s safety officer to learn if there is a legitimate reason for the order. If the person cannot be verified or has no legitimate reason to order that DNA, they may be reported to the FBI.
“You never want to send it to an address for the cave in Afghanistan,” said Gustafsson.
Fewer than 1 percent of orders are determined to be dangerous “red” hits, according to an analysis by the J. Craig Venter Institute, a La Jolla-based genomic research institute.
Federal enforcement falls short, asserted Xue-Nong Zhang of Epoch Life Science in Missouri City, Texas, which is not a member of the consortium but according to Zhang, abides by its own security measures. Zhang said he was even interviewed by the FBI more than a decade ago, and wrote that he found astonishing “the ignorance of the government and disconnection between different agencies.”
The proliferation of companies is prompting questions about whether strategies for preventing the microbial mayhem need to be rethought.
An estimated 10 to 20 American gene-synthesizing companies aren’t members, according to the consortium. Some, such as Epoch, may have their own internal guidelines; others don’t, saying they lack the time and specialized knowledge, according to the Venter Institute analysis.
International players, particularly Chinese companies, are rapidly increasing their share of the market. And it is becoming easier for almost anyone to build a gene.
“With all the basic equipment needed to do gene synthesis flying around every corner of the world and free knowledge available unlimited, plus raw material providers synthesizing millions of bases of DNA every day unscrutinized — how on earth are you going to prevent someone’s use of this technology for harmful purpose?” asked Zhang.
The real problem might not be bioterrorists, but established scientists who make unintentional mistakes, added Stanford’s Cho, who recommends extra attention by internal institutional reviewers.
Sam Weiss Evans, an assistant professor with the Program on Science, Technology, and Society at Tufts University, said regulators need to specify what part of a gene sequence — and how much of this sequence — makes it deadly.
But he warned that might not be enough. Because microbes’ behavior is controlled by an intricate balance of gene expression, protein folding and other factors, the mere presence of a gene may not necessarily mean trouble, he said. And increasingly, companies make short DNA strands that are so tiny they lack any “fingerprint” that might identify them as part of something dangerous.
Finally, rules that focus solely on dangerous sequences miss the evil-doers who order benign strings of DNA and then reassemble them to create a threat, said Jennifer Doudna, a biochemist at the University of California, Berkeley, and a pioneer in CRISPR gene editing research.
“It is a very big challenge,” said Doudna. “How can we be sure that you are checking all the ways that information can be encoded against all of the orders being placed around the world every single day?”

Universal Health price target raised to $146 from $130 at BMO Capital

BMO Capital analyst Matt Borsch raised his price target on Universal Health to $146, citing its above-consensus outlook for 2019 announced last week. The analyst states that while the company remains “reliant on continued acute-care strength”, the forecast has given him a better “view of expectations now that management has backed away from promises of near-term improvement in the behavioral side, which should strengthen its credibility.” Borsch is keeping his Market Perform rating on Universal Health however, noting that its current valuation of enterprise value to EBITDA at 9.1-times is “fair” and implies only modest stock price upside.
https://thefly.com/landingPageNews.php?id=2874429

Endo downgraded to Market Perform from Outperform at SVB Leerink

SVB Leerink analyst Ami Fadia downgraded Endo to Market Perform from Outperform due to a further step-down in the generics business in 2019, and the potential overhang from the opioid litigation. The analyst also lowered her price target on the shares to $10 from $13.
https://thefly.com/landingPageNews.php?id=2874305