Shares of Rite Aid Corp. RAD, +6.10% rose 3% in the extended session Tuesday after the drugstore chain said that Chief Executive John Standley and other top executives are leaving the company amid a restructuring aimed at cutting costs. Rite Aid will “reduce managerial layers and consolidate roles across the organization,” eliminating about 400 full-time positions, or more than 20% of the corporate jobs at its headquarters in Pennsylvania and across the company. About two-thirds of the layoffs will take place immediately, with the rest taking place by the end of fiscal 2020, Rite Aid said. The company hopes to reach annual cost savings of around $55 million with the reorganization, of which about $42 million will be realized within fiscal year 2020, it said. Rite Aid expects a one-time restructuring charge of approximately $38 million to achieve the hoped-for savings. In addition to Standley, Chief Operating Officer Kermit Crawford, Chief Financial Officer Darren Kast, and Executive Vice President Derek Griffith are leaving the company. Standley will stay on the job until a successor is appointed, Rite Aid said. “These are difficult decisions and we recognize the implications they have for individuals across our organization. However, it is imperative we take action to reduce the cost of current operations and become a more efficient and profitable company,” board chairman Bruce Bodaken said in a statement.
Tuesday, March 12, 2019
Aeterna Zentaris to Review Strategy, Hires Financial Advisor
Aeterna Zentaris Inc. AEZS, +6.23% (AEZS) announced today that its board of directors has formed a special committee of independent directors (the “Special Committee”) to review strategic options available to Aeterna Zentaris.
The Special Committee has approved the engagement by the Company of Torreya, a global investment bank specializing in life sciences, as its financial advisor. Torreya is working with management to assist the Special Committee and the board of directors in considering a wide range of transactions (including opportunities for the license of macimorelin outside of the United States and Canada, other monetization transactions relating to macimorelin or the potential sale of the company) which may create value for the company, its shareholders and other stakeholders.
There is no defined timeline for the strategic review. The review of strategic alternatives may result in a variety of outcomes or no outcome and there can be no assurance that Aeterna Zentaris will pursue or execute any specific action or transaction. Aeterna Zentaris currently does not intend to make any further announcements or comments regarding its review of strategic alternatives unless required by law.
Does Bristol-Myers have a plan B if activists scuttle its Celgene buy?
What’s Bristol-Myers Squibb’s Plan B if its Celgene deal falls through? BMS won’t say whether it has one at all. And the company may be more likely to need a backup plan than some industry-watchers think.
As Wolfe Research’s Tim Anderson pointed out in a note to clients, the company has so far skirted questions about how it would proceed without the $74 billion takeout, saying only that “their focus is on getting the Celgene deal done.”
“They gave no insights on the path forward under this alternative scenario,” Anderson wrote, noting that if the deal doesn’t happen, Bristol’s past “string-of-pearls” strategy, which focused on small acquisitions, may not be enough to take it into the future.
And the way he sees it, it might be time to think about alternatives. Activist investor Starboard Value has already started working to take down the merger, and top shareholder Wellington Management has come out against it, too.
Anderson and his colleagues are hearing from other investors that “there continues to be uneasiness about the merits of the transaction and what the combined company will be capable of delivering to shareholders.”
Other analysts, though, have said they still expect the deal to close as planned.
“Wellington, even combined with similarly positioned funds, lacks the votes to sway the deal outcome,” Atlantic Equities analysts wrote recently. And Starboard’s stake is even smaller.
Meanwhile, though BMS may not be focusing on different endings to the Celgene story, other biopharma companies might be. Anderson—who has long contended that Bristol’s I-O struggles could make it a takeout target—suspects that its “actions are in fact partly designed to prevent itself from being acquired.”
“Management stopped short of saying whether there has been any informal indication of interest in BMS by another party, which still leaves open a possible motive for the transaction,” he wrote, adding that “whether there was informal interest recently, or whether [the company] is merely anticipating this as a future risk, is not clear.”
Also unclear? Which company could—and would—swallow a drugmaker of Bristol’s size. Many of the best-equipped companies, including Pfizer and AbbVie, have come out against megadeals in recent weeks.
Amphastar reports Q4 EPS 13c, consensus 11c
Reports Q4 revenue $89.7M, consensus $78.18M. The company currently has five abbreviated new drug applications, or ANDAs, filed with the FDA targeting products with a market size of over $750 million, three biosimilar products in development targeting products with a market size of over $14 billion, and 11 generic products in development targeting products with a market size of over $12 billion. This market information is based on IQVIA data for the 12 months ended December 31, 2018. The Company’s proprietary pipeline includes a new drug application for intranasal naloxone. The Company is currently developing four other proprietary products, which include injectable, inhalation and intranasal dosage forms.
https://thefly.com/landingPageNews.php?id=2878141
https://thefly.com/landingPageNews.php?id=2878141
Use of Glaukos iStent implantation produced 38% reduction in IOP
Glaukos announced that results of an international glaucoma study published in the Journal of Cataract and Refractive Surgery showed use of iStent Trabecular Micro-Bypass Stent during cataract surgery delivered a 38% reduction in mean intraocular pressure, or IOP, to 14.7 mmHg after five years of follow-up. 38%of eyes had undergone prior trabeculectomy and/or glaucoma laser procedures and 68% were on at least two preoperative glaucoma medications. These results were presented in part at the 2016 annual meeting of the European Society of Cataract and Refractive Surgeons and three-year outcomes of this study were published in the Journal of Cataract and Refractive Surgery in 2015.
https://thefly.com/landingPageNews.php?id=2878165
https://thefly.com/landingPageNews.php?id=2878165
Scholar Rock to develop cancer immunotherapy product SRK-181
Scholar Rock announced that it has selected SRK-181, a highly specific inhibitor of TGFbeta1 activation, as the first product candidate in its TGFbeta1 cancer immunotherapy program based on the strength of its preclinical data and human translational insights. Scholar Rock has initiated manufacturing and is progressing preclinical development efforts with plans to initiate a Phase 1 trial in patients with solid tumors in mid- 2020. SRK-181 is a fully human antibody designed to bind to, and prevent the activation of, latent TGFbeta1 with high affinity and high selectivity, as evidenced by minimal or no binding to latent TGFbeta2 and latent TGFbeta3 isoforms. Several important factors led to the decision to advance SRK-181 as a clinical development product candidate for the treatment of tumors resistant to checkpoint blockade therapies, such as anti-PD1 antibodies.
https://thefly.com/landingPageNews.php?id=2878183
https://thefly.com/landingPageNews.php?id=2878183
Lab Space In NYC Set To Double Over Next 2 Years
Real estate for Big Apple life science companies is set to double in the next two years, providing more inventory to the rapidly growing industry that has faced a dearth of options in the city.
There is just 1.6M SF of lab space in New York City, according to a report from CBRE released this week. But that figure is set to double over the next two years, with around 1.5M SF now under development.
“New York is a top-five market for new talent, with a growing number of graduates holding degrees in biological and biomedical science,” CBRE Tri-State Director of Research and Analysis Nicole LaRusso said in a statement. “The collection of top-tier universities here, like NYU and Columbia, and in surrounding suburban markets continuously offers an impressive pool of candidates for life sciences companies.”
New York City has lagged behind places like Kendall Square in Cambridge, Massachusetts, when it comes to lab space. But in recent years, New York has worked toward positioning itself as a biotech hub.
In 2016, Mayor Bill de Blasio announced a $500M initiative to advance life sciences in the city, with the view of adding millions of square feet of lab space to the city’s supply. Last year, Alexandria Real Estate Equities reached an agreement with the city to build a 550K SF tower at the Alexandria Center for Life Sciences, adding a third building at the developer’s campus on FDR Drive between East 28th and East 30th streets. Alexandria has also bought The Bindery building in Long Island City, which it plans to reposition for life sciences, and acquired Pfizer’s headquarters on East 42nd Street with David Werner for $360M.
Taconic and Silverstein Properties jointly own the Hudson Research Center at 619 East 54th St. where the developers are planning an expansion.
CBRE noted that employment in life sciences has grown 45% in the last two decades, and funding is still on the rise. The National Institutes of Health, a major capital source for life science projects, provided $1.8B in funding to projects in New York City last year, according to CBRE, an 11% increase over 2017.
Meanwhile, venture capital provided to life sciences in the city jumped from $300M in 2017 to $611M last year.
“The exponential growth in life sciences seen in Boston and San Francisco is starting to be realized in a few other locations, including New York City,” CBRE Vice Chairman Steve Purpura, who specializes in life sciences, said in a statement.
New York City’s life sciences sector is typically dominated by smaller, early stage companies that have come out of the city’s academic institutions and medical centers. In the past, many have left the city because there was no commercial wet lab space available, BioLabs Managing Director Nicole McKnight told Bisnow last year. BioLabs provides coworking space for life science startups.
“Landlords can do a couple of things to help. They can take a risk on these startup companies that don’t necessarily have great credit,” she said at the time. “They’ve been able to raise millions in venture capital, but they aren’t your typical, top-credit companies.”
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