bluebird bio (NASDAQ:BLUE): Q3 GAAP EPS of -$3.73 misses by $0.19.
Revenue of $8.91M (-22.7% Y/Y) misses by $3.56M.
Thursday, October 31, 2019
Amgen to Collaborate With BeiGene To Expand Oncology Presence In China
Amgen to Acquire 20.5% Stake in BeiGene for Approximately $2.7 Billion in Cash
BeiGene to Commercialize XGEVA® (denosumab), KYPROLIS® (carfilzomib) and BLINCYTO® (blinatumomab) in China
Companies to Collaborate on Advancing Amgen’s Innovative Oncology Pipeline in China
Amgen Will Continue to Commercialize its Non-Oncology Product Portfolio in China
Amgen to Host Call for Investors Today at 2 p.m. PT
BeiGene to Commercialize XGEVA® (denosumab), KYPROLIS® (carfilzomib) and BLINCYTO® (blinatumomab) in China
Companies to Collaborate on Advancing Amgen’s Innovative Oncology Pipeline in China
Amgen Will Continue to Commercialize its Non-Oncology Product Portfolio in China
Amgen to Host Call for Investors Today at 2 p.m. PT
Amgen (NASDAQ:AMGN) announced today that it has entered into a strategic collaboration with BeiGene that will significantly accelerate Amgen’s plans to expand its oncology presence in China, the world’s second-largest pharmaceutical market. BeiGene is a research-based, oncology-focused biotechnology company with an established and highly experienced team in China, including a 700-person commercial organization and a 600-person clinical development organization.
‘This strategic collaboration with BeiGene will enable Amgen to serve significantly more patients by expanding our presence in the world’s most populous country,’ said Robert A. Bradway, Amgen’s chairman and chief executive officer. ‘Cancer is a leading cause of death in China and will only become a more pressing public health issue as the Chinese population ages. With its extensive commercial and clinical capabilities within China and a commitment to global quality standards, BeiGene is the ideal strategic collaborator as we seek to make a meaningful difference in the lives of millions of cancer patients in China and around the world.’
As part of the collaboration:
- Amgen will acquire a 20.5% stake in BeiGene for approximately $2.7 billion in cash. This represents a purchase price of $174.85 per BeiGene American Depositary Share on NASDAQ, a 36% premium to BeiGene’s 30-day volume-weighted average share price as of Oct. 30, 2019. Amgen will nominate one person to serve on BeiGene’s Board of Directors.
- Under the agreement, BeiGene will commercialize XGEVA® (denosumab), KYPROLIS® (carfilzomib) and BLINCYTO® (blinatumomab) in China during which time the parties will equally share profits and losses. Two of these products will revert to Amgen, one after five years and one after seven years. Following the commercialization period, BeiGene will have the right to retain one product and will be entitled to receive royalties on sales in China for an additional five years on the products not retained. XGEVA was launched in China in September of this year; KYPROLIS and BLINCYTO are both in Phase 3 trials in China.
- Amgen and BeiGene will collaborate to advance 20 medicines from Amgen’s innovative oncology pipeline in China and globally. BeiGene will share global research and development costs and contribute up to $1.25 billion to advance these medicines. Amgen will pay royalties to BeiGene on the sales of these products outside of China, with the exception of AMG 510, Amgen’s first-in-class KRASG12C inhibitor that is being studied as a potential treatment for solid tumors. Amgen anticipates utilizing data from clinical trials conducted in China to advance the development of its oncology portfolio globally.
- Of the 20 oncology medicines in development, BeiGene will assume commercial rights in China for seven years after launch for those that receive approval in China, including AMG 510. After this time, BeiGene will retain rights to up to six of these products in China, excluding AMG 510, while rights on remaining products revert to Amgen. Amgen and BeiGene will share profits in China equally on these products until the rights revert to Amgen, after which Amgen will pay royalties to BeiGene on sales in China for a period of five years after reversion.
- Amgen will continue to commercialize its non-oncology product portfolio in China. Earlier this year, Amgen launched its first-ever product in China, Repatha® (evolocumab), an LDL cholesterol-lowering treatment proven to reduce the risk of heart attacks and stroke. Amgen expects to launch a number of other non-oncology medicines in China over the next several years, including Prolia® (denosumab), which reduces the risk of fracture in postmenopausal women with osteoporosis.
- XGEVA, KYPROLIS and BLINCYTO, as well as the medicines in Amgen’s oncology pipeline, will be manufactured at Amgen’s existing facilities.
Since 2011, Amgen has expanded its geographic presence from approximately 50 to 100 countries, enabling the company to play a growing role in serving the rapidly increasing demand for better healthcare around the world. The pharmaceutical market in China is expected to grow briskly as access to new medicines continues to improve. With approximately four million people diagnosed with cancer annually and 2.3 million deaths from the disease each year, the need for new oncology treatments in China is particularly acute and the oncology market is one of the fastest-growing segments of the overall pharmaceutical market there.
Amgen will purchase its equity stake in BeiGene with available cash and expects to retain its investment grade credit rating.
‘Amgen’s capital allocation priorities remain unchanged,’ said David W. Meline, executive vice president and chief financial officer at Amgen. ‘We will continue to grow our business through internal investment and business development, while providing attractive returns to our shareholders through a growing dividend and continued share repurchases.’
The transaction is expected to close in early 2020 subject to BeiGene shareholder approval, the expiration or termination of waiting periods under all applicable antitrust laws, and satisfaction of other customary closing conditions.
Goldman Sachs & Co. LLC is acting as exclusive financial advisor, and Latham & Watkins LLP is serving as legal advisor to Amgen.
Webcast Details
Amgen will host a webcast call today at 2 p.m. PT. where members of Amgen’s executive management team will discuss the Company’s strategic collaboration with BeiGene.
Amgen will host a webcast call today at 2 p.m. PT. where members of Amgen’s executive management team will discuss the Company’s strategic collaboration with BeiGene.
Live audio webcast of the investor call will be broadcast over the internet simultaneously and will be available to members of the news media, investors and the general public.
The webcast, as with other selected presentations regarding developments in Amgen’s business given at certain investor and medical conferences, can be accessed on Amgen’s website, www.amgen.com, under Investors. Information regarding presentation times, webcast availability and webcast links are noted on Amgen’s Investor Relations Events Calendar. The webcast will be archived and available for replay for at least 90 days after the event.
EyeGate Pharma up 22% ahead of key data readout
Thinly traded nano cap EyeGate Pharmaceuticals (EYEG +22.4%) is up on almost a 4x surge in volume, albeit on turnover of only 82K shares, on no particular news.
A key looming event is the release of data from a pivotal study evaluating its Ocular Bandage Gel eye drop in patients undergoing photorefractive keratectomy (laser surgery on the eye for vision correction). Randomization was completed a month ago with topline results expected by year-end. If all goes well, it expects to file a U.S. marketing application in H1 2020.
On the working capital front, at the end of June, it had $4.7M in cash and equivalents while operations consumed $3.6M in H1.
On October 18, it filed an S-3 for the resale of 1.2M common shares from current stockholders.
Adamis Pharma up 15% ahead of FDA decision on higher dose naloxone
Adamis Pharmaceuticals (ADMP +14.7%) is up on a 6x surge in volume as investors expect the FDA nod for higher dose naloxone for the treatment of opioid overdose. The agency’s action date is today.
Altria Cuts Value of Juul Stake by $4.5B
Altria Group Inc. wrote down its investment in Juul Labs Inc. by more than a third and now holds it at a price that values the e-cigarette maker at about $24 billion.
The Marlboro maker cited unexpected shifts in the market, including proposed U.S. bans on e-cigarette flavors and regulatory crackdowns abroad, for its decision to cut the value of its investment by $4.5 billion.
“Of course, we’re not pleased to have to take an impairment charge on the Juul investment,” the company’s chief executive, Howard Willard, said on a conference call Thursday. “We did not anticipate this dramatic a change in the e-vapor category,” he said.
Facing an accelerating decline in cigarette sales, the tobacco giant last year agreed to pay $12.8 billion for a 35% stake in Juul, making it one of Silicon Valley’s most valuable startups. Now, blamed for a rise in teenage vaping, Juul is bracing for a planned federal ban on e-cigarette flavors that represent more than 80% of its U.S. sales.
The embattled company plans to cut between 400 and 600 jobs by the end of the year as part of a reorganization aimed at mending damaged relationships with regulators, The Wall Street Journal reported on Monday.
Altria on Thursday also lowered its profit growth forecast for the next three years to a range of 5% to 8%, down from its previous forecast of 7% to 9%.
Altria executives said they now expect lower e-cigarette industry sales volumes and a longer time before Juul reaches a profit margin comparable to combustible cigarettes.
The number of adult e-cigarette users in the U.S. rose to 12.6 million in September, including six million who vaped exclusively, Mr. Willard said.
The Marlboro maker aims to offer a menu of cigarette alternatives, Mr. Willard said, including a tobacco-free nicotine pouch in which Altria recently invested and a heated tobacco device that Altria launched in the U.S. in September through a partnership with Philip Morris International Inc. That device, called IQOS, is currently available in Atlanta and will go on sale in Richmond, Va., next month, Altria said.
The company said it supports Juul’s planned staff cuts and its new leadership. Juul’s CEO, K.C. Crosthwaite, left Altria in September to run the startup.
Hedge fund Darsana Capital Partners recently wrote down its investment in Juul by more than a third, valuing the company at $24 billion. And Fidelity Investments this week disclosed that it had slashed the value of its Juul investment by nearly half to a price that valued the startup at around $20 billion.
“One stock decision in particular hurt by far more than any other: electronic cigarette maker Juul Labs,” Fidelity’s Blue Chip Growth Fund said in its quarterly fund commentary. “Juul’s valuation…fell this period as the company faced myriad regulatory challenges.”
The fund cited the Food and Drug Administration’s plan to remove from the market all e-cigarettes except those formulated to taste like tobacco, as well as a formal rebuke the agency sent Juul in September for making unauthorized claims that its products were safer than traditional cigarettes.
The Wall Street Journal calculated the valuation of about $20 billion assuming the fund hadn’t bought or sold any Juul shares since the end of July. Bloomberg earlier reported Fidelity’s write-down.
Juul is the subject of several investigations, including a criminal probe by federal prosecutors in California. By May, the company must submit for FDA review any products it wants to remain on the U.S. market beyond that point.
Juul’s sales have fallen since the Centers for Disease Control and Prevention in September warned the public to stop using e-cigarettes as it investigated a mysterious vaping-related lung illness. The agency has since narrowed that warning, advising people not to vape THC, the psychoactive ingredient in cannabis. Juul’s products haven’t been linked to the illness.
Shares of Altria rose 1.2% in morning trading Thursday.
Vyndaqel romps away in US, spurring earnings hike from Pfizer
Pfizer’s new drug for a rare heart disease – Vyndaqel – has shattered analysts’ sales forecasts in its first quarter on the market and looks set to quickly enter blockbuster territory.
Five months since becoming the first drug to be approved by the FDA for wild-type or hereditary transthyretin amyloid cardiomyopathy (ATTR-CM), Vyndaqel (tafamidis) has made $156 million in the third quarter, $77 million from the US.
Vyndaqel has previously been approved in European markets and Japan but not the US for hereditary transthyretin amyloid polyneuropathy (ATTR-PN), and while sales in that indication have been modest to date other approvals in ATTR-CM contributed to the drug’s growth.
The sales surge has come from the current four capsules-per-day formulation of the drug, with a one-pill-a-day version – called Vyndamax – launched in September that could further stimulate sales growth.
Previously, analysts said they were expecting Vyndaqel to top $1 billion in sales in 2024, but it seems that Pfizer’s drug is going to beat that timeframe on the back of rising rates of diagnosis helped by a shift from a biopsy approach to a non-invasive imaging technique called scintigraphy.
Vyndaqel’s gathering momentum – coupled with a 25% increase in sales of Pfizer’s blood cancer therapy Ibrance (ibrutinib) to $1.28 billion – helped Pfizer post better-than-expected third-quarter revenues of $12.7 billion.
Sales were down 5% overall in the quarter as Pfizer weathered the loss of patent protection and the start of generic competition for big-selling pain drug Lyrica (pregabalin), which dragged sales of its Upjohn division – due to be spun off and combined with Mylan – down 26%.
Nevertheless, Pfizer chief executive Albert Bourla said revenues for the full-year will now rise by mid-to-high single digits from an earlier prediction of low-to-mid single digits, with its forecast up by $700 million to $51.2-$52.2 billion.
The raised forecast is down to the performance of Vyndaqel and Ibrance but also other drugs including arthritis drug Xeljanz (tofacitinib), anticoagulant Eliquis (apixaban) and Inlyta (axitinib), which have benefited from approvals in combination with cancer immunotherapies for renal cell carcinoma.
That includes a dual regimen with Pfizer’s PD-1 inhibitor Bavencio (avelumab) approved by the European Commission this week for newly-diagnosed RCC, which came after an FDA approval for the combination earlier this year. Sales of Inlyta almost doubled to $139 million in the third quarter.
On a conference call, Bourla said the reshaped Pfizer that will follow the spin-off of Upjohn and the creation of a consumer health joint venture with GlaxoSmithKline will result in a leaner company that will be able to return annual growth of 6% over the next five years.
The company will not need to consider a big M&D deal, he added, and the business development strategy “will continue to be bolt-on, but we’ll have a focus on R&D” in particular phase 2 assets.
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