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Friday, April 19, 2019

A possible blood test for early-stage Alzheimer’s disease

A large team of researchers affiliated with a host of institutions across South Korea has developed a possible blood test to detect the early stages of Alzheimer’s disease in patients who have yet to exhibit symptoms. In their paper published in the journal Science Advances, the group describes their research and the technique they developed for detecting the disorder.
Alzheimer’s disease is, of course, a progressive disorder that involves neuronal deterioration in the brain, leading to a variety of symptoms, most notably memory loss. It is not curable and those afflicted eventually die.
Scientists have been studying Alzheimer’s disease for many years, and have learned that one of the things that happens in the brains of such patients is the buildup of an amyloid-beta (Aβ) peptide. While research into possible cures continues, a lot of effort is also being put into finding a test for the disorder before symptoms arise. Prior research has shown that Aβ is able to move from the brain into the bloodstream, suggesting that a  might be developed as a way to test for the disorder. Unfortunately, that idea has not panned out, as there is no way to determine if Aβ levels in the  actually show that Alzheimer’s disease has begun. In this new effort, the researchers believe they have found a way to alter Aβ found in  to reveal the presence of Aβ.
The researchers found that if a  known as EPPS was added to a solution holding Aβ concentrations, the molecule would force them apart. That led them to the idea of testing the broken samples from patients diagnosed with the disorder against control groups to see if there were differences.
The researchers report that their technique reliably distinguishes between diagnosed  and those in a control group. They also showed that the technique could be used as a way to monitor the progression of the disorder. They report that they are already making plans to make their technique available to doctors in clinical practice.
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More information: YoungSoo Kim et al. Comparative analyses of plasma amyloid-β levels in heterogeneous and monomerized states by interdigitated microelectrode sensor system, Science Advances (2019). DOI: 10.1126/sciadv.aav1388
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Amazon’s Haven sets up shop in New York to hire tech employees

Haven, the joint health venture between JPMorgan Chase, Berkshire Hathaway and Amazon, will open an office in New York City to recruit prospects, according to Business Insider.
This is Haven’s second location after announcing Boston as its headquarters. Haven’s New York office is searching for technology and engineer positions, according to a LinkedIn post from Serkan Kutan, the company’s chief technology officer.
“Excited to be building an outstanding tech team at Haven,” Mr. Kutan wrote. “We are growing in Downtown Boston and Union Square NYC. Come join us on this important journey!”
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Amazon Quits Chinese Business

Amazon.com Inc. is checking out of China’s fiercely competitive domestic e-commerce market.
The company told sellers on Thursday that it will no longer operate its third-party online marketplace or provide seller services on its Chinese website, Amazon.cn, beginning July 18. As a result, domestic companies will no longer be able to sell products to Chinese consumers on its e-commerce platform.
The decision marks an end to a long struggle by America’s e-commerce giants in the Chinese market. The firms entered the Chinese market with great fanfare in the early 2000s only to wither in the face of competition from China’s faster-moving internet titans.
Amazon has been in talks to merge its e-commerce business for goods imported into China with a Chinese competitor, NetEase Inc.’s Kaola, in a stock-for-stock transaction, according to a person familiar with the matter. That would remove the Amazon name from consumer-facing e-commerce in China. Neither company would confirm the progress or details of those talks, nor would they say if they are continuing.
In a written statement, Amazon said it remains committed to China through its global stores, Kindle businesses and web services.
Amazon China’s president will leave to take on another role within the company, the company said. The China consumer-business team will report directly into the company’s global team.
NetEase Chief Financial Officer Zhaoxuan Yang said in a call with analysts in February that the company is “open-minded to embrace stakeholders, strategic partners [and] business partners that can bring synergy and win-win to our e-commerce segment.”
When Amazon first entered China in 2004 with the purchase of Joyo.com, it was the largest online vendor for books, music and video there. Most Chinese consumers were using cash-on-delivery as their top form of payment. Today, Amazon China chiefly caters to customers looking for imported international goods such as cosmetics and milk powder and is a minuscule player in the booming Chinese e-commerce market.
Amazon China commanded just 6% of gross merchandise volume in the niche cross-border e-commerce market in the fourth quarter of 2018, versus NetEase Kaola’s 25% share and the 32% held by Alibaba Group Holding Ltd.’s Tmall International, according to Nomura Securities Co.
“Everyone has merged with someone,” said Chris Reitermann, chief executive for Asia and Greater China at Ogilvy, which advises Alibaba. “It became clear that as a Western internet company you wouldn’t be able to succeed at scale without a Chinese partner.”
For Nasdaq-listed NetEase, which has a market capitalization of $35 billion, the Amazon matchup is a way to expand beyond its lucrative videogame business. It is also a play to gain more trust from Chinese consumers who have complained about knockoff products on NetEase platforms, according to industry analysts.
In January, a customer accused Kaola of selling her a fake Canada Goose jacket and the incident went viral. Customers questioned whether the e-commerce firm could sufficiently maintain oversight of its platform, according to Azoya Group, which advises global retailers and brands that are setting up e-commerce businesses in China. Kaola pledged to investigate the matter.
Nomura believes that an Amazon tie-up, if it materializes, could help Kaola win the confidence of leading global brands. And that could lead to an increased supply of goods offered to Chinese consumers.
Those consumers are becoming more enamored with domestic brands. In 2011, 85% of Chinese consumers said they would always buy a foreign brand over a domestic one, according to Shanghai-based China Market Research Group. By 2016, 60% of respondents said they preferred domestic over foreign brands.
Shaun Rein, China Market Research’s founder, said American e-commerce giants stumbled in China because they haven’t offered the products or user experience that consumers are looking for.
“All the big e-commerce players in the United States have largely failed in China,” he said.
In 2003, eBay Inc. paid $150 million to buy EachNet, which was China’s top e-commerce site at the time. It later invested an additional $100 million. It struggled to keep up with Alibaba’s rival Taobao service, hobbled in part by a foreign management team that underestimated the competition and a payment system that was difficult for Chinese consumers to use. In 2006, eBay sold its China operations to internet company TOM Online.
Walmart Inc. also struggled to run an independent e-commerce business in China. It sold its e-commerce business to JD.com Inc. in 2016 rather than trying to crack the market on its own.
Groupon Inc. entered China in 2011 by setting by up a joint venture with Tencent Holdings Ltd. Before operations commenced, the company broadcast a commercial during the Super Bowl that included a reference to Tibet, which has been controlled by China for decades. Many Chinese people were offended and Groupon’s brand image was damaged. The company was unable to recruit local talent and to gain brand recognition despite a rapid expansion. Within 18 months, it merged with another Chinese daily-deal site also backed by Tencent.
Single-brand e-commerce companies such as Zara SA, Nike Inc. and Estée Lauder Cos. have been more successful than multibrand competitors in China, said Ivy Shen, vice president of international business at Azoya. Other smaller foreign firms have also made gains, she said, by offering products that are different from the ones carried by China’s major e-commerce companies.
“Everyone thought China is quite a huge cake,” she said. “But they didn’t realize there are so many aggressive domestic players fighting for the cake.”
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Danaher Q1 Revenues Up on Life Sciences

Danaher reported today a 4 percent year over year  increase in total revenues paced by a 10 percent jump in the Life Sciences business.
For the three months ending March 29, total revenues were $4.88 billion compared to $4.70 billion in the year-ago period. It beat the analysts’ average estimate of $4.79 billion.
Core revenue growth was 5.5 percent year over year. M&A added 2.5 percent to growth while currency effects decreased revenues by 4 percent, the firm said.
Revenue growth was driven by Danaher’s Life Sciences business, the largest of its four businesses, where revenues increased to $1.63 billion in Q1 2019 from $1.48 billion in Q1 2018, the company said in its 10-Q filed with the US Securities and Exchange Commission. Meanwhile, the Diagnostics business inched up 1 percent year over year to $1.54 billion from $1.52 billion.
In Life Sciences, Beckman Coulter Life Sciences core revenues were up in the double digits, Danaher President and CEO Thomas Joyce said on a conference call, with broad-based strength across most major regions and product lines.
Meanwhile, Sciex, which houses the mass spectrometry business, was up in the low single digits.
In Diagnostics, Beckman Coulter Diagnostics core revenues grew in the mid-single digits, led by immunoassays and automation, Joyce said, adding Danaher is seeing early positive impact in hematology from new product introductions. He noted, in particular, that Beckman Coulter recently received 510(k) clearance from the US Food and Drug Administration for its DxH 520 hematology analyzer, which is designed for low-volume laboratories.
Joyce further highlighted that new products for the low- and mid-volume laboratories will be forthcoming over the next year to two years, along with new menus.
Separately, Beckman Coulter also announced today that its Early Sepsis Indicator hematologic biomarker has been cleared by the FDA.
Cepheid, however, was down “slightly,” Joyce said, against a tough year-ago comparison driven by last year’s “severe flu season.” He noted that Cepheid’s installed based continues to grow and is “gaining momentum in North America.”
Excluding flu and certain high-growth businesses, Cepheid was up in the double digits year over year, Danaher CFO Matt McGrew said on the call.
Among Danaher’s remaining businesses, Dental was down 2 percent to $659.7 million from $672.6 million, while the Environmental & Applied Solutions business ticked up 3 percent to $1.06 billion from $1.03 billion.
In Q1, Danaher’s R&D spending grew 4 percent to $310.8 million from $298.7 million. Its SG&A costs grew 5 percent to $1.68 billion from $1.60 billion.
The company posted a profit of $327.3 million, or $.46 per share, in the recently completed quarter compared to a profit of $566.6 million, or $.80 per share, in Q1 2018.
On a non-GAAP basis, EPS for Q1 2019 was $1.07 and beat the consensus Wall Street estimate of $1.01.
The firm finished the quarter with $3.91 billion in cash and cash equivalents.
For Q2, Danaher projected EPS to be in the range of $.89 to $.92. Adjusted EPS is expected to be in the range of $1.13 to $1.16.
The company lowered its EPS guidance for full-year 2019 to a new range of $3.34 to $3.42 from a previous guidance of $3.85 to $3.95. Adjusted EPS is now expected to be in the range of $4.72 to $4.80 compared to a previous range of $4.75 to $4.85. Danaher said the new guidance reflects dilution expected from its recent equity offerings to fund the GE Biopharma acquisition, partially offset by its Q1 performance.
The $21.4 billion deal, announced in February, remains on track to be completed in Q4, Joyce said.
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If UnitedHealth Doesn’t Get Magellan, It Fits Anthem’s Services Strategy

News Anthem is in the hunt to acquire Magellan Health would seem to fit the health insurer’s desire to add specialty services.
Magellan is known for its behavioral health services though it also has a pharmacy benefit management (PBM) business and Medicaid health plans.Anthem is an operator of Blue Cross and Blue Shield health plans in 14 states and is rolling out its own new PBM, IngenioRx, that could benefit from additional scale of enrollees from an acquisition.
Reports late this week say Anthem, the nation’s second-largest health insurer, and UnitedHealth Group, the nation’s largest health insurer, are in a late round of bidders for Magellan, which could also be sold to private equity interests, these reports say. Analysts are also speculating Anthem and UnitedHealth are in the lead to get Magellan.
“We see Anthem and UnitedHealth Group as the most likely buyers in light of their synergies with Medicaid in Complete Care, and the PBM across IngenioRx and OptumRx.,” SVBLeerink analyst Ana Gupte wrote in a research note Thursday. “OptumRx is seeking specialty Rx and we expect UnitedHealth is looking for regional players to shore up Medicaid. Anthem is poised as well to build their third-party services platform.”
Neither UnitedHealth nor Anthem would comment on the reports or their interest in Magellan.
But Anthem executives told analysts at its annual investor day a month ago they were looking to “expand specialty and differentiated services.”
“We are doing this by providing market-leading solutions and care delivery models that personalize care for those with complex and chronic conditions,” Anthem CEO Gail Boudreaux said at the company’s annual investor day last month. “We possess a solid foundation with AIM, Aspire, CareMore and HealthCore. We’ll continue to drive growth by being the go-to partner for non-Anthem Blue plans, care providers and other health care systems.”
Magellan has an array of customers including health plans, employers and government agencies and its PBM has a specialty pharmacy managementbusiness, according to the company’s web site.
Anthem began transitioning its health plan members away from Express Scripts to IngenioRx last month.
IngenioRx is smaller than bigger PBMs like UnitedHealth’s OptumRx, CVS Health’s Caremark PBM and Cigna’s Express Scripts PBM and could benefit by additional enrollees during a period of consolidation and scrutiny on drug pricing. The Trump administration and Congress are working to increase regulation of the PBM’s role as a middleman between drug makers and consumers and its share of rebates — the portion of the drug returned by the seller to the buyer. Some believe there will be more PBM consolidation as bigger players are forced to grow by acquisition given new government rules could limit other revenue growth.
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Lonza reports pharma strength as rest of business falters

  • Swiss manufacturer Lonza said its newly restructured pharma, biotech and nutrition business beat expectations in the first quarter, helped by strong demand in its biologics business.
  • Performance in Lonza’s specialty ingredients business, on the other hand, disappointed amid raw material shortages and supply-chain disruptions caused by China’s Blue Sky environmental program and a major Chinese plant explosion, the company said.
  • Still, the Swiss drug manufacturer maintained its overall sales forecast for 2019, saying the strength of its drugs offerings made up for headwinds facing the rest of its business.

Lonza is focusing on the thriving part of its business, making a flurry of investments in manufacturing for biologics while divesting more traditional divisions such as water care.
It’s part of the company’s years-long transition from an industrial chemical stalwart founded in 1897 to a modern contract manufacturer for cutting-edge medical treatments.
Lonza CEO Marc Funk told BioPharma Dive in a recent interview that the need for drug contract and manufacturing companies has never been greater. Advances in science and the faster regulatory pathways for new treatments are driving new demand, he said.
Just this month, for example, Lonza announced a partnership with the Danish bioscience company Chr. Hansen to develop and produce bacteria-based therapies — part of the emerging microbiome field. Lonza’s expansion is global, too, with investments in healthcare projects across the U.S., Europe, China and Singapore.
Build-out of the company’s Ibex biologics platform in Visp, Switzerland remains ongoing. Lonza said the clinical manufacturing offering has a full slate of customers for 2020, more than year before operations begin, the company said.
The company didn’t give earnings or sales figures for the first quarter but did offer some guidance. Lonza said it’s maintaining its 2019 outlook for mid- to high-single digit sales growth and sustained margin levels.
For 2022, the out year for current guidance, the company expects sales to reach 7.1 billion Swiss francs, or about $7 billion.
The company plans to report first-half results on July 24.
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Bausch Health R&D-light in eye care, so don’t compare it to Alcon

After Novartis eye care spinoff Alcon made a successful debut on the Swiss Exchange earlier this month, some analysts used it as argument to make a bullish case for Bausch Health. But one analyst disagrees.
Wells Fargo’s David Maris, in a Wednesday note to clients, maintained his “underperform” rating for Bausch Health. His reason? An irreplaceable leader such as LeBron James in basketball or Alcon in eye care makes “significantly more” than others.
“Alcon has a long history of being a market leader and in some markets [Bausch] is a distant, and what we consider, an insignificant #4 player in ophthalmology, has growth supported by price increases, and is launching products that do not threaten the market leaders,” he said.
Maris noted that the NBA superstar’s pay in the 2018-19 season is set to be nearly five times that of the fourth-highest paid player on his team. Therefore, he argued that applying Alcon’s EBITDA multiple to Bausch fails to consider the “mass and structural advantages” that a market leader has.
Such comparison seems problematic to Maris, as Bausch’s surgical business is much smaller than Alcon’s. To the Wells Fargo analyst’s estimation, Bausch’s largest ophthalmology product might be a vitamin.
But perhaps more importantly for Maris’ bearish estimate is the Canadian drugmaker’s meager commitment to R&D, especially in its Bausch & Lomb franchise, whose portfolio is more suitable for comparison purposes with Alcon’s.
On very loose terms for illustrative purposes only, Maris calculated a Bausch & Lomb standalone—without the segment’s non-ophthalmology business—EBITDA of $1.14 billion in the year 2018, versus $906 million for 2012, which the company had disclosed in a go-public attempt.
At first glance, the number doesn’t look bad. But Maris noticed that the company was spending a lot less in R&D last year. The entire new Bausch & Lomb International business—with about $1 billion in 2018 non-eye-care sales—spent only $96 million in R&D in 2018, or 2% of its sales, versus $227 million in 2012.
Spending less obviously boosts EBITDA. If it had been paying for R&D like it was in 2012, the Bausch & Lomb’s EBITDA would be merely $982 million, Maris said.
In comparison, Alcon, in its filing with the U.S. Securities and Exchange Commission, said it invested $587 million in R&D in 2018, representing 8.2% of its total revenues that year.
“To us this is critical to a valuation, and in our opinion, it is tough to be a leader if you spend so little in R&D,” Maris said.

All told, Bausch Health’s R&D expenses for 2018 were $413 million, with a large part going to the drug business—which hasn’t exactly paid off. For example, its plaque psoriasis lotion Duobrii, which Bausch has dubbed among the “Significant Seven” drugs it’s counting on for growth, got an FDA Complete Response Letter last year. And the FDA has postponed its decision date on Bausch’s resubmission, the company disclosed in February.
Recently, the FDA approved competitor Cosmo Pharmaceuticals’ Aemcolo in travelers’ diarrhea, but that indication constitutes only 2% of prescriptions for Bausch’s top seller Xifaxan.
Still, “we think investors should ignore any straw man arguments that the lack of impact from Aemcolo on Xifaxan is good news for BHC as we are unaware of any significant investor worry about this threat,” Maris said. And he cautioned that a potential positive phase 2 in irritable bowel syndrome with diarrhea could help Aemcolo eat away Xifaxan shares more significantly.
To sum it up? Maris said Bausch should trade at “a significant discount to peers […] based on low growth, underinvestment in R&D, and dependence on price increases and product concentration risk with Xifaxan.”
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