Novartis CEO figures M&A’s the way toward ‘transformative’ innovation

When Novartis acquired AveXis for $8.7 billion last year, it was betting the smaller company’s gene therapy for spinal muscular atrophy could soar to blockbuster levels. That therapy, Zolgensma, is closing in on FDA approval—and Novartis CEO Vas Narasimhan has ambitious plans for more M&A.

Narasimhan is just one year into his stint as CEO of the Swiss pharma giant, but he’s already established himself as a dealmaker. He not only engineered the AveXis deal last year, he also picked up the radiotherapy company Endocyte for $2.1 billion.

And now, Narasimhan says he plans to spend at least $10 billion a year on acquisitions. “We’ll have to be on top of the next wave of innovations,” he told Bloomberg, adding that he’s searching for acquisition targets that would have a “transformative effect” on Novartis.

He figures Novartis has more to offer than money, too. In anticipation of Zolgensma’s launch, Novartis acquired a former AstraZeneca manufacturing site in Colorado last week. The purchase came just weeks after the company announced plans to double the size of a manufacturing plant it’s building in North Carolina.

The additional manufacturing capacity, particularly in Colorado, could be a selling point for small gene therapy companies that might be looking to make deals with Novartis, Narasimhan told Bloomberg.

The company’s widening presence in gene and cell therapies has not come without difficulties, however. Novartis has yet to disclose its pricing plans for Zolgensma, but the expectation of a $2 million price tag has already generated controversy.

The Institute for Clinical and Economic Research (ICER) used $2 million as a placeholder price in assessing Zolgensma, and the group concluded last week that it wouldn’t be cost effective at any price over $1.5 million.

AveXis president Dave Lennon told FiercePharma that the company supports alternative payment models for Zolgensma, such as installments spread over time or outcomes-based reimbursement plans. Narasimhan echoed that sentiment in the recent interview—and provided more details about how the payment model for Zolgensma might work.

Narasimhan told Bloomberg that the payment scheme would allow payers to spread reimbursement over five years. If any patient showed signs that the gene therapy had failed within that period, Novartis would pay the insurance company back.

“We want something with a massive effect in order to make a credible case to society to invest in these medicines,” Narasimhan told Bloomberg. “I think ultimately payers will come around.”

That confidence in the payer community’s willingness to fund high-priced therapies will no doubt drive Novartis’ M&A strategy going forward. The company is looking for “bolt-on” deals to build its market share in key areas of focus like neurology and metabolic disease.

During Novartis’ fourth-quarter earnings call in January, one analyst asked Narasimhan to explain his goal of spending $10 billion a year on acquisitions. The CEO replied that the goal is actually “to do M&A in the range of up to 5% of our market cap,” which would amount to $10 billion.

The main goal, however, is to build upon “these new … advanced therapy platforms where we want to lead,” he said, adding “bolt-on M&A has to be part of that strategy.”

https://www.fiercepharma.com/pharma/novartis-ceo-looks-to-m-a-for-transformative-innovation-report

Novartis Spins Off Alcon, Eyes Innovative Medicines Margin Improvements

Novartis AG (NOVN.EB) said Tuesday it has completed its spinoff of the Alcon eye-care devices business and said it plans to improve core margins in innovative medicines by 2022.

The Swiss pharmaceutical company said the Alcon spinoff was carried out via a dividend-in-kind distribution to Novartis shareholders and American Depository Receipts holders. Each holder received one Alcon share for every five Novartis shares or ADRs held at the close of business on April 8, the company said.

Novartis said the spinoff gives it a financial profile close to that of its industry peers, and said it is well-positioned for sustained top- and bottom-line growth. The company plans to improve innovative medicine core margins into the mid-30s by 2022.

Vas Narasimhan, chief executive of Novartis, said: “We continue to reimagine ourselves as a leading medicines company powered by breakthrough medicines, data science and advanced therapy platforms.”

Novartis said it plans to continue paying a “strong and growing” annual dividend up from the 2.85 Swiss francs ($2.85) a share paid in 2019, with no adjustments for the Alcon spinoff.

The company said it expects to complete its previously announced share-buyback program of up to $5 billion by the end of the year.

https://www.marketscreener.com/NOVARTIS-9364983/news/Novartis-Spins-Off-Alcon-Eyes-Innovative-Medicines-Margin-Improvements-28374147/

NYC Health Dept to Yeshiva Schools: Let Unvaccinated Students In At Own Peril

New York City officials are cracking down on schools in Brooklyn that allow unvaccinated children to attend, telling them to comply or be shut down.

Neighborhood officials said the vast majority of Orthodox Jews in Williamsburg are vaccinated, but because the community is so tightly knit, just a small number of anti-vaxers is allowing this outbreak to grow, CBS2’s Ali Bauman reported Monday.

“There is no religious exemption on measles,” said Gary Schlesinger, CEO of Parcare Community Health Network. “All rabbis, all prominent rabbis have issued proclamations that everyone should vaccinate.”

Schlesinger is trying to reverse false information being spread about the measles vaccine through the Orthodox community.

“They’re spreading this information through hotlines, some publications. I’ve seen some mailings,” Schlesinger said.

Since the measles outbreak began in October, the Department of Health says there have been 285 reported cases in Brooklyn’s Orthodox Jewish community, 246 of which are children. And so far, 21 people have been hospitalized.

As a result, the health department now says any yeshiva school in Williamsburg allowing unvaccinated students to attend will face fines or possibly be shut down.

“If you ask me, I say do it. Immunize your child, save lives,” one resident said.

“It has nothing to do with Judaism. People are afraid. It’s damaging. People are afraid of the medicine,” another person said.

City Councilman Stephen Levin represents Williamsburg.

“Every child has to be registered and we can work with the schools to do this,” Levin said.

In Rockland County, there have been 167 confirmed cases of measles. On Friday, a Supreme Court judge blocked an executive order banning unvaccinated children from public places.

“It’s happening around New York state. It’s only going to spread unless we fix the problems in the system, and the problems are we have way too lax of a requirement,” state Sen. David Carlucci said.

New York City ordered yeshivas to ban unvaccinated students in December, but said one in Williamsburg did not comply and has since been linked to more than 40 cases.

“Oversight from one of the administrators who thought the breakout had stopped,” Schlesinger said. “But by now, I’ve spoken to many administrators. Most of them … all of them are very strict about the orders.”

So will this plan be more effective?

“I’m going to be focusing on this and putting out a bigger plan,” Mayor Bill de Blasio said. “But right now we’re going to have inspectors out. We have clear penalties, clear sanctions.”

Neighborhood officials said it is particularly important for members of this community to get vaccinated now because next week families will be gathering for the start of Passover.

NYC Health Department Puts Yeshiva Schools In Williamsburg On Notice: Allow Unvaccinated Students In At Own Peril

Big names populate lineup for Hospital Assn. annual meet

Well-known healthcare executives, public officials, and others are in D.C. this week for the AHA’s annual membership meeting.

The annual membership meeting of the American Hospital Association is well underway in Washington, D.C., where events began Sunday and will continue through Wednesday, with appearances by a number of noteworthy guests.

Public officials slated to make appearances Monday include Health and Human Services Deputy Secretary Eric D. Hargan; Sen. Roy Blunt, R-Missouri; and Adam Boehler, director of the Center for Medicare and Medicaid Innovation, according to the AHA’s schedule.

They will be followed Tuesday by former HHS secretary Rep. Donna Shalala, D-Florida; Rep. Richard Neal, D-Massachusetts; Rep. Michael Burgess, MD, R-Texas; and retired four-star General Colin Powell. Then attendees will hear from Speaker of the House Nancy Pelosi, D-California, and Senate Majority Leader Mitch McConnell, R-Kentucky, each of whom will share about their legislative priorities and the state of healthcare policymaking.

The annual meeting’s schedule also includes a number of prominent healthcare executives, of course, including Carilion Clinic President and CEO Nancy Howell Agee, who was AHA chair last year; Atlantic Health System President and CEO Brian Gragnolati, FACHE, who is current AHA board chair; and Saint Luke’s Health System President and CEO Melinda L. Estes, MD, who will be AHA board chair next year.

More information about the annual meeting is available on the AHA website.

https://www.healthleadersmedia.com/strategy/big-names-populate-lineup-american-hospital-associations-annual-meeting-week

Conference addresses changing telehealth landscape

The annual event, which launches Sunday in New Orleans, will focus on innovation and transformation.

As telehealth evolves to transform healthcare, the national telehealth organization ATA is launching its an annual ATA19 Conference on Sunday, April 14, in New Orleans and going through a bit of repositioning to better meet the changing landscape.

Now known as ATA, versus the American Telemedicine Association, the updated name and conference content reflect the broader scope of what the discipline encompasses today—synchronous and asynchronous communications, as well as provider-to-provider, and provider-to-patient, or provider-to-consumer connections.

“That’s the broad rubric of what we define as our domain at this point,” says ATA CEO Ann Mond Johnson. “It is different from where the organization started.”

Telehealth “gives us an opportunity to reimagine care,” says Mond Johnson, and the ATA19 program will give participants a glimpse into ways that can happen.

“In the spirit of transformation and innovation, we’ve taken a different approach to building the educational program for ATA19,” says Mond Johnson in a news release. “The educational program will focus on defining the world we’re going to live in and taking actionable steps to meet this world on our terms as we redefine the industry. We must deliberately embrace telehealth’s promise for those who can benefit from it most: vulnerable populations, the aging, communities impacted by catastrophic events, and veterans.”

In addition to many of the topics participants might expect, such as regulatory issues, success stories, and practical advice, topics addressed at ATA19 include:

• Ideas to foster innovation and engagement to advance the industry’s potential. The conference will offer opportunities to explore the spectrum of emergent technologies, trends, therapies, communication modalities, and science that will drive the next wave of telehealth solutions.
• The role of practitioners, including ways to provide support, resources to extend their capacity, and enhance professional training, as well as ideas about how to improve patient experience and engagement.
• How other industries are using technology to catalyze change.

Conference speakers include industry leaders, payers, patients, and practitioners. Among some the highlights:

• Elizabeth Teisberg, PhD, executive director of the Value Institute for Health & Care, University of Texas at Austin Dell Medical School
• Karen DeSalvo, MD, MPH, MSc, professor of medicine and population health at the University of Texas at Austin Dell Medical School
• Joe Kvedar, MD, vice president of Connected Health, Partners HealthCare
• Margaret Laws, president & CEO of HopeLab
• Peter Yellowlees, MD, chief wellness officer, UC Davis Health
• Toby Cosgrove, MD, former CEO and president of Cleveland Clinic, who currently serves as executive advisor to the organization

Representatives from a broad range of health systems will be presenting at the conference including Ascension, Avera eCARE, Beth Israel Deaconess Medical Center, Boston Children’s Hospital, Cleveland Clinic, Children’s Hospital of Philadelphia, Mayo Clinic, Medical University of South Carolina, NewYork-Presbyterian, Northwell Health, NYU Langone Health, Ochsner Health System, Partners HealthCare, Providence St. Joseph Health, University of Mississippi Medical Center, UPMC, Seattle Children’s, and many more.

“The ATA envisions a future where technology is used to extend the healthcare system in ways that break down traditional barriers to accessing care,” says Mond Johnson. “We see a future where technology addresses clinical variation amongst and between markets, better enables practitioners to do more good for more people, and meets the needs of people who stand to benefit most.”

https://www.healthleadersmedia.com/innovation/ata19-conference-and-organization-evolve-address-changing-telehealth-landscape

Novel 5-minute workout improves blood pressure, may boost brain function

Could working out five minutes a day, without lifting a single weight or jogging a single step, reduce your heart attack risk, help you think more clearly and boost your sports performance?

Preliminary results from a clinical trial of Inspiratory Muscle Strength Training (IMST), presented this week at the Experimental Biology conference in Orlando, suggest “yes.”

“IMST is basically strength-training for the muscles you breathe in with,” said Daniel Craighead, a postdoctoral researcher in the the University of Colorado Boulder Integrative Physiology department who is leading the study. “It’s something you can do quickly in your home or office, without having to change your clothes, and so far it looks like it is very beneficial to lower blood pressure and possibly boost cognitive and physical performance.”

Developed in the 1980s as a means to wean critically ill people off ventilators, IMST involves breathing in vigorously through a hand-held device — an inspiratory muscle trainer — which provides resistance. Imagine sucking hard through a straw which sucks back.

During early use in patients with lung diseases, patients performed a 30-minute, low-resistance regimen daily to boost their lung capacity.

But in 2016, University of Arizona researchers published results from a trial to see if just 30 inhalations per day with greater resistance might help sufferers of obstructive sleep apnea, who tend to have weak breathing muscles.

In addition to more restful sleep, subjects showed an unexpected side effect after six weeks: Their systolic blood pressure plummeted by 12 millimeters of mercury. That’s about twice as much of a decrease as aerobic exercise can yield and more than many medications deliver.

“That’s when we got interested,” said principal investigator Professor Doug Seals, director of CU Boulder’s Integrative Physiology of Aging Laboratory.

Systolic blood pressure, which signifies the pressure in your vessels when your heart beats, naturally creeps up as arteries stiffen with age, leading to damage of blood-starved tissues and higher risk of heart attack, cognitive decline and kidney damage.

While 30 minutes per day of aerobic exercise has clearly been shown to lower blood pressure, only about 5 percent of adults meet that minimum. Meanwhile, 65 percent of mid-life adults have high systolic blood pressure.

“Our goal is to develop time-efficient, evidence-based interventions that those busy mid-life adults will actually perform,” said Seals, who was recently awarded a $450,000 National Institute of Aging grant to fund the clinical trial of IMST involving about 50 subjects.

Craighead presented preliminary results Sunday and Monday at Experimental Biology 2019 showing that:

With about half the tests done, the researchers have found significant drops in blood pressure and improvements in large-artery function among those who performed IMST with no changes in those who used a sham breathing device that delivered low-resistance.

The IMST group is also performing better on certain cognitive and memory tests.

When asked to exercise to exhaustion, they were also able to stay on the treadmill longer and keep their heart rate and oxygen consumption lower during exercise.

Some cyclists and runners have already begun to use commercially-available inspiratory muscle trainers to gain a competitive edge.

But Seals and Craighead stress that their findings are preliminary and curious individuals should ask their doctor before considering IMST.

That said, with a high compliance rate (fewer than 10 percent of study participants drop out) and no real side-effects, they’re optimistic.

“High blood pressure is a major risk factor for cardiovascular disease, which is the number one cause of death in America,” said Craighead. “Having another option in the toolbox to help prevent it would be a real victory.”

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Story Source:

Materials provided by University of Colorado at Boulder. Note: Content may be edited for style and length.

https://www.sciencedaily.com/releases/2019/04/190408161643.htm

Zogenix price target lowered to $68 from $72 at Piper Jaffray

Piper Jaffray analyst Danielle Brill lowered her price target on Zogenix to $68 after it received a refusal to file letter from FDA on its Fintepla new drug application. The analyst notes that while the issues mentioned by the FDA sound like a simple fix, if the agency requires the company to conduct new toxicity studies, the re-submission could be delayed another 12-15 months. In spite of the “discouraging news”, longer term, Brill still keeps her Overweight rating on Zogenix and believes that “the company should be able to leverage existing ICH data with fenfluramine” based on their reported prior FDA interactions, modeling a launch in Q2 of 2020.
https://thefly.com/landingPageNews.php?id=2889977