FDA Approves MorphoSys and Incyte’s DLBCL Drug Monjuvi

Eight months after inking a collaboration deal, MorphoSys and Incyte won approval for a new treatment for adult patients with relapsed or refractory diffuse large B-cell lymphoma (DLBCL).

The companies announced late Friday that the U.S. Food and Drug Administration approved Monjuvi (tafasitamab-cxix) in combination with lenalidomide as a treatment for DLBCL. Shares for both companies are climbing in premarket trading, 4.48% and 6.78%, respectively. Monjuvi, a humanized Fc-modified cytolytic CD19 targeting monoclonal antibody, has been approved under accelerated approval by the FDA based on overall response rate.

The FDA approval for Monjuvi was based on data from the Phase II L-MIND study that showed an overall response rate of 55% in patients. That result includes a complete response rate of 37% and a partial response rate of 18%. The median duration of response was 21.7 months, which was a key secondary endpoint for the trial. Continued approval may be contingent upon verification and description of clinical benefit in a confirmatory trial, the companies said.

“The FDA approval of Monjuvi in combination with lenalidomide helps address an urgent unmet medical need for patients with relapsed or refractory DLBCL in the United States,” Hervé Hoppenot, chief executive officer of Incyte, said in a statement. “At Incyte we are committed to advancing patient care and are proud to bring this new and much-needed targeted therapeutic option to appropriate patients and the clinical community.”

DLBCL is the most common type of non-Hodgkin lymphoma in adults worldwide. The disease is characterized by rapidly growing masses of malignant B-cells in the lymph nodes, spleen, liver, bone marrow or other organs. It is an aggressive disease with about one in three patients not responding to initial therapy or relapsing thereafter. The FDA decision represents the first approval of a second-line treatment for adult patients who progressed during or after first-line therapy, the companies said in a joint announcement.

Jean-Paul Kress, CEO of Germany-based MorphoSys AG, said the company is proud that Monjuvi is the first-approved second-line treatment for patients with this indication.

“This approval marks an important step in MorphoSys’ transformation into a fully integrated biopharmaceutical company. We remain committed to developing innovative treatments to improve the lives of patients with serious diseases,” Kress said in a statement.

The FDA previously granted Fast Track and Breakthrough Therapy Designation for the combination of Monjuvi and lenalidomide in relapsed or refractory DLBCL. The Biologics License Application (BLA) for Monjuvi was granted Priority Review and approved under the FDA’s Accelerated Approval program.

Monjuvi is expected to be commercially available in the United States shortly. MorphoSys and Incyte will co-commercialize Monjuvi in the United States. Incyte has exclusive commercialization rights outside the United States. Incyte and MorphoSys inked a collaboration deal surrounding Monjuvi earlier this year. The deal is worth around $1.1 billion. The two companies are also exploring the use of Monjuvi in other indications, including, follicular lymphoma, marginal zone lymphoma and chronic lymphocytic leukemia.

https://www.biospace.com/article/fda-approves-morphosys-and-incyte-dlbcl-drug-monjuvi/

Healthineers makes its ambition plain with $16.4bn Varian buy

Suddenly 2020’s medtech M&A landscape looks very different.

Not content with being the largest group in medical imaging, Siemens Healthineers is now on course to become the leader in radiotherapy, too. Its acquisition of Varian Medical Systems for $16.4bn in cash is the biggest healthcare deal of 2020, and a bold move at a time of investor apprehension about procedure volumes in the near future.

But cancer treatment is still an urgent need, and despite the pandemic knocking Varian’s sales in its most recent quarter, the company’s revenues are forecast to grow at an impressive 8% per year out to 2026, according to EvaluateMedTech. And the deal might trigger defensive moves from other groups, with some industry watchers speculating that Philips might buy Varian’s main competitor, the Swedish group Elekta.

Healthineers currently has little presence in cancer treatment, though it formed a partnership with Varian called EnVision, centred on image-guided radiotherapy and radiosurgery, in 2012. Acquiring the company will net Healthineers a 52% market share in radiology.

Varian’s tech, which includes external beam radiation therapy, radiosurgery, proton beam therapy, brachytherapy and embolic microspheres, meshes well with Healthineers’ imaging unit and its other major strength, in vitro diagnostics. These three sectors are the major areas of capital spend for hospitals, according to analysts from Berenberg. Healthineers is already the global leader in imaging and the number four player in diagnostics, EvaluateMedTech’s consensus data shows.

Radiotherapy is likely to play an increased role in the growing need for cancer care, particularly as emerging markets open up. Ageing populations and the westernisation of developing markets are driving cancer incidence higher, fuelling demand. Morningstar analysts estimate that emerging markets can support twice as many radiology platforms as they have now without approaching the developed world’s number of systems.

More consolidation? 

At $177.50 per share the deal comes in at a 24% premium to Friday’s close. Siemens, which currently owns around 85% of Healthineers, will provide it with a €15.2bn bridge facility to help finance the deal. Healthineers plans to replace up to half that amount by issuing new equity, with the rest funded by debt provided by Siemens or one of its subsidiaries. Siemens said its stake in Healthineers would be diluted to roughly 72%, granting the spinout more autonomy.

Healthineers will have to deliver on its stated expectation of $300m in annual cost and revenue synergies for the deal to become value-accretive, as it says it will within a year. When the deal closes – expected in the first half of 2021 – the company will be an appealing supplier to hospitals that wish to limit the number of partners with whom they must deal.

These arguments do not only apply to Healthineers and Varian. Philips and Elekta, which also have a partnership that dates to 2012, this time to combine radiation therapy and MRI technology, might well also see the virtues of combining. If this does occur, however, Philips will still trail Healthineers significantly in the radiology market: EvaluateMedTech’s sellside consensus puts Elekta’s 2026 sales at less than a third of Varian’s.

Siemens Healthineers: No 1 in imaging… and radiotherapy?
	WW annual sales ($m)
Top 3 in diagnostic imaging	2019	2026e	CAGR
Siemens Healthineers	10,006	13,721	+5%
Philips	8,750	12,036	+5%
General Electric	9,158	8,548	-1%
Top 3 in radiology	2019	2026e	CAGR
Varian Medical Systems	1,642	2,675	+7%
Elekta	730	816	+2%
Accuray	175	330	+9%
Source: EvaluateMedTech.

https://www.evaluate.com/vantage/articles/news/deals/healthineers-makes-its-ambition-plain-164bn-varian-buy

Rival drugmakers launch joint trial of medicines for COVID-19

Rival drugmakers AbbVie Inc, Amgen Inc and Takeda Pharmaceuticals Inc on Monday said they have begun treating patients in a trial to quickly show whether a drug from each company can be repurposed and used against COVID-19, the disease caused by the novel coronavirus.

The COVID-19 pandemic is an “all hands on deck moment,” David Reese, Amgen’s research and development chief told Reuters. “We wanted a trial to be able to quickly sift through multiple agents and prioritize.”

The study is a collaboration among pharmaceutical industry members of the recently-formed COVID Research & Development Alliance, Quantum Leap Healthcare Collaborative, a partnership of medical researchers and investors, and the Food and Drug Administration.

The first segment will test whether Amgen’s psoriasis drug Otezla, Takeda’s anti-inflammatory Firazyr and AbbVie’s cenicriviroc, which has been tried in patients with HIV, will help with the overactive, and potentially damaging, immune response that sometimes happens in patients with severe COVID-19.

The study’s “adaptive platform” means several treatment candidates can be tested at the same time, with the most promising moving forward and the least promising dropping out, Quantum Leap co-founder Dr. Laura Esserman told Reuters.

“We could have some results in as early as six weeks,” she said, adding that additional drugs will soon be added to the roster.

Company officials said Otezla may be able to suppress inflammation from an overactive immune response; Firazyr may help limit fluid in the lungs; and cenicriviroc, which blocks activity of certain immune system cells, could reduce the severity of acute respiratory distress caused by the virus.

The drugs are being dosed in combination with Gilead Sciences Inc’s antiviral drug remdesivir and generic steroid dexamethasone, both of which have been shown in rigorous trials to help COVID-19 patients and are now considered to be standard care, Dr. Esserman said. A comparison group of patients will be given remdesivir and dexamethasone alone.

Hospitals have tried other anti-inflammatory drugs in COVID-19 patients, including Regeneron’s Kevzara and Roche Holding’s Actemra, but trials of both arthritis drugs failed to show effectiveness. Roche is continuing to test Actemra in combination with remdesivir.

The National Institute of Allergy and Infectious Diseases’ ongoing adaptive COVID-19 trial is studying remdesivir in combination with Olumiant, an arthritis drug sold by Eli Lilly & Co. Those results are expected next month.

Since the outbreak began seven months ago, so far killing more than 675,000 people worldwide, hundreds of clinical trials have been launched around the world to test whether existing drugs or experimental compounds could be effective treatments.

“There are a huge number of trials that for all the best intentions have been stood up around the world, but many are smaller – what we would call underpowered – and will not provide definitive answers,” Amgen’s Reese said.

https://www.marketscreener.com/TAKEDA-PHARMACEUTICAL-COM-6491073/news/Rival-drugmakers-launch-joint-trial-of-medicines-for-COVID-19-31044080/

Gilead Shows the Dangers of Covid-19 Drug Mania

Researchers are racing to develop a Covid-19 vaccine, and investors are in a mad dash to profit from it. The financial side of this exercise is likely to run into trouble.

Promising news in the hunt for a vaccine continues to pour in. Several companies have revealed encouraging, albeit preliminary, data in clinical trials, and the U.S. government has its wallet wide open to defray research and manufacturing expenses. GlaxoSmithKline and Sanofi said Friday that the U.S. government will pay up to $2.1 billion to develop and manufacture a Covid-19 vaccine. Other companies such as Moderna and AstraZeneca have received similar contracts. These deals include the upfront purchase of hundreds of millions of doses if trials prove successful. Heavyweights Merck & Co. and Johnson & Johnson also have candidates in development.

While it won’t be clear if any candidate is successful until at least the fall, investors aren’t waiting around. A broad index of biotechnology stocks has surged 65% since March. Within that group, the Covid-19 vaccine makers have led the way, both large and small. The gain in market value for these companies since the spring matches the total value of some major drugmakers that generate roughly $20 billion in annual sales.

There are ample reasons for caution, despite the clearly positive news. For starters, most drug candidates in development don’t reach the market. Huge research investments won’t change that reality.

And, even if successful, pricing power may not be as strong as investors are hoping. The first round of doses are already paid for and priced into stocks. Pfizer and its partner BioNTech, which didn’t take any government research funding, have a contract to deliver 100 million doses for a total of $1.95 billion. That comes out to about $39 per two-dose treatment.

Companies that hope to charge more than that over the long term will need to meet a very high safety and efficacy bar to make their case — especially those that took public funds upfront. While drug pricing hasn’t attracted much scrutiny this election cycle, it has been a recurring theme in American politics with major consequences for shareholders. That dynamic likely makes visions of windfall profits more dream than reality.

Granted, some risk-taking is always necessary to make money in biotech. And story stocks have a way of maintaining their upward momentum while hopes for the future are still intact — particularly in today’s euphoric investing environment.

But investors shouldn’t forget that hot drug stocks can suddenly plunge even if things go according to plan. Gilead Sciences shares surged nearly 25% from March to April as anticipation built for its antiviral Covid-19 treatment remdesivir, but the stock has since lost nearly all of that ground. Those losses came despite a string of successes: The drug has been authorized for emergency use, and Gilead began selling it this summer after donating its initial supply. Last week, the company increased the midpoint of its 2020 adjusted profit guidance to $6.95 a share from $6.25.

Don’t dismiss the possibility that Gilead’s descent will repeat itself on a much larger, uglier scale.

https://www.marketscreener.com/news/Gilead-Shows-the-Dangers-of-Covid-19-Drug-Mania-Heard-on-the-Street–31044679/?countview=0

Roche’s first tumor agnostic therapy OK’d in Europe

As expected, the European Commission (EC) has approved Roche’s (OTCQX:RHHBY) Rozlytrek (entrectinib) for the treatment of patients at least 12 years old with solid tumours expressing a neurotrophic tyrosine receptor kinase (NTRK) gene fusion, who have a disease that is locally advanced, metastatic or where surgical resection is likely to result in severe morbidity, and who have not received a prior NTRK inhibitor, who have no satisfactory treatment options. The EC also approved the kinase inhibitor for the treatment of adults with ROS1-positive, advanced non-small cell lung cancer (NSCLC) not previously treated with ROS1 inhibitors.

Entrectinib is designed to inhibit the kinase activity of the TRKA/B/C and ROS1 proteins regardless of the type of tumor expressing the gene fusions or the ROS1 enzyme.

In late May, the advisory group CHMP adopted a positive opinion backing approval.

https://seekingalpha.com/news/3598798-roches-first-tumor-agnostic-therapy-okd-in-europe

McKesson EPS beats by $0.38, beats on revenue

McKesson (NYSE:MCK): Q1 Non-GAAP EPS of $2.77 beats by $0.38; GAAP EPS of $2.72 beats by $1.03.

Revenue of $55.68B (-0.1% Y/Y) beats by $1.52B.

Gross income of $2.65B vs. consensus of $2.62B and Operating income of $680M vs. consensus of $590.8M.

Shares +1.9% PM.

Press Release

https://seekingalpha.com/news/3598819-mckesson-eps-beats-0_38-beats-on-revenue

Lilly launches late-stage study of Covid neutralizing antibody in long-term care

Eli Lilly (NYSE:LLY) initiates a Phase 3 clinical trial, BLAZE-2, evaluating LY-CoV555 for the prevention of COVID-19 in residents and staff at long-term care facilities in the U.S. (nursing homes, assisted living facilities). It is partnering with NIH’s NIAID and the COVID-19 Prevention Network on the study.

The 2,400-subject trial will recruit residents and staff who live or work at facilities that have had a recent COVID-19 case. It will assess the ability of one dose of LY-CoV555 to prevent the respiratory infection through week 4 and COVID-19-related complications through week 8.

LY-CoV555 is a neutralizing IgG1 monoclonal antibody directed to the SARS-CoV-2 spike protein. It is designed to block the attachment of the virus to a healthy cell, the first step in the infection process.

https://seekingalpha.com/news/3598811-lilly-launches-late-stage-study-of-covidminus-19-neutralizing-antibody-in-long-term-care