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Monday, June 27, 2022
GSK’s £40 Billion Consumer Arm Picks Citi, UBS as Brokers
GSK Plc’s consumer health arm has picked corporate brokers ahead of its planned spinoff on the London Stock Exchange, people with knowledge of the matter said.
Haleon Plc has chosen Citigroup Inc. and UBS Group AG as its brokers, who will be go-to advisers on everything from strategy to shareholder engagement, the people said. The banks were selected following a beauty parade several weeks ago, the people said, asking not to be identified because the information is private.
American Academy of Pediatrics Recommends Adolescent Suicide Screening
With suicide rates among young people rising in recent years, the American Academy of Pediatrics is now recommending adolescents 12 and up be screened for suiciderisk as a part of regular preventive care.
The group recently added the recommendation on screening for suicide risk to its depression screening guidelines. Health care providers are urged to ask their young patients a set of questions to identify thoughts and plans for suicide, WDEF.com reported.
“Number one we need to screen for depression and the presence of depression, and those people will usually have a feeling of depressed mood, hopelessness, helplessness, and/or basically a lack of interest in pleasure or anticipation of happiness,” Timothy Fuller, medical director of behavioral health and pediatrics for the American Academy of Pediatrics, told WDEF.
It’s a myth that talking about suicide makes it more likely a person will attempt suicide, he said.
“One of the biggest things you can do, as well, if you do have a child or teenager that has suicidality or that have depression with serious, significant suicide risk, is to just ask them how they’re doing every day,” Fuller said, according to WDEF.
The recommendation comes about 6 months after U.S. Surgeon General Vivek Murthy, MD, urged more attention be paid to youth mental health.
“Mental health challenges in children, adolescents, and young adults are real and widespread. Even before the pandemic, an alarming number of young people struggled with feelings of helplessness, depression, and thoughts of suicide – and rates have increased over the past decade,” Murthy said, according to a news releasefrom the U.S. Department of Health and Human Services.
Between 2007 and 2018, suicide rates among people ages 10 to 24 in the U.S. went up by 57%, the department said. Estimates showed over 6,600 suicides among this age group in 2020, it said.
Covid vaccine development could go Omicron-and-on
The big developers of Covid vaccines – plus Sanofi and GSK – recently touted data on their next-generation jabs’ ability to fight the Omicron variant. With the FDA tomorrow set to discuss whether and how to update the viral strains in vaccines, it looks like a new generation of Covid shots could be approaching.
This will be good news for companies looking to extend sales of their jabs, but the virus is already moving on. This was neatly shown by Pfizer and Moderna, which both released neutralising antibody data suggesting that their Omicron-specific candidates were around threefold less effective against the increasingly dominant BA.4 and BA.5 subvariants versus the previous incumbent, BA.1.
Sanofi and GSK, meanwhile, claimed the first reported efficacy data against Omicron; other companies have focused so far on generating immunogenicity data with their variant-specific efforts.
Sanofi and GSK said their Beta-containing candidate, when used as a primary vaccine, produced efficacy of 72% against Omicron, much higher than the 58% overall efficacy seen with their original jab.
The companies did not give details on the prevalence of subvariants, but it is interesting that a vaccine against the Beta variant – which was long ago eclipsed – apparently also provides protection against Omicron.
Adcom approaching
But the spotlight at tomorrow’s FDA adcom will be on Pfizer and its partner Biontech, and Moderna, the developers of the two US-approved mRNA vaccines.
Sellside analysts from Berenberg and SVB Securities think the companies have shown enough to get the nod for their Omicron-adapted boosters.
Talking points will include whether to plump for monovalent or bivalent approaches. Pfizer and Biontech’s monovalent project appears to have performed better, based on immunogenicity data the companies released on Saturday. Moderna has not yet disclosed data for its monovalent candidate, mRNA-1273.529.
| Latest Omicron-specific Covid vaccine data | ||
|---|---|---|
| Project | Company/ies | Latest data |
| Omicron-adapted monovalent vaccine | Pfizer/Biontech | 13.5-19.6-fold increase in neutralising antibodies against Omicron BA.1* |
| Omicron-adapted bivalent vaccine | 9.1-10.9-fold increase in neutralising antibodies against Omicron BA.1* | |
| mRNA-1273.214 (bivalent) | Moderna | 5.4-fold increase in neutralising antibodies against Omicron BA.4/5 (eightfold increase previously reported against BA.1) |
| Adjuvanted bivalent D614 and Beta vaccine | Sanofi/GSK | 72% efficacy in symptomatic Omicron cases |
| *In vitro data showed ~threefold lower activity against BA.4/5 vs BA.1. Source: company releases. | ||
Berenberg reckons the simplicity of a monovalent versus bivalent approach could be attractive, but SVB believes that bivalent vaccines will prevail, noting that in past adcoms panellists had favoured a multivalent approach to help protect against the emergence of new variants.
Another question for the adcom is whether to change the viral strains found in primary vaccines or boosters, or both.
Of the six options laid out in the FDA’s briefing documents, the third – which involves all boosters, but not the primary vaccine series, including an Omicron component – looks a likely outcome, according to Berenberg. Still, the make-up of primary vaccines is now largely irrelevant given that many people have already received their initial doses.
This fact is bad news for latecomers like Valneva, which last week finally got EU approval for VLA2001 as a primary vaccine.
There had been hopes that Valneva’s shot, which employs a whole inactivated virus, could provide more robust protection against new variants than mRNA vaccines that encode the spike protein, which is susceptible to variation.
The group might not get a chance to find out: only around 15% of European adults are unvaccinated, according to Stifel, and Valneva has said that based on current orders VLA2001 would not be commercially viable.
Epizyme accepts reality
Epizyme has become the latest depressed biotech to decide that securing some immediate cash is preferable to committing market suicide. The $247m takeover by Ipsen that it agreed to this morning values Epizyme 90% below its 2013 IPO price, and 95% below where it was trading in early 2020.
Back in 2020, of course, Epizyme had just launched its first drug, Tazverik. But investors took a dim view of the situation, and saw the solo launch as a cue to abandon the company. The sellside fled too, slashing Tazverik’s sales forecasts, and when the biotech market crashed – and GSK abandoned a key licensing deal to boot – Epizyme had no choice but to accept the inevitable.
It is not alone in having done so: just last week F-Star and Radius Health agreed to low-ball takeouts, the latter having also failed to make a splash with its first approved drug. While all three deals suggest a significant loss of value for any remaining long-term investors, the fact deals are happening at all is some comfort.
For its part Ipsen picks up Tazverik for a relatively small amount of cash, not long after it secured rights to Genfit’s elafibranor in another example of a low-ball deal with a depressed seller. Both transactions show Ipsen treading far more cautiously than when it spent $1bn on Clementia, whose lead project blew up in the clinic less than a year later.
The Tazverik millstone...
However, reality has caught up with Tazverik. The EZH2 inhibitor was once expected to sell over $1bn in 2026, Evaluate Pharma’s archived sellside forecasts reveal, but consensus now puts the number at a mere $373m. Such a reality check is not uncommon for products launched by small biotechs without the help of a more muscular partner, an earlier analysis showed.
Not only that, but to support its solo launch Epizyme had taken on long-term loans, which as of last month amounted to $217m on its balance sheet. Back in 2019 this might have seemed a paltry amount, but at Epizyme’s current valuation it stood as a significant overhang, likely contributing to the company’s willingness to take Ipsen’s money.
Ipsen today told investors that it expected Tazverik to be capable of $150-250m of peak sales in its current indications of relapsed follicular lymphoma either with an EZH2 mutation or without if patients have no further options, and in the niche use of epitheloid sarcoma.
However, Ipsen reckons sales could hit $800m if the drug gains a second-line mutation-agonistic follicular lymphoma label, something dependent on the confirmatory Symphony-1 trial. If Tazverik secures formal US second-line approval by 2028 Ipsen will pay Epizyme holders a contingent value right worth $119m; a further $51m CVR is payable if Tazverik sells $250m in any four consecutive quarters by the end of 2026.
...and little else
Epizyme's only other clinical asset of note is the SetD2 inhibitor EZM0141, which recently entered phase 1 in multiple myeloma and diffuse large B-cell lymphoma. Epizyme, a group founded on the promise of epigenetics, has several other assets targeting helicases and histone methyltransferase/ acetyltransferases, but these are all preclinical.
The company’s biggest endorsement had been a deal with GSK for two protein arginine methyltransferase inhibitors, GSK3326595 and GSK3368715. Both reached phase 1, but the UK group quietly canned the tie-up in March, citing “prioritisation within the synthetic lethal portfolio”.
Just before that Epizyme had pulled off an $85m equity offering, stretching its cash reach to late 2023. Despite this it still had net indebtedness; the current market is no place for messy capital structures, so investors should welcome Ipsen’s bailout.
https://www.evaluate.com/vantage/articles/news/deals/epizyme-accepts-reality
Akero: Improvement Seen in NASH Markers in Study
Akero Therapeutics Inc. (Nasdaq: AKRO), a clinical-stage company developing transformational treatments for patients with serious metabolic diseases marked by high unmet medical need, today announced the presentation of an analysis from its Phase 2a BALANCED study of efruxifermin (EFX) in patients with biopsy-confirmed F1-F3 fibrosis associated with non-alcoholic steatohepatitis (NASH). The data was presented at the 2022 International Liver Congress in a poster titled “Efruxifermin treatment improved histopathology and non-invasive markers of liver injury and fibrogenesis in NASH patients across PNPLA3 genotypes: a post hoc analysis of the Ph2a BALANCED study” (Poster SAT-114). The poster is available on Akero’s website.
Genetic variants in the PNPLA3 gene have been shown to significantly increase risk of NASH-related disease progression and fibrosis severity. Carriers of the I148M variant, which is prevalent among NASH patients, have a greater-than-threefold increased risk of NASH fibrosis and are at increased risk for progressing to end-stage liver disease, including hepatocellular carcinoma. A therapeutic that is proven to be effective in treating patients who carry the I148M variant could therefore help address an important unmedical need. The data presented at the 2022 International Liver Congress show that EFX treatment improved histopathology and noninvasive markers of liver injury across PNPLA3 genotypes, including in patients carrying the I148M variant. The data presented are based on 58 of the 80 study patients with biopsy-confirmed F1-F3 fibrosis in the BALANCED main study who consented to undergo genetic analyses. In addition to NASH histology across PNPLA3 I148M genotypes, the data also included analyses of EFX effects on liver fat content, serum triglycerides, and markers such as ALT, AST, GGT, Pro-C3, HbA1C, C-peptide, adiponectin, and HOMA-IR, across PNPLA3 I148M genotypes.
“We believe that EFX has the potential to treat patients with NASH who are at highest risk of disease progression, including patients who carry certain genetic variants in the PNPLA3 gene,” said Tim Rolph, chief scientific officer of Akero. “This new analysis of the Phase 2a BALANCED data, showing that response rates among patients who carry the PNPLA3 I148M variant were generally comparable to the response rates of those without it, provide further evidence of EFX’s potential to meet an important unmet medical need in NASH.”
EFX is currently being evaluated in two, parallel Phase 2b clinical trials, HARMONY and SYMMETRY, with results from the HARMONY study of patients with F2-F3 fibrosis expected in the third quarter of this year.
Eargo Shares Drop 14% After Investment from Patient Square Capital
Eargo Inc. shares were down 14% to $1.08 Monday after the medical device company said it has signed a definitive agreement with Patient Square Capital to raise $100 million through the sale of senior secured convertible notes, with an additional $25 million future investment subject to certain conditions.
The company said it intends to use the proceeds of Patient Square's investment for working capital purposes, to fund its omni-channel growth strategy and to repay all of its $15 million in existing third-party debt as well as related pay-off expenses.
Under the agreement, Eargo said it will issue $100 million aggregate principal amount of senior secured convertible notes to Patient Square upon closing.
Patient Square has also agreed to buy up to an additional $25 million of senior secured convertible notes if the rights offering hasn't been completed within 150 days, Eargo said.
Any proceeds from the rights offering will be used to redeem the senior secured convertible notes and for general corporate purposes. In the event the rights offering is not fully subscribed, the remaining senior secured convertible notes not redeemed in the rights offering will convert into 375 million common shares less the number of shares subscribed for in the rights offering, Eargo said.
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