Biopharma venture investors shrug off Covid-19

First-quarter venture investments barely register the pandemic – huge cash reserves should protect funding for biotech start-ups this year.
Clinical trials are being mothballed across the biopharma industry, and companies are delaying the launch of new products because of Covid-19. But if the $1.46bn that Arch Venture Partners has just raised for two new funds is anything to go by there is still substantial appetite for private financings, even at the very high-risk end of biotech.
The fact that Arch was able to amass such a huge war chest reflects a belief that biopharma will eventually return to some semblance of normality; patients will still require new and innovative drugs. Vantage‘s latest analysis of EvaluatePharma data also reflects venture’s seeming resilience to coronavirus, with the amount invested over the opening months of the year and the volume of deals showing very little retreat over previous quarters.
It should be noted that this analysis includes only companies developing human therapeutics, providing a look at the highest-risk end of biotech venture investing. Subsectors like Medtech and diagnostics are excluded, as is digital health, an industry that has seen a huge inflow of investment thanks to the Covid-19 pandemic.
If the current pace of investment is maintained for the rest of 2020 total funding could come in at around $13.2bn. While this is back down to 2017 levels, it is widely agreed that 2018 was an outlier, and the sums being raised are still very high, historically.
The volume of deals has stayed pretty constant for the past seven quarters, suggesting that a “new normal” is emerging. It also looks like mega-rounds remain very much a feature, as huge syndicates are formed to fund companies as far along development paths as possible.
This has concentrated venture cash into ever fewer hands, and one fallout of the pandemic could be to exacerbate this trend, with VCs perhaps leaning towards safer plays in the coming months.

Annual biopharma venture investments
	Investment ($bn)	Financing count	Avg per financing ($m)	No. of rounds ≥$50m	No. of rounds ≥$100m
Q1 2020	3.28	101	33.47	25	11
2019	14.67	417	36.41	116	36
2018	17.89	481	39.06	130	38
2017	13.21	528	27.40	76	19
2016	10.44	493	22.51	52	15

Of course at this point in the year everything is speculative, given that we have yet to see the full fallout from the pandemic. This will continue to affect supply chains for much of biopharma, interrupt the hiring plans of start-ups and almost certainly delay any non-Covid-19 related dealmaking.
Shielding the venture sector in the medium term is the fact that the good times of 2018 and 2019 allowed huge funds to be raised that will have to be deployed within defined timeframes. And, as the Arch fundraising demonstrates, limited partners, who supply the capital for funds, are still keen to allocate cash to this asset class.
But much depends on how long the disruption continues, something that is true for pretty much all sectors.

Biggest biotech venture rounds of Q1 2020
Company	Amount raised ($m)	Location	Financing round
Immunocore	130.0	United Kingdom	Series B
Nurix	120.0	USA	Series D
Kallyope	112.0	USA	Series C
SutroVax	110.0	USA	Series D
Generation Bio	110.0	USA	Series C
Source: EvaluatePharma.

In an usual turn-up for the books the biggest financing of the quarter was led by a UK company, Immunocore. The troubled biotech has long been looking for money, and managed to secure $130m in a series B round, although the fact that this was a down round took some shine off.
While there were the usual suspects of oncology and gene therapy companies among the five largest rounds, Kallyope with its focus on small-molecule drugs targeting the gut showed that companies in lower-profile therapy areas can rake in substantial amounts of cash.
The timing of Sutrovax’s series D round at the end of March might have been coincidental, given the time it can take to put syndicates together. But alongside the group’s primary focus on pneumococcal infections, its cell-free protein synthesis vaccine platform, which promises to circumvent some of the efficacy and scaling issues of traditional vaccines, might have provided an additional attraction in coronavirus times.
The first quarter did not raise any obvious alarm bells for the financing of smaller companies. But it will be interesting to watch how venture chooses to allocate its money in the coming months.
https://www.evaluate.com/vantage/articles/data-insights/venture-financing/biopharma-venture-investors-shrug-covid-19

What to look for in upcoming Covid-19 trial readouts

Industry-sponsored clinical studies against the new coronavirus have proliferated, as have their designs and efficacy measures.

As attention in the battle to treat Covid-19 turns to the imminent readout of remdesivir studies in China investors will be trying to handicap the chances of Gilead’s own global trials, reading out a little later.
It is also worthwhile remembering other clinical studies that have recently got under way to treat and, in some cases, prevent the new coronavirus. An analysis of data on EvaluatePharma’s dedicated Covid-19 landing page reveals no fewer than 230 trials seeking to enrol nearly 200,000 subjects, but what should be especially interesting is the commercial studies and their endpoints.
This group comprises 20 trials of 17 projects, including of course Gilead’s two remdesivir studies, which could read out in May. A key consideration is whether studies have a blinded control, and in the case of remdesivir this is one of the main points differentiating Gilead from the Chinese trials.
The latter two tests, in 308 mild/moderate and 453 severe Covid-19 subjects, are quadruple-blinded and measure time to clinical recovery versus placebo. Gilead’s, meanwhile, are open-label: the moderate disease trial is versus standard of care while the severe is uncontrolled, and both measure disease improvement over 14 days.
Both sets of trials use a 200mg loading dose followed by 100mg for nine days, though Gilead’s also test five-day cohorts. On the one hand the China trials’ open-ended efficacy endpoint seems less strict than Gilead assuming an effect within 14 days, though of course the former’s blinded design is more stringent.
Another issue confounding comparisons is that the China groups recruited subjects within eight or 12 days of symptom onset, while Gilead specified up to four days from PCR confirmation of Covid-19. Evercore ISI says the former did not source remdesivir from Gilead, and Gilead has stated that it has no visibility on their data.

Commercial projects in clinical trials for Covid-19*
Project	Company	Study	Enrolment	Location	Design	Key efficacy measures
Remdesivir	Gilead	NCT04292730	600	Global	Open-label	14-day hospital discharge vs SOC
Remdesivir	Gilead	NCT04292899	400	Global	Uncontrolled	14-day fever normalisation
Plaquenil	Sanofi	Hydra	500	US & Mexico	Quadruple-blinded	All-cause mortality vs placebo
Plaquenil (prophylaxis)	Sanofi	Phydra	400	US & Mexico	Quadruple-blinded	60-day Covid-19 infection vs placebo
Actemra	Roche	Covacta	330	?	Double-blinded	28-day clinical status vs placebo
Fludase	Ansun Biopharma	NCT03808922	250	Global	Quadruple-blinded	28-return to room air vs placebo
CD24Fc	Oncoimmune	SAC-COVID	230	US	Quadruple-blinded	14-day Covid-19 status vs placebo
ASC09 + Norvir	Ascletis	NCT04261907	160	China	Open-label	Time to recovery vs Kaletra
T89	Tasly	NCT04285190	120	China	Open-label	Time to normal oxygen saturation vs placebo
Kevzara	Sanofi/ Regeneron	NCT04315298	400	US	Quadruple-blinded	% chg in CRP/time to improvement vs placebo
Kevzara	Sanofi/ Regeneron	NCT04327388	300	Europe	Quadruple-blinded	Fever resolution/15-day severity vs placebo
Kaletra	Abbvie	Solidarity	440	Canada	Open-label	29-day Covid-19 infection vs SOC
PUL-042 (prophylaxis)	Pulmotect	NCT04313023	200	?	Quadruple-blinded	14-day Covid-19 prevention vs placebo
PUL-042	Pulmotect	NCT04312997	100	US	Quadruple-blinded	14-day Covid-19 severity vs placebo
IFX-1	Inflarx	Panamo	130	Europe	Open-label	5-day chg in PaO2/FiO2 vs SOC
Gamifant or Anakinra	Swedish Orphan Biovitrum	NCT04324021	54	Europe	Open-label	15-day % off ventilation vs SOC
Piclidenoson	Can-Fite	NCT04333472	40	Israel	Open-label	Time to clinical recovery vs SOC
INOmax	Mallinckrodt	NONTM	20	Canada	Uncontrolled	FEV1 from baseline/QOL
mRNA-1273 (vaccine)	Moderna	NCT04283461	45	US	Uncontrolled	% seroconversion
Ad5-nCoV (vaccine)	Cansino Biologics	APICTH	108	China	Uncontrolled	Immunogenicity
*All projects therapeutic except where stated; excludes expanded-access programmes. Source: EvaluatePharma.

Among other projects, investors will also be keenly tracking the malaria/lupus drug Plaquenil, championed by President Donald Trump. Since the few scraps of data supporting this have largely been anecdotal, it is reassuring that Sanofi’s studies, ending late this year, are quadruple-blinded, and one measures the tough endpoint of all-cause mortality versus placebo.
Only two commercial vaccines are in trials at present, from Moderna and Cansino (The long path to an effective coronavirus vaccine, April 3, 2020). However, these will soon be joined by vaccines from Johnson & Johnson and the UK’s University of Oxford, the latter through a consortium that Oxford Biomedica joined today.
Ultimately, investors will want share prices to reflect progress; Gilead’s valuation has put on nearly $12bn year to date, while J&J’s gained $26bn when it revealed its lead Covid-19 vaccine candidate. This is despite J&J spelling out the not-for-profit basis of its work; Gilead too is unlikely to be able to charge much for remdesivir, while Plaquenil is off patent.
That said, the kudos for a company that brings an effective treatment to market, in terms of publicity and government recognition, will have its own value.

Covid-19 study totals
Stage	Enrolment	Trial count
Early phase 1	1,868	4
Phase 1	2,424	10
Phase 1/2	1,069	9
Phase 2	7,413	38
Phase 2/3	9,374	21
Phase 3	44,905	39
Phase 4	12,164	16
N/A	117,013	93
Total	196,230	230
Source: EvaluatePharma; excludes observational and epidemiology studies, and patient registries.

https://www.evaluate.com/vantage/articles/analysis/what-look-upcoming-covid-19-trial-readouts

Most NYC Covid-19 Cases Came From Europe, Genome Researchers Say

The explosion of Covid-19 cases in the New York City area resulted largely from infected patients who flew in from Europe, genome scientists say.
Researchers at NYU Langone Health said they’ve analyzed 75 samples from patients who were diagnosed with Covid-19, the disease caused by the novel coronavirus, at New York-area hospitals last month.
About two-thirds of the samples appear to have European origins, said Adriana Heguy, director of the Genome Technology Center at the medical center. The virus appears to have been imported to New York from the U.K. and several European countries, including France, Austria and the Netherlands, she said.
Genome sequencers are able to roughly correlate how a virus is spreading around the world by examining small mutations in a gene sequence of the pathogen as it’s transmitted from person to person. In the case of the coronavirus, whose RNA consists of about 30,000 genetic bases, or letters, it mutates about twice a month.

Those minor mutations tend not to change the potency of the virus. But they provide clues for genetic detectives to chart how they shift subtly over time, allowing them to create sprawling family trees, or phylogenies, that show how the coronavirus has spread from one part of the world or country to the next.

U.K. Origin

One of the first cases Heguy’s team sequenced, collected in early March, came from a Long Island resident with no travel history whose viral genome correlated with a strain circulating in England. That suggested the patient had contact with someone who had brought the virus over from the U.K.

The findings suggest that even after the Trump administration imposed travel restrictions from China, the virus continued to infiltrate the most populous U.S. city via daily flights from Europe.
Not all the New York virus samples have European origins. Some appear to have come from the U.S. West Coast, while others appear to link directly to Asia. That indicates that there are numerous chains of transmission in the metro area, as would be expected in such a large outbreak.
The NYU genome center had previously previously had been focused on sequencing for common diseases such as cancer and heart conditions. But in early March it switched to working almost exclusively on Covid-19.
“We basically turned our labs into Covid-19 labs overnight,” said Heguy. “That is all we are doing right now.”
https://www.bloomberg.com/news/articles/2020-04-08/most-nyc-covid-19-cases-came-from-europe-genome-researchers-say

Indivior withdraws 2020 forecast on coronavirus-led uncertainty

British drugmaker Indivior PLC withdrew its annual financial forecast on Wednesday, citing uncertainties due to the coronavirus pandemic.

The company said it does not expect to be in a position to provide revised forecast numbers until the duration and extent of the market disruptions caused by the outbreak are known.
The blow from the pandemic, which has severely dented global financial markets, comes at a time when Indivior has already been losing market share for its best-selling opioid addiction treatment Suboxone to cheaper alternatives.
The British drugmaker said on Wednesday it had seen a decline in demand for Sublocade and Perseris injections in recent weeks, largely due to patients being unable to visit their healthcare providers’ offices and a resulting shift to remote prescribing.
Indivior had gross cash of about $911 million and net cash of approximately $673 million as of March 31, the company said, adding that it will provide an update on its financial performance and business developments at its first-quarter results announcement on April 30.
(This story corrects paragraph 4 to “decline in demand for Sublocade and Perseris injections” from “decline in demand for Suboxone and other products”).

https://www.marketscreener.com/INDIVIOR-19344116/news/Indivior-withdraws-2020-forecast-on-coronavirus-led-uncertainty-30382578/

Foxconn Teams Up With Medtronic to Produce Ventilators

Foxconn Technology Group–best known for assembling Apple Inc.’s iPhones in China–is working with medical-device maker Medtronic PLC to develop and produce ventilators, the Taiwanese contract-assembly giant said Wednesday.
The move comes as the U.S. and other countries scramble to secure enough ventilators, which help patients severely ill with the coronavirus who have trouble breathing on their own. Besides traditional ventilator makers including Medtronic, new players such as General Motors Co. and Ford Motor Co. have joined the production crew to produce the device.
Foxconn’s announcement comes after Medtronic Chief Executive Omar Ishrak said on CNBC earlier this week that the two companies plan to produce the ventilators together at Foxconn’s Wisconsin plant over the next four to six weeks. “Currently, medical and technical personnel of both companies are working together closely. We hope to speed up the mass-production schedule,” Foxconn said.
In China, where the number of Covid-19 patients surged earlier, Foxconn has been producing millions of masks since February to help address medical-supply shortages. Meanwhile, Medtronic recently shared the design specifications for a ventilator product to allow other companies to produce it.

https://www.marketscreener.com/MEDTRONIC-PLC-20661655/news/Medtronic-Foxconn-Teams-Up-With-Medtronic-to-Produce-Ventilators-30383171/

CDC considers changing guidelines for those exposed to coronavirus

The Centers for Disease Control and Prevention (CDC) is considering new guidelines for those exposed to the coronavirus who do not show symptoms. 
The newly proposed guidelines would allow asymptomatic people who were exposed to the virus to resume work under the conditions that they would wear a mask and have their temperature checked regularly.
“I can tell you the CDC will have new guidance tomorrow that the CDC will be publishing for people who were in proximity to an individual that tested positive for coronavirus but have no symptoms,” Vice President Pence said during Tuesday’s coronavirus task force briefing. 

“Some of the best minds here at the White House are beginning to think about what recommendations will look like that we give to businesses, that we give to states, but it will all, I promise you, be informed on putting the health and well-being of the American people first,” Pence said.
The newly proposed guidance would aim to reduce some of the more restrictive CDC guidelines, which require essential workers to isolate for 14 days if exposed to the virus, regardless of whether or not they show symptoms.
Deborah Birx, the coronavirus response coordinator for the White House coronavirus task force, told CBS News on Wednesday that the upcoming advisories by the CDC would be “a very important piece” moving forward with handling the outbreak. 
“It looks at degree of exposure and really making it clear that exposure occurs within 6 feet for more than 15 minutes, so really understanding where you shouldn’t be within 6 feet of people right now,” Birx said. “But if you’re in a work situation where you have to be, there will be a series of recommendations that if you had had a significant exposure of what specifically to do, and if you’ve had a less exposure what to do.”
Pence added Tuesday night that the current focus is on the “point of need” for essential works but is also operating on a separate track for the rest of the public to follow in future recommendations.
https://thehill.com/policy/healthcare/worker-safety/491815-cdc-considers-changing-guidelines-for-those-exposed-to

NMC Health says it can’t oppose administration request made by creditor

NMC Health NMC, , the Middle Eastern hospital operator that was a FTSE 100 component, on Wednesday said it will be unable to oppose a filing by one of its creditors, Abu Dhabi Commercial Bank, to have it put into administration. NMC Health shares have been halted since late February on concern over unauthorized debts. “The Board has written to the Court indicating that, notwithstanding strenuous efforts to address Creditors’ concerns, it has not been able to secure their alignment and support and has been advised by its counsel that it is not in a position to oppose the application successfully. Accordingly, it expects the Company to be placed into administration in due course,” said NMC in a statement. NMC Health shares suffered after the short seller Muddy Waters drew attention to the firm.
https://www.marketwatch.com/story/nmc-health-says-it-cant-oppose-administration-request-made-by-creditor-2020-04-08