CVS moving to change healthcare: A timeline since the Aetna acquisition

Since buying health insurer Aetna in November, CVS Health has emphasized holistic healthcare rather than just selling medicine. The company said it hopes its strategic shift will lead to healthier communities and lower healthcare costs.

Below is a timeline of health-related moves from CVS reported by Becker’s Hospital Review since it finalized its deal with Aetna. The timeline doesn’t include the CVS acquisitions of other retail pharmacies.

Nov. 28, 2018. CVS Health closes its $69 billion acquisition of Aetna. CVS Health President and CEO Larry Merlo says the deal “will simplify a complicated system and will help people achieve better health at a lower cost. We are also leading change in healthcare by challenging the status quo with new technologies, business models and partnerships.”

Jan. 9. Mr. Merlo says CVS will kick-start specialized services for Aetna members with cardiovascular disease and pilot a readmission prevention program. Under the program, CVS plans to schedule MinuteClinic follow-ups within 14 days of hospital discharge when patients are unable to see a physician.

Jan. 14. CVS announces it will spend $100 million over the next five years on community health initiatives. It pledges to give $20 million annually to initiatives in three categories: improving local access to affordable, quality care; impacting public health challenges; and partnering with local communities.

Jan. 30. Reports surface that CVS is piloting dental services. Under the program, CVS will help fit people for invisible braces via SmileDirectClub, a startup that offers direct-to-consumer teeth-straightening kits. Six of its drugstores will add a SmileShopExpress for customers to receive a 3D scan of their teeth to create invisible braces.

Feb. 13. CVS Health unveils three redesigned health-focused concept stores in the Houston market. The pilot stores, called HealthHubs, have space for services to help customers manage such chronic conditions as diabetes, hypertension and asthma. Each store also has an expanded health clinic with a lab for blood testing and health screenings. The stores have respiratory specialists and dietitians on staff.

Feb. 26. It is announced that CVS will spend $325 million and $350 million on technology to support offering more convenient healthcare.

March 20. CVS starts selling cannabis-based products in eight states

April 4. CVS expands its same-day prescription delivery service to 6,000 stores. The move comes as such retailers as CVS and Walgreens fight to compete with Amazon, which offers same-day delivery on toothpaste, bandages and other consumer health products.

May 1. CVS Health and Allentown, Pa.-based Lehigh Valley Health Network sign a five-year agreement that allows Lehigh Valley Health to share its EHR data with CVS to help connect the dots between patients, pharmacies, physicians and other health networks.

May 6. CVS Health’s subsidiary ProCare Pharmacy announces it will buy healthcare improvement company Premier’s specialty pharmacy.

June 4. After success with its pilot sites in Houston, CVS Health announces plans to open 1,500 HealthHub stores by the end of 2021.

June 11. CVS Health launches a platform that will allow its pharmacy benefit management clients to better manage contracts with third-party health and wellness vendors. The tool, Vendor Benefit Management, will offer CVS Caremark clients access to data on negotiated pricing, real-time eligibility verification and simpler billing and payment processing.

July 10. MinuteClinic, CVS Health’s retail medical clinic, launches telehealth programs in eight more states. Patients with minor illnesses, injuries or skin conditions now can seek care through virtual video visits in Arkansas, Connecticut, Hawaii, Indiana, Minnesota, Missouri, Oklahoma and Texas.

July 17. CVS Health starts clinical trials of a home kidney dialysis device, HemoCare — a move that could shake up the end-stage kidney care market and create a new healthcare business for the retail pharmacy giant. The move to provide at-home dialysis care sets up the retail pharmacy giant to compete with two of the largest operators of U.S. dialysis centers, Fresenius Medical Care and DaVita.

July 24. CVS Health launches a network to help connect Aetna’s most vulnerable patients to support services in their communities. CVS will collaborate with Unite Us, a social care coordination platform, to help Aetna’s Medicaid and dual-eligible Medicaid and Medicare members more easily access social services in their communities. Under the program, eligible members will be able to access Unite Us’ network of social care providers.

July 30. CVS Health selects Sree Chaguturu, MD, to serve as CMO of its pharmacy benefits management business, CVS Caremark. Dr. Chaguturu served as chief population health officer for Boston-based Partners HealthCare.

Aug. 5. CVS Health expands its pharmacy loyalty and membership program nationwide. The CarePass program offers delivery of products ranging from shampoo to prescription medications. To participate, program customers pay $5 a month, or $48 annually, for one- to two-day delivery of drugstore products and prescription drugs, 24/7 access to a pharmacist helpline and a 20 percent discount on CVS Health-branded products.
https://www.beckershospitalreview.com/pharmacy/cvs-moving-to-change-healthcare-a-timeline-since-the-aetna-acquisition.html

BenevolentAI and Novartis sign AI R&D deal

The Artificial Intelligence (AI)-based drug development firm BenevolentAI has signed an agreement with Novartis to find potential new uses for oncology drugs already in its pipeline.

UK-based BenevolentAI said the collaboration programme will be led by Novartis’ Precision Medicine Team, within the company’s Global Drug Development operation.

The so-called “framework collaboration” will see the two companies investigate indications and responder groups for oncology drugs currently in clinical development.

BenevolentAI will apply its technology designed to enable better data-driven decisions to find new ways to treat disease and personalise drugs for patients.

The UK firm’s technology scans through molecular, clinical, pharmacological data and scientific literature to derive relationships in the data between genes, diseases, drugs and biological pathways leading to the proposal of novel or optimal drug targets.

It aims to support scientists designing and optimising drug molecules for defined patient populations.

Founded in 2013, London-based BenevolentAI is already well-established in the field of drug R&D and is considered to be a biotech “unicorn” – a privately-held company worth more than $1 billion.

This year it raised a further $115 million from new and existing investors to increase its value to more than $2 billion,

BenevolentAI already has several high-profile research collaborations, including AstraZeneca, and licensed in a group of drugs to develop from Janssen in 2016.

It has acquired a new R&D facility in Cambridge, where AstraZeneca has also located its new R&D hub.

The collaboration with AZ is based around research for new treatments for chronic kidney disease and idiopathic pulmonary fibrosis.

Big pharma is increasingly turning to AI to make the drug discovery process faster and more efficient, such as using the technology to sort through the countless millions of molecules that could react with a drug target.

Celgene recently signed an oncology R&D deal with BenevolentAI’s UK rival, Exscientia, which is also working with GlaxoSmithKline.

Earlier this week Hong Kong’s Insilico Medicine claimed a major victory after its AI system outperformed big pharma in early drug R&D.

The company’s AI and deep learning system designed, synthesised, and validated a novel drug candidate in 46 days – 15 times faster than the best pharma companies.

BenevolentAI and Novartis sign AI R&D deal

J&J gets Stelara okay in Europe for ulcerative colitis

Johnson & Johnson’s inflammatory disease drug Stelara has been approved in Europe for ulcerative colitis (UC), a new use for the multibillion dollar blockbuster.

The European Commission cleared Stelara (ustekinumab) for adults with moderately-to-severely active UC, a fourth indication for the drug that is also being reviewed by the US FDA. Stelara can be used to treat patients who have failed to respond to or can’t tolerate other biologic therapies for UC.

J&J’s pharma unit Janssen said Stelara is the first interleukin-12/23 inhibitor to be approved for UC, an inflammatory bowel disease which affects around 2.6 million people in Europe. It is estimated that current therapies doesn’t work in up to two-thirds of cases.

The approval in UC is based on the phase 3 UNIFI study, which showed that Stelara was effective in achieving clinical remission in around 16% of people who couldn’t tolerate or failed prior therapy, including TNF inhibitors or Takeda’s α4β7 integrin blocker Entyvio (vedolizumab), compared to 5% of the placebo group.

Stelara was first approved for psoriasis 10 years ago, and follow-up indications in psoriatic arthritis and Crohn’s disease have kept the drug growing at a healthy pace to reach more than $5 billion last year.

It has proved remarkably resilient, growing another 23% to reach $2.96 billion in the first half of this year despite approvals for new biologics drugs in its main therapeutic categories – including some that have outperformed it in head-to-head trials.

The list of drugs that have outperformed J&J’s drug in psoriasis is getting fairly long. It includes IL-17 inhibitors such as Novartis’ Cosentyx (secukinumab) as well as new IL-23 inhibitors like AbbVie’s recently-approved Skyrizi (risankizumab), although it seems these are making headway more against older TNF blockers than Stelara.

J&J also has its own selective IL-23 inhibitor – called Tremfya (guselkumab) – rolling out for psoriasis, with other indications including UC in late-stage testing.

The company has stolen a march on its biologic rivals with the approval of Stelara in UC, which the company thinks could be a sizeable market for the drug in its own right.

It will have to jostle for market share with other drugs, including Pfizer’s oral JAK inhibitor Xeljanz (tofacitinib), which was approved for moderate-to-severe UC last year but has some safety concerns at higher doses, as well as newer drugs like Eli Lilly’s experimental IL-23 inhibitor mirikizumab.

Analysts at GlobalData are less confident however, saying shortly after the UNIFI data was presented that Stelara “is expected to have a slow adoption” in UC, adding that “competition in the moderate to severe disease category in UC is expected to intensify over the coming years, making it difficult for Stelara to attain a strong foothold in the…market.”

GlobalData says inflammatory bowel disease sales for Stelara will reach $1.5 billion by 2026 in its top seven pharma markets, but $1.3 billion of that total will come from Crohn’s disease.

J&J gets Stelara okay in Europe for ulcerative colitis

NextCure since its IPO

The initial public offering class of 2018 and 2019 has been very mixed. There have been some great winners, but there also have been some very well-known unicorns that have flopped. Sometimes it is the under-the-radar companies that offer the best upside stories, and sometimes unlucky timing or initial pricing can keep those great stories from ever being read about.

NextCure Inc. (NASDAQ: NXTC) appears to be one of those companies that has flown under the radar of the investing community since its initial public offering in 2019. The biotech outfit’s lead product candidate, NC318, is already in trials for the treatment of advanced or metastatic solid tumors. And its IPO timing in the first half of May was at a time when the “sell in May and go away” craze was in full swing.

Despite poor market sentiment in May, NextCure’s stock rose about 40% on its debut, with a $19.90 close (and $22.75 high) after pricing its 5 million shares at just $15 apiece. By the first week of June, the stock was back close to $15, and it wasn’t even moving until June 28 and July 1, when the volume spiked higher and the shares rose to $17.65 from $14.98.

Now, the shares are above $42. What is amazing, even on a day with a big analyst upgrade and with an 8% gain, is that NextCure has seen only four trading days in the past month in which the total volume was above 100,000 shares. That means this stock has tripled, and it hasn’t done it with any major investor interest.

This company was sitting on about $193 million in cash at the end of the second quarter, after its May 9 IPO raised about $86 million in gross proceeds. The company also has a collaboration agreement with Eli Lilly and Co. (NYSE: LLY). The company is among the many that want to use a patient’s own immune system to target cancers and other diseases. It is developing therapeutics after having identified several positive and negative immune regulators of myeloid cells and T cells to restore antitumor activity with its own FIND-IO technology.

NextCure’s latest news release indicated that it is on track to submit an investigational new drug application to the U.S. Food and Drug Administration (FDA) for its second product candidate (NC410) in the first quarter of 2020. The company noted recently that its NC410 is a novel immunomedicine that is seeking to block immune suppression mediated by an immune modulator called leukocyte‑associated immunoglobulin‑like receptor 1.

The driver on Thursday was that Piper Jaffray reiterated its Overweight rating and vaulted the target price to $54 from $26. Sure, the price target needed to be refreshed after it was surpassed and then some. Still, that’s a 100% boost to the target that was there earlier this summer.

According to the target hike at Piper Jaffray, the enthusiasm comes after continued enrollment in a dose-escalation study of NC318 in advanced solid tumors and the higher target is on increasing values ahead of a data release, which should come out during the fourth quarter.

Morgan Stanley had reiterated its Overweight rating in mid-August, but that target of $25 was raised to just $33.

One additional driver for investors may be the upcoming September 10 presentation at the Morgan Stanley 17th Annual Global Healthcare Conference in New York City.

NextCure was traded up almost 10% to $43.35 on Thursday, in a post-IPO range of $13.86 to $43.40. It’s just not common to see a stock rise this much, with a market cap that is nearing $1 billion and on such low trading volume.

The short interest has remained muted as it is a new stock, but as of mid-August the number of shares short had risen to over 236,000, when the shares were closer to $26.
Is NextCure the Next Big Cancer Biotech Every Investor Missed?

Pfenex Earns $11M Milestone under Agreement with Jazz Pharma

Pfenex Inc. (NYSE American: PFNX) today announced that it has earned an $11 million development milestone under its development and license agreement with Jazz Pharmaceuticals. The milestone is associated with process development activities for PF745, a recombinant crisantaspase with half-life extension technology.

“We are very pleased with our progress on PF745 and we believe the Jazz collaboration overall further validates the versatility of our proprietary protein expression platform and the quality of our development capabilities,” said Eef Schimmelpennink, Chief Executive Officer of Pfenex. “Similarly, we are appreciative of the progress recently reported by Jazz on PF743 (JZP-458) with the completion of the Phase 1 study and announcement of plans to initiate a Phase 2/3 study later in 2019.”

Under the terms of the development and license agreement, Pfenex is eligible to receive an aggregate total of up to $224.5 million in development and sales milestone fees, of which $177.5 million is still eligible to be received by Pfenex. Of this $177.5 million, $18.5 million are development milestones, $34 million are regulatory milestones, and $125 million are sales milestones. Pfenex may also be eligible to receive tiered royalties on worldwide sales of any products resulting from the collaboration.
https://www.globenewswire.com/news-release/2019/09/05/1911902/0/en/Pfenex-Earns-11-Million-Development-Milestone-under-its-Development-and-License-Agreement-with-Jazz-Pharmaceuticals.html

Aprea Therapeutics files for IPO

Clinical-stage biopharma Aprea Therapeutics has filed for an initial public offering.

The filing comes via J.P. Morgan, Morgan Stanley, and RBC Capital Markets, with a placeholder registration for $86.25M.

It's seeking a Nasdaq listing under the symbol OTCPK:APRE.

Operating expenses for the six months ended June 30 were $10.35M. The company expects IPO proceeds and cash on hand to complete each of its ongoing clinical trials.

https://seekingalpha.com/news/3497799-aprea-therapeutics-files-ipo

Telemarketer charged in $1.2B Medicare fraud scheme pleads guilty in NJ

The owner of a telemarketing company implicated in the largest component of a $1.2 billion Medicare fraud involving the supply of medically unnecessary orthotic braces pleaded guilty to criminal charges on Friday, the U.S. Department of Justice said.

Lester Stockett, the owner of Video Doctor USA and Telemed Health Group and chief executive of AffordADoc, also agreed to pay $200 million of restitution, as part of his plea to conspiracy to defraud the United States through kickbacks and conspiracy to commit money laundering, the department said.

Stockett, 52, of Medellin, Colombia, entered his plea before U.S. District Judge Madeline Cox Arleo in Newark, New Jersey. His sentencing is scheduled for Dec. 16.

Valentin Rodriguez, a lawyer for Stockett, in an email said his client “took full and early responsibility for his grave mistakes in this industry, and regrets what his actions caused.”

The Justice Department said Stockett was involved in a $424 million conspiracy where he obtained kickbacks and bribes from patient recruiters, pharmacies and brace suppliers, and then paid kickbacks and bribes to induce doctors to order braces for elderly and disabled patients who did not need them.

Stockett was among 24 defendants, including owners of medical equipment companies, charged in six states in April, in what prosecutors called one of the largest healthcare fraud schemes ever prosecuted in the United States.

The scheme allegedly involved the use of offshore call centers and shell companies, with laundered money used to buy exotic cars, yachts and luxury real estate.

“The extent of Mr. Stockett’s fraud and money laundering, literally, knew no bounds,” FBI Special Agent in Charge Gregory Ehrie said in a statement. “From the U.S. to Latin America, the Philippines, and the Dominican Republic, the FBI followed the trail of ill-gotten gains back to Stockett and his conspirators. They stole precious federal funds earmarked to assist the elderly.”

Criminal charges remain pending against Stockett’s co-defendants, Creaghan Harry and Elliot Loewenstern, over their alleged involvement in the Video Doctor scheme. Their lawyers did not immediately respond to requests for comment.

The U.S. Department of Health and Human Services has warned about scammers who offer braces through television and radio ads or by phone, and said Medicare might later deny needed braces to beneficiaries who accept unwanted or unneeded braces now.

https://www.reuters.com/article/us-usa-health-care-fraud/telemarketer-charged-in-1-2-billion-medicare-fraud-scheme-pleads-guilty-in-nj-idUSKCN1VR2IH