Sanofi to co-develop Teva Pharmaceutical's Colitis, Crohn's drug

 Teva Pharmaceutical Industries said on Wednesday it will collaborate with French drugmaker Sanofi to co-develop its treatment for ulcerative colitis and Crohn's disease that it expects to ultimately be a blockbuster drug.

Sanofi, a leader in immunology, will invest $1.5 billion in the development of Teva's irritable bowel syndrome (IBD) drug anti-TL1A, which is still in clinical 2 trials with interim results not expected until the second half of 2024.

Clinical 3 trials are not expected to begin until 2025 and Teva CEO Richard Francis said the best case scenario for the drug's commercial launch would be around 2028.

"The fact that they've done their due diligence on our anti-TL1A asset ... and to put up $1.5 billion, as well as allow Teva to retain 50% of the worldwide economics once it's launched, I think shows that they believe in the asset," Francis told Reuters.

Under the terms of the deal, Teva will receive an upfront payment of $500 million in cash once the transaction closes, which is expected by the end of 2023, and up to $1 billion in development and launch milestones.

Both companies will equally share the development costs globally and net profits and losses in major markets, with other markets subject to a royalty arrangement. Sanofi will lead the development of the Phase 3 clinical trials, Teva said.

Teva will lead commercialization of the product in Europe, Israel and specified other countries, and Sanofi will lead commercialization in North America, Japan, other parts of Asia and the rest of the world.

Francis estimated the IBD market at nearly $30 billion and said many patients do not respond to current treatments. As such, "we believe it will be a multi-billion-dollar asset. We will know that better as we get closer to market. Right now, we believe it is the best TL1A in development," he said. 

https://uk.finance.yahoo.com/news/sanofi-co-develop-teva-pharmaceuticals-071527640.html

How Some Companies Are Winning in a Parched Funding Climate

 If you ask Mizuho Americas’ Graig Suvannavejh to describe the biopharma investing climate right now, he’ll say it’s “very challenging.”

The senior biopharmaceuticals and biotech financial analyst noted that this is in contrast to just a few years ago when investors found the industry an attractive alternative to sectors such as hospitality, oil and gas and airlines, which were hit hard by the pandemic. At that time, investors went into biotech, "which fueled . . . what I would consider a bit of a bubble in terms of new company creation, the number of IPOs and how much money was being raised,” Suvannavejh told BioSpace.

In the current climate, there are several factors Suvannavejh believes are contributing to challenges with getting funding: high interest rates, geopolitical risk related to the war in Ukraine and China/Taiwan tension, the approaching election and rhetoric politicians are using about pharma companies on the campaign trail, and the potential for drugs to make less money if they are subject to price negotiation under the Inflation Reduction Act (IRA).

Despite this tough investing environment, a select few companies are still managing to secure hundreds of millions in funding. One early example came in August 2022 when Karuna Therapeutics raised $862.5 million in funding after publishing promising Phase III trial data on a drug to treat schizophrenia. Its competitor, Cerevel, which has a similar program targeting the same disease, raised $554 million in a piggybacking event after this data was published, Suvannavejh said.

This highlights the first trend he sees with companies that are managing to win funding today, a trend that remains constant: Good data—more specifically, good, late-stage data—almost always secures funding.

In another example, argenx released very positive Phase II data in July for its lead program, VYVGART. The drug is already FDA-approved for the autoimmune disorder myasthenia gravis, and the new data indicated it may be effective against other diseases as well, enabling the company to secure $1.27 billion in funding, Suvannavejh said.

In addition to this, Suvannavejh said there are a few other drug categories that have the best potential to defy current funding trends because of growing interest from investors:

GLP-1 Agonists for Obesity and Diabetes

• Reasoning: “All the attention is going to [Novo] Nordisk and Eli Lilly [producers of GLP-1 agonists Ozemic and Wegovy] and how great the market opportunity is for their drugs that are on the market, and people are talking about a $100 billion market potential,” Suvannavejh said.
• Indicator: Structure Therapeutics raised $300 million last week after releasing promising Phase I data for a GLP-1 agonist candidate similar to Ozempic and Wegovy that would be ingested as a pill rather than injected.

Treatments for Neurodegenerative Diseases

• Reasoning: There seems to be growing interest in funding companies in this space despite the fact that the risk is quite high, Suvannavejh said. "But what we’ve also seen is the FDA showing a larger degree of what I describe as regulatory flexibility." For example, the controversial approval of Biogen’s Aduhelm for Alzheimer’s in 2021. “I think there’s increased interest in the neurodegenerative disease space because the unmet medical need is high. . . . We don’t have really good drugs, and the FDA is saying, ‘You know what, we’ll look at alternative things to make sure we get drugs for these patients."
• Indicator: In April of this year, the FDA approved Biogen and Ionis’ Qalsody as the fourth-ever therapy for amyotrophic lateral sclerosis (ALS), despite previously reported negative Phase III efficacy data.

Autoimmune and Inflammatory Disease Drugs

• Reasoning: “The key to those drugs is they work in lots of different diseases,” Suvannavejh said. For example, AbbVie's Humira was initially greenlit for treating rheumatoid arthritis but was later approved for use in more than 10 diseases and at its peak had annual sales of $20 billion. “So if you can get a drug in autoimmune diseases [where] there seems to be a central mechanism of action and it can treat lots of diseases, you can generate lots of sales,” Suvannavejh said.
• Indicator: Acelyrin, a late-stage, immunology-focused biopharma, raised $621 million in its IPO in May.

Cancer Drugs 

• Reasoning: There is a high unmet medical need with a large potential population; cancer is the third leading cause of death worldwide.
• Indicator: Merck’s Keytruda raked in $20.9 billion in sales in 2022.

https://www.biospace.com/article/how-some-companies-are-winning-in-a-parched-funding-climate/

Novartis Spinoff Sandoz to Start Trading as Standalone Drugmaker

 

• Swiss company could offer above-industry growth, analysts say
• Split leaves Novartis focused solely on innovative treatments

Sandoz Group AG, the maker of copycat medicines that was spun off from drugmaker Novartis AG, begins life as a standalone company on Wednesday when its shares start trading on the Swiss stock exchange.

The generics leader will now have more freedom to pursue its own growth strategy to challenge industry stalwarts like Viatris Inc. and Teva Pharmaceutical Industries Ltd.

https://www.bloomberg.com/news/articles/2023-10-04/sandoz-starts-trading-in-final-step-after-novartis-split

Food Stamps Will Be Harder To Get From October

  by Jack Phillips via The Epoch Times,

This month, Supplemental Nutrition Assistance Program (SNAP) benefits will get a boost, but eligibility requirements have changed

The new rules, which went into effect Oct. 1, stipulate that able-bodied adults without dependents between the ages of 52 and 54 will have to prove that they are actively working, training, or in school. Before, those between the ages of 18 and 52 had to prove they are working at least 80 hours per month, in school, or involved in a training program to get the SNAP benefits.

The age requirement was expanded as part of the debt ceiling deal that was passed in Congress and signed by President Joe Biden earlier this year. The age requirement will expand by another year in October 2024, while the new requirements will be in effect until Oct. 1, 2030.

With the recent changes, the left-wing Center on Budget and Policy Priorities warned that more than 750,000 "older adults" are at risk of losing SNAP benefits due to the "expansion of the existing, failed SNAP work-reporting requirement." The requirements initiated under the debt ceiling deal were the largest changes made to the SNAP, or food stamps, in decades.

"The expansion of this requirement would take food assistance away from large numbers of people, including many who have serious barriers to employment as well as others who are working or should be exempt but are caught up in red tape," it said.

It was part of a deal between President Biden and House Speaker Kevin McCarthy (R-Calif.) several months ago. At the time, Mr. McCarthy said that "what work requirements actually do [is to] help people get a job."

Republicans have tried for decades to expand work requirements for these government assistance programs, arguing they result in more people returning to the workforce. “We’re going to return these programs to being a life vest, not a lifestyle. A hand up, not a handout and that has always been the American way,” Rep. Mike Johnson (R-La.) told reporters in June.

A U.S. Department of Agriculture spokesperson told The Hill that there are some exceptions to the new requirements. They include veterans, homeless people, and people aged 18 to 24 who aged out of foster care situations, the spokesperson said.

Those who have a mental or physical limitation, have a child aged 18 or younger living in their home, or pregnant women are also exempt, the spokesperson added.

At the same time, individuals who already get SNAP and still qualify will see their benefits increase starting Oct. 1, said the USDA. Benefit changes for SNAP are based on the Consumer Price Index that measures inflation for June 2022.

"The maximum allotments will increase for the 48 states and D.C., Alaska, Guam, and the U.S. Virgin Islands," the agency said.

"The maximum allotment for a family of four in the 48 states and D.C., will be $973," and allotments "for a family of four will range from $1,248 to $1,937 in Alaska," while "maximum allotments for a family of four in Hawaii will decrease to $1,759.

The minimum benefit for all 48 states and the District of Columbia will stay the same at $23, according to the USDA.

The average family started receiving about $90 less per month in March, although some households dropped by up to $250, according to a study by the Center on Budget and Policy Priorities.

Fraud?

Last month, Sen. Joni Ernst (R-Iowa) warned that the food stamp program is losing some $1 billion per month due to errors and fraud as she announced legislation designed to deal with the alleged monthly losses.

"Families across the country are going hungry while bureaucrats are jumping the line to gobble up SNAP dollars, either as a meal ticket to beef up state budgets or a self-serve buffet of benefits for themselves or others who do not qualify," the senator said.

"I’m snapping back! It’s time for states at fault to pay the piper and eat the costs of their taxpayer waste. Instead of overserving bureaucrats, let’s end the waste and set a place at the table for hungry families," Ms. Ernst added.

Other Details

Earlier this year, the federal government ended its public health emergency over COVID-19, which ended a booster program for all SNAP recipients. The duration of those extra payments was originally tied directly to the duration of the public health emergency, but that was changed in December 2022 and the final pandemic-boosted SNAP payments went out at the end of February.

The emergency program was enacted by Congress at the start of the pandemic in March 2020 and expanded a year later. Originally, the extra benefits were intended to continue as long as the COVID-19 public health emergency was in force before it expired.

SNAP benefits can rise and fall with inflation and other factors. Maximum benefits went up by 12 percent in October to reflect an annual cost-of-living adjustment boosted by higher prices for foods and other goods. But payments went down for those who also receive Social Security because of the 8.7 percent cost-of-living increase in that program on Jan 1.

https://www.zerohedge.com/personal-finance/food-stamps-will-be-harder-get-october

Aarg! Homeless Pirates Pillage Leisure Boats In San Francisco Bay

 There's a new, maritime dimension to the scourge of rampant crime in northern California cities, as homeless creeps are now taking to the water and preying on houseboats and yachts docked on San Francisco Bay, reports Fox News. 

"Multiple vessels have been stolen and ransacked. Victims have had to resort to personally confronting the criminals to recover their property without the benefit of police support," said former harbor master Brock de Lappe at a recent municipal meeting. "Is this appropriate activity for a 79-year-old senior?"

The 3,000-slip Oakland-Alameda Estuary has been particularly hard-hit, as thieves use small boats to burglarize or steal private boats on the waterway. The pirates use stolen boats or old, abandoned dinghies to carry out their raids. 

A boating school for children has seen four of its eight safety boats stolen and destroyed. The boats cost the school between $25,000 and $35,000 apiece. "We cannot run our program without these boats," wrote Kame Richards, owner of the nonprofit Alameda Community Sailing Center, in a letter to his municipal commission.

"The response we received from APD (Alameda Police Department) was that they could do nothing, and a warning not to approach the perpetrators if we located our boats," added Richards. Sounds about par for the course in a state where the Senate has advanced a bill that would criminalize retail-store policies requiring employees to attempt to thwart thieves. 

"We had all hands on deck to retrieve this stuff, and it took 35 hours to get a police report number from the Alameda Police Department," said Richards during a municipal meeting. The school is on the verge of calling it quits.

Another woman scared a troubling tale, telling Fox that she recently heard faint cries of "help me, please, please, anybody help me" coming from the inky darkness of the estuary. She dared to venture out with her kayak and a headlamp, and found a sailboat with a "panicked and terrified young man" aboard. He said pirates cut his sailboat line and set him adrift after a confrontation. 

"If there had been any wind at the time I wouldn't have been able to go out there and rescue this young man who had no motor and no ability to sail that boat," said his rescuer, who requested anonymity for fear of reprisals. 

Things have deteriorated to the point that a group that has regularly volunteered to clean up the waterway for the past six years cancelled this year's event "because of safety concerns" arising from a particularly concerning homeless encampment. "Unfortunately, I don't feel comfortable bringing children to the site until those are addressed by the city of Oakland," said the group's leader, Mary Spicer. 

Alameda island has received high marks for suburban livability, but that's in jeopardy as it's increasingly feeling the ill effects of being across a narrow channel from Oakland and its skyrocketing homeless population. The island city has no maritime police equipment, and has seen its police force shrink by 30% in recent years. 

https://www.zerohedge.com/political/aarg-homeless-pirates-pillage-leisure-boats-san-francisco-bay

Victor Davis Hanson Warns Tucker: "The Next 12 Months Will Be The Most Explosive In History"

 Historian Victor Davis Hanson sat down with Tucker Carlson to discuss his perspective on the current political climate in the US, asserting that American liberalism is characterized by dishonesty, and warning about what he sees as liberal efforts to introduce a highly intolerant age.

"It's hard for most Americans to comprehend the total dishonesty of American liberalism."

VDH says Trump represents a significant threat to the specific vision held by liberals, who are employing a "critical legal theory," in which traditional moral values are abandoned in favor of whatever gains power.

"Liberals are now telling us they plan to protect American democracy and that's the clearest possible sign that they intend to end it."

Most specifically, Hanson told Carlson that:

"I think they’ve come to the conclusion that Trump is an existential threat and by association, half the country is to their vision of what they want to transform us into, and so they feel that whatever means necessary are justified."

And this is an issue since Hanson pointed out that while some conservatives were speaking up, they are also fighting a culture in the Republican Party that preferred to "lose nobly" as opposed to winning elections in an "ugly" manner.

Hanson emphasizes that the traditional boundaries and norms are being renegotiated, from the Senate filibuster and the Electoral College to societal understandings of gender and language, raising concerns that:

"We're in the middle of a cultural, economic, political revolution," but "we think that we’re still playing within the same sidelines or parameters, and we’re not. Everything’s under negotiation.”

Hanson argues that the legal actions against Trump are politically motivated and biased and designed to send a message to the half of America that will not simple 'comply':

“The idea is now that we now have the power to do this, and because we have the power to do it, it’s moral and right, and if you don’t like it, what are you doing to do about it?”

Finally, Hanson issues a call to action of sorts, noting that “There are legitimate efforts to rectify and stop this madness and let’s see what happens in 2024."

"You need leaders who will tell people we are in a Jacobin takeover of this country, and the old get along at any cost does not work,” Hanson said.

"I hope everybody can keep their head because I think the next 12 to 18 months are going to be the most explosive in our history since the Great Depression."

Watch the full interview below:

https://www.zerohedge.com/political/were-middle-revolution-victor-davis-hanson-warns-tucker-next-12-months-will-be-most

Something “Big and Stupid” Is Coming…

 With debt levels reaching all-time highs in major developed and developing economies, and with debt-to-GDP ratios also in record territory (not including contingent liabilities such as Social Security, health care and other entitlements, which make matters worse), it seems time to consider just how nations will deal with this problem.

The debt crisis may not be imminent, but it is unavoidable. When it happens, it may present the greatest financial disaster of all time. It’s never too soon for investors to consider the fallout.

When you issue debt in a currency you print, there’s no need for default in the sense of non-payment.

You can just have the central bank buy the debt (by printing money). This is the situation today in the U.S., Japan, the U.K. and the European Monetary Union (the countries that use the euro). They all have huge debt burdens, but they all have central banks that can simply buy the debt by printing money to avoid default.

Non-Payment Is Not the Issue

There are many bad consequences to printing money and storing up debt on central bank balance sheets, but non-payment of debt is not one of them. This is the mantra of the Modern Monetary Theorists (MMT) and their thought leader Stephanie Kelton.

In my view, MMT is garbage as economic policy, but the no-default tenet is valid. George Soros says the same thing.

That said, we are well past the point where the debt can be managed with real growth. That threshold is about a 90% debt-to-GDP ratio. A 60% debt-to-GDP ratio is even more comfortable and can be managed.

Unfortunately, the major reserve currency economies are all well past the 90% ratio as are those of many smaller countries. The U.S. ratio is 134%, an all-time high. The U.K. ratio is 102%. France is 111%. Spain is 112%. Italy is 145%.

China reports a figure of 77% but this is highly misleading because it ignores provincial debt for which Beijing is ultimately responsible. China’s actual figure is over 200% when provisional debt is included.

The champion debtor is Japan at 261%. The only major economy with a halfway respectable ratio is Germany at 67%. It’s Germany’s misfortune that they are probably responsible for the rest of Europe through the ECB Target2 system.

All these countries are headed for default. But we must consider the different ways to conduct a default.

There are three basic ways to default: non-payment, inflation and debt restructuring. You can take non-payment off the table for the reason mentioned above — you can always just print the money.

The same goes for restructuring. Inflation is clearly the best way to default. You pay back the money in nominal terms, but it’s worth very little in real terms. The creditor loses and the debtor countries win.

Nice and Easy Does It

The key to inflating away the real value of debt is to go slowly. It’s like stealing money from your mother’s purse. If she has $50 and you take $40, she’ll notice. If you take one dollar, she won’t notice. But a dollar stolen every day adds up over time.

This is what the U.S. did from 1945–1980. At the end of World War II, the U.S. debt-to-GDP ratio was 120% (about where it is now). By 1980, the ratio was 30%, which is entirely manageable.

Of course, nominal debt and GDP soared, but nominal GDP went up faster than nominal debt, so the ratio fell. If you can keep inflation around 3% and interest rates around 2% and exert fiscal discipline (which we did under Eisenhower, Kennedy, Nixon and Ford), the nominal GDP will grow faster than nominal debt (due to the Fed capping rates).

If you improve the ratio by, say, 2% per year and keep it up for 35 years (1945–1980), you can cut the ratio by 70%. That’s what we did.

The key was to do it slowly (like stealing from your mom’s purse). Almost no one noticed the decline in the real value of money until we got to the blow-off stage (1978–1981). But by then it was mission accomplished.

So there are two ways to deal with excessive debt: fiscal discipline and inflation. From 1945–1980, the U.S. did just that. If you run inflation at 3% and interest rates are 2%, you melt the real value of debt. If you exert fiscal discipline relative to GDP, you decrease the nominal debt-to-GDP ratio.

We did both.

The reason the debt-to-GDP ratio is back up to 134% is that Bush45, Obama, Trump and Biden ignored the formula. Since 2000, fiscal policy has been reckless so the formula doesn’t work. The problem isn’t really “money printing” (most of the money the Fed prints just comes back to the Fed as excess reserves, so it doesn’t do anything in the real economy).

The problem is that nominal debt is going up faster than nominal GDP, so the debt-to-GDP ratio goes up. This dynamic will be made much worse by the huge increase in interest rates over the past 18 months.

You can’t borrow your way out of a debt crisis. We have also been unable to generate much inflation. Inflation ran below 2% for almost all of the 2009–2019 recovery.

Japan Writ Large

Looking at the global picture, it’s important to understand that Japan is just a bigger version of the U.S. They don’t have fiscal discipline and they can’t get inflation to save their lives. The only way out for Japan is hyperinflation, which will come but not yet.

Japan can probably keep the debt game going for a while. The crash will come when the currency collapses. When I started in banking, USD/JPY was 400. Those were the days!

A debt crisis is on the way. Something big and stupid (in the words of the brilliant analyst Stephanie Pomboy) is coming from policymakers to address the issue. But the solution won’t be a policy and it won’t be a plan. A crisis will just happen almost overnight and seem to come from nowhere.

But it will come.

https://dailyreckoning.com/something-big-and-stupid-is-coming/